The Patient Protection and Affordable Care Act (PPACA) requires non-grandfathered group health plans to provide coverage for certain preventive services on a first dollar basis (i.e. without deductibles, co-payments, co-insurance or other cost-sharing).  Interim final regulations provide an exemption for a very narrow subset of religious employers with respect to coverage of contraceptive services.  To qualify for the exemption the entity must be a nonprofit religious employer that offers insurance to its employees.  Many entities affiliated with religious institutions, such as hospitals and universities, do not meet this narrow exception.

Now, the U.S. Department of Health and Human Services (HHS) has provided additional guidance for nonprofit employers that do not cover contraceptive services under their current plans because of religious beliefs and that do not fit within the previous exemption.  These employers will have an additional year, until August 1, 2013, to comply with the new law.  Employers wishing to take advantage of the additional year will have to certify that they are eligible for this delayed implementation.  The announcement also indicates that employers that do not offer coverage of contraceptive services will be required to provide notice to employees stating that such services are available with income-based support at sites such as community health centers, public clinics and hospitals.