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January 11th, 2013
03:40 PM ET

Hobby Lobby finds way around $1.3-million-a-day Obamacare hit - for now

By Eric Marrapodi, CNN Belief Blog Editor

Washington (CNN) - By Friday, Hobby Lobby would have racked up $14.3 million in fines from the Internal Revenue Service for bucking Obamacare. But in keeping with the great American tax tradition, they may have found a loophole.

The company is facing $1.3 million a day in fines for each day it chooses not to comply with a piece of the Affordable Care Act that was set to trigger for them on January 1. The craft store chain announced in December that, because of religious objections, they would face the fines for not providing certain types of birth control through their company health insurance.

The penalty was set to go into effect on the day the company's new health care plan went into effect for the year.

Peter M. Dobelbower, general counsel for Hobby Lobby Stores, Inc. said in a statement released through the Becket Fund that, "Hobby Lobby discovered a way to shift the plan year for its employee health insurance, thus postponing the effective date of the mandate for several months."

The statement continued that "Hobby Lobby does not provide coverage for abortion-inducing drugs in its health care plan. Hobby Lobby will continue to vigorously defend its religious liberty and oppose the mandate and any penalties."

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Last month Supreme Court Justice Sonia Sotomayor rejected the company's appeal for a temporary relief from the steep fines while their case made its way through the lower courts.

Hobby Lobby announced a day after the ruling that it "will continue to provide health insurance to all qualified employees. To remain true to their faith, it is not their intention, as a company, to pay for abortion-inducing drugs."

In September, Hobby Lobby and affiliate Mardel, a Christian bookstore chain, sued the federal government for violating their owners' religious freedom and ability to freely exercise their religion.

The lawsuit says the companies' religious beliefs prohibit them from providing insurance coverage for abortion-inducing drugs. As of August 2012, the Patient Protection and Affordable Care Act, dubbed Obamacare, requires employer-provided health care plans to provide "all Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity," according to the U.S. Department of Health and Human Services.

Churches and houses of worship are exempt from the regulation and a narrow exemption was added for nonprofit religious employers whose employees "primarily share its religious tenets" and who "primarily serve persons who share its religious tenets."

The Internal Revenue Service regulations now say that a group health care plan that "fails to comply" with the Affordable Care Act is subject to an "excise tax" of "$100 per day per individual for each day the plan does not comply with the requirement." It remains unclear how the IRS would implement and collect the excise tax.

A spokesperson for the Justice Department declined to comment on the high court's move last month.

White House officials have long said they believe they have struck an appropriate compromise between religious exemptions and women's health. The White House has not commented specifically on the Hobby Lobby case.

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The Oklahoma City-based Hobby Lobby chain has more than 500 stores that employ 13,000 employees across 42 states, and takes in $2.6 billion in sales. It is still privately held by CEO and founder David Green and members of his family.

"The foundation of our business has been, and will continue to be strong values, and honoring the Lord in a manner consistent with biblical principles," a statement on the Hobby Lobby website reads, adding that one outgrowth of that is the store is closed on Sundays to give its employees a day of rest.

MORE BACKGROUND: Hobby Lobby faces millions in fines for bucking Obamacare

The Hobby Lobby case is just one of many before the courts over the religious exemption aspects of the law. The case represents by far the biggest for-profit group challenging the health care mandate.

Part of the reason Sotomayor rejected their appeal to the Supreme Court she wrote was because their case is still pending in the 10th Circuit Court of Appeals in Denver.

A spokesperson for the Becket Fund said on Friday a date has yet to be set for the case to be heard in the 10th Circuit.

- CNN Belief Blog Co-Editor

Filed under: Belief • Church and state • Courts

soundoff (4,609 Responses)
  1. It's a pickle

    We need more affordable health care and we also need less government...now how to manage that one?

    January 12, 2013 at 7:40 pm |
  2. Tiger82

    OK, One more time, with feeling, people: EC – emergency contraceptives – DO NOT cause abortions!!! They actually prevent the egg's release! No egg release, no fertilization. No fertilization, no implantation!
    Science is your friend. Look into it, HL!!
    http://www.motherjones.com/mojo/2012/06/morning-after-pill-plan-b-abortion-implantation-personhood

    January 12, 2013 at 7:40 pm |
    • Hmmmmmm

      They don't care about facts and truth and annoyances like that. They just want to have their opinions confirmed and not pay for anything'

      January 12, 2013 at 7:42 pm |
    • Matthew

      You could say the same thing about the people wanting the free birth control. They want their opinions and they don't want to have to pay for anything.

      January 12, 2013 at 7:47 pm |
    • Richy Rich

      Actually, it also messes with the lining of the uterus, so yes I can induce abortions or prevent implantation of the zygote, which is a viable embryo. Technically, if you have a viable embryo and prevent it's implantation, that would be in essence abortion.

      January 12, 2013 at 7:48 pm |
    • Richy Rich

      Actually, it also messes with the lining of the uterus, so yes I can induce abortions or prevent implantation of the zygote -> abortion basically.

      January 12, 2013 at 7:49 pm |
    • erwpitewrt

      By that theory, richy, a man who bops his baloney has caused an abortion because that prevents the zygote too.

      It's a good thing that the medical profession does not take their definition of abortion for dumbshits like you.

      January 12, 2013 at 7:54 pm |
    • Tom, Tom, the Piper's Son

      No, Richly Wrong, there is NO embryo or pregnancy prior to implantation. No pregnancy=no abortion. Look up the definition of pregnancy, doofus. No gynecologist or obstetrician calls a fertilized egg and embryo and no one is pregnant until implantation occurs. Furthermore, there is NO proof that the drug "messes with the lining of the uterus" you idiot.

      January 12, 2013 at 8:04 pm |
  3. krehator

    "religious liberty"

    Oxymoron

    January 12, 2013 at 7:40 pm |
    • Rational Libertarian

      No it isn't.

      January 12, 2013 at 7:41 pm |
  4. Matthew

    Why doesn't Obama want people to pay for their own birth control? Why is paying your own way becoming such a foreign idea in this country?

    January 12, 2013 at 7:39 pm |
  5. Tonya

    This company is just cheap. I hope they get fined big time. And, to all the people posting that the employees should just quit working there is laughable. In today's economic times, most folks don't have the luxury of just quitting in hopes of finding other suitable employment. Shame on Hobby Lobby. I will not give business to any company that refuses healthcare to their employees or cuts hours so they don't have to provide healthcare.

    January 12, 2013 at 7:39 pm |
    • Dan Jones

      I think Hobby Lobby should stick to their guns and tell liberals where to go. If Obama's fools refuse to relent than close the doors and fire all employees.

      January 12, 2013 at 7:43 pm |
    • Mohamad

      So let me guess, you are black and on welfare?

      January 12, 2013 at 7:52 pm |
  6. BE Hull

    Good for them – our country is under assault by all of these liberal European Democrats and we need to stand by family faith and God.

    January 12, 2013 at 7:39 pm |
    • omeany

      With respect, I think most people are tired of being preached at by people who have absolutely no intention of following what they are preaching. It happens when Republican Governors, Congressmen and Senators (and don't tell me they are moral) tell us they are going to ramrod abortion legislation through their legislative bodies even though it is clearly not the will of the majority.

      I think most people are beginning to question whether these things are really of God or if they are of the GOP. "We The People" are tired of working hard and getting the shaft.

      January 12, 2013 at 7:51 pm |
  7. paradigm shift

    Funny thing is, denying abortion services is not part of any established religion's cannon.

    January 12, 2013 at 7:39 pm |
    • omeany

      How they hate it when you actually read the bible!

      January 12, 2013 at 7:52 pm |
  8. jst saying

    If Hobby Lobby owners were good Christians they would be concerned about the children of their employees that are living and breathing everday, since they systematically don't hire people full time, only part time to avoid giving employees insurance, they would pay a living wage for those children parents, not minimum wage for 90% of their employees. Costco does it, Starbucks does it, they both do it on principle and decency.

    January 12, 2013 at 7:39 pm |
  9. looknclick

    I bet people working in Hobby Lobby got smaller checks because of the more taxes being deducted from their salary.

    Because of the the tax cliff deal, not because of their management.

    Everyone, have you experienced the cut in your income because of the expired tax breaks?

    January 12, 2013 at 7:38 pm |
  10. SAB

    If Obamacare required employers to provide health insurance that would cover euthanizing unwanted already born children, then dismissed the objections of business owners with a conscience by saying it's the corporation that is doing it, not them as individuals. . . would that be ok?

    January 12, 2013 at 7:38 pm |
  11. KlintzCNN

    Company A provides basic healthcare insurance, plus dental.

    Company B does not provide dental, but provides premium healthcare.

    Company C provides a cadillac healthcare package, plus dental, plus optometry care (glasses/contacts).

    Company D, with over 500 employees, provides no healthcare whatsoever.

    ObamaCare requires Company D to now provide healthcare to it employees–but what should they provide?

    January 12, 2013 at 7:38 pm |
    • Rational Libertarian

      Good point Klintz.

      January 12, 2013 at 7:40 pm |
    • the wall

      Basic healthcare should be the minimal requirement, numbskull!

      January 12, 2013 at 9:46 pm |
  12. Dave in Arizona

    I hope they get fined into bankruptcy.

    Nothing about providing birth control in their insurance plans requires any single one of their employees to go on birth control. Their religion doesn't condone the use of birth control? Fine. NOBODY IS FORCING THEM TO.

    Any religion at any time could decide that a certain common procedure conflicts with their views. Are we then to bend over and eliminate every procedure someone has an issue with? Society can't operate that way. There are many times in any communal environment that you need to respect others' beliefs in order to coexist. Of course, Christianity doesn't have the best track record in that regard...

    January 12, 2013 at 7:38 pm |
    • Dan Jones

      Why the hypocrisy? You claim that Hobby Lobby should respect the beliefs of those who want birth control, but you are filled with intolerance for Hobby Lobby's owners beliefs. If Hobby Lobby goes bankrupt all of those people loose their jobs. Is that what you want. Face it, Obama has declared war on Christians.

      January 12, 2013 at 7:41 pm |
    • omeany

      Good point Dave. If you don't believe in birth control don't use it. The same goes for having abortions but this does not mean you should prevent your employees access to these services if they do not believe as you do.

      January 12, 2013 at 7:56 pm |
  13. Dan Jones

    Hobby Lobby has my sincere respect. I will be a loyal customer.

    January 12, 2013 at 7:37 pm |
    • Ken in MO

      Funny. Hobby Lobby has your respect but it's employees do not. You do understand that corporations are not actually people...it is actually a business run by employees.

      PS. I am not trying to bash you in anyway...your logic just doesnt make any sense to me. You give corporations more respect and more power than you do individuals. I am confused.

      January 12, 2013 at 7:56 pm |
  14. Zedlok

    Ironically, the bible says NOTHING about birth control.

    January 12, 2013 at 7:36 pm |
    • Dan Jones

      It has plenty to say about abortion though.

      January 12, 2013 at 7:38 pm |
    • Conrad Murray

      The Bible also says nothing about women's rights...or the rights of minorities either....

      January 12, 2013 at 7:40 pm |
    • Hmmmmmm

      Actually, no it doesn't. Not a word about abortion.

      January 12, 2013 at 7:40 pm |
    • rick

      really, dan? where does it mention abortion?

      January 12, 2013 at 7:40 pm |
    • SAB

      Thou shalt not kill

      January 12, 2013 at 7:44 pm |
    • omeany

      It's actually part of the books overall theme..."control of the masses"!

      January 12, 2013 at 7:57 pm |
  15. havasu

    This is so ridiculous. The morning after pill does not even cause abortions. It prevents pregnancy from happening. It does not get rid of an existing pregnancy. It is not the RU 468 abortion pill.

    January 12, 2013 at 7:36 pm |
    • Richy Rich

      Actually, the morning after pill does/can induce abortions by making the lining of the uterus unfavorable for implantation of the zygote. For all intents and purposes, if the sperm and egg join, you have a viable embryo. If you mess with the lining to prevent implantation, you are causing an abortion at cell 1 to 8. Usually implants at 16 or 32 cells, I believe.

      January 12, 2013 at 7:47 pm |
  16. These People Are Nuts

    Oh yeah, loopholes are the epitome of fine Christian behavior. Jesus was all about the loopholes. Forget that healing the sick business. Everyone knows the New Testament is optional reading.

    January 12, 2013 at 7:36 pm |
    • Ken in MO

      Please, dont bash Christians. I am for Obamacare and I am a Christian. Real Christians know that modern medicine cures peoples bodies and prayer cures their hearts and souls. I have absolutely NO DOUBT IN MY MIND that Jesus would be a Democrat and be considered VERY liberal by todays standards. Many of the far right "Kristians" like Todd Aiken, and almost all of the GOP frontrunners are Christians with a "K". They are a political group and have absolutely nothing to do with the bible or Jesus.

      January 12, 2013 at 8:00 pm |
    • omeany

      Now that's what I'm on about! How quickly these "God Fearing" employers forget about healing the sick...they are too busy trying to squirm out of their responsibility to provide health care. I bet their employees haven't had a raise in quite a while either.

      January 12, 2013 at 8:02 pm |
  17. Chantal

    I am glad that Hobby Lobby is sticking to their beliefs. If you want to work there, it would make sense that you share the same values and beliefs therefore these government mandates are not necessary.

    We should all be very scared if the government can dictate our religious beliefs. Who in their right mind would start a business in the future with all the regulations the government is placing on innovation and business owners?

    I will happily shop there knowing that I am supporting religious freedom. This company deserves positive recognition for not being bullied into paying for medical services they do not believe in.

    January 12, 2013 at 7:36 pm |
    • Jewels

      Not me....I will never go into another Hobby Lobby for as long as I live....

      January 12, 2013 at 7:41 pm |
    • Shon

      Jesus said if taxes "pay to Cesear what is his"

      So how exactly is avoiding taxes the Christian thing to do? People work places because they have bills to pay, not because of their religious affiliations. These people aren't running a church they are running a business.

      January 12, 2013 at 7:48 pm |
  18. Matt

    What employees need is a nice shiny made up word like the employers get: "job creators."

    I vote "job actuators". As is they are the ones who actually do the work that make the company profitable and successful.

    January 12, 2013 at 7:35 pm |
    • omeany

      and some of us have been actuating without a raise for several years now while the job "creators" have been living pretty well and doing their best to screw us out of more benefits.

      January 12, 2013 at 7:39 pm |
    • Jim

      Actually, it is the customer that makes a company successful. It doesn't matter how hard employees work. if the consumer doesn't want the product then the company will go bankrupt.

      January 12, 2013 at 7:40 pm |
    • Bob

      The employees can all be replaced. If they were the ones that made the company profitable then they can start their own companies and give their employees anything they want. If Hobby Lobby closed it's doors the owners would still be rich and the employees would be scrambling to make ends meet. If running a multi-million dollar company was easy everyone would be doing it, even you.

      January 12, 2013 at 7:49 pm |
  19. Bart

    On a side note, every other Corporation in American just declared themselves strict practicioners of Haitian Voodou. No Western medical practices are allowed. They will provide Voodou dolls, but anything else will be against their religious beliefs.

    January 12, 2013 at 7:35 pm |
    • Rational Libertarian

      And it should be their decision to make.

      January 12, 2013 at 7:36 pm |
    • International Banks

      Does voodoo somehow protect us from currency manipulation prosecution? We're in if it does.

      January 12, 2013 at 7:38 pm |
    • knucklecheese

      I see what you're TRYING to do, but sorry buddy, you failed miserably. Not even close, really. See, the thing is that a fetus isn't a disease. Abortion drugs don't treat or prevent disease. They prevent or end early stage pregnancy, nothing more. The plaintiff isn't arguing against providing for actual medical treatment under religious pretense, they are only arguing that they have the right not to pay for abortions of any kind. It really is that simple, and you really are wrong. That's OK though. It certainly doesn't make you a dummy or a bad person!

      January 12, 2013 at 7:42 pm |
    • Bart

      Nope, you missed it altogether. The type of treatment doesn't matter, because there are other just as legit religions with other beliefs on other procedures that can follow the same path as Hobby Lobby. What matters is if Hobby Lobby wants to be a for profit company or if they want to be a religion. When they want to be a for profit company and use their religion to sidestep laws and benefit their profits, that is out of bounds. They are free to become a religion any time they want and practice their religious beliefs as they see fit. When they want to open a business and have employees and serve the public, they must follow the same laws that all businesses do.

      January 12, 2013 at 7:51 pm |
    • Tom, Tom, the Piper's Son

      knucklehead, you are dumb as a box of turds. There is NO abortion being caused by Plan B.

      What a bunch of ass waffles.

      January 12, 2013 at 9:12 pm |
  20. Angelo Amadio

    Do not shop at Hobby Lobby! This has nothing to do with religion and everything to do with the continued abuse and enslavement of the minimum wage worker! Shame on Hobby Lobby for using God as a reason NOT to provide healthcare. The conduct of Hobby Lobby, it's managers, directors, and executives only makes sense if they worship the Devil. Hobby Lobby and Corporate America in general are anything but godly and moral.

    January 12, 2013 at 7:32 pm |
    • bigdoglv

      I'm still wondering what being forced to supply contreception has to do with lowering the price of health care. I am all for women's rights, but doesn't a private business have rights too?

      January 12, 2013 at 7:38 pm |
    • Hmmmmmm

      So rational, you shop at businesses that openly embrace liberal values?

      January 12, 2013 at 7:39 pm |
    • Daniel

      Enslavement? Really? If the people don't like working for Hobby Lobby then they don't have to work there. No one is forcing them to stay.

      January 12, 2013 at 7:40 pm |
    • Rational Libertarian

      I shop at stores which provide goods I want because that's how supply and demand works.

      January 12, 2013 at 7:41 pm |
    • looknclick

      What else do you want us not to do or do?

      January 12, 2013 at 7:41 pm |
    • omeany

      It;s amazing how "God Fearing" these guys become when it comes to doing what they can to give their employees less benefits.

      You watch, the next step will be to make all employees part time so they don't have to provide benefits at all. That's the crap Papa John's Pizza is going to pull while their owner lives in a freakin castle!

      January 12, 2013 at 7:42 pm |
    • mollypearson

      Regardless of your feelings on what Hobby Lobby is doing, at least try to get the facts straight. Hobby Lobby has not at all tried to take away insurance coverage for their employees nor has that been an option on the table for them. They were willing to take on significant fines in order to continue to provide coverage for their employees. Also, Hobby Lobby is a friend to minimum wage workers. It is company policy that all full time employees make more than $3 more than the minimum wage. You can say what you want about their beliefs and their policies but at least do it with truth.

      January 12, 2013 at 7:44 pm |
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About this blog

The CNN Belief Blog covers the faith angles of the day's biggest stories, from breaking news to politics to entertainment, fostering a global conversation about the role of religion and belief in readers' lives. It's edited by CNN's Daniel Burke with contributions from Eric Marrapodi and CNN's worldwide news gathering team.