Pair of injunctions halt employer ACA contraceptive opt-out

Dive Brief:

In separate rulings handed down over a two-day span, federal judges temporarily halted a pair of rules from the U.S. Department of Health and Human Services (HHS) that would allow employers to opt out of the Affordable Care Act's (ACA) contraceptive mandate on the basis of either religious beliefs or moral convictions.
U.S. District Judge Haywood Gilliam, Jr. issued a preliminary injunction Sunday applying to 13 states that sued HHS, saying those states "face potentially dire public health and fiscal consequences" from the rules' implementation. Gilliam said the rule could deprive a large number of women of their statutory rights under the ACA declined to grant a nationwide injunction.
On Monday, however, U.S. District Judge Wendy Beetlestone granted a preliminary nationwide injunction blocking the opt-out's expansion, saying that disruptions in contraceptive coverage will lead to women suffering unintended pregnancies and other medical consequences."The negative effects of even a short period of decreased access to no-cost contraceptive services are irreversible," Beetlestone said.

Dive Insight:

This isn't the first time the two rules faced court challenges. Prior to the publication of the final versions of the rules, both Gilliam and Beetlestone halted interim final rules in Dec. 2017. Following those decisions, HHS released a revised pair of final rules in November 2018 that were again challenged by attorneys general from several states.

And even prior to these challenges, the ACA's contraceptive mandate has proved to be one of its more controversial aspects since its addition to the list of items by the ACA without need of a co-pay, according to analysts at the Kaiser Family Foundation. Though the law does exempt churches, religious orders and other "integrated auxiliaries" — organizations with primary financial support from churches — the exemption was expanded to include religious non-profits. Following high-profile cases including the U.S. Supreme Court's decision in Burwell v. Hobby Lobby Stores, Inc., this exemption was extended even further to closely held for-profits with religious objections to contraceptive coverage. According to HHS, it is the responsibility of exempted entities' insurers or third party administrators to provide contraceptive services as part of the accommodation.

Reactions to the rulings varied. On Twitter, the Planned Parenthood Action Fund called the rulings a victory; "This is a WIN for the 62 million women who gained access to affordable birth control through the ACA," one post read. But Trump administration officials argued that the federal agencies involved "reasonably exercised their rule-making authority," according to The Philadelphia Inquirer. "No American should be forced to violate his or her own conscience in order to abide by the laws and regulations governing our health-care system," Caitlin Oakley, an HHS spokesperson, said in a statement to the newspaper.

A Willis Towers Watson survey conducted amid healthcare reform debates in 2017 found that 59% of employers would keep contraceptive coverage, among other ACA provisions, even if not required to do so by law. That's important to note considering the majority of U.S. employers do provide some form of contraceptive coverage, according to data from the Society of Human Resource Management's 2018 Benefits Survey. HHS has previously said it anticipates about 200 employers would pursue waivers in the event the rules are implemented, though it also speculated more employers could do so but may not be open about their plans.

The government is likely to appeal the ruling, meaning more court-watching for employers. But in the broader view, employers' approach to contraceptive coverage is unlikely to change, according to Shandon Fowler, healthcare analyst and principal and founder of Four8 Insights, especially among larger employers. "It's generally a popular benefit and popularly perceived benefit." Instead, the larger issue may be the decision by medium-sized and small businesses to take advantage of the exemptions should the HHS rules survive a court battle. Because such entities employ a large segment of the U.S. workforce, the ramifications would be significant, Fowler said.