Article

Contraceptive Controversy

Randy Reed was one of a number of business owners who opposed an order to provide coverage for the ‘morning after’ pill, and his side prevailed in a recent Supreme Court decision.

September 2014, Auto Dealer Today - Feature

by Toni McQuilken

Randy Reed (right), owner and president of Randy Reed Automotive, stands with son Trevin, the two-rooftop auto group’s manager. The Reed family formally opposed an ACA provision that requires employers to cover emergency contraception in their employees’ health plans. 
Randy Reed (right), owner and president of Randy Reed Automotive, stands with son Trevin, the two-rooftop auto group’s manager. The Reed family formally opposed an ACA provision that requires employers to cover emergency contraception in their employees’ health plans. 
When Randy Reed first read through the Affordable Care Act (ACA), he was not happy with what he found. Also known as “Obamacare,” President Barack Obama’s signature legislation ignited widespread debate over provisions that require employers to provide healthcare coverage, including birth control. Reed, the owner of the two-rooftop Randy Reed Automotive group in Kansas City, Mo., took exception with the inclusion of the so-called “morning after” pill, a contraceptive method he feels is in violation of his religious beliefs.

Reed was left with the decision to break the law or his moral code, and that did not sit well with him. He decided to join other small business owners across the United States in calling for change.

Burwell v. Hobby Lobby

In September 2012, the Green family, owners of Oklahoma City-based Hobby Lobby Stores Inc., filed suit against former Health and Human Services (HHS) Secretary Kathleen Sebelius. The Greens claimed the provisions of the ACA that require coverage for emergency contraception violated their Christian beliefs. The HHS and Sebelius’ successor, Sylvia Burwell, argued that the provision guaranteed the right of all women to a certain level of healthcare. As expected, the case would ultimately be argued before the U.S. Supreme Court.

The morning after pill lay at the heart of the case. Each pill or combination of pills contains a high dose of one or more hormones that, when taken shortly after unprotected sex, can prevent pregnancy by delaying fertilization or ovulation. The pill became widely available in the mid-to-late 1990s, inciting a fierce debate about when life begins — and the difference between “contraceptive” and “abortion.”

Hobby Lobby’s attorneys argued that the Green family believes life begins at the moment of conception, and requiring them to cover emergency contraception was akin to forcing them to pay for an abortion. They weren’t alone. A suit filed by another company, Conestoga Wood Specialties, was joined with the Hobby Lobby case, and at least 50 small business owners sought and received temporary relief from offering the disputed coverage.

Randy Reed filed for his injunction in December 2013, then awaited the Supreme Court’s verdict. “[This decision] would stem from my faith belief system, that abortion is wrong,” he says. “When I found out they included what was, in my opinion, near-term abortion methods, I felt like I had to seek relief from violating my conscience. I called the insurance company and asked to have that taken out of my plan, and they couldn’t do it. So I felt I had no other recourse than to file a lawsuit against the federal government.”

Reed says he is not opposed to providing coverage for other forms of birth control. “We will still cover contraceptives, just not early-term abortion methods,” he says. “I see a difference [between] preventing contraception and a pill you take the morning after; it all comes down to science of when life begins, and based on ideology, I’m going to stick with life begins at conception or fertilization. And that’s where I’m going to draw the line.”

“There are other ways in which Congress or HHS could equally ensure that every woman has cost-free access to the particular contraceptives at issue here and, indeed, to all FDA-approved contraceptives.” — U.S. Supreme Court Justice Samuel Alito, writing for the majority in Burwell v. Hobby Lobby
“There are other ways in which Congress or HHS could equally ensure that every woman has cost-free access to the particular contraceptives at issue here and, indeed, to all FDA-approved contraceptives.” — U.S. Supreme Court Justice Samuel Alito, writing for the majority in Burwell v. Hobby Lobby
“The exemption … would override significant interests of the corporations’ employees and covered dependents. It would deny legions of women who do not hold their employers’ beliefs access to contraceptive coverage that the ACA would otherwise secure.” — U.S. Supreme Court Justice Ruth Bader Ginsburg, writing for the minority. 
“The exemption … would override significant interests of the corporations’ employees and covered dependents. It would deny legions of women who do not hold their employers’ beliefs access to contraceptive coverage that the ACA would otherwise secure.” — U.S. Supreme Court Justice Ruth Bader Ginsburg, writing for the minority. 
The Decision

In June, the Supreme Court sided with Hobby Lobby by the slimmest of margins, deciding the case by a 5-4 vote. Justice Samuel A. Alito Jr. wrote the opinion for the majority, noting they believe the 1993 Religious Freedom Restoration Act (RFRA) covers privately owned companies controlled by a single family. “Under RFRA, a government action that imposes a substantial burden on religious exercise must serve a compelling government interest, and we assume that the HHS regulations satisfy this requirement,” Alito wrote. “But in order for the HHS mandate to be sustained, it must also constitute the least restrictive means of serving that interest, and the mandate plainly fails that test. There are other ways in which Congress or HHS could equally ensure that every woman has cost-free access to the particular contraceptives at issue here and, indeed, to all FDA-approved contraceptives.”

Alito went on to note that RFRA includes corporations as a “legal fiction” designed to protect the individuals within that corporation. “A corporation is simply a form of organization used by human beings to achieve desired ends,” Alito wrote. “An established body of law specifies the rights and obligations of the people (including shareholders, officers and employees) who are associated with a corporation in one way or another. When rights, whether constitutional or statutory, are extended to corporations, the purpose is to protect the rights of these people.”

Justice Ruth Bader Ginsburg penned the dissenting opinion, arguing that the decision will “open the floodgates” for companies to challenge any law they don’t wish to follow on religious grounds. “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 (saving only tax laws) they judge incompatible with their sincerely held religious beliefs,” she wrote. “Compelling governmental interests in uniform compliance with the law, and disadvantages that religion-based opt-outs impose on others, hold no sway, the Court decides, at least when there is a ‘less restrictive alternative.’ And such an alternative, the Court suggests, there always will be whenever, in lieu of tolling an enterprise claiming a religion-based exemption, the government, i.e., the general public, can pick up the tab.”

Bader Ginsburg also argued that the Supreme Court decision violated the freedom of Hobby Lobby’s employees. As a public, for-profit company, she argues, they cannot require employees to follow their religious belief system or discuss their own. Faith-based organizations, including many nonprofits, can; and they have always had the right to opt out of contraceptive coverage.

“The exemption sought by Hobby Lobby and Conestoga would override significant interests of the corporations’ employees and covered dependents,” she wrote. “It would deny legions of women who do not hold their employers’ beliefs access to contraceptive coverage that the ACA would otherwise secure. See Catholic Charities of Sacramento Inc. v. Superior Court … (‘We are unaware of any decision in which . . . [the U. S. Supreme Court] has exempted a religious objector from the operation of a neutral, generally applicable law despite the recognition that the requested exemption would detrimentally affect the rights of third parties.’) In sum, with respect to free exercise claims, no less than free speech claims, ‘[y]our right to swing your arms ends just where the other man’s nose begins.’”

The Impact on Dealers
The ACA provision applies to businesses that employ 50 or more people. The language in the Hobby Lobby decision restricts the exemption to “closely held” companies; however, the ruling affects everyone, not just the few business owners who led the opposition.

Reed’s operation includes 175 employees, 65 of whom are on his company’s health plan, along with their spouses and families. He says he made the decision to file for an injunction after conferring with his immediate family, not knowing whether the rest of his organization would support it. He was pleasantly surprised by the feedback he got from employees as well as his community. “Even the ladies on our staff have been very supportive, and there have been no issues with it,” he says. “I didn’t know if there would be any opposition, but I felt like we needed to take a stand on principal, regardless of what it would do businesswise.”

Ultimately, Reed says, the government should not have the right to force business owners to choose between the law and their religious beliefs. “It has always been, from a morality standpoint, that the laws would allow people to act in an immoral way; but that’s part of a free country,” he says. “There had never been a law that required us to act in an immoral way, however. And in this case, Christian faith dictates that we be pro-life. We had never been forced to take a stance against that before.”

Reed notes that the medications in question can typically be purchased without a prescription at most pharmacies, often for as little as $5 per dose. He says he is not attempting to deny his employees access to the medication; he just does not feel that his company should have to pay for it.

Back to Business

The ruling opens the door to permanently having the contraceptive coverage removed. Reed is working with the insurance company in an attempt to define a narrow exclusion that would cover only the items to which he objects. It could be several months before any firm decisions can be made. For the moment, every dealer who falls under the ACA rules now has a choice: Provide the coverage already in place or call the insurance company and discuss alternatives.

In Kansas City, Reed has seen his business continue to grow in the wake of publicity generated by his opposition to the ACA provision. While he doesn’t attribute any appreciable gains or losses to this issue and his stance on it, he did note that one in-market couple drove in from another town after they heard what Reed was doing.

“When news hit in the area, I had probably 100 phone calls, maybe more. And all but one or two were very positive and supportive,” he says. “We found it was not just the people who support us from a moral standpoint, either, but also people who support us from the standpoint of the government trying to make us do things that violate our conscience, whether they agreed with our opinion or not.”

Toni McQuilken is a freelance writer with expertise in automotive retail, F&I and agency operations. [email protected]

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