You go to work and get paid. You can spend your money on whatever you want. Even if you work at a Catholic hospital, you can take your paycheck and blow it on pentagrams, Sam Harris books, abortions, or a hamburger on a Lenten Friday. No one claims it to be an affront to anyone's religious liberty if you do these things with your paycheck.
You earn a health insurance policy via your job. Should a religiously-affiliated company desire, that policy need not include contraception coverage. Under President Obama's proposed mandate, your insurance company must offer you a free option to cover contraception (which can be free for reasons discussed in Part 1), but Notre Dame isn't forced to sully itself by paying for contraception.
Just like you're free to use your paycheck on whatever you want without endangering anyone's immortal soul, so too can you make changes to your own health insurance policy without damning anyone. If you and your insurance company decide to modify your plan by adding contraception coverage, it's no business of your employer, who is not involved in the transaction any more than they are involved in your pentagram purchase.
One might point out that there are Catholic institutions which self-insure, as well as Catholic insurance companies. If you really wanted to be extra careful, you could tweak the proposed mandate by allowing these Catholic insurance companies to give their beneficiaries a voucher for the value of their girl-parts insurance (for pregnancy and such), which they could take to another insurer who would provide girl-part insurance which includes contraception. If some think that such accounting gimmicks might save their souls, I suppose we can accommodate them.
So no one's or religious freedom is endangered by Obama's proposal (or a similar proposal with only a very minor tweak on the accounting). Tomorrow we'll discuss that resistance to the proposal is really based in a desire to ban contraception altogether; that is, to ban you from spending your paycheck on contraception. Gotta give 'em credit for at least being internally consistent.