WASHINGTON — Nonprofit religious groups won’t have to pay for their employees’ birth control under the 2010 health-care law, the Obama administration said Friday, attempting to quash a conflict that has triggered dozens of protests and lawsuits.
New rules the U.S. government issued require insurers who administer health coverage for religious nonprofits to cover birth control for employees of the groups without charging the nonprofit or the workers. The matter has inspired at least 44 lawsuits against the government, according to the Becket Fund for Religious Liberty, a legal group fighting the mandate.
The health law, the Patient Protection and Affordable Care Act, requires insurers and employers who provide health coverage to their workers to pay for government-recommended preventive services without co-payments. In August 2011, the Obama administration said those services would include contraception such as birth-control pills, implants and sterilization procedures.
Religious organizations opposed to birth control demanded an exception to the requirement. The Obama administration initially provided a one-year delay until this August to allow the groups to comply, while promising further compromise.
“The administration is taking the next step in providing women across the nation with coverage of recommended preventive care at no cost, while respecting religious concerns,” Health and Human Services Secretary Kathleen Sebelius said in a statement.
The rules have drawn scrutiny. About 200,000 people and organizations sent formal comments on preliminary rules outlining a compromise the administration issued in March 2012.
The government said it would broaden the types of organizations eligible for an exemption from the birth control mandate and make it easier for them to escape it. Nonprofits that object to the requirement need only lodge a protest with the health insurer that covers their workers, or the company that administers their health benefits if they are self-insured, the administration said.
The rule “would limit any accommodation to nonprofit organizations that hold themselves out as religious,” the administration said, a definition that may include church-affiliated hospitals and universities that weren’t previously exempt.
Administration officials proposed a new definition of “religious employers” who can be exempted from the requirement to provide contraceptive coverage.
The exemption would be available to churches, other houses of worship and certain affiliated organizations.
Under the proposal, the administration said, “a house of worship would not be excluded from the exemption because, for example, it provides charitable social services to persons of different religious faiths or employs persons of different religious faiths.”
The administration had previously agreed to allow exemptions for certain religious employers. But church groups said the exemption was so narrow that it was almost meaningless.
Cardinal Timothy Dolan of New York, president of the U.S. Conference of Catholic Bishops, issued a noncommittal statement saying he welcomed the opportunity to study the new proposed regulation.
Stephen Schneck, director of the Institute for Policy Research and Catholic Studies at the Catholic University of America, said the proposed changes were “an important win for religious institutions.”
Under the original standard, a religious employer could not have qualified for the exemption if it employed or served large numbers of people of a different faith, as many Catholic hospitals, universities and social service agencies do.
The administration said that the new definition, though simpler, “would not expand the universe of employer plans that would qualify for the exemption beyond that which was intended” in a final regulation issued last year.
It’s unclear how Friday’s proposal affects the lawsuits filed by nonprofits, said Kyle Duncan, general counsel for the Becket Fund.
Fourteen of the 44 lawsuits tracked by Duncan’s group were filed by for-profit companies whose owners object to covering certain types of birth control such as Teva Pharmaceutical Industries Ltd.’s “morning-after pill,” Plan B One-Step. Ten of the companies have received injunctions against the requirement. The government’s rule doesn’t relieve for-profit companies from the birth-control mandate.
“Today’s proposed rule does nothing to protect the religious liberty of millions of Americans,” Duncan said.
Groups that advocate for civil liberties and abortion rights applauded the government’s proposal.
“Over the last year, we’ve seen a disturbing number of instances where employers are trying to impose their religious beliefs on a diverse workforce that does not share them, and opponents of the law have made it clear that they won’t rest until no insurance plan, whatever the source, is required to cover contraception,” said Sarah Lipton-Lubet, policy counsel for the American Civil Liberties Union, in a statement.
The Obama administration, she said, “continues to stand with women.”
The National Association of Evangelicals, which represents about 40 denominations and works with the administration on immigration and other matters, rejected the rule. It said the change didn’t create enough of a buffer between faith groups and birth-control coverage.
“The Obama administration should have done the right thing and dropped the contraception mandate, or at least should have exempted all religious organizations,” said Leith Anderson, the association’s president.
If a nonprofit’s workers get health insurance through a plan offered by companies such as United Health Group Inc., the insurer will have to arrange coverage of birth control without any cost to the nonprofit or to workers.
“Actuaries, economists and insurers estimate that providing contraceptive coverage is at least cost neutral, and may result in cost savings when taking into account all costs and benefits for the insurer,” the government said in a regulatory filing.
For nonprofits that are self insured, birth-control coverage for their workers will be more complicated. The responsibility will fall to companies that manage benefits for the nonprofits, called third-party administrators. While many insurers including United Health act as third-party administrators, other companies that aren’t insurers also perform the service.
If there is a cost to third party administrators for the coverage, the government will reimburse them by reducing the fees their insurers pay to offer plans in new health insurance marketplaces, called exchanges, which are being established under the health law.
The government has no estimate of how much the reimbursements may cost, said Chiquita Brooks-LaSure, deputy director of policy and regulation at the Center for Consumer Information and Insurance Oversight, which administers much of the health law.
The government said almost all self-insured nonprofits employ an independent company to administer their health benefits.
Information for this article was contributed by Alex Wayne of Bloomberg News; by Robert Pear of The New York Times and by Rachel Zoll, Ricardo Alonso-Zaldivar and David Crary of The Associated Press.
Front Section, Pages 1 on 02/02/2013