Proposed Rule Allows Religious Organizations to Sidestep Contraception Mandate

On Friday, President Barack Obama’s administration proposed a rule which would modify the Affordable Care Act’s Contraception Mandate to allow religious organizations to opt-out of directly providing contraceptives to its employees. The contraception mandate, which went into effect January 1, 2013, requires most private companies and employers to offer health services, including contraception services to their workers. The contraception rule had prompted many lawsuits whereby religious organizations brought suit against the federal government seeking injunctions and temporary restraining orders in anticipation of the inception of the contraception rule, arguing that it infringed on their religious liberty.

The new proposed rule would allow nonprofit religious organizations to opt out of the contraception mandate. Instead the organization’s insurer or third-party administrator would be responsible for providing the services to the employees. This would provide a barrier between the organization and the contraception.

The insurers would be responsible for providing separate plans to employees for contraception. The Department of Health and Human Services stated that the proposed rule would be cost-neutral for the insurers that were already providing health plans for religious organizations. The HHS argues that providing contraception would save the insurers money as employees would benefit from fewer births and improvements in women’s health. In self-insured organizations, third-party administrators would contract with insurers to provide coverage and the insurers would be reimbursed by the federally facilitated insurance exchange.

The new rule could potentially cut down the number of law suits against the government, as some religious organizations will be satisfied that the new rule puts a distance between them and the contraception. Other organizations will undoubtedly remain unsatisfied.