U.S. Supreme Court Justice Clarence Thomas/photo by Diego Radzinschi/NLJ

The Trump administration had legal authority to allow private employers with moral or religious objections to opt out of providing birth control health insurance required under the Affordable Care Act, the U.S. Supreme Court ruled on Wednesday.

"We hold today that the departments had the statutory authority to craft that [religious] exemption, as well as the contemporaneously issued moral exemption," Justice Clarence Thomas wrote for a 7-2 majority. "We further hold that the rules promulgating these exemptions are free from procedural defects."

Justice Ruth Bader Ginsburg, joined by Justice Sonia Sotomayor, dissented.

"In accommodating claims of religious freedom, this court has taken a balanced approach, one that does not allow the religious beliefs of some to overwhelm the rights and interests of others who do not share those beliefs," Ginsburg wrote. "Today, for the first time, the court casts totally aside countervailing rights and interests in its zeal to secure religious rights to the nth degree."

Justice Elena Kagan, joined by Justice Stephen Breyer, concurred in the majority's result but not its reasoning.

The court's decision marked the third time the justices have considered the contraceptive insurance requirement since the federal law was enacted in 2010. The government estimates that under the Trump administration's expanded exemptions between 70,500 and 126,400 women would lose access to cost-free birth control in one year.

This latest dispute centered on the administration's 2017 effort to grant categorical exemptions, sometimes called the "conscience exemptions," to for-profit and nonprofit employers. The Obama administration had created narrower exemptions for churches and other houses of worship, and offered "accommodations" for religiously affiliated organizations, such as hospitals and universities, by which they would not directly contribute to the cost of the insurance.

In the combined cases Little Sisters of the Poor v. Pennsylvania and Trump v. Pennsylvania, the states of Pennsylvania and New Jersey challenged the Trump exemptions, arguing that they were not authorized—as claimed by the administration—by the Affordable Care Act and the Religious Freedom Restoration Act.

The states also argued that the Trump administration violated the federal Administrative Procedure Act when it issued the first interim rules in 2017 expanding the exemptions without first providing notice and an opportunity for public comment. That violation, they argued, made the final rules in 2018 invalid. The U.S. Court of Appeals for the Third Circuit ruled in favor of the states and upheld a nationwide injunction against their enforcement.

During telephonic arguments in May, U.S. Solicitor General Noel Francisco, defending the Trump administration, countered, "There is nothing in the ACA" that requires contraceptive coverage. The Obama administration's signature health care law delegates to the enforcing agencies the decision whether to provide it, he said.

The administration, in its appeal, also had asked the justices to weigh in on the appropriateness of nationwide injunctions. The court did not reach that issue in Wednesday's ruling.

Challenging the administration's exemptions, Pennsylvania Chief Deputy Attorney General Michael Fischer argued that "the moral and religious exemptions rest on sweeping claims of authority." He said they would allow any employer to opt out entirely from providing the coverage, including for "vaguely defined moral beliefs."

The prior rules, Fischer said, struck a balance. "This case is not the result of a long-running dispute but an extension of authority inconsistent with Congress and the courts," he argued.

Chief Justice John Roberts Jr. and Justice Stephen Breyer voiced frustration that the contraceptive insurance issue was before them once again.

"Well, the problem is neither side in this debate wants the accommodation to work," Roberts said at one point. "Is it really the case that there's no way to resolve those differences?"

The point of the Constitution's religion clauses is "to try to work out accommodations," said Breyer. "I don't understand why this can't be worked out."

But Ginsburg, in a comment to Kirkland & Ellis' Paul Clement, representing Little Sisters, stated, "At the end of the day, the government is throwing to the winds women's entitlement  to seamless, no cost to them, contraceptive coverage. This idea that the balance has to be all for Little Sister-type organizations and not at all for women seems to rub against our history of accommodation, tolerance and respect for divergent views."

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This is a developing report and will be updated.