United States District Court, D. Massachusetts
MEMORANDUM & ORDER
Nathaniel M. Gorton United States District Judge
case involves a dispute about the validity of two Interim
Final Rules (“IFRs”) issued by the United States
Department of Health and Human Services, the United States
Department of the Treasury and the United States Department
of Labor (collectively “defendants” or “the
Departments”) on October 6, 2017. The IFRs expand the
religious exemption to the contraceptive mandate of the
Affordable Care Act (“ACA”) and create a new
moral exemption to that mandate.
Commonwealth of Massachusetts (“plaintiff” or
“the Commonwealth”) alleges that 1) the
Departments did not engage in notice and comment rulemaking
before issuing the IFRs in violation of the Administrative
Procedure Act (“APA”), 5 U.S.C. § 553, 2)
the IFRs are not in accordance with law and exceed the
defendants authority in violation of the APA, 5 U.S.C. §
706, 3) the IFRs violate the Establishment Clause of the
First Amendment of the United States Constitution and 4) the
IFRs violate the equal protection guarantee of the Due
Process Clause of the Fifth Amendment of the United States
Constitution. The Commonwealth requests that this Court
declare the IFRs unlawful and permanently enjoin their
implementation on a nationwide, universal basis.
before the Court are plaintiff's motion for summary
judgment and defendants' cross-motion to dismiss or for
summary judgment. Because the Commonwealth has failed to set
forth specific facts establishing that it will likely suffer
future injury from the defendants' conduct, it lacks
standing to prosecute this action and defendants' motion
for summary judgment will therefore be allowed and
plaintiff's motion for summary judgment will be denied.
The contraceptive mandate
Patient Protection and Affordable Care Act generally requires
that employer-sponsored healthcare plans include a range of
preventive care services on a no-cost basis (“the
preventive services requirement”). See 42
U.S.C. §§ 18022 & 300gg-13. That requirement
mandates no-cost coverage
with respect to women, . . . as provided for in comprehensive
guidelines supported by the Health Resources and Services
S. Amdt. 2791, 111th Congress (2009-2010).
instead of including specific preventive care services,
Congress delegated authority to HRSA, an agency within the
Department of Health and Human Services (“HHS”).
HRSA and HHS enlisted the Institute of Medicine
(“IOM”), which convened a committee to assess
what preventive services should be included.
recommended that the services include
the full range of Food and Drug Administration-approved
contraceptive methods, sterilization procedures, and patient
education and counseling for women with reproductive
IOM Report at 104.
when the HRSA promulgated its Women's Preventive Services
Guidelines in August 2011, non-exempt employers were required
coverage, without cost sharing, [for] [a]ll Food and Drug
Administration-approved contraceptive methods, sterilization
procedures, and patient education and counseling (“the
contraceptive mandate”). Those guidelines went into
effect in August, 2012. The HRSA updated the Women's
Preventive Services Guidelines in December 2016, reaffirming
that the Guidelines should continue to require full coverage
for contraceptive care and services.
Accommodations for religious objections to the contraceptive
and 2012, the Departments issued regulations automatically
exempting churches and their integrated auxiliaries,
conventions and associations of churches and the exclusively
religious activities of religious orders from the
contraceptive mandate. This “Church Exemption”
corresponds to a category of employers defined in the
Internal Revenue Code. See 77 Fed. Reg. 8725, 8726
(citing 26 U.S.C. §§ 6033(a)(3)(A)(i) and (iii)).
The Departments recognized that “certain non-exempted,
non-profit organizations” also had religious objections
to covering contraceptive services but determined that
exempting such employers was not required by RFRA and was
inconsistent with the ACA. 77 Fed. Reg. 8725, 8728. Internal
church decisions, the Departments explained in later
regulations, are afforded a “particular sphere of
autonomy” that does not extend to other religious
employers. 80 Fed. Reg. 41, 318, 41, 325.
2013, the Departments issued regulations providing an
accommodation for objecting religious, non-profit
organizations and institutions of higher education. The
accommodation created a system whereby insurers and third
parties paid the full cost of contraceptive care and
employees received seamless coverage (“the
accommodation process”). That process was expanded to
cover closely held, for-profit companies in response to
Burwell v. Hobby Lobby Stores, Inc., 134 S.Ct. 2751
(2014), in which the Supreme Court held that the
contraceptive mandate violated the Religious Freedom
Restoration Act (“RFRA”) for certain
closely-held, for-profit employers. The Court held that the
“HHS contraceptive mandate substantially burden[ed] the
exercise of religion.” Id. at 2775 (internal
quotation omitted) (citing 42 U.S.C. § 2000bb-1(a)). The
accommodation process, the Court explained, was a “less
restrictive means” of furthering the government
interest and thus RFRA required that the accommodation be
expanded to include certain closely held corporations.
Id. at 2780-82.
separate series of cases, religious organizations such as
universities and healthcare providers that did not perform
“exclusively religious activities” challenged the
legality of the accommodation process itself. See Zubik
v. Burwell, 136 S.Ct. 1557 (2016). In May, 2016, those
cases were remanded to their respective circuit courts for
further consideration of whether the accommodation process
could be altered to address the religious employers'
concerns while still providing seamless contraceptive
coverage. In January, 2017, after reviewing more than 50, 000
comments, the Departments announced that the answer was
“No”. No alternative, the Departments explained,
would pose a lesser burden on religious exercise while
ensuring contraceptive coverage.
The Interim Final Rules
4, 2017, the President issued an “Executive Order
Promoting Free Speech and Religious Liberty.” Exec.
Order No. 13, 798, 92 Fed. Reg. 21, 674 (May 4, 2017). That
order instructed agencies
[to] consider issuing amended regulations, consistent with
applicable law, to address conscience-based objections to the
preventive-care mandate promulgated under section
Departments of the Treasury, Labor and HHS issued the two
Interim Final Rules (“IFRs”) at issue in this
case on October 6, 2017. See 82 Fed. Reg. 47, 799
(“Religious Exemption Rule”); 82 Fed. Reg. 47,
838 (“Moral Exemption Rule”).
IFRs create an expanded religious exemption. The HRSA exempts
objecting entities “from any guidelines'
requirements that relate to the provision of contraceptive
services.” 45 C.F.R. § 147.132(a). The Religious
Exemption Rule expands objecting entities to include any
non-governmental plan sponsor that objects to
establishing, maintaining, providing, offering, or arranging
(as applicable) coverage, payments, or a plan that provides
coverage or payments for some or all contraceptive services,
based on its sincerely held religious beliefs.
45 C.F.R. § 147.132(a)(2).
religious exemption also applies to institutions of higher
education in their arrangement of student health insurance
coverage to the extent of that institution's sincerely
held religious beliefs. 45 C.F.R. § 147.132(a)(ii). It
exempts all employers with a religious objection, as opposed
to the prior Church Exemption covering churches, associations
of churches and the exclusively religious activities of
religious orders. It also affects religious non-profit
organizations in that objecting organizations formerly
subject to the accommodation process may now seek the
the preceding Administration, no moral exemption to the
contraceptive mandate existed in any form. The Moral
Exemption Rule provides an exemption for nonprofit
organizations and for-profit entities with no publicly traded
ownership interests that object to
establishing, maintaining, providing, offering, or arranging
(as applicable) coverage or payments for some or all
contraceptive services, or for a plan, issuer, or third party
administrator that provides or arranges such coverage or
payments, based on its sincerely held moral convictions.
45 C.F.R. § 147.133(a)(2).
Estimated Impact of the IFRs
Departments provided two estimates for the number of women
who will likely be affected by the IFRs nationwide. The
first, lower, estimate is derived largely from the
Departments' experience litigating the contraceptive
mandate, the Church Exemption and the accommodation.
Departments begin their estimate by excluding certain
categories of employers as unlikely to avail themselves of
the expanded exemptions. The Religious IFR estimates that,
for certain categories of employers, no women of child
bearing age that use contraception and had access to no-cost
contraceptive care through their employer before the
Religious IFR was put into effect would lose coverage because
of the employer's availment of the Religious IFR.
Although these employers would be transitioning from the
accommodation to the exemption, the Departments estimated
that the Religious IFR would have no effect on those
employers' employees. That is because
the Departments continue to assume that such plans are
similar to other objecting entities using self-insured church
plans with respect to their third party administrators being
unlikely to provide contraceptive coverage to plan
participants and beneficiaries under the previous rule.
82 Fed. Reg. 47792, 47816.
Departments excluded certain categories of employers from
their estimates because the Departments deemed those
employers unlikely to avail themselves of the exemption. For
instance, the Departments state that
although publicly traded entities could make use of exempt
status under these interim final rules, the Departments do
not expect that very many will do so.
82 Fed. Reg. 47792, 47816; see also 82 Fed. Reg.
47792, 47816 (“No publicly traded for-profit entities
have filed lawsuits challenging the mandate.”).
Departments estimate that 209 entities will make use of the
expanded religious exemption nationwide. This number was
originally put forth in August 2014 and July 2015 as
HHS's estimate of how many entities would avail
themselves of the accommodation process. See 82 Fed.
Reg. 47792, 47817. The figure was based on
122 eligible entities that had filed litigation challenging
the accommodation process, and 87 closely held for-profit
entities that had filed suit challenging the Mandate in
Id. (citing 79 Fed. Reg. 51096; 80 Fed. Reg. 41336).
the Departments estimate that of the 209 previously
accommodated litigating entities, 109 “will make use of
their exempt status, and 100 will continue using the
accommodation.” See id. In addition, the
Departments assume that nine entities newly eligible for the
accommodation “will use the voluntary accommodation
moving forward.” See id.
that some of the previously accommodated litigating entities
will continue using the accommodation while others will use
the exemption, the Departments estimate that
109 entities will use the voluntary accommodation moving
forward, 100 of which were already using the previous
accommodation, and that 109 entities that have been using the