How will the Affordable Care Act affect churches?

Churches are considered employers and subject to the requirements of the PPACA law, like all other employers.

Since most churches have fewer than 50 full time employees, they will mostly be exempt from providing healthcare coverage for their employees.

In addition, churches (and ONLY the religion itself, not religious-owned or -affiliate organizations) are exempted from certain plan options that may violate their religious practices. Thus, the Roman Catholic Church will be required to provide an appropriate health plan for its priests and nuns, but will NOT have to provide free Birth Control to them. The Church cannot forbid their employees from obtaining said coverage if the employee pays for it themselves.

Organizations which are partially owned by a religion, or run by a religious order or individual (or group of individuals) are NOT allowed this exemption. They are considered businesses, and subject to the full requirements of the PPACA.

[Note: There is a current lawsuit around this last portion, which will be decided by the Supreme Court in 2014. However, current legal predictions by the large majority of legal scholars expect SCOTUS to uphold the full application of the law to all organizations not specifically incorporated as a religion, and thus the prior paragraph will continue to be valid]