The Obama administration on Friday rolled out a revised rule that gives religious institutions the option to divorce themselves from a mandate in the president's health care law that requires insurance plans to cover contraception for their employees.
The original regulation sparked a political uproar and dozens of lawsuits from religious organizations and private businesses, who said the mandate would force them to violate their religious and moral principles or face legal and financial penalties.
The new proposal from Department of Health and Human Services would allow religious nonprofits such as hospitals and universities that object to the mandate to receive an accommodation that still provides their employees separate contraceptive coverage with no co-pays, "but at no cost to the religious organization."
Chiquita Brooks-LaSure, a deputy director at the Center for Consumer Information and Insurance Oversight, said that, under the proposed rule, "insurance companies — not churches or other religious organizations — will cover contraceptive services."
But early reaction to the new rule was mixed, with pro-choice groups hailing the language while those who opposed the original mandate either noncommittal or still unhappy with the new plan.
The Alliance Defending Freedom, a self-described "legal ministry" that is litigating several of the corporate cases, said Mr. Obama's gesture on Friday fell short.
"All Americans, not just those in church organizations, are guaranteed freedom of conscience in their daily lives and work," ADF senior counsel Matt Bowman said. "The administration's narrow gesture does nothing to protect many faith-based employers or religious families from the unconstitutional abortion pill mandate."
HHS officials envision a system in which insurance issuers or a third-party administrator — depending on whether an employer uses a group health plan or is self-insured— will offer the contraception coverage to enrollees and then see savings through a deduction in the user fees they would normally pay to be part of a state-based insurance exchange as part of Mr. Obama's law.
Officials said issuers should also recognize savings that come from the health benefits of offering contraception.
No federal funds will be expended under the plan, although ostensibly federal and state governments will be losing out on the fees that would normally paid to participate in the exchanges, officials said. The plan will be open to comments from interested parties through April 8.
"It is important to realize these proposals are just that — proposed — and not final," Ms. Brooks-LaSure told reporters in a conference call.
But it appeared unlikely that the new rules will placate the dozens of religious nonprofits and corporate owners that have filed lawsuits to protest the mandate contained in Mr. Obama's sweeping new health care law, which passed in 2010 and was largely upheld by the Supreme Court last June. The plaintiffs say the use of preventive contraception or "morning-after" pills is at odds with their religious beliefs.
Defenders of the modified mandate noted Friday that religious officials and business owners will not have to use the contraceptives or pay to supply them directly to their employees.
Actual houses of worship were already exempt from the contraception mandate. Corporations, however, started to face fines this year.
Under the new rule, religious organizations with group health plans must self-certify that they object to the mandate. The insurer would then provide enrollees with no-cost contraceptive coverage through a separate individual health insurance policy, according to HHS.
For organizations that "self-insure" and claimed the original rule was unworkable for them, a third-party administrator "would work with an insurer to arrange no-cost contraceptive coverage through separate individual health insurance policies."
Pro-choice groups immediately hailed the news of the revised mandate, but the nation's Catholic bishops took a far more guarded view and one pro-life priests' group said the compromise was still unacceptable.
"This policy makes it clear that your boss does not get to decide whether you can have birth control," Planned Parenthood Federation of America said in a statement, while the progressive Catholics United said the new language was one both sides should be able to rally around.
But the U.S. Conference of Catholic Bishops would only say that it was still studying what the HHS was proposing and would comment later.
And Fr. Frank Pavone, national director of Priests for Life, which filed one of the lawsuits challenging the original mandate, said his group's objections "to contraceptives and abortion-inducing drugs aren't based just on dogmas and Bibles, but on adverse health consequences and the fact that human beings, no matter how small, should not be killed."
"We see only one acceptable change regarding the mandate: rescind it completely," Fr. Pavone said.
Federal health officials are also attempting to clarify the definition of a "religious employer," beyond just houses of worship, that are exempt from the mandate by aligning it with a standard definition used in the Internal Revenue Service's tax codes. Among those challenging the mandate were Catholic University of America, Notre Dame, the Eternal Word Television Network and Houston Baptist University.
HHS officials gave no indication that they would be providing an accommodation to corporate owners who opposed the mandate, nor would they comment on pending lawsuits.
U.S. circuit courts have been divided on whether the mandate violates a corporate owner's religious freedoms, signaling the issue may be headed for the Supreme Court. So far, nine out of 15 federal courts have given companies a temporary reprieve from the mandate's penalties.
Hobby Lobby Stores Inc., an Oklahoma City-based arts-and-crafts franchise with more than 500 stores in 41 states, made headlines this month when it found a way to duck the mandate's penalties by delaying its insurance year by several months.
Religious nonprofits find themselves somewhere in between their corporate counterparts and actual churches.
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