HHS Guidance on Contraceptives Establishes Temporary Safe Harbor for Religious Organizations | Practical Law

HHS Guidance on Contraceptives Establishes Temporary Safe Harbor for Religious Organizations | Practical Law

The Department of Health and Human Services (HHS) issued guidance that provides a temporary enforcement safe harbor under which group health plans sponsored by certain religious-affiliated employers will have an additional year to comply with an Affordable Care Act (ACA) provision requiring first-dollar coverage for contraceptives for women.

HHS Guidance on Contraceptives Establishes Temporary Safe Harbor for Religious Organizations

by PLC Employee Benefits & Executive Compensation
Published on 14 Feb 2012 • USA (National/Federal)
The Department of Health and Human Services (HHS) issued guidance that provides a temporary enforcement safe harbor under which group health plans sponsored by certain religious-affiliated employers will have an additional year to comply with an Affordable Care Act (ACA) provision requiring first-dollar coverage for contraceptives for women.
On February 10, 2012, HHS issued guidance that provides a temporary enforcement safe harbor under which group health plans sponsored by certain religious-affiliated employers will have an additional year to comply with an Affordable Care Act (ACA) provision requiring first-dollar coverage for contraceptives for women. The contraceptives requirement is part of a broader ACA provision requiring coverage of certain preventive services without cost sharing. The enforcement safe harbor was discussed in the preamble to regulations that finalize, without change, August 2011 interim final regulations authorizing an exemption from the contraceptives requirement for certain religious employers that were issued by the Departments of Labor, Treasury and Health & Human Services (the Departments). For a discussion of the August 2011 regulations, see Legal Update, New Guidelines Require Health Plans to Cover Women's Preventive Care Free of Charge.
The August 2011 regulations, as finalized, exempt churches, other houses of worship and similar organizations from covering contraception on the basis of their religious objections. The temporary enforcement safe harbor, in contrast, applies to a larger set of religiously-affiliated organizations (for example, religiously-affiliated educational institutions and charities).

Temporary Enforcement Safe Harbor for Religiously-affiliated Organizations

The HHS guidance sets out several requirements for plans wishing to take advantage of the temporary enforcement safe harbor. This transitional relief will be in effect until the first plan year that begins on or after August 1, 2013. The safe harbor is generally available to group health plans that are not:
  • Exempt under the August 2011 interim final regulations, as finalized, for churches and other houses of worship.
  • Grandfathered plans under the ACA. The rules regarding coverage of preventive health services do not apply to grandfathered health plans under the ACA (for more information, see Practice Note, Grandfathered Health Plans under the ACA).
In addition to these threshold requirements, the plan must be established or maintained by an organization that meets the following requirements:
  • The organization must be organized and operate as a non-profit entity.
  • From February 10, 2012, onward, contraceptive coverage must not have been provided at any time by the plan, consistent with state law, due to the organization's religious beliefs.
  • The plan must provide participants a notice, provided in the HHS guidance, stating that contraceptive coverage will not be provided under the plan for the first plan year beginning on or after August 1, 2012. The notice can be provided on the plan's behalf by an insurer or third-party administrator.
  • The organization must:
    • self-certify that the above requirements are met; and
    • document this self-certification.
Employers, plans and insurers that satisfy these requirements will not be subject to enforcement action by the Departments for failing to cover contraceptive services without cost sharing.
The guidance includes a certification form, which must be:
  • Signed by a representative of the organization authorized to make the certification on the organization's behalf.
  • Completed and made available for examination by the first day of the plan year to which the safe harbor applies.
A two-sentence notice, also included in the guidance, must be provided in any enrollment (or re-enrollment) materials distributed for coverage that is effective beginning on the first day of the first plan year on or after August 1, 2012.

Additional Guidance Would Require Insurers to Cover Contraception

In a related fact sheet, the White House indicated that additional guidance will be issued prior to the end of the enforcement safe harbor. The guidance would require contraception coverage to be offered directly to women by insurers of religious employers that oppose contraception.

Practical Implications

Employers wanting to take advantage of the transitional relief for religiously-affiliated employers should carefully review the HHS one-year enforcement safe harbor, which includes numerous requirements (including the notice and self-certification rules). The contraceptives coverage provision has proven to be one of the more controversial requirements under the ACA, and, as indicated above, this HHS guidance will not be the last word on the issue.
For more information on required coverage of preventive health services, see Practice Note, Coverage of Preventive Health Services under the ACA.