Court Ruling: Hobby Lobby Cannot Deny Contraceptive Coverage to its Employees

By Amal Bass, WLP Staff Attorney

On November 19, 2012, an Oklahoma federal court denied Hobby Lobby’s motion for a preliminary injunction, telling the business and its co-plaintiff (Mardel, another business owned by the same family trust) that they would be unlikely to succeed in their legal challenge to the contraceptive coverage rule under the Affordable Care Act (ACA).  This rule makes contraception more affordable for women by requiring new or renewed insurance to cover the cost without co-pays or deductibles as of August 1, 2012.

Religious organizations, like houses of worships, are exempt from providing such coverage, and the Obama Administration has proposed an “accommodation” for other religious organizations under certain circumstances.  Just yesterday, November 27, 2012, a Pennsylvania federal court dismissed a lawsuit by the Catholic Diocese of Pittsburgh, Catholic Charities, and Catholic Cemeteries Association as premature because, unlike Hobby Lobby, several exceptions to the contraceptive coverage rule apply to them at the present time either because they are religious organizations or have grandfathered plans.  Most v. Sebelius, No. 12-cv-00676, 2012 U.S. Dist. LEXIS 167737 (W.D. Pa. 2012).  Hobby Lobby, as a private, for-profit business, is in a different situation; it does not fit within the accommodation or exemptions.

In its lawsuit, Hobby Lobby and Mardel claimed that requiring contraceptive coverage in the health plans they offer to their employees violates their rights under the First Amendment of the U.S. Constitution and the Religious Freedom Restoration Act of 1993 (RFRA).  In particular, Hobby Lobby protested coverage for contraceptive methods that it wrongly believed to be abortifacients, such as Emergency Contraception (EC), which does not cause abortions because it works by preventing the ovary from releasing an egg, not by disturbing a fertilized egg implanted in the uterus.

The United States District Court for the Western District of Oklahoma ruled against Hobby Lobby and Mardel, concluding that the companies were not entitled to a preliminary injunction because:

Hobby Lobby and Mardel, [being] secular, for- profit corporations, do not have free exercise rights. The [owners] do have such rights, but are unlikely to prevail as to their constitutional claims because the preventive care coverage regulations they challenge are neutral laws of general applicability which are rationally related to a legitimate governmental objective.

Plaintiffs also have failed to demonstrate a probability of success on their Religious Freedom Restoration Act claims. Hobby Lobby and Mardel are not ‘persons’ for purposes of the RFRA and the Greens have not established that compliance with the preventive care coverage regulations would ‘substantially burden’ their religious exercise[.]

Essentially, the court concluded that, for the purposes of free exercise of religion, corporations are not people and do not have such rights.  Their owners have religious freedom rights, but broadly applicable, neutral laws like the ACA do not infringe on these constitutional or statutory rights.  Legal challenges waged by secular, for-profit businesses against the contraceptive coverage rule in other lower federal courts, however, have resulted in mixed results.

It is important that our federal courts protect the contraceptive coverage rule from attacks like the one at the heart of Hobby Lobby v. Sebelius.  Business owners should not be able to impose their personal religious beliefs on their employees, who come from a wide range of backgrounds.  Depending on the method used, contraception can cost between $15 and $1,000 up front, and the contraceptive coverage rule ensures that fewer women will pay out-of-pocket for birth control, which is not only important for family planning but also to address other health concerns, such as polycystic ovarian syndrome.

To learn more about the Affordable Care Act and reproductive health care, see our report, Through the Lens of EQUALITY: Eliminating Sex Bias to Improve the Health of Pennsylvania’s Women.

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