Contraceptive Coverage Rules Will Apply to Self-Insured Employers, Sebelius Says

February 16, 2012 — HHS Secretary Kathleen Sebelius on Wednesday said that federal contraceptive coverage requirements will apply to self-insured employers, as well as policies issued by insurance companies, Modern Healthcare reports (Daly, Modern Healthcare, 2/15). HHS will address the issue in a final rule by August 2013 to implement its decision last week to revise a religious exemption to the contraceptive coverage requirements (Ethridge, CQ Today, 2/15).

"Yes, I think that we will apply it to both," Sebelius told reporters after a Senate Finance Committee hearing on President Obama's proposed budget. "Whether it's an insured plan or self-insured plan, that the employer who has a religious objection doesn't have to directly offer or pay for contraception," she added (Winfield Cunningham, Washington Times, 2/15).

Employers that self-insure provide health insurance directly to their workers and pay the health care claims themselves, the New York Times reports. Many large religiously affiliated employers, such as hospitals and universities, self-insure. According to the Kaiser Family Foundation, 60% of employees with health insurance were covered through a self-insured employer in 2011. Industry experts and Catholic groups said they do not know how many religiously affiliated employers self-insure but that the number likely is similar to the nationwide figure.

The Obama administration did not address the issue of self-insured employers when it announced changes to the religious exemption on Friday (Thomas, New York Times, 2/15). In that announcement, it said religiously affiliated employers will not have to offer contraceptive coverage for their employees, but their insurers will be required to provide the coverage directly to women at no charge (Women's Health Policy Report, 2/15).

The announcement prompted questions about how the administration would seek to reconcile the issue of employers that self-insure and also oppose contraception. In some states that require employers to provide contraceptive coverage, religiously affiliated employers have opted to self-insure to avoid the requirement, Michael Galligan-Stierle, president of the Association of Catholic Colleges and Universities, said (New York Times, 2/15).

Sebelius Says She Did Not Consult Bishops on Contraceptive Rule

At the Senate Finance Committee hearing, Sen. Orrin Hatch (R-Utah) asked Sebelius whether she had consulted with the Catholic bishops before Friday's announcement on the changes to the religious exemption (Baker, "Healthwatch," The Hill, 2/15).

"I did not speak with the Catholic bishops," Sebelius responded, adding that Obama "has spoken to the bishops on several occasions." Hatch then asked whether the Obama administration or campaign officials spoke with groups that support abortion rights. "I assume some of those groups were talked to," Sebelius said, adding that she did not know for certain.

Hatch also pressed Sebelius for a response to a letter from himself and other senators questioning whether HHS conducted an analysis on the legality of the contraceptive coverage rules. Sebelius said she would "respond as rapidly as [she] possibly can" (Feder, Politico, 2/15).

Senate Expected To Vote on Blunt Proposal Next Week

Meanwhile, according to a Democratic aide, the Senate next week will vote on an amendment that would permit employers to deny health insurance coverage of any service for moral reasons (Sargent, "The Plum Line," Washington Post, 2/15).

Sen. Roy Blunt (R-Mo.) had sought to attach the amendment to a transportation bill, but Senate Majority Leader Harry Reid (D-Nev.) on Wednesday used a procedural move to block amendments to the bill. Democrats have said Republicans are trying to delay the bill, in part by adding unrelated amendments (Snider, Politico, 2/15).

Debate Has Political Implications for Both Sides

Ahead of the November election, supporters and opponents of the contraceptive coverage rules are mobilizing aggressive campaigns to lobby Congress and shape public opinion, the New York Times reports. While the Catholic bishops and conservative evangelical groups have framed the issue as a fight over "religious liberty," women's groups say the debate is about women's health and access to contraception (Eckholm, New York Times, 2/15).

According to the Los Angeles Times, although many conservative Republican leaders also have decried the federal rules as an attack on religious freedom, several states have enacted contraceptive coverage requirements with the support of GOP lawmakers and governors. Of 22 states with laws or regulations that resemble the federal rules, more than one-third received some Republican support, according to state records (Geiger/Levey, Los Angeles Times, 2/15).

Meanwhile, a group of Catholic and university leaders on Wednesday expressed support for the rules and criticized Republicans who have accused Obama of waging a "war on religion," CQ HealthBeat reports (Norman, CQ HealthBeat, 2/15).

The group's comments came as another Catholic group, Priests for Life filed a lawsuit in federal court in Brooklyn against the rules (Wetzstein, Washington Times, 2/15). Priests for Life claims the requirement violates its religious and free-speech rights (Weidlich, Bloomberg/Businessweek, 2/16).

HHS Touts Improved Access to Preventive Care

In related news, HHS released a pair of reports finding that in 2011, the federal health reform law helped more than 86 million U.S. residents gain access to a range of preventive care services, such as mammograms and Pap tests, The Hill's "Healthwatch" reports (Pecquet, "Healthwatch," The Hill, 2/15).

The overhaul requires Medicare and new health plans to provide preventive care services at no additional cost to consumers (National Journal, 2/15). According to one report, female Medicare beneficiaries received six millions mammograms, 2.8 million bone mass measurements and 1.2 million Pap tests (Pecquet, "Healthwatch," The Hill, 2/15).