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Small Business Employee Benefits and HR Blog

Contraceptive Coverage Exemption - Overview

August 10, 2012
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The Affordable Care Act regulations provide an exemption from the requirement to cover contraceptive services without cost-sharing under the newly adopted HRSA guidelines for certain group health plans maintained by an organization that qualifies as a “religious employer” under the regulations.employer healthcare reform

To qualify as a religious employer, an organization must meet all of the following criteria:

  • Inculcation of religious values is the purpose of the organization

  • Primarily employ persons who share the religious tenets of the organization

  • Serve primarily persons who share the religious tenets of the organization

  • Is a nonprofit organization under Internal Revenue Code Sections 6033(a)(1) and 6033(a)(3)(A)(i) or (iii)

Similarly, federal regulatory agencies have established a one-year safe harbor from the contraceptive coverage requirements — until the first plan year that begins on or after Aug. 1, 2013 — for group health plans maintained by an organization that does not qualify for the above exemption but satisfies certain other requirements.

To qualify for this one-year temporary enforcement “safe harbor,” an organization must satisfy all of the following criteria:

  • Is organized and operates as a non-profit entity

  • From Feb. 10, 2012, and onward, has not provided contraceptive coverage at any point by the plan, consistent with applicable state law, because of the organization’s religious beliefs

  • Provides participants a notice, which is provided in the guidance, indicating that contraceptive coverage will not be provided under the plan for the first plan year beginning on or after Aug. 1, 2012. The notice must be provided in any “application materials” distributed in connection with enrollment or re-enrollment in coverage that is effective beginning on the first day of the first plan year that is on or after Aug. 1, 2012.

  • Self-certifies that it satisfies these criteria and documents this self-certification by the first day of the plan year to which the one-year temporary enforcement safe harbor applies

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