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This rule amends the final rules regarding religious and moral exemptions and accommodations regarding coverage of certain preventive services under title I of the Patient Protection and Affordable Care Act.

Statement of Need:

Previous rules, regulations, and court decisions have left many women without contraceptive coverage and access to contraceptive services without cost sharing. This rule seeks to address religious objections to providing contraceptive coverage by honoring the entities' religious objections, while also ensuring that women enrolled in a group health plan established or maintained, or in health insurance coverage offered or arranged, by an objecting entity described in 45 CFR 147.132(a), which does not invoke the optional accommodation (if eligible), have the opportunity to obtain contraceptive services at no cost. This rule would also eliminate the exemption for entities and individuals that object to contraceptive coverage based on non-religious moral beliefs, which prevents access to contraceptive services without cost sharing.

Summary of the Legal Basis:

The Department of Health and Human Services regulations are adopted pursuant to the authority contained in sections 2701 through 2763, 2791, 2792, 2794, 2799A-1 through 2799B-9 of the PHS Act (42 U.S.C. 300gg-63, 300gg-91, 300gg-92, 300gg-94, 300gg-139), as amended.

Alternatives:

In developing this rule, the Departments considered various alternative approaches. The Departments considered maintaining the exemption (along with the existing accommodations and the proposed individual contraceptive arrangement) with respect to group health plans, health insurance issuers, and institutions of higher education that have a non-religious, moral objection to contraceptive coverage. With respect to individuals enrolled in coverage through entities that have a religious objection to contraceptive coverage, the Departments considered an approach under which contraceptive coverage would be available through separate individual insurance policies that cover only contraceptives and in which participants, beneficiaries, and enrollees would have to separately enroll if they desired contraceptive coverage. The Departments also considered an approach under which, if an objecting entity designs or contracts for a health plan without contraceptive coverage, the contraceptive coverage requirement would apply directly to the issuer in the case of a fully insured plan, or the third party administrator in the case of a self-insured plan. The issuer or third party administrator would then be required to fulfill its separate and independent obligation to provide contraceptive coverage. With respect to the proposed changes to 45 CFR 156.50(d), in addition to the proposed submission requirements on the part of the participating issuer, HHS considered whether to condition a provider of contraceptive services’ participation in the individual contraceptive arrangement on the submission to HHS of additional information. In addition to an arrangement with a participating issuer on the Federally-facilitated Exchange or a State-based Exchange on the Federal Platform, HHS considered whether to allow a provider of contraceptive services to arrange with a third party administrator to submit documentation to HHS on their behalf under 45 CFR 156.50(d).

Anticipated Costs and Benefits:

This rule is expected to increase access to contraceptive services without cost sharing through the individual contraceptive arrangement for eligible individuals and the elimination of the exemption for entities and individuals that object to contraceptive coverage based on non-religious moral beliefs. This rule would increase health equity given the disproportionate burden of out-of-pocket spending on contraceptive services currently faced by low-income individuals (as those individuals with lower incomes must spend a greater percentage of their incomes on contraceptive services). This rulei would also lead to better health outcomes for eligible individuals by increasing access to contraceptive services and reducing unintended pregnancies  Participating providers of contraceptive services (including clinicians, facilities, and pharmacies) and issuers would incur costs associated with entering into signed agreements for reimbursement of costs associated with the provision of contraceptive services to eligible individuals, including costs of verifying consumer eligibility and other associated administrative costs. Eligible individuals would incur costs associated with participating in the individual contraception arrangement, including confirming eligibility to their provider of contraceptive services. HHS estimates the total cost to providers of contraceptive services, issuers, and eligible individuals to be approximately $30.2 million annually. The rule would also lead to a reduction in health care costs for individuals, issuers, group health plan sponsors, and states due to reductions in unintended pregnancies.

Risks:

The Departments do not have information on the number of entities and individuals that have claimed a moral exemption to providing contraceptive coverage and are therefore uncertain of the amount of the potential transfer from plans and issuers to participants, beneficiaries, and enrollees due to reduced out-of-pocket spending on contraceptive services associated with the proposed elimination of the exemption for entities and individuals that object to contraceptive coverage based on nonreligious moral beliefs. The Departments estimate that the provision of the individual contraceptive arrangement could lead to a transfer from the Federal Government to individuals (via issuers to providers of contraceptive services) of approximately $49.9 million annually. This estimate is uncertain due to the limited information available in the 2019 user fee adjustment data. The Departments are uncertain as to how the number of participating providers might vary (for example, across rural and urban areas) and how this variation might affect access to services under the individual contraceptive arrangement. Due to the lack of data, the Departments are unable to develop a precise estimate of the number of eligible individuals who might participate in the individual contraceptive arrangement. This overall lack of data leads to uncertainty regarding the magnitudes of the total cost savings to eligible individuals and any resulting potential cost savings to states (associated with reduced spending on State-funded programs that provide contraceptive services or a potential reduction in the number of unintended pregnancies that would otherwise impose costs to states).