Religious exemption carries in U.S. Supreme Court decision on preventive reproductive care

Until this week, federal law required most insurance plans to cover the cost of birth control without a copay. However, the history behind this issue can be traced back much further.

Initially, the Patient Protection and Affordable Care Act (ACA) required no-copay coverage of birth control. Houses of worship were automatically exempt from this mandate, while other nonprofit and religiously-affiliated entities were not. Those not automatically exempt could opt out and notify the insurer. This ensured that ACA-compliant coverage was still available to the employee but not at a cost to the employer. In 2014, the U.S. Supreme Court ruled that family-owned businesses that had religious objections to paying for employees’ birth control in company-sponsored group health plans could opt out of the requirement. But, some employers still objected to the need to opt out.

Federally, the Trump administration issued a series of rules aimed at reproductive health care providers and services, particularly the birth control opt-out. Meanwhile, states vary widely on insurance regulations, with disparities in coverage of contraceptives, cost-sharing and religious exemptions. In the end, the Trump administration was challenged in court and prevailed. The Court ruled that the administration has the power to grant opt-outs to employers that object to birth control on religious or moral grounds, finding that it was a reasonable accommodation between church and state.

In summary, this decision expands the ability of employers to exempt themselves from providing birth control coverage to employees without a copay. Many religiously-affiliated employers have always refused to cover all costs for birth control, much less without a copay. Their employees at least know the landscape. However, for the employers awaiting this decision, it means increased costs to many employees due to loss of full or partial birth control coverage.

Every insurer knows that birth control is far more affordable than the cost of every aspect of childbirth, so it will be interesting to see how insurers react to plans that use this exemption. It will be even more interesting to see if an employer’s moral objection to birth control can withstand the practical consequences to its bottom line, such as increased cost of covering more births or higher premiums generally, losing employees who decide to stay home with children or employee flight to employers with full coverage of birth control.