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WASHINGTON – President Obama on Friday moved forward with his compromise for religious institutions objecting to his health care mandate, but it’s unlikely to satisfy the colleges that don’t want to provide free contraception through their insurance plans.

The U.S. Department of Health and Human Services’ Notice for Proposed Rule Making essentially codifies an alternative proposal the administration put out nearly a year ago. Churches and other houses of worship are exempt. But after scores of religious organizations protested and sued over the prospect of providing employees (and in colleges’ case, students) with free birth control, Obama countered with this offer: religious entities other than churches and houses of worship would still be subject to that provision of the Affordable Care Act, but could pass on the cost of contraception to the insurer.

However, the new proposal has not ended the objections of some religious colleges. They and other organizations had hoped that in the months since, the administration might expand the blanket exemption to cover more nonprofits, but the proposed rule does not do so.

The insurance “accommodation” in the rule – which allows religious entities not covered by the exemption to pass on the costs – is “radically inadequate,” said the lawyer who represented institutions like Wheaton College, Belmont Abbey College and Colorado Christian University in their suit against the federal government.

The accommodation “doesn’t change the moral landscape at all for them,” Kyle Duncan, general counsel for the Becket Fund for Religious Liberty, said in a call with reporters Friday. “Many of them have serious concerns about remaining conduits for the drugs and devices that are mandated by the federal government.”

Michael Galligan-Stierle, president of the Association of Catholic Colleges and Universities, said he was "encouraged by the administration's reconsideration" of the policy. "ACCU will now study the language and solicit feedback from our member institutions to determine to what extent the new proposal moves our community and the administration closer toward resolution of this issue," he said.

The ACA requires all employers to provide contraception, which it considers preventive care, without co-payment. Under the accommodation, nonprofit religious organizations like colleges “would not have to contract, arrange, pay or refer for any contraceptive coverage to which they object on religious grounds,” according to HHS.

Instead, people on the plans in question would receive contraceptive coverage through separate, individual insurance policies.

Colleges that insure students and employees would first ensure that they meet the accommodation criteria. Those criteria are religious opposition to covering contraception; status as a nonprofit entity; holding oneself out as a religious organization; and a self-certification that it meets the criteria and specifies the contraceptive services it will not cover.

After that, colleges would take one of two routes, depending on which type of insurance plan they use.

At those with insured group plans – which provide coverage for between 1 and 3 million students, according to HHS – the insurer would provide separate, individual contraceptive coverage to the patient at no cost. HHS says this will be a cost-neutral approach because the preventive care will offset costs in women’s health and childbirth that would otherwise be incurred.

Colleges with self-insured group plans – which pool premiums to pay for coverage rather than going through an insurance company – would have their third-party administrator find an insurer to cover the costs. About 30 colleges use self-insured health plans, covering about 200,000 students.

Young Invincibles, a health advocacy organization for college students and other young adults, said in a statement that it applauds the rule, which will provide access to essential health care services.

However, the group noted it is still not fully satisfied, noting an announcement earlier this week that self-insured plans will not be subject to the ACA, thereby exempting them from consumer protections such as prohibitions on lifetime benefit caps.

“That regulation effectively excludes many young students from this guarantee of access to preventative care,” the statement reads.

At least one religious college, Franciscan University of Steubenville, dropped its student health plan in May in response to the mandate. However, administrators said contraception was only part of the equation; they believed premiums would raise to unacceptable levels under ACA. Xavier University, meanwhile, said in April it would no longer cover birth control for employees.

Employees at some religious colleges back the contraception plan. Faculty and staff at John Carroll University, a Jesuit institution in Ohio, sent a letter to the university president urging him to accept the administration’s compromise.

The University of Notre Dame and the Catholic University of America, two of 10 or so institutions that have sued the administration over the mandate (their lawsuits were dismissed because of the implementation grace period), sent statements to Inside Higher Ed on Friday saying they needed to more thoroughly review the rule before commenting. 

A spokeswoman for the Council for Christian Colleges and Universities shared this statement: "This is a complex issue. We are carefully studying the ramifications of the proposed notice of rule-making which was issued today. We remain strongly committed to protecting the religious liberties of our Christian colleges and universities."

Religious colleges have an additional year to comply with the requirement, which takes effect in 2013. The administration is seeking public comment on the proposed rule through April 8.

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