The HHS Mandate is "Self-Defeating"? A Federal Court of Appeals Weighs In.

The Court of Appeals for the District of Columbia Circuit issued an important ruling about the HHS Mandate today. The ruling makes several important points, and frames the HHS Mandate debate in a productive way. It's certainly an exciting moment for those of us against the mandate, even though it doesn't go nearly as far as the news is suggesting.

First, what you may already know:

What You May Already Know

Francis and Philip Gilardi, co-owners of Freshway Foods and Freshway Logistics, are Catholics who have conscientiously abstained from providing contraceptive and abortificant coverage in their employee health plans. When they HHS Mandate attempted to force them to buy such insurance, they sued, raising both constitutional and statutory claims.

The Ruling Doesn't Say What You May Have Heard

Francis and Philip Gilardi

LifeSiteNews' headline about this ruling reads "Court Rules Obama Admin Can’t Make Catholic Family Business Follow HHS Mandate." Several secular news sites are claiming similar things. But this isn't accurate. This ruling was about a preliminary injunction. The question was whether the HHS could force Catholic business owners

In other words, the question was whether the HHS Mandate should apply to the Gilardis and Freshway while the case is pending. To make that determination, the court has to look at the likelihood of success on the merits (courts don't want you to be able to delay a law's enforcement by raising frivolous lawsuits). But, and this is the important part, the court isn't actually ruling on the merits yet. The case isn't properly before them yet, and the record created in the district court could change the court's view.

In this case, the district court had ruled against giving the Giraldis and Freshway an injunction on a purely legal question. The Court of Appeals found that the district court erred in the case of the Giraldis, and remanded the case "for consideration of the other preliminary-injunction factors." That's a far cry from ruling that the "Obama Admin Can’t Make Catholic Family Business Follow HHS Mandate."

In any case, the case isn't over yet. In fact, it hasn't even made it to the Court of Appeals yet. That's not the only thing people are getting wrong about this decision, either.

This Isn't Necessarily a First Amendment Case

It looks like this case will turn on religious freedom protections under a federal law, the Religious Freedom Restoration Act (RFRA), rather than under the First Amendment. RFRA was enacted by Congress after a series of Supreme Court religious freedom cases (involving Native American groups' use of banned substances, like peyote, for religious reasons) took a narrow view of First Amendment protections.

RFRA goes beyond the First Amendment (as interpreted by the Supreme Court) in providing beefed-up protections of religious freedom. This means that it's possible (even fairly likely) that the Court of Appeals will ultimately rule that the HHS Mandate is constitutional, but strike it down as a violation of RFRA. Why is this? Because of the question of companies practicing religion....

The Court of Appeals Held Against Secular Organization's Practice of Religion

Based on the Supreme Court's prior decisions, it's not clear if the First Amendment's Free Exercise Clause applies to businesses, or any non-religious organizations or bodies. The Court of Appeals conceeded:

Because the word religion “connotes a community of believers,” the prohibition against the impingement on religious free exercise must be understood to cover the activities of both individuals and religious bodies.

 But this freedom didn't extend beyond religious bodies to include other organizations or institutions. Ultimately, by a 2-1 decision, they decided that:

The free exercise protection—a core bulwark of freedom—should not be expunged by a label. But for now, we have no basis for concluding a secular organization can exercise religion.

Judge Randolph, in his concurring opinion, argued that this holding was premature, because the issue is complex. On the one hand, forcing for-profit corporations to act irreligiously creates troubling precedents:

Senior Judge A. Raymond Randolph

If secular for-profit corporations can never exercise religion, what of profitable activities of organized religions? See Hernandez v. Comm’r, 490 U.S. 680, 709 (1989) (O’Connor, J., dissenting). If only religious for-profit organizations have a free-exercise right, how does one distinguish between religious and non-religious organizations? See Hobby Lobby Stores, 723 F.3d at 1136-37 & n.12; id. at 1170-75 (Briscoe, C.J., concurring in part and dissenting in part). Why limit the free-exercise right to religious organizations when many business corporations adhere to religious dogma? See Mark L. Rienzi, God and the Profits: Is There Religious Liberty for Money-Makers?, 21 GEO. MASON L. REV. (manuscript at 11-24) (forthcoming fall 2013). If non-religious organizations do not have free-exercise rights, why do non-religious natural persons (atheists, for example) possess them? Torcaso v. Watkins, 367 U.S. 488, 495-96 & n.11 (1961).  

On the other hand, he noted that recognizing a corporation's right to practice religion raises potential problems, as well:

If a corporate free-exercise right is recognized, in any form, there are equally challenging secondary questions. How should the beliefs of a religious corporation be determined? Can publicly traded corporations be religious? If so, do they take on the religions of their shareholders as a matter of course? If a religious corporation is sold, does it retain its religious identity? These questions, challenging in themselves, would confront us in different permutations across the diverse entity forms and organizational structures of the American business landscape. 

At the heart of this is an important question that the Court of Appeals doesn't address head-on: can a "for-profit" company pursue a goal other than selfish profit? That is, can a for-profit company have as its goal the betterment of the common good, or some other non-financial goal? Or is that only a right that not-for-profits have?

This about it this way: The HHS Mandate treats all businesses as if they must be amoral and fixated only upon the bottom line:. It obliterates the role of a corporate conscience, simply because it doesn't like the way that corporate conscience is working in this regard. For more on the problems of taking this reductionistic view of the purpose of business, see Alasdair MacIntyre's After Virtue, or Tracey Roland's chapter on "The Epistemic Authority of 'Experts' and the Ethos of Modern Institutions" in Culture and the Thomist Tradition.

Whether the Constitution provides companies with free exercise rights is an important question. But they should act morally (even religiously) regardless. 

More to the heart of the case, the Court of Appeals made a brilliant point...

The Contraceptive Coverage is the Problem, Even if It's Never Used

Fans of the HHS Mandate like to focus on the individual employee's decision whether or not to use contraception, once it's covered. At that point, the employer balking at paying looks like a gross intrusion into the employee's privacy. But this is framing the issue in a misleading way. The violation of the employer's religious freedom happens before anyone decides whether or not to use contraception. Writing for the court, Judge Janice Rogers Brown put it in very clear terms:

Judge Janice Rogers Brown

The only dispute touches on the characterization of the burden. The burden is too remote and too attenuated, the government says, as it arises only when an employee purchases a contraceptive or uses contraceptive services. We disagree with the government’s foundational premise. The burden on religious exercise does not occur at the point of contraceptive purchase; instead, it occurs when a company’s owners fill the basket of goods and services that constitute a healthcare plan. In other words, the Gilardis are burdened when they are pressured to choose between violating their religious beliefs in managing their selected plan or paying onerous penalties. See Thomas, 450 U.S. at 717–18; Wisconsin v. Yoder, 406 U.S. 205, 218 (1972) (“The impact of the compulsory-attendance law on respondents’ practice of the Amish religion is not only severe, but inescapable, for the Wisconsin law affirmatively compels them, under threat of criminal sanction, to perform acts undeniably at odds with fundamental tenets of their religious beliefs.”); Kaemmerling, 553 F.3d at 678. 

Contraception coverage is an economic good. After all, insurance is a product (and a mighty profitable one).

So the question isn't about whether or not employees can buy contraception: they remain free to, regardless of the HHS Mandate. The question is about whether or not the federal government can force companies to purchase a product, contraceptive insurance coverage, to which they're morally opposed.

This point gets lost, in part because those arguing this issue can't grasp why a rational person would be against contraception. If there were a law requiring all companies to include, say, "hitman coverage" (providing, at company expense, murder-for-hire for executives), these same people would immediately recognize the coverage itself is grossly immoral. Forcing a company to buy that sort of coverage would be abhorrent, even if no one ever used it.

This framing turns out to be vitally important, because ...

Framed in this Way, the Violation of Religious Freedom is Clear

Requiring the Giraldis to purchase contraceptive insurance coverage or pay a massive fine creates a "Hobson's choice" infringing the free exercise of their religion. The Court of Appeals put it this way:

The contraceptive mandate demands that owners like the Gilardis meaningfully approve and endorse the inclusion of contraceptive coverage in their companies' employer-provided plans, over whatever objections they may have. Such an endorsement—procured exclusively by regulatory ukase—is a “compel[led] affirmation of a repugnant belief.” See id. That, standing alone, is a cognizable burden on free exercise. And the burden becomes substantial because the government commands compliance by giving the Gilardis a Hobson’s choice. They can either abide by the sacred tenets of their faith, pay a penalty of over $14 million, and cripple the companies they have spent a lifetime building, or they become complicit in a grave moral wrong. If that is not “substantial pressure on an adherent to modify his behavior and to violate his beliefs,” we fail to see how the standard could be met. See Thomas, 450 U.S. at 718. 

That certainly seems clear enough.

The HHS Mandate Is Doomed?

The were two other points that the Court of Appeals made that are exciting and promising. First, that the government's asserted interested in a "right to privacy" makes no sense here:

The government’s invocation of a “woman’s compelling interest in autonomy” is even less robust. The wording is telling. It implies autonomy is not the state’s interest to assert. Nevertheless, the government, quoting Eisenstadt v. Baird, 405 U.S. 438 (1972), claims the mandate protects a woman’s ability to decide “whether to bear or beget a child.” See id. at 453. 

 

Our difficulty in accepting the government’s rationale stems from looking at the Eisenstadt quote in its entirety: “If the right of privacy means anything, it is the right of the individual, married or single, to be free from unwarranted governmental intrusion into matter so fundamentally affecting a person as the decision to bear or beget a child.” Id. (emphasis added). Regardless of what this observation means for us today, it is clear the government has failed to demonstrate how such a right—whether described as noninterference, privacy, or autonomy—can extend to the compelled subsidization of a woman’s procreative practices. 

Second, the government has already undermined any claimed compelling interest by carving a number of exceptions:

Moreover, the mandate is self-defeating. When a government regulation “fail[s] to prohibit nonreligious conduct that endangers [its asserted] interests in a similar or greater degree” than the regulated conduct, it is underinclusive by design. See Lukumi, 508 U.S. at 543. And that underinclusiveness can suggest an inability to meet the narrow-tailoring requirement, as it raises serious questions about the efficacy and asserted interests served by the regulation. In this case, small businesses, businesses with grandfathered plans (albeit temporarily), and an array of other employers are exempt either from the mandate itself or from the entire scheme of the Affordable Care Act. Therefore, the mandate is unquestionably underinclusive. 

In other words, the government claims several reasons that are so compelling that they justify trampling upon the conscience rights of businesses and owners. But in the same breath, the government makes countless exemptions, for "small businesses, businesses with grandfathered plans (albeit temporarily), and an array of other employers." This suggests that the pretextual reasons aren't so compelling after all.

That's what the Court of Appeals means when they say that the mandate is self-defeating. Let's just hope other courts (and especially the Supreme Court) see things the same way.