By: Joseph P. Yonadi, Jr. and Nancy R. Chawla

Last week the Department of Treasury, U.S. Department of Labor, Department of Health and Human Services (Departments) published rules exempting employers from the contraceptive coverage mandate created under the Affordable Care Act.  As a result, hundreds of thousands of women stand to lose access to contraceptive services.

Background: One feature of the 2010 Affordable Care Act was the contraceptive coverage mandate. The mandate paved the way for women to receive access to birth control benefits at no cost through their employers’ health plans. Several employers, including Hobby Lobby, opposed the mandate on religious grounds. In 2014, the Supreme Court ruled that a “closely held” company could invoke religious objections to avoid covering contraception. Burwell v. Hobby Lobby Stores, Inc., 134 S.Ct. 2751 (2014). Despite the Hobby Lobby decision, the mandate has made contraceptive services widely accessible to women who otherwise could not afford them.

Exemptions: The Departments created two exemptions to the mandate. One exemption would allow employers to object contraceptive coverage “based on [their] sincerely held religious beliefs.” Another exemption would allow employers to object contraceptive coverage based on their sincerely held “moral convictions.”

All employers, including family-owned companies and publicly traded companies, will be allowed to take advantage of these exemptions.  However, the American Civil Liberties Union (ACLU) and other groups have announced their intent to challenge the validity of the exemptions.

The interim final rules took effect on October 6, 2017. The comment period for the interim final rules ends on December 5, 2017.

Although the interim final rules took effect immediately, the final rules control employers actions with respect to changes in contraceptive coverage services policies. It remains to be seen whether the rules will be upheld in court.