WASHINGTON (Reuters) - The U.S. Supreme Court on Monday ruled that owners of private companies can object on religious grounds to a provision of President Barack Obama's healthcare law that requires employers to provide insurance covering birth control for women.
The decision, which applies only to a small number of family or other closely-held companies, means an estimated several thousand women whose health insurance comes via such companies may have to obtain certain forms of birth control coverage elsewhere.
In a 5-4 vote along ideological lines, the justices said the companies can seek an exemption from the so-called birth control mandate of the law known as Obamacare. The companies in the case said they did not object to all birth control but certain methods they said were tantamount to abortion, which they oppose for religious reasons.
In their last decision of the nine-month term, the justices ruled for the first time that for-profit companies can make claims under a 1993 federal law called the Religious Freedom Restoration Act that was enacted to protect religious liberty.
In the majority opinion, conservative Justice Samuel Alito said it was difficult to distinguish between closely held corporations and the people who own them. The religious liberty law was not intended to discriminate "against men and women who wish to run their businesses as for-profit corporations in the manner required by their religious beliefs," he wrote.
In reaching its conclusion, the court touched on questions of corporate rights four years after the justices, in a case called Citizens United v. Federal Election Commission, endorsed broad free-speech rights for companies in the campaign finance context.
One of the two cases was brought by arts-and-crafts retailer Hobby Lobby Stores Ltd, which is owned and operated by David and Barbara Green and their children, who are evangelical Christians. The other case was brought by Norman and Elizabeth Hahn, Mennonites who own Conestoga Wood Specialties Corp in Pennsylvania. None of the companies that have objected are publicly traded. Hobby Lobby has around 13,000 full-time employees while Conestoga Wood has 950.
White House spokesman Josh Earnest said the court's decision "jeopardizes the health of women who are employed by these companies."
U.S. House of Representatives Speaker John Boehner, the top Republican in Congress, called the ruling "a victory for religious freedom and another defeat for an administration that has repeatedly crossed constitutional lines in pursuit of its Big Government objectives." U.S. Senate Majority Leader Harry Reid said his fellow Democrats "will continue to fight to preserve womens access to contraceptive coverage and keep bosses out of the examination room."
WOMEN'S RIGHTS ASSERTED
Women's rights groups said the ruling gave employers too much of a say over private decisions.
"Bosses should stick to what they know best - the board room and the bottom line - and stay out of the bedroom and doctors' offices," said Marcia Greenberger, co-president of the National Women's Law Center.
Hundreds of demonstrators on both sides of one of the most contentious cases of the Supreme Court term converged on the courthouse, wearing costumes, chanting and carrying signs. Some demonstrators chanted, "Keep your boardroom out of my bedroom" and "Separate church and state, women must decide their fate."
Kristina Arriaga, executive director of the Becket Fund for Religious Liberty, which represented Hobby Lobby, said outside the building that the justices had "recognized that American families do not lose their fundamental rights when they own a family business."
Alito wrote that the ruling applied only to the birth control mandate and did not mean companies would necessarily succeed if they made similar claims to other insurance requirements, such as vaccinations and blood transfusions.
Alito indicated that employees could still be able to obtain birth control coverage via an expansion of an accommodation to the mandate that the Obama administration has already introduced for religious-affiliated nonprofits. The accommodation allows health insurance companies to provide the coverage without the employer being involved in the process.
Under the accommodation, eligible non-profits must provide a "self certification", described by one lower court judge as a "permission slip" authorizing insurance companies to provide the coverage. The accommodation, as it applies to religiously-affiliated nonprofit groups, is the subject of a separate legal challenge that is currently being litigated in lower courts. The governments accommodation is less restrictive than requiring employers to fund contraceptive methods that violate their religious beliefs," Alito wrote.
In her dissent Justice Ruth Bader Ginsburg, writing for the liberal wing of the court, cautioned that the decision opened the door to companies opting out of laws.
"In a decision of startling breadth, the court holds that commercial enterprises, including corporations, along with partnerships and sole proprietorships, can opt out of any law ... they judge incompatible with their sincerely held religious beliefs," she wrote.
The case was the second time that the 2010 Affordable Care Act, which extended healthcare insurance coverage to millions, had been before the court. In a landmark 2012 case, the justices upheld by a 5-4 vote the constitutionality of Obamacare's core feature that requires people to get health insurance.
The case has no bearing on the broader fate of the healthcare law and does not affect the vast majority of what the government estimates to be 29.7 million women who currently receive birth control coverage as a result of the law.
The decision will affect similar cases brought by employers around the country. There are 49 cases in total, according to the Becket Fund. Religious institutions are already exempt from the requirement. There are fewer than 20,000 employees in total, including men and women, who work for companies that object to the mandate, according to the Reproductive Research Audit, a group that backs the objecting companies. The group concluded that of that 20,000, around 5,600 are likely to be women of child-bearing age.
Some of the company owners involved in litigation around the country, including Hobby Lobby and Conestoga, object to contraceptive methods such as Teva Pharmaceutical Industries Ltd's Plan B morning-after pill, and ella, made by the Watson Pharma unit of Actavis PLC.
Drug industry analysts said they expected the rulings impact on birth control manufacturers would be minimal. Shares in Teva and Actavis were little changed on Monday.
A Reuters/Ipsos opinion poll before the ruling found a majority of Americans oppose letting employers, based on their religious views, exclude certain contraceptives from workers insurance coverage.
The poll of 10,693 people asked whether employers should be able to choose what forms of contraceptives their health plans provide based on their religious beliefs. Of those responding, 53 percent disagreed and 35 percent agreed. Of those surveyed, 12 percent said they did not know.
The cases are Burwell v. Hobby Lobby and Conestoga Wood v. Burwell, U.S. Supreme Court, No. 13-354, 13-356.
(Additional reporting by Ian Simpson, David Morgan and Will Dunham)