US Supreme Court order adds twist to contraception mandate challenges

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A one-page, nonmerits order from the U.S. Supreme Court has infused new energy into court challenges brought by nonprofit employers who claim that the Affordable Care Act’s contraception coverage requirement violates their constitutional and statutory religious rights.

The law requires most employers who offer employee health care plans to provide no-cost contraception coverage. Religious organizations like churches are exempt, but nonprofit groups are required to either comply with the law or submit a form to the Department of Health and Human Services that allows full no-cost coverage to be provided through third-party administrators.

Some nonprofit groups, including the Little Sisters of the Poor, an order of Catholic nuns that runs an elderly care facility in Denver, have challenged the law, asserting that the third-party coverage opt-out violates their religious freedom rights under the First Amendment and the Religious Freedom Restoration Act.

They claim that the government is forcing them to authorize a third party to give their employees contraception, which is against their religious beliefs.

The 10th U.S. Circuit Court of Appeals denied a preliminary injunction request from the Little Sisters of the Poor. But on New Year’s Eve, just hours before the contraception mandate provision was set to go into effect, Justice Sonia Sotomayor issued an order temporarily blocking enforcement of that provision against the Denver nuns.

Nearly a month later the full court issued a one-page, unsigned order granting injunctive relief to the sisters while the 10th Circuit considers the merits of their challenge. But the order came with a twist: it required the nuns to notify the Department of Health and Human Services of their objection to the law.

While the order stressed that it was not a ruling on the merits, attorneys representing nonprofit groups say that it undercuts a key argument by the government: that the third-party coverage form provides the government with notice of non-profit groups’ religious objections.

“The Supreme Court’s order gets the government the notice it asked for, but without requiring the Sisters to violate their religion by signing the form,” said Mark Rienzi, senior counsel for the Becket Fund for Religious Liberty in Washington, which represents the Little Sisters and several other employers challenging the law.

An issue of notice

The court’s order was an unusual move. The justices often issue brief, unsigned orders but rarely attach a series of conditions.

In this instance, the order reads in part:

“If the employer applicants inform the Secretary of Health and Human Services in writing that they are non-profit organizations that hold themselves out as religious and have religious objections to providing coverage for contraceptive services, the respondents are enjoined from enforcing against the applicants the challenged provisions … pending final disposition of the appeal by the United States Court of Appeals for the 10th Circuit. To meet the condition for injunction pending appeal, applicants need not use the form prescribed by the Government and need not send copies to third-party administrators. The Court issues this order based on all of the circumstances of the case, and this order should not be construed as an expression of the Court’s views on the merits.”

Despite that caveat, attorneys for employers say the order provides a Supreme Court-approved template for nonprofit groups to opt out of the law’s requirements while their challenges proceed through the courts, and even bolsters their legal claims that the law should not apply to them at all.

The government argues, in part, that requiring employers to sign third-party forms if they choose not to offer contraception coverage does not amount to forced coverage, but is merely a way of notifying the government of religious objections.

Rienzi said that argument has now been undercut by the justices. “The government will have a hard time arguing about why it still needs to make the Sisters sign the form,” he said.

The impact of the order on other cases was swift. The University of Notre Dame, the only other nonprofit employer besides the Little Sisters of the Poor to be denied an injunction pending its challenge in federal court, renewed its request for injunctive relief with the 7th Circuit. More than a dozen other nonprofit organizations have pending requests for preliminary injunctive relief, and several revised those requests to reflect the justices’ order. Thus far, 19 nonprofit employers have been granted injunctions.

Challenges take separate tracks

Several types of contraception mandate challenges are working their way through the federal courts with hopes of ultimately landing before the Supreme Court.

In addition to challenges by employers who argue that the law’s requirements violate the religious beliefs of those who run the organizations, lawsuits have also been filed by employees of companies that provide contraception coverage through their health plans, arguing that those plans allow for contraception to be provided to covered children of insured employees who may have religious objections.

So far, the U.S. Supreme Court has agreed to take up the issue of whether the law violates the rights of for-profit groups. On March 25, the justices will hear arguments in the consolidated cases of Conestoga Wood Specialties Corp. v. Sebelius, No. 13-356 (from the 3rd Circuit), and Sebelius v. Hobby Lobby Stores Inc., No. 13-354 (from the 10th Circuit).

The challengers in those cases assert that religious owners of for-profit businesses do not abdicate their free exercise rights when they act as employers.

“They are living their faith out in the world, out in the marketplace,” said Jason Miller, an associate at Miller, Johnson, Snell & Cummiskey in Grand Rapids, Mich. who represents Autocam Corp. in the 6th Circuit case Autocam Corp. v. Sebelius.

The certiorari petition before the high court in that case, No. 13-482, is on hold pending the decision in Hobby Lobby and Conestoga.

The federal government asserts that the challengers’ interpretation “would expand the scope of the RFRA far beyond anything Congress contemplated.

“A group health plan covers many items and services, and participants and their dependents, in consultation with their health-care providers, decide which ones to use. Those decisions by independent third parties are not attributable to the employer that finances the plan or to the individuals who own the company, and the connection is too indirect as a matter of law to impose a substantial burden,” wrote Solicitor General Donald Verrilli Jr. in a brief filed on behalf of Health and Human Services Secretary Kathleen Sebelius.

A decision in the for-profit cases will come before the term ends in June. Follow @dcdicta