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Some fight, some fold in Obamacare contraception conflict

Certain businesses refuse to comply

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Some of the business owners who sued the Obama administration over the "contraception mandate" tied to the health care law are insuring employees' birth control against their will — now that the rule is in effect — or refusing to comply in an act of civil disobedience.

While many companies have obtained court orders excusing them from the obligation while they challenge the law, at least seven for-profit businesses were unable to get a temporary reprieve, leaving them to decide whether to obey the mandate or ignore it and risk substantial fines.

One plaintiff, Mersino Management, a water management company based in Metamora, Mich., has spurned the mandate even though it should have taken effect at the self-insured company June 1.

"They can't violate their conscience, so they're not," said Erin Mersino, trial counsel at the Thomas More Law Center in Ann Arbor, Mich., adding that the groundwater control company — owned by her husband's parents — has not been notified of potential sanctions.

Other companies that objected to the Obama policy have decided to play it safe and offer coverage for now even as they pursue their court cases.

Conestoga Wood Specialties in Pennsylvania is complying with the mandate, as is MK Chambers, a Michigan-based machinery company whose owners are devout Catholics. The company has been subject to the mandate since the beginning of the year.

After the Affordable Care Act passed in 2010, the Obama administration issued a rule requiring businesses with 50 or more workers to provide health plans that include coverage for FDA-approved contraceptives.

The mandate prompted a flurry of lawsuits and has split federal appellate courts, setting up a potential showdown in the Supreme Court on whether the requirement violates an employer's right to express religious freedom. Supporters of the mandate say it is not overly burdensome and that employers cannot impose their personal beliefs on a diverse workforce that may not share their moral values.

The rule applies to for-profit company health plans issued during or after August 2012. That means virtually all corporate employers who objected to the requirement are now subject to it after renewing their annual policies at some point in the past year.

It's unclear what will happen to companies such as Mersino Management that are flouting the law, and the enforcement issue appears to have caught the administration off guard.

The Department of Health and Human Services, which administers most of the law, referred questions to the Labor Department, saying it's that department's job to police employers. A Labor spokeswoman said the department did not have a statement on the issue.

So far, 24 for-profit plaintiffs have obtained relief from the mandate in court, while five additional plaintiffs have filed suit and are awaiting action, according to the Becket Fund for Religious Liberty, which is keeping track of the lawsuits.

Houses of worship are exempt from the mandate, and the administration has come up with a special formula for religiously affiliated organizations such as charities or colleges to have employees covered without forcing the organizations themselves to pay for it. But for-profit corporations have not been granted any leeway from the Obama administration.

Four of the seven for-profit companies under pressure to comply with the mandate are clustered in Michigan, and attorneys there say judges within the 6th Circuit Court of Appeals do not seem eager to grant relief.

Mrs. Mersino said one company, Eden Foods of southeast Michigan, refused to sign an insurance agreement that would have covered contraceptives, but the issuer decided to include birth control without the company's consent, placing the owners in unwitting compliance with the mandate.

Autocam Corp., a Kentwood, Mich.-based company that lost a preliminary request for an injunction and is hoping to succeed on the case's merits this summer, is "being forced to comply with the mandate because the fines will destroy their business and they are unwilling to subject their employees to risk of financial ruin if stripped of health coverage," attorney Jason C. Miller said.

While legal battles stew in the upper Midwest, federal appellate judges in other parts of the country have come down on either side of the issue.

Oklahoma City-based Hobby Lobby scored a legal victory in mid-July, when the 10th Circuit Court of Appeals granted a preliminary injunction that protects the crafts store chain until its case is decided on its merits. But the majority of the 3rd Circuit Court of Appeals diverged from that view days later when it offered no relief to Conestoga Wood Specialties.

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