23 July 2014

Solving The ACA Religious Employer Problem

How can one resolve the Gordian knot of employers with religious objections to ACA mandated health insurance that are imposed on employees who receive group health insurance from an employer, now that the Hobby Lobby case has held that at least closely held companies can invoke religious exemptions to the ACA coverage mandates.

One of the cleanest approaches borrows a trick from education funding.  Public entities must not advance religious positions.  But, public entities are allowed to give content neutral scholarships and/or vouchers that can be used by individual students or their parents at either religious or non-religious educational institutions.  A mere provision of money controlled by an individual does not offend any legitimate interest of either the provider or the person receiving it.

How does this apply to the ACA?

Any employer could be allowed to opt out of the requirement to provide group health insurance if they instead provide equivalent vouchers for employees to spend on buying individual or family plan health insurance on an exchange and/or funding health savings accounts to pay for co-pays and deductibles.  But, employers who opt to provide group health insurance would not be allowed to opt out of the contraceptive mandate or any of the other mandated benefits of ACA compliant group health insurance plans.  Individuals on the exchanges could purchase plans that opt out of one or more kinds of coverage based upon religious objections - Seventh Day Adventists could buy insurance that doesn't cover blood transfusions, devout Roman Catholics and pro-life Evangelicals could opt out of contraception coverage, and so on, but they couldn't impose their views on others and would have to find an insurer willing to offer compliant coverage or pay the individual mandate penalty.

Hobby Lobby itself tends to enforce a neo-feudalist approach in which the local lord makes decisions on religious conviction for all of his subjects.  In contrast, this solution (which might even be possible on a regulatory basis) reduces to neo-feudal power of employers over their employees on matters of faith, a far better approach in a religiously pluralistic society, that still minimized the amount of health care provided directly by an employer.

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