CMS-9940-P 1 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 54 

[REG 129786-14] 

RIN 1545-BM39 

DEPARTMENT OF LABOR

Employee Benefits Security Administration

29 CFR Part 2590 

RIN 1210-AB67

DEPARTMENT OF HEALTH AND HUMAN SERVICES 

45 CFR Part 147 

[CMS-9940-P] 

RIN 0938-AS50 

Coverage of Certain Preventive Services Under the Affordable Care Act 

AGENCIES: Internal Revenue Service, Department of the Treasury; Employee Benefits 

Security Administration, Department of Labor; Centers for Medicare & Medicaid Services, 

Department of Health and Human Services. 

ACTION: Proposed rules. 

SUMMARY: This document proposes a change to the definition of an eligible organization that 

can avail itself of an accommodation with respect to coverage of certain preventive services 

under section 2713 of the Public Health Service Act (PHS Act), added by the Patient Protection 

and Affordable Care Act, as amended, and incorporated into the Employee Retirement Income 

Security Act of 1974 and the Internal Revenue Code. 
CMS-9940-P 2 

 Section 2713 of the PHS Act requires coverage without cost sharing of certain preventive 

health services by non-grandfathered group health plans and health insurance coverage. Among 

these services are women’s preventive health services, as specified in guidelines supported by 

the Health Resources and Services Administration (HRSA). As authorized by the current 

regulations, and consistent with the HRSA Guidelines, group health plans established or 

maintained by certain religious employers (and group health insurance coverage provided in 

connection with such plans) are exempt from the otherwise applicable requirement to cover 

certain contraceptive services. Additionally, under current regulations, accommodations are 

available with respect to the contraceptive coverage requirement for group health plans 

established or maintained by eligible organizations (and group health insurance coverage 

provided in connection with such plans), and student health insurance coverage arranged by 

eligible organizations that are institutions of higher education, that effectively exempt them from 

this requirement. The regulations establish a mechanism for separately furnishing payments for 

contraceptive services on behalf of participants and beneficiaries of the group health plans of 

eligible organizations that avail themselves of an accommodation, and enrollees and dependents 

of student health insurance coverage arranged by eligible organizations that are institutions of 

higher education that avail themselves of an accommodation. 

 These rules propose and seek comments on potential changes to the definition of “eligible 

organization” in the Departments’ regulations in light of the Supreme Court’s decision in 

Burwell v. Hobby Lobby Stores, Inc., 134 S. Ct. 2751 (2014), to ensure that participants and 

beneficiaries in group health plans (and enrollees and dependents in student health insurance 

coverage arranged by institutions of higher education) obtain, without additional cost, coverage 

of the full range of Food and Drug Administration (FDA) approved contraceptive services, as 
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CMS-9940-P 4 

3. By express or overnight mail. You may send written comments to the following 

address ONLY: 

 Centers for Medicare & Medicaid Services, 

 Department of Health and Human Services, 

 Attention: CMS-9940-P, 

 Mail Stop C4-26-05, 

 7500 Security Boulevard, 

Baltimore, MD 21244-1850. 

4. By hand or courier. Alternatively, you may deliver (by hand or courier) your 

written comments ONLY to any of the following addresses prior to the close of the comment 

period: 

a. For delivery in Washington, DC-- 

 Centers for Medicare & Medicaid Services, 

Department of Health and Human Services, 

Room 445-G, Hubert H. Humphrey Building, 

 200 Independence Avenue, SW., 

 Washington, DC 20201 

(Because access to the interior of the Hubert H. Humphrey Building is not readily 

available to persons without Federal government identification, commenters are encouraged to 

leave their comments in the CMS drop slots located in the main lobby of the building. A 

stamp-in clock is available for persons wishing to retain a proof of filing by stamping in and 

retaining an extra copy of the comments being filed.) 
CMS-9940-P 5 

b. For delivery in Baltimore, MD-- 

 Centers for Medicare & Medicaid Services, 

Department of Health and Human Services, 

7500 Security Boulevard, 

Baltimore, MD 21244-1850. 

If you intend to deliver your comments to the Baltimore address, call telephone number 

(410) 786-9994 in advance to schedule your arrival with one of our staff members. 

 Comments erroneously mailed to an address indicated as appropriate for hand or courier 

delivery may be delayed and received after the close of the comment period. 

For information on viewing public comments, see the beginning of the 

"SUPPLEMENTARY INFORMATION" section. 

FOR FURTHER INFORMATION CONTACT: 

David Mlawsky, Centers for Medicare & Medicaid Services (CMS), Department of Health and 

Human Services (HHS), at (410) 786-1565; Amy Turner or Beth Baum, Employee Benefits 

Security Administration (EBSA), Department of Labor, at (202) 693-8335; Karen Levin, Internal 

Revenue Service (IRS), Department of the Treasury, at (202) 927-9639. 

Customer Service Information: Individuals interested in obtaining information from the 

Department of Labor concerning employment-based health coverage laws may call the EBSA 

Toll-Free Hotline at 1-866-444-EBSA (3272) or visit the Department of Labor’s web site 

(www.dol.gov/ebsa). Information from HHS on private health insurance coverage can be found 

on CMS’s web site (www.cms.gov/cciio), and information on health care reform can be found at 

www.HealthCare.gov. 

SUPPLEMENTARY INFORMATION: 
CMS-9940-P 6 

Inspection of Public Comments: All comments received before the close of the comment period 

will be available for viewing by the public, including any personally identifiable or confidential 

business information that is included in a comment. We post all comments received before the 

close of the comment period on the following Web site as soon as possible after they have been 

received: http://www.regulations.gov. Follow the search instructions on that Web site to view 

public comments. 

 Comments received timely will also be available for public inspection as they are 

received, generally beginning approximately 3 weeks after publication of a document, at the 

headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 

Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. 

To schedule an appointment to view public comments, phone 1-800-743-3951. 

I. Background 

The Patient Protection and Affordable Care Act (Pub. L. 111–148) was enacted on 

March 23, 2010. The Health Care and Education Reconciliation Act of 2010 (Pub. L. 111–152) 

was enacted on March 30, 2010. These statutes are collectively known as the Affordable Care 

Act. The Affordable Care Act reorganizes, amends, and adds to the provisions of part A of title 

XXVII of the Public Health Service Act (PHS Act) relating to group health plans and health 

insurance issuers in the group and individual markets. The Affordable Care Act adds section 

715(a)(1) to the Employee Retirement Income Security Act of 1974 (ERISA) and section 

9815(a)(1) to the Internal Revenue Code (Code) to incorporate the provisions of part A of title 

XXVII of the PHS Act into ERISA and the Code, and to make them applicable to group health 

plans and health insurance issuers providing health insurance coverage in connection with group 
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health plans. The sections of the PHS Act incorporated into ERISA and the Code are sections 

2701 through 2728. 

Section 2713 of the PHS Act, as added by the Affordable Care Act and incorporated into 

ERISA and the Code, requires that non-grandfathered group health plans and health insurance 

issuers offering non-grandfathered group or individual health insurance coverage provide 

coverage of certain specified preventive services without cost sharing, including under paragraph 

(a)(4), benefits for certain women’s preventive health services as provided for in comprehensive 

guidelines supported by the Health Resources and Services Administration (HRSA). On August 

1, 2011, HRSA adopted and released guidelines for women’s preventive health services 

(HRSA Guidelines) based on recommendations of the independent Institute of Medicine. As 

relevant here, the HRSA Guidelines include all Food and Drug Administration (FDA)-approved 

contraceptives, sterilization procedures, and patient education and counseling for women with 

reproductive capacity, as prescribed by a health care provider (collectively, contraceptive 

services).1

 Except as discussed later in this section, non-grandfathered group health plans and 

health insurance coverage are required to provide coverage consistent with the HRSA 

Guidelines, without cost sharing, for plan years (or, in the individual market, policy years) 

beginning on or after August 1, 2012.2

Interim final regulations implementing section 2713 of the PHS Act were published on 

July 19, 2010 (75 FR 41726) (2010 interim final regulations). On August 1, 2011, the 

Departments of Health and Human Services (HHS), Labor, and the Treasury (collectively, the 

 

1

 The HRSA Guidelines for Women’s Preventive Services do not include services relating to a man’s reproductive 

capacity, such as vasectomies and condoms. 

2

 Interim final regulations published by the Departments on July 19, 2010, generally provide that plans and issuers 

must cover a newly recommended preventive service starting with the first plan year (or, in the individual market, 

policy year) that begins on or after the date that is one year after the date on which the new recommendation is 

issued. 26 CFR 54.9815-2713T(b)(1); 29 CFR 2590.715-2713(b)(1); 45 CFR 147.130(b)(1). 
CMS-9940-P 8 

Departments) amended the 2010 interim final regulations to provide HRSA with authority to 

exempt group health plans established or maintained by certain religious employers (and group 

health insurance coverage provided in connection with such plans) from the requirement to cover 

contraceptive services consistent with the HRSA Guidelines (76 FR 46621) (2011 amended 

interim final regulations).3

 On the same date, HRSA exercised this authority in the HRSA 

Guidelines to exempt group health plans established or maintained by these religious employers 

(and group health insurance coverage provided in connection with such plans) from the HRSA 

Guidelines with respect to contraceptive services.4

 The 2011 amended interim final regulations 

specified that, for purposes of this exemption, a religious employer was one that: (1) has the 

inculcation of religious values as its purpose; (2) primarily employs persons who share its 

religious tenets; (3) primarily serves persons who share its religious tenets; and (4) is a nonprofit 

organization described in section 6033(a)(1) and (a)(3)(A)(i) or (iii) of the Code. Section 

6033(a)(3)(A)(i) and (iii) of the Code refers to churches, their integrated auxiliaries, and 

conventions or associations of churches, as well as to the exclusively religious activities of any 

religious order. Final regulations issued on February 10, 2012, adopted the definition of 

religious employer in the 2011 amended interim final regulations without modification (2012 

final regulations).5

 

Contemporaneous with the issuance of the 2012 final regulations, HHS, with the 

agreement of the Departments of Labor and the Treasury, issued guidance establishing a 

temporary safe harbor from enforcement of the contraceptive coverage requirement by the 

 

3

 The 2011 amended interim final regulations were issued and effective on August 1, 2011, and published in the 

Federal Register on August 3, 2011 (76 FR 46621). 

4

 HRSA subsequently amended the HRSA Guidelines to reflect the simplified definition of “religious employer” 

contained in the July 2013 final regulations. 78 FR 39870 (July 2, 2013) (discussed below), effective August 1, 

2013. 

5

 The 2012 final regulations were published in the Federal Register on February 15, 2012 (77 FR 8725). 
CMS-9940-P 9 

Departments for group health plans established or maintained by certain nonprofit organizations 

with religious objections to contraceptive coverage (and group health insurance coverage 

provided in connection with such plans).6

 The guidance provided that the temporary 

enforcement safe harbor would remain in effect until the first plan year beginning on or after 

August 1, 2013. At the same time, the Departments committed to rulemaking to achieve the 

goals of providing coverage of recommended preventive services, including contraceptive 

services, without cost sharing, while simultaneously ensuring that certain additional nonprofit 

organizations with religious objections to contraceptive coverage would not have to contract, 

arrange, pay, or refer for such coverage. 

On March 21, 2012, the Departments published an advance notice of proposed 

rulemaking (ANPRM) that described and solicited comments on possible approaches to achieve 

these goals (77 FR 16501). 

On February 6, 2013, following review of the comments on the ANPRM, the 

Departments published proposed regulations at 78 FR 8456 (proposed regulations). The 

regulations proposed to simplify and clarify the definition of “religious employer” for purposes 

of the religious employer exemption. The regulations also proposed accommodations for group 

 

6

 Guidance on the Temporary Enforcement Safe Harbor for Certain Employers, Group Health Plans, and Group 

Health Insurance Issuers with Respect to the Requirement to Cover Contraceptive Services Without Cost Sharing 

Under Section 2713 of the Public Health Service Act, Section 715(a)(1) of the Employee Retirement Income 

Security Act, and Section 9815(a)(1) of the Internal Revenue Code (originally issued on February 10, 2012, and 

reissued on August 15, 2012 and June 28,2013), available at: 

http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/preventive-servicesguidance-6-28-2013.pdf. The guidance clarified, among other things, that plans that took some action before 

February 10, 2012, to try, without success, to exclude or limit contraceptive coverage were not precluded from 

eligibility for the safe harbor. The temporary enforcement safe harbor was also available to student health insurance 

coverage arranged by nonprofit institutions of higher education with religious objections to contraceptive coverage 

that met the conditions set forth in the guidance. See “Student Health Insurance Coverage,” 77 FR16457 (Mar. 21, 

2012). 
CMS-9940-P 10 

health plans established or maintained or arranged by certain nonprofit religious organizations 

with religious objections to contraceptive coverage (and group health insurance coverage 

provided in connection with such plans). These organizations were referred to as “eligible 

organizations.” 

 The regulations proposed that, in the case of an insured group health plan established or 

maintained by an eligible organization, the health insurance issuer providing group health 

insurance coverage in connection with the plan would be required to assume sole responsibility 

for providing contraceptive coverage to plan participants and beneficiaries without cost sharing, 

premium, fee, or other charge to plan participants or beneficiaries or to the eligible organization 

or its plan. The Departments proposed a comparable accommodation with respect to student 

health insurance coverage arranged by eligible organizations that are institutions of higher 

education. 

 In the case of a self-insured group health plan established or maintained by an eligible 

organization, the proposed regulations presented potential approaches under which the third 

party administrator of the plan would provide or arrange for a third party to provide 

contraceptive coverage to plan participants and beneficiaries without cost sharing, premium, fee, 

or other charge to plan participants or beneficiaries or to the eligible organization or its plan. An 

issuer (or its affiliate) would be able to offset the costs incurred by the third party administrator 

and the issuer in the course of arranging and providing such coverage by claiming an adjustment 

in the Federally-facilitated Exchange (FFE) user fee. 

The Departments received over 400,000 comments (many of them standardized form 

letters) in response to the proposed regulations. After consideration of the comments, the 

Departments published final regulations on July 2, 2013 at 78 FR 39870 (July 2013 final 
CMS-9940-P 11 

regulations). The July 2013 final regulations simplified and clarified the definition of religious 

employer for purposes of the religious employer exemption and established accommodations for 

health coverage established or maintained or arranged by eligible organizations. A 

contemporaneously re-issued HHS guidance document extended the temporary safe harbor from 

enforcement of the contraceptive coverage requirement by the Departments to encompass plan 

years beginning on or after August 1, 2013, and before January 1, 2014. This guidance included 

a form to be used by an organization during this temporary period to self-certify that its plan 

qualified for the temporary enforcement safe harbor. In addition, HHS and the Department of 

Labor (DOL) issued a self-certification form, EBSA Form 700, to be executed by an 

organization seeking to be treated as an eligible organization for purposes of an accommodation 

under the July 2013 final regulations. This self-certification form was provided for use with the 

accommodation under the July 2013 final regulations, after the expiration of the temporary 

enforcement safe harbor (that is, for plan years beginning on or after January 1, 2014). 

On June 30, 2014, the Supreme Court ruled in the case of Burwell v. Hobby Lobby 

Stores, Inc. that, under the Religious Freedom Restoration Act of 1993 (RFRA), the requirement 

to provide contraceptive coverage could not be applied to the closely held for-profit corporations 

before the Court because their owners had religious objections to providing such coverage, and 

because the Government’s goal of guaranteeing coverage for contraceptive methods without cost 

sharing could be achieved in a less restrictive manner by offering such closely held for-profit 

entities the accommodation the Government already provided to religious nonprofit 

organizations with religious objections to contraceptive coverage. After describing this 

accommodation, the Court concluded that the accommodation “does not impinge on the 
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plaintiffs’ religious belief that providing insurance coverage for the contraceptives at issue here 

violates their religion, and it serves HHS’ stated interests equally well.” 

On July 3, 2014, the Supreme Court issued an interim order in connection with an 

application for an injunction pending appeal in Wheaton College v. Burwell, 134 S. Ct. 2806 

(2014) (the Wheaton order), in which Wheaton College challenged under RFRA the requirement 

in the July 2013 final regulations that an eligible organization invoking the accommodation send 

EBSA Form 700 to the insurance issuer or third party administrator. The Court’s order stated 

that, “[i]f [Wheaton College] informs the Secretary of Health and Human Services in writing that 

it is a nonprofit organization that holds itself out as religious and has religious objections to 

providing coverage for contraceptive services, the [Departments of Labor, Health and Human 

Services, and the Treasury] are enjoined from enforcing against [Wheaton College]” certain 

provisions of the Affordable Care Act and related regulations requiring coverage without cost 

sharing of certain contraceptive services “pending final disposition of appellate review.” 

134 S. Ct. at 2807. The order stated that Wheaton College need not use EBSA Form 700 or send 

a copy of the executed form to its health insurance issuers or third party administrators to meet 

the condition for this injunctive relief. Id. The Court also stated that its interim order neither 

affected “the ability of [Wheaton College’s] employees and students to obtain, without cost, the 

full range of FDA approved contraceptives,” nor precluded the Government from relying on the 

notice by Wheaton College “to facilitate the provision of full contraceptive coverage under the 

Act.” Id. The Court’s order further stated that it “should not be construed as an expression of 

the Court’s views on the merits” of Wheaton College’s challenge to the accommodations. Id. 

This notice of proposed rulemaking proposes and invites comments on changes to the 

definition of an eligible organization in the Departments’ regulations in light of the Supreme 
CMS-9940-P 13 

Court’s decision in Hobby Lobby. It also solicits comments on any other steps the Government 

should take to help ensure that participants and beneficiaries in group health plans or enrollees 

and dependents in student health insurance coverage arranged by institutions of higher education 

are able to obtain, without cost, the full range of FDA-approved contraceptives, as prescribed by 

a health care provider, without cost sharing, if enrolled in a group health plan or insurance 

coverage sponsored or arranged by a closely held for-profit entity that objects on religious 

grounds to covering contraceptive services. Given the importance of this coverage, initiating this 

proposed rulemaking now allows for public input and a pathway toward helping to ensure access 

to contraceptive coverage. 

The Departments are publishing contemporaneously with this notice of proposed 

rulemaking interim final regulations in light of the Supreme Court’s interim order in connection 

with the application for an injunction in the pending case of Wheaton College v. Burwell. The 

interim final regulations are published elsewhere in this edition of the Federal Register. 

II. Provisions of the Proposed Regulations 

As stated above, on June 30, 2014, the Supreme Court ruled in Burwell v. Hobby Lobby 

Stores, Inc. that, under RFRA, the requirement to provide contraceptive coverage could not be 

applied to certain closely held for-profit organizations. The individual plaintiffs in Hobby Lobby 

and the associated case Conestoga Wood Specialties Corp. v. Burwell run closely held 

businesses that are family-owned and operated and that have adopted statements of mission or 

purpose to conduct the companies’ affairs in accordance with the owners’ shared religious 

beliefs and values. See134 S. Ct. at 2764-2766. 

 In light of the Court’s decision in Hobby Lobby, the Departments propose to amend the 

definition of an eligible organization under the July 2013 final regulations to include a closely 
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held for-profit entity that has a religious objection to providing coverage for some or all of the 

contraceptive services otherwise required to be covered. Under these proposed rules, a 

qualifying closely held for-profit entity that has a religious objection to providing coverage for 

some or all of the contraceptive services otherwise required to be covered would not be required 

to contract, arrange, pay or refer for contraceptive coverage; instead, payments for contraceptive 

services provided to participants and beneficiaries in the eligible organization’s plan would be 

provided separately by an issuer (if the qualifying entity sponsors an insured group health plan, 

or if the qualifying entity is an institution of higher education that arranges student health 

insurance coverage) or arranged separately by a third party administrator (if the qualifying entity 

is self-insured), consistent with the July 2013 final regulations as amended by interim final 

regulations published in this same edition of the Federal Register. This proposed change would 

extend to participants and beneficiaries in group health plans established or maintained by 

certain closely held for-profit entities with religious objections to contraceptive coverage, and to 

enrollees and dependents enrolled in student health insurance coverage arranged by certain 

closely held for-profit entities that are institutions of higher education with religious objections 

to contraceptive coverage, the same, separate payments for contraceptive services provided to 

participants and beneficiaries of group health plans (and enrollees and dependents in student 

health insurance) established or maintained by certain nonprofit religious entities with such 

objections, while similarly respecting the religious objections of the closely held for-profit 

entities. 

Defining a Closely Held For-Profit Entity 

In considering inclusion of certain closely held for-profit entities among the eligible 

organizations that may avail themselves of the accommodations, the Departments are 
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considering and seek comment on how to define a qualifying closely held for-profit entity. In 

Hobby Lobby, the Supreme Court noted that the companies at issue in the cases were not 

publicly traded and were owned and controlled by members of a single family and that the 

companies were operated in accordance with the owners’ shared religious beliefs and values. 

134 S. Ct. at 2764-2766. 

In light of the Supreme Court’s decision, the Departments are proposing for comment 

two possible approaches to defining a qualifying closely held for-profit entity, although the 

Departments invite comments on other approaches as well. In common understanding, a closely 

held corporation – a term often used interchangeably with a “close” or “closed” corporation – is 

a corporation the stock of which is owned by a small number of persons and for which no active 

trading market exists. See, for example, American Law Institute, Principles of Corporate 

Governances section 1.06; Black’s Law Dictionary (9th ed. 2009) (“close corporation”); Del. 

Code Tit. 8, Ch.1, Sub. Ch. 14 (“close corporation”). The examples below are by way of 

illustration, and the maximum number of shareholders specified in particular examples would 

not necessarily be borrowed as the standard in this context. 

Under the first proposed approach, a qualifying closely held for-profit entity would be an 

entity where none of the ownership interests in the entity is publicly traded and where the entity 

has fewer than a specified number of shareholders or owners. 

There is precedent in other areas of federal law for limiting the definition of closely held 

entities in this context to those with a relatively small number of owners. For example, 

subchapter S treatment under section 1361 of the Code is currently limited to corporations with 

100 or fewer shareholders who are generally individuals and has in the past been limited to 
CMS-9940-P 16 

corporations with 10 or fewer shareholders. Similarly, certain favorable estate tax treatment is 

limited to businesses with 45 or fewer partners or shareholders under section 6166 of the Code. 

Under a second, alternative approach, a qualifying closely held entity would be a forprofit entity in which the ownership interests are not publicly traded, and in which a specified 

fraction of the ownership interest is concentrated in a limited and specified number of owners. 

This approach also has precedent in federal law. For example, certain rules governing the 

taxation of real estate investment trusts, passive activity losses, and certain income from foreign 

entities are limited to organizations that are more than 50 percent owned by or for not more than 

five individuals. See, for example, sections 856(h), 542(a)(2), and 469(j)(1) of the Code and 

regulations under these sections. 

These approaches might serve to identify for-profit entities controlled and operated by 

individual owners who likely have associational ties, are personally identified with the entity, 

and can be regarded as conducting personal business affairs through the entity. These appear to 

be the types of entities the Court sought to accommodate in Hobby Lobby. There may also be 

useful definitions or principles in state laws governing close corporations, or other areas of law. 

The Departments invite comments on the appropriate scope of the definition of a 

qualifying closely held for-profit entity, including but not limited to whether a closely held forprofit entity should be defined with reference to a maximum number of owners (and, if so, what 

that maximum number should be) or a minimum concentration of ownership (and if so, what that 

concentration should be) or with reference to additional or other criteria. 

 It would be helpful for comments to address how the selection of a particular approach 

can be informed by the purposes of the Affordable Care Act and the contraceptive coverage 

requirement; the range of business structures in the Nation’s economy; background principles of 
CMS-9940-P 17 

federal and state law applicable to business entities and the relationship of the entities’ owners to 

the entities; other related or analogous areas of the law; experience regarding accommodations of 

religion and religious beliefs in various contexts and the rationales for the scope and operation of 

such accommodations; Hobby Lobby and other court decisions that shed light on these issues; 

and any other relevant matters. 

Religious Objection to Providing Coverage for Some or All of the Contraceptive Services 

Required to be Covered. 

In Hobby Lobby, the Supreme Court held that the closely held for-profit corporations at 

issue in that case could opt not to provide otherwise required contraceptive coverage if doing so 

runs counter to their owners’ sincerely held religious beliefs. These proposed regulations would 

require that the qualifying closely held for-profit entity’s objection, based on its owners’ 

sincerely held religious beliefs, to covering some or all of the contraceptive services otherwise 

required to be covered, be made in accordance with the entity’s applicable rules of governance. 

As discussed by the Court in Hobby Lobby, state corporate law dictates how a corporation may 

establish its governing structure.7 

Under the Departments’ proposal, valid corporate action (or similar action by a business 

that is not organized as a corporation) taken in accordance with the entity’s governing structure 

in accordance with state law, stating its owners’ religious objection to providing some or all 

contraceptive coverage otherwise required to be provided, can serve to establish that a closely 

held for-profit entity has religious objections to providing such coverage. In determining 

whether a closely held for-profit entity’s decision-making process followed the necessary rules 

and procedures, the laws of the state in which the entity is incorporated, or, for non-corporate 

 

7

 134 S. Ct. at 2774-2775. 
CMS-9940-P 18 

entities, organized, would govern. The Departments invite comments on whether to require 

documentation of the decision-making process and disclosure of the decision. 

The Departments seek comment on this approach to determining that a closely held forprofit entity opposes providing coverage for some or all of the contraceptive services otherwise 

required to be covered on account of the owners’ religious objections. 

Other Potential Changes 

The Departments seek comment on other potential changes to the July 2013 final 

regulations in light of the proposed change to the definition of eligible organization. In 

particular, the Departments seek comment on applying the approach set forth in the July 2013 

final regulations in the context of the expanded definition of eligible organization. The July 

2013 final regulations provide for separate payments for contraceptive services for participants 

and beneficiaries in self-insured group health plans of eligible organizations in a manner that 

enables these organizations to completely separate themselves from administration and payment 

for contraceptive coverage. Specifically, the third party administrator must provide or arrange 

such payments, and can seek reimbursement for such costs (including an allowance for 

administrative costs and margin) by making an arrangement with a participating issuer – that is, 

an issuer offering coverage through a Federally-facilitated Exchange (FFE). The participating 

issuer can receive an adjustment to its FFE user fees to finance such costs. 

The Departments seek comment on the likely number of closely held for-profit entities 

that would seek an accommodation, the number of participants and beneficiaries (or in the case 

of student health insurance coverage, enrollees and dependents) in the plans of such entities, and 

the number of issuers and third-party administrators affected by the proposed rules. Finally, the 

Departments seek comment on whether any other aspects of the accommodations in the July 
CMS-9940-P 19 

2013 final regulations, including relevant definitions, should be modified in light of the proposed 

addition of closely held for-profit entities with religious objections to contraceptive coverage to 

the definition of eligible organization. 

These proposed regulations, if finalized as proposed, would require a small number of 

conforming changes to cross-references in the regulations. Any such necessary conforming 

changes would be incorporated into final regulations. 

III. Response to Comments 

Because of the large number of public comments we normally receive on Federal 

Register documents, we are not able to acknowledge or respond to them individually. The 

Departments will consider all comments we receive by the date and time specified in the 

"DATES" section of this preamble, and, when we proceed with a subsequent document, we will 

respond to the comments in the preamble to that document.

IV. Economic Impact and Paperwork Burden 

A. Executive Orders 12866 and 13563 – Department of Health and Human Services and 

Department of Labor 

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of 

available regulatory alternatives and, if regulation is necessary, to select regulatory approaches 

that maximize net benefits (including potential economic, environmental, and public health and 

safety effects; distributive impacts; and equity). Executive Order 13563 emphasizes the 

importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and 

promoting flexibility. 

Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an 

action that is likely to result in a regulation: (1) having an annual effect on the economy of 
CMS-9940-P 20 

$100 million or more in any 1 year, or adversely and materially affecting a sector of the 

economy, productivity, competition, jobs, the environment, public health or safety, or state, 

local, or tribal governments or communities (also referred to as “economically significant”); 

(2) creating a serious inconsistency or otherwise interfering with an action taken or planned by 

another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or 

loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or 

policy issues arising out of legal mandates, the President’s priorities, or the principles set forth in 

the Executive Order. 

A regulatory impact analysis must be prepared for major rules with economically 

significant effects ($100 million or more in any 1 year), and an “economically significant” 

regulatory action is subject to review by the Office of Management and Budget (OMB). The 

Departments anticipate that these proposed regulations are not likely to have economic impacts 

of $100 million or more in any 1 year, and therefore, do not meet the definition of “economically 

significant” under Executive Order 12866. 

1. Need for Regulatory Action 

The proposed rules would modify the July 2013 final regulations in light of the Supreme 

Court’s decision in Hobby Lobby. That decision held that a closely held for-profit corporation is 

exempt from the requirement to provide contraceptive coverage if its owners have religious 

objections to such coverage, because there is a less restrictive means of furthering the law’s 

interests, namely the accommodation the Government already provided to nonprofit religious 

organizations with such objections. Contraceptive coverage is crucial to women’s health and 

equality for a number of reasons, including but not limited to the psychological toll and 

compromised financial position, and adverse health consequences, that can result from 
CMS-9940-P 21 

unplanned or unwanted pregnancies. As documented in a report of the Institute of Medicine, 

women experiencing an unintended pregnancy may not immediately be aware that they are 

pregnant, and thus delay prenatal care. They also may not be as motivated to discontinue 

behaviors that pose pregnancy-related risks (for example, smoking, consumption of alcohol).8

Studies show a greater risk of preterm birth and low birth weight among unintended pregnancies 

compared with pregnancies that were planned.9

 Contraceptives also have medical benefits for 

women who are contraindicated for pregnancy, and there are demonstrated preventive health 

benefits from contraceptives relating to conditions other than pregnancy.10 In addition, there are 

significant cost savings to employers from the coverage of contraceptives.11 Providing this 

coverage to participants and beneficiaries affected by the Supreme Court decision is a priority. 

2. Anticipated Effects 

 The Departments expect that these proposed regulations would not result in any 

additional significant burden on or costs to the affected entities. 

B. Special Analyses – Department of the Treasury 

For purposes of the Department of the Treasury, it has been determined that this proposed 

rule is not a significant regulatory action as defined in Executive Order 12866, as supplemented 

by Executive Order 13563. Therefore, a regulatory assessment is not required. It also has been 

determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not 

apply to this proposed rule. Pursuant to the Regulatory Flexibility Act (5 U.S.C. chapter 6), it is 

hereby certified that this proposed rule will not have a significant economic impact on a 

 

8

 Inst. Of Med., Clinical Preventive Services for Women: Closing the Gaps, Wash., D.C.: Nat’l Acad. Press, 2011, 

at p. 16. 

9

 Gipson, J.D. et al., The Effects of Unintended Pregnancy on Infant, Child and Parental Health: A Review of the 

Literature, Studies on Family Planning, 2008, 39(1):18-38. 10 Inst. Of Med., Clinical Preventive Services for Women: Closing the Gaps, Wash., D.C.: Nat’l Acad. Press, 2011, 

at p. 107. 

11 See discussion at 77 FR 8727. 
CMS-9940-P 22 

substantial number of small entities This certification is based on the fact that the regulations 

merely propose to modify the definition of eligible organization to include certain closely held 

for-profit entities. This modification, if adopted, would not increase costs to or burdens on the 

affected organizations. Pursuant to section 7805(f) of the Code, these regulations have been 

submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment 

on their impact on small business. 

C. Paperwork Reduction Act – Department of Health and Human Services 

 Under the Paperwork Reduction Act of 1995, we are required to provide 60-day notice in 

the Federal Register and solicit public comment before a collection of information requirement 

is submitted to the Office of Management and Budget (OMB) for review and approval. In order 

to fairly evaluate whether an information collection should be approved by OMB, section 

3506(c)(2)(A) of the Paperwork Reduction Act of 1995 requires that we solicit comment on the 

following issues: 

● The need for the information collection and its usefulness in carrying out the proper 

functions of our agency. 

● The accuracy of our estimate of the information collection burden. 

● The quality, utility, and clarity of the information to be collected. 

● Recommendations to minimize the information collection burden on the affected 

public, including automated collection techniques. 

We are soliciting public comment on each of these issues for the following sections of 

this document that contain information collection requirements (ICRs): 

The 2013 final regulations require an eligible organization that seeks an accommodation 

to self-certify that it meets the definition of an eligible organization using the EBSA Form 700 
CMS-9940-P 23 

and providing it directly to each third party administrator or issuer under the plan that would 

otherwise arrange for or provide the covered contraceptive services. The interim final 

regulations being published contemporaneously with these proposed regulations continue to 

allow such eligible organizations to use EBSA Form 700, as set forth in the 2013 final 

regulations and guidance. In addition, the interim final regulations permit an alternative process, 

consistent with the Supreme Court’s interim order in Wheaton College, under which an eligible 

organization may notify HHS in writing of its religious objection to coverage of all or a subset of 

contraceptive services. 

 These proposed regulations do not change the requirement that an eligible organization 

that seeks accommodation self-certifies that it meets the definition of an eligible organization, 

either using the EBSA Form 700 method of self-certification or the alternative notice to HHS 

process. 

 HHS is anticipating that 71 for-profit organizations will seek an accommodation. This is 

based on the number of plaintiffs that are for-profit employers in recent litigation objecting on 

religious grounds to the provision of contraceptive services. We seek comments on this estimate and 

welcome any data that may assist us in estimating the number of entities affected by this provision. 

For each eligible organization it is assumed that, clerical staff will gather and enter the necessary 

information, send the self-certification or the notice to its issuer(s) or third party administrator(s) 

or to HHS electronically and retain a copy for recordkeeping, a manager and legal counsel will 

review it, and a senior executive will execute it. It is estimated that an organization will need 

approximately 50 minutes (30 minutes of clerical labor at a cost of $30.00 per hour, 10 minutes 

for a manager at a cost of $102 per hour, 5 minutes for legal counsel at a cost of $127 per hour, 

and 5 minutes for a senior executive at a cost of $121 per hour) to execute the self-certification. 

The certification may be electronically transmitted to the issuer or to HHS at minimal cost, but a 
CMS-9940-P 24 

cost burden of $38.34 is estimated for a paper filing calculated with 5 cents per page printing and 

material costs and 49 cents postage costs. Therefore, the total one-time burden for preparing and 

providing the information in the self-certification is estimated to be approximately $53 for each 

eligible organization. 

Based on this estimate of 71 affected entities and the individual burden estimate of $53, 

we estimate the hour burden to be 59.2 hours with an equivalent cost of $3736 and a paper filing 

cost burden of $38.34. As the Department of Labor and the Department of Health and Human 

Services share jurisdiction they are splitting the hour burden so each will account for 29.6 burden 

hours and a cost burden of $19.17. We welcome comments on any aspect of this burden 

estimate. 

If you comment on these information collection and recordkeeping requirements, please 

submit your comments electronically as specified in the ADDRESSES section of this proposed 

rule. 

Comments must be received on/by [INSERT DATE 60 DAYS AFTER DATE OF 

PUBLICATION IN THE FEDERAL REGISTER]. 
CMS-9940-P 25 

D. Paperwork Reduction Act – Department of Labor 

As discussed above, the proposed regulations would revise the definition of eligible 

organization to include qualifying closely held for-profit entities. This action would amend the 

EBSA Form 700 information collection request (ICR), which is approved under OMB Control 

number 1210-NEW to allow qualified closely held for-profit entities to avail themselves of the 

accommodation by self-certifying that they meet the definition of an eligible organization, either 

using the EBSA Form 700 method of self-certification or the alternative notice to HHS process 

under the contemporaneous interim final regulations. 

• Consistent with the HHS analysis presented above, DOL estimates that there will be 

71 additional entities that would utilize the accommodation. The Departments are soliciting 

comments for 60 days regarding the likely number of additional entities seeking an 

accommodation, the number of participants and beneficiaries in the plans of such organizations, 

and the number of issuers and third party administrators impacted by the proposed regulations. 

The Departments will submit a copy of these proposed rules to OMB in accordance with 

44 U.S.C. 3507(d) for review of the proposed ICRs. The Departments and OMB are particularly 

interested in comments that: 

• Evaluate whether the collection of information is necessary for the proper performance of 

the functions of the agency, including whether the information will have practical utility; 

• Evaluate the accuracy of the agency’s estimate of the burden of the collection of 

information, including the validity of the methodology and assumptions used; 

• Enhance the quality, utility, and clarity of the information to be collected; and 

• Minimize the burden of the collection of information on those who are to respond, 

including through the use of appropriate automated, electronic, mechanical, or other 
CMS-9940-P 26 

technological collection techniques or other forms of information technology, for example, by 

permitting electronic submission of responses. 

Comments should be sent to the Office of Information and Regulatory Affairs, Attention: 

Desk Officer for the Employee Benefits Security Administration either by Fax to (202) 395-5806 

or by email to oira_submission@omb.eop.gov. A copy of the proposed ICRs may be obtained 

by contacting the PRA addressee: G. Christopher Cosby, Office of Policy and Research, 

Department of Labor, Employee Benefits Security Administration, 200 Constitution Avenue 

NW., Room N–5718, Washington, DC 20210; telephone: (202) 693–8410; Fax: (202) 219–4745 

(please note that these numbers are not toll-free numbers); email: ebsa.opr@dol.gov. Proposed 

ICRs submitted to OMB also are available at www.reginfo.gov 

(http://www.reginfo.gov/public/do/PRAMain). 

 The Departments expect that qualified closely held for-profit entities will spend the same 

time (and incur the same cost) to prepare and send the EBSA Form 700 or the notification to the 

Secretary of HHS as other eligible organizations under the existing ICR (approximately 50 

minutes in preparation time and $0.54 mailing costs). The Departments note that persons are not 

required to respond to, and generally are not subject to any penalty for failing to comply with, an 

ICR unless the ICR has a valid OMB control number. The paperwork burden estimates are 

summarized as follows: 

Type of Review: Revised Collection. 

Agencies: Employee Benefits Security Administration, Department of Labor 

Title: EBSA Form 700. 

OMB Number: 1210-NEW. 

Affected Public: Business or other for profit entity. 
CMS-9940-P 27 

Total Respondents: 71 

Total Responses: 71 

Frequency of Response: Once, Variable. 

Estimated Total Annual Burden Hours: 59 hours (DOL 29.5 hours, HHS 29.5 hours) 

Estimated Total Annual Burden Cost: $38 (DOL $19, HHS $19) 

V. Unfunded Mandates Reform Act 

 For purposes of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), as well as 

Executive Order 12875, these proposed regulations do not include any federal mandate that may 

result in expenditures by state, local, or tribal governments, nor do they include any federal 

mandates that may impose an annual burden of $100 million, adjusted for inflation, or more on 

the private sector.12

VI. Federalism – Department of Health and Human Services and Department of Labor 

Executive Order 13132 outlines fundamental principles of federalism, and requires the 

adherence to specific criteria by federal agencies in the process of their formulation and 

implementation of policies that have “substantial direct effects” on states, the relationship 

between the federal government and states, or the distribution of power and responsibilities 

among the various levels of government. Federal agencies promulgating regulations that have 

these federalism implications must consult with state and local officials, and describe the extent 

of their consultation and the nature of the concerns of state and local officials in the preamble to 

the regulation. 

In the Departments’ view, these proposed regulations have federalism implications, but 

the federalism implications are substantially mitigated because, with respect to health insurance 

 

12 In 2014, that threshold level is approximately $141 million. 
CMS-9940-P 28 

issuers, 45 states are either enforcing the requirements related to coverage of specified preventive 

services (including contraception) without cost sharing pursuant to state law or otherwise are 

working collaboratively with HHS to ensure that issuers meet these standards. In five states, 

HHS ensures that issuers comply with these requirements. Therefore, the proposed regulations 

are not likely to require substantial additional oversight of states by HHS. 

In general, section 514 of ERISA provides that state laws are superseded to the extent 

that they relate to any covered employee benefit plan, and preserves state laws that regulate 

insurance, banking, or securities. ERISA also prohibits states from regulating a covered plan as 

an insurance or investment company or bank. The Health Insurance Portability and 

Accountability Act of 1996 (HIPAA) added a new preemption provision to ERISA (as well as to 

the PHS Act) narrowly preempting state requirements on group health insurance coverage. 

States may continue to apply state law requirements but not to the extent that such requirements 

prevent the application of the federal requirement that group health insurance coverage provided 

in connection with certain group health plans provide coverage for specified preventive services 

without cost sharing. HIPAA’s Conference Report states that the conferees intended the 

narrowest preemption of state laws with regard to health insurance issuers (H.R. Conf. Rep. No. 

104-736, 104th Cong. 2d Session 205, 1996). State insurance laws that are more stringent than 

the federal requirement are unlikely to “prevent the application of” the preventive services 

coverage provision, and therefore are unlikely to be preempted. Accordingly, states have 

significant latitude to impose requirements on health insurance issuers that are more restrictive 

than those in federal law. 

Guidance conveying this interpretation was published in the Federal Register on 

April 8, 1997 (62 FR 16904) and December 30, 2004 (69 FR 78720), and these proposed 
CMS-9940-P 29 

regulations implement the preventive services coverage provision’s minimum standards and do 

not significantly reduce the discretion given to states under the statutory scheme. 

The PHS Act provides that states may enforce the provisions of title XXVII of the PHS 

Act as they pertain to issuers, but that the Secretary of HHS will enforce any provisions that a 

state does not have authority to enforce or that a state has failed to substantially enforce. When 

exercising its responsibility to enforce provisions of the PHS Act, HHS works cooperatively with 

the state to address the state’s concerns and avoid conflicts with the state’s exercise of its 

authority. HHS has developed procedures to implement its enforcement responsibilities, and to 

afford states the maximum opportunity to enforce the PHS Act’s requirements in the first 

instance. In compliance with Executive Order 13132’s requirement that agencies examine 

closely any policies that may have federalism implications or limit the policymaking discretion 

of states, the Departments have engaged in numerous efforts to consult and work cooperatively 

with affected state and local officials. 

In conclusion, throughout the process of developing these proposed regulations, to the 

extent feasible within the specific preemption provisions of ERISA and the PHS Act, the 

Departments have attempted to balance states’ interests in regulating health coverage and health 

insurance issuers, and the rights of those individuals intended to be protected in the PHS Act, 

ERISA, and the Code. 

VII. Statutory Authority

 The Department of the Treasury regulations are adopted pursuant to the authority 

contained in sections 7805 and 9833 of the Code. 

 The Department of Labor regulations are adopted pursuant to the authority contained in 

29 U.S.C. 1002(16), 1027, 1059, 1135, 1161–1168, 1169, 1181–1183, 1181 note, 1185, 1185a, 
CMS-9940-P 30 

1185b, 1185d, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Public Law 104–191, 110 Stat. 

1936; sec. 401(b), Public Law 105–200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Public 

Law 110–343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Public Law 111–148, 124 Stat. 119, 

as amended by Public Law 111–152, 124 Stat. 1029; Secretary of Labor’s Order 3-2010, 75 FR 

55354 (September 10, 2010). 

 The Department of Health and Human Services regulations are adopted pursuant to the 

authority contained in sections 2701 through 2763, 2791, and 2792 of the PHS Act (42 U.S.C. 

300gg through 300gg-63, 300gg-91, and 300gg-92), as amended; and Title I of the Affordable 

Care Act, sections 1301–1304, 1311–1312, 1321–1322, 1324, 1334, 1342–1343, 1401–1402, and 

1412, Pub. L. 111-148, 124 Stat. 119 (42 U.S.C. 18021–18024, 18031–18032, 18041–18042, 

18044, 18054, 18061, 18063, 18071, 18082, 26 U.S.C. 36B, and 31 U.S.C. 9701). 

Signed this 20th day of August 2014. 

 John Dalrymple 

 Deputy Commissioner for Services and Enforcement 

 Internal Revenue Service 

Signed this 20th day of August 2014. 

 

 ______________________________________ 

Phyllis C. Borzi, 

 Assistant Secretary, 

Employee Benefits Security Administration. 

Department of Labor. 

Dated: August 19, 2014. 
CMS-9940-P 31 

 ___________________________________ 

 Marilyn Tavenner, 

 Administrator, 

 Centers for Medicare & Medicaid Services. 

Approved: August 20, 2014. 

 ___________________________________ 

 Sylvia M. Burwell, 

 Secretary, 

 Department of Health and Human Services. 

[Billing Codes: 4830-01-P; 4510-029-P; 4120-01-P; 6325-64]

List of Subjects 

26 CFR Part 54 

Excise taxes, Health care, Health insurance, Pensions, Reporting and recordkeeping 

requirements. 

29 CFR Part 2590 

Continuation coverage, Disclosure, Employee benefit plans, Group health plans, Health 

care, Health insurance, Medical child support, Reporting and recordkeeping requirements. 

45 CFR Part 147 

Health care, Health insurance, Reporting and recordkeeping requirements, State 

regulation of health insurance.
CMS-9940-P 32 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

Accordingly, 26 CFR part 54 is proposed to be amended as follows: 

PART 54 – PENSION EXCISE TAXES 

 Paragraph 1. The authority citation for part 54 continues to read, in part, as follows:

 Authority: 26 U.S.C. 7805 * * *

 Par. 2. Section 54.9815-2713A is amended by revising paragraph (a) to read as follows: 

§54.9815-2713A Accommodations in connection with coverage of preventive health 

services. 

(a) Eligible organizations. An eligible organization is an organization that meets the 

criteria of paragraph (a)(1) through (3) of this section. 

 (1) The organization opposes providing coverage for some or all of any contraceptive 

items or services required to be covered under §54.9815-2713(a)(1)(iv) on account of religious 

objections. 

(2)(i) The organization is organized and operates as a nonprofit entity and holds itself out 

as a religious organization; or 

(ii) The organization is organized and operates as a closely held for-profit entity, as 

defined in paragraph (a)(4) of this section, and the entity’s objection to covering some or all of 

the contraceptive services on account of its owners’ sincerely held religious beliefs is made in 

accordance with the organization’s applicable rules of governance, consistent with state law. 

(3) The organization must self-certify in the form and manner specified by the Secretary 

or provide notice to the Secretary of Health and Human Services as described in paragraph (b) or 

(c) of this section. The organization must make such self-certification or notice available for 

examination upon request by the first day of the first plan year to which the accommodation in 
CMS-9940-P 33 

paragraph (b) or (c) of this section applies. The self-certification or notice must be executed by a 

person authorized to make the certification on behalf of the organization, and must be maintained 

in a manner consistent with the record retention requirements under section 107 of ERISA. 

(4) [Reserved] 

* * * * * 

DEPARTMENT OF LABOR 

Employee Benefits Security Administration 

For the reasons stated in the preamble, the Department of Labor proposes to amend 29 

CFR part 2590 as follows: 

PART 2590--RULES AND REGULATIONS FOR GROUP HEALTH PLANS 

 1. The authority citation for part 2590 is revised to read as follows: 

Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-1183, 1181 note, 1185, 

1185a, 1185b, 1185d, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Pub. L. 104-191, 110 Stat. 

1936; sec. 401(b), Pub. L. 105- 200, 112 Stat. 645 (42 U.S.C. 651 note); 

sec. 512(d), Pub. L. 110-343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Pub. L. 111-148, 124 

Stat. 119, as amended by Pub. L. 11-152, 124 Stat. 1029; Secretary of Labor's Order 1-2011, 77 

FR 1088 (January 9, 2012). 

2. Section 2590.715-2713A is amended by revising paragraph (a) to read as follows: 

§ 2590.715-2713A Accommodations in connection with coverage of preventive health 

services. 

(a) Eligible organizations. An eligible organization is an organization that meets the 

criteria of paragraph (a)(1) through (3) of this section. 
CMS-9940-P 34 

(1) The organization opposes providing coverage for some or all of any contraceptive 

items or services required to be covered under § 2590.715-2713(a)(1)(iv) on account of religious 

objections. 

(2)(i) The organization is organized and operates as a nonprofit entity and holds itself out 

as a religious organization; or 

(ii) The organization is organized and operates as a closely held for-profit entity, as 

defined in paragraph (a)(4) of this section, and the entity’s objection to covering some or all of 

the contraceptive services on account of its owners’ sincerely held religious beliefs is made in 

accordance with the organization’s applicable rules of governance, consistent with state law. 

(3) The organization must self-certify in the form and manner specified by the Secretary 

or provide notice to the Secretary of Health and Human Services as described in paragraph (b) or 

(c) of this section. The organization must make such self-certification or notice available for 

examination upon request by the first day of the first plan year to which the accommodation in 

paragraph (b) or (c) of this section applies. The self-certification or notice must be executed by a 

person authorized to make the certification on behalf of the organization, and must be maintained 

in a manner consistent with the record retention requirements under section 107 of ERISA. 

(4) [Reserved] 

* * * * * 

DEPARTMENT OF HEALTH AND HUMAN SERVICES 

For the reasons stated in the preamble, the Department of Health and Human Services 

proposes to amend 45 CFR subtitle A, part 147 as follows: 

PART 147--HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP 

AND INDIVIDUAL HEALTH INSRUANCE MARKETS 
CMS-9940-P 35 

 1. The authority citation for part 147 continues to read as follows: 

 Authority: Secs 2701 through 2763, 2791, and 2792 of the Public Health Service Act 

(42 U.S.C. 300gg through 300gg-63, 300gg-91, and 300gg-92), as amended. 

 2. Section 147.131 is amended by revising paragraphs (b) and (f) to read as follows: 

§147.131 Exemption and accommodation in connection with coverage of preventive health 

services. 

* * * * *

(b) Eligible organizations. An eligible organization is an organization that meets the 

criteria of paragraph (b)(1) through (3) of this section. 

 (1) The organization opposes providing coverage for some or all of any contraceptive 

items or services required to be covered under §147.130(a)(1)(iv) on account of religious 

objections. 

(2)(i) The organization is organized and operates as a nonprofit entity and holds itself out 

as a religious organization; or 

(ii) The organization is organized and operates as a closely held for-profit entity, as 

defined in paragraph (b)(4) of this section, and the entity’s objection to covering some or all of 

the contraceptive services on account of its owners’ sincerely held religious beliefs is made in 

accordance with the organization’s applicable rules of governance, consistent with state law. 

(3) The organization must self-certify in the form and manner specified by the Secretary 

or provide notice to the Secretary of Health and Human Services as described in paragraph (c) of 

this section. The organization must make such self-certification or notice available for 

examination upon request by the first day of the first plan year to which the accommodation in 

paragraph (c) of this section applies. The self-certification or notice must be executed by a 
CMS-9940-P 36 

person authorized to make the certification on behalf of the organization, and must be maintained 

in a manner consistent with the record retention requirements under section 107 of ERISA. 

(4) [Reserved] 

 * * * * * 

 (f) Application to student health insurance coverage. The provisions of this section 

apply to student health insurance coverage arranged by an eligible organization that is an 

institution of higher education as defined in 20 U.S.C. 1002 in a manner comparable to that in 

which they apply to group health insurance coverage provided in connection with a group health 

plan established or maintained by an eligible organization that is an employer. In applying this 

section in the case of student health insurance coverage, a reference to “plan participants and 

beneficiaries” is a reference to student enrollees and their covered dependents. 

[FR Doc. 2014-20254 Filed 08/22/2014 at 3:30 pm; Publication Date: 08/27/2014]