Supreme Court Says Closely-Held Companies Don't Have To Provide Contraception

The Supreme Court on Monday dealt a setback to the Affordable Care Act, ruling that employers with religious objections can refuse to pay for contraception.

In a 5-4 decision handed down by conservative justice Samuel Alito, the court sided with arts and crafts chain Hobby Lobby over the federal government. The decision could lead to other challenges from for-profit corporations who seek to refuse coverage for other medical procedures at odds with religious beliefs.

The rule at stake under the health-care overhaul is a provision in the Affordable Care Act that requires all new health insurance plans to pay for contraceptives. The issue is whether for-profit corporations - in this case, the lead plaintiff Hobby Lobby Inc. - can refuse to provide all or some contraceptive services on the grounds they are owned by religious families.

Both Hobby Lobby, an arts and crafts chain, and Conestoga Wood Specialties, which makes wood cabinets, challenged that the birth-control mandate was unconstitutional because it violates the Religious Freedom Restoration Act. They said the requirement to cover contraceptives like Plan B and ella violates their religious liberty, since they equate use of the drugs to abortion.

Amid high-profile controversy two years ago, the Obama administration crafted exemptions for religious-affiliated organizations and other nonprofits. At issue was whether a for-profit corporation has religious rights under the Constitution, furthering the debate over so-called corporate personhood.

In addition to whether for-profit corporations could claim religious exemptions, the Supreme Court also wrestled with two other questions: Does the birth-control mandate of the ACA "substantially burden" the exercise of religion? And if it does, does the government have a compelling interest to do so?

Some of the liberal-leaning justices worried during oral arguments in March that a favorable ruling for Hobby Lobby could lead to more challenges of the law, including provisions that cover blood transfusions or vaccinations.

This is the most significant Obamacare-related case argued before the Supreme Court since the high court upheld the law's individual insurance mandate two years ago, in the heat of the 2012 presidential election. In that decision, Chief Justice John Roberts cast the deciding vote to preserve the heart of the law and the way for which it is paid.

This is a breaking news story. More to come...