Seventh Circuit Denies Injunctive Relief To Notre Dame In ACA Contraceptive Mandate Challenge

The University of Notre Dame could not show it would suffer irreparable harm were it not granted injunctive relief pending its ongoing challenge to the Patient Protection and Affordable Care Act;s (ACA) contraceptive mandate provisions—or more precisely, the ACA regulation that requires the Catholic university to submit a form in order to avail itself of the religious exemption from the mandate. Therefore, a divided Seventh Circuit panel affirmed a lower court’s refusal to grant a preliminary injunction in the case. At least for now, the Seventh Circuit held, Notre Dame failed to show the regulations worked a substantial burden on its religious faith. The case is University of Notre Dame v. Sebelius (No. 13-3853).

The federal government has provided an exemption to churches and religious institutions from the ACA’s requirement that contraceptive services be covered. As the Seventh Circuit majority observed, Notre Dame’s claim was novel: it was not suing to secure an exemption, to which it already was entitled; rather, it sought “the right to have it without having to ask for it.” Thus far, there have been 19 cases challenging the application of the contraceptive mandate to religious nonprofits, and every plaintiff besides Notre Dame has received an injunction (though mostly in a district court).

“What makes this case and others like it involving the contraception exemption paradoxical and virtually unprecedented is that the beneficiaries of the religious exemption are claiming that the exemption process itself imposes a substantial burden on their religious faiths,” Judge Posner wrote for the majority. Yet “[t]he process of claiming one’s exemption from the duty to provide contraceptive coverage is the opposite of cumbersome. It amounts to signing one’s name and mailing the signed form to two addresses.”

Opt-out requirement. Notre Dame provides health benefits to its employees (and students). It self-insures employees’ medical expenses but utilizes the services of a third-party administrator (TPA) to administer coverage for some 4,600 employees and 6,400 dependents. Because Catholic doctrine forbids the use of contraceptives, Notre Dame has never paid for contraceptives for its employees, and it previously challenged the ACA’s mandate that it do so. However, a few months after the ACA was enacted, the government crafted the religious exemption. Narrowly drafted at first, Catholic institutions like Notre Dame, which are incorporated as nonprofits rather than religious institutions, were initially excluded. But new regulations issued in July 2013 enlarged the exemption, and Notre Dame now came within its scope.

To exercise its right to opt out of contraceptive coverage, though, the university must complete an “EBSA Form 700” certification. The short form essentially requires the institution to certify that, “on account of religious objections, the organization opposes providing coverage for some or all of any contraceptive services that would otherwise be required to be covered; the organization is organized and operates as a nonprofit entity; and the organization holds itself out as a religious organization.”

The institution must then provide a copy of the certification to its TPA in order to be accommodated with respect to the contraceptive coverage requirement. That step alerts TPAs (or health insurers) that they will have to pay for contraceptive coverage, given the religious entity’s objection. Notre Dame has signed the form and sent copies to its TPA, complying under duress. But it claims that by requiring the university to fill out the form and give copies to the TPAs, the federal government has substantially burdened its exercise of religion.

“But the university has not yet shown that there is a substantial burden. The form is two pages long—737 words, most of it boring boilerplate,” the court said, noting too that the only passages of consequence here consist of a mere 95 words. “Signing the form and mailing it … could have taken no more than five minutes. The university claims that there are other paperwork requirements; there aren’t.”

“Trigger” argument fails. “The only colorable burden it complains about has nothing to do with time or cost; it is that by filling out the form and sending it to the companies, it ‘triggers’ their coverage of the contraception costs of the university’s female employees and students, and that this makes the university an accomplice in the provision of contraception, in violation of Catholic doctrine.” Essentially, Notre Dame saw the regulation and its opt-out requirement as making the mailing of the certification form to the TPA the cause of the provision of contraceptive services to its employees, in violation of its religious beliefs. “Not so,” the majority ruled.

It is federal law—not the religious organization’s signing and mailing the form—that requires insurers (or, in this case, a TPA) to cover contraceptive services, the Seventh Circuit explained. By refusing to fill out the form, Notre Dame would be subjected to penalties, but the TPA would still be required by law to provide the contraceptive services to the university’s employees, at least until their contract with Notre Dame terminated. “The sole ‘enabler’ is the federal statute that Notre Dame has been allowed to opt out of.”

What injunctive relief? Puzzling to the court, moreover, was precisely what form of injunctive relief Notre Dame was hoping to procure, since “the university hasn’t told us what exactly it wants enjoined at this stage in the litigation.” The majority theorized that the university wanted an order barring the TPA from providing contraceptive coverage to its staff pending a final judgment on the merits. But the TPA was not named as a defendant, so it “can’t be ordered … to do anything,” the court noted. “Furthermore, while a religious institution has a broad immunity from being required to engage in acts that violate the tenets of its faith, it has no right to prevent other institutions, whether the government or a health insurance company, from engaging in acts that merely offend the institution.”

“As we cannot figure out what Notre Dame wants in the way of preliminary relief, we cannot make a determination that it will suffer irreparable harm if we affirm the denial of such relief.”

Dissent. Judge Flaum dissented, arguing that Notre Dame made out a credible claim under the Religious Freedom Restoration Act that the ACA and its regulations are a substantial burden on the university’s exercise of religion. Flaum would have granted Notre Dame a preliminary injunction forbidding the government from penalizing the university for refusing to comply with the certification requirement.

“I do not question that the accommodation is the government’s good-faith attempt to meet religious objectors halfway,” Flaum wrote. “Nevertheless, by putting substantial pressure on Notre Dame to act in ways that (as the university sees it) involve the university in the provision of contraceptives, I believe that the accommodation still runs afoul of RFRA.”

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