Hobby Lobby Stores, Inc. will shift the beginning of its employee health plan to temporarily stave off potentially millions of dollars in fines while its legal challenge to a federal mandate on emergency contraceptives proceeds.
The shift will allow Hobby Lobby to dodge penalties for several months that are part of the Affordable Care Act, the company said Thursday. The health care law requires the company to cover the cost of the emergency contraceptives for its employees or face up to $1.3 million in fines each day it fails to comply with the law, beginning at the inception of their insurance plan year.
A representative for Hobby Lobby declined to elaborate on how long the company will have before its new plan year will start — when the federal mandate on emergency contraceptives coverage would kick in.
“Hobby Lobby does not provide coverage for abortion-inducing drugs in its health care plan,” corporate general counsel Peter Dobelbower said in a statement.
“Hobby Lobby will continue to vigorously defend its religious liberty and oppose the mandate and any penalties,” he said.
Company founder and CEO David Green and his family consider some types of emergency contraceptives, including the morning-after and week-after pill, a type of abortion.
Covering the contraceptives through the company's employee health plan would conflict with the Green family's constitutionally protected religious beliefs, attorneys for the company have argued.
The federal government contends that religious freedoms don't apply to the company, because it is a secular, for-profit corporation.
On Dec. 26, U.S. Supreme Court Justice Sonia Sotomayor blocked Hobby Lobby's emergency request for an injunction to protect the company from federal fines while its court case proceeds.
Case is pending
The company has since said that it would incur the hefty fines rather than provide insurance coverage for the contraceptive pills. Hobby Lobby's court case is now pending at the U.S. 10th Circuit Court of Appeals.
On Monday, attorneys for the U.S. Department of Health and Human Services filed a motion to have Hobby Lobby's case heard on the same day by the same panel of judges as that of a Colorado heating and ventilation company that filed a similar challenge to the health care mandate.
Hearing the cases together would save time and expense, and ensure consistent rulings, the federal government's attorneys argued in the motion.
Both Hobby Lobby and the Colorado company, Hercules Industries Inc., are expected to challenge the federal government's request, according to court documents.
“We have been advised by the plaintiffs in both cases that they will oppose this motion,” the federal attorneys said in the filing. “It is difficult to understand, however, how they could claim prejudice from an order that would assign related cases to the same panel.”
Hobby Lobby does not provide coverage for abortion-inducing drugs in its health care plan. Hobby Lobby will continue to vigorously defend its religious liberty and oppose the mandate and any penalties.”
Corporate general counsel