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Business Owners Who Oppose Obamacare's Birth Control Mandate Want Employees Just Like Them

Conscience challenges to the ACA contraceptive coverage mandate may bring surprise risks to small business owners
 
 
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The following is reprinted with permission from  Religion Dispatches. You can sign up for their free daily newsletter  here.

On January 8, a small Minnesota-based medical device company,  Annex Medical, Inc., lost its  preliminary bid to avoid offering its employees health insurance policies that cover contraception.

Because Annex has only 16 full-time and two part-time employees, the Affordable Care Act, or “Obamacare,” does not require it to provide health insurance to its workers at all. (Only businesses with 50 or more employees are required by the new law to provide insurance.) However, if Annex chooses to offer its employees insurance, its plan—like those of larger companies—must comply with the minimum requirements for preventive health care services, including contraceptive services.

In keeping with emphasis of the Affordable Care Act (ACA) on “wellness,” the law requires most insurance plans to cover preventive health care services without co-pays. Government regulations spell out which services are covered, and among women’s preventive services are all FDA-approved contraceptive methods and sterilization procedures, along with patient education and counseling.

Since the regulations were announced, the “contraception mandate” has been the cause of great controversy, as many non-profit religious organizations, including Catholic hospitals and religiously-affiliated colleges, have objected to offering birth control services through their insurance plans.

The narrow exemption in the original rules, which were not broad enough to cover Catholic schools like Notre Dame, is undergoing a reevaluation. However, in addition to objections by religious non-profits, more than a dozen for-profit small businesses have filed lawsuits objecting to furnishing coverage for some or all contraceptive services because of the owners’ religious beliefs. That’s the case with Annex Medical.

Annex’s owner, Stuart Lind, is a devout Catholic. In 2001, he made a formal commitment to operate his business in accordance with the teachings of Jesus through a Catholic ceremony that consecrated the business to the  Sacred Heart of Jesus. Like challenges made by other Catholic-owned small businesses, Lind objects to all aspects of the contraceptive coverage mandate. Challenges by non-Catholic Christian-owned firms usually object only to emergency contraceptive methods, which some argue may prevent implantation of an already fertilized egg, and to IUDs which can prevent implantation. These methods are seen by some anti-abortion advocates as not merely a form of contraception but as “abortifacients” that stop a pregnancy after conception.

The lawsuits that have been filed by businesses like Annex challenge the ACA’s contraception mandate on a number of grounds. The most significant challenge invokes the federal Religious Freedom Restoration Act, claiming that the insurance coverage mandate imposes a substantial burden on the free exercise of religion. Annex Medical lost its claim because the court concluded that the mandate does not impose a substantial burden on religious exercise and in the widely-publicized Hobby Lobby case, the court reached the same result. But other judges have reached the opposite conclusion.

The Affordable Care Act generally imposes its insurance requirements on businesses that operate either as corporations or as limited liability companies (LLC)—a hybrid business model that combines elements of a corporation and a partnership. For either sort of company, the contraceptive mandate applies to the business itself, not its owners. For large businesses, this distinction is clear: the health insurance mandate applies to General Motors, not its thousands of shareholders. However, with small businesses, the line between business and owner is often more blurred, creating a multitude of legal complications.

When companies like Annex sue over the contraception mandate, the lawsuits are usually filed in the name of both the business and its owners, and the complaint about whose rights to the free exercise of religion are at issue can become ambiguous. Can business owners assert that their free exercise is being burdened when the coverage mandate is imposed not on them, but on their business? Does the for-profit corporation or LLC have religious beliefs of its own? Does General Motors practice religion? If not, do smaller corporations exercise religion? Or are the small businesses really asserting the religious rights of their owners?