Aetna Inc. headquarters in Hartford, Connecticut. Photo: Michael Nagle/Bloomberg

Some employers in New York have been granted religious exemptions to the state's mandate on providing contraceptive coverage by insurance companies, despite not qualifying for that status, the state Department of Financial Services said Friday.

A handful of insurance companies will now pay a collective fine of $509,000 after allowing the exemption for more than 30 entities that were not religious in nature, including a wood floor refinisher, a chimney-cleaning service, a tax consultant and others.

The agency also issued a guidance Friday reminding insurers that final rules issued by a handful of federal agencies do not preempt the state's insurance law, which requires coverage for contraception in most cases. Acting DFS Superintendent Linda Lacewell said the agency will continue to monitor companies to ensure they're complying with the statute.

“New York's health insurers are on notice that DFS will take all actions necessary to protect healthcare consumers from insurers that fail to adhere to New York State's statutory and regulatory requirements, including for contraceptive coverage,” Lacewell said. “Today's guidance also serves as a strong reminder to New York-regulated insurers that recent federal rules regarding exemptions on the basis of religious beliefs do not preempt robust consumer protections provided by state law.”

An investigation by the agency found that 10 health insurance companies, including Aetna Inc. and Oxford Health Plans, improperly granted religious employer exemption requests to more than 30 entities that did not meet the requirements of the label. Oxford, according to DFS, granted the most exemptions to entities that were not religious employers.

A spokeswoman for Oxford, which is operated by UnitedHealthcare Inc., said the approvals were unintentional and that they would work with the state to ensure future compliance.

“We regret that we made this unintentional error that impacted some of our members and are working with the state to ensure compliance with religious employer exemption guidance going forward,” the spokeswoman said.

Representatives for Aetna did not immediately comment on the claims. The companies, along with the other alleged violators, signed consent orders with DFS to resolve the matter.

The insurers agreed to contact all members of insurance plans who should have received notice of the rider coverage and to pay restitution for the violations. Each entity was ordered to pay a different amount based on the extent of the claims against them.

They were also ordered to reimburse members who were denied coverage and therefore had to pay out of pocket for contraception. Going forward, they'll have to create a new review process for assessing future religious exemption requests to make sure they're not granting one to an employer that does not meet the definition under state law.

Companies are not allowed to self-certify themselves as eligible for a religious exemption, the agency said. In order to qualify, the business has to be a nonprofit that serves and employees people sharing its religious values with the purpose of impressing those ideas. In other words, they have to be a strictly religious organization.

A handful of federal agencies, last year, issued final rules that provided an exemption from the contraceptive coverage mandate in the Affordable Care Act, or Obamacare. That does not trounce the state's law mandating insurers to provide such coverage, the agency said Friday.

The other insurers accused of improperly granting religious exemptions included Crystal Run Health Plan LLC, Crystal Run Health Insurance Company Inc., Capital District Physicians' Health Plan Universal Benefits, HealthNow New York Inc., Independent Health Association Inc. and Independent Health Benefits Corp.

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