The US Supreme Court has ruled Christian-owned company Hobby Lobby can claim a religious exemption to a legal requirement that employers pay for their workers’ contraception.
The owners of Oklahoma-based craft supply shop chain Hobby Lobby argued the mandate in President Barack Obama’s healthcare law violated their religious beliefs.
The 5-4 decision applies only to “closely held” companies.
It does not apply to other healthcare some find morally objectionable.
The Supreme Court ruled on Monday that some corporations can hold religious objections that allow them to opt out of the requirement, written into Barack Obama’s signature 2010 health overhaul, that companies with 50 or more employees offer a health insurance plan that covers contraception.
The case turned in large part on whether the 1993 Religious Freedom Restoration Act (RFRA), which bars the US government from taking action that “substantially burdens the exercise of religion”, applies to for-profit companies.
The Supreme Court has ruled Hobby Lobby can claim a religious exemption to ObamaCare requirement to pay for workers’ contraception
“We reject [the Department of Health and Human Services’] argument that the owners of the companies forfeited all RFRA protection when they decided to organize their businesses as corporations rather than sole proprietorships or general partnerships,” Justice Samuel Alito wrote for the court.
“The plain terms of RFRA make it perfectly clear that Congress did not discriminate in this way against men and women who wish to run their businesses as for-profit corporations in the manner required by their religious beliefs.”
The decision marks the first time the Supreme Court has found a profit-seeking business can hold religious views under federal law, analysts say.
In a dissenting opinion, Justice Ruth Bader Ginsburg called the ruling a “decision of startling breadth”.
The ruling is a blow to the Patient Protection and Affordable Care Act, which has been beset by legal challenges since it passed in 2010.
However, it is unclear whether any women employees will actually lose birth control coverage, because the Obama administration had already devised a mechanism under which workers of non-profit organizations that object to the contraception mandate could keep coverage without the organization having to pay for it.
In the case decided on Monday, the Supreme Court ruled on challenges by Hobby Lobby and Conestoga Wood Specialties Corp, a wood cabinetmaker owned by Mennonites.
Hobby Lobby, an arts and crafts chain, employs 13,000 full-time employees. Conestoga employs 950 people.
The owners of Hobby Lobby – David Green, Barbara Green and several relatives – had described themselves as “committed evangelical Christians” and said their religious beliefs “forbid them from participating in, providing access to, paying for… or otherwise supporting abortion-causing drugs and devices”.
The Affordable Care Act, known by critics and supporters as ObamaCare, has been subject to countless legal and political challenges from Republicans and conservatives since its passage.
Considered the largest overhaul of the US healthcare system since the 1960s, it aims to extend health insurance coverage to the estimated 15% of the US population who lack it.
The Supreme Court has already ruled on the law. In 2012, the court affirmed the constitutionality of the act’s central provision, a requirement that most individuals who do not receive health insurance from the government or their employers purchase it or face a fine.
The US Supreme Court has ruled that President Barack Obama’s landmark healthcare reform (ObamaCare) act is constitutional.
The court upheld a core requirement known as the “individual mandate” that Americans buy insurance or pay a fine.
Of the nine justices on the bench, Chief Justice John Roberts’ vote was decisive in the Supreme Court’s 5-4 ruling in favor of the law.
The ruling comes months before the US election, with Republicans vowing to push for a repeal of the bill.
Healthcare is a deeply polarizing issue in the US and Republicans strongly opposed Barack Obama’s legislation.
The state of Florida, along with 12 other states, filed a legal challenge to the bill minutes after Barack Obama signed The Patient Protection and Affordable Care Act (ACA) into law in March 2010.
They were later joined by 13 more states, the National Federation of Independent Businesses and several individuals.
The US Supreme Court has ruled that President Barack Obama's landmark healthcare reform (ObamaCare) act is constitutional
Speaking afterwards, President Barack Obama called the court’s decision a victory for the country, saying people would not need to “hang their fortunes on chance” or fear financial ruin if they became sick.
Barack Obama said it was “time to move forward”, and that he would continue to implement and improve the healthcare law.
He added: “We will be better off because we had the courage to pass this law.”
Republican presidential candidate Mitt Romney said the healthcare bill was “bad law yesterday, it’s bad law today”.
“This is a time of choice for the American people. If we’re going get rid of ObamaCare we’re going to have to replace President Obama. My mission is to make sure we do exactly that.”
He called “ObamaCare” a tax rise that would add to the national debt, a “job-killer”, and said it would put the federal government “between you and your doctor”.
Congressional leaders also responded quickly to the verdict. Senate Minority Leader Mitch McConnell, a Republican, said: “We’ve passed plenty of terrible laws around here that were constitutional.”
On the Senate floor, he said the only way to fix the law was “full repeal”.
Meanwhile, the Senate’s Democratic majority leader, Harry Reid, disagreed: “Now that this matter is settled, let’s move on to other things. Like jobs.”
The mandate was eventually upheld by the justices, citing the taxation powers granted to Congress by the US constitution.
Chief Justice John Roberts said: “We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders.
“We ask only whether Congress has the power under the Constitution to enact the challenged provisions.”
A majority of justices agreed that the penalty individuals must pay if they refuse to buy health insurance falls within Congress’ power to levy taxes, upholding the “individual mandate”.
“The mandate can be regarded as establishing a condition – not owning health insurance – that triggers a tax – the required payment to IRS,” Justice John Roberts wrote.
The government’s main argument was that the law was legal under Congress’ ability to regulate “interstate commerce” – but a majority of justices did not agree with this view.
Four dissenting justices said that limits on the power of Congress to regulate commerce and raise taxes “cannot be such as will enable the Federal Government to regulate all private conduct and to compel the States to function as administrators of federal programs.”
“That clear principle carries the day here,” they added.
In an opinion written by Justice Anthony Kennedy, the dissenting justices went further, to say: “In our view, the entire Act before us is invalid in its entirety.”
While the court described the penalty as a tax, it did not invoke a law that could have prevented the justices from ruling on the case.
Under a law called the Anti-Injunction Act, taxes cannot be legally challenged until after they have been levied. This could have delayed a verdict till 2015 – after the “individual mandate” comes into effect and the first round of penalties have been paid.
They were also not required to rule on the issue of “severability”, which would determine whether other parts of the healthcare law could stand even if the mandate was struck down.
In addition to the individual mandate, the Supreme Court was asked consider another part of the law that deals with the expansion of Medicaid, a government healthcare programme for low-income citizens.
The court ruled to limit that provision but did not strike it down altogether, saying Congress could place conditions on the use of federal funds.
“What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding,” the Supreme Court’s opinion said.