A Federal Judge Upholds the Women’s Health Regulations of the Affordable Care Act Against a Free Exercise of Religion Challenge

Posted in: Health Law

Last week, U.S. District Judge Carol E. Jackson, in O’Brien v. HHS, upheld the regulations enforcing the Patient Protection and Affordable Care Act (ACA) that require employers to provide women’s health, or reproductive medical services, as part of their group health plans.  The challenge was brought by a secular, for-profit company, O’Brien Industrial Holdings, and its Chairman, Frank O’Brien, who is Catholic.  In a nutshell, O’Brien objects to the ACA regulation’s requirement that contraception or sterilization services be included in his employees’ healthcare plans.

The regulation at issue does exempt some organizations, to wit, non-profit organizations the purpose of which is to inculcate particular religious values; that primarily employ persons of the faith; and that serve those who share their religious tenets.  In short, it exempts churches and religious orders.  Because the O’Brien company is a for-profit mining operation that does not share any of these characteristics, the religious exemption does not apply.

Therefore, the women’s health regulations apply to the plaintiffs, and they argued that their free exercise rights (both constitutional and statutory) were violated.  They also raised Establishment Clause, Speech Clause, and Administrative Procedure Act claims.  The court rejected all of their arguments, but I will only address the free exercise claims in this column.

Why the ACA Regulation Is Constitutional Under the First Amendment’s Free Exercise Clause

Over 20 years ago, in Employment Div. v. Smith, the Supreme Court surveyed its existing free exercise cases and summarized the “vast majority” with one principle: laws that are neutral and generally applicable are subject to rationality review.

In other words, if the government is not discriminating, and it is willing to apply the same regulation to everyone who is similarly situated, then the law does not violate the constitutional guarantee of the free exercise of religion.  That is the standard that governs in this case, and, in fact, the Court was correct at the time that it was the standard that best explained its prior cases, as I discuss in this scholarly article on Smith at the Supreme Court.

The requirement that health coverage serve women’s reproductive health benefits all women, regardless of creed, and society as a whole.  This regulation was included in the ACA on the basis of a study by the non-profit, non-governmental organization Institute for Medicine, which identified these medical services as necessary to women’s health.  Thus, there is little doubt that the regulation was instituted for medical reasons, and, therefore, is neutral.

The regulation is also generally applicable as it applies to every organization, except for nonprofit organizations that hire and serve fellow believers.  O’Brien Industries could not successfully argue that it was being treated differently from similarly-situated businesses.

Accordingly, the regulation easily satisfies the requirements of the First Amendment’s Free Exercise Clause, under the prevailing standard.

O’Brien still objected to the regulation, on the ground that it disproportionately affects those who believe that the use of contraception and sterilization is evil, but the court quite rightly responded that the fact that a law has a disproportionate impact on a particular set of religious believers does not transform the law into a free exercise violation.  For instance, laws against the medical neglect of children are disproportionately burdensome to parents who do not believe in medical care, but that does not make such laws unconstitutional.  Requiring parents to obtain medical care for children in danger of death or disability is perfectly constitutional.  (Thus, the unfortunate exemptions to the medical neglect laws in some states are the result of statutory grace, not constitutional requirement.)

Similarly, alterations in the statutes of limitations for child sex abuse may disproportionately affect large religious organizations that have covered up child sex abuse, but that disproportionate impact does not make those statutes of limitations a violation of the churches’ free exercise right.

Why the ACA Regulation Is Legal Under the Religious Freedom Restoration Act, Also Known as RFRA

The district court in the O’Brien case also had to address whether the regulation violates the Religious Freedom Restoration Act (“RFRA”).  Under RFRA, a religious claimant, as a threshold matter, must prove that the law at issue imposes a “substantial burden” on religious conduct.  If it succeeds, the burden shifts to the government to prove that the law serves a compelling interest via the least restrictive means.  Judge Jackson rejected O’Brien’s RFRA theory at step one, reasoning that the law does not impose a substantial burden on O’Brien’s religious faith.

No doubt, from O’Brien’s own subjective perspective, having to pay for contraception imposes a heavy burden, but the court pointed out that the burden was too attenuated to be deemed substantial, as that term has been interpreted by the courts.  Indeed, the burden is merely “incidental,” or attenuated, along the lines of the Supreme Court’s decision in Lyng v. Northwest Cemetery Protective Association.  In that case, Native American believers objected to the federal government’s use of its lands for a road, because the road would run too close to sacred burial grounds.  The Native Americans argued that the government’s disturbance of silence and peace near their sacred grounds violated their free exercise of religion.  The Court rejected their theory, even if the government’s actions proved to have “devastating effects” on their faith.  In other words, impact, alone, is not sufficient to establish a “substantial burden.”  Moreover, due to a series of Supreme Court and lower court decisions, it is now well-settled that cost and convenience cannot support a finding of a substantial burden, and that incidental burdens arising from large, complex government programs are not the sort of burdens that free exercise rights are intended to protect.  The burden, here, though, does not rest directly on the religious believer.  It is an indirect burden at best.

Judge Jackson’s reasoning is solid.  Under the ACA, the employer is required to pay for a health care plan, and that plan must cover necessary items for women’s health, along with all of the other expected areas of health care coverage.  O’Brien does not personally believe in using contraception or sterilization, and he can tell his employees (and everyone else he meets) about his beliefs, and try to change their minds on the issue.   But this case is about conduct, not speech, and the money he contributes to the plan is fungible.  Once that money is in the plan, independent decisionmakers (that is, employees who may or may not share the employer’s faith, and their medical providers) may or may not include contraception and sterilization in their health care decisions.  But it is their choice, not the employer’s, as to whether they choose to do so.  Neither he nor anyone in his family is required to obtain reproductive health services to which he objects, and he will not even know if, in fact, the plan is ever used in that way.  Indeed, given doctor-patient confidentiality, he couldn’t find out even if he wanted to.

The court explained the point as follows:

The burden of which plaintiffs complain is that funds, which plaintiffs will contribute to a group health plan, might, after a series of independent decisions by health care providers and patients covered by [the company’s] plan, subsidize someone else’s participation in an activity that is condemned by plaintiffs’ religion.  This Court rejects the proposition that requiring indirect financial support of a practice, from which plaintiff himself abstains according to his religious principles, constitutes a substantial burden on plaintiff’s religious exercise . . . .  Under plaintiffs’ interpretation of RFRA a law substantially burdens one’s religion whenever it requires an outlay of funds that might eventually be used by a third party in a manner inconsistent with one’s religious values.  This is at most a de minimis burden on religious practice.

The Slippery Slope

Not only is the burden too attenuated to establish a substantial burden for purposes of free-exercise analysis, but if the plaintiffs in the O’Brien case were permitted to excise certain medical care to which they object from being mandatory health care under the ACA, then the list of medical treatments that secular, for-profit employers would be able to avoid subsidizing would be long indeed.  For example, Jehovah’s Witnesses do not believe in blood transfusions.  Could a secular, for-profit company owned by a Jehovah’s Witness exclude blood transfusions from all of its employees’ ACA coverage, because such transfusions are against the owner’s religious beliefs?   Or how about a company owned by a Scientologist, who chooses to exclude all mental health care according to Scientology’s tenets?   Or what if a company owned by a Catholic, or an evangelical Christian, sought to exclude all medical treatments derived from embryonic stem cell research, or all palliative care for the terminally ill?  In each of these instances, it would be inevitable that the religious company owner would be using the health care plan as a proxy for deterring and undermining the medical choices that other religious believers (or in some cases, non-believers) would make in good conscience.

Some might argue that owners should be able to operate in the marketplace and to tailor their health care benefits as idiosyncratically as they choose.  That model was eliminated years ago in the states, which have forced insurance companies to include coverage for a wide array of services in the interest of the larger public good.  Some of those mandatory services, like Pap smears, have been services for women.  Big surprise—companies did not prove to be reliable representatives of the public good either. Indeed, the need for such a provision has been illustrated by the history of health care coverage in the states.

The Big Picture

I believe that these cases go to the very heart of what makes America a world leader.  We have been able to foster extraordinary religious diversity while experiencing remarkably nonviolent coexistence.  When you look at the rest of the world today, and at history, this achievement stands out as one of the great government and social innovations for all time.  It is attributable in large part to the balance struck by the courts interpreting the First Amendment’s Religion Clauses, as well as the anti-discrimination laws, and the usual fair-mindedness of most Americans.

In the U.S., religious diversity is a value, while religious discrimination is a legal and moral hazard.  This is reflected in part in the federal and state anti-discrimination laws that forbid companies from discriminating on the basis of religious faith.  O’Brien may not legally choose who works for his mining company based on their faith.  Therefore, he cannot, through hiring and firing, craft a set of employees who reflect just his religious beliefs.  At least, that is what our legal system intends. And everyone benefits: I imagine that O’Brien would be very unhappy if someone in his family were denied a job because he or she was Catholic.

In a universe where employers may not use faith as a criterion for hiring, it is virtually certain that an employer of any substantial size will have employees who do not share the employers’ faith.  That means that the employer is paying salaries and giving benefits to a range of religious believers, and thereby indirectly contributing to a range of religious practices that he may not subscribe to, and may even find evil.  If O’Brien had a “right” to micromanage his healthcare plan to reflect his religious faith, then he would, in effect, be able to impose his faith on those with different beliefs.

Were the case to have gone the other way, the employer could accomplish through the back door what he can’t do through the front:  If healthcare were capable of being shaped by the religious beliefs of an employer, then the jobs in that company would become a better fit for co-religionists, and a worse fit for those with different beliefs.  Such a company would become a hostile benefits environment, if you will.  And that is the path to Balkanization and religious strife, of which we fortunately have had very little in the richly and deeply diverse United States.

This reasoning is consistent with the Supreme Court’s decision in United States v. Lee, in which the Court held that the free-exercise rights of Amish employers were not violated by mandatory Social Security taxes, even though the Amish believed that they had a religious obligation to care for each other in their later years.  In that case, there was a legislative exemption for an individual Amish person who sought to avoid the tax, but not for those who employed others.  That distinction and the burden on employers were upheld.  The Court observed that “we are a cosmopolitan nation made up of people of almost every conceivable religious preference . . . .  To maintain an organized society that guarantees religious freedom to a great variety of faiths requires that some religious practices yield to the common good . . . .  When followers of a particular sect enter into commercial activity as a matter of choice, the limits they accept on their own conduct as a matter of conscience and faith are not to be superimposed on the statutory schemes which are binding on others in that activity.  Granting an exemption from social security taxes to an employer operates to impose the employer’s religious faith on the employees.”

Arizona is actually toying with a law that apparently would permit employers to fire women if they use the Pill for reasons that conflict with the faith of the employer.   That is the direction in which we would be headed if the O’Brien case and others challenging the women’s health provisions of the ACA were decided in favor of the employer.   The Arizona bill is a classic example of Nietzsche’s will to power, wherein religious believers attempt to impose their beliefs on others.  In the United States, that is not religious liberty.  It is theocracy.