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Attorney General Lockyer Announces Victory for California's Contraceptive Coverage Law

Employers Providing Prescription Health Coverage Must Include Prescription Contraceptives
Monday, October 4, 2004
Contact: (415) 703-5837

(SACRAMENTO) – Attorney General Bill Lockyer today announced the United States Supreme Court refused to hear a challenge to the state's 1999 law that requires non-religious employers who provide prescription drug benefits to their employees to also offer insurance coverage for contraceptives approved by the Food and Drug Administration (FDA).

"Today's U.S. Supreme Court decision ensures that this landmark law stands, providing a huge victory for working women who have suffered unfair and unjust prescription discrimination," Lockyer said. "As the California courts have consistently ruled, non-religious employers cannot discriminate against women in the workplace based on their employers' religious beliefs. This ruling makes it clear that women whose employers provide prescription health coverage will have coverage prescription contraceptives."

In 1999, the California Legislature enacted the California Women's Contraception Equity Act (WCEA) requiring employers to include prescription contraceptives if they provide prescription health insurance plans. The law exempted religious organizations if they met four criteria:<ul>
<li>Inculcation of religious values is the purpose of the entity.
<li>The entity primarily employs individuals who share its religious tenets.
<li>The entity primarily serves individuals who share its religious tenets.
<li>The entity is deemed a religious non-profit organization under the Internal Revenue Code.</ul>
The Attorney General's Office defended the law against a challenge filed in 2000 by Catholic Charities of Sacramento, Catholic Charities of Sacramento, Inc. v. California, et al., S099822, arguing that Catholic Charities does not qualify as a religious employer. Although the Catholic Charities of Sacramento is affiliated with the Catholic Church and the Roman Catholic Bishop of Sacramento, Inc., the Attorney General argued it is a separately incorporated and administered organization and is not deemed a religious, non-profit organization under the federal tax code.

The Attorney General argued that Catholic Charities is not a religious employer under the WCEA because the organization is a nonprofit public benefit corporation that receives substantial public funding and enters contracts with public agencies. Further, Catholic Charities was not formed to inculcate religious values and it does not primarily employ or serve individuals who share the tenets of the Catholic Church.

The California Supreme Court, in its March 2004 ruling upholding the law, noted that Catholic Charities "candidly acknowledges" that it "employs a diverse group of persons of many religious backgrounds" and "serves people of all faith backgrounds, a significant majority of [whom] do not share [its] Roman Catholic faith."

Lockyer said a contrary ruling would have allowed Catholic Charities to discriminate against its female employees who did not share the beliefs of the Roman Catholic Church.

"This law protects true religious organizations while ensuring working women are not subjected to discrimination," Lockyer said. "It is unfair and wrong for a health and disability insurance plan to cover new products like Viagra, yet refuse to cover contraceptives that have had FDA-approval for the past 40 years."

The Legislature enacted the WCEA after finding women pay an average of 68 percent more in out-of-pocket medical expenses than men, primarily because they pay $400-$500 a year for contraceptives.

"Today's action by the U.S. Supreme Court protects religious freedoms while bringing an end in California to a 40-year history of gender discrimination," Lockyer said.

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