Supreme Court Decides Little Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania and Trump v. Pennsylvania

Faegre Drinker Biddle & Reath LLP

Faegre Drinker Biddle & Reath LLP

On July 8, 2020, the U.S. Supreme Court decided Little Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania and Trump v. Pennsylvania, holding that the Department of Health and Human Services validly created religious exemptions from the requirement of the Patient Protection and Affordable Care Act of 2010 (Affordable Care Act) that employer-provided health insurance must include contraceptive coverage.

The Affordable Care Act requires many employers to offer health plans that include, for women, “such additional preventive care and screenings … as provided for in comprehensive guidelines” issued by the Health Resources and Services Administration (HRSA). The statute does not define “preventive care and screenings” and does not include an exhaustive or illustrative list of such services. Starting in 2011, HRSA regulations required such health plans to cover “contraceptive methods and sterilization procedures.” But after years of religious objections and related litigation, in 2017 and 2018 HRSA promulgated rules exempting from this “contraceptive mandate” a broad class of employers with religious objections. Pennsylvania challenged those rules, asserting that the rules were procedurally and substantively invalid under the Administrative Procedures Act (APA). The district court agreed entered a nationwide injunction against the exemption, and the Third Circuit affirmed the injunction on appeal.

The Supreme Court reversed by a 7-2 vote. The Court first rejected Pennsylvania’s argument that religious exemptions are not authorized by the Affordable Care Act. The Court held that on its face, the Affordable Care Act “is completely silent as to what” the preventive-care “guidelines must contain,” and therefore “gives HRSA broad discretion to define preventive care and screenings and to create the religious and moral exemptions.” The Supreme Court also held that it was appropriate for the government, in promulgating the exemption, to consider the “very broad protection for religious liberty” provided by the Religious Freedom Restoration Act (RFRA). The Court noted that “the potential for conflict between the contraceptive mandate and RFRA” is clear, and settled administrative law holds that an agency may not “entirely fail to consider an important aspect of the problem” it is addressing.

The Court acknowledged that in the administrative process, the rule creating the exemption was preceded by a document entitled “Interim Final Rules with Request for Comments” rather than “General Notice of Proposed Rulemaking,” as would be more customary. But the Court held that the formal title of this document did not matter, because in substance “the rules contained all of the elements of a notice of proposed rulemaking” as the APA requires.

Finally, the Supreme Court rejected the Third Circuit’s holding that the exemption was invalid because the government “lacked the requisite ‘flexible and open-minded attitude’” when it considered and promulgated the exemption. The Court held that there is no “open-mindedness test” under the APA.

Justice Thomas authored the opinion of the Court, joined by Chief Justice Roberts and Justices Alito, Gorsuch, and Kavanaugh. Justice Kagan filed an opinion concurring in the judgment, joined by Justice Breyer. Justice Ginsburg filed a dissenting opinion, joined by Justice Sotomayor.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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