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
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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. TheAntiChrist

    And the land of the freeeeeeeeeeee. Oh im sorry I was singing the national anthem. Didn't mean to offend any one.

    January 12, 2013 at 7:04 pm |
  2. Peter

    So I now have to be denied my legally acceptable coverage because of the owner's personal beliefs?

    Oh, come on.

    I am not Catholic. So I have do follow this guy's belief?

    And the Catholics that work at Hobby Lobby? If they are good Catholics they won't use the coverage, right? Or will they?

    January 12, 2013 at 7:04 pm |
    • Martin

      Because in America, you re boss is God, and you are his slave. He's an almighty "job creator", and cna't be angered lest his wrath be unleashed. Your beliefs don't qualify, unless you have an Inc or Ltd or Co after your name.

      January 12, 2013 at 7:06 pm |
    • joey

      You don't have to be Catholic to clearly see how sick it is to take a pill to force a baby out of woman and kill it.

      January 12, 2013 at 7:08 pm |
    • steveiweevie

      Yes, Peter. You can still get your abortion, but will have to pay for it yourself.

      January 12, 2013 at 7:11 pm |
    • You really are clueless

      There is no such pill that forces a baby out of a woman. The morning after pills do not induce abortion.

      January 12, 2013 at 7:11 pm |
    • TJ

      You should find work elsewhere. No one is forcing you to work there. Just because you are an employee does not mean your rights trump the rights of the owner.

      Again, you are FREE to look for work elsewhere. The owner is not. It is HIS business, and he was NOT elected to position of "owner" or CEO.

      January 12, 2013 at 7:13 pm |
    • joey

      how about misoprostol, cytotec – now who's clueless

      January 12, 2013 at 7:14 pm |
    • Slo

      If you don't work there then its none of your business.

      January 12, 2013 at 7:21 pm |
  3. Ron D-

    The problem is that our national healthcare program is still in private hands. We need NATIONAL healthcare run by the government, just like all the more prosperous countries have. We are cutting costs by not having people go into the Hospital Emergency room for a $1,000 consultation over a sore throat that the rest of us get to pay for since the sick person has no money, but we're still at the mercy of the insurance companies.

    January 12, 2013 at 7:04 pm |
    • Barry Shanley

      true. a big reason why we have fallen to 47th in life expectancy...and continue to fall further! What is more important than that?

      January 12, 2013 at 7:10 pm |
    • davecu

      Perhaps. But have you forgotten what a fine and astute the government has done with the economy, medicare, social security, Amtrak, and the usps?
      It's gotta be criminal 'cause nobody is that stupid!

      January 12, 2013 at 7:16 pm |
    • Steve

      Which countries do you refer to? Canada? Takes 6 months to see an oncologist? England..where if it costs to much they let you die? Which countries specifically that have 350 million + people that have top notch health care? And we are 38th...whats the difference between 38th and top 10? HALF A DANG YEAR. Now the other 37 countries do they have fat people on welfare? No. So if we got rid of fat welfare people our life expectancy average will go up wont it. Where do heads of state go to receive medical care? Canada? Nope, England..heck no...oh ya America.

      January 12, 2013 at 7:18 pm |
    • Susan

      I couldn't agree more. There are a lot more statistics that could be cited that demonstrate the poor outcomes the US medical system has compared to many other countries with government run health care. As for Medicare, it is one government program that works remarkably well and has far lower administrative costs than private insurers. One of the reasons that it costs so much is that Congress, in it's infinite toadying to the pharmaceutical lobby, has banned Medicare from negotiating drug costs.

      January 12, 2013 at 8:02 pm |
  4. Alvin, messiah of The Church Of Cash


    There is an astounding opportunity in this! If corporations are judged to be religious and able to use that religion to ignore laws, the I am going to start a religion that has all sorts of corporate benefits!


    God spoke to me! He said the WORST SIN is for corporations or people making more than $250,000 a year to pay taxes!

    It is an unconscionable sin against God to let workers work less than 120 hours a week, and to be paid more than half of minimum wage!

    God spoke again, and said it is absolutely against His word that corporations and corporate officers ever be arrested or sued, no matter what the crime is!

    There will be more revelation I am sure, but YOU WERE THERE when the Church Of Cash received it's holy revelation!

    Corporations who wish to embrace this holiness may join by sending me $100,000 a month. I am, of course, incorporated.

    January 12, 2013 at 7:04 pm |
    • almost lol

      lot of effort to not be funny 🙂

      January 12, 2013 at 7:05 pm |
  5. John P. Tarver

    A Tax must originate in the House.

    January 12, 2013 at 7:04 pm |
    • Really now

      It's a fine, dumbshit.

      January 12, 2013 at 7:05 pm |
  6. are122

    So why aren't we charging all the politicians and unions that bowed out a $1.3 million a day fine??

    January 12, 2013 at 7:03 pm |
    • Ron D-

      All politicians in D.C. are members of the A.C.A.

      January 12, 2013 at 7:05 pm |
  7. John P. Tarver

    Wise up and pay the Tax, so you can take them to Court.

    January 12, 2013 at 7:03 pm |
  8. Kay

    to Silverglass

    I was not talking about medical coverage. Not sure how you misunderstood, but that's ok.

    January 12, 2013 at 7:02 pm |
  9. js

    If there really was a God- he would have destroyed the United Stupidity of SCAMerica by now. The stupidity of this country is overwhelming. There is no turning back now. America will die sooner than later. From the most corrupt, narcissistic President in history to the most incompetent (also corrupt) Government in history to a social media, brainwashed, spoiled, brain-dead population- there is no hope for this – what is now one of the world's worst countries and only getting worse.

    January 12, 2013 at 7:02 pm |
    • sxwalsh55

      Feel free to leave, and don't let the door hit in the a$$ on the way out!

      January 12, 2013 at 7:06 pm |
    • erin111

      George Bush is your hero, right? This is what you support! I agree with one of your thesis, if someone like you can publish so much nonsense, this country really is in trouble!!!

      January 12, 2013 at 7:13 pm |
    • jake

      so, when are you leaving? i'll help you pack and drive you to the airport..........

      January 12, 2013 at 7:13 pm |
    • lannistercurator

      and you believe in fairy tales of a 2000 year old book rewritten hundred of times by man. Aren't you a little old for fairy tales?

      January 12, 2013 at 7:18 pm |
  10. Gary

    More BS from Communist Obama and his Loony Left comrades. The sheeple that re-elected Obama are going to be sorry!

    January 12, 2013 at 7:01 pm |
    • Peter

      Looney? Let me tell YOU what is looney.

      If I am Jewish and work for Hobby Lobby why should I be denied my legal rights?

      And the Catholics who work there? If they are good Catholics, they won't accept the coverage, right? Right?

      January 12, 2013 at 7:07 pm |
    • sxwalsh55

      What's it like going through life blind to the world around you?

      January 12, 2013 at 7:07 pm |
    • Deb

      i'm thinking maybe the looney party is you. Just because you don't like Obama, doesn't give you the right to lie. Just as if I worked for Hobby Lobby, is it right for them to not pay for my medical care.. I wouldn't want an abortion, or the morning after pill... but they should have to pay for the Pill, or whatever mode of birth control I choose... The owner is just trying to pay less for his employees and steal more for himself.... I will not shop there again either if they do this.

      January 12, 2013 at 7:17 pm |
  11. THX1953

    If they have to by your Pill then they should spring for my Condom.

    January 12, 2013 at 7:01 pm |
    • spring for your condom?

      why spring for one when you have nothing to put in it and no one to use it with?

      January 12, 2013 at 7:04 pm |
    • Really now

      I do wish someone had spung for a condom for your dad.

      January 12, 2013 at 7:07 pm |
  12. nitrous

    If you middle-Americans could get it through your in-bred skulls that there is no god – this wouldn't be an issue.

    January 12, 2013 at 7:01 pm |
    • are122

      Perhaps some realize the physics controlling the universe could not have evolved from Darwin.

      January 12, 2013 at 7:02 pm |
    • Gary

      Spoken like a true LOONY LEFT MORON!

      January 12, 2013 at 7:02 pm |
    • sxwalsh55

      I love the ignorant responses you got to this post already. A bunch of hicks that stand in church chanting how they are literally sheep of the flock, and they want to argue against physics! Ha! This country will never be free until the Christian Jihad is put to pasture.

      January 12, 2013 at 7:13 pm |
    • pivotman

      Religion is mankind's greatest catastrophe. The radical right "god, guns and greed" mentality is far more destructive than most people realize.

      January 12, 2013 at 7:14 pm |
    • lol right wingers

      Yes, because the argument is that physics 'evolved' along darwinian lines. Some of the ignorance you right wing religious nutjobs spout is just completely unreal.

      January 12, 2013 at 7:19 pm |
  13. happyfrenchman

    I have shopped at Hobby Lobby before... I like their store.... I had some pictures framed, bought craft items, ....but if they make their holyness an issue, I will be at Michaels.... Done with them.

    January 12, 2013 at 7:00 pm |
  14. John P. Tarver

    Once a tax is paid it cn be challenged.

    January 12, 2013 at 7:00 pm |
  15. DKS

    Once again folks, the answer is universal heathcare. A person's health, and the choices he or she makes, has no business being tied to employment.

    January 12, 2013 at 7:00 pm |
    • SciGuy

      What is the question, Alex?

      January 12, 2013 at 7:01 pm |
  16. Ben In Ohio

    To those who support Hobby Lobby's position: if a Jehovah's Witness provides health insurance to his employees, does he get to deny coverage for blood transfusions?

    My religion recognizes that the earth can only sustain so many human beings. I'm not advocating genocide but I do suport the availability of all forms of birth control. Does my employer's "right" to decide my health insurance coverage trump my faith?

    My unvarnished view: I'm sick of this bogus argument that cherry picking coverage is an exercise of religious freedom. This is simply the same old crap of the rich and powerful (employers) wielding their power and religious views over others.

    January 12, 2013 at 6:59 pm |
    • independant jim

      I agree the law is the law for me and everyone else .. if i dont want birth control i dont have to use a contraceptive ..nothing in this law makes it mandatory for all to practice birth control ..it is a private choice not the governments and not hobby lobbys.. pay the fine and dont make me part of your religion.. im sure your god will forgive hobby lobby for obeying the law

      January 12, 2013 at 7:07 pm |
    • drk

      The Jehovah's Witness would at least be dealing in the realm of fact–a blood transfusion is a blood transfusion. Hobby Lobby and the far right wing Christian crowd have invented abortions that don't exist as a result of CONTRACEPTIVES. The required contraceptives are NOT abortificants.

      January 12, 2013 at 7:09 pm |
  17. DC1973

    This is what I love about most Christians. The "my way is the *only* right way" thing.

    They don't realize that the rest of the world is just as convinced they're right. Or that millions of people's belief systems are thousands of years older. Or that not even all branches of Christianity believe the same thing. Or that the odds of they way being the "one and only" answer are too tiny to even count.

    The lack of self-awareness in that kind of thinking is astounding, really.

    January 12, 2013 at 6:59 pm |
  18. akismet-68f9afc29cb829d1b89f71b63bff8bd9

    simple solution, make everyone part time, we will see the employment rate dropping, because full time menial jobs will be disappearing.

    January 12, 2013 at 6:59 pm |
  19. Jason

    Simple solution for all employers.
    Stop offering health insurance to your employees.
    Pay a decent wage and let each employee buy their own individual policy.
    If every company did this – problem solved and obamacare bites the dust.

    January 12, 2013 at 6:58 pm |
    • Rose

      Good idea, Jason.

      January 12, 2013 at 7:09 pm |
  20. Susan

    This is a corporation. Corporations don't have religious beliefs.

    January 12, 2013 at 6:58 pm |
    • Gary

      If you believe that, I truly pity your STUPIDITY!

      January 12, 2013 at 7:04 pm |
    • Ron D-

      Don't forget that a Corporation is a PERSON! Crazy, isn't it?

      January 12, 2013 at 7:07 pm |
    • Mark V

      Actually they are privately owned, which you might have noticed if you had bothered to read more than the headline. The owner does not feel that he can support something based on his religious beliefs, and while I am Agnostic for the most part, I support his right to do so. If his employees feel strongly against his beliefs, they are free to work elsewhere.

      The government is FORCING a privately held business to choose between their religious beliefs or going out of business due to fines. I'm pretty sure that is the complete opposite of religious freedom, a basic tenet our country was founded on.

      January 12, 2013 at 7:12 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.