WASHINGTON (CNS) — When it comes to issues of religious freedom, Bill Donohue thinks the Obama administration has put religious employers between a rock and a hard place.

Commenting on the Department of Health and Human Services’ Aug. 1 announcement that contraceptives and sterilization will be among the mandated preventive services for women under the new health reform law, the president of the Catholic League for Religious and Civil Rights recalled that as a presidential candidate, Barack Obama said faith-based programs that receive government aid should not be allowed to hire only members of their own faith.

“If you get a federal grant, you can’t use that grant money to proselytize to the people you help and you can’t discriminate against them — or against the people you hire — on the basis of their religion,” Obama said in a July 1, 2008, speech in Zanesville, Ohio.

Now, HHS is proposing that only religious employers meeting four criteria would be exempt from providing contraceptives and female sterilization through their health plans. Those requirements are that the organization “(1) has the inculcation of religious values as its purpose; (2) primarily employs persons who share its religious tenets; (3) primarily serves persons who share its religious tenets; and (4) is a nonprofit organization” under specific sections of the Internal Revenue Code.

“In other words, the Obama administration is playing Catch-22 with religious employers,” Donohue said. “If they are too religious, Catholic social service agencies risk losing federal funds, but if Catholic hospitals are not sufficiently religious, they cannot be exempt from carrying health insurance policies that transgress their religious tenets.” The announcement of the narrow “religious exemption” proposed by HHS — and subject to a 60-day comment period — has drawn strong criticism not only from those known to oppose Obama and his health reform law.