Agencies Announce Intention to Begin Rulemaking on Preventive Care Coverage

On August 16, 2021, the DOL, HHS and Treasury announced that they will begin the rulemaking process to amend the rules concerning moral and religious exemptions from the ACA requirement that certain preventive services be covered by plans and issuers without cost sharing. The agencies stated that recent litigation surrounding these exemptions warrant the amendments, although the announcement does not state what the agencies believe needs to be changed or how they propose to change it. The process is expected to begin within the next six months.

The ACA requires most employers to provide certain preventive services, including contraceptive services and items, without cost sharing. Under the ACA, certain qualifying religious employers were already exempt from the contraceptive coverage requirement, and other employers that held religious objections could also request an exemption via an accommodation process. In 2018, HHS finalized rules that expanded the religious exemption by allowing any employer (including non-closely held companies and publicly traded companies) to claim a religious or moral objection to offering certain contraceptive items and services.

These rules were challenged in the courts. Challengers asserted that HHS lacked the authority to promulgate the 2018 rules and that the agency failed to follow the required rulemaking process when it did so. On July 8, 2020, the Supreme Court disagreed with these challenges and remanded them back to the district level for further proceedings.

Although no action is necessary at this point, employers should be aware of this development and expect more agency action in this area. We will follow and report developments as they occur.

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