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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 • Faith Now

soundoff (4,609 Responses)
  1. Al

    Hobby Lobby as well as other companies, should only be required to offer health care to non-believers. The people of faith don't need it; God will watch over them until the end.

    January 13, 2013 at 11:52 am |
    • TD

      Not even close. Keep trying.

      January 13, 2013 at 11:56 am |
    • are122

      Then the unions and all the politicians must be people of great faith.

      January 13, 2013 at 11:56 am |
    • Al

      When a person of faith goes to the doctor, they are trying to manipulate the divine plan.

      January 13, 2013 at 12:01 pm |
    • Al

      If God didn't want you to have heart desease then he wouldn't have given it to you in the first place.

      January 13, 2013 at 12:03 pm |
    • TD

      Al, your concept of the belief in God is so flawed, someone cannot even attempt to change your perception. Devine plan? If God didn't want something? Learn facts about the belief in God by responsible people first, then comment.

      January 13, 2013 at 12:07 pm |
    • Al

      Okay, it's a divine plan when it's convenient, and it's divine not devine.

      January 13, 2013 at 12:20 pm |
  2. Rosslaw

    The definition of right-wing logic-do everything to avoid providing health care to employees due to your supposed belief in Jesus.

    January 13, 2013 at 11:50 am |
    • Sue

      So true. Deny women health care... how "christian".

      January 13, 2013 at 11:51 am |
    • TD

      Not even close. keep trying.

      January 13, 2013 at 11:54 am |
    • TD

      They do not want to deny healthcare, they just do not want that to be a mandated item.

      January 13, 2013 at 11:55 am |
    • Joe

      Yeah, infanticide....woman's healthcare.

      January 13, 2013 at 11:57 am |
    • are122

      What's the excuse for all the politicians??

      January 13, 2013 at 11:58 am |
    • Tom, Tom, the Piper's Son

      Any idiot that can't distinguish between contraception and infanticide is too stupid to warrant anything but ridicule.

      January 13, 2013 at 12:10 pm |
  3. Pethuel

    Many of the comments here are missing the bigger issue. This case is not so much about contraception, abortion, who pays for what; but rather about individual liberties. The rights of Americans under the Bill of Rights has been systematically under attack for at least the last 60 years (you can make a case to go further). It did not begin with Obama by any means, but the assault was stepped up under GWB with the passing of the Patriot Act. This a clear violation of the 4th Amendment. These violations are now even more egregious under the NDAA. Drone strikes on American citizens where the President (whomever that may be) should strike fear into every citizen. Everyone now sees the Second Amendment under attack yet again, (and BTW the Assault Weapons Ban under President Clinton, did not stop Columbine). The implimentation of Obamacare is just another attack on the First Amendment. This is the toughest nut to crack for those who would impose tyrrany (Dem or Repub). Start small, go after the "evil" corporations first. Then work your way up. CITIZENS UNITED case affirmed corporations have free speech rights, same as indivivuals and Unions. Every liberty-loving American should be concerned about the HL case. You may despise HL's stance and their beliefs, but it is only a matter of time until the gov't gets around to mandating control or taking away rights that you, as an individual, do care about. By then, it may be too late. Precident may already be set. Do not be fooled for one minute that any gov't mandate or Executive Order will end with HL or just with private coporate enterprises.

    January 13, 2013 at 11:49 am |
    • TD

      Great post! Excellent!

      January 13, 2013 at 11:58 am |
    • are122

      Already happened. All the sheeple jumped in line while the politicians rejected what they created.

      January 13, 2013 at 12:01 pm |
  4. are122

    It's amusing this business is fined (or attempted to) because of a rejection of Obama care. Obama rejects Obama care. All politicians have rejected Obama care. Many unions are able to reject Obama care. Ordinary people have a right to quit this company...while ordinary people have no right to quit Obama care. Our government is hypocritical to reject what they require for us. Good for you, Hobby Lobby. At least you have guts enough to stand up for yourself...unlike most of the US population.

    January 13, 2013 at 11:49 am |
  5. CaesarXIII

    If you don't like the beliefs of your employer and what they have to offer you other than a paycheck then find a new place to work... Oh wait, no jobs. I forgot that was a #1 priority, I guess everyone else forgot too.

    January 13, 2013 at 11:48 am |
    • gwolfpack

      religion is fine but they do not have a right to impose their faith on their employees

      January 13, 2013 at 11:52 am |
  6. wayne1

    Fundamentalist Christians have in recent decades become part of the right wing of the Republican party. The only thing conservative Republicans really believe is that the top 1% should have all the money, and rest of us should be stomped on. Thus right wing Christians are a fundamental threat to the economic welfare of the average American. Anything that could be done to curb their pernicious influence should be encouraged.

    January 13, 2013 at 11:44 am |
    • AndyMax71

      Wayne is a typical hypocritical bigot that hates those with different religious beliefs.

      January 13, 2013 at 11:47 am |
    • TD

      This country is split down the middle, give or take a percentage point or two. If ALL republicans think just 1% should have all the money, what are the other 49% hoping for? Their beliefs about spending, government, healthcare, education and so on count for nothing? Your idea of what a republican wants or how they think is flawed.

      January 13, 2013 at 12:04 pm |
  7. James PDX

    Hobby Lobby is being forced to pay their employees fair wages by US law. Does anybody feel that HL has the right to tell their employees how they spend their fairly earned compensation? But by HL's logic, if they provided the wages and those wages were spent on the Morning After pill, HL has effectively paid for that pill. There is no difference with health coverage, which is a fairly earned compensation that the law requires. The company must provide it in compensation for working employees, and the employees get to decide how they use what they have fairly earned.

    January 13, 2013 at 11:40 am |
    • AndyMax71

      Hypocrite. Demanding employers be forced to pay for the personal actions of its employees but refusing to allow the employer to decide whether to keep those employees on their payroll or not.

      January 13, 2013 at 11:42 am |
    • James PDX

      When they pay their wages, they are paying for almost every action of their employees. It's the very basis of an employer/employee relationship. If you take that away, there is no longer any reason for people to work. Think before you type.

      January 13, 2013 at 11:50 am |
    • TD

      By your logic, HL buys houses, cars, drugs, guns, alcohol, and everything that consumers buy. But those things are not mandated. a morning after pill should not be a mandated healthcare item. it is a choice of an individual. And once an employee gets their paycheck, the employer is not EFFECTIVELY buying anything for them. Bad logic.

      January 13, 2013 at 11:51 am |
    • KMA

      There is an absolute difference between health care benefits being offered and salary dollars being paid. You, sir, are badly mistaken in your thought process.

      January 13, 2013 at 11:54 am |
    • MikeD

      I think the point here is that health insurance is part of one's compensation package. It is earned along with wages and therefore, subject to federal requirements just as it is with the minimum wage.

      January 13, 2013 at 12:03 pm |
    • TD

      MikeD, I agree with your point 100%. The part I disagree with is the government mandating that certain things should be part of a BASIC healthcare package. Morning after pills are NOT a basic concern.

      January 13, 2013 at 12:11 pm |
    • Tom, Tom, the Piper's Son

      That's YOUR opinion. Plan B is a contraceptive. It is an emergency medication. Other "emergency" medications are part of "basic health care." I'll bet emergency inhalers are "basic".

      Really, what a thin argument. If a woman spends 75% of her reproductive years trying NOT to get pregnant, when more than HALF of the pregnancies that occur are unplanned, Plan B IS basic. Get over it.

      January 13, 2013 at 12:15 pm |
    • james

      The point I was trying to make is that when certain issues this one among others that are clearly opposed to Gos will or law for mankind written in his book are violated Christians are to reject this and follow the higher authority. It does not matter what the law of man is that is not the point the point is if man violates Gods law believers are to oppose this. Now if you want to passd a law that does not try to force me or people of faith to violate their beliefs OK. Like aborition or I mean murder it is the law of the land I do not support it. It is in clear violation of Gods will I can live in this society with it going on and resist the sin but if you try to force me to participate with my money to promote it I will resist. Is this more clear.

      January 13, 2013 at 6:27 pm |
  8. Joe

    100s of years before, the pilgrim fathers flew England for their religious freedom. Now were will we go to protect our religious freedom?

    January 13, 2013 at 11:39 am |
    • James PDX

      I'm sorry, where in this article does it say you can't worship any god you want? You're just being restricted from infringing upon that same liberty of others.

      January 13, 2013 at 11:41 am |
    • Dna

      Probably not the best idea to use brutal fundamentalists, like the pilgrims, to garner sympathy.

      January 13, 2013 at 11:52 am |
    • Amy

      I don't know, but you're free to leave the country if you think it's so bad. In fact, please do, and take all your conservative christian buddies with you so we can get back to separation of church and state.

      January 13, 2013 at 11:54 am |
    • Jean Sartre

      HL is a BUSINESS; it is not a CHURCH.

      ALL businesses must comply with the LAW; in point of fact, 26 states complied with this very same law, which has been in effect for many years, prior to the ACA.

      This is nothing more than another attempt of religious zealots to impose their beliefs upon their employees – women – and save $$$ on healthcare insurance. It is not the right of any religion to dictate healthcare...

      January 13, 2013 at 11:58 am |
    • jellyroll713

      The pilgrims did flee from England for reasons of religious liberty. Unfortunately the freedom they were seeking was the right to persecute others that did not conform to their puritanical values. They fought for the right to "try" (these trials did not involve any actual justice and were really just for show) and convict people people for perceived religious indiscretions. Think "Scarlet Letter" and the Salem witch trials. Believe me, the puritan pilgrims were dictatorial fascists by any measure.

      January 13, 2013 at 12:02 pm |
  9. DBL

    Congrats to Hobby Lobby for avoiding paying the fine. Now, how are they going to avoid the unwanted pregnancies of their female employees who will now not have access to affordable birth control?

    Their action will certainly cause more abortions, not less.

    January 13, 2013 at 11:36 am |
    • AndyMax71

      How deranged do you need to be to think that an employer should be responsible for the actions of loose women that work for them?

      January 13, 2013 at 11:40 am |
    • GiaoHoan

      Too bad China is having too many forced abortions. That cuts down on the number of available workers for Hobby Lobby's factories.

      January 13, 2013 at 11:42 am |
    • elle

      maybe the female employees should keep their legs closed or buy a 99 cent condom? just some thoughts to avoid abortions...

      January 13, 2013 at 11:43 am |
    • Mark42R

      Or Elle, maybe it's nobody's business. Maybe employers should also require people to eat more healthy food so they don't have to subsidize their trip to a cardiologist? How far should they police employees personal behavior?

      January 13, 2013 at 11:53 am |
    • Tom, Tom, the Piper's Son

      So elle, you never have s#x with your spouse unless you WANT to get pregnant? Your boyfriend always uses a rubber? What is your problem with requiring an employer to offer an insurance plan that covers contraception?

      January 13, 2013 at 12:09 pm |
    • Damocles

      @elle

      Now that's some damn fine advice you got there.

      I can see you coaching your daughter as she gets ra-ped.... 'for heaven's sake Suzy, go buy a condom for the poor boy'.

      January 13, 2013 at 12:12 pm |
  10. woodie

    If you deny health care to your employee based on religion reasons, you should be fined. Health care is more important than religious persecution.

    January 13, 2013 at 11:35 am |
    • TD

      healthcare...yes. abortion pills...no. abortion is a choice, one that all should have. it should not be a mandate. hobby lobby has no problem providing healthcare, just certain provisions against their beliefs. abortion clauses should not be included as a BASIC healthcare need.

      January 13, 2013 at 11:38 am |
    • Ron

      I didn't realize that pregnancy was a disease. Why should an employer assume the moral hazard of its employees?

      January 13, 2013 at 11:49 am |
    • James PDX

      The Morning After pill prevents a single cell organism from ataching to the uterine wall. That is not an abortion. How can so many of you not have any clue what you are talking about yet still argue so vehemently in favor of your ignorance?

      January 13, 2013 at 11:53 am |
    • kfitton

      TD... You would be right about the whole person choice thing, except it's not the employers choice that matters in this instance. It is the employee's individual choices on how to use their health insurance, not the employer. Just because you have religious beliefs doesn't mean you can force your employees to believe in the same beliefs as well. Are conservatives using Mr. Scrooge and Bob Cratchet as the new employer/employee model?

      January 13, 2013 at 11:58 am |
    • Tom, Tom, the Piper's Son

      Ron, you're not very well-informed, are you? If you think that pregnancy does not have serious risks, you shouldn't even comment about it.

      January 13, 2013 at 12:19 pm |
  11. JJ

    IT'S STILL AMERICA!!

    January 13, 2013 at 11:33 am |
    • AndyMax71

      Even as it continues to become more and more like Cuba.

      January 13, 2013 at 11:43 am |
  12. Tom, Tom, the Piper's Son

    I really wonder about some of the dimwits here. If you're so stupid that you don't know the difference between Plan B and RU486, why are you commenting?

    Here's a question for you dip wads: Would you approve of Plan B if a woman used it after r ape?

    January 13, 2013 at 11:32 am |
    • Ron

      Does it matter?? Health insurance it to protect you from bad health...not irresponsible behavior.

      January 13, 2013 at 11:51 am |
    • Tom, Tom, the Piper's Son

      Being r aped is "irresponsible behavior"? What special kind of stupid ARE you?

      January 13, 2013 at 12:05 pm |
    • Tom, Tom, the Piper's Son

      What is "irresponsible" about preventing a pregnancy? Are you an idiot? Women who are MARRIED have birth control failures. THEY might wish to prevent an unwanted pregnancy with Plan B. It's a contraceptive, doofus.

      January 13, 2013 at 12:07 pm |
    • Damocles

      Hmmm so what about bad health caused by irresponsibility?

      January 13, 2013 at 12:07 pm |
    • Tom, Tom, the Piper's Son

      The insurance my company offers covers smoking cessation programs, alcohol dependency programs, weight loss programs, and also covers medication that is used to treat all sorts of illness that result from being a smoker, and alcoholic, or obesity.

      Do you have a problem with those?

      January 13, 2013 at 12:17 pm |
    • cb

      So Ron, by your line of reasoning health insurance should not pay for lung cancer treatment, diabetes treatment, treatment for traumatic accidents, melanoma treatment., all of which are caused mainly by irresponsible behavior.

      January 13, 2013 at 12:17 pm |
    • Tom, Tom, the Piper's Son

      Still waiting for Ron the Dumb to explain how being r aped is "irresponsible behavior."

      January 13, 2013 at 12:18 pm |
    • Damocles

      Right, so can I whine and complain about alcohol programs even though I'm not a drinker? Can I complain about the obesity stuff if I'm taking it upon myself to lose weight?

      January 13, 2013 at 12:20 pm |
  13. Greg Faith

    Obama care is nothing but a can of worms for paper pushers.

    January 13, 2013 at 11:31 am |
  14. PhiliaToo

    Because your employer should dictate your healthcare decisions based on their Religious Beliefs?

    January 13, 2013 at 11:29 am |
    • elle

      since when is abortion health care?

      January 13, 2013 at 11:44 am |
    • Tom, Tom, the Piper's Son

      Oh, for the love of Pete. This isn't about abortion. Plan B does NOT cause abortion. Get a clue.

      January 13, 2013 at 12:04 pm |
    • JFK57

      Before appling for a job, people need to check out the health care offerings of an employer. The employer should have complete control of the plans offered since they pay for them. Don't apply if you don't like the fact that the employer doesn't offer abortion benefits..........

      January 13, 2013 at 12:24 pm |
  15. joethejuggler

    Religious freedom does not mean forcing your religious beliefs on your employers.

    Employer provided health insurance is part of compensation. The argument that it comprises employers paying for abortifactants is the same as arguing that the wages they pay their employees (who may or may not be of the same religion) can also be restricted so that the employees don't use them for anything prohibited by their religion. And that, of course, is absurd.

    January 13, 2013 at 11:26 am |
    • asdf

      But your employees can force it on you? It's a private company, it can have whatever rules and regs it wants. You don't have a right to work wherever you want with no issues whatsoever. Just the right to work where you choose to.

      January 13, 2013 at 11:35 am |
    • Tom, Tom, the Piper's Son

      Big news, asdf: you're wrong. If a company wants to operate within the US, it has to abide by laws regulating labor.

      Catch up, will ya?

      January 13, 2013 at 11:37 am |
  16. DRinNC

    The notion that the federal government has any power to dictate how a business owner can compensate their employees, is to be found only in the minds of over zealous legislators, who's capacity for reason has been clouded. Lawmakers have, once again corrupted the intent of our founders.

    January 13, 2013 at 11:23 am |
    • joethejuggler

      Your kidding, aren't you? The federal government does indeed have authority to regulate worker compensation. Do you also oppose federal minimum wage laws on that basis? If so, your legal argument is on the losing side. The Supreme Court has recognized this authority since at least 1941. Good luck trying to reverse 70 plus years of settled jurisprudence!

      January 13, 2013 at 11:30 am |
    • Tim

      Just like such stupid government rules like minimum wage.... idiot.

      January 13, 2013 at 11:34 am |
    • Tom, Tom, the Piper's Son

      Can a business owner hire a 5-year-old? Can he/she refuse to allow employees to use the restroom? Refuse them a break for meals?

      Unbelievable stupidity on your part.

      January 13, 2013 at 11:35 am |
  17. WJ Morrow

    The companys insurance will cover viagra

    January 13, 2013 at 11:23 am |
    • GiaoHoan

      Proof that the God of Hobby Lobby is a MAN and not a higher spiritual being !

      January 13, 2013 at 11:31 am |
  18. leo maniace

    I am rooting for hobby lobby. The government has become an unmanagable obtrusive goliath that in no way serves the needs of the people.

    January 13, 2013 at 11:23 am |
    • bigfoot

      Don't drive your car out of your driveway or you will be a hypocrite, genius.

      January 13, 2013 at 11:27 am |
  19. GiaoHoan

    If Hubby Lubby can squeeze itself thru a tax loop hole, surely the owners will be able to squeeze themselves thru a camel's hole.

    January 13, 2013 at 11:19 am |
  20. Sandra Bazzani

    I guess Its our decision to not shop at Hpbby Lobby. What if they asked their customers what religion they were and when told didn't like that one so wouldn't sell to you. Same premiss.
    So if employees chose they can join the exchange that will be setup and get there insurance coverage from there. Good thing with that idea when they no longer work for Hobby Lobby their insurance travels with them to the next job.
    Really wish people would do their homework before trying to tear something apart. READ people study the best options for you and your family I for one am looking forward to having this option!!!!!!! Why because I have been reading!!!!!!

    January 13, 2013 at 11:18 am |
    • Really

      I bet you have be never been in a Hobby Lobby now you want to boycott it hahaha, bottom line is, employee should be able to by their own contraception or pay for their own abortion, no one should ever find themselves in a position when they have to choose between following their Faith or following government

      January 13, 2013 at 11:28 am |
    • AndyMax71

      Sandra should use the time and money she's spending shopping at Hobby Lobby and start doing something responsible for a change.... like buying her own condoms for her customers.

      January 13, 2013 at 11:45 am |
    • Tao

      At Really: it is not the employee's religion! The employer is shoving his religion onto his employees.

      January 13, 2013 at 12:42 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 and Eric Marrapodi with daily contributions from CNN's worldwide newsgathering team.