Monday, May 16, 2016

Supreme Court's Decision in Zubik v. Burwell

Last December I wrote a loooonnnngggg post about the issues in Zubik v. Burwell, the contraceptive mandate case. This case promised to be one of the most significant decisions of the Supreme Court's 2015-2016 term. Today, the case closed softly, in what the media is calling a "compromise" resolution. (Today's decision of the Court in Zubic v. Burwell is available here.) But make no mistake -- the winners are employees who are now guaranteed contraceptive coverage at no cost.

The Affordable Care Act requires employer-sponsored health insurance to cover preventive care at no cost to their employees, and the Department of Health and Human Services categorized contraception as a form of preventive care. In the Hobby Lobby case, decided in 2014, two family-owned for-profit corporations challenged the birth control mandate under the federal Religious Freedom Restoration Act. Those companies won. The Supreme Court ruled that it would be a "less restrictive alternative" for the employer to give this notice to their insurance companies and for those insurers to provide the coverage free of charge, rather than requiring the employer to purchase such coverage from their insurers. The Court ruled in favor of the private employers by a vote of 5-4, Justice Scalia voting with the majority.

In this case, Zubic v. Burwell, the "opt-out" procedure itself is being challenged as a violation of the Religious Freedom Restoration Act.

Churches and their integrated organizations are exempt from the birth control mandate, but independent religious nonprofits need to request an exemption by filing a form ("Form 700") with their insurer or with the government. The Little Sisters of the Poor and a number of other independent religious nonprofits objected to this "opt-out" procedure, contending that this made those organizations "complicit" in the sin of providing access to birth control. They filed suit under the federal Religious Freedom Restoration Act essentially arguing that there must be a "less restrictive alternative" that would not even require them to take the step of notifying the government of their religious objections to contraception.

Justice Antonin Scalia passed away the night of February 12-13.

Oral argument on March 23 in this case was contentious; it was difficult to predict how the Court would resolve the case.

On March 29, 2016, the Supreme Court issued an unusual order in Zubik. The Court required the parties to submit supplemental briefs addressing whether it would satisfy the statute if the employer simply notified the insurer at the time that it purchased the insurance that the employer had a religious objection to contraception and that the employer did not want coverage for contraception included in the plan. In such a case, as in Hobby Lobby, the insurer would then have to provide birth control coverage at not charge to the employees by means of a separate plan.

In their supplemental briefs both the government and the religious nonprofits agreed that such a solution would be acceptable -- that it would be a less restrictive alternative -- but both parties then sought to "clarify" all of the problems with that solution. This morning the Supreme Court ruled that since the parties had essentially consented to this procedure, it meant that it was unnecessary for the Court to rule on the matter, and it remanded the case to the lower courts to hammer out the details of the settlement. In that sense the religious nonprofit organizations won -- the compromise procedure is in effect a "less restrictive alternative" to Form 700.

However, I think that this has to be regarded as a clear victory for the employees of the religious nonprofits. In the course of its decision today, the Supreme Court stated that any compromise must guarantee employees' rights under the Affordable Care Act to free access to birth control. The Court stated:
"Nothing in this opinion, or in the opinions or orders of the courts below, is to affect the ability of the Government to ensure that women covered by petitioners’ health plans 'obtain, without cost, the full range of FDA approved contraceptives.'"
In my opinion it was a strategic mistake for the religious nonprofits to consent to the Court's proposed solution. They should have forthrightly objected to this solution and rolled the dice. They chose to be clever -- too clever by half -- and while they may have "won" in the sense that they won't have to file Form 700, they still have to notify their insurer of their religious objection to contraception, triggering the insurer's obligation to provide that coverage free of charge.

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