The Denver-based Little Sisters of the Poor, who sued to avoid complying with the Obamacare contraception mandate, lost Tuesday in the 10th Circuit Court of Appeals, which ruled it must allow employees to have contraception coverage.

Little Sisters challenged the process it must follow to get out from under the contraception mandate but failed, the court decided, to show a substantial burden on the exercise of its religion.

The Affordable Care Act requires employers who provide health insurance coverage to include benefits for preventive care, including contraception, without cost to their insured employees.

The federal government adopted a regulation that exempts religious employers, such as churches, hospitals, universities, charities and other service providers such as the Little Sisters of the Poor, from covering contraceptives they oppose on religious grounds. However, these groups must actively seek an exemption. A third party then steps in to cover contraceptives for employees.

Little Sisters of the Poor is a Catholic order that runs about 30 nursing homes around the country, including one in Denver. The organization and four Christian universities in Oklahoma were represented by The Becket Fund for Religious Liberty. They argued that being forced to file for the exemption made them part of “the scheme” to provide their employees access to contraceptives.

The three-judge appellate panel focused its questions during oral arguments in December in Denver on whether requiring the Little Sisters and universities to actively opt out of contraception coverage created a substantial burden for the groups. The court Tuesday ruled it does not.

The court said the sisters must provide the health benefit, or actively apply for the exemption or pay IRS penalties.

The court rejected the claim that complying with the law makes them “complicit” in delivery of contraception.

The Little Sisters’ attorneys said they are reviewing the court’s decision and considering whether to seek relief from the Supreme Court.

Last year, the Supreme Court ruled 5-4 in favor of Hobby Lobby, a closely held, family-owned corporation that argued providing contraception coverage for its workers violated its religious beliefs.

The court ruled that corporations controlled by religious families cannot be required to pay for contraception coverage for their workers.

Electa Draper: 303-954-1276, edraper@denverpost.com or twitter.com/electadraper