Vox has published a leaked proposed rule of what is (by my count) the sixth version of the Affordable Care Act’s contraceptive mandate. The 125-page document, if accurate, would allow employers and insurers (both for-profit and non-profit) to seek exemptions from the mandate based on both religious and moral objections. The operative RFRA analysis in Part II begins on page 27.

First, the rule addresses a question which the Court punted on in Hobby Lobby: does the contraceptive mandate advance a compelling governmental interest. Here the Trump Administration expressly repudiates the Obama administration’s finding, citing, inter alia, the inability to accommodate religious objectors as well as the never-ending litigation

The Departments previously concluded that the Mandate served compelling governmental interests, including “public health and gender equality interests.” (78 FR 39872) Based in part on that determination, the Departments provided a narrow exemption covering only churches and their integrated auxiliaries. Other organizations with religious objections were either required to comply with the Mandate or offered only the accommodation process. Despite multiple rounds of rulemaking, however, that accommodation process has not satisfied the religious objections of numerous organizations with sincere religious objections to contraceptive coverage or resolved the pending litigation. To the contrary, the Departments have been litigating RFRA challenges to the Mandate and related regulations for more than five years, and dozens of those challenges remain pending today. That litigation, and the related modifications to the accommodation, have consumed substantial governmental resources while also creating uncertainty for objecting organizations, issuers, third party administrators, and employees and beneficiaries. One significant reason for granting the exemptions set forth in these interim final rules is the Government’s desire to resolve the pending litigation.

Beyond these interests, the government has determined that expanding the exemptions is the best way to comply with RFRA.

But the expanded exemptions for religious objectors also rests on an additional, independent ground: the Departments have determined that, in light of RFRA, an expanded exemption, rather than the existing accommodation, is the most appropriate administrative response to the substantial burden identified by the Supreme Court in Hobby Lobby.

Note the government stops short of saying RFRA compels this result, but that it is “appropriate.” The government makes this point explicit later in the rule:

At the same time, the Departments’ decision to exercise discretion to exempt objecting entities does not rest solely on the Departments’ conclusion that applying the contraceptive coverage requirement to those entities would violate RFRA.

But relying on RFRA is essential in order to reverse the position of the Obama administration, and rebalance the interests.

Nevertheless, given the Departments’ previous assertion that they had a compelling interest to overcome the objections when they were defending challenges to the Guidelines, see, e.g., 78 FR 39886–88, the Departments consider it important to rebalance the Government’s general interest in contraceptive coverage and with the respect the Government owes to the interests of conscientious objectors, and under RFRA, religious objectors specifically.

Further, the government restricts its findings whether a compelling interest exists to “this specific context” and “certain objecting employers.”

That determination rests in part on the Departments’ reassessment of the interests served by the application of the Mandate in this specific context. Although the Departments previously took the position that the application of the Mandate to certain objecting employers served a compelling governmental interest, the Departments have now concluded, after reassessing the relevant interests and for the reasons stated below, that it does not.

To this end, the government looks to RFRA as affording the requisite discretion to decide whether to grant a mere accommodation, or simply exempt objecting employers.

Particularly under those circumstances, the Departments believe that agencies charged with administering a statute that imposes a substantial burden on the exercise of religion under RFRA have discretion in determining whether the appropriate response is to provide an exemption from the burdensome requirement or instead to attempt to create an accommodation that would mitigate the burden. Here, the Departments have now determined that the appropriate administrative response is to create a broader exemption, rather than limiting non-church objecting entities to the accommodation process. That determination is informed by the Departments’ reassessment of the relevant interests, as well as by their desire to bring to a close the more than five years of litigation over RFRA challenges to the Mandate.

This is, to a tee, the precise remedy requested by the Little Sisters of the Poor and other plaintiffs in the contraception mandate litigation–grant a full exemption (as houses of worship received), and not an accommodation (whereby employees still receive coverage).

The question here is not whether the Government’s broad interests in health and equality are compelling. Instead, it is whether, under the ACA, the Government has a compelling interest in denying exemptions to those who object to the contraceptive coverage requirements, after the Departments have rebalanced the broad interests of coverage with the Government’s interests in providing for conscientious objection. Upon further examination of the relevant provisions of the ACA and the administrative record on which the Mandate was based, the Departments have concluded that the application of the Mandate to such entities does not serve a compelling governmental interest.

Apart from RFRA, government stressed the fact that the “Mandate was not imposed by Congress, but rather was the result of HRSA’s discretionary decision to include contraceptives among the preventive services required.”

We begin by noting that Congress did not mandate that contraception be covered at all under the ACA—merely that, among other preventive services to be covered are “such additional preventive care and screenings” for women “provided for in comprehensive guidelines supported by [HRSA].” Congress, thus, left the identification of the required preventive services to administrative discretion. And the fact that Congress granted HHS (through HRSA) discretion to decide whether to require contraceptive coverage at all indicates that the Departments’ judgment about the relative importance of the Government’s interest in applying the Mandate to the narrow category of entities at issue here should carry particular weight.

This argument inverts a point I raised at length in Cato’s brief in Zubik v. Burwell and in Gridlock. The fact that the contours of this mandate came not from Congress, but from an agency, should give pause before allowing the agency to intrude upon fundamental religious rights. (Ironically enough, this was the gravamen of Judge Wynn’s concurring opinion in the Fourth Circuit’s travel ban decision). However, the government claims that this delegation supports the fact that the agencies should be entitled to deference when deciding what the government’s interest is. To the contrary, the fact that Congress showed no awareness of the religious liberty implications of the provision suggests that the agencies don’t have the power to burden free exercise in this fashion. In the end, we reach the same conclusion, but the executive branch’s position (unsurprisingly) leaps over the implications of the major question doctrine.

Critically, the government highlighted what I deemed to be the most objectionable aspect of the HHS rulemaking: the conclusion that because houses of worship are more likely to employ people of the same faith, they receive an exemption, rather than an accommodation.

In previously denying an exemption to eligible organizations, the Departments did not identify data to support a distinction between the beliefs of employees of churches and their integrated auxiliaries on the one hand, and employees of non-profit organizations on the other. Yet the Departments reasoned that the exemption for churches “does not undermine the governmental interests furthered by the contraceptive coverage requirement” because “[h]ouses of worship and their integrated auxiliaries that object to contraceptive coverage on religious grounds are more likely than other employers to employ people of the same faith who share the same objection.” (78 Fed. Reg. 39874) As explained above, that reasoning extends further than the Departments had previously acknowledged, so as to include other non-profit organizations whose principles oppose contraceptive coverage.

This bifurcation, I wrote, was completely arbitrary, not supported by any evidence, and was not subject to any deference. Here, the government expressly repudiates this finding.

Further, the government notes that a number of states that have contraception mandates also have wide-ranging exemptions.

The Departments now find it significant that most other states either offer broader exemptions or impose no contraceptive requirement in the first place.17 The broadening of exemptions contained in these interim final rules does not remove any of the exemptions the Departments previously offered to churches, so that the exemption the Departments provided to group health plans established or maintained by religious employers (78 FR 39874) is continued by these interim final rules. =

This is a point that the original HHS rulemaking completely ignored.

Towards the end of Part II, the government reiterates that it is under no obligation to pay for these services:

As the Government is under no constitutional obligation to fund contraception, cf. Harris v. McRae, 448 U.S. 297 (1980), even more so may the Government refrain from requiring private citizens to cover contraception in violation of their religious beliefs or moral convictions. Cf. Rust v. Sullivan, 500 U.S. 173, 192–93 (1991) (“A refusal to fund protected activity, without more, cannot be equated with the imposition of a ‘penalty’ on that activity.”).

In my forthcoming article, Presidential Maladministration, I discus the concept of presidential reversals, where one administration changes a regulatory position simply because it disagrees with another administration’s policies. This precise issue will be litigated in the context of whether the change is arbitrary or capricious, or is the needed to comport with court rulings, end lengthy litigation a sufficient justification, and accommodate conscientious objectors. The rulemaking tees up this issue at page 54:

We acknowledge that the foregoing analysis represents a change from the policies and interpretations the Departments previously adopted with respect to the Mandate and the governmental interests that underlie the Mandate. These changes in policy are within the Departments’ authority. As the Supreme Court has acknowledged, “[a]gencies are free to change their existing policies as long as they provide a reasoned explanation for the change.” Encino Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2125 (2016) Here, for all of the reasons discussed above, the Departments have determined that the Government’s interest in the application of contraceptive coverage requirements in this specific context to objecting entities does not outweigh the objections of entities and individuals that object to contraceptive coverage on religious grounds or, based on the distinct analysis set forth above, on moral grounds.

Indeed, the government cites the fact that there have been so many modifications as evidence of why deference is appropriate:

Since the beginning of rulemaking on this Mandate, HRSA and the Departments have repeatedly exercised their discretion to create and modify various exemptions within the Guidelines. Over the past almost six years, the Departments: created an exemption only for houses of worship that primarily serve persons who share their religious tenets, and later expanded that exemption to all houses of worship; created a non-enforcement safe harbor for other religious nonprofit organizations, then an accommodation process for those organizations, and later an expanded accommodation to include some for-profit entities; adjusted the forms to be submitted under the accommodation process, expanded it to included additional notices, and later treated other documents as constituting constructive notice. As in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., “the fact that the agency has adopted different definitions in different contexts adds force to the argument that the definition itself is flexible, particularly since Congress has never indicated any disapproval of a flexible reading of the statute.” 467 U.S. 837, 863–64 (1984).

Recall that the initial rulemaking was issued without going through the notice and comment process, citing the urgency of getting contraception coverage to female students at religious universities before the fall semester began. Alas, that deadline extended many, many times, so the urgency was misplaced.

This rule will almost certainly be challenged. Another chapter for the trilogy.