In Hobby Lobby, the Court reached a compromise position. Rather than forcing the corporations to pay for the contraceptives, they instead will require the insurance companies to do so.

In the end, however, we need not rely on the option of a new, government-funded program in order to conclude that the HHS regulations fail the least-restrictive-means test. HHS itself has demonstrated that it has at its dis- posal an approach that is less restrictive than requiring employers to fund contraceptive methods that violate their religious beliefs. As we explained above, HHS has already established an accommodation for nonprofit organizations with religious objections. See supra, at 9–10, and nn. 8–9. Under that accommodation, the organization can self- certify that it opposes providing coverage for particular contraceptive services. See 45 CFR §§147.131(b)(4), (c)(1); 26 CFR §§54.9815–2713A(a)(4), (b). If the organization makes such a certification, the organization’s insurance issuer or third-party administrator must “[e]xpressly exclude contraceptive coverage from the group health insurance coverage provided in connection with the group health plan” and “[p]rovide separate payments for any contraceptive services required to be covered” without imposing “any cost-sharing requirements . . . on the eligi- ble organization, the group health plan, or plan partici- pants or beneficiaries.” 45 CFR §147.131(c)(2); 26 CFR §54.9815–2713A(c)(2).38

Justice Kennedy concurred:

But in other instances the Government has allowed the same contraception coverage in issue here to be pro- vided to employees of nonprofit religious organizations, as an accommodation to the religious objections of those entities. See ante, at 9–10, and n. 9, 43–44. The accommodation works by requiring insurance companies to cover, without cost sharing, contraception coverage for female employees who wish it.

Can HHS do this? Do they have the statutory authority?

We should remember that the contraception mandate was not an Act of Congress, but came from HHS regulations. As with all rule-by-blogposts, it is unclear if HHS has the statutory authority to make these rules. Usually, no one has standing to challenge these rules. But here, an injured party would have standing for the executive re-writing of the law.

Update: Apparently Senate Democrats are looking for a legislative response to Hobby Lobby. The odds of that passing are close to zero. So executive action it is.

Update: Time Magazine reports that the Democrats will let this go to a (fruitless) congressional debate for political points, rather than fix it right away.

But Earnest quickly added that President Obama, who has been touring the country promoting his ability to work around Congress, plans no immediate executive actions to remedy the situation created by the Hobby Lobby ruling. “The Supreme Court was ruling on the application of a specific law that was passed by Congress,” Earnest said. “So what we’d like is for Congress to take action to pass another law that would address this problem.”

This is a notable departure in strategy for the White House that is likely to increase the visibility of the issue in an election year, while delaying the arrival of a solution for those women who will now be denied certain contraceptive coverage. All signs Monday pointed to the fact that Democrats would rather stage a political fight over the issue than quickly resolve it for the affected women. Both the Democratic Party and the White House Twitter accounts spend much of the day rallying people to outrage on social media over the decision. “It’s time that five men on the Supreme Court stop deciding what happens to women,” tweeted Senate Majority Leader Harry Reid.

…

The White House, meanwhile, is leaving open the option for unilateral executive action, but only once Congress fails. “We’ll consider whether or not there is a range of other options that may be available that don’t require legislative action,” Earnest said, declining to put a timeframe on the review.

And this quote from Tim Jost is hilarious.

Legal observers say it would not be difficult for the Obama Administration to resolve the situation unilaterally. The Department of Health and Human Services has already taken unilateral executive action to ensure that women employed by religious nonprofits get contraception coverage in cases where the employer declines to pay. “There was nothing in the statute that specifically allowed them to create the exemption for non-profit organizations so I don’t see why they couldn’t extend that to for-profit corporations,” said Timothy Jost, a law professor at Washington and Lee University and an expert on the Affordable Care Act’s regulations. “I don’t know why they couldn’t do it themselves.”

 

They didn’t have the authority to do the non-profit exemption. So why can’t they do it for for-profits!

Update: This quote from Sen. Mike Lee from NRO seems to suggest Lee would be okay with that program, but the quotation seems to be missing the word “but”

“I’ve heard rumors to the effect that they’re going to announce that there will be a government program that will use federal funds to cover anyone who loses coverage as a result of this ruling,” Senator Mike Lee (R., Utah) told National Review Online. Conservatives might not like that use of government funding, [but?] “if they do that, I don’t think anyone would argue that that would fall afoul of this decision,” he said.