Thursday, July 21, 2016

UPDATE: Zubik remand developments: (i) Federal Govenrment notifies Zubik petitioners' insurers and TPAs they must begin providing contraceptive payments; and (ii) agencies promulgate Request for Information on whether other alternatives might also work

Marty Lederman

Today, in each of the courts of appeals to which the "nonprofit" contraception cases have returned from the Supreme Court after the Court's remand in Zubik, the Department of Justice notified the courts that, in the cases involving insured plans and self-insured, nonchurch plans, the government will now proceed to notify known insurance issuers and third-party administrators, respectively, that they have an "obligation to make or arrange separate payments for contraceptives, without cost to or involvement by plaintiffs."  [The link is to the Zubik notice in the Court of Appeals for the Third Circuit; but they're all materially identical.]

This action by the federal agencies is consistent with the Court's directive that "[n]othing . . . in the opinions or orders of the courts below, is to affect the ability of the Government to ensure that women covered by [plaintiffs’] health plans “obtain, without cost, the full range of FDA approved contraceptives.”  In other words, the government is taking steps to ensure that women are receiving payments for contraception during the pendency of the cases (which is an especially apt development for the status quo because the government is likely to prevail in those cases).  (Of course, the government cannot notify an issuer or TPA if it does not know who they are; in most of the cases, however, the employers have willingly provided that information in the course of litigation.)

As I've explained, the government does not have the legal authority to require TPAs of self-insured "church plans" to provide payments.  Therefore,  in the case of empployers that have identified their employees' or students' plan as a self-insured church plan, "the Departments will notify the TPA of the incentive available under the regulations [for them] to [voluntarily] make or arrange separate payments for contraceptives."

Meanwhile, this morning the Departments of Health and Human Services (HHS), Labor, and Treasury issued a Request for Information (RFI) in light of the Court's remand.  The RFI invites public comments concerning whether there are alternative ways (other than those offered in current regulations) for eligible organizations that object to providing coverage for contraceptive services on religious grounds to obtain an accommodation, while still ensuring that women enrolled in the organizations’ health plans have access to seamless, cost-free coverage of the full range of FDA-approved contraceptives.  The agencies explain that they "are committed to respecting the beliefs of religious employers that object to providing contraceptive coverage," and "have consistently sought to accommodate religious objections to the contraceptive-coverage requirement even where not required to do so by RFRA."

The Departments are using the RFI procedure "because the issues addressed in the supplemental briefing in Zubik affect a wide variety of stakeholders, including many who are not parties to the cases that were before the Supreme Court.  Other employers also have brought RFRA challenges to the accommodation, and their views may differ from the views held by the employers in Zubik and the consolidated cases.  In addition, any change to the accommodation could have implications for the rights and obligations of issuers, third party administrators, and women enrolled in health plans established by objecting employers."

Comments are due, by my calculation, on September 20.

Among other things, the agencies have invited comments on the following questions:

-- Whether the alternative procedure described by the Court would resolve the RFRA objections of objecting organizations with insured plans.  (We already know that the Zubik petitioners themselves would continue to interject a RFRA objection, no matter how untenable it might be.  But there are many other organizations at issue, too.)  And, for any organization that would continue to assert a RFRA objection, could that objection "be resolved by any procedure(s) or system(s) in which the organization’s issuer provides contraceptive coverage"?

-- Recall that the Zubik petitioners represented to the Court that their RFRA objections would only be alleviated, as to insured plans, if (i) the insurance company is required to offer women the opportunity to enroll in separate, contraceptive-only insurance policies, rather than providing separate direct payments to the women, outside any insurance plan, for contraceptive services; and (ii) that the affected women are required to take affirmative, "opt-in" steps to enroll in those contraceptive-only policies, rather than being automatically eligible for payments by the issuer for contraceptive services.  The agencies have asked for comments on the impact this approach would have on the ability of women enrolled in group health plans established by objecting employers to receive seamless coverage for contraceptive services; on whether the approach would be feasible for health insurance issuers; and whether there would be state-law obstacles to such an approach.

-- "Are there alternative procedure(s) or systems (without relying on contraceptive-only policies or imposing an affirmative enrollment requirement) that would resolve objecting organizations’ RFRA objection to the accommodation," with respect to insured plans?

-- As to self-insured plans, the agencies "have not identified any viable alternative to the existing accommodation," and thus they "they seek comment on any possible modifications to the accommodation for self-insured plans, including self-insured church plans that would resolve objecting organizations’ RFRA objections while still providing seamless access to coverage."  In particular, "are any reasonable alternative means available under existing law by which the Departments could ensure that women enrolled in self-insured plans maintained by objecting employers receive separate contraceptive coverage that is not contracted, arranged, paid, or referred for by the objecting organization but that is provided through the same third party administrators that administer the rest of their health benefits?," and would such alternative mechanisms satisfy the RFRA objections of objecting organizations with self-insured plans?

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