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Contraceptive mandate still in play

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The Supreme Court's decision to send contraceptive mandate challenges back to half a dozen appeals courts will leave the parties in search of a compromise that may be difficult, if not impossible, to find.

Some say the high court's decision last week in The Rev. David A. Zubik et al. v. Sylvia Burwell et al., in which it declined to rule on the Affordable Care Act mandate imposed on employers and challenged by religiously affiliated nonprofit organizations, could mean there's a 4-4 split on the merits of case.

The court has had eight members since the February death of Associate Justice Antonin Scalia, and Senate Republicans have vowed to block any nominee by President Barack Obama.

The eight-member Supreme Court unanimously told the federal government and religious nonprofits that ideas had been presented to allow them to “resolve any outstanding issues between them” on the accommodation to the health care reform law mandate that requires the nonprofits to notify their insurers, third-party administrators or the government about their objection to providing contraceptive coverage, with the insurers or TPAs then providing the coverage.

The objecting nonprofits — mostly religiously affiliated universities and colleges, nursing homes, charities and Roman Catholic clergy — feel the 2013 accommodation is too onerous and still violates their faith and rights under the 1993 Religious Freedom Restoration Act.

In two orders, the high court vacated rulings on 13 cases challenging the mandate in the 3rd, 5th, 7th, 8th, 10th and District of Columbia appeals courts. All of the appellate courts previously upheld the government's rule except for the 8th circuit, which issued a preliminary injunction.

While the court said there was “substantial clarification” of the parties' positions regarding the accommodation through highly unusual supplemental briefs it had the parties file in April, it's unclear how a compromise would be forged.

Experts say the court did not provide a clear path to resolve the issue, and the case could wind up back before the high court once a ninth justice is seated.

“It's questionable to me on how that's going to resolve the issue seeing as how (the lower courts) were not able to agree in the first place,” said Amy Gordon, Chicago-based co-chair of the health and welfare benefits affinity group at law firm McDermott Will & Emery L.L.P.

“The remand just keeps this issue alive with the possibility that it won't be resolved during the current term of the court,” said Steven J. Friedman, co-chair of the employee benefits practice group at Littler Mendelson P.C.

Religious nonprofits, however, hailed the ruling.

“We are encouraged” by the ruling, the Rev. Frank Pavone, national director of Priests for Life, which challenged the accommodation, said in a statement.

“It is only a matter of time before the lower courts make this victory permanent,” Mark Rienzi, senior counsel at The Becket Fund for Religious Liberty, which represents objecting nonprofit Little Sisters of the Poor, said in a statement.

Others were less satisfied.

“We are disappointed that the court did not resolve once and for all whether the religious beliefs of religiously affiliated nonprofit employers can block women's seamless access to birth control,” Gretchen Borchelt, vice president of reproductive rights and health at the National Women's Law Center, said in a statement.

“This was really an attempt to keep this issue away until there was a 9th member of the Supreme Court,” said Aaron Goldstein, Seattle-based partner with law firm Dorsey & Whitney L.L.P.

“The avoidance of a 4-4 split certainly was my interpretation,” said Tami Simon, Washington-based global practice leader of the Knowledge Resource Center at Xerox HR Services.

A split would have let the lower courts' rulings stand, creating different laws in different states.

Saying the opposing parties conceded in the supplemental briefs that the accommodation could be modified “in a way that does not require any involvement of petitioners,” the Supreme Court seems to be “saying this is what these people said on paper, this is what they've agreed to, so now make them work out the details,” said Robin Fretwell Wilson, a law professor and director of the College of Law's Family Law and Policy Program at the University of Illinois at Urbana. “I think they are holding the government to their promise.”

But the parties did not agree on how to modify the accommodation to the contraceptive mandate.

The nonprofits said in their supplemental briefs that they would be satisfied if contraceptive coverage was offered to their employees “through a separate policy, with a separate enrollment process, a separate insurance card, and a separate payment source, and offered to individuals through a separate communication.”

But the government countered that separate contraceptive polices would be “unworkable” and create a barrier to the “seamless” coverage under the law.

In a concurring opinion joined by Associate Justice Ruth Bader Ginsberg, Associate Justice Sonia Sotomayor said “such separate contraceptive-only policies do not currently exist” and if they did, “requiring stand-alone contraceptive-only coverage would leave in limbo all of the women now guaranteed seamless preventive-care coverage.”

Observers also point out that the Supreme Court's ruling clearly said the contraceptive policies should be provided by the nonprofits' same insurers, but say that would work only for fully insured employers, not those that are self-insured.

About 63% of covered U.S. workers are part of a self-insured health plan, according to the latest Kaiser Family Foundation data.

“There is no insurer in a self-funded plan, so the mechanism the court is clearly contemplating doesn't exist for those kinds of plans,” Ms. Wilson said.

“There may be the possibility for a compromise for insured plans, but there's no glimmer of a compromise for self-insured plans,” said Timothy Jost, health care law expert and emeritus professor at the Washington and Lee University School of Law.

Observers say a compromise is still far off. Many aren't convinced that common ground will be found and say the case could end up back before the Supreme Court during the next administration.

“I'm thinking that the government is on its back heels here, and it's going to have to come up with the same plan for everybody in all of those different circuits,” Ms. Wilson said. “It may be that the religious objectors don't all see this the same way. There is real question about whether we just kicked the can down the road.”