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King vs. Burwell: Not the only PPACA court game around

By Allison Bell

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A Supreme Court case is getting most of the Patient Protection and Affordable Care Act (PPACA) litigation attention this week, but other PPACA cases are out there.

Lawyers for the Obama administration and PPACA opponents will get to square off tomorrow at oral arguments on King vs. Burwell, a case hinging on a question about whether PPACA lets the public health insurance exchanges created by the U.S. Department of Health and Human Services (HHS), rather than by state governments, offer PPACA premium tax credits.

Many of the other PPACA cases out there are difficult for ordinary mortals without access to full-text court filing databases to find. Many of the parties are angry about shortcomings with PPACA plans, exchanges, contract awards and regulatory arrangements may still be negotiating with the defendants in ad hoc meetings or arbitration proceedings, behind closed doors.

Plaintiffs’ lawyers are just learning about PPACA provisions that may give them the ability to file new types of lawsuits, such as PPACA-related whistleblower retaliation claims.

But we located some interesting state court cases with help from Wolters Kluwer Financial Services last fall.

See also: PPACA creeps into state and local courts: 5 early cases

We found an interesting selection of federal cases this week, by searching the federal court system. For a look at what we saw, keep reading.

Sylvia Mathews Burwell

1. Contraceptive benefits and abortion coverage challenges

For now, the obvious center of federal court PPACA litigation energy is a regulation that has only an indirect connection with PPACA: an HHS regulation that requires most employer health plans to include coverage for birth control in the basic preventive services package.

HHS is letting houses of worship and some other nonprofit religious employers notify HHS that they decline to offer birth control benefits coverage and let HHS take responsibility for arranging for the plan members to get those benefits.

Employers and their representatives have filed many cases arguing that HHS should make special arrangements for owners of for-profit companies who object to birth control, or certain types of birth control, and other cases that even requiring religious employers to help HHS provide birth control benefits for employees violates those employers’ freedom of conscience.

PPACA itself does not require that employers provide birth control benefits. The law does require all major medical plans to offer a basic preventive services package without imposing deductibles, co-payments or other cost-sharing charges on the enrollees, and Kathleen Sebelius, the previous HHS secretary, accepted a recommendation from the HHS Health Resources and Services Administration (HRSA) that she should put birth control benefits in the package.

Sylvia Mathwell Burwell inherited the role of defendant in birth control benefits suits when she became HHS secretary.

The U.S. Supreme Court already has ruled, in the Hobby Lobby decision, that HHS must make special arrangements for closely held companies with religious owners who object to birth control.

Eternal World Television Net Inc. has filed one of the many other birth control benefits mandates suits that are still open in the U.S. District Court for the South District of Alabama, and Catholic Benefits Association LCA has filed a similar case in the U.S. District Court for the Western District of Oklahoma. Many of the employers filing those cases have won injunctions keeping HHS from acting against them, and the Supreme Court required HHS to create an alternative system for the for-profit employers while the cases work their way through the system.

Plaintiffs in some cases argue that, because all health plans in their states cover elective abortions, requiring those plaintiffs to buy health coverage to avoid a tax penalty forces them to help pay for other people’s abortions. 

Alan Lyle How Jr. makes that case in Howe vs. Burwell et al., a suit filed against Burwell and other federal agencies and officials in January, in the U.S. District Court in Vermont. ”John Doe, an individual resident of Rhode Island,” who is poor and has HIV, has filed a similar suit in January in Rhode Island.

“To avail himself of any of those subsidies and avoid the draconian penalties defendants would impose, Doe must … pay specifically for others’ elective abortions,” lawyers say in a complaint filed on Doe’s behalf. “Doe is Catholic, a pro-life activist, and objects to being forced to pay for the killing of human beings through abortion.”

Exchange administration suits

2. Exchange administration suits

Some active cases involve questions about how state governments and other entities are implementing PPACA.

In Missouri, St. Louis Effort for AIDS and other nonprofit groups are suing the insurance commissioner and the Missouri Association of Insurance Agents to prevent the state from imposing what the nonprofit groups believe are unreasonable requirements on certified application counselors. The agents, in turn, have argued that giving the plaintiffs what they want would “have the effect of creating a separate class of people who perform the same functions and duties similar to those of licensed insurance producers for health lines. However, this new class of persons is not subject to the regulation or review of the state.”

Meanwhile, in a state court in Clark County, Nev., Lawrence Basich and other Nevada exchange users are moving ahead with efforts to sue the Silver State Health Insurance Exchange and its contractors over problems with the enrollment system the exchange used in 2014. The court recently rejected a motion to dismiss a contractor from the case.

Excepted benefits suits

3. Product regulation suits

Some suits focus on efforts by insurers and other organizations to keep HHS from imposing new requirements on the products they sell.

In the U.S. District Court for the District of Columbia, Central United Life Insurance Company and Senior Security Benefits Inc. sued in November 2014 to block HHS, the Centers for Medicare & Medicaid Services (CMS) and the agencies’ top officials from interfering with insurers’ efforts to sell “fixed indemnity plans.”

HHS wants to require sellers of fixed indemnity plans to verify that the buyers of the products have PPACA-compliant major medical coverage, or “minimum essential coverage.”

See also: HHS sets complicated fixed indemnity rules

The plaintiffs argue that federal regulators are exceeding their regulatory authority. The HHS rule will “result in losses of revenue and investments, customer base and goodwill, and the ability to compete fairly with others in the marketplace,” the plaintiffs say.

In January, HHS asked the court to dismiss the case.

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