Free Exercise of Religion by Closely Held
Corporations: Implications of Burwell v.
Hobby Lobby Stores, Inc.
Cynthia Brougher
Legislative Attorney
July 23, 2014
Congressional Research Service
7-5700
www.crs.gov
R43654
Implications of Burwell v. Hobby Lobby Stores, Inc.
Summary
A 5-4 decision, issued over a highly critical dissent, Burwell v. Hobby Lobby Stores, Inc. resolved
one of the many challenges raised in response to the contraceptive coverage requirement of the
Affordable Care Act (ACA). Imputing the beliefs of owners of closely held corporations to such
corporations, the U.S. Supreme Court found that closely held corporations that hold religious
objections to certain contraceptive services cannot be required to provide coverage of those
services in employee health plans. The Court’s decision was based on the protections offered
under the federal Religious Freedom Restoration Act (RFRA), a statute prohibiting the
government from imposing a substantial burden on a person’s religious exercise unless it can
show a compelling interest achieved by the least restrictive means. The Court declined to address
the constitutional challenge, holding that the companies were protected under RFRA.
In the absence of a definition under RFRA, the majority interpreted the term “person” to include
closely held corporations, even if they operated for-profit, and determined that the penalties that
such companies would face if they failed to comply with the contraceptive coverage requirement
would impose a substantial burden. Though the Court assumed that the government had a
compelling interest to require contraceptive coverage under ACA, it found that less restrictive
means (e.g., expanding the regulatory accommodation available to nonprofit employers with
similar objections) could achieve that interest without requiring companies with religious
objections to be subject to the requirement.
Although Hobby Lobby resolved the question regarding the applicability of RFRA to closely held
corporations—defined by the Court as “each owned and controlled by members of a single
family”—the decision leaves open a number of questions about the scope of RFRA’s protections
and future enforcement of the contraceptive coverage requirement. Because the Court’s decision
was based on statutory grounds, Congress remains free to define which entities may be governed
by ACA or other federal laws generally.
This report analyzes the Court’s decision in Hobby Lobby, including arguments made between the
majority and dissent, to clarify the scope of the decision and potential impacts for future
interpretation of RFRA’s applicability. It also examines potential legislative responses, should
Congress consider addressing the current applicability of RFRA. Finally, the report addresses the
decision’s effect on requirements that employers offer contraceptive coverage in group health
plans under federal or state law.
Congressional Research Service
Implications of Burwell v. Hobby Lobby Stores, Inc.
Contents
Rights of Closely Held Corporations Under the Religious Freedom Restoration Act ..................... 1
Threshold Issues: Defining Person and Exercise of Religion ................................................... 2
Prohibition on Substantial Burden ............................................................................................. 4
Compelling Interest ................................................................................................................... 5
Least Restrictive Means ............................................................................................................ 5
Selected Potential Legislative Responses Following Hobby Lobby ................................................ 6
Amending RFRA to Clarify the Scope of Applicability ............................................................ 6
Preempting RFRA ..................................................................................................................... 7
Effect on Contraceptive Coverage Requirements ............................................................................ 8
Current Protection for Religious Nonprofit Organizations ........................................................ 8
State Coverage Requirements .................................................................................................. 10
Contacts
Author Contact Information........................................................................................................... 10
Congressional Research Service
Implications of Burwell v. Hobby Lobby Stores, Inc.
ne of the ongoing controversies related to the Affordable Care Act (ACA) has been the
scope of exemption from certain health care coverage requirements, including the
Ocontraceptive coverage requirement.1 Though closely divided, the U.S. Supreme Court’s
5-4 decision in Burwell v. Hobby Lobby Stores, Inc. has settled the question of whether certain
for-profit corporations must be exempt from the requirement, unless Congress chooses to amend
the statute providing those corporations legal protection.2 Imputing the beliefs of owners of
closely held corporations to the corporations themselves, the Court found that the ACA could not
require such companies to provide contraceptive coverage in group health plans offered to their
employees. It based its decision on the Religious Freedom Restoration Act (RFRA) which
provides heightened protection for burdens on religious exercise.3 Although the case has been
analogized to Citizens United v. Federal Election Commission, a 2010 case holding that
corporations have free speech rights under the First Amendment, the Hobby Lobby decision was
not decided on constitutional grounds.4 Instead, it provides protection on a statutory basis,
meaning that Congress has the ability to respond to the decision if it disagrees with the Court’s
ruling.
This report analyzes the Court’s opinions in Hobby Lobby, examining the rights of closely held
corporations under the Religious Freedom Restoration Act. It also addresses the implications for
the contraceptive coverage mandate under ACA and discusses potential legislative responses to
the Court’s decision. Finally, it analyzes the impact that Hobby Lobby may have in other contexts
in which employers may claim religious objections.
Rights of Closely Held Corporations Under the
Religious Freedom Restoration Act
The companies challenging the contraceptive coverage requirement alleged violation of their
religious exercise rights under both the First Amendment’s Free Exercise Clause and RFRA. The
Free Exercise Clause prohibits the government from prohibiting the free exercise of religion.5
Traditionally it had been interpreted to require that the government show a compelling interest for
any government action that interfered with a person’s exercise of religious beliefs.6 However, in
1990, the Supreme Court reinterpreted that standard, explaining that the Free Exercise Clause
never “relieve[s] an individual of the obligation to comply with a valid and neutral law of general
applicability.”7 The Court’s decision lowered the baseline of protection, but emphasized that
Congress remained free to consider whether additional protection would be appropriate through
the legislative process.8 Congress responded to the Court’s decision by enacting RFRA, which
essentially reinstated the heightened standard of protection.
1 Patient Protection and Affordable Care Act, P.L. 111-148, § 1001(5), 111th Cong., 2nd Sess. (2010).
2 Burwell v. Hobby Lobby Stores, Inc., Nos. 13-354 and 13-356, 2014 U.S. LEXIS 4505 (U.S. 2014).
3 P.L. 103-141, codified at 42 U.S.C. § 2000bb et seq.
4 128 S.Ct. 1471 (2008).
5 U.S. Const. amend. I.
6 See Sherbert v. Verner, 374 U.S. 398 (1963); Wisconsin v. Yoder, 406 U.S. 205 (1972).
7 Employment Division, Department of Human Resources of Oregon v. Smith, 494 U.S. 872, 879 (1990) (internal
quotes omitted).
8 Id. at 890.
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Implications of Burwell v. Hobby Lobby Stores, Inc.
RFRA states that the “[g]overnment shall not substantially burden a person’s exercise of religion
even if the burden results from a rule of general applicability, except as provided in subsection
(b).”9 Subsection (b) requires that any substantial burden must further a compelling governmental
interest and use the least restrictive means to achieve that interest.10
Threshold Issues: Defining Person and Exercise of Religion
RFRA’s language indicates that in order to raise a claim under the statute, “a person’s exercise of
religion” must be affected. However, when enacting RFRA, Congress never defined the term
person for purposes of the act. Only if a court determines that the party challenging the
government’s action is “a person” under the terms of the statute and that the party exercises
religion, can the court address the merits of the case—whether an improper substantial burden has
been placed on that party.
One of the most significant points of the Hobby Lobby decision was its declaration that closely
held corporations are “persons” eligible for protection under RFRA. The Court noted the absence
of a statutory definition of person under RFRA and consequently relied upon the Dictionary Act
to ascertain the default meaning of the term.11 The Dictionary Act defines person to “include
corporations, companies, associations, firms, partnerships, societies, and joint stock companies,
as well as individuals.”12
Rejecting the assertion that businesses organized as corporations are divested of RFRA’s
protections, the majority wrote that “[t]he plain terms of RFRA make it perfectly clear that
Congress did not discriminate [with regard to the business structure chosen by owners] who wish
to run their businesses as for-profit corporation in the manner required by their religious
beliefs.”13 The Court reasoned that RFRA was enacted to provide broad protection for religious
liberty and, without a specifically applicable definition provided in RFRA, explained that the
definition of person was not limited by for-profit status:
No known understanding of the term ‘person’ includes some but not all corporations. The
term “person” sometimes encompasses artificial persons..., and it sometimes is limited to
natural persons. But no conceivable definition of the term includes natural persons and
nonprofit corporations, but not for-profit corporations.14
The majority acknowledged that the threshold issue arguably is conditioned on the person’s
ability to exercise religion, a point emphasized by the dissent.15 However, the majority cited
previous cases in which the Court had recognized claims involving exercise of religion of
9 42 U.S.C. § 2000bb-1.
10 42 U.S.C. § 2000bb-1(b).
11 Hobby Lobby, 2014 U.S. LEXIS 4505 at *40-*42.
12 See 1 U.S.C. § 1.
13 Hobby Lobby, 2014 U.S. LEXIS 4505 at *13.
14 Id. at *38-*42.
15 Id. at *118 (Ginsburg, J., dissenting) (“Until this litigation, no decision of this Court recognized a for-profit
corporation’s qualification for a religious exemption from a generally applicable law, whether under the Free Exercise
Clause or RFRA. The absence of such precedent is just what one would expect, for the exercise of religion is
characteristic of natural persons, not artificial legal entities.”)
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individuals who owned for-profit businesses as sole proprietorships16 and nonprofit
corporations.17 Despite the dissent’s argument that religious corporations could be distinguished
from for-profit corporations because they “foster the interests of persons subscribing to the same
religious faith,” the majority held that the Court’s precedent indicated that neither for-profit status
nor corporate status are prohibitive factors in analysis of an organization’s rights under RFRA.18
Notably, when responding to concerns that applying RFRA to for-profit corporations would raise
challenges of ascertaining “the religious identity of large, publicly traded corporations,” the
majority emphasized that its decision applied only to such companies as the ones challenging the
contraceptive coverage requirement in this case. In effect, the decision therefore is limited to
“closely held corporations, each owned and controlled by members of a single family.”19
Additionally, the majority alluded to the general requirement inherent to religious exercise cases
that the parties must base their challenge on sincerely held religious beliefs, meaning that even if
RFRA would apply to a particular entity, if the entity is asserting a religious belief for the
convenience of avoiding compliance with an unpopular mandate, it could not claim legal
protection.20 The sincerity of the companies’ beliefs in Hobby Lobby was not disputed.
Although the majority noted that it was recognizing RFRA’s applicability to closely held
corporations only, it did not foreclose the possibility that in a future case, a court may extend
RFRA protection to other types of corporations such as those which are publicly traded. Instead it
suggested only that “it seems unlikely” that such “corporate giants” would assert RFRA rights
and that “numerous practical restraints would likely prevent that from occurring.”21 The dissent
was highly critical of this point, characterizing the decision as one of “startling breadth:”22
The Court’s determination that RFRA extends to for-profit corporations is bound to have
untoward effects. Although the Court attempts to cabin its language to closely held
corporations, its logic extends to corporations of any size, public or private.23
Indeed the dissent’s argument that the decision may provide a basis for expanding the protection
of RFRA further in the future may reasonably give pause. As noted, the majority did not preclude
future application of RFRA to a broader range of corporations, using tentative language and
noting a lack of obvious challenges. Furthermore, the majority’s explanation that the Dictionary
Act’s definition of person could not be read to distinguish between types of corporations related
to the company’s profit status suggests that it also may not be read to distinguish between types of
corporations on other grounds (e.g., size or public trading status).
16 See Braunfeld v. Brown, 366 U.S. 599 (1961).
17 See Corp. of Presiding Bishop of Church of Jesus Christ of Latter-Day Saints v. Amos, 483 U.S. 327 (1987); Church
of the Lukumi Babalu Aye, Inc. v. Hialeah, 508 U.S. 520 (1993); Gonzales v. o Centro Espirita Beneficiente Uniao do
Vegetal, 546 U.S. 418 (2006); Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, 132 S.Ct. 694
(2012).
18 Hobby Lobby, 2014 U.S. LEXIS 4505 at *43-*44.
19 Id. at *58.
20 Id.
21 Id.
22 Id. at *97.
23 Id. at *128.
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Prohibition on Substantial Burden
After determining that RFRA’s protections would apply, the Court examined the merits of the
RFRA claim, first identifying the burden that compliance with the contraceptive coverage
mandate would impose on the companies challenging the mandate. According to the Court,
requiring the owners of the companies to arrange for “health insurance that covers methods of
birth control that ... may result in the destruction of an embryo” means that the “mandate
demands that they engage in conduct that seriously violates their religious beliefs.”24
If the owners were to refuse to comply with the demand, the companies would face penalties
under the ACA that the Court characterized as “surely substantial.”25 If the companies continued
to provide their preferred health coverage without including the mandated contraceptive
coverage, they would face penalties each day of noncompliance, ranging from $40,000 per day to
$1.3 million per day.26 If the companies stopped providing any insurance coverage to avoid
covering contraceptives and avoid the consequent daily penalties, they would risk paying a
different penalty under ACA, which could range from $800,000 per year to $26 million per
year.27
The majority recognized the substantial burden arising from the owners’ religious objections and
potential financial penalties over strong objection from the dissenting Justices. Justice Ginsburg,
who authored the principal dissent, criticized the majority’s assessment as equating a sincere
religious objection with a substantial burden, instead of distinguishing between the two.28 In other
words, simply because a government mandate conflicts with a person’s religious belief, the
mandate is not necessarily a substantial burden. The dissent explained that the relationship
between the belief and the burden must be linked in order to identify the requisite substantial
burden:
[T]he connection between the families’ religious objections and the contraceptive coverage
requirement is too attenuated to rank as substantial. The requirement carries no command
that Hobby Lobby or Conestoga purchase or provide the contraceptives they find
objectionable. ... Importantly, the decisions whether to claim benefits under the plans are
made not by Hobby Lobby or Conestoga, but by the covered employees and dependents, in
consultation with their health care providers. ... Any decision to use contraceptives made by
a woman covered under Hobby Lobby’s or Conestoga’s plan will not be propelled by the
Government, it will be the woman’s autonomous choice, informed by the physician she
consults.29
The dissent emphasized that the “linkage” between the burden imposed by the government’s
mandate and the religious beliefs offended by the mandate would be “interrupted by independent
24 Id. at *63.
25 Id. at *64.
26 Id. at *63-*64 (“If the companies continue to offer group health plans that do not cover the contraceptives at issue,
they will be taxed $100 per day for each affected individual.”).
27 Id. at *64. Under ACA, if companies stop providing “insurance coverage altogether and thus forc[e] their employees
to obtain health insurance on one of the exchanges established under ACA” and one or more full-time employees “were
to qualify for a subsidy on one of the government-run exchanges, ... [t]he companies could face penalties of $2,000 per
employee each year.” Id.
28 Id. at *133-*134.
29 Id. at *134-*135.
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decisionmakers (the woman and her health counselor)” in a manner that would undermine
characterization of the burden imposed by the government as “substantial.”30
Compelling Interest
The Court’s analysis of the government’s interest in requiring contraceptive coverage appeared
skeptical, but ultimately it assumed that the interests were sufficiently compelling.31 The majority
noted that the government’s justifications—public health and gender equality—were too broadly
defined, explaining that RFRA requires a “‘more focused’ inquiry.”32 It cited a 2006 case in which
the Court held that, under RFRA, the government must demonstrate a compelling interest for
prohibiting an exemption for a religious purpose while allowing exemptions for other purposes.33
The majority’s discussion suggested that the stated interests were undermined by the extent of
other businesses that were exempt from offering their employees coverage (e.g., grandfathered
plans, employers with fewer than 50 employees).34
Though the Court noted its concern regarding the sufficiency of the government’s asserted
interest, it conceded the compelling interest prong of the RFRA analysis with little discussion.
However, the dissent addressed the compelling interest in greater detail, responding to the
majority’s concern about other exemptions undermining the government’s alleged interest by
citing a number of other federal laws that include exemptions for small employers without
undermining the statutory interests.35
Least Restrictive Means
The Court rejected HHS’s argument that it lacked other means to ensure availability of
contraceptive coverage without burdening these companies’ religious exercise, noting a few
alternatives it considered “less restrictive.”36 First, the majority suggested that “[t]he most
straightforward way ... would be for the Government to assume the cost of providing” coverage to
women whose employers object to providing coverage.37 Second, the Court highlighted the
availability of the accommodation already established for nonprofit employers with religious
objections, which would “protect the asserted needs of women as effectively” as the contraceptive
coverage requirement without “requiring employers to fund contraceptive methods that violate
their religious beliefs.”38 Though the Court cited the accommodation as one potential less
restrictive alternative, it explicitly noted that it was not determining its sufficiency under RFRA
for the purpose of any other legal challenge.39 Discussed in further detail later in this report, the
accommodation currently is available to certain nonprofit religious organizations who self-certify
30 Id. at *135.
31 Id. at *76-*77.
32 Id. at *74 (quoting O Centro, 546 U.S. at 430-31).
33 Id. at *74-*75.
34 Id. at *76.
35 Id. at *139-*141.
36 Id. at *77-82.
37 Id. at *77.
38 Id. at *82-*83.
39 Id. at *83.
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their objection to qualify as eligible to have the insurance issuer provide coverage to the
employees outside of the employer’s group health plan.
In response to these alternatives, the dissent questioned the extent to which the majority would
allow employers with religious objections to government mandates to avoid compliance:
And where is the stopping point to the “let the government pay” alternative? Suppose an
employer’s sincerely held religious belief is offended by health coverage of vaccines, or
paying the minimum wage, or according women equal pay for substantially similar work?
Does it rank as a less restrictive alternative to require the government to provide the money
or benefit to which the employer has a religion-based objection?40
According to the majority, the dissent’s concern with the potential assumption of costs by the
government for private objections to various legal requirements was unfounded because its
decision reached only to the contraceptive coverage requirement.41 It explained that its decision
should not be interpreted to mean that insurance coverage mandates generally cannot be upheld if
they conflict with an employer’s religious beliefs.42 The majority stated that “[o]ther coverage
requirements, such as immunizations, may be supported by different interests ... and may involve
different arguments about the least restrictive means of providing them.”43
Selected Potential Legislative Responses Following
Hobby Lobby
A number of potential legislative responses have been mentioned since the Court announced its
decision in Hobby Lobby. It is important to remember that the Court’s decision was based on the
statutory protections in RFRA, not in constitutional protections of the First Amendment. Just as
Congress may enact heightened protections for religious exercise as it did in RFRA and as it may
determine the scope of protection available, it may enact statutory language to clarify the effect of
RFRA regardless of the Court’s decision. The Court essentially created a working definition of
person under RFRA, but Congress may confirm or alter that definition at its discretion.
Alternatively, it may consider preempting RFRA with respect to certain legislative requirements.
Amending RFRA to Clarify the Scope of Applicability
The most direct congressional response to Hobby Lobby would be to amend RFRA to include a
definition of person and in effect clarify the scope of RFRA’s applicability generally. This
legislative option creates a number of possibilities, ranging from a definition of person to include
only natural persons at one end to a definition that includes all natural and artificial persons at the
other end, similar to the definition provided under the Dictionary Act used by the Court.
40 Id. at *144-*145 (internal citations omitted).
41 Id. at *86.
42 Id. at *86-*87.
43 Id. at *87.
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Implications of Burwell v. Hobby Lobby Stores, Inc.
Aside from these two extreme ends of the spectrum, Congress may consider a number of
intermediate definitions. The working definition resulting from the Court’s decision in Hobby
Lobby has been considered as one type of compromise between eliminating protection for any
corporations and extending protection for all corporations. Although not necessary in light of the
decision, Congress may choose to adopt explicitly the Court’s definition to avoid any future cases
from expanding or restricting the status quo following Hobby Lobby.
Alternatively, Congress may consider other examples when considering the scope of “persons” to
which it wants RFRA to apply. The preeminent example of Congress’s provision of protection for
potential religious objectors from a generally applicable mandate is Title VII of the Civil Rights
Act of 1964. Title VII, in part, prohibits employers from discriminating against employees on the
basis of their religious beliefs.44 Because this provision may interfere with religious employers’
religious practices (e.g., hiring employees of the same faith of the organization), Congress
included an exemption for religious entities, stating that the prohibition against religious
discrimination does not apply to “a religious corporation, association, educational institution, or
society with respect to the employment of individuals of a particular religion....”45 This provision
explicitly applies only to religious organizations, and courts generally have interpreted the scope
of the provision to take into account (1) the purpose or mission of the organization; (2) the
ownership, affiliation, or financial support of the organization; (3) requirements placed upon staff
and members of the organization; and (4) the extent of religious practices in or the religious
nature of the products and services offered by the organization and whether it operates for a
profit.46 A definition of person that would include language similar to Title VII likely would cover
religious nonprofit organizations (e.g., charities, hospitals, schools), but would not cover
commercial entities like Hobby Lobby.47
Preempting RFRA
Another option that may be used in response to Hobby Lobby would be to consider preempting
RFRA in federal legislation. Under the legal principle of entrenchment, a legislative action in one
Congress cannot bind a future Congress. That is, Congress cannot entrench a legislative action by
providing that it may not be repealed or altered.48 Accordingly, Congress may decide to enact
legislation that would make RFRA not applicable to certain federal actions. For example, if
Congress determined that it did not want to extend heightened protection that is otherwise
provided under RFRA in certain instances (e.g., the contraceptive coverage mandate), it could
enact a provision in the relevant legislation indicating that RFRA would not apply. Unlike the
previous potential legislative response, this approach would mean that Congress considers
RFRA’s applicability to each present and future law on a case-by-case basis.
44 42 U.S.C. § 2000e-2. See also 42 U.S.C. § 2000e(j).
45 42 U.S.C. § 2000e-1(a).
46 See, e.g., LeBoon v. Lancaster County Jewish Community Center Association, 503 F.3d 217, 226-27 (3rd Cir. 2007)
(providing summary discussion of the circuit courts’ interpretations of which organizations qualify for exemption under
Title VII).
47 See Equal Employment Opportunity Commission v. Townley Engineering & Manufacturing Co., 859 F.2d 610 (9th
Cir. 1988).
48 See Fletcher v. Peck, 10 U.S. 87, 135 (Chief Justice Marshall) (“The principle asserted is, that one legislature is
competent to repeal any act which a former legislature was competent to pass; and that one legislature cannot abridge
the powers of a succeeding legislature.”). The Supreme Court has noted the long history of this rule. See United States
v. Winstar Corp., 518 U.S. 839, 872-74 (1996).
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Implications of Burwell v. Hobby Lobby Stores, Inc.
Shortly after Hobby Lobby was announced, the House and Senate introduced legislation that used
this approach.49 The Protect Women’s Health From Corporate Interference Act of 2014 prohibited
employers from denying coverage of any health care services required to be covered under
federal law or regulation.50 However, to prevent employers from claiming exemption under
RFRA, the bill stated that the prohibition “shall apply notwithstanding any other provision of
Federal law, including [RFRA].”51 Accordingly, to the extent that a party may be covered by
RFRA as a general matter, such parties would not be protected from coverage requirements
imposed by federal law or regulation if the bill were enacted.
Effect on Contraceptive Coverage Requirements
Hobby Lobby expanded protection under RFRA to closely held corporations and held that such
companies could not be required to include contraceptive coverage in their group health plans to
the extent that they objected to contraceptives based on their religious beliefs. The Court did not
decide the legal issues related to the religious exemption and accommodation available for
churches and religious organizations, nor did it address protection from state requirements. As a
result, a number of legal questions remain with regard to the obligations of employers to provide
contraceptive coverage.
Current Protection for Religious Nonprofit Organizations
Since ACA’s enactment, HHS has developed various iterations of administrative regulations to
address religious objections to ACA’s contraceptive coverage requirement and promulgated final
rules in July 2013.52 These rules respond to religious entities’ objections to contraceptive
coverage in two ways: (1) an exemption for religious employers covered under subsections (a)(1),
(a)(3)(A)(i), or (a)(3)(A)(iii) of Section 6033 of the tax code and (2) an accommodation for other
eligible organizations.53
Entities covered by the relevant provisions for the exemption generally include churches, church
auxiliaries, church associations, or other religious orders.54 Under the exemption, employees of
religious employers would not receive contraceptive coverage either from their employer or from
the issuer directly.
Employers that are not covered by the exemption may instead seek protection through the
accommodation. To qualify for the accommodation, an organization must (1) object to coverage
of at least some of the contraceptive services based on religious beliefs; (2) be a nonprofit entity;
(3) hold itself out as a religious organization; and (4) comply with the self-certification
requirements of the rule.55 Under the accommodation, employees of eligible organizations would
49 H.R. 5051/S. 2578, 113th Cong. (2014).
50 Id. at § 4(a).
51 Id. at § 4(b).
52 See CRS Report WSLG689, History and Current Status for Enforcement of ACA’s Contraceptive Coverage
Requirement.
53 Coverage of Certain Preventive Health Services Under the Affordable Care Act, 78 Fed. Reg. 39,870 (July 2, 2013).
54 See 26 U.S.C. § 6033(a)(3)(A)(i), (iii).
55 See 45 C.F.R. § 147.131(b).
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not receive contraceptive coverage from their employer, but would have coverage provided
directly through the health plan issuer at no cost to the employee or the employer.
These regulations remain in effect and were not at issue in Hobby Lobby. Thus, churches and
religious nonprofit organizations may still avoid penalties for noncompliance. However, some of
the organizations that would qualify for protection under the regulations have challenged the
contraceptive coverage mandate separately, claiming that the certification process for the
accommodation burdens their religious exercise.56 These cases are not directly related to the
decision in Hobby Lobby, though the Court’s opinion has been cited by some to suggest that the
accommodation would be upheld if such a case reached the Court. 57
Notably, three days after the Hobby Lobby decision was announced, the Court issued an
injunction effectively preventing enforcement of the contraceptive coverage requirement against
Wheaton College pending a final decision in its case if the school provided written notice to HHS
of its qualifications for the accommodation.58 Providing such a letter would allow the school to
claim eligibility without using the official form—to which they object—prescribed by the
regulations. Although the order explicitly emphasized that it was not “an expression of the
Court’s views on the merits” of the case, three Justices wrote in dissent from the Court’s order.59
The dissenting Justices stated that the college’s assertion “that its filing of a self-certification form
will make it complicit in the provision of contraceptives by triggering the obligation for someone
else to provide the services to which it objects” was not a viable claim under RFRA and therefore
not eligible for injunctive relief.60 The dissenters noted that the Hobby Lobby decision considered
the accommodation to be “‘an alternative that achieves all of the Government’s aims while
providing greater respect for religious liberty.’”61 Despite the widespread attention being paid to
the Wheaton order, it indeed does not provide any final decision on the merits of the challenge to
the accommodation. Additionally, though the majority in Hobby Lobby noted the possibility that
the accommodation could be a “less restrictive” means to achieve the government’s interest in the
contraceptive coverage mandate, it did not determine it to be the least restrictive means.62 In other
words, simply because the Court pointed to the accommodation as an option that burdened the
companies’ religious exercise less does not mean that there may not be a third option that
minimized the burden even more effectively.
56 See Wheaton College v. Burwell, No. 13A1284 (U.S. July 3, 2014); Little Sisters of the Poor v. Sebelius, No.
13A691 (U.S. Jan. 24, 2014).
57 Jess Bravin, Administration Points to Hobby Lobby Ruling in Wheaton College Case, WALL STREET JOURNAL (July
2, 2014) (noting that U.S. Solicitor General Donald Verrilli argued that the Court’s decision in Hobby Lobby indicated
that the accommodation was not improper under RFRA).
58 Wheaton College v. Burwell, No. 13A1284 (U.S. July 3, 2014).
59 Id. at 2.
60 Id. at 3.
61 Id. (“After expressly relying on the availability of the religious-nonprofit accommodation to hold that the
contraceptive coverage requirement violates RFRA as applied to closely held for-profit corporations, the Court now, as
the dissent in Hobby Lobby feared it might, retreats from that position.” (citations omitted)).
62 See Hobby Lobby, 2014 U.S. LEXIS 4505 at *82 (“We do not decide today whether an approach [of the
accommodation] complies with RFRA for purposes of all religious claims.”).
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State Coverage Requirements
Hobby Lobby involved a challenge to the federal contraceptive coverage requirement by
companies seeking protection under the federal RFRA. Thus, the decision to expand protection
under RFRA to closely held corporations affects only federal law. A number of states have
enacted separate contraceptive coverage requirements, predating the ACA.63 Therefore, the
closely held companies that now have been recognized as covered by RFRA may still be
obligated to provide contraceptive coverage under state legal requirements if the states do not
have an applicable exemption to such coverage requirements.
Such companies may seek protection under state versions of RFRA, as the federal RFRA only
applies to protect against burdens imposed by federal actions. Many states enacted laws which
may be modeled on the federal RFRA to prohibit state governments from substantially burdening
religious exercise. The applicability of these state RFRAs to various types of organizations would
depend on each state’s legislative language. If the state RFRA did not define the entities which
may claim protection, a court may look to Hobby Lobby as guidance in interpreting the proper
scope, but would not be bound to reach the same conclusion as the Court did.
Author Contact Information
Cynthia Brougher
Legislative Attorney
cbrougher@crs.loc.gov, 7-9121
63 See State Policies in Brief: Insurance Coverage of Contraceptives, Guttmacher Institute (July 2, 2014), available at
http://www.guttmacher.org/statecenter/spibs/spib_ICC.pdf.
Congressional Research Service
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