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Supreme Court Agrees to Hear Challenge to Contraception Rule in Health Law

By Rebecca Adams and Melissa Attias, CQ Staff

November 26, 2013 -- The Supreme Court announced last week that it will take up another challenge to the health care law, this time focused on the constitutionality of a requirement that employer health plans cover contraceptives free of charge.

The high court will consider two cases, one brought by the Hobby Lobby craft store chain and a second by Conestoga Wood Specialties, both for-profit businesses.

The justices chose to consolidate the two cases. The order that was issued by the court called for a total of one hour for oral argument, which likely will come in March.

The most high-profile case involves Hobby Lobby Inc., an Oklahoma-based operation with 13,000 full-time workers. Hobby Lobby prevailed in lower court decisions.

The Pennsylvania company Conestoga Wood Specialties Corp., which is run by a Mennonite family, filed the other case. The lower courts ruled against that challenge.

The announcement comes after the justices met privately on Tuesday to decide which of the four cases, if any, to hear this term. A case needs four votes to be accepted for the high court's review, which is less than the majority of votes required for a ruling.

At the center of the controversy is a rule from the Department of Health and Human Services (HHS) that requires most employers to cover contraceptives approved by the Food and Drug Administration as a preventive service under the health care overhaul (PL 111-148, PL 111-152). The law requires that new health plans provide coverage for a range of preventive services without cost-sharing such as co-pays or deductibles.

While opponents say the requirement violates religious freedom, supporters say the way it's written strikes a balance between religious and reproductive rights. Religious institutions, such as churches and mosques, are exempt from the rule, and religious nonprofits, such as hospitals and charities, do not directly arrange or pay for the coverage.

But the HHS rule does not provide any special arrangements for businesses, even if their owners have religious objections to providing birth control coverage.

"We believe this requirement is lawful and essential to women's health and are confident the Supreme Court will agree," said White House spokesman Jay Carney. "The Administration has already acted to ensure no church or similar religious institution will be forced to provide contraception coverage and has made a commonsense accommodation for non-profit religious organizations that object to contraception on religious grounds. These steps protect both women's health and religious beliefs, and seek to ensure that women and families—not their bosses or corporate CEOs—can make personal health decisions based on their needs and their budgets."

A total of 96 lawsuits have been filed in federal court challenging the requirement, according to the National Women's Law Center. That tally includes 46 challenges from for-profit businesses.

The rule has also received attention in Congress, where lawmakers who oppose it have worked to advance legislation to exempt employers, insurers and individuals who object on religious or moral grounds. With Democrats in control of the Senate and the White House, however, none of those efforts have been successful. That's left many looking to the court as the best chance for action.

The Justice Department had requested that the court review the Hobby Lobby case. The Justice Department had said in court filings that allowing employers in for-profit businesses to refuse to follow federal rules "would disregard fundamental tenets of corporate law that distinguish between the rights and responsibilities of a corporation and those of its owners."

The court did not specify when it would hear the cases, but attorneys quickly speculated.

"The cases almost certainly will be argued on March 24, 25, or 26, which are the next available dates on the Court's calendar," Andrew J. Pincus, a partner at Mayer Brown, said in an email. "It seems likely that the decision will come at the end of the Court's tern —during the last week of June."

Lawmakers and interest groups reacted immediately to the news.

"I am very pleased that the Supreme Court will consider whether Obamacare is violating the religious freedom of employers," said Rep. Joe Pitts, R-Pa., the chairman of the House Energy and Commerce Health Subcommittee, who represents the district where Conestoga Wood Specialties is located. "Conestoga and people of faith across the nation are waiting to see if the court will protect their constitutional right to live out that faith in the marketplace."

The court did not say it had agreed to consider two other cases that had been under consideration: Autocam Corp. v. Sebelius and Liberty University v. Lew.

John Kennedy, the CEO of the Michigan-based Autocam business, said in a statement that although the family-owned company will not get a chance to argue its case before the Supreme Court, they were hopeful that the court would strike down the mandate. Kennedy said the requirement violates the family's beliefs because they are Catholic.

"If the mandate stands, we will be forced to make drastic and unwanted changes to our coverage that will place a tremendous burden on our employees and their families," said Kennedy.

Women's groups said that the companies' positions were intrusive and unfair.

"We urge the court to uphold the contraceptive coverage requirement, and let doctors and their patients decide which health services women need," said Debra L. Ness, president of the National Partnership for Women and Families. "No woman should be denied coverage for birth control because of where she works. "

The cases will test the limits of the 1993 Religious Freedom Restoration Act (PL 103-141) that said that the federal government cannot "substantially burden a person's exercise of religion" unless there is a "compelling" reason.

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