How Supreme Court Hobby Lobby Case Will Effect California Employees

How Supreme Court Hobby Lobby Case Will Effect California EmployeesIn the recent Hobby Lobby decision, the Supreme Court ruled in favor of exempting closely held corporations from the Affordable Care Act (ACA) contraceptive mandate. This case has created a lot of controversy concerning the extension of corporation’s religious rights, but because the Supreme Court made a narrow decision based on federal, not state law, most employees in California may not be affected by the decision.

California passed the Women’s Contraception Equity Act (WCEA) in 1999, requiring employers who provide employees outpatient prescription drug benefits to “include coverage for a variety of federal Food and Drug Administration approved prescription contraceptive methods designated by the plan.” The Act contains an exemption for “religious employers,” but it does not extend to closely held corporations like Hobby Lobby. The exemption mainly applies to religious non-profits and employers whose primary purpose is religious, such as churches.

However, the WCEA does not apply to companies who are self-insured. In 2013, 61 percent of insured workers in California were part of a self-funded plan. Almost 10,000 California employers are active self-insurers. Even so, many self-insured businesses in California covered birth years before they were required to do so by the federal ACA. Therefore, California officials doubt the Hobby Lobby ruling will cause self-insured businesses to drop coverage for birth control. It is still important for those who are employed by a small or large business that chooses to self-insure to be aware that California law may not pick up where the ACA leaves off.

Twenty-seven other states have laws similar to California’s requiring inclusion of contraceptives in prescription drug coverage. It can be expected that whether Hobby Lobby has any meaningful effect in these states will soon be interpreted.

2017-12-13T21:46:44+00:00 August 7th, 2014|General Labor Law|