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. Scottish Mama

    Choice something I can believe in.

    January 13, 2013 at 8:15 pm |
  2. Scottish Mama

    An ind

    January 13, 2013 at 8:14 pm |
  3. Free Man in the Republic of Texas


    "you HAVE TO pass the bill to find out what's in it!"

    "Get OVER your conscience !!!"

    "You have ONE year."

    January 13, 2013 at 7:59 pm |
    • Scottish Mama

      meaning you have to wait to see what the republicans do to butcher it.

      January 13, 2013 at 8:05 pm |
    • Dan

      Your opinion and I certainly believe you have a right to your opinion. No matter what.I actually respect your right to that opinion and would never call you names as some people do on these post. However no matter how it was passed It remains THE LAW

      January 13, 2013 at 8:10 pm |
  4. mark

    I have the upmost respect for Hobby Lobby and only disgust for most of the posters here. Right On Hobby Lobby and Chik fille you will have my business. They do the right thing in life where you others do evil..prove me wrong if you can.

    January 13, 2013 at 7:57 pm |
    • Jen

      Chik fille – ha ha. I just proved you are stupid. Does that count?

      January 13, 2013 at 8:01 pm |
    • tony

      Belief in fantasy, then using that as an excuse to harm others is evil. Period.

      January 13, 2013 at 8:04 pm |
    • Tom, Tom, the Piper's Son

      "upmost." I just proved your ignorance as well. I am tied with Jen!

      January 13, 2013 at 8:06 pm |
    • Jen

      I found another one below Tom Tom. This is fun!

      January 13, 2013 at 8:07 pm |
    • Tom, Tom, the Piper's Son

      OOOhhh! Where, Jen?

      January 13, 2013 at 8:15 pm |
    • Tom, Tom, the Piper's Son

      Never mind-I see it. Marky isn't exactly the sharpest crayon in the box, is he?

      January 13, 2013 at 8:16 pm |
  5. tracy

    The lord, also said render to Cesear what is due! Obamacare has paved a way for every citizen of this country to have health coverage and there should be nothing wrong about it! Every company in violation of failing to adhere to the law should pay. When slavery was permitted as law,many companies supported it and some companies failed to speak about religious and what the bible opposes in regards to treating others as you would like to be treated! So it serves right for tiff penalties and fines to be imposed when companies fail to adhere to the law.

    January 13, 2013 at 7:55 pm |
    • mark

      you preach at your own risk about one you do not yet know.

      January 13, 2013 at 7:59 pm |
    • Dan

      Very Well Put

      January 13, 2013 at 8:06 pm |
    • tony

      Oh M@Mark. That's a threat, a religious threat, and a threat made by you on behalf of the god you worship. That's blasphemy. Apparently you seem to have alsoforgotten that "Vengence is mine, sayeth the Lord", which puts you at odds with god for a second time.

      January 13, 2013 at 8:08 pm |
    • Peter

      The actual scripture says render unto Caesar that which belongs to Caesar and render unto God that which belongs to God. The federal government doesn’t create human life. If you want to know what the Bible really says about “the state” and Caesar, go over to the Book of Revelation.

      January 14, 2013 at 10:03 am |
  6. marn7271

    I agree, Brad

    January 13, 2013 at 7:47 pm |
  7. NotFooledByDistractions

    there's nothing more disingenuous or offensive than overplaying the religion card.

    January 13, 2013 at 7:46 pm |
    • mark

      you speak about something you no nothing about...but you can if you come to Jesus.

      January 13, 2013 at 8:00 pm |
    • Jen

      Know not no. Yikes!

      January 13, 2013 at 8:06 pm |
    • Gir

      @ Mark Knowing something about religion is the best reason to stay AWAY from it.

      January 13, 2013 at 8:07 pm |
  8. Brad

    HL should just hire men only...women should stay home and obey. So it is written.

    January 13, 2013 at 7:42 pm |
  9. Laura

    No one, as an individual or a business, should be REQUIRED to provide health insurance to their employees. A private business organization is just that – PRIVATE, meaning it alone has the right to choose what benefits are provided to employees. If you don't like it, then work elsewhere. I know, I know...I am just waiting for the response that "times are tough" and "jobs are hard to find." Boo hoo, quite frankly. I know several people who have lost their jobs over the last few years and they all find suitable employment within a reasonable time because they didn't sit around all day surfing the Internet for jobs – they actually went out (one person actually handed out resumes office to office) and made something happen. If a company doesn't believe in certain medical procedures, then it shouldn't be required to pay for them. If you worked for a small company that didn't fall under the mandates, then you wouldn't necessarily be getting health insurance – does that make it a bad company?

    January 13, 2013 at 7:34 pm |
    • hanson

      Maybe the should and maybe they shouldn't I dont feel thats the debate. The law says they must or face the consequences. That part is pretty simple. Its not whether the law is just or not. If the law is wrong then change it if you can. How ever it boils down to that it IS the law

      January 13, 2013 at 7:49 pm |
    • Tom, Tom, the Piper's Son

      Laura, you can believe that all you want, but the law says otherwise. If you don't like it, you can attempt to get it changed, but pretending that your opinion is law is stupid.

      January 13, 2013 at 8:14 pm |
    • Pirate65

      Yes. It is a bad company. They need to follow the law. I'll bet you wear your hair in a bouffant bun, don't you?

      January 13, 2013 at 8:15 pm |
  10. reasonablebe

    If this is allowed– avoidance of required coverage, based upon assertions of employer's religious belief for employees of a non-religious business/secular business, the what is to prevent a biz owner who is Johovah's witness or some other religious group that does not permit any medical intervention or treatment or presrciption or other medical drug use (anti-biotics, anesthesia, whatever) from asserting its claim of right to deny medical insurance completely???

    the courts have consistently ruled that, other than church or religious organization, employers cannot impose their religious beliefs on employees- and even for such a religious employer, only on those in a substantially religious function, not those providing non-religious functions or for profit functions.

    January 13, 2013 at 7:01 pm |
    • Laura

      Hobby Lobby is not imposing its beliefs on anyone. It's not like the company forbids its employees from using contraceptives or having abortions – it just doesn't want to directly pay for them or condone them.

      January 13, 2013 at 7:41 pm |
    • manycatsonekid

      Sorry, but unless their business IS religion, hiring only from within whatever sect they belong to and doing business only with other in that sect, they lose that claim of "religious protection". They sell to people of all faiths, including those who believe in the Flying Spaghetti Monster, Krishna or no deity at all, so the idea that they can't comply with the rules of all faiths is B S. It's worse when they start claiming to be all tolerant yet continue to be intolerant.

      January 13, 2013 at 8:11 pm |
  11. The Film Professor

    I don't think people should smoke cigarettes. Should I have a right to refuse to cover lung cancer in our health insurance plan?

    Of course not.

    January 13, 2013 at 7:00 pm |
    • reasonablebe

      exactly.... unless you believe in anarchy, general rules must apply to all.

      January 13, 2013 at 7:03 pm |
    • gdouglaso

      As an employer, if you have a policy against hiring people who smoke so that your overall premiums are lower you could do this. I think we need to be more market oriented here...people will decide who they work for long term. Keep in mind that there are millions of part-time and contract workers who are not covered at all by their employers...and right now some employers keep the hours of some down so that they do not have to pay full-time benefits. There is nothing illegal about that.

      January 13, 2013 at 7:17 pm |
    • manycatsonekid

      @ gdouglaso–but it IS unethical and that is just as bad, if not WORSE.

      January 13, 2013 at 8:13 pm |
  12. spiritscript

    HL should be exempt from proving ins. for bc. IMO, HL is using the christian card to save money aka greed! Pathetic! So much for "love thy neighbor."

    January 13, 2013 at 6:56 pm |
    • spiritscript

      IMO, HL is using the christian card to save money aka greed! Pathetic! So much for "love thy neighbor."

      January 13, 2013 at 7:00 pm |
    • gdouglaso

      I think you have to be fair here though. They have been playing the Christian card for a long time before this (i.e., this is not some covert attempt to bring up religion to skirt the law). I do not see how declining a given aspect that violates their relies opinion is not showing love for their neighbor...of course, I am not sure what your neighbors are like and whether you need birth control when you are around them.

      January 13, 2013 at 7:20 pm |
  13. MN

    Congradutions HOBBY LOBBY for standing up to your religious beliefs! We are proud of you and I would do the same if I had a business! God is on your side and you will be blessed!

    Obama thinks he is God and can do anything he pleases. Well, I have news for him.....he is not God!....it's so laughable....those thugs from Chicago......that's all they are, THUGS!

    January 13, 2013 at 6:55 pm |
  14. Jeff

    There is an easy solution. If YOU don't like Hobby Lobby's stance on religion or abortion then don't shop there and don't fill out an application to work there. If I create a business and I want to close on Mondays because I like Monday Night Football, oh well find another job.

    January 13, 2013 at 6:43 pm |
    • Tom, Tom, the Piper's Son

      Too bad you don't sit on the bench of the SCOTUS, you brilliant legal scholar.

      January 13, 2013 at 7:04 pm |
    • Scottish Mama

      If you do not like paying union dues you should not work in a union shop either. I you want to vote you should not have to have a picture, but you do have to and only 96 people were caught out of millions. What could be the reason? Republicans want to limit votes and break unions for the almighty win of elections and the almighty dollar.

      January 13, 2013 at 8:11 pm |
  15. Eric

    Hobby Lobby's problem is that their employees may use the health benefits that they are provided with in order to obtain abortions. The problem with their outrage is that their employees would still be able to use paychecks in order to purchase abortions. Either way the result is the same, HL is providing incentives to employees and it is up to the employees whether or not to use the incentives for an abortion.

    January 13, 2013 at 6:33 pm |
    • manycatsonekid

      Ah! There is the point in a nutshell. HL contracted a particular insurance provider knowing what was covered and what was not. Their employees pay their portion of the cost in order to have what has been contracted. If the EMPLOYEE chooses to use the insurance as contracted for and provided, HL cannot come back and claim "unfair!"

      January 13, 2013 at 8:18 pm |
  16. Kevin, Kevin The Baker's Aunt

    Hobby Lobby is a great place to meet women.

    January 13, 2013 at 6:24 pm |
    • Zingo

      It sure is! Big women! Very very big women. Flatulent. Diplomas from junior high. Cream of the crop.

      January 13, 2013 at 6:29 pm |
    • Pirate65

      Yeah, if you like women wearing skirts with white tennis shoes,who wear their hair (which can never be cut – I guess bangs don't count!) in an outdated poofy bun piled on top of their empty heads. I swear that's what causes them to go into convulsions and speak "in tongues" in their churches. It's the heavy hair!

      January 13, 2013 at 8:20 pm |
  17. Renee

    Why doesn't Hobby Lobby just get real about it and refuse to hire women?

    January 13, 2013 at 6:15 pm |
  18. Ed T Duck

    Tom, Tom, the Piper's Son: Try to think a little harder before calling people idiots. It really backfires on you.

    January 13, 2013 at 6:15 pm |
    • Ed T Duck

      Ah, the kind of mature response I expected from you.

      January 13, 2013 at 6:50 pm |
    • Tom, Tom, the Piper's Son

      It's what you deserve.

      January 13, 2013 at 7:05 pm |
  19. called research

    Stop imposing your god on me. there are hundreds of gods that have existed on Earth.
    I wish Congress was exempt from Obamacare but reality says otherwise.
    Sean Hannity is the king of lies.
    I will celebrate the day when people realize obama care is not an insurance program

    January 13, 2013 at 6:08 pm |
    • Jeff

      Then don't work there. If this country has a right to practice anyway it wants, then let them. If I don't like Hobby Lobby's stance on religion or abortion I won't shop there or work there. Seems pretty simple.

      January 13, 2013 at 6:42 pm |
  20. Yikes!

    Tom, Tom the Idiot's son is back . . . this person (?) truly is a nut job!

    January 13, 2013 at 6:06 pm |
    • Tom, Tom, the Piper's Son

      Oh, you poor little boy. DId I hurt your widdle feelings?

      January 13, 2013 at 6:45 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.