National Healthcare Update: Contraceptive Rule Under Federal Healthcare Law Sparks A Firestorm

By Bonnie Bochniak
MBPA Government Relations

March 16, 2012 – The Michigan Business and Professional Association (MBPA), along with its sister group, the Michigan Food and Beverage Association (MFBA), want to keep you up to date on the federal healthcare law and how it will affect you and your clients.

The latest discussion has been over a rule in the Patient Protection and Affordable Care Act (PPACA) that requires insurance to cover a range of evidence-based preventive services, including contraceptives, free of any cost sharing from the employee. This directive received thunderous objections from those businesses and associations whose religious convictions oppose such a mandate. The debate provoked President Obama to announce a compromise position with regard to church-affiliated employers.

Background: In August 2011, the U.S. Department of Health and Human Services adopted recommendations from the Institute of Medicine identifying eight effective preventive services for women, including contraception services.

Update:

• President Obama in January 2012 called for insurance to cover, at no cost to enrollees, any prescribed FDA-approved contraceptive and related services. The rule exempted churches and other houses of worship, but the exemption did not extend to all employers that were religiously affiliated, such as hospitals and universities.
• Insurers and employers that do not comply with the contraception coverage rule could face federal fines of $100 per day per employee.
• The rule would still apply to all plans, but employers with a religious affiliation who object to covering contraception will have a one-year grace period during which they do not have to comply with the rule. Then, under more detailed rules to be published in the next year, religiously affiliated employers will not have to pay for contraception services in their premiums. Employees will receive coverage free of cost, and insurers will directly provide the coverage. Most importantly, the question still remains: Does the insurance company absorb the cost or will the employer ultimately have to pay for this added coverage?
• There are currently 7 states suing over this new rule

We will continue to keep you up to date when more of the details are released from the Obama Administration. As always, please contact us with any questions or comments.  We enjoy your feedback.

Please visit our website for more and detailed information. Contact our Government Relations Team with questions/comments at: bbochniak@michbusiness.org or by phone at: 517-374-9128.