Seventeen states, led by Pennsylvania and New Jersey, challenged the policy as fundamentally unlawful and it's rationale as "arbitrary and capricious."
Justice Clarence Thomas, writing the majority opinion, concluded that a "plain reading" of the law gives the administration "virtually unbridled discretion" to decide what counts as required coverage and any religious and moral exemptions that may be necessary.
"No language in the statute itself even hints that Congress intended that contraception should or must be covered," Thomas writes. "It was Congress, not the [administration], that declined to expressly require contraceptive coverage in the ACA itself."
Kagan made clear, however, that the fight over the exemptions may not be over. While the administration has the right to change the policy, she said, "I question whether the exemptions can survive administrative law's demand for reasoned decisionmaking. That issue remains open for the lower courts to address."
The Administrative Procedure Act requires federal agencies to consider their impact of regulations and provide a public rationale for changes to the law. The courts did not fully examine whether HHS complied in this case.
Justices Ruth Bader Ginsburg and Sonia Sotomayor dissented, saying the court's ruling "leaves women workers to fend for themselves."
"As the government estimates, between 70,500 and 126,400 women would immediately lose access to no-cost contraceptive services" under the judgment, Ginsburg wrote.
Expanded contraceptive services coverage under the ACA has had a sweeping impact say women's health advocates. The benefit saved women an estimated $1.4 billion on birth control pills in 2013 alone, according to the National Women's Law Center. Increased access has also been credited with reducing abortion rates nationwide.
“Contraception should not be singled out from the rest of health insurance coverage," said Lourdes Rivera, senior vice president at the Center for Reproductive Rights. "Today’s ruling has given bosses the power to dictate how their employees can and cannot use their health insurance—allowing them to intrude into their employees’ private decisions based on whatever personal beliefs their employers happen to hold."
Conservatives hailed the decision as a resounding win for religious liberty and the Little Sisters of the Poor, a Catholic religious nonprofit that operates homes for the elderly in several states that has been fighting the ACA policy.
"The Court’s decision today upholding that exemption is a victory for freedom of religion and conscience," tweeted Frank Scaturro, vice president and senior counsel at Judicial Crisis Network, a conservative legal advocacy group.
"It is outrageous that the Obama administration forced a group of nuns to violate their religious beliefs in the first place," he said.
The court's decision is the third to address the contraceptive mandate. In 2014, the justices ruled that "closely held for-profit businesses" can raise religious objections and be exempt. The narrow decision did not address a more sweeping approach adopted by Trump.
White House press secretary Kayleigh Mcenany said today's ruling "vindicated the conscience rights of people of faith" adding that the president has tried to strike a balance.
"We are allowing women who lack access to contraceptive coverage because of their employer’s religious beliefs or moral convictions to more easily access such care through the Title X program at little to no cost," Mcenany said in a statement. "Ensuring that women receive the healthcare they need does not require banishing religious groups that refuse to surrender their beliefs from the public square."
Marjorie Dannenfelser, president of the Susan B. Anthony List, an anti-abortion group, called it a "major victory for President Trump." "We hope today’s victory at the Supreme Court will finally allow the Little Sisters to carry out their mission to love and serve the elderly poor without having to violate their conscience."
The decision comes as the Trump administration seeks to more fully dismantle the Affordable Care Act. Later this year, the administration and a group of 20 Republican-led states will ask the court to strike down the law in its entirety, calling it unconstitutional. Despite promises to present a viable alternative health care plan, President Trump has not yet done so.
House Speaker Nancy Pelosi, D-Calif., a staunch defender of the ACA, blasted the court's ruling on contraception coverage as a "brutal assault on women's health, financial security and independence."
"The Affordable Care Act was explicitly designed to prevent discrimination against women and to ensure that women have access to preventive care, including contraception," she said. Pelosi did not address why Congress in 2010 did not explicitly articulate those protections in the law itself.
“Fortunately, the disastrous regulations that the Court upheld today can be reversed by a new president," said Reps. Jerry Nadler, D-N.Y., and Steve Cohen, D-Tenn. "They also can and should be reversed right now by Congress through the Protect Access to Birth Control Act," Democratic legislation that would reverse the Trump administration's employer exemptions.
The Republican-controlled Senate has shown no willingness to take up such a bill.
"No one should be forced to violate their deeply-held religious beliefs due to a government mandate," tweeted Sen. Mike Rounds, R-S.D. "Great day for religious liberty!"
This report was featured in the Thursday, July 9, 2020, episode of “Start Here,” ABC News’ daily news podcast.
"Start Here" offers a straightforward look at the day's top stories in 20 minutes. Listen for free every weekday on Apple Podcasts, Google Podcasts, Spotify, the ABC News app or wherever you get your podcasts.