On March 2, Cardinal Timothy Dolan, president of the U.S. Conference of Catholic Bishops, released a letter suggesting that the negotiations between the White House and the USCCB over the conteception mandate had stalled because of the administration's intransigence -- especially on the issues of self-funded health plans and the definition of "religious employer" in the HHS regulations.
A few days later, an administration source shot back, claiming that the White House had put nearly everything on the table for negotiation "only to be rebuffed" by the USCCB.On March 14, the Administrative Committee of the U.S. Conference of Catholic Bishops released a statement repeating their opposition to the contraception-coverage mandate -- and laced with tendentious claims. Committee members again complained that the "now-finalized rule of the U.S. Department of Health and Human Services...would force virtually all private health plans nationwide to provide coverage of sterilization and contraception -- including abortifacient drugs -- subject to an exemption for 'religious employers' that is arbitrarily narrow, and to an unspecified and dubious future 'accommodation' for other religious organizations that are denied the exemption." (For more on how the chairman of the USCCB Ad Hoc Committee on Religious Freedom used to think about one of those morning-after pills, click here.)
Two days later, on March 16, HHS released an "Advance Notice of Proposed Rulemaking" -- stay caffeinated if you're going to try to read the whole thing; the regulatory patois is brutal. The document addresses most of the bishops' concerns, and requests public comment on some of the thornier regulatory problems. (Read Commonweal's editorial on the bishops' statement and the HHS document here.) From the beginning, the bishops have criticized the method HHS used to determine which religious employers would be exempt from providing contraception coverage to employees. You'll recall that the original ruling fully exempts only religious employers that are nonprofits, that employ and serve primarily co-religionists, and whose primary purpose is the inculcation of religious values. Obviously that doesn't cover certain Catholic ministries, such as hospitals and colleges. The Administrative Committee's letter darkly warns that the HHS definition of religious employer "will spread throughout federal law, weakening its healthy tradition of generous respect for religious freedom and diversity."
Not according to the HHS document:
The Departments emphasize that this religious exemption is intended solely for purposes of the contraceptive coverage requirement pursuant to section 2713 of the PHS Act and the companion provisions of ERISA and the Code. Whether an employer is designated as religious for these purposes is not intended as a judgment about the mission, sincerity, or commitment of the employer, and the use of such designation is limited to defining the class that qualifies for this specific exemption. The designation will not be applied with respect to any other provision of the PHS Act, ERISA, or the Code, nor is it intended to set a precedent for any other purpose.
What about the way the exemption definition will function once it goes into full effect in August 2013? Last month the USCCB put out a press release that claimed some Catholic parishes would not be exempt: "Some churches may have service to the broader community as a major focus, for example, by providing direct service to the poor regardless of faith. Such churches would be denied an exemption precisely because their service to the common good is so great." Of course that was a stretch, but given the complex relationship of Catholic institutions to their host dioceses, how will the administration determine which organizations are exempt? Back to the March 16 HHS document:
In addition, we note that this exemption is available to religious employers in a variety of arrangements. For example, a Catholic elementary school may be a distinct common-law employer from the Catholic diocese with which it is affiliated. If the schools employees receive health coverage through a plan established or maintained by the school, and the school meets the definition of a religious employer in the final regulations, then the religious employer exemption applies. If, instead, the same school provides health coverage for its employees through the same plan under which the diocese provides coverage for its employees, and the diocese is exempt from the requirement to cover contraceptive services, then neither the diocese nor the school is required to offer contraceptive coverage to its employees.
In other words, even though the Obama administration seems unwilling to budge on the rule's definition of "religious employer," the full exemption may cover more organizations than some of the mandate's critics initially thought. Employees of those institutions will not have access to free contraception coverage provided separately by insurers, as the accommodation proposes for religious hospitals, colleges, and charities.
Another major point of contention has been how self-funded health plans will fit into the HHS exemption structure. When an institution funds its own health plans, it doesn't pay premiums to an insurance company. It pays an insurance company a fee to administer the plan. If, say, Cigna is contracted to handle the plan, employees get an insurance card from the company. When employees receive medical services, Cigna forwards the bills to the employer, which in turn reimburses the insurer according to an agreed-upon price structure. When states began requiring insurance companies to cover contraception with their prescription drug benefits, religious institutions could avoid providing such coverage by self-funding their health plans -- because self-funded health plans are subject to federal, not state, regulation. That won't be an option once the HHS mandate kicks in, which is why the accommodation is a good idea.
But even if the bishops were to agree that the accommodation allows Catholic institutions to avoid illicit remote material cooperation with evil, because insurance companies would be responsible for providing separate contraception coverage to employees, when it comes to self-funded plans, almost all the money that pays for medical care comes from the employer. The cooperation would be significantly less remote.
The HHS document proposes several byzantine arrangements all designed to shift the provision of contraception coverage from self-insured religious groups to third parties, from the insurance companies that administer those plans to the government itself. The document does not finalize any of those arrangements, but requests public comment on those ideas and others for a period of ninety days. And in a separate document,HHS issued a final rule that fully exempts self-funded student plans from the contraception mandate.The bishops won't get the Taco Bell exemption. But the administration has shown that it's serious about working through the religious-liberty issues identified by the bishops. This is not necessarily a political win for Obama -- Democrats are raising money on the issue. But it's the right thing to do. Maybe someone at the USCCB will notice.