UPDATE 1-U.S. sets final contraceptives rule for faith-affiliated employers
(Recasts lead with legal challenge, adds quote, details and background)
WASHINGTON, June 28 (Reuters) - The Obama administration on Friday issued its final rule requiring health insurance coverage of contraceptives for the employees of religiously affiliated universities, hospitals and other institutions, just as the new policy faces mounting legal challenges.
Officials said the rule does not differ substantially from a proposed version released earlier this year that sought to insulate employers who oppose birth control on religious grounds. The final version calls for workers to receive separate payments for contraceptive services from their employers' insurers or third-party administrators.
"Today's announcement reinforces our commitment to respect the concerns of houses of worship and other non-profit religious organizations that object to contraceptive coverage, while helping to ensure that women get the care they need, regardless of where they work," U.S. Health and Human Services Secretary Kathleen Sebelius said in a statement.
The rule, which goes into effect on Aug. 1, follows months of protest and legal action by groups representing Roman Catholics, Protestant evangelicals and private employers who claim that President Barack Obama's 2010 Patient Protection and Affordable Care Act forces them to violate their own religious tenets against contraception.
It also comes a day after a federal appellate court in Denver ruled that one employer, arts and crafts chain Hobby Lobby, may be exempt from the requirement that Obama has insisted be made available for all employees with health insurance, particularly women, whose contraceptive options can be expensive.
(Reporting by David Morgan; Editing by Vicki Allen)