Seton Hall Law Professor Angela Carmella on Hobby Lobby and Wheaton College

We are very pleased to welcome Angela Carmella, a Professor here at Seton Hall Law, to the blog today. Professor Carmella’s intellectual focus is the intersection of law and religion, specifically the First Amendment’s religion clauses, religious land use, and Catholic social thought.

By Angela Carmella

On Monday, June 30, the U.S. Supreme Court issued its path-breaking decision in Burwell v. Hobby Lobby Stores, Inc. In a 5-4 ruling, the Court held that HHS’s contraception mandate violates the rights under the Religious Freedom Restoration Act (RFRA) of closely-held, for-profit corporations that object to providing this coverage. The mandate requires employers to provide their female employees with insurance coverage for all twenty FDA-approved contraceptives without cost-sharing.  Justice Alito, writing for the majority, repeatedly notes the decision’s narrow applicability to the mandate alone; Justice Ginsburg, in dissent, criticizes the decision for its “startling breadth,” fearing that for-profits will now seek exemptions from other requirements of the Affordable Care Act and from other federal laws, to the detriment of employees and customers.

Critical to the Court’s decision is the “accommodation” currently available to religious nonprofits—charities, colleges, hospitals and the like—that object to providing contraceptive coverage to their female employees (and students).  In contrast to the targeted exemption given specifically to churches and their close affiliates, which leaves employees without this coverage, the accommodation requires the nonprofit’s insurer (or third party administrator for self-insured plans) to provide coverage directly and separately to employees. Thus, the accommodation attempts to respect the twin goals of religious liberty and women’s health.

Justice Alito and Justice Kennedy (who joined the majority opinion but also wrote a separate concurrence) regarded the accommodation as evidence that the government had already devised a mechanism to address the religious objections of employers while advancing its public health goals. For the Court, extending this accommodation to for-profits was an obvious and straightforward way for the government to satisfy RFRA’s requirement that it use the least restrictive means to advance its objectives.

Hobby Lobby consolidated two challenges to the mandate, one brought by the Green family, evangelical Christian owners of the Hobby Lobby arts and crafts stores and Mardel religious book stores, and the other brought by the Hahn family, Mennonite owners of cabinet manufacturer Conestoga Wood Specialties.  They refuse to provide their employees with coverage for four (out of twenty) contraceptives that might interfere with implantation of a fertilized ovum, because to do so would involve them in facilitating abortions. (Some of the other businesses that have brought similar challenges oppose providing coverage for all contraceptives.)

RFRA prohibits government from “substantially burden[ing] a person’s exercise of religion even if the burden results from a rule of general applicability” unless it “demonstrates that application of the burden to the person—(1) is in furtherance of a compelling governmental interest; and (2) is the least restrictive means of furthering that compelling governmental interest.” 42 U.S.C. Secs.2000bb-1(a), (b). RFRA applies to “any exercise of religion, whether or not compelled by, or central to, a system of religious belief.” Sec.2000cc-5(7)(A).

The opinion takes a pragmatic approach, but its driving vision is RFRA’s overarching purpose in this context: to prevent government from excluding religious people “from full participation in the economic life of the Nation” (Alito 46) and to protect the right “to establish one’s religious (or nonreligious) self-definition in the political, civic, and economic life of our larger community.” (Kennedy 2).  The Court first determines that for-profit corporations are “persons” capable of “exercising religion” under RFRA. “[A]llowing Hobby Lobby, Conestoga and Mardel to assert RFRA claims protects the religious liberty of the Greens and the Hahns,” (Alito 21). Their religious liberty here consists in being able to “run their businesses as for-profit corporations in the manner required by their religious beliefs” (Alito 2, emphasis supplied).

Next, rejecting HHS’s argument that the connection between the mandate and any immoral act is too “attenuated,” the Court finds that the “mandate imposes a substantial burden on the ability of the objecting parties to conduct business in accordance with their religious beliefs.” (Alito 36, emphasis in original) Given the prospect of fines against Hobby Lobby of up to $475 million per year, the answer for the majority is clear. The Court refused to scrutinize the claimants’ arguments regarding complicity in immoral conduct, noting that “it is not for us to say that their religious beliefs are mistaken or insubstantial.” (Alito 37)

The majority opinion assumes that the mandate fulfills a compelling governmental interest, while Justice Kennedy’s concurrence makes clear that the government has demonstrated it.  But both opinions focus on the accommodation as the least restrictive alternative to further the government’s compelling interest. Although government provision of contraceptives might be an alternative, the Court concludes that “we need not rely on the option of a new, government-funded program in order to conclude that the HHS regulations fail the least-restrictive means test. HHS itself has demonstrated that it has at its disposal an approach that is less restrictive than requiring employers to fund contraceptive methods that violate their religious beliefs.” (Alito 43) The Court notes that under such an accommodation, female employees of Hobby Lobby, Mardel and Conestoga would receive the contraceptive coverage to which they are entitled under the regulations.

Because the Court does not decide whether the accommodation “complies with RFRA for purposes of all religious claims,” (Alito 44) Justice Ginsburg’s dissent largely ignores the majority’s solution and focuses instead on what she views as a radical interpretation of RFRA that allows businesses to “opt out of any law (saving only tax laws) they judge incompatible” with their beliefs (Ginsburg 1) without regard to the impacts on third parties (like the female employees of objecting businesses).  Her dissent emphasizes the significance of contraception to women’s health, the expenses associated with contraception, and the compelling nature of the government’s interest in an employer-based insurance system that provides it.  She draws a sharp distinction between religious nonprofits, which are accommodated because they “exist to serve a community of believers,” (Ginsburg 29) and commercial entities with diverse workforces.  Justice Ginsburg concludes that not only is the claim of burden on religious exercise too attenuated, but “[i]n view of what Congress sought to accomplish, i.e., comprehensive preventive care for women furnished through employer-based health plans, none of the proffered alternatives would satisfactorily serve the compelling interests to which Congress responded.”  (Ginsburg 30-31)

In other pending cases many religious nonprofits are challenging the accommodation itself as insufficiently protective of their religious liberty. The Court’s praise for this mechanism as meeting the twin goals of religious liberty and women’s health in the for-profit context might be read as a sign that the nonprofits currently in litigation may be sorely disappointed.  But predicting the impact of Hobby Lobby in the nonprofit context became more complicated on July 3, just four days after Hobby Lobby came down, when the Court issued an interim order in Wheaton College v. Burwell.

Wheaton College is a religious nonprofit that is unquestionably eligible for HHS’s accommodation for religiously affiliated institutions. It has challenged the accommodation itself as a violation of RFRA on the grounds that the school will be morally complicit in providing abortifacient coverage when it files the required “self-certification” form; this form, it argues, triggers the third party administrator’s obligations to provide the objectionable coverage.  Without deciding the merits, the Court decided 6-3 that the college need not use the government’s form; since the government is already on notice of its objection, HHS (and its third party administrator) can proceed as though the form had been filed.

One can view this as consistent with Hobby Lobby: as in that case, the Wheaton Court finds a solution that both respects the college’s religious exercise (it does not have to sign) and meets the government’s interest (the third party provides the contraceptive coverage).  But in her dissent to Wheaton, Justice Sotomayor voiced her frustration: since the Court already found that the accommodation was the least restrictive means of furthering the mandate’s goals—indeed, it “served as the premise” for the decision—the “grant of injunctive relief [in Wheaton] simply does not square with the Court’s reasoning in Hobby Lobby.” (Sotomayor 16, 13)

Although it may be impossible to predict Hobby Lobby’s specific impacts in both commercial and nonprofit contexts, two thing are certain: first, the notion that religious liberty and government interests can be reconciled to avoid harms to third parties is now on the table for further consideration; and second, the Court’s broad reading of RFRA marks a new chapter in free exercise jurisprudence.

Monday Morning Recap: The Previous Week (6.30.14-7.6.14) in Drug & Device Law & Policy

Back from the Independence Day break, here’s this week’s Monday Morning Recap, the post where we call out the drug and device law and policy developments that caught our eye and made us think over the previous week.  You can see all of our previous Monday Morning Recap posts here. Credit for the format goes to Seton Hall Law alum Jordan T. Cohen, who used it to great effect in his series of Reform Rodeo posts.

1. Early last week, the Centers for Disease Control released a report documenting the high degree of variation in opioid painkiller prescribing among states. The CDC explained that “[h]ealth issues that cause people pain don’t vary much from place to place—not enough to explain why, in 2012, health care providers in the highest-prescribing state wrote almost 3 times as many opioid painkiller prescriptions per person as those in the lowest prescribing state in the US.”  The CDC concludes that this variation is caused, at least in part, by inappropriate overprescribing in the higher-prescribing states, and argues that: “[m]ore can be done at every level to prevent overprescribing while ensuring patients’ access to safe, effective pain treatment. Changes at the state level show particular promise.“

2. Also last week, as reported by Karla L. Palmer at FDA Law Blog, the Food and Drug Administration “provided drug compounders some pre-Fourth of July fireworks by issuing a slew of ‘policy documents’ as part of the Agency’s implementation of the Compounding Quality Act (‘CQA’) (Title I of the Drug Quality and Security Act (‘DQSA’)), which was enacted November 27, 2013.” Palmer provides a helpful summary of each policy document. Among the points she highlights, “FDA expects to employ a “risk-based enforcement approach’ concerning violative compounded drugs. . . . Based on recent actions, we expect FDA to pay particular attention to whether a pharmacy may not have ‘adequate assurance of sterility.’”

3. Elisabeth Rosenthal’s series “Paying Till It Hurts” at the New York Times is consistently riveting. Her article last week on the rising price of vaccines was no exception. Here’s just one eye-opening highlight: “To deal with the rising prices, some doctors, who say they lose money on every vaccination, reserve their shots for longstanding patients. . . . That is why Breanna Farris, a San Antonio mother, had to call 10 pediatricians in April before she found Dr. Irvin to vaccinate her son, Traven, who is entering kindergarten this fall. The family’s usual doctors do not offer vaccinations, and referred Ms. Farris to local pharmacies (which do not vaccinate children) or the city health clinic (which would not take Traven’s insurance).”

4. In a post at Health Affairs Blog last week, Jonathan Darrow and Aaron Kesselheim explored “the implications of providing patients with expedited access to investigational prescription drugs and medical devices.” Their bottom line: “While timely regulatory review is a useful goal and expedited pathways may be appropriate in certain circumstances, the FDA’s default position should not change. Continued insistence on robust evidence development prior to approval is essential to maintain the high quality standards the public has come to expect from FDA-approved products.”

Health Reform à la Française: Making Class Actions Available for Health-Related Injuries

Proponents of tort reform in the United States often express particular ire at class action lawsuits, which they characterize as bonanzas for lawyers that unjustly penalize businesses while providing few benefits for consumers.  The enactment of legislation limiting class action lawsuits remains the tort reform movement’s primary achievement at the federal level, having succeeded while efforts to enact federal malpractice reform have consistently failed.

In France, by contrast, a key feature of the government’s recent health reform proposal is to expand the role of class actions by making them available to groups of patients harmed by medical interventions.  As explained by Health Minister Marisol Touraine, who announced a package of health law reforms in a press conference in late June,

to reach maturity in the field of health democracy, it is … necessary to strengthen the power given to patients when they are victims of damages. In light of the serial damages in the health sector, a law right could be contemplated: the introduction of class actions. This would represent major progress. Compensations would certainly be determined on a case-by-case basis but our fellow citizens would no longer be alone against the power of some industries.

At first glance, the proposal to introduce health-related class actions seems difficult to reconcile with France’s historic distaste for American-style litigation.  Indeed, American-style class actions were not available in any context in France until just a few months ago, when the Constitutional Court approved a new class action mechanism for financial injuries stemming from consumer and competition law violations.  The proposal to extend this new law to health-related claims by allowing recovery for bodily injuries and other non-pecuniary damages may strike some observers as a departure from other recent French malpractice reform efforts, which have sought to increase the role of no-fault compensation and to promote non-adversarial mechanisms for resolving disputes.

Yet, class actions à la française are not expected to look anything like their American counterparts.  For one thing, the new class action law allows only accredited consumer associations to represent plaintiffs in class action litigation, thereby precluding lawsuits brought by fee-seeking private attorneys.  Moreover, because French law does not allow no-fee contingency arrangements, the associations will be required to advance the costs of the litigation.  In addition, under the new class action law, plaintiffs must explicitly opt in to class action lawsuits, which may make it difficult to assemble classes of any substantial size.  If the class action law is extended to health-related lawsuits, similar limitations would undoubtedly be imposed.

Even with these limitations, the introduction of health-related class actions is likely to significantly shift the power dynamic between plaintiffs and defendants.  The impact would be the greatest in cases against pharmaceutical and medical device manufacturers, as product-related injuries are inherently more amenable to group litigation than claims of professional negligence.  As the proposal moves through the legislative process, it will be interesting to see how industry and other stakeholders respond.

Monday Morning Recap: The Previous Two Weeks (6.16.14-6.29.14) in Drug & Device Law & Policy

We’re back! Today’s Monday Morning Recap calls out the drug and device law and policy developments that caught our eye and made us think over the previous two weeks.  You can see all of our previous posts here. Credit for the format goes to Seton Hall Law alum Jordan T. Cohen, who used it to great effect in his series of Reform Rodeo posts.

1. Making the news over the past two weeks, the anxious wait for the Supreme Court’s decision on the legality of the Patient Protection and Affordable Care Act’s contraceptive mandate in Burwell v. Hobby Lobby Stores. There’s only one place to be this morning starting around 9:15 AM: SCOTUSblog.

2. Also making the news this week, as Anna Edney at Bloomberg reports, the Food and Drug Administration’s ongoing “analysis at the Drug Enforcement Administration’s request on whether the U.S. should downgrade the classification of marijuana as a Schedule 1 drug, said Douglas Throckmorton, Deputy Director for Regulatory Programs at the FDA, at a congressional hearing. … The FDA reviewed marijuana’s status for the DEA in 2001 and 2006 and recommended it remain Schedule 1, Throckmorton said.” Could the third time be the charm?

3. Also at Bloomberg, David McLaughlin reports that “U.S. regulators, armed with a year-old Supreme Court decision, are stepping up probes of pharmaceutical deals that delay the sale of generic drugs, arrangements they view as illegally hurting competition. The Federal Trade Commission has opened new investigations into agreements between generic and brand-name drugmakers that may lead the agency to sue for disgorgement of revenues, said Markus Meier, head of the agency’s health-care division. … ‘Our goal is to bring an end to this practice by whatever means are available to us,’ Meier said in an interview.”

4. At the New York Times, Katie Thomas reports on problems manufacturers have encountered making generic versions of the heart medicine Toprol XL. (I posted about similar problems with generic Wellbutrin XL here.) Thomas writes: “Drug-industry experts said the drug has encountered manufacturing problems because it is an extended-release tablet. … Brand-name companies not only initially hold patents on the active ingredient but also on the way a pill releases a drug. So even if the generic companies can match the ingredient once the patent expires, they must come up with their own methods for release of the drug into the body that do not infringe on a separate patent. They are usually successful, but not always.”

An Autism Diagnosis: Still the Key to Unlocking Needed Services?

Cross-Posted at Bill of Health

In a recent, very moving, post about her son’s diagnosis with autism at age eight, blogger Amy Storch writes: “I guess I should mention the obvious — district services for Autism are much more comprehensive than ADHD.” An autism diagnosis should not, as a matter of law, be the key that unlocks needed special education services. Both autism and ADHD “count” as disabilities under the Individuals with Disabilities Education Act (the relevant regulation is here), and the Act provides that a child with either diagnosis who needs special education services is entitled to an educational program “designed to meet their unique needs.” As a matter of fact, though, an autism diagnosis may mean—as it apparently does in Storch’s school district—a more comprehensive program. An autism diagnosis can also be the key to getting necessary services outside of the school setting, through private health insurance.

According to the advocacy group Autism Speaks, 37 states plus the District of Columbia and the United States Virgin Islands have enacted laws requiring state-regulated private health insurance plans to pay for applied behavior analysis and other therapies children with autism often need. As I blogged about previously here, some of these state insurance mandates are relatively broad—New Jersey’s law requires private insurers to cover applied behavior analysis for children with autism, but also to cover occupational, physical, and speech therapy for individuals with “autism or another developmental disability.” Other states’ mandates, however, are strictly limited to children on the autism spectrum. Daniela Caruso of Boston University School of Law writes about Florida’s decision to limit its insurance mandate to children with autism here, attributing it at least in part to advocates’ success persuading legislators to view autism through a “dual frame of beauty and invasion.”

The Patient Protection and Affordable Care Act’s requirement that individual and small group health insurance plans cover ten essential health benefits, and in particular its requirement that plans cover “rehabilitative and habilitative services and devices,” promised to ease access to applied behavior analysis and other therapies often needed by children by autism. Habilitative care is left undefined in the statute, but it is defined at HealthCare.gov as “[h]ealth care services that help you keep, learn, or improve skills and functioning for daily living,” for example “therapy for a child who isn’t walking or talking at the expected age.”

There is a wrinkle, however. As Michelle Andrews discusses in this article at Kaiser Health News, applied behavior analysis and other therapies might fall into the category “rehabilitative and habilitative services and devices,” but a case can be made that they also fall into another covered category, “mental health and substance use disorder services, including behavioral health treatment.” This is of significance because if autism therapies are habilitative services, they can be subject to non-dollar limits, for example limits on the number of hours or units of service that an insurance company will cover. If they are mental health services, then the Mental Health Parity and Addiction Equity Act of 2008 would apply and such limits might not be permissible.

In her article, Michelle Andrews highlights a bulletin issued by the Connecticut’s Insurance Department in April of this year in which it determined that health insurance plans could convert the dollar limit on “behavioral therapy” set forth in the state’s autism insurance mandate into non-dollar limits. The Insurance Department wrote that “[b]ecause the behavioral therapy benefits are classified as habilitative benefits, they are not considered subject to mental health parity. This is consistent with HHS guidance and with the approach taken by other states.”

Connecticut’s autism insurance mandate defines “behavioral therapy” as “any interactive behavioral therapies derived from evidence-based research, including, but not limited to, applied behavior analysis, cognitive behavioral therapy, or other therapies supported by empirical evidence of the effective treatment of individuals diagnosed with an autism spectrum disorder, that are: (A) Provided to children less than fifteen years of age, and (B) provided or supervised by (i) a behavior analyst who is certified by the Behavior Analyst Certification Board, (ii) a licensed physician, or (iii) a licensed psychologist.” There may be a meaningful difference between “behavioral therapy” and mental health services, but it is not obvious to me from the statutory definition.

Could this be a case where the autism diagnosis functions to limit access to services, however categorized or defined? Michelle Andrews quotes Sara Rosenbaum of George Washington University’s School of Public Health and Health Services as follows: “The parity rule seems to say you can’t play games like this.”

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