I:\28947 Ind Law Rev 47-1\47masthead.wpd


NO GOOD DEED:  THE IMPROPRIETY OF THE RELIGIOUS
ACCOMMODATION OF CONTRACEPTIVE COVERAGE

REQUIREMENTS IN THE PATIENT PROTECTION
AND AFFORDABLE CARE ACT

ROSE SHINGLEDECKER*

INTRODUCTION

On March 23, 2010, the 111th Congress enacted the Patient Protection and
Affordable Care Act (PPACA),1 dramatically expanding Americans’ access to
health insurance coverage.  Along with other provisions, the PPACA requires
employers with fifty or more employees to provide health insurance benefits to
their employees.2  Under the Women’s Health Amendment (WHA),3 these group
health plans must provide a minimal level of coverage, including certain
“preventive care and screenings” for women.4  The covered preventive care
services are delineated in comprehensive guidelines promulgated by the Health
Resources and Services Administration.5  These guidelines include well-woman
visits, screening for gestational diabetes, breastfeeding support and counseling,
and screening and counseling for interpersonal and domestic violence.6  

More controversially, plans must include coverage for all Food and Drug
Administration-approved contraceptive methods, sterilization procedures, and
associated counseling.7  In response to public outcry from groups that oppose
contraceptive and sterilization services for religious reasons, the Department of

* J.D. Candidate, 2014, Indiana University Robert H. McKinney School of Law; B.A.,
2004, DePauw University, Greencastle, Indiana.  My sincere thanks to the following, whose
thoughtful and insightful comments and suggestions guided this Note:  Professor Jennifer A.
Drobac, Brian Casserly, Brian Karle, and Scott Conner.

1. Pub. L. No. 111-148, 124 Stat. 119 (2010).
2. 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011).
3. 42 U.S.C. § 300gg-13(a) (Supp. 2011).  
4. Id. § 300gg-13(a)(4).  More comprehensively, regarding preventive care, § 300gg-13(a)

provides: 
“[a] group health plan and a health insurance issuer offering group or individual health
insurance coverage shall, at a minimum provide coverage for and shall not impose any
cost sharing requirements for—
(1) evidence-based items or services that have in effect a rating of “A” or “B” in the
current recommendations of the United States Preventive Services Task Force; . . . 
(4) with respect to women, such additional preventive care and screenings not described
in paragraph (1) as provided for in comprehensive guidelines supported by the Health
Resources and Services Administration for purposes of this paragraph.”
5. Id. 
6. Affordable Care Act Rules on Expanding Access to Preventive Services for Women, U.S.

DEP’T OF HEALTH & HUMAN SERV. (Aug. 1, 2011), http://www.hhs.gov/healthcare/facts/factsheets/
2011/08/womensprevention08012011a.html [hereinafter Affordable Care Act Rules].

7. Id.



302 INDIANA LAW REVIEW [Vol. 47:301

Health and Human Services (HHS) adopted a narrow religious exemption to the
contraceptive services coverage provision.8  However, numerous non-exempt
religious employers have challenged the HHS rule requiring coverage of
contraception in employer group health plans on the grounds that the regulation
violates the First Amendment and the Religious Freedom and Restoration Act by
requiring employers to violate their religious beliefs.9

This Note argues that HHS’s religious exemption was unnecessary and
misguided.  First, the broad requirement that all employers provide health
insurance benefits that include contraception services in the minimum level of
coverage does not violate the Free Exercise clause of the First Amendment or the
Religious Freedom and Restoration Act.  Second, the exemption makes the
regulation vulnerable to the very First Amendment challenges it seeks to avoid. 
As the saying goes, no good deed goes unpunished.

I.  BACKGROUND:  THE RELIGIOUS EXEMPTION, CONCEPTION TO BIRTH

A.  The Women’s Health Amendment
On December 3, 2009, the U.S. Senate passed by a 61-39 vote Senator

Barbara Mikulski’s (D-Md.) Women’s Health Amendment (WHA),10 which
expanded the PPACA’s minimum insurance coverage requirements.11  The WHA
requires an employer’s group health plan to provide a minimal level of
coverage—without any cost-sharing—for women’s preventive care and
screenings.12  The WHA does not specify which preventive care and screenings
are covered.13  Rather, it designates the Health Resources and Services
Administration (HRSA), an HHS agency, to identify the covered preventive
services.14  Senators debating the WHA expressly contemplated including
contraception and family planning among the covered services.15  However, the

8. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4) (2012).  (The language referenced in this
citation has since been amended, but it is still accessible at http://www.law.cornell.edu/cfr/text/
45/147.130.)

9. See Laurie Goodstein, Bishops Sue Over Contraception Mandate, N.Y. TIMES, May 22,
2012, at A17.

10. Press Release, Senator Barbara A. Mikulski, Senate Approves Mikulski Amendment
Making Women's Preventive Care Affordable and Accessible (Dec. 3, 2009), http://www.mikulski.
senate.gov/media/pressrelease/12-03-2009.cfm. 

11. See Chad Brooker, Comment, Making Contraception Easier to Swallow: Background and
Religious Challenges to the HHS Rule Mandating Coverage of Contraceptives, 12 U. MD. L.J.
RACE, RELIGION, GENDER & CLASS 169, 184 (2012).  

12. 42 U.S.C. § 300gg-13(a)(4) (Supp. 2011).
13. Id.
14. Id. (stating that additional preventive care and screenings are “provided for in

comprehensive guidelines supported by the Health Resources and Services Administration”).
15. Brooker, supra note 11, at 186-88.



2014] NO GOOD DEED 303

extent of the covered services remained unclear for nearly twenty months.16 

B.  The Department of Health & Human Services Rule
On July 19, 2010, HHS issued an interim final rule (IFR),17 which stated that

guidelines for required women’s preventive services would be issued by August
1, 2011.18  For input on additional preventive services for women, the HRSA
turned to the Institute of Medicine (IOM).19  IOM is an independent, nonprofit
organization founded in 1970 to advise Congress, federal agencies, and other
organizations on medical issues.20  In a July 2011 report, IOM issued
recommendations that HHS should include, among other services, the “full range
of Food and Drug Administration-approved contraceptive methods, sterilization
procedures, and patient education and counseling for women with reproductive
capacity.”21  HHS adopted IOM’s recommendations, including the contraception
recommendations, on August 1, 2011.22

C.  The Religious Exemption
When HHS adopted IOM’s recommendations, HHS also amended the IFR

to provide a narrow religious exemption to the contraception coverage
requirements.23  The amended regulations created an automatic exemption for
certain categories of employers with religious objections to contraceptive use.24 
A qualifying employer: 

(1) has the inculcation of religious values as its purpose; 
(2) primarily employs persons who share its religious tenets; 
(3) primarily serves persons who share its religious tenets; and 
(4) is a non-profit organization under section 6033(a)(1) and section

16. See infra Part I.B.
17. See Interim Final Rules for Group Health Plans and Health Insurance Issuers Relating

to Coverage of Preventive Services Under the Patient Protection and Affordable Care Act, 75 Fed.
Reg. 41,726 (July 19, 2010).  The proposed rule was issued by HHS, in conjunction with the
departments of the Treasury and Labor.  For simplicity, this Note refers to the rules as originating
from HHS.

18. Id. at 41728.
19. Affordable Care Act Rules, supra note 6.
20. About the IOM, INST. OF MED., http://www.iom.edu/About-IOM.aspx (last updated Nov.

4, 2013).
21. Recommendations for Preventive Services for Women that Should be Considered by HHS,

INST. OF MED. (July 19, 2011), http://www.iom.edu/Reports/2011/Clinical-Preventive-Services-for-
Women-Closing-the-Gaps/Recommendations.aspx.

22. Affordable Care Act Rules, supra note 6.
23. Group Health Plans and Health Insurance Issuers Relating to Coverage of Preventive

Services Under the Patient Protection and Affordable Care Act, 76 Fed. Reg. 46,621 (Aug. 3, 2011)
[hereinafter Interim Final Rules].  

24. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4) (2012).



304 INDIANA LAW REVIEW [Vol. 47:301

6033(a)(3)(A)(i) or (iii) of the Code.25

Section 6033(a)(3)(A)(i) and (iii) refer to churches, their integrated auxiliaries,
and conventions or associations of churches, as well as to the exclusively
religious activities of any religious order.26  

In adopting the religious employer definition, HHS’s stated goal was “to
reasonably balance the extension of any coverage of contraceptive services . . .
to as many women as possible, while respecting the unique relationship between
certain religious employers and their employees in certain religious positions.”27 
Moreover, HHS explicitly modeled this definition of religious employer on
existing state laws that require employer-sponsored health plans to cover
contraceptive services.28  Although the IFR fails to specify which states provided
the model, the highest courts in New York and California have upheld the
constitutionality of nearly identical exemptions to contraceptive coverage laws
in their respective states.29  Comments regarding the amendment were accepted
through September 30, 2011.30  

D.  Response & Criticism
HHS received more than 200,000 responses to the request for comments on

the interim regulations.31  The narrowness of the exemption drew criticism from
a variety of groups, particularly organizations that, although affiliated with a
church or other religious sect, would not likely be considered a religious
organization under the rule.32  One commentator speculated that “Catholic

25. Id.
26. 26 U.S.C. §§ 6033(a)(3)(A)(i), (iii) (2006); see also Interim Final Rules, supra note 23,

at 46,623.
27. Interim Final Rules, supra note 23, at 46623.
28. Id. (“The definition of religious employer, as set forth in the amended regulations, is

based on existing definitions used by most States that exempt certain religious employers from
having to comply with State law requirements to cover contraceptive services.”).

29. See Catholic Charities of the Diocese of Albany v. Serio, 7 N.Y.3d 510, 521 (2006)
(holding that the religious freedoms of plaintiffs of eight Catholic and two Baptist organizations
that did not qualify for a narrow religious exemption from a New York law requiring employers
to provide insurance coverage for contraception, were not violated); Catholic Charities of
Sacramento, Inc. v. Super. Ct., 10 Cal. Rptr. 3d 283, 290 (2004) (holding that a California law
requiring employer-sponsored health plans to cover contraceptive services did not violate the
religious freedoms of a large Catholic employer that did not qualify for a narrow religious
exemption).

30. Interim Final Rules, supra note 23, at 46,621.
31. Group Health Plans and Health Insurance Issuers Relating to Coverage of Preventive

Services Under the Patient Protection and Affordable Care Act, 77 Fed. Reg. 8725, 8726 (Feb. 15,
2012) [hereinafter Final Rule].  

32. See, e.g., Press Release, Rev. Larry Snyder, President, Catholic Charities USA (Jan. 20,
2012), http://www.scribd.com/doc/111046521/Statement-From-CCUSA-on-Health-Care-
Contraception-1-20-12 (“With the existing restrictive definition in this mandate, the ministry of



2014] NO GOOD DEED 305

hospitals, food banks, homeless shelters, most Catholic schools, and . . . Catholic
business owners” (as well as non-Catholic but similar organizations associated
with a religious group) likely would not qualify for the exemption.33  Specifically,
large religious non-profit hospitals, though religious in ownership or
management, do not qualify as “churches, their integrated auxiliaries, and
conventions or associations of churches,” thus violating section four.34

E.  The Final Rule
In February 2012, HHS adopted the IFR without change to the religious

exemption criteria, effective for all non-grandfathered plans on August 1, 2012.35 
HHS noted that it “carefully considered whether to eliminate the religious
employer exemption or to adopt an alternative definition of religious employer,”
but decided to retain the four-pronged religious employer definition from the
August 2011 ruling.36

However, despite HHS’s claims that the February regulations “finalize,
without change, [the] interim final regulations,”37 HHS simultaneously created a
temporary safe harbor for certain non-exempt employers.38  The safe harbor
extends the compliance deadline to August 1, 2013, for those non-exempted, non-
profit employers that object for religious reasons to contraceptive services but do
not meet the religious employer definition.39  During this time, HHS pledged to
“work with stakeholders to develop alternative ways of providing contraceptive
coverage without cost sharing. ”40  HSS’s expressed goals for the safe harbor
period were two-fold:  “providing contraceptive coverage without cost-sharing
to individuals who want it and accommodating non-exempted, non-profit
organizations’ religious objections to covering contraceptive services.”41  

Jesus Christ himself would not be considered a religious entity.”). 
33. Edward Whelan, The HHS Contraception Mandate vs. the Religious Freedom Restoration

Act, 87 NOTRE DAME L. REV. 2179, 2180 (2012).
34. 26 U.S.C. § 6033(a)(3)(A)(i) (2006); 45 C.F.R. § 147.130(a)(1)(iv)(B)(4) (2012).
35. Final Rule, supra note 31, at 8725.
36. Id. at 8727.
37. Id., at 8725.
38. Id. at 8727.
39. Bulletin, Dep’t Health & Human Serv., Guidance on the Temporary Enforcement Safe

Harbor for Certain Employers, Group Health Plans and Group Health Insurance Issuers with
Respect to the Requirement to Cover Contraceptive Services Without Cost Sharing Under Section
2713 of the Public Health Service Act, Section 715(a)(1) of the Employee Retirement Income
Security Act, and Section 9815(a)(1) of the Internal Revenue Code (June 28, 2013), 
http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/preventive-services-
guidance-6-28-2013.pdf.

40. Final Rule, supra note 31, at 8728.
41. Id. at 8727.



306 INDIANA LAW REVIEW [Vol. 47:301

F.  Proposed Accommodation
On March 21, 2012, HHS issued an advance notice of proposed rulemaking

(ANPRM) and requested comment until June 19, 2012.42  In the ANPRM, HHS
delineated an accommodation designed to maintain employees’ access to
contraception while protecting religious organizations “from having to contract,
arrange, or pay for contraceptive coverage.”43  The compromise permits the issuer
of a non-exempt religious employer’s insurance plan (i.e. the employer’s
insurance company) to exclude contraception from covered services.44  The issuer
would then issue directly to the employee, without additional cost, a separate plan
to cover contraceptive services.45  As the proposal explains: 

This means that contraceptive coverage would not be included in the plan
document, contract, or premium charged to the religious organization.
Instead, the issuer would be required to provide participants and
beneficiaries covered under the plan separate coverage for contraceptive
services, potentially as excepted benefits, without cost sharing, and notify
plan participants and beneficiaries of its availability. The issuer could not
charge a premium to the religious organization or plan participants or
beneficiaries for the contraceptive coverage.46

Essentially, the proposed compromise shifts the cost of contraceptive coverage
from the employer to the insurance company that issues the employer’s plan. 
HHS reasons that costs can reasonably be shifted to insurance carriers because
“[a]ctuaries and experts have found that coverage of contraceptives is at least cost
neutral, and may save money, when taking into account all costs and benefits for
the issuer.”47  Contraceptive coverage is theoretically cost-neutral for insurance
companies because the up-front cost of providing contraceptive coverage is offset
by long-term savings in the cost of covering pregnancy and birth.48  However,
financial experts dispute the cost-neutrality of contraceptive coverage.49 

G.  Response to Proposed Compromise & Current Litigation
HHS’s February 2012 rule and March 2012 proposed compromise were met

with resistance.  On May 21, 2012, forty-three Catholic organizations filed a total
of twelve lawsuits challenging the inclusion of coverage for contraception within

42. Certain Preventive Services Under the Affordable Care Act, 77 Fed. Reg. 16,501 (Mar.
21, 2012).  

43. Id. at 16,503.
44. Id. at 16,505.
45. Id.
46. Id. 
47. Id. at 16,503.
48. Id.
49. Ben Finley, Cloudy Contraception Costs, FACTCHECK.ORG (Feb. 24, 2012), http://www.

factcheck.org/2012/02/cloudy-contraception-costs/.



2014] NO GOOD DEED 307

the HHS guidelines.50  The suits contend that HHS’s rule violates the plaintiffs’
Free Speech, Free Exercise, and Establishment Clause rights under the First
Amendment, the Religious Freedom Restoration Act (RFRA), and the
Administrative Procedure Act.51  The Catholic cases joined eleven complaints
previously filed on behalf of religious organizations and employers.52  At the time
this Note was written, forty-eight cases representing more than 140 plaintiffs have
been filed,53 many supported by non-profit organizations such as The Becket
Fund for Religious Liberty and the Thomas More Law Center (a non-profit law
firm dedicated in part to defending religious freedom).54  These cases—in which
the plaintiffs include both non-profit religious organizations and for-profit
business owners whose religious beliefs do not permit the use of
contraceptives—are progressing through the federal court system with mixed
results.55  Of the twelve Catholic cases filed on May 21, 2012, courts dismissed
two cases for lack of standing because HHS announced an intention to work with
religious employers during the safe harbor period.56  In cases brought by for-
profit plaintiffs (who were not granted safe harbor and thus subject to the IFR
beginning August 1, 2012), court opinions have also diverged.57  In the Seventh
and Eighth circuits, courts have granted the for-profit employers injunctive relief
from compliance with the regulation, while courts in the Sixth and Tenth circuits
denied it.58  Most recently, the U.S. Supreme Court denied Hobby Lobby, an

50. See Goodstein, supra note 9.
51. See, e.g., Complaint & Demand for Jury Trial, Univ. of Notre Dame v. Sebelius, No.

3:12CV253, 2012 WL 1859163 (N.D. Ind. May 21, 2012) [hereinafter Notre Dame Complaint]. 
The same law firm, Jones Day, represents the plaintiffs in all twelve lawsuits filed by Catholic
entities on May 21, 2012; thus, the complaints are substantially similar in structure and content. 
See HHS Information Central, THE BECKET FUND FOR RELIGIOUS LIBERTY, http://www.becketfund.
org/hhsinformationcentral/ (last visited May 12, 2014) [hereinafter HHS Information Central].

52. HHS Information Central, supra note 51 (comprehensively mapping and tracking current
lawsuits challenging the IFR).  

53. Id.
54. Id.
55. Id.
56. Univ. of Notre Dame v. Sebelius, No. 3:12CV253RLM, 2012 WL 6756332, at *1, *4

(N.D. Ind. Dec. 31, 2012) (holding that, because “HHS announced that it would amend the
regulations before the end of the safe harbor to accommodate those entities by requiring their
insurers to provide cost-free coverage for the contraceptive and abortion-related services,” Notre
Dame lacked standing to attack the regulatory requirement); Zubik v. Sebelius, 911 F. Supp. 2d
314, 318 (W.D. Pa. 2012) (same). 

57. HHS Information Central, supra note 51.
58. Hobby Lobby Stores, Inc. v. Sebelius, 133 S. Ct. 641, 642 (2012) (“the Court of Appeals

for the Tenth Circuit denied the applicants’ motion for an injunction pending resolution of the
appeal”); Order, O’Brien v. U.S. Dep’t Health & Human Servs., No. 4:12-CV-00476-CEJ (8th Cir.
Nov. 28, 2012), available at http://c0391070.cdn2.cloudfiles.rackspacecloud.com/pdf/8th-circuit-
order-granting-temporary-injunction-in-obrien-v-hhs.pdf (granting, without opinion, plaintiff’s
motion for stay pending appeal); Korte v. Sebelius, No. 12-3841, 2012 WL 6757353, at *4-5 (7th



308 INDIANA LAW REVIEW [Vol. 47:301

Eleventh Circuit for-profit plaintiff, application for an injunction pending
appellate review.59  

H.  2013 Proposed Changes—New Definition & Accommodation
On February 6, 2013, HHS proposed two changes to the contraceptive

coverage requirement: amendment of the religious employer definition and
adoption of the cost-sharing compromise.60  First, HHS proposed to strike the first
three criteria from the religious employer exemption.61  No longer would a
religious organization need to show that it (1) has “the inculcation of religious
values as its purpose,” (2) “primarily employs persons who share the religious
tenets of the organization,” or (3) “serves primarily persons who share the
religious tenets of the organization.”62  As a result, a religious employer “that is
organized and operates as a nonprofit entity and referred to in section
6033(a)(3)(A)(i) or (iii) of the Code would be considered a religious employer for
purposes of the religious employer exemption.”63  Again, the applicable code
sections refer to “churches, their integrated auxiliaries, and conventions or
associations of churches.”64  

As HHS notes, however, the change would not “expand the universe of
employer plans that would qualify for the exemption beyond that which was
intended in the 2012 final rules.”65  Rather, HHS states that the exemption was
always intended to apply to “group health plans of houses of worship that provide
educational, charitable, or social services to their communities.”66  These
organizations, such as “a church [that] maintains a soup kitchen that provides free
meals to low-income individuals irrespective of their religious faiths,” likely
would have failed the third prong of the test (primarily serves persons who share

Cir. Dec. 28, 2012) (holding that plaintiffs, Catholic owners of a construction company,
demonstrated reasonable likelihood of success on their claims and irreparable harm such that “the
balance of harms tips strongly in the [plaintiffs’] favor” for granting an injunction pending appeal);
Order, Autocam Corp. v. Sebelius, No. 12-2673, at 2 (6th Cir. Dec. 28, 2012), available at
http://www.becketfund.org/wp-content/uploads/2012/05/order-denying-injunctionAutocam-
CA6.pdf (denying plaintiffs’ motion for injunction pending appeal because “plaintiffs have not
demonstrated more than a possibility of relief”).

59. Hobby Lobby, 133 S. Ct. at 643 (holding that plaintiffs, operators of for-profit
corporations with Christian leadership, “do not satisfy the demanding standard for the extraordinary
relief they seek”).

60. Coverage of Certain Preventive Services Under the Affordable Care Act, 78 Fed. Reg.
8456, 8456-57 (Feb. 6, 2013) [hereinafter Proposed Rules].  

61. Id. at 8461.
62. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(3) (2012).
63. Proposed Rules, supra note 60, at 8461.
64. 26 U.S.C. § 6033(a)(3)(A)(i) (2006).
65. Proposed Rules, supra note 60, at 8461.
66. Id.



2014] NO GOOD DEED 309

its religious tenets).67   Because that was not the intention, HHS proposed to strike
the first three criteria.68  As a result, organizations operated directly by a church,
such as the soup kitchen or a church-run parochial school, would be automatically
exempt.69  But large religiously-affiliated organizations, such as non-profit
Catholic hospitals, still no longer qualify under the preserved fourth prong.  The
proposed definition would still “focus the religious employer exemption on the
unique relationship between a house of worship and its employees in ministerial
positions.”70

Second, HHS officially proposed that it establish an “accommodation” for
non-exempt religious employers who object for religious reasons to contraceptive
services.71  The accommodation, first outlined in the March 2012 ANPRM,
creates an arrangement in which a non-exempt religious employer’s insurance
company offers directly to employees a separate contraceptive services plan.72 
This insulates the employer from “contracting, arranging, paying, or referring”
for contraceptive coverage.73  Although the February 2013 proposed rules give
additional detail beyond the ANPRM, the accommodation essentially operates the
same way; it shifts the cost of contraceptive coverage from the employer to the
insurance company.74

II.  THE DEBATE

A.  Contraception—Use, Benefits, and Costs
The WHA was introduced “to guarantee women access to preventive health

care screenings and care at no cost.”75   In introducing the WHA, Senator
Mikulski expressed concern about the large gender disparities in health care
services costs:

Women are often confronted by the punitive practices of insurance
companies.  We face gender discrimination.  We pay more and get less
. . . A 40-year-old woman is charged anywhere from two to 140 percent
more than a 40-year-old man with the same health status for the same
insurance policy.  A 25-year-old woman is charged up to 45 percent
more than a 25-year-old man.76

67. Id..
68. Id.
69. Id.
70. Id. (internal quotation marks and citation omitted).
71. Id.
72. Id.
73. Id. at 8462.
74. Id. at 8463.
75. Press Release, Senator Barbara A. Mikulski, Mikulski Puts Women First in Health Care

Reform Debate (Nov. 30, 2009), http://www.mikulski.senate.gov/media/pressrelease/11-30-2009-
2.cfm [hereinafter Mikulski Press Release].

76. Id.



310 INDIANA LAW REVIEW [Vol. 47:301

As HHS notes, “owing to reproductive and sex-specific conditions, women use
preventive services more than men, generating significant out-of-pocket expenses
for women.”77  The HHS rule and the WHA aim to eliminate these gender-based
cost disparities.78  

For consumers of contraception, the cost of coverage varies widely by the
type of contraception used.79  One article found that the cost of common
contraception methods varied from $60 to $600 per year.80  Another study found
that the highest potential cost of the most commonly used contraceptive methods
ranges from $200 to $1210 per year for consumers without insurance.81  The same
study estimates that costs with insurance are considerably lower and more
uniform, ranging from $100 to $215 per year.82  Partly because of contraceptive
costs, women of reproductive age spend sixty-eight percent more than men on
out-of-pocket health care costs.83 

Contraceptive use is very common among American women—ninety-eight
percent of all women who have had intercourse have used at least some form of
contraception at some time.84  In addition to common use, IOM included
contraceptives in the recommended covered services to help “reduce the rate of
unintended pregnancies.”85  Studies show that:

Women with unintended pregnancies are more likely to receive delayed
or no prenatal care and to smoke, consume alcohol, be depressed, and
experience domestic violence during pregnancy.  Unintended pregnancy
also increases the risk of babies being born preterm or at a low birth
weight, both of which raise their chances of health and developmental
problems.86

77. Final Rule, supra note 31, at 8728.
78. Id. at 8729 (“The contraceptive coverage requirement is . . . designed to serve . . . 

compelling public health and gender equity goals . . .”).
79. Kimberly Palmer, The Real Cost of Birth Control, U.S. NEWS & WORLD REP. ALPHA

CONSUMER BLOG (Mar. 5, 2012), http://money.usnews.com/money/blogs/alpha-consumer/2012/03/
05/the-real-cost-of-birth-control.

80. Id.
81. The High Costs of Birth Control, CENTER FOR AM. PROGRESS (Feb. 15, 2012)

http://www.americanprogress.org/wp-content/uploads/issues/2012/02/pdf/BC_costs.pdf.
82. Id. at 2.
83. Id. at 1.
84. WILLIAM D. MOSHER, PH.D. ET AL., CTRS. FOR DISEASE CONTROL & PREVENTION, USE

OF CONTRACEPTION & USE OF FAMILY PLANNING SERVICES IN THE UNITED STATES: 1982-2002, at
1 (2004), http://www.cdc.gov/nchs/data/ad/ad350.pdf (based on the 1982, 1995, and 2002 National
Surveys of Family Growth).

85. News Release, National Academies, IOM Report Recommends Eight Additional
Preventive Health Services to Promote Women's Health (July 19, 2011), http://www8.
nationalacademies.org/onpinews/newsitem.aspx?RecordID=13181 [hereinafter National Academies
News Release].

86. Id.



2014] NO GOOD DEED 311

In addition, many women use oral contraceptive pills at least in part for health
benefits other than pregnancy prevention.87  A 2011 report found that more than
half of pill users, fifty-eight percent, use the pill for health conditions such as
cramps or menstrual pain, menstrual regulation, acne, and endometriosis.88

Women also use contraception because it helps them achieve their life
goals.89  A 2011 survey found that women reported using contraception because
it allows them to better care for themselves or their families, support themselves
financially, complete their education, or find or maintain work.90  In the United
States, the introduction of safe, effective birth control helped opened economic
doors for women in the 1960s and 1970s.91  As New York Times columnist Gail
Collins explains:    

Young women did not have widespread access to the Pill until the
early 1970s—which not coincidentally was the same time they began to
apply to medical, law, dental, and business schools in large numbers. 
This was an enormous shift. . . . 

Once young women had confidence that they could make it through
training and the early years in their profession without getting pregnant,
their attitude toward careers that required a long-term commitment
changed.92

In addition to economic freedom, widespread access to birth control has also
enhanced women’s sexual freedom and equality.93  Although HHS frames the

87. RACHEL K. JONES, GUTTMACHER INST., BEYOND BIRTH CONTROL: THE OVERLOOKED
BENEFITS OF ORAL CONTRACEPTIVE PILLS 3 (2011), http://www.guttmacher.org/pubs/Beyond-
Birth-Control.pdf.

88. Id.
89. See generally JENNIFER J. FROST & LAURA DUBERSTEIN LINDBERG, GUTTMACHER INST.,

REASONS FOR USING CONTRACEPTION: PERSPECTIVES OF US WOMEN SEEKING CARE AT
SPECIALIZED FAMILY PLANNING CLINICS 2 (2012), http://www.guttmacher.org/pubs/journals/
j.contraception.2012.08.012.pdf.  

90. Id. at 2.
91. GAIL COLLINS, WHEN EVERYTHING CHANGED:  THE AMAZING JOURNEY OF AMERICAN

WOMEN FROM 1960 TO THE PRESENT 102 (2009) (“The [birth control] Pill, which went on the
market in 1960, not only gave women more confidence about their ability to plan a career; it gave
employers more confidence that when a woman said she wasn’t planning to get pregnant, she meant
it.”).

92. Id. 
93. Id. at 102-03 (“And the sexual revolution, which arrived at the same time as widespread

Pill use, reassured [young women] that even if they delayed marriage, they would have the same
opportunities as unmarried young men for a satisfying sexual life.”); see also Linda Greenhouse,
Doesn’t Eat, Doesn’t Pray and Doesn’t Love, N.Y. TIMES, Nov. 27, 2013, http://www.nytimes.
com/2013/11/28/opinion/greenhouse-doesnt-eat-doesnt-pray-and-doesnt-love.html?_r=0.  She
writes:

To the extent that the “contraceptive project” changes anything on the American



312 INDIANA LAW REVIEW [Vol. 47:301

contraception requirement exclusively in terms of health benefits, the economic
and social benefits women derive from widespread access to effective birth
control should not be ignored.94

B.  Religious Concerns and the Cost of Non-Compliance
Some religious sects object on moral and religious grounds to the use of

contraception and sterilization procedures.  Most prominently, the Roman
Catholic Church has long opposed the use of artificial birth control.95  The
Church’s teachings condemn abortion, sterilization, and “any action which either
before, at the moment of, or after sexual intercourse, is specifically intended to
prevent procreation.”96  The United States Conference of Catholic Bishops
(USCCB), an “assembly of the hierarchy” of the Catholic Church in the United
States,97 objects strongly to the characterization of contraception and sterilization
as “preventive” services because pregnancy is “not a disease.”98  In addition, the
USCCB believes that at least one form of FDA-approved contraception is an
abortifacient.99  

reproductive landscape, it will be to reduce the rate of unintended pregnancy and
abortion.  The objection, then, has to be not to the mandate’s actual impact but to its
expressive nature, its implicit endorsement of a value system that says it’s perfectly
O.K. to have sex without the goal of making a baby.  While most Americans surely
share this view, given the personal choices they make in their own lives, many
nonetheless find it uncomfortable to acknowledge.

Id.
94. Greenhouse, supra note 93 (“From the Obama administration’s point of view, of course,

the contraception mandate is about health care. . . . But there’s a missing piece. One of the failures
of the Affordable Care Act saga, it seems to me, has been the president’s unwillingness or inability
to present universal health care as a moral issue, a moral right in a civilized society.”).  

95. See CHARLES E. CURRAN, CATHOLIC MORAL THEOLOGY IN THE UNITED STATES 45-50
(2008) (summarizing the history of the Church’s teachings on artificial contraception). 

96. Pope Paul VI, Humanae Vitae, § 14 (July 25, 1968),  http://www.vatican.va/holy_father/
paul_vi/encyclicals/documents/hf_p-vi_enc_25071968_humanae-vitae_en.html; see also CURRAN,
supra note 95, at 85 (“Pope Paul VI’s encyclical Humanae vitae, written in 1968, reaffirmed the
teachings of the hierarchical magisterium that condemned artificial contraception for spouses.”);
MARTIN RHONHEIMER, ETHICS OF PROCREATION AND THE DEFENSE OF HUMAN LIFE:
CONTRACEPTION, ARTIFICIAL FERTILIZATION, AND ABORTION 33-38 (2010) (summarizing the
philosophical underpinnings of the Roman Catholic Church’s moral teachings on contraception,
as expressed in the Humanae Vitae).

97. About USCCB, U.S. CONF. OF CATHOLIC BISHOPS, http://www.usccb.org/about/index.cfm
(last visited May 12, 2014).  

98. Comments on Interim Final Rules Imposing Contraceptive Mandate, Office of the
General Counsel, U.S. Conference of Catholic Bishops 1 (Aug. 31, 2011) [hereinafter USCCB
Comments], available at http://www.usccb.org/about/general-counsel/rulemaking/upload/
comments-to-hhs-on-preventive-services-2011-08-2.pdf.

99. Id. at 5 (claiming that “studies show that at least one drug approved by the FDA for



2014] NO GOOD DEED 313

Due to its long-standing objection to contraception and sterilization use,
Church leaders assert that “selling, buying, or brokering the coverage” violates
the Church’s moral precepts.100  One Catholic organization asserts that the
purchase of insurance plans that cover contraceptive services violates its
conscience because it would require the organization to “provide, pay for, and/or
facilitate those services to others.”101  The USCCB speculates that “it seems
entirely probable that many individuals and organizations, instead of purchasing
and sponsoring [insurance] plans, will feel obligated in conscience . . . [to drop]
coverage altogether, rather than compromising their religious and moral
beliefs.”102

Not all religious organizations that oppose the inclusion of contraception and
sterilization procedures in the IFR are affiliated with the Catholic Church.  The
Becket Fund for Religious Liberty lists seven cases brought by non-Catholic
employers, all Protestant or non-denominational Christian organizations.103  In
addition, the cases brought by secular businesses with religious owners or
directors represent both Catholic and non-Catholic religious traditions.104  

Under the PPACA, employers may abstain from providing employees with
the “minimum essential coverage.”105  These employers, however, face large tax
penalties equal to the number of employees multiplied by an “applicable payment
amount” of about $167 per month.106  Thus, even the smallest qualifying “large
employer” with fifty employees would incur fines of approximately $8350 per
month.107  A recent news report suggested that Hobby Lobby, a nationwide arts
and crafts retailer founded by evangelical Christians, faces fines of $1.3 million
per day for failing to comply with the IFR.108  As a result, the cost of non-
compliance is likely cost-prohibitive for most religious organizations.  

‘contraceptive use,’ a close analogue to the abortion drug RU-486 (mifepristone), can cause an
abortion when taken to avoid pregnancy”).

100. Id. at 8.
101. Notre Dame Complaint, supra note 51, ¶ 1.  
102. USCCB Comments, supra note 98, at 11.
103. HHS Information Central, supra note 51 (listing the non-Catholic organizations as East

Texas Baptist University, Houston Baptist University, Hobby Lobby, Wheaton, Colorado Christian
University, Geneva College, and Louisiana College).  

104. Id.
105. 26 U.S.C. § 4980H(a) (Supp. 2011).
106. Id. § 4980H(a), (c)(1) (“The term ‘applicable payment amount’ means, with respect to

any month, 1/12 of $2,000.”).
107. Id. § 4980H(c)(1)(A) (“The term ‘applicable large employer’ means, with respect to a

calendar year, an employer who employed an average of at least 50 full-time employees on
business days during the preceding calendar year.”).

108. Eric Marrapodi, Hobby Lobby Finds Way Around $1.3-Million-a-Day Obamacare
Hit—for Now, CNN (Jan. 11, 2013), http://religion.blogs.cnn.com/2013/01/11/hobby-lobbys-1-3-
million-obamacare-loophole/.



314 INDIANA LAW REVIEW [Vol. 47:301

III.  THE CONSTITUTIONALITY OF CONTRACEPTIVE COVERAGE

Imagine that the IFR did not include a religious exemption at all.  Further
imagine that the IFR requires all group health plans sponsored by large employers
to cover contraceptive and sterilization procedures.  Proceeding under these
assumptions, this Note argues that a contraceptive services coverage requirement
does not violate an employer’s religious freedoms under the Free Exercise Clause
or the Religious Freedom and Restoration Act.  This Note first looks to the U.S.
Supreme Court’s decisions in Employment Division, Department of Human
Resources of Oregon v. Smith,109 as well as Church of the Lukumi Babalu Aye,
Inc. v. City of Hialeah110 to examine the constitutionality of a broad contraceptive
coverage requirement.  Second, this Note examines the impact of the Religious
Freedom and Restoration Act (RFRA) on whether a religious exemption is
necessary to protect the religious freedom of employers.111 

A.  Neutral and Generally Applicable—The Smith Standard
The First Amendment provides “Congress shall make no law respecting an

establishment of religion, or prohibiting the free exercise thereof . . . ,”112 but the
Constitution does not describe the extent to which laws may impair religious
exercise.  In Employment Division, Department of Human Resources of Oregon
v. Smith,113 the Court considered whether laws penalizing the consumption of
peyote, a controlled substance, interfered with the free exercise of religion.114 
Smith and Black, members of the Native American Church, were fired from their
jobs after using peyote for sacramental purposes.115  Despite their claim that their
drug use was religiously-motivated, Oregon denied Smith and Black
unemployment benefits because they were fired for work-related misconduct.116 
The Court upheld Oregon’s denial of benefits,117 in part because “an individual’s
religious beliefs [do not] excuse him from compliance with an otherwise valid
law prohibiting conduct that the State is free to regulate.”118  The Court held that
“the right of free exercise does not relieve an individual of the obligation to
comply with a ‘valid and neutral law of general applicability on the ground that
the law proscribes (or prescribes) conduct that his religion prescribes (or
proscribes).’”119  The primary inquiry, therefore, as to whether a law
unconstitutionally burdens religious exercise is whether the law is neutral and

109. 494 U.S. 872 (1990).
110. 508 U.S. 520 (1993).
111. 42 U.S.C. § 2000bb (2006 & Supp. 2011).
112. U.S. CONST. amend. I.
113. 494 U.S. 872.
114. Id. at 874.
115. Id.
116. Id.
117. Id. at 890.
118. Id. at 878-79.
119. Id. at 879 (quoting United States v. Lee, 455 U.S. 252, 263 n.3 (1982)).  



2014] NO GOOD DEED 315

generally applicable.120 
Three years later, the Court applied the Smith test in Church of the Lukumi

Babalu Aye, Inc. v. City of Hialeah.121  In Lukumi, members of the Santeria
religion—a sect that sacrifices animals as a form of worship—announced plans
to build a house of worship, school, cultural center, and museum in the city of
Hialeah, Florida.122  In response to concerns raised by citizens, the city enacted
several ordinances specifically restricting ritual animal sacrifice.123  The Court
ultimately found the city ordinances were neither neutral nor generally applicable
and invalidated the laws.124  

Lukumi and Smith hold that the law may incidentally burden the free exercise
of religion, so long as it does not specifically discriminate against a religious
group or exercise.125  Some employers argue that the IFR specifically targets
religious employers.126  Because many secular employers provided contraceptive
coverage to employees prior to the WHA, the WHA disparately impacts the
religious employers that did not provide contraceptive coverage due to religious
and moral objections.127  However, this Note argues that the WHA and the IFR’s
contraceptive coverage requirement do not violate the standards of neutrality and
general applicability articulated in Smith and Lukumi.  Therefore, the
contraceptive coverage requirement does not violate the First Amendment by
unfairly targeting or discriminating against a particular religious group.  

1.  Neutrality.—Because Lukumi closely examines neutrality and general
applicability, Lukumi is helpful to determine whether the WHA violates the Smith
standard.  Under Lukumi, “the minimum requirement of neutrality is that a law
not discriminate on its face.”128  Without the religious exemption, the relevant
sections of the PPACA,129 the WHA,130 and the IFR131 all appear facially neutral,
making no reference to religious groups or activities.  In contrast, the ordinances
in Lukumi used words with “with strong religious connotations,” which the Court
found were consistent with, though not conclusive proof of, facial

120. Id.
121. 508 U.S. 520, 531 (1993).
122. Id. at 526.
123. Id. at 528-29.
124. Id. at 524.
125. Id. at 531.
126. See, e.g., USCCB Comments, supra note 98, at 8 (“Moral opposition to all artificial

contraception and sterilization is a minority and unpopular belief, and its virtually exclusive
association with the Catholic Church is no secret.  Thus, although the mandate [to provide
contraceptive coverage] does not expressly target Catholicism, it does so implicitly by imposing
burdens on conscience that are well known to fall almost entirely on observant Catholics . . . .”).

127. Id.
128. Lukumi, 508 U.S. at 533.
129. 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011).
130. 42 U.S.C. § 300gg-13(a)(4) (Supp. 2011).  
131. Affordable Care Act Rules, supra note 6.



316 INDIANA LAW REVIEW [Vol. 47:301

discrimination.132  
The Lukumi Court did not stop at facial neutrality.  The Court then looked to

the “record” in the case, including the prior city council enactments, to determine
the “object of the ordinances.”133  The Court found that the city enacted the
ordinances specifically to target the Santeria religion.134  In contrast, nothing in
the legislative history of the WHA suggests that the amendment passed
specifically to target religious employers.  Senator Mikulski introduced the WHA
“to guarantee women access to preventive health care screenings and care at no
cost” and eliminate gender disparities in health care costs.135  Moreover, by basing
preventive services on guidelines supported by HHS, Mikulski noted “all women
will have access to similar preventive services that we women in Congress and
federal employees have.”136  To determine which preventive services to cover,
HHS turned to IOM, which made eight recommendations “based on a review of
existing guidelines and an assessment of the evidence on the effectiveness of
different preventive services.”137  That HHS adopted IOM’s recommendations
without modification leaves little room to argue that the HHS regulations were
religiously, or politically, motivated.138

After examining facial neutrality and the record, the Lukumi Court considered
“the effect of a law in its real operation.”139  After examining the ordinances, the
Court concluded that the “net result” of the carefully drafted laws was that “few
if any killings of animals [were] prohibited other than Santeria sacrifice.”140  The
Court concluded that “Santeria alone was the exclusive legislative concern,” and
therefore the law was not neutral.141  

Perhaps the most persuasive argument against the neutrality of the IFR is that
its operative effect is to discriminate against Catholic religious organizations. 
Although the WHA and the IFR apply broadly to all large employers,142 the
USCCB argues that “the class that suffers under the mandate is defined precisely
by their beliefs in objecting to these [contraceptive and sterilization]
‘services.’”143  That is, because most non-religious organizations provided
coverage for contraception and sterilization procedures before PPACA’s
enactment, the operative effect of the law is to target groups that were not

132. Lukumi, 508 U.S. at 534.
133. Id.
134. Id. at 535.
135. Mikulski Press Release, supra note 75.
136. Id.
137. National Academies News Release, supra note 85.
138. See Final Rule, supra note 31, at 8729 (“The contraceptive coverage requirement is

generally applicable . . . , and is in no way specially targeted at religion or religious practices.”).
139. Lukumi, 508 U.S. at 535.
140. Id. at 536.
141. Id.
142. 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011); 42 U.S.C. § 300gg-13(a)(4) (Supp. 2011).
143. USCCB Comments, supra note 98, at 8.



2014] NO GOOD DEED 317

previously providing coverage for religious reasons.144  Because “[m]oral
opposition to all artificial contraception and sterilization is a minority and
unpopular belief, and its virtually exclusive association with the Catholic Church
is no secret,” the law therefore implicitly targets Catholics “by imposing burdens
on conscience that are well known to fall almost entirely on observant
Catholics.”145  

However, as one commentator has observed, “[e]mployers associated with
the Catholic Church are not the only employers impacted by the mandate.”146 
“[I]ndeed, several secular employers did not provide contraceptive coverage prior
to the federal mandate and must also conform their conduct accordingly.”147 
Moreover, the litigation currently in progress involves employers of various
religious faiths, not only Catholics.148  Thus, the operative effect here does not
mimic the operative effect of the ordinances in Lukumi, where the city ordinances
affected only a specific group of Santeria worshipers.149

2.  General Applicability.—In addition to neutrality, Lukumi discussed and
applied the second prong of the Smith test:  general applicability.150  The Lukumi
Court noted that “[a]ll laws are selective to some extent.”151  However,
“government, in pursuit of legitimate interests, cannot in a selective manner
impose burdens only on conduct motivated by religious belief.”152  Therefore, like
“operative effect,” general applicability looks closely to the affected class to
determine whether the law has “every appearance of a prohibition that society is
prepared to impose upon [the class] but not upon itself.”153  

The HHS regulation is part of a much larger statutory scheme:  specifically,
the portion of the PPACA that regulates employer-sponsored group health
insurance plans.154  Thus, the affected class is defined broadly by statute.155  The
PPACA requires all large employers to provide “minimum essential [insurance]
coverage under an eligible employer-sponsored plan.”156  The WHA merely
clarifies “minimum essential coverage” by delineating a spectrum of required
services.157  Without the religious exemption, the WHA applies to all employers

144. Id.
145. Id.
146. Destyn D. Stallings, Comment, A Tough Pill to Swallow: Whether the Patient Protection

and Affordable Care Act Obligates Catholic Organizations to Cover Their Employees’ Prescription
Contraceptives, 48 TULSA L. REV. 117, 132 (2012).   

147. Id.   
148. See supra Part II.B. 
149. Lukumi, 508 U.S. at 536.
150. Id. at 542.
151. Id.
152. Id. at 543.
153. Id. at 545 (quoting Fla. Star v. B.J.F., 491 U.S. 524, 542 (1989) (Scalia, J., concurring)).
154. 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011).
155. Id.
156. Id. § 4980H(a)(1).
157. 42 U.S.C. § 300gg-13(a)(4) (Supp. 2011).



318 INDIANA LAW REVIEW [Vol. 47:301

that meet the “large employer” criterion, regardless of the employer’s religious
affiliation.158

Again, the USCCB’s argument that “the class that suffers under the mandate
is defined precisely by their beliefs” fails because the statute defines the class by
size.159  Moreover, by defining a “minimum” standard, the WHA necessarily
imputes new obligations upon groups whose plans did not previously cover the
newly required services.160  The guidelines require a full “package” of women’s
health services—including not only contraception and sterilization, but well-
woman visits, screening for gestational diabetes, breastfeeding support and
counseling, and screening and counseling for interpersonal and domestic
violence.161  The requirements suggest neutral standardization of basic women’s
health services much more than invidious targeting of religiously affiliated
employers.  Because the WHA and HHS’s definitions of preventive services are
neutral and generally applicable, the regulation does not require any exemption
or accommodation to be constitutional.

B.  The Religious Freedom and Restoration Act
In addition to the constitutional challenges under Smith, non-exempt religious

employers and other opponents of the IFR have challenged the IFR for violating
the Religious Freedom and Restoration Act (RFRA).162  Historically, RFRA and
Smith are inextricably intertwined.  In 1993, Congress enacted RFRA in response
to the Smith decision.163  After the decision was handed down, Congress sharply
criticized Smith for “virtually [eliminating] the requirement that the government
justify burdens on religious exercise imposed by laws neutral toward religion.”164 
Congress saw Smith as a shift away from the Supreme Court’s previous free
exercise jurisprudence in landmark cases such as Sherbert v. Verner,165 as well as
Wisconsin v. Yoder.166  Both cases interpreted religious freedom broadly and held
that only a compelling state interest may justify any incidental burden on
religious exercise.167  In both Sherbert and Yoder, the Supreme Court strictly
scrutinized the laws at issue and found that the compelling state interests
advanced did not justify the substantial burdens to religious exercise.168  

In Sherbert, a Seventh-day Adventist’s employer fired her for refusing to

158. Id.; 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011).
159. USCCB Comments, supra note 98, at 8.
160. Final Rule, supra note 31, at 8725.
161. Affordable Care Act Rules, supra note 6.
162. 42 U.S.C. § 2000bb (2006 & Supp. 2011).
163. Id. § 2000bb(a)(4).
164. Id.
165. 374 U.S. 398 (1963). 
166. 406 U.S. 205 (1972).  
167. Sherbert, 374 U.S. at 403; Yoder, 406 U.S. at 214.
168. Sherbert, 374 U.S. at 407; Yoder, 406 U.S. at 228-29.



2014] NO GOOD DEED 319

work on Saturday, a day of religious observation.169  Sherbert was unable to find
new work that accommodated her religious practice.170  South Carolina denied
Sherbert unemployment benefits because the state did not consider her inability
to find new work for religious reasons good cause to refuse employment
opportunities.171  The Supreme Court found the state’s denial of benefits a
substantial burden on Sherbert’s religious practice.172  The state argued that its
blanket denial of benefits in religious cases served the compelling state interest
of preventing fraudulent unemployment benefit claims.173  However, because the
state allocated benefits on a case-by-case basis, the Court held that the state’s
denial of Sherbert’s application, despite infringement on her religious practice,
served no compelling state interest.174

In Yoder, Wisconsin imposed a five-dollar fine on a member of the Old Order
Amish for refusing to send his teenage children to public school past eighth
grade, as required by state law.175  Yoder believed that his children’s attendance
at any public or private high school violated his Amish values and beliefs.176  The
Court held that Wisconsin’s requirement substantially burdened Yoder’s religious
exercise.177  Moreover, the Court held that the compelling state interests
advanced, that compulsory education is necessary to create an informed electorate
and that it creates self-reliant and self-sufficient members of society,178 did not
justify the burden.179  

Congress specifically enacted RFRA “to restore the compelling interest test
as set forth in” Sherbert and Yoder and “to guarantee its application in all cases
where free exercise of religion is substantially burdened.”180  RFRA explicitly
prohibits the government from burdening “a person’s exercise of religion even
if the burden results from a rule of general applicability” unless the government
shows the burden 1) “is in furtherance of a compelling governmental interest” and
2) “is the least restrictive means of furthering that compelling governmental
interest.”181  RFRA provides a person claiming violation of RFRA an avenue for
judicial relief.182  Although the Supreme Court held RFRA unconstitutional as

169. Sherbert, 374 U.S. at 399.
170. Id.
171. Id. at 401.
172. Id. at 404.
173. Id. at 407.
174. Id. at 410.
175. Wisconsin v. Yoder, 406 U.S. 205, 208 (1972).
176. Id. at 209.
177. Id. at 219.
178. Id. at 221.
179. Id. at 228-29.
180. 42 U.S.C. § 2000bb(b)(1) (2006 & Supp. 2011).
181. Id. §§ 2000bb-1(a)-(b).
182. Id. § 2000bb-1(c) (“A person whose religious exercise has been burdened in violation of

this section may assert that violation as a claim or defense in a judicial proceeding and obtain
appropriate relief against a government.”).



320 INDIANA LAW REVIEW [Vol. 47:301

applied to the states,183 the Court has applied RFRA to federal law.184  
RFRA therefore sets up a multi-level inquiry to determine whether a law

impermissibly burdens religious exercise.  First, in order to raise a prima facie
case under RFRA, a plaintiff must show that the law at issue would substantially
burden a sincere religious exercise.185  Second, if burdened, the court must then
determine (a) whether there is a compelling state interest that justifies the
substantial burden of religion, and (b) whether the state has adopted the least
restrictive means to achieve its interest.186

1.  Applicability of RFRA.—As an initial matter, RFRA may not apply to
challenges brought by non-exempt religious employers.  In Gonzales v. O Centro
Espirita Beneficente Uniao do Vegetal, the Court held “RFRA requires the
Government to demonstrate that the compelling interest test is satisfied through
application of the challenged law ‘to the person’—the particular claimant whose
sincere exercise of religion is being substantially burdened.”187  Indeed, RFRA
prohibits burdens to “a person’s exercise of religion.”188  Moreover, the two cases
that RFRA references, Sherbert and Yoder, deal with burdens to individual
exercise.189  In the recent challenges to HHS’s regulations, most claims are
brought by religious employers—schools, hospitals, businesses—not
individuals.190  It is unclear if RFRA applies in these cases.191  

2.  Religious Exercise.—Assuming that a court may apply RFRA to an
employer’s free exercise claim, a court must first determine whether the law

183. City of Boerne v. Flores, 521 U.S. 507, 534 (1997) (holding that RFRA exceeds
Congress’s powers to enforce provisions of the Enforcement Clause of the Fourteenth Amendment
by creating “a considerable congressional intrusion into the States’ traditional prerogatives and
general authority to regulate for the health and welfare of their citizens.”) 

184. Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal, 546 U.S. 418, 423 (2006)
(applying RFRA to the Controlled Substances Act when determining whether federal law
impermissibly burdened a religious sect that used banned hallucinogens in a sacramental tea).

185. See id. at 428 (noting that “the Government conceded the [religious sect’s] prima facie
case under RFRA” because “application of the Controlled Substances Act would (1) substantially
burden (2) a sincere (3) religious exercise”).

186. 42 U.S.C. §§ 2000bb-1(a)-(b) (2006 & Supp. 2011); Gonzales, 546 U.S. at 424;.  
187. Gonzales, 546 U.S. at 430-31 (quoting 42 U.S.C. § 2000bb-1(b) (2006 & Supp. 2011)). 
188. 42 U.S.C. § 2000bb-1(a) (2006 & Supp. 2011) (emphasis added).
189. Wisconsin v. Yoder, 406 U.S. 205 (1972); Sherbert v. Verner, 374 U.S. 398 (1963).
190. See generally HHS Information Central, supra note 51. 
191. See Korte v. Sebelius, No. 12-3841, 2012 WL 6757353, at * 3 (7th Cir. Dec. 28, 2012)

(“[T]he government's primary argument is that because K & L Contractors [the plaintiff challenging
the IFR] is a secular, for-profit enterprise, no rights under RFRA are implicated at all.  This ignores
that Cyril and Jane Korte [the business owners] are also plaintiffs.”  Accordingly, the court
permitted the individuals to pursue the RFRA claim.); O’Brien v. U.S. Dep’t of Health & Human
Serv., 894 F. Supp. 2d 1149, 1158 (E.D. Mo. 2012) (questioning RFRA’s application, but
ultimately declining “to reach the question of whether a secular limited liability company is capable
of exercising a religion within the meaning of RFRA or the First Amendment”).



2014] NO GOOD DEED 321

substantially burdens the free exercise of religion.192  This Note argues that a non-
exempt religious organization opposed to the IFR cannot raise a prima facie case
under RFRA because there is no religious exercise at stake.  Specifically, the
purchase of insurance coverage that includes services with which the
employer—but not the ultimate third-party consumer—may disagree does not
qualify as “religious exercise.”  

a.  Deference.—Under RFRA, religious exercise “includes any exercise of
religion, whether or not compelled by, or central to, a system of religious
belief.”193  RFRA fails, however, to further define “exercise.”194  As one scholar
notes:

The First Amendment of the Constitution is the source of protection for
religious liberty . . . .  But the Constitution does not define the operative
terms—“religion,” “exercise,” or “free.”  Courts and scholars, legal and
otherwise, have all wrestled with the definitional problem.  To date, there
has been little consensus.195

By questioning the exercise purportedly burdened, a court risks endorsing a
particular religious belief or questioning the religious value of a sect’s beliefs.196 
In Smith, Justice Scalia noted that “[r]epeatedly and in many different contexts,
we have warned that courts must not presume to determine the place of a
particular belief in a religion or the plausibility of a religious claim.”197  The result
is that courts often defer to a party’s claim that his religious beliefs are
implicated.198

b.  Deference and third parties.—In the forty-eight lawsuits pending at the
time this Note was written, religious organizations and businesses are suing
federal government agencies and directors for alleged violations of their religious
freedoms.199  And yet, Americans typically conceptualize the debate over
insurance coverage for contraception as pitting religious freedoms against
women’s rights.200  As such, the parties to the suits (religious organizations and

192. See Gonzales, 546 U.S. at 428 (noting that “the Government conceded the [religious
sect’s] prima facie case under RFRA” because “application of the Controlled Substances Act would
(1) substantially burden (2) a sincere (3) religious exercise”).

193. 42 U.S.C. § 2000bb-2(4) (2006 & Supp. 2011); id. § 2000cc-5(7)(A).
194. Id. § 2000cc-5.
195. Jonathan C. Lipson, On Balance: Religious Liberty and Third-Party Harms, 84 MINN.

L. REV. 589, 595-96 (2000) (citations omitted). 
196. Id. at 601-02 (“The delicacy of the definitional task appears to reflect at least two related

concerns, one constitutional, the other institutional.  The constitutional concern is the legitimate
fear that the mere act of definition will ‘establish’ a religion, or prefer one denomination to another.
. . . At the institutional level, courts defer because they view themselves as lacking the expertise
to define religion. . . . The anxiety of entanglement reflects this healthy reluctance.”).

197. Emp’t Div., Dep’t of Human Res. v. Smith, 494 U.S. 872, 887 (1990).
198. Lipson, supra note 195, at 600-01.
199. HHS Information Central, supra note 51.
200. See Jim Rutenberg & Marjorie Connelly, Obama’s Rating Falls as Poll Reflects



322 INDIANA LAW REVIEW [Vol. 47:301

the federal government) do not align with the harms on each side of the debate
(religious freedoms and women’s health).  On the one hand, a religious
organization or business owner bringing a suit in this case is the party harmed
when its religious freedoms are restricted.  On the other side, the people harmed
when access to contraception coverage is limited are third parties—the employees
of these organizations who wish to access contraceptive and sterilization services
without paying additional premiums or out-of-pocket costs that insurance does
not subsidize.

The WHA was passed and HHS’s regulations were promulgated to secure for
women broader insurance coverage for health care services they frequently
access.201  In general, the individuals directly benefiting from the coverage of the
WHA’s preventive services, including contraceptive services, are female
employees of businesses and organizations that fall within the PPACA’s
definition of “large employer.”202  Although these women may share the religious
beliefs of their employers, they may not.  For example, the University of Notre
Dame, one of the employers challenging the HHS regulation, claims it “employs
over 5,000 full- and part-time employees and is the largest employer in St. Joseph
County [Indiana]”.203  However, “Notre Dame does not know how many of its
employees are Catholic,” and it is “unclear whether a simple majority of Notre
Dame’s employees are Catholic.”204  Therefore, Notre Dame likely employs non-
Catholic women who would use the group insurance plan to access contraceptive
and sterilization procedures if covered.  Moreover, Notre Dame may employ
Catholic women who, despite the religious tenets of their employer, would still
access these services.205

Because the IFR affects third-party employees, courts should closely
scrutinize the claim that the IFR implicates a religious exercise.  In his article On

Volatility, N.Y. TIMES, Mar. 13, 2012, at A1, A15 (including, among a presidential approval poll,
results from a poll on “The Birth Control Debate” in which respondents were asked whether the
debate was “more about” religious freedom, women’s health and their rights, both, or no answer).

201. See discussion supra Parts I and III.
202. Final Rule, supra note 31, at 8728 (“The Departments aim to reduce these disparities [in

insurance coverage] by providing women broad access to preventive services, including
contraceptive services.”). 

203. Notre Dame Complaint, supra note 51, ¶ 25.
204. Id. ¶ 45.
205. See GUTTMACHER INST., SUPPLEMENTAL TABLES ON RELIGION AND CONTRACEPTIVE USE

(2011), http://www.guttmacher.org/media/resources/Religion-FP-tables.html (showing that ninety-
eight percent of sexually experienced women of child-bearing age who self-identify as Catholic
have used an artificial method of contraception at some point in their lives, but also, eleven percent
of self-identifying Catholic women currently at risk of unintended pregnancy were using no form
of birth control at all).  Based on this study, news reports widely stated that ninety-eight percent of
Catholic women use birth control, but these statements were not accurate.  Glenn Kessler, The
Claim That 98 Percent of Catholic Women Use Contraception: A Media Foul, WASH. POST (Feb.
17, 2012, 6:02 AM), http://www.washingtonpost.com/blogs/fact-checker/post/the-claim-that-98-
percent-of-catholic-women-use-contraception-a-media-foul/2012/02/16/gIQAkPeqIR_blog.html.



2014] NO GOOD DEED 323

Balance:  Religious Liberty and Third-Party Harms, Professor Lipson argues
“deference is unsound when defining an activity as a religious exercise would
have the effect of harming third parties.”206  Moreover, “the [Supreme] Court has
not deferred deeply to claims that conduct is a religious exercise where third
parties would be harmed.”207  On the contrary, “the continuum of deference
suggests that deference declines, and judicial scrutiny increases, in proportion to
the likelihood of third-party harm.”208  Cases on the less deferential end of the
spectrum “involve the overlap of the seemingly disparate worlds of religion and
commerce, where churches seek competitive, tax or other ‘commercial’
advantages not available to secular citizens or groups engaged in the same
conduct.”209  Professor Lipson reviews a series of cases and finds “[i]n most of
these cases, the Court has not deferred to the claim of religious exercise, but
instead independently characterized the transaction that occurred as, for example,
a taxable sale or an employment relationship.”210

c.  Economic transaction.—The IFR regulates only an economic transaction
between an employer and its insurance provider for the health benefit of third-
party employee.  The PPACA creates a regulatory scheme that requires employers
that generally employ fifty or more individuals to provide employees with
minimum insurance coverage.211  The WHA added an additional requirement that
employers provide “additional preventive care and screenings” without cost
sharing.212  By Congress’s directive, it was incumbent on HHS to define these
terms.213  What exactly must an employer provide?  The contraception coverage
requirement is only one of eight services IOM defined and HHS adopted as part
of a package of preventive services.214  In this way, the regulation serves only to
define the minimal coverage and services that every employer must offer.  

Under Professor Lipson’s economic transaction theory, the contraceptive
coverage requirement is precisely the type of commercial transaction a court
should examine closely before exempting an employer for religious reasons.  The
Supreme Court examined similar claims of religious exemption in Tony and
Susan Alamo Foundation v. Secretary of Labor.215  In that case, the petitioner was
a nonprofit religious organization that derived its income from several

206. Lipson, supra note 195, at 595.  
207. Id. at 615.
208. Id.
209. Id. at 616 (citing Jimmy Swaggart Ministries v. Bd. of Equalization of Cal., 493 U.S. 378

(1990); Hernandez v. Comm’r of Internal Revenue, 490 U.S. 680 (1989); Tony & Susan Alamo
Found. v. Sec’y of Labor, 471 U.S. 290 (1985); United States v. Lee, 455 U.S. 252 (1982);
Braunfield v. Brown, 366 U.S. 599 (1961); Follett v. McCormick, 321 U.S. 573 (1944); Murdock
v. Pennsylvania, 319 U.S. 105 (1943)). 

210. Id.
211. 26 U.S.C. § 4980H(a)(1) (Supp. 2011).
212. 42 U.S.C. § 300gg-13(a)(4) (Supp. 2011).
213. Id.
214. Affordable Care Act Rules, supra note 6.
215. 471 U.S. 290 (1985).



324 INDIANA LAW REVIEW [Vol. 47:301

commercial businesses it operated.216  The businesses were staffed by
associates—“drug addicts, derelicts, or criminals before their conversion and
rehabilitation by the Foundation who were compensated in food, clothing, shelter,
and other benefits rather than cash salaries.217  The Secretary of Labor filed an
action against the Foundation for failing to comply with the minimum wage,
overtime, and recordkeeping provisions of the Fair Labor Standards Act.218  The
Foundation argued that it was not subject to the Act because its businesses were
“infused with a religious purpose.”219  The Court held that because “businesses
serve the general public in competition with ordinary commercial enterprises,”220
no religious exercise was implicated and the Foundation was not exempt.221  In
sum, the “Foundation’s commercial activities, undertaken with a ‘common
business purpose,’ [were] not beyond the reach of the Fair Labor Standards Act
because of the Foundation’s religious character . . . .”222  

Similarly, the religious character of a large employer under the PPACA
should not exempt the employer from regulations designed to advance the health
of its employees.  There is no logical reason to distinguish between the health
needs of employees of religious institutions and those of secular institutions. 
Moreover, like Alamo, exempting religious employers from the IFR would create
unfair competitive advantage.  An employer’s overall cost of providing coverage
for contraceptive services is relatively minimal.223  However, when the law sets
the “minimum” coverage threshold at different levels for similarly-situated
employers, a lower minimal coverage requirement creates a competitive
advantage for employers not required to cover the full range of services.224  From
the perspective of a non-religious employer that may not want to provide
insurance coverage for contraceptive services for a non-religious reason such as
cost, the exemption seems competitively unfair.  For these reasons, an economic
transaction made in furtherance of an employment relationship should not be
characterized as a religious exercise.

d.  Employee action & tenuous connection.—Because the IFR regulates an

216. Id. at 292.
217. Id.
218. Id. at 293.
219. Id. at 298.
220. Id. at 299.
221. See also Lipson, supra note 195, at 617-18 (discussing Alamo and its implication for

third-party harms).  
222. Alamo, 471 U.S. at 306.
223. Jacqueline E. Darroch, GUTTMACHER INST., Cost to Employer Health Plans of Covering

Contraceptives: Summary, Methodology and Background (June 1998), http://www.guttmacher.
org/pubs/kaiser_0698.html (finding in 1998 the average annual cost to an employer to provide
contraceptive coverage was an estimated $21.40 per employee).

224. See Alamo, 471 U.S. at 299 (“[T]he payment of substandard wages would undoubtedly
give petitioners and similar organizations an advantage over their competitors.  It is exactly this
kind of ‘unfair method of competition’ that the [Fair Labor Standards] Act was intended to prevent
. . . and the admixture of religious motivations does not alter a business's effect on commerce.”).



2014] NO GOOD DEED 325

economic transaction between an employer and its insurance company for the
benefit of a third-party employee, the link between the employer’s religious
exercise and the employee’s benefit is particularly tenuous.  That is, before any
employer “subsidizes” an employee’s use of contraception or sterilization
procedures, an employee must first choose to access those services.  The U.S.
District Court for the Eastern District of Missouri took this position in O’Brien
v. United States Department of Health & Human Services.225  O’Brien, a Catholic
business owner, brought suit in the Eastern District of Missouri challenging the
HHS regulations.226  The court described the HHS regulation as one that “requires
an outlay of funds that might eventually be used by a third party in a manner
inconsistent with one’s religious values.”227  The court remarked that “[t]he
challenged regulations are several degrees removed from imposing a substantial
burden on [the business], and one further degree removed from imposing a
substantial burden on [the owner].”228  In other words,“[t]he burden of which
plaintiffs complain is that funds, which plaintiffs will contribute to a group health
plan, might, after a series of independent decisions by health care providers and
patients covered by [the business’s] plan, subsidize someone else’s participation
in an activity that is condemned by plaintiffs’ religion.”229  The court held the
regulation was “at most a de minimus [sic] burden on religious practice.”230  

The district court’s definition of the HHS rule as several degrees removed
from plaintiffs’ religious beliefs supports the idea that religious exercise is not
implicated at all.  The link between the third-party’s medical needs and the
employer’s religious convictions is simply too tenuous.  Because the decision to
engage in contraceptive use is entirely employee-driven, there is no appreciable
difference between the employee purchasing birth control using her insurance
plan and the employee using her own salary to purchase birth control pills over
the counter,231 or donating her salary to Planned Parenthood.

e.  The “cost” of religious belief.—Finally, recall that under the PPACA,
employers may abstain from providing employees with the minimum essential
coverage.232  These employers, however, are subject to large tax penalties.233 
Although these fines are extremely expensive, the Supreme Court has held
constitutional in at least one instance a law that burdens only the cost of religious
belief.234  In Braunfeld v. Brown, the court held “the statute at bar [mandating that
all businesses close on Sundays] does not make unlawful any religious practices

225. 894 F. Supp. 2d 1149 (E.D. Mo. 2012).
226. Id. at 1154.
227. Id. at 1160.
228. Id.
229. Id. at 1159.
230. Id. at 1160.
231. Id. (“Already, [the business and owner] pay salaries to their employees—money the

employees may use to purchase contraceptives or to contribute to a religious organization.”).
232. 26 U.S.C. § 4980H(a) (Supp. 2011).
233. Id.
234. Braunfeld v. Brown, 366 U.S. 599 (1961).



326 INDIANA LAW REVIEW [Vol. 47:301

of appellants; the Sunday law simply regulates a secular activity and, as applied
to appellants, operates so as to make the practice of their religious beliefs more
expensive.”235  Similarly, because the HHS rule only regulates a secular
activity—the parameters of an employer-sponsored health insurance plan—and
the alternative to compliance only increases an employer’s costs, it is unlikely
that a court would find the law unconstitutional.

3.  Conclusion.—The IFR does not burden a religious exercise because an
economic transaction between an employer and insurance company on behalf of
an employee does not qualify as religious exercise under RFRA.  This
characterization does not require a court to deny that an individual holds a sincere
religious belief about a medical service.  Under the IFR, religious employees may
still abstain from using contraception.236  And an organization under religious
management is free to express disapproval of those who use contraception.237 
However, holding a religious belief about a service does not mean purchasing (or
not purchasing) insurance coverage on an employee’s behalf is a religious
exercise.  As a result, the IFR may impose upon an employer an obligation to
provide employees with coverage for preventive medical services as part of an
employee benefit package without violating RFRA.

IV.  THE RELIGIOUS EXEMPTION—A PANDORA’S BOX

Now assume, as it does, that the IFR contains a religious exemption.  The
amended regulations specify that a religious employer objecting to contraceptive
use for religious reasons is automatically exempt from providing contraceptive
coverage if the employer:  (1) has the inculcation of religious values as its
purpose; (2) primarily employs persons who share its religious tenets; (3)
primarily serves persons who share its religious tenets; and (4) is a non-profit
organization under section 6033(a)(1) and section 6033(a)(3)(A)(i) or (iii) of the
Code.238  Section 6033(a)(3)(A)(i) and (iii) refer to churches, their integrated
auxiliaries, and conventions or associations of churches, as well as to the
exclusively religious activities of any religious order.239  Because all four criteria
must be met before the exemption applies, the exemption is notably narrow.240 
On February 6, 2013, HHS proposed rules to strike the first three criteria of the

235. Id. at 605.
236. See O’Brien, 894 F. Supp. 2d at 1159 (noting that “Frank O'Brien [the business owner]

is not prevented from keeping the Sabbath, from providing a religious upbringing for his children,
or from participating in a religious ritual such as communion.  Instead, plaintiffs remain free to
exercise their religion, by not using contraceptives and by discouraging employees from using
contraceptives.”).   

237. Id. 
238. Interim Final Rules, supra note 23, at 46,623
239. 26 U.S.C. § 6033(a)(3)(A)(i) (2006); Interim Final Rules, supra note 23, at 46,623.
240. See Stanley W. Carlson-Thies, Which Religious Organizations Count as Religious? The

Religious Employer Exemption of The Health Insurance Law’s Contraceptives Mandate, 13
ENGAGE:  J. FEDERALIST SOC’Y PRAC. GROUPS 58, 59 (2012).



2014] NO GOOD DEED 327

definition.241  Although these changes have not taken effect at the time this Note
was written, HHS claims that the group of qualifying religious employers remains
largely unchanged.242  This Note argues that because HHS chose to include a
narrow exemption, the previously constitutional regulation becomes vulnerable
under Smith and RFRA.    

A.  Problems Under Smith
1.  Neutrality & General Applicability.—Both Smith and Lukumi hold that a

neutral and generally applicable law may incidentally burden religious exercise,
provided the law does not unfairly target a particular religion.243  In Part III, this
Note argues that without the religious exemption, the WHA and the IFR are
neutral and generally applicable.  However, this Note argues that the religious
employer exemption negates the neutrality and general applicability of these laws.

Again, the Lukumi Court breaks its neutrality inquiry into three
factors—facial discrimination, the record, and operative effect.244  On its face, the
religious exemption uses “words with strong religious connotations.”245  The IFR
makes specific reference to “religious values,” “religious tenets,” and
“churches.”246  These words, however, are not dispositive proof of discriminatory
intent.247  

Lukumi also examines the record in the case to find evidence of
discriminatory intent.248  HHS adopted both the religious employer exemption and
the contraceptive coverage requirement when it amended the July 2010 IFR in
August 2011.249  HHS adopted the religious exemption concurrently with the
contraceptive coverage requirement.  Beyond the text of the amended IFR, there
is little record to examine.  In the amendment, HHS notes that it “received
considerable feedback regarding which preventive services for women should be
considered for coverage.”250  HHS briefly summarized the range of comments it
received.251  HHS concluded that HHS should “provide HRSA additional
discretion to exempt certain religious employers from the Guidelines where
contraceptive services are concerned.”252  HHS then adopted a deliberately narrow

241. Proposed Rules, supra note 60, at 8456-57.
242. Id. at 8461.
243. See Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520, 531 (1993);

Emp’t Div., Dep’t of Human Res. of Or. v. Smith, 494 U.S. 872, 879 (1990).
244. Lukumi, 508 U.S. at 533-35.
245. Id. at 534.
246. 26 U.S.C. §§ 6033(a)(3)(A)(i), (iii) (2006); 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4)

(2012). 
247. See Lukumi, 508 U.S. at 534.
248. Id.
249. Interim Final Rules, supra note 23, at 46,623.
250. Id.
251. Id.
252. Id. (emphasis added).



328 INDIANA LAW REVIEW [Vol. 47:301

exemption aimed at “a house of worship and its employees in ministerial
positions.”253  By exercising this discretion, HHS thus abandoned the broad
neutrality of the WHA to create a targeted religious exemption.   

The third prong of Lukumi’s neutrality inquiry is operative effect.254  The
operative effect of the exemption is two-fold.  First, the law divides the large
employers subject to the WHA into two classes based on religious belief.  Large
employers that do not have religious objections to contraception must provide
their employees with insurance plans that cover contraceptive services.255  These
employers must bear the cost of these services.256  On the other hand, only
religious employers that object for religious reasons to contraception are relieved
of this obligation.257  In practice, this creates unfair competitive advantage among
similarly-situated employers, based exclusively on religious belief.258  

Although the operative effect initially appears to benefit (rather than unfairly
burden) religious employers, the narrow exemption also creates an arbitrary and
discriminatory distinction between religious organizations.  For example, two
religious employers—a church and a religiously-affiliated hospital—may share
the same religious objections to contraceptive coverage.  Yet, the IFR exemption
protects only the one that meets all four criteria of the religious definition.  While
the church is “religious enough” to qualify for exemption under the fourth prong
of the religious definition, the hospital is not.259  The IFR exemption is therefore
under-inclusive of religious groups that hold sincerely-held religious objections
to contraception.  In light of the Lukumi factors, the religious exemption fails to
be neutral because it unreasonably discriminates between similarly-situated
religious employers, as well as between religious and secular organizations.

Like operative effect, an inquiry into a law’s general applicability looks to the
affected class to determine the law’s scope.260  Prior to the IFR exemption, the
WHA applied to all employers with at least fifty full-time employees.261  After the
exemption, large employers no longer have to provide the same coverage to meet
the “minimum essential coverage” standard.  The exemption creates a new class
of exempt employers, while subjecting secular employers to additional insurance
coverage minimums.262  The law simply ceases to treat all large employers the
same.

Thus, the IFR likely fails the Smith test for neutrality and general
applicability because it carves out an arbitrary exemption for specific religious
groups, while excluding other religious organizations.  While religious beliefs can

253. Id.
254. Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520, 535 (1993).
255. Affordable Care Act Rules, supra note 6.
256. See discussion supra Part II.B.2.c.
257. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4) (2012).
258. See discussion supra Part II.B.2.c. 
259. 26 U.S.C. §§ 6033(a)(3)(A)(i), (iii) (2006); 45 C.F.R. § 147.130(a)(1)(iv)(B)(4) (2012).
260. Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520, 545 (1993).
261. 26 U.S.C. § 4980H(c)(2)(A) (Supp. 2011).
262. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4) (2012).



2014] NO GOOD DEED 329

be accommodated when religious liberties are at stake, the narrow exemption is
under-inclusive because it fails to include all religious organizations that share the
same religious belief.  Overall, the WHA is less neutral and less generally
applicable after HHS promulgated the IFR.  

2.  System of Individualized Exemptions.—The IFR exemption is also
vulnerable under Smith because it creates a system of individualized exemptions. 
In Smith, the Court declined to apply the Sherbert balancing test, in which only
a compelling government interest can justify a substantial burden on religious
exercise.263  The Court noted that the Sherbert test “was developed in a context
that lent itself to individualized governmental assessment of the reasons for the
relevant conduct.”264  While Smith did not present such a case because it involved
“an across-the-board criminal prohibition on a particular form of conduct,” the
Court noted that the Sherbert test is appropriate where the state has instituted a
system of individual exemptions.265 

The religious exemption in the existing IFR contains three qualifications that
invite individual assessment.266  The organization must first have “the inculcation
of religious values [a]s [its] purpose.”267  In addition, it must both primarily
employ and primarily serve persons who share its religious tenets.268  As one
commentator has noted, “[t]he terms ‘purpose’ and ‘primarily’ are so amorphous
that a court could easily view the exemption provision as a grant of unchecked
discretion.”269  The inclusion of the exemption thus potentially triggers the strict
scrutiny of the Sherbert balancing test, discussed below.

B.  Problems under RFRA
1.  Religious Exercise.—In Part III, this Note argues that the IFR is not

vulnerable under RFRA because the IFR regulates only commercial activity and
thus does not burden religious exercise.270  However, existence of the religious
exemption substantially weakens the argument that an employer’s purchase of
insurance for a third-party employee is not a religious exercise.  The religious
exemption suggests implicitly—if not explicitly—that, in the government’s view,

263. Emp’t Div., Dep’t of Human Res. v. Smith, 494 U.S. 872, 884 (1990); Sherbert v. Verner,
374 U.S. 398, 402-03 (1963).

264. Smith, 494 U.S. at 884.  
265. Id.  Recall that in Sherbert, because the state allocated unemployment benefits on a case-

by-case basis, the Court held that the state’s denial of Sherbert’s unemployment benefits, despite
infringement on her religious practice, served no compelling state interest.  Sherbert, 374 U.S. at
407.

266. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(3) (2012).  The fourth qualification refers to
definitions in separate sections of the Code. 

267. Id. § 147.130(a)(1)(iv)(B)(1).    
268. Id. §§ 147.130(a)(1)(iv)(B)(2)-(3).    
269. Stallings, supra note 146, at 135.   
270. See supra Part III.B.



330 INDIANA LAW REVIEW [Vol. 47:301

the purchase of insurance benefits burdens some religious groups.271  After all, if
there is no religious freedom at stake, why make an exemption at all? 

HHS carved out an exemption for only those religious groups that meet the
narrow definition of religious employer.272  The absurd result of the narrow
exemption is that it fails to exempt all religious employers that share the same,
sincerely-held religious beliefs.  Perhaps nothing concedes this point more clearly
than HHS’s own response to the criticism of the religious exemption.  In response
to more than 200,000 comments it received from the March 2012 ANPRM,273 in
February 2013, HHS announced its intention to provide a new “accommodation”
for non-exempt religious employers.274  The accommodation would create yet
another class of religious employer.275  The class includes an employer that (1)
“opposes providing coverage for [contraceptive and sterilization procedures] on
account of religious objections,” (2) “is organized and operates as a nonprofit
entity,” and (3) “holds itself out as a religious organization.”276  These employers
would be eligible for an accommodation that relieves the employer of
“contracting, arranging, paying, or referring” employees for such coverage.277 
Instead, the employer’s insurance provider would provide a separate
contraceptive coverage plan directly to the employees.278

The proposed accommodation makes abundantly clear the shortcomings of
the narrow religious exemption.  The definition of religious employer simply does
not include the full range of religious employers HHS now seeks to “insulate”
from providing insurance coverage for contraceptive services.279  Together,
HHS’s religious employer exemption and the proposed accommodation implicitly
concede that the contraceptive coverage requirement imposes substantial
constraints on the free exercise of religion.  Therefore, because the IFR
substantially burdens the free exercise of religion, the regulation triggers RFRA’s
strict scrutiny test.

271. Final Rule, supra note 31, at 8727 (“In response to these comments [on the IFR], the
Departments carefully considered whether to eliminate the religious employer exemption or to
adopt an alternative definition of religious employer, including whether the exemption should be
extended to a broader set of religiously-affiliated sponsors of group health plans and group health
insurance coverage.  For the reasons discussed below, the Departments are adopting the definition
in the amended interim final regulations for the purposes of these final regulations while also
creating a temporary enforcement safe harbor, discussed below.”)

272. 45 C.F.R. §§ 147.130(a)(1)(iv)(B)(1)-(4) (2012).
273. Proposed Rules, supra note 60, at 8459.  
274. Id. at 8461.  The accommodation would also apply to student health insurance plans

arranged by qualifying religious institutions of higher education. 
275. Id. at 8462.
276. Id.
277. Id.
278. Id. at 8462-63.  HHS also proposes an accommodation for self-insured employer plans,

in which the employer does not purchase insurance from an insurance company, but uses only a
third-party to administer a group plan fully funded by the employer.  Id. at 8463-64.

279. Id. at 8462.



2014] NO GOOD DEED 331

2.  Strict Scrutiny.—RFRA prohibits the government from substantially
burdening a person’s exercise of religion unless the government shows the burden
(1) “is in furtherance of a compelling governmental interest” and (2) “is the least
restrictive means of furthering that compelling governmental interest.”280 

Senator Mikulski’s remarks when introducing the WHA reveal a number of
arguably compelling interests the government seeks to advance—expanding
women’s access to preventive care, eliminating gender disparities in health care
costs, and standardization of covered insurance services.281  More specific to
contraceptive services, the government might cite the detrimental health effects
the medical community attributes to unintended pregnancies.282  Indeed, HHS
states that the IFR is “designed to serve . . . compelling public health and gender
equity goals.”283  But what is “compelling” to one court may not seem so to
another.  As Justice Scalia warned in Smith, “[i]f ‘compelling interest’ really
means what it says (and watering it down here would subvert its rigor in the other
fields where it is applied), many laws will not meet the test.”284  There is no
guarantee that a court would find the interests the WHA advances compelling.285

Regardless of whether these interests are compelling, the HHS rule does not
employ the least restrictive means to achieve them.  The IFR suggests that an
exemption for some religious employers is necessary to protect those employers’
religious beliefs.  Nevertheless, the exemption is so narrow that it fails to include
all similarly-situated employers with the same religious objection.  It seems that
if the least restrictive means to further the compelling interest is to exempt one
religious employer, the least restrictive means would be to exempt any employer
with a religious objection.  The under-inclusiveness of HHS’s exemption draws
an illogical line between these categories of religious employers.  “Very”
religious employers are exempt from the contraceptive coverage requirement
because the regulation is otherwise too burdensome.  On the other hand, “only
somewhat” religious employers must bear the burden.  

Because the exemption ultimately affects a third-party employee, all religious
exemptions will always fail to achieve the interest advanced.  Imagine two
employees of religious institutions: Anna, an employee of Faithful Church (which
qualifies for an exemption), and Betty, who works at Holy Hospital (which likely
does not qualify).  In both employment situations, the compelling state interests

280. 42 U.S.C. §§ 2000bb-1(a)-(b) (2006 & Supp. 2011).
281. See supra Part III.
282. See supra Part II.
283. Final Rule, supra note 31, at 8729.  
284. Emp’t Div., Dep’t of Human Res. v. Smith, 494 U.S. 872, 888 (1990).
285. See Korte v. Sebelius, No. 12-3841, 2012 WL 6757353, at *4 (7th Cir. Dec. 28, 2012)

(Plaintiffs, Catholic owners of a construction company, appealed the district court’s denial of their
motion for preliminary injunction, which would have prevented enforcement of the contraceptive
coverage requirements.  The Seventh Circuit, in granting their motion for injunction pending
appeal, noted that “[w]hether these interests qualify as ‘compelling’ remains for later in this
interlocutory appeal; the government has not advanced an argument that the contraception mandate
is the least restrictive means of furthering these interests.”).



332 INDIANA LAW REVIEW [Vol. 47:301

and the religious objections are the same.  Anna’s insurance does not cover the
full range of services IOM deemed important for women’s health because HHS
exempts Faithful Church due to its religious beliefs.  In essence, HHS has
determined that Anna’s employer’s religious beliefs outweigh the compelling
interest of providing her with expanded insurance coverage.  On the other hand,
Betty’s employer also sincerely rejects coverage of contraceptive and sterilization
services for religious reasons.  But Betty’s insurance will cover the full range of
women’s health services required, because the compelling government interest
of providing Betty with insurance coverage apparently outweighs Holy Hospital’s
religious objections.  Why leave Anna uncovered if the compelling interest is
women’s health?

The HHS rule reveals the misguided and damaging assumption on which
HHS based the exemption.  On February 15, 2012, HHS wrote that the
narrowness of the exemption is appropriate because “the employees of employers
availing themselves of the exemption would be less likely to use contraceptives
even if contraceptives were covered under their health plans.”286  HHS explicitly
assumes that women like Anna who work for “more religious” institutions are
themselves “more religious.”  Thus, HHS reasons, these employees are less likely
to need insurance coverage for contraceptive services.  But we know nothing
about Anna’s religious convictions or her medical needs.  No matter what they
are, Anna will not receive the same “minimum essential coverage” as a result of
her employer’s religious beliefs.287  Where HHS’s goal is to promote women’s
health, this is an impermissible assumption.  HHS should not evaluate a woman’s
religious conviction or medical needs based on her employer’s religious beliefs. 
And HHS should not relieve her employer of an obligation to provide benefits
that an independent medical body has deemed minimal and essential to her health.

CONCLUSION

The framework of the PPACA, which expands employer-sponsored insurance
programs in order to improve Americans’ access to health care services, presents
unique and interesting legal challenges.  The Women’s Health Amendment and
the HHS regulation require employers to provide insurance coverage for specific
medical services, including contraceptives.  For some employers, the purchase
and use of contraceptives conflicts with their religious beliefs.  Therefore, in an
effort to accommodate the religious beliefs of some employers, the Department
of Health and Human Services crafted a narrow exemption to the contraceptive
services requirement.  

However, the poorly-crafted exemption fails to protect adequately the
healthcare needs of women in the workplace and the sincerely held religious
beliefs of some employers.  By excluding a woman from coverage based on her
employer’s beliefs, the HHS exemption denies the woman access to services
based on religious convictions she may not share.  It is unfair to deny an

286. Final Rule, supra note 31, at 8728.  
287. 26 U.S.C. § 4980H(a) (Supp. 2011).



2014] NO GOOD DEED 333

employee benefits because of her employer’s religious beliefs, particularly if
employees of large employers categorically receive those benefits.  In addition,
the narrowness of the exemption insulates some religious employers from the
requirement, while denying an exemption to employers that share the very same
religious convictions.  If the religious exemption truly seeks to protect the free
exercise of religious employers, the exemption should be available to any
organization that shares the same religious convictions.  

The religious exemption neither protects women’s health interests nor ensures
employers’ religious freedoms.  More importantly, the exemption undermines the
goals of the Women’s Health Amendment.  Congress passed the Women’s Health
Amendment to provide women greater access to preventive care and to decrease
gender-based disparities in health care costs.  To fulfill the promise of the
Amendment, HHS should abandon the exemption and require all employers to
cover the services that the Institute of Medicine recommends as necessary for
women’s health.  In this way, HHS can refocus its attention on advancing the
health of American women.