Alex Brandon, File, Associated Press
In this March 23 file photo, flags and signs are held during a rally for religious freedom organized in part by the Catholic Archdiocese of Philadelphia in front of Independence Hall. The rally was in objection to the Health and Human Service mandate that private health care cover women's contraception.

After laying low for several weeks, the percolating dispute between Catholics and the Obama administration crossed two key milestones in the last seven days.

On Wednesday, the HHS mandate requiring insurance companies to provide free contraceptive services that include controversial abortion-inducing drugs went into effect. The other milestone came Friday, when a key court decision in Colorado cast doubt on the mandate’s long-term survival.

As part of the Affordable Care Act, Congress had empowered the Health and Human Services Department to determine what "preventive care" would be required to be provided without copay under approved plans. HHS subsequently decided to include sweeping contraceptive services in this requirement.

Catholic organizations and leaders vigorously opposed the mandate, claiming it would force them to abandon their consciences or drop health care coverage for employees. The Obama administration, however, refused to compromise, offering only a one-year extension on the compliance deadline.

The implementation deadline that passed Wednesday will not immediately affect the religious schools, hospitals and other charities contesting the regulation, since the Obama administration granted a one-year "safe harbor" extension to such groups to reach compliance.

And on July 18, a federal judge ruled that the legal challenge brought by Belmont Abbey College in North Carolina was not "ripe" because the Obama administration was working on some complex adjustments to the rule that HHS believes may limit the burden on conscience.

Because HHS has formally announced it may revise the rule, “the court held that the case could not be decided right now,” said Hannah Smith, senior counsel at the Becket Fund for Religious Liberty. But Smith stressed that the judge had dismissed the case “without prejudice,” and that Becket and Belmont Abbey would be back.

There were no such procedural limits in Colorado, where the Alliance Defending Freedom, a conservative public interest law firm, won a preliminary injunction for Hercules Industries, a family-owned corporation run by devout Catholics that would not be protected under any exemptions offered by the Obama administration.

The Hercules case is significant because until now the mandate exemption debate centered on nonprofit charities run by religious organizations. That debate hinged on how and whether to protect a religious organization operating in the public sphere, noted Matt Bowman, who spearheaded the Hercules case for ADF.

Bowman said the administration had “run into a brick wall of religious freedom which in America cannot be sliced up into pieces by Washington bureaucrats.” While the decision on Friday was preliminary, Bowman notes that in reaching it the judge carefully addressed the likelihood of the plaintiff “prevailing on the merits.”

The hurdle facing HHS is the Religious Freedom Restoration Act of 1993, Bowman said. RFRA requires that the federal government clear the “highest hurdles” before it can restrict religious freedom, including demonstrating a “compelling state interest” and using the “least restrictive means,” while exhausting any other alternatives.

“Supreme court case law is very clear that religious freedom is so important that the government can’t pick and choose a variety of exemptions, and then turn around and single out those who object based on faith,” Bowman added.

Because Hercules had made significant changes to its health plan after the deadline, it fell out of the grandfathering protections. An estimated 190 million Americans are exempt from the contraceptive mandate through grandfathered plans. HHS expects 69 percent of these to drop out by 2013.

In oral arguments the previous week, Bowman argued that the “government does require grandfathered plans for these tens of millions of women to do a variety of things. They can't exclude people because of preexisting conditions. They have to include dependents up to age 26. They can't impose lifetime spending limits. These are all interests that Congress decided were important enough to impose on grandfathered plans.”

Among those grandfathered is the Deseret Mutual insurance, still known commonly as DMBA, provided by The Church of Jesus Christ of Latter-day Saints to its employees, including its colleges and universities.

“Currently our employee plans are grandfathered, so these new requirements don’t apply to us,” said David Call, vice president at DMBA. “Since we are not changing our employee plans, the existing plan is grandfathered in.”

Call said DMBA is not planning on making any changes that will require them to enact the new requirements. “With the uncertainty of the future, we will watch to see what happens,” he said.

In the Hercules case, Bowman argued that by grandfathering and exempting millions of people from the mandate, “the administration admitted that it is not a compelling state interest.”

Judge John L. Kane seemed to concur. In his preliminary injunction, Kane noted the 190 million Americans grandfathered or exempt from the mandate and indicated those exemptions cast doubt on the compelling state interest justification for the mandate.

This was not the only note of skepticism Kane offered toward the government case. As Carrie Severino noted at National Review, Kane doubted whether the government had tried less burdensome approaches: “For example, if free contraceptive coverage were so important, the government could simply expand the programs it currently runs to provide contraceptives to all women instead of only low-income women.”

Severino also noted Kane’s skepticism about the government’s general posture toward religion, observing that the judge “held that the asserted government interest in the health of women and children is ‘countered, and indeed outweighed, by the public interest in the free exercise of religion.’”

Kane characterized the government's position as holding that “a for-profit, secular employer" such as Hercules "cannot engage in an exercise of religion.” This question seemed to intrigue the judge, and according to John G. Malcolm and Dominique Ludvigson at the Heritage Foundation, much hinges on it.

“Under that logic,” Malcom and Ludvigson wrote, “if the government decided to require any business that served or prepared food to offer pork, kosher or halal butchers would be forced to forgo their most deeply held religious convictions in order to stay in business. Accepting the government’s position would effectively push religion out of every sphere of public life and restrict the free exercise rights of adherents to live out their faiths in their day-to-day lives.”

Eric Schulzke writes on national politics for the Deseret News. He can be contacted at [email protected].

Joseph Walker contributed to this story.