US to propose birth control exception for religious companies

The Obama administration will ensure access to birth control coverage for employees of closely-held companies that object to contraception on religious grounds, proposing a new accommodation to health benefits mandated by the Affordable Care Act, a source familiar with the plan said on Friday.

The move follows a Supreme Court ruling in June that allowed certain for-profit companies to refuse to cover contraceptives due to the religious beliefs of their owners.

President Barack Obama's healthcare reform law requires companies to provide free birth control coverage as a preventive service included in their health plans.

The US Department of Health and Human Services had already provided an exception to non-profit groups with religious affiliations, such as certain universities or hospitals, in 2013. The exception requires insurers to cover the cost of birth control for employees of such organisations, separate from the benefits paid for by the employers.

On Friday, it was expected to propose an extension of that rule to closely-held companies in rules published in the Federal Register, the source said.

The rule is in direct response to the Supreme Court ruling in favour of Hobby Lobby Stores Ltd, a family-owned chain of craft stores, and Conestoga Wood Specialties Corp of Pennsylvania. The two companies combined employ nearly 14,000 people. The accommodation is expected to impact at nearly 50 additional companies who have filed similar lawsuits.

At the time, the justices ruled that for-profit companies can make claims under a 1993 federal law called the Religious Freedom Restoration Act that was enacted to protect religious liberty. They had suggested that the government could extend the accommodation made for non-profit groups.

HHS also proposed on Friday an interim rule for non-profits to lay out additional ways that these companies can provide notice to the government in writing of their religious objections to providing contraception coverage.

The interim rule for non-profits is largely in response to a Supreme Court order in July, issued days after the Hobby Lobby ruling, that gave a temporary exemption to a Christian college in Illinois. It had said that the initial process for informing insurers of their religious standing also violated their beliefs.