Repost? Stupid mobile site...
In this case, the law was blocks because going through the process of opting out of contraceptive coverage for a group of nuns was against their religion. The nuns essentially claimed they could not comply with the government's view of due process. This due process seems well within recognized limits to the church-state separation. I doubt it will be upheld. If the argument is that your religion compels you to not do paperwork, you're probably being ridiculous.
And all these Sebilius cases represent a pretty terribad slippery slope. The next logical exception for religious institutions could be for their health coverage to not cover pregnant single mothers, because the church views pregnant single mothers as amoral.
The whole thing sounds like a heap of administrative weight that will just drive health costs up for everyone. Individual members of a church pay sales tax, which can be theoretically funneled into state contraceptive programs. Religious institutions that pay taxes may have their taxes put to similar use. Since SCOTUS has already decided the Individual Mandate is a tax, the compulsory terms of health insurance should/could be regarded in the same way.
If this is allowed to stand, as a cultural Christian with a fierce hatred of the way health insurance was administered prior to the ACA (and who is currently not impressed with the progress of implementing the ACA), I hope that there is an opt-out fee that is equal to or greater than the fee for contraceptive coverage.