5 questions about the Hobby Lobby case and contraceptive coverage

The Supreme Court will hear arguments on Tuesday in two related cases which involve a challenge to regulations in the Affordable Care Act that require many employers to include free coverage of contraceptive services in their employees’ health insurance plans. These cases – Sebelius v. Hobby Lobby Stores, Inc. and Conestoga Wood Specialties Corp. v. Sebelius –  should not be confused with court challenges to the contraceptive mandate by religiously affiliated nonprofits, which also may soon be reviewed by the Supreme Court.

Here are five questions that explain what these cases are about and why they are important:

The owners of both companies  are devout Christians who oppose abortion and do not want to provide their employees with emergency contraception because they believe such methods often destroy embryos. The Affordable Care Act exempts churches and provides religiously affiliated nonprofits, such as hospitals and charities, with an alternative mechanism for ensuring that their employees are covered. But those accommodations do not extend to for-profit employers who may also have religious objections to artificial birth control. The owners of a number of these businesses sued the federal government, claiming that the Religious Freedom Restoration Act (RFRA) entitles them to be exempted  from the mandate. 

RFRA was passed by Congress in 1993 in response to a 1990 Supreme Court decision, Employment Division v. Smith, which made it more difficult for individuals and groups to get exemptions from laws and government actions that may burden religious practice. Prior to the decision, the government needed to prove it had a “compelling interest” (e.g., protecting public safety) in applying a law that burdened someone’s religious practice. After Smith, the government only needed to show that it had a “legitimate interest” which is a much less rigorous standard. The 6-3 Smith decision prompted an outcry from religious groups and others, who claimed that the ruling would essentially gut religious liberty protections contained in the First Amendment. Congress responded by passing RFRA, which restored the tougher, pre-Smith (“compelling interest”) standard in cases where someone’s religious rights have been “substantially burdened.” But while RFRA applies to religious groups and individuals, it is unclear whether its protections extend to for-profit businesses.

The companies claim that RFRA protects the religious liberty of for-profit businesses. To begin with, they say, Congress did not explicitly exclude businesses from coverage when it passed RFRA in 1993. Indeed, the statute claims to cover “persons,” a word courts usually interpret to include nonprofit and for-profit entities as well as individuals. Hobby Lobby and Conestoga also argue that the contraception mandate imposes a “substantial burden” on their free exercise of religion by forcing them to provide a service deemed sinful in their faith tradition.  Finally, the companies say, the contraception mandate cannot possibly advance a “compelling” public policy interest because the government already has exempted thousands of religious groups and others from the mandate.

The government counters that RFRA does not protect for-profit corporations such as Hobby Lobby and Conestoga because there is no indication that Congress intended the statute to cover for-profit businesses, nor is there any tradition of courts extending religious liberty protections to businesses or their owners. Even if RFRA does apply, the government contends, the contraception mandate does not rise to the level of being a “substantial religious burden” because the companies are significantly removed from an employee’s decision to use contraception. And, even if the mandate does constitute a “substantial burden” on some employers, the government argues that it also advances a “compelling” interest because it is part of a comprehensive reform of the nation’s health care system.

If the government prevails because the court rules that RFRA does not apply to businesses, the decision would immediately end all religious liberty-based challenges to the contraception mandate by for-profit entities as well as other RFRA-based challenges by businesses.  At the same time, if the court rules that RFRA does apply to businesses but that the mandate either doesn’t substantially burden their religious rights or that the government has a compelling interest in applying the law, it would likely bode ill for upcoming legal challenges to the mandate by religious nonprofits. However, if the court rules in favor of Hobby Lobby and Conestoga, the decision would likely open the door for businesses to invoke RFRA in a wide range of challenges to federal laws. For instance, a decision in favor of Hobby Lobby and Conestoga might give for-profit employers a strong legal foundation to raise religious objections to hiring gays and lesbians or to providing the same-sex spouses of employees with the same benefits extended to opposite-sex spouses. Such a decision also would almost certainly mean that nonprofits would be fully exempt from the mandate.