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During the 2021 term and beyond, several issues involving health care will finally make their way to the Supreme Court.
The Patient Protection and Affordable Care Act (ACA)
While the Supreme Court left the ACA intact in California v. Texas, other cases involving specific provisions of the ACA are still being litigated in lower courts. In many of these cases, following the change in administrations, the Department of Justice has requested additional time to consider the issues raised. Whether these considerations result in changes to the government’s positions will be a key factor in whether these issues reach the Supreme Court.
The first set of these cases concerns Section 1557 of the ACA. Section 1557 prohibits discrimination in health care for protected classes. 42 U.S.C. § 18116. In drafting the law, Congress recognized the need to ensure all individuals have access to health services and insurance, regardless of their race, color, national origin, sex, age, or disability. The law prohibits such discrimination by applying existing civil rights laws to relevant conduct covered by the ACA.
The prior regulations interpreting Section 1557 made clear that sex discrimination prohibited by the law includes discrimination based on sexual orientation and gender identity. 81 Fed. Reg. 31,376 (May 18, 2016) (codified at 45 C.F.R. pt. 92). However, in 2020 HHS finalized a rule that would strip these protections out of the regulations. The rule also eliminated important language access provisions that enable individuals with limited English proficiency to obtain health care.
At least six lawsuits were filed last year, each arguing that the rule violates the Administrative Procedure Act. The lawsuits are not identical, but each alleged that the new rule is not in accordance with the ACA and that its adoption was arbitrary and capricious. See Whitman-Walker Clinic, Inc. v. U.S. Dep’t of Health and Human Servs., No. 1:20-cv-01630 (D.D.C); Asapansa-Johnson Walker v. Azar, No. 1:20-cv-2834 (E.D. N.Y.); Bagly v. HHS, No. 1:20-cv-11297 (D. Mass.); Washington v. HHS., No. 2:20-cv-1105 (W.D. Wash.); New York v. HHS, No. 1:20-cv-5583 (S.D. N.Y.); Chinatown Serv. Ctr. v. HHS, No. 1:21-cv-331 (D.D.C.).
AARP and AARP Foundation filed an amicus brief in the Whitman-Walker case, in support of the plaintiffs’ effort to stop implementation of the rule. The brief argued that allowing the rule to take effect would harm older adults, including members of the LGBTQ community and those with limited English proficiency. The brief also argued that implementing the rule during a public health crisis when access to care is critical would have devastating consequences.
On August 17, 2020, the District Court for the Eastern District of New York issued a preliminary injunction in the Asapansa-Johnson Walker case, blocking implementation of the portions of the rule that rolled back anti-discrimination protections for LGBTQ people. On September 2, 2020, the District Court for the District of Columbia also issued a preliminary injunction in the Whitman-Walker case, similarly stopping implementation of the portions of the rule rolling back anti-discrimination protections for LGBTQ people. The injunction also blocks a provision that would have extended Title IX’s religious exemption to Section 1557. The injunction applies nationwide and will remain in effect while the case proceeds.
On May 10, 2021, HHS issued new guidance regarding enforcement of Section 1557 that makes clear that prohibited discrimination based on sex includes discrimination on the basis of sexual orientation and gender identity. The agency has also stated that it will initiate a rulemaking proceeding interpreting Section 1557 in 2022. However, the plaintiffs in the Whitman-Walker litigation recently sought to lift the stay on the case, arguing that the provisions of the rule that remain in effect continue to cause ongoing harm. Plfs’ Mot. to Lift Stay of Proceedings, Whitman-Walker Clinic Inc. v. HHS (July 26, 2021) (ECF No. 74).
A second set of cases involves rules issued by the prior administration that were designed to expand the availability of short-term, limited-duration insurance (STLDI) and association health plans (AHPs). Ass’n for Cmty. Affiliated Plans v. U.S. Dep’t of Treasury, No. 18-2133 (RJL) (D.D.C.); New York v. U.S. Dep’t of Labor, No. 18-1747 (JDB) (D.D.C.). STLDI and AHPs are two types of health insurance not subject to the requirements of the ACA. The challengers argue that the agencies that issued these rules exceeded their authority and that the rules conflict with the ACA.
The district court invalidated the rule on association health plans, describing the rule as “designed to end run the requirements of the ACA[.]” New York v. U.S. Dep't of Labor, 363 F. Supp. 3d 109, 141 (D.D.C. March 28, 2019). The government appealed, and the D.C. Circuit held oral argument in November 2019. In January 2021, the Department of Labor filed a motion to hold the case in abeyance “to allow new agency officials sufficient time to become familiar with the issues in this case and determine how they wish to proceed.…” Consent Mot. to Hold Appeal in Abeyance, New York v. Dep’t of Labor, No. 19-5125 (Jan. 28, 2021) (Doc. #1882506).
In contrast, the district court upheld the STLDI rule. 2019 U.S. Dist. LEXIS 120834 (D.D.C. July 19, 2019). The plaintiffs appealed to the D.C. Circuit. AARP and AARP Foundation filed a brief in support of the plaintiffs-appellants, highlighting how the proliferation of these plans will harm older adults. Insurers who offer these plans can deny coverage because of preexisting conditions and charge exorbitant rates based on age alone, and they need not provide the minimum essential benefits that ACA-compliant plans must offer. The D.C. Circuit affirmed the lower court’s decision, holding that the rule does not violate the Administrative Procedure Act. Ass’n for Cmty. Affiliated Plans v. U.S. Dep’t of Labor, No. 19-5212, 2020 WL 4032806 (D.C. Cir. July 17, 2020). The plaintiffs-appellants’ petition for rehearing en banc was denied. Ass’n for Cmty. Affiliated Plans v. U.S. Dep’t of Labor, 966 F.3d 782 (D.C. Cir. 2020), reh’g en banc denied (D.D.C. Jan 26, 2021). Recently, the co-plaintiffs in the case and several amici, including AARP and AARP Foundation, sent a letter to HHS Secretary Becerra, requesting that the agency reverse the 2018 STLDI rule and issue a new rule more in line with the 2016 rule prior to the 2022 ACA Open Enrollment period.