Supreme Court: Government can’t make closely held companies cover contraceptives

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

(CNN) -- The Supreme Court ruled Monday that closely held companies cannot be required to pay to cover some types of contraceptives for their employees, ending its term with a narrow legal and political setback for a controversial part of President Barack Obama's healthcare reform law.

The owners of Hobby Lobby, furniture maker Conestoga Wood Specialties and Christian bookseller Mardel argued that the Affordable Care Act violates the First Amendment and other federal laws protecting religious freedom because it requires them to provide coverage for contraceptives like the "morning-after pill," which the companies consider tantamount to abortion.

The decision, which comes two years after the justices narrowly preserved the Affordable Care Act and its key funding provision, could serve as a primer for other pending challenges to the health law.

The issue before the justices was whether Obamacare can mandate contraception coverage specifically for certain businesses that object for religious reasons.

"This case isn't that practically important, except for the employees and businesses involved. There just aren't a huge number of those," said Thomas Goldstein, publisher of and a Washington appellate attorney.

"But everyone can agree the social questions presented -- about when people can follow their religious convictions, and when people are entitled to contraception care -- are truly important," he said.

Contraception mandate

The section of law in dispute requires for-profit employers of a certain size to offer insurance benefits for birth control and other reproductive health services without a co-pay.

A number of companies equate some of the covered drugs, such as the so-called "morning-after" pill, as causing abortion.

The specific question presented was whether these companies can refuse, on the sincere claim it would violate their owners' long-established moral beliefs.

The First Amendment says that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof."

"How does a corporation exercise religion?" asked Justice Sonia Sotomayor at March's oral arguments, summarizing perhaps the key constitutional question at hand.

"This is a religious question and it's a moral question," added Justice Samuel Alito, suggesting the businesses have such a right. "You want us to provide a definitive secular answer."

Conestoga, Hobby Lobby

The justices have a good deal of discretion to frame the competing issues and could reach a limited "compromise" through narrow statutory interpretation.

They could conclude individual owners can make the religious freedom claim, bypassing the corporate rights argument, but still give female workers the flexibility to get covered drugs.

The court weighed two related appeals from Conestoga Wood Specialties, a Pennsylvania cabinet maker, and Hobby Lobby, an Oklahoma-based retail giant that will have more than 700 arts-and-crafts stores nationwide by year's end.

Both corporations emphasized their desire to operate in harmony with biblical principles while competing in a secular marketplace. That includes their leaders' publicly stated opposition to abortion.

The case presented a complex mix of legal, regulatory, and constitutional concerns over such thorny issues as faith, abortion, corporate power, executive agency discretion, and congressional intent.

Health law impact

The political stakes are large, especially for the future effectiveness of the health law, which marks its fourth anniversary this year.

The botched rollout last fall of, the federal Obamacare website, has become another political flashpoint along with other issues that many Republicans say proves the law is unworkable.

They have made Obamacare a key campaign issue in their fight to overtake the Senate, and retain control of the House.

Supporters of the law fear a high court setback on the contraception mandate will lead to other healthcare challenges on religion grounds, such as do-not-resuscitate orders and vaccine coverage. More broadly, many worry giving corporations religious freedom rights could affect laws on employment, safety, and civil rights.

The abortion link

The Hahn family, owners of Conestoga, and the Green family, owners of Hobby Lobby, said some of the mandated contraception prevent human embryos from being implanted in a woman's womb, which the plaintiffs equate with abortion.

That includes Plan B contraception, which some have called the "morning after" pill, and intrauterine devices or IUDs used by an estimated 2 million American women.

A key issue for the bench was interpreting a 1993 federal law requiring the government to seek the "least burdensome" and narrowly tailored means for any law that interferes with religious convictions.

Monday's decision comes two years after the justices allowed the law's "individual mandate" to go into effect.

That provision requires most Americans to get health insurance or pay a financial penalty. It is seen as the key funding mechanism to ensure near-universal health coverage.

Under the Affordable Care Act, financial penalties of up to $100 per day, per employee can be levied on firms that refuse to provide comprehensive health coverage. Hobby Lobby, which has about 13,000 workers, estimates the penalty could cost it $475 million a year.

The church-state issue now in the spotlight involves rules negotiated between the Obama administration and various outside groups. Under the changes, churches and houses of worship are completely exempt from the contraception mandate.

Other nonprofit, religiously affiliated groups, such as church-run hospitals, parochial schools and charities must either offer coverage or have a third-party insurer provide separate benefits without the employer's direct involvement. Lawsuits in those cases are pending in several federal appeals courts.

Second generation

Monday's decision could signal how the court will approach other lawsuits against the health care law.

"We're now getting the second generation of challenges to Obamacare-- about the actual adoption of the statute, and its core provisions," said Goldstein. "We're probably going to see cases over the next five to ten years, as more and more details about the law get put into effect."


  • Say What

    This story is inaccurate. WHNT is disappointing concerning this story! The Court said that only “closely held” companies, not corporations, are exempt. There is a big difference between the two!

    • Nuclear Mike

      Agreed…only “closely-held” corporations retain the personality & political views of their owners, therefore, this is a just decision. Having built 3 small companies I fully agree with the Court.

      • Say What

        Mike, this is a rare occurrence — we both agree. Since this decision is so narrow, employees can find other employment if they disagree with Hobby Lobby. If the decision would have been broad they would be trapped in all kinds of religious craziness!

    • Nuclear Mike

      …and your comment illustrates the quality of the written reports offered by WHNT as a reflection of their editing staff’s education and discipline in average at best reporting skills.

  • Patrick

    How the heck is this a rare occurrence?? As a small business owner (corporation) that has 1 person with 100% of the stock, I would think that there are tons more like me than corporation like Target and Apple (public companies) which are owned by thousands.

    • Say What

      Patrick, businesses with fewer than 50 employees are already exempt for the Affordable Care Act.

  • Sissy McCloud

    The insurance should cover birth control regardless .. It should be a woman’s right to decide if she wants birth control or not .. This is more about Women Rights than the bible…. get over it everyone has different beliefs .. The Insurance should cover birth control …

    • Branko Pezdi

      I’ve looked and looked and see no “Women Rights” in the Constitution. Can you help me out and point out where exactly this phrase appears in the document?

      • Say What

        Blanko, it comes from the same place that said that the 2nd Amendment applies to individuals and not militias — a US Supreme Court decision!

  • tim

    Good decision , however 4 of the liberal supreme idiots dissented. If one more liberal supreme idiot gets on the court more unconstitutional laws will be passed and they will let them stand. You do not have a “right” to birth control it is a personal choice like buying a phone , car or cable. Do I have a right to a phone, car and cable ? No…. and taxpayers shouldn’t have to fund it nor should my employer. The liberal judges have made it pretty clear they will take your religious freedom , along with any other freedom of choosing if they become the majority.

  • Scallywagandvagabond (@ScallywagNYC)

    What’s next, what other procedures will a corporation deem not accommodating its religious/moral belief system?Will corporation in the future look to deny hiring employees whose actions, beliefs, don’t match a corporate’s ‘religious beliefs? What about those women who need to take contraceptives to control other medical symptoms ? Why in fact put healthcare policy in the control of employers in the first place, given their incentive to purely make money?

    Going further, if the reality of a for profit corporation is to make money how can it even be held to have a religious agenda? Isn’t this really a cue to stick the buck to the consumer and to reinforce the negation of women’s rights and needs?

Comments are closed.