{"id":551,"date":"2017-10-10T15:55:36","date_gmt":"2017-10-10T15:55:36","guid":{"rendered":"http:\/\/sonus.wpengine.com\/?p=551"},"modified":"2017-12-12T20:37:25","modified_gmt":"2017-12-12T20:37:25","slug":"legal-alert-trump-administration-releases-guidance-acas-contraceptive-coverage-mandate","status":"publish","type":"post","link":"https:\/\/sonusbenefits.com\/legal-alert-trump-administration-releases-guidance-acas-contraceptive-coverage-mandate\/","title":{"rendered":"LEGAL ALERT – Trump Administration Releases Guidance on ACA\u2019s Contraceptive Coverage Mandate"},"content":{"rendered":"

On October 6, 2017, The U.S. Departments of Health and Human Services (HHS), Treasury, and Labor (the \u201cDepartments\u201d) released interim final regulations allowing employers and insurance companies to decline to cover contraceptives under their health plans based on a religious or moral objection.\u00a0 The new rules \u2013 which are effective immediately<\/em><\/strong> \u2013 scale back Obama-era regulations under the Affordable Care Act (ACA) that require non-grandfathered group health plans to cover women\u2019s contraceptives with no cost-sharing, with limited exceptions for non-profit religious organizations or closely-held for-profit entities.<\/p>\n

The new regulations were released in two parts, one covering employers with moral objections<\/a> (the \u201cMoral Exemption\u201d), the other for those with religious objections<\/a> (the \u201cReligious Exemption\u201d).\u00a0 The regulations are scheduled to be published in the October 13, 2017 Federal Register.\u00a0 Within hours of their release, the Departments were sued by the Attorney Generals of California and Massachusetts, and the American Civil Liberties Union (ACLU), alleging that the regulations violate the Administrative Procedure Act, the Establishment Clause of the First Amendment to the Constitution, and the Equal Protection guarantee implicit in the Fifth Amendment to the Constitution.\u00a0 The lawsuits seek to stop implementation of, and invalidate, the regulations.\u00a0 Other states, including Virginia and Oregon, are exploring legal options to challenge the exemptions.<\/p>\n

Background on ACA\u2019s Contraceptive Coverage Mandate<\/h2>\n

Originally, the bill that became the ACA did not cover certain women\u2019s preventive services that many women\u2019s health advocates and medical professionals believed were \u201ccritically important\u201d to meeting women\u2019s unique health needs.\u00a0 To address that concern, the Senate adopted a \u201cWomen\u2019s Health Amendment,\u201d to the ACA, which added a new category of preventive services specific to women\u2019s health based on guidelines supported by the Health Resources and Services Administration (HRSA).\u00a0 Supporters of the amendment emphasized that it would reduce unintended pregnancies by ensuring that women receive coverage for \u201ccontraceptive services\u201d without cost-sharing.<\/p>\n

The ACA was enacted in March 2010.\u00a0 In 2011, the Departments issued regulations requiring coverage of women\u2019s preventive services provided for in the HRSA guidelines, which include all Food and Drug Administration (FDA)-approved contraceptives, sterilization procedures, and patient education and counseling for women with reproductive capacity, as prescribed by a health care provider.<\/p>\n

Once these rules took effect in 2012, women enrolled in most health plans and health insurance policies (non-grandfathered plans and policies) have been guaranteed coverage for recommended preventive care, including all FDA-approved contraceptive services prescribed by a health care provider, without cost sharing.\u00a0 Under rules released in 2013, exemptions were introduced for certain religious employers (generally churches and houses of worship), as well as \u201caccommodations\u201d for non-profit religious organizations that \u201cself-certify\u201d their objection to providing contraceptive coverage on religious grounds.\u00a0 Under the accommodation approach, an eligible employer does not have to arrange or pay for contraceptive coverage.\u00a0 Employers may provide their self-certification to their insurance carrier or third-party administrator (TPA), which will make contraceptive services available for women enrolled in the employer\u2019s plan, at no cost to the women or the employer.<\/p>\n

In 2014, regulations were published to establish another option for an employer to avail itself of the accommodation. Under these rules, an eligible employer may notify HHS in writing of its religious objection to providing coverage for contraceptive services.\u00a0 HHS or the Department of Labor, as applicable, will notify the insurer or TPA that the employer objects to providing coverage for contraceptive services and that the insurer or TPA is responsible for providing enrollees in the health plan separate no-cost payments for contraceptive services.<\/p>\n

In 2015, in response to the Supreme Court\u2019s decision in Burwell v. Hobby Lobby Stores, Inc.<\/em>, regulations were released that expanded the availability of the accommodation to include a closely held for-profit entity that has a religious objection to providing coverage for some or all contraceptive services.<\/p>\n

In May 2017, President Trump issued an Executive Order<\/a> that directed the Departments to consider amending the contraceptive coverage regulations in order to promote religious liberty.\u00a0 Specifically, the Executive Order instructed the Departments to \u201cconsider issuing amended regulations . . . to address conscience-based objections to the preventative-care mandate.\u201d\u00a0 These latest regulations are consistent with the Executive Order.<\/p>\n

Overview of the Moral & Religious Objection Regulations<\/h2>\n

The Regulations expand existing exemptions to the ACA\u2019s contraceptive care requirement. The Religious Exemption automatically exempts all employers\u2014non-profit and for-profit organizations alike\u2014with a religious objection to contraception from complying with the contraceptive care requirement.<\/p>\n

The Moral Exemption exempts all non-profit employers and non-publicly traded for-profit employers with a moral objection to contraception from complying with the contraceptive care requirement. The rules also give exempted employers the authority to decide whether their employees receive independent contraceptive care coverage through the accommodation process.\u00a0 In other words, by making the accommodation process voluntary for employers, employees would no longer be guaranteed the seamless coverage for contraceptive care that currently exists under the accommodation process.<\/p>\n

Entities that qualify for the exemptions include churches and their integrated auxiliaries, nonprofit organizations, closely-held for-profit entities, for-profit entities that are not closely held, any non-governmental employer, as well as institutions of higher education and health insurers offering group or individual insurance coverage.\u00a0 Publicly-traded companies, however, are not eligible for the Moral Exemption.\u00a0 The rules also appear to have been drafted separately to ensure that one remains if the other is struck down.<\/p>\n

Employers currently operating under the religious accommodation (or that operate under the voluntary accommodation in the future) who wish to revoke that status may do so and rely on the exemptions in the new regulations.\u00a0 As part of any revocation, the insurer or TPA must notify participants and beneficiaries in writing.\u00a0 If contraceptive coverage is being offered by an insurer or TPA through the religious accommodation process, the revocation will be effective on the first day of the first plan year that begins on or after 30 days after the date of the revocation.\u00a0 Alternatively, an eligible organization may give 60 days\u2019 advance notice under the ACA\u2019s Summary of Benefits and Coverage rules, if applicable.<\/p>\n

Next Steps and Impact on Employers<\/h2>\n

Although the Moral and Religious Exemptions are effective immediately, employers that plan to avail themselves of either exemption should exercise caution and consult with qualified ERISA counsel before making plan changes.\u00a0 The regulations are already under challenge, regarding both their substance and their accelerated effective dates.\u00a0 Also, in many states, contraceptive coverage is a state-mandated benefit.\u00a0 Practically, this means that employers sponsoring fully-insured non-grandfathered group health plans may be precluded from exercising either exemption because insurance carriers in those states would be required to write policies that provide such coverage.\u00a0 Moreover, an employer availing itself under either exemption may face private lawsuits from participants and beneficiaries under Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on sex.<\/p>\n

 <\/p>\n

Stacy Barrow, Esq.<\/em>
\nCompliance Director<\/em><\/p>\n\n\n\n
About the Author.\u00a0 <\/strong>This alert was prepared for Sonus Benefits by Stacy Barrow.\u00a0 Mr. Barrow is a nationally recognized expert on the Affordable Care Act.\u00a0 His firm, Marathas Barrow Weatherhead Lent LLP, is a premier employee benefits, executive compensation and employment law firm.\u00a0 He can be reached at sbarrow@marbarlaw.com<\/a>.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

On October 6, 2017, The U.S. Departments of Health and Human Services (HHS), Treasury, and Labor (the \u201cDepartments\u201d) released interim final regulations allowing employers and insurance companies to decline to cover contraceptives under their health plans based on a religious or moral objection.\u00a0 The new rules \u2013 which are effective immediately \u2013 scale back Obama-era…<\/p>\n","protected":false},"author":9,"featured_media":613,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"content-type":"","_mi_skip_tracking":false},"categories":[28],"tags":[],"acf":[],"yoast_head":"\nLEGAL ALERT - Trump Administration Releases Guidance on ACA\u2019s Contraceptive Coverage Mandate - Sonus Benefits<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sonusbenefits.com\/legal-alert-trump-administration-releases-guidance-acas-contraceptive-coverage-mandate\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"LEGAL ALERT - 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