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RLUIPA and the Individual Mandate Cases

Written by Daniel P. Dalton on February 12, 2013 Category: RLUIPA

One more place to look for help in understanding what a “substantial burden” is within the context of the Free Exercise Clause of the First Amendment and the Religious Freedom Restoration Act is the nearly fifty individual mandate cases presently being litigated throughout the United States.

The Patient Protection and Affordable Care Act (the ACA”) Pub. L. No. 111-148, 124 Stat. 119 (2010), requires that group health insurance plans cover certain preventable medical services without cost sharing. The coverage mandate is the result of a complex history of Congressional legislation and agency rulemaking involving the Department of Labor, Treasury and Health and Human Services. In March 2010, Congress enacted the ACA as well as the Health Care and Education Reconciliation Act. These acts established a number of requirements relating to the “group health plans,” a term which encompasses employer plans that provide health care coverage to employees, regardless of whether the plans are insured or self-insured. 42 U.S.C. Sec. 300gg-91(a)(1); 75 Fed. Reg. 41,726-727 (July 19, 2010). The Health Resources and Services Administration (HRSA) commissioned the Institute of Medicine (IOM) to develop recommendations for the HSRS guidelines. The IOM published a report which proposed, among other things, that insurance plans cover “[a]ll Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity.” See, http//www.hrsa.gov/womensguidelines/. Included among the DDA approved contraceptive methods are abortion related drugs.

HRSA adopted IOM’s recommendations on August 1, 2011. Two days later, the interim rules were adopted to exclude no-profit religious entities. 45 C.F.R. Sec. 147.130(a)(1)(iv)(B)(HHS). On February 15, 2012, the Departments finalized the rules without addressing the impact of the coverage mandate on for profit entities operated and owned by individuals with deeply held religious beliefs who oppose the requirement to pay for their employers contraceptives and abortions. The failure to comply with the Coverage Mandate may result in substantial penalties. Under the Internal Revenue Code, large employers (those who employee over 50 people) and fail to offer “full time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an eligible employer sponsored plan” can be assessed an annual fine of $2,000 per full-time employee. 26 U.S.C. Sec. 4980H(a), (c)(1). An additional tax of $100 per employee pe day may be imposed for “any failure of a group health plan” to provide required coverage. 26 U.S.C. Sec. 4980D(b); See also, 42 U.S.C. Sec. 300gg-22(b)(2)(C)(i) (providing penalties of up to $100 per person per day for failure to satisfy coverage requirements.)

Soon thereafter, a collection of lawsuits were filed challenging the mandate requirement to pay for contraceptives and abortions. At the heart of the cases is whether the requirement to pay for contraceptive and abortions is a “substantial burden” under the Free Exercise Clause of the First Amendment or the Religious Freedom Restoration Act (RFRA) 42 U.S.C. Sec. 2000bb-9(a). RFRA prohibits the government from “substantially burden[ing] a person’s exercise of religion even if the burden results from a rule of general applicability.” 42 U.S.C. Sec. 2000bb-9(a). A substantial burden is permissible under RFRA, however, if the government “demonstrates that application of the burden to the person – (1) is in furtherance of a compelling governmental interest; and (2) is the least restrictive means of furthering that compelling governmental interest.” Id., Sec. 2000bb-1(b). In other words, the Court applies strict scrutiny to federal statutes that substantially burden the free exercise of religion. Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal, 546 U.S. 418, 424 (2006). As with RLUIPA, Congress made the express choice to leave the term “substantial burden” undefined resulting in a variety of definitions for us to consider.

As of January 15, 2013, there have fourteen decisions applying RFRA and the Free Exercise Clause to substantial burden claims arising out of the mandate cases.[1] The variety of decisions has caused a significant amount of confusion within the Circuits as to what a substantial burden actually is within the context of religious beliefs. On December 20, 2012, for example, the Tenth Circuit Court of Appeals denied an injunction to one of the highest-profile plaintiffs, Hobby Lobby. The court concluded that concerns by the craft chain's owners, the evangelical philanthropist Green family, that “funds [might] subsidize someone else's participation in an activity condemned by plaintiff[s'] religion” were not a substantial burden to the Greens' religious exercise. The United States Supreme Court then refused to hear the appeal as the case is still pending below. The following week, the Seventh Circuit Court of Appeals rejected the Tenth Circuit’s decision concluding that it “misunderstands the substance of the claim.” In affirming an injunction, the Seventh Circuit held that, “The religious‐liberty violation at issue here is the coerced coverage of contraception, abortifacients, sterilization, and related services, not—or perhaps more precisely, not only—in the later purchase or use of contraception or related services.” As a result, the judges ruled 2–1 that the construction company's Catholic owners had established “a reasonable likelihood of success on their claim that the contraception mandate imposes a substantial burden on their religious exercise,” and noted “the burden will be on the government to demonstrate that the contraception mandate is the least restrictive means of furthering a compelling governmental interest.”

The United States Supreme Court may soon weigh in on the issue of defining the term “substantial burden” within the meaning of RFRA and within the context of the mandate issue. On November 26, 2012, the Supreme Court remanded Liberty University v. Geithner, 11-438 (4th Cir. 2012) back to the Fourth Circuit Court of Appeals to have it address the constitutionality of the mandate requiring employers to provide insurance that includes coverage for contraceptives and abortions under the First Amendment’s Free Exercise clause. It is anticipated that the decision will return to the Court regardless of how the Fourth Circuit rules in that case.


[1] Nine courts granted injunctive relief. See, Korte v. Sebelius, 2012 WL 6757353; Triune Health Grp., Inc. v. U.S. Dep’t of Health & Human Servs., No. 12 C 6756, slip op. at 1 (N.D.Ill. Jan. 3, 2012); Sharpe Holdings, Inc. v. U.S. Dep’t of Health & Human Servs., No. 2:12-CV-92, slip op. at 1 (E.D. Mo. Dec. 31, 2012); Monaghan v. Sebelius, No. 12-15488, 2012 WL 6738476, at *3-6 (E.D. Mich. Dec.30, 2012); Conestoga Wood Specialties Corp. v. Sebelius, No. 12-6744, slip op. at 1 (E.D. Pa. Dec. 28, 2012); Am. Pulverizer Co.v. U.S. No. 12-3459 (W.D. Mo. Dec. 20, 2012); Tyndale House Publishers, Inc. v. Sebelius, No. 12-1635, 2012 WL 5817323, at *10-18 (D.D.C. Nov. 16, 2012); Legatus v. Sebelius, No. 12-12061, 2012 WL 5359630, at *6 (E.D.Mich. Oct. 31, 2012); Newland v. Sebelius, No. 1:12-cv-1123,2012 WL 3069154, at *6-8 (D. Colo. July 27, 2012). Four courts denied injunctive relief. See Autocam Corp.v. Sebelius, Case No. 12-2673 (6th Cir., Dec. 28, 2012); Hobby Lobby Stores v. Sebelius, No. 12-6294 (10th Cir., Dec. 20, 2012); Grote Indus. v. Sebelius, No. 4:12-cv-00134, 2012 WL 6725905, at *6-7 (S.D. Ind. Dec. 27, 2012) and Annex Medical Inc. v. Sebelius, No. 12-2804 (D. Minn., 1/8/13)

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