Insight for Living Ministries v. Burwell et al

Filing 25

MEMORANDUM OPINION AND ORDER GRANTING PRELIMINARY INJUNCTION re 3 MOTION for Preliminary Injunction filed by Insight for Living Ministries. Signed by Magistrate Judge Don D. Bush on 11/25/14. (cm, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
INSIGHT FOR LIVING MINISTRIES,
Plaintiff,
v.
SYLVIA MATTHEWS BURWELL, in her
official capacity as Secretary of the
Department of Health and Human Services;
UNITED STATES DEPARTMENT OF
HEALTH AND HUMAN SERVICES;
THOMAS E. PEREZ, in his official capacity
as Secretary of the United States
Department of Labor; UNITED STATES
DEPARTMENT OF LABOR; JACOB J.
LEW, in his official capacity as Secretary
of the United States Department of Treasury;
and THE UNITED STATES DEPARTMENT
OF TREASURY,
Defendant.

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Case No. 4:14-cv-675

MEMORANDUM OPINION AND ORDER GRANTING PRELIMINARY INJUNCTION
On November 12, 2014, the Court held a hearing on Plaintiff’s Application for Preliminary
Injunction (Dkt. 3). Having considered Plaintiff’s Application for Preliminary Injunction and Brief
in Support Thereof (Dkt. 3), Defendants’ Opposition to Plaintiff’s Motion for Preliminary Injunction
(Dkt. 19), Plaintiff’s Reply (Dkt. 20) and Plaintiff’s Notice of Supplemental Authority (Dkt. 21), as
well as the argument of counsel presented at the hearing and relevant law, Plaintiff’s Application for
Preliminary Injunction (Dkt. 3) is GRANTED.
Insight for Living Ministries (IFLM) seeks a preliminary injunction enjoining Defendants
from enforcing the regulations issued by the Department of Health and Human Services (HHS)
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pursuant to 42 U.S.C. § 300gg-13(a)(4) of the Patient Protection and Affordable Care Act (PPACA),
which require group health plans and health insurance issuers offering group or individual health
insurance coverage to provide “with respect to women, such additional preventive care and
screenings ... as provided for in comprehensive guidelines supported by the Health Resources and
Services Administration for purposes of this paragraph.” 42 U.S.C. § 300gg-13; see also 45 C.F.R.
§ 147.130(a)(1)(iv). The Health Resources and Services Administration, an agency of HHS, adopted
guidelines that define “additional preventive care and screenings” to include all Food and Drug
Administration-approved contraceptives, sterilization, and related education and counseling. See
Coverage of Certain Preventive Services Under the Affordable Care Act, 78 Fed. Reg. 39,870,
39,887 (July 2, 2013). An organization that fails to provide all required coverage is subject to severe
fines and penalties. 26 U.S.C. § 4980D(b)(1). An exemption from the requirement is available to
religious employers as defined in section 6033(a)(3)(A)(i) or (iii) of the Internal Revenue Code of
1986, for employers with “grandfathered health plans,” or for employers with fewer than fifty
employees. Plaintiff IFLM does not qualify for an exemption.
However, an “accommodation” is available to any employer organization to opt out of
providing coverage that “opposes providing coverage for some or all of any contraceptive services
required to be covered...on account of religious objections”. 45 C.F.R. § 147.131(b)(1). To qualify
for the accommodation, the organization must certify to HHS or to its health insurance carrier or
third-party administrator that it (1) opposes providing some or all of any covered contraceptive
services on account of religious objections, (2) operates as a nonprofit entity, and (3) holds itself out
as a religious organization. 45 C.F.R. § 147.131(b)(1)-(4). When an organization self-certifies, HHS
will send a separate notification to the organization’s health insurance carrier or third-party
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administrator (TPA) who then must provide separate payments for any contraceptive services
required to be covered under the law for the organization’s plan participants and beneficiaries for
so long as they remain enrolled in the organization’s plan. 45 C.F.R. § 147.131(c)(2)(i)(B). Once
the organization self-certifies either to HHS or its TPA, as in the case here, the TPA is then required
to provide or arrange for payments for contraceptive services, a requirement imposed through the
Department of Labor’s ERISA enforcement authority. 78 Fed.Reg. 39,879-880.
The regulations are clear that neither the participant/beneficiary nor the self-certifying
organization are liable for any costs of the contraceptive services. The TPA may seek reimbursement
for such payments through adjustments to its Federally-Facilitated Exchange (‘FFE”) user fees. Id.
at 39,882. However, the regulations provide that the TPA may also decline to participate in
providing such coverage. The impact of the PPACA is that, since IFLM is not exempt, it must
directly or indirectly furnish the care to which it objects.
The movant in a preliminary injunction hearing has the burden to demonstrate that (1) the
movant has a substantial likelihood of success on the merits; (2) that the movant will suffer
irreparable harm if the preliminary injunction is not granted; (3) that the threatened harm outweighs
the harm to the opposing party if the preliminary injunction is granted; and (4) that granting the
injunction will not disserve the public interest. See Canal Auth. v. Callaway, 489 F.2d 567, 572 (5th
Cir. 1974).
Plaintiff has asserted nine separate claims for relief in its Complaint (see Dkt. 1), but for the
purposes of its application for preliminary injunction, Plaintiff focuses on its Religious Freedom
Restoration Act (RFRA) claim. Under RFRA, the “Government may substantially burden a person’s
exercise of religion only if it demonstrates that application of the burden to the person — (1) is in
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furtherance of a compelling governmental interest; and (2) is the least restrictive means of furthering
that compelling governmental interest.” 42 U.S.C. § 2000bb-1. In the Fifth Circuit, “a challenged
law substantially burdens religious exercise ‘if it truly pressures the adherent to significantly modify
his religious behavior and significantly violate his religious beliefs.’” Louisiana Coll. v. Sebelius,
Civil Action No. 12-0463, 2014 WL 3970038, at *10 (W.D. La. Aug. 13, 2014) (quoting Adkins v.
Kaspar, 393 F.3d 559, 570 (5th Cir. 2004)). “The effect on religion is substantial when, for
example, a law ‘influences the adherent to act in a way that violates his religious beliefs’ or ‘forces
the adherent to choose between, on the one hand, enjoying some generally available non-trivial
benefit, and, on the other hand, following his religious beliefs.’” Id. Plaintiff’s “religious beliefs
forbid it from participating in, providing access to, paying for, or designating others to pay for certain
drugs, devices, or procedures that harm or kill a fertilized human egg.” Dkt. 3 ¶ 4. The Secretary
does not contest this point.
The cases are clear that, once a court determines that the religious tenet or practice is based
on sincerely held religious beliefs, the court is not free to assess whether it is a central, critical, or
important part of that religion. See Thomas v. Review Bd. of Ind. Emp't Sec. Div., 450 U.S. 707,
717, 101 S.Ct. 1425, 67 L.Ed.2d 624 (1981). IFLM argues that by either notifying HHS or its thirdparty administrator of its objection under the accommodation procedure, it will either be indirectly
or directly participating in or sanctioning the provision of certain contraceptives that it considers to
be abortifacients. The burden not only rests in the notification provisions but in the very fact that
IFLM’s plan provides for the services to which it objects, notwithstanding that it pays nothing for
the services and that the notice of such services are either given contemporaneously or separately
from other information in the plan. The key distinction is that, if it does not accede in the
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accommodation dictated by the regulations, IFLM either faces substantial fines for its religious
beliefs or, if it does accede, its plan (at least indirectly) sponsors services to its participants and
beneficiaries to which it has a moral objection. IFLM’s participants can only receive these services
as a result of plan sponsorship. There is no separate policy issued by another insurer.1
The Court finds, and Defendants do not dispute, that IFLM holds sincere religious beliefs
against providing certain drugs or devices which potentially could harm or kill a fertilized human
egg. The accommodation compels or pressures IFLM to perform an act that it was not already
performing. The nature of the accommodation provided by the Government would cause IFLM to
facilitate, participate, and assist in, actions resulting in the provision of the abortionfacient drugs and
renders IFLM complicit in providing its employees with what it contends are abortionfacient drugs.
The Government, for example, argues that two of the drugs, Plan B and Ella, are used for a variety
of purposes, yet, Plaintiff argues that the principal use is for pregnancy termination to which IFLM
objects on the basis of its sincerely held religious beliefs. As noted, if IFLM does not comply with
the accommodation provision under the regulations, it faces substantial fines.
Defendants’ argument that the accommodation procedure is not a substantial burden on
IFLM’s religious exercise is unpersuasive. As Judge Rosenthal of the Southern District of Texas
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The IFLM plan is a self-insured plan with a third party administrator (TPA). IFLM is
required to self-certify that it will not act as the plan administrator or claims administrator with
respect to contraceptive services or contribute funding of the same. 78 Fed.Reg. 39,879. Upon
receipt of the certification, the TPA may decide not to enter into, or remain in, a contractual
relationship with the eligible organization to provide administrative services for the plan. The
eligible organization is also prohibited from directly or indirectly interfering with the TPA’s
efforts to provide or arrange separate payments for services or from seeking to influence a TPA
decision to provide or arrange such payments. Yet, on the other hand, the Regulations also state
that nothing in the final regulations precludes employers or others from expressing any
opposition to the use of contraceptives. 78 Fed.Reg. 39,888.
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explained:
Both the TPA and issuer provide coverage and payment because the plaintiffs
self-certify their unwillingness to do so through the plan itself. But the plaintiffs’
employees can obtain such coverage and payment only as long as they are the
plaintiffs’ employees and on the plaintiffs’ group health plan. It is the insurance
plan that the religious-organization employer put into place, the issuer or TPA the
employer contracted with, and the self-certification form the employer completes
and provides the issuer or TPA, that enable the employees to obtain the free
access to the contraceptive devices that the plaintiffs find religiously offensive.
Even accepting that the government has succeeded in preventing any payment by
the religious organization for the religiously offensive devices, there is a causal
link between the acts the plaintiffs must do under the accommodation and the
provision of contraceptive devices and products to employees on a no-cost sharing
basis. The effort to accommodate the religious organizations by reducing their
involvement in providing their employees with such access to emergency
contraception did not end the plaintiffs’ involvement so as to avoid required acts
on their part that offend their faith.
E. Tex. Baptist Univ. v. Sebelius, 988 F. Supp. 2d 743, 768-69 (S.D. Tex. 2013) (emphasis added);
see also Eternal Word Television Network, Inc. v. Secretary, U.S. Dep’t of Health & Human Servs.,
756 F.3d 1339, 1347 (11th Cir. 2014) (Pryor, J., specially concurring) (concluding that even if
certification did not “trigger” coverage, without the certification “the administrator has no legal
authority to step into the shoes of the network and provide contraceptive coverage to the employees
and beneficiaries are the [plaintiff]”).
Requiring IFLM to certify its objections to HHS (or to its TPA) requires IFLM to participate
and act in the very arrangement to which it objects on the basis of its sincerely held religious beliefs.
The Court therefore finds that IFLM is substantially burdened in its religious exercise.2
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In Priests for Life et. al. v Unted States Dep’t of Health & Human Servs., No. 13-5368,
the United States Court of Appeals for the D.C. Circuit finds that, under similar facts as those
discussed above, there is no substantial burden on a religious organization to comply with the
accommodation provision. __, F. 3d. __, 2014 WL 5904732, **11- 14 (D.C. Cir. 2014). Under
the D.C. Circuit’s analysis, the regulatory opt-out is a simple process. The D.C. Circuit’s
analysis notes that, even if the court would take as dispositive the plaintiffs’ conviction that the
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IFLM’s position is that its religious beliefs prevent it from merely “washing its hands” and
allowing what it perceives to be a spilling of innocent blood. Of course, the regulations allow it to
advocate its position on abortion as long as that is all it does. The Government, to its credit, has
attempted to find some middle ground between two diametrically opposed positions for which there
is no middle ground, the right and sanctity of life versus the right to choose. Nevertheless, when the
Government superimposes itself as a referee in matters of religion, morals, beliefs, or privacy, it fails
miserably.
Plaintiff contends that the substantial burden imposed upon it under the regulations does not
further a compelling governmental interest, and, even if it did, it is not the least restrictive means of
furthering that compelling governmental interest. Defendants contend that the final regulations
promote two important policy goals. First, the regulations provide women with access to
contraceptive coverage without cost sharing, thereby advancing the compelling governmental
interests in safeguarding public health and ensuring that women have equal access to health care.
Second, the regulations advance these interests in a narrowly tailored fashion that protects certain
nonprofit religious organizations with religious objections to providing contraceptive coverage from
having to contract, arrange, pay or refer for such coverage. 78 Fed.Reg. 39,871. Plaintiff responds

accommodation involves them in providing contraception in a manner that substantially burdens
their religious exercise, it would still sustain the challenged regulations. Id. at *3. The D.C.
Circuit notes that a confluence of compelling interests supports maintaining a seamless
application of contraceptive coverage to insured individuals. Id. In a footnote, the appellate
court also states that the plaintiffs have a fourth option under the Act and that is not to offer any
health insurance and allow the employees to proceed to the Government exchanges which might
be less expensive than providing health insurance. Id. at *10, n. 13. The Court of Appeals finds
that the burden imposed on the plaintiffs is de minimis and that, under the accommodation
provision, the plaintiffs may simply opt out and wash their hands of any involvement. Id. at
**11, 14 (emphasis added). The wording is no doubt particularly poignant for the plaintiffs, who
are Catholic religious organizations. See Matthew 27:24.
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that the mere fact that the Government exempts and accommodates so many organizations under the
law undermines its argument that the interests served by the PPACA are compelling. The Court
agrees.
The PPACA exempts certain health plans that were in effect when the law was passed. These
are called grandfather plans. In 2013, 54% of firms offering health benefits had at least one health
plan that is a grandfather plan. Many of these plans do not offer the services thrust upon IFLM. See
The Kaiser Family Foundation and Health Research & Educational Trust, Employer Health Benefits,
2013 Annual Survey p. 220. For those small firms furnishing coverage with 50 or less employees,
the percentage of covered workers in a grandfather plan was approximately 53%. Id. at 223. For
covered workers enrolled in a plan with employees from 50-199, the percentage in a grandfather plan
was approximately 44%. Id. Although the number of covered workers in a grandfather plan has
been significantly decreasing over the past few years, in 2013, 38% of covered workers were in
grandfather plans. No matter how you cut it, a significant portion of the covered insured or their
beneficiaries in the United States have been left out of the Government’s compelling concern for
women’s health care issues.3
It is no less compelling for an employee of an exempt religious organization or an employee
of a company with less than 50 employees providing no coverage to be relieved from the preventive
health care mandate if the Government is so concerned with preventive healthcare. IFLM argues that
millions of individuals either meet the exemption or do not qualify for coverage under the PPACA
for one reason or another. For example, at the hearing before this Court, the Government conceded
that many unions do not have to provide abortifacient drugs. It is nonsensical that a labor union is
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Three in five covered workers are in a self-funded plan. Id. at 176.
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exempt from providing abortifacient drugs when a religious nonprofit organization is not exempt but
must seek an accommodation.
Even if the Court were to find the cited governmental interest compelling, Defendants have
not shown that the accommodation regime is the least restrictive means of achieving the
governmental purpose. See E. Tex. Baptist Univ. v. Sebelius, 988 F. Supp. 2d 743, 770 (S.D. Tex.
2013) (discussing several “less restrictive means” identified by courts).
IFLM will suffer further irreparable harm if the injunction is denied and it is forced to litigate
its constitutional claims under the overwhelming weight of substantial fines for its noncompliance.
Plaintiff’s injury outweighs Defendants’ injury if the injunction is granted. The injunction maintains
the status quo between the parties. Finally, public interest is not disserved by granting the injunction
because “[p]rotecting constitutional rights and the rights under RFRA are in the public’s interest.”
Id. at 771. IFLM is entitled to a preliminary injunction.
The Court acknowledges that there is no easy solution to the problem addressed and that in
any event the issue will be taken up by any number of higher courts before it is put to rest. At the
hearing before this Court, the Government’s position was advocated well. But in the end analysis,
when the issue is a close one, the Court will err on the side of the First Amendment which prohibits
Congress from making any law impeding the free exercise of religion — whether that law has a
direct effect or indirect effect on the free exercise of the same.
Plaintiff’s Application for Preliminary Injunction (Dkt. 3) is GRANTED. Plaintiff’s
religious exercise is substantially burdened by the mandate to provide certain contraceptives under
the PPACA and the religious employer accommodation promulgated by HHS. Defendants are
enjoined from enforcing against Insight for Living Ministries the substantive requirements set forth
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in 42 U.S.C. § 300gg-13(a)(4) and its implementing guidelines and regulations, and from assessing
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fines or taking other enforcement action against Insight for Living Ministries for noncompliance.
This preliminary injunction takes effect immediately, and shall remain in effect pending entry of
final judgment in this matter or further order of this Court.
SO ORDERED.
SIGNED this 25th day of November, 2014.
.

____________________________________
DON D. BUSH
UNITED STATES MAGISTRATE JUDGE

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