Pennsylvania v. Trump, CIVIL ACTION NO. 17-4540

• Court: United States District Courts. 3th Circuit. United States District Court (Eastern District of Pennsylvania)
• Writing for the Court: WENDY BEETLESTONE, District Judge.
• Citation: 351 F.Supp.3d 791
• Decision Date: 14 January 2019
• Docket Number: CIVIL ACTION NO. 17-4540
• Parties: Commonwealth of PENNSYLVANIA and State of New Jersey, Plaintiffs, v. Donald J. TRUMP, Alex M. Azar II, United States Department of Health and Human Services, Steven T. Mnuchin, United States Department of the Treasury, Rene Alexander Acosta, the United States Department of Labor, and the United States of America, Defendants, Little Sisters of the Poor Saints Peter and Paul Home, Defendant-Intervenor.

351 F.Supp.3d 791

Commonwealth of PENNSYLVANIA and State of New Jersey, Plaintiffs,
v.
Donald J. TRUMP, Alex M. Azar II, United States Department of Health and Human Services, Steven T. Mnuchin, United States Department of the Treasury, Rene Alexander Acosta, the United States Department of Labor, and the United States of America, Defendants,

Little Sisters of the Poor Saints Peter and Paul Home, Defendant-Intervenor.

CIVIL ACTION NO. 17-4540

United States District Court, E.D. Pennsylvania.

Signed January 14, 2019

351 F.Supp.3d 796

Jonathan Scott Goldman, Lauren E. Sulcove, Office of Attorney General, Nicole J. Boland, Nikole Brock, PA Office of Attorney General, Harrisburg, PA, Aimee D. Thomson, Michael J. Fischer, PA Office of Attorney General, Philadelphia, PA, Elspeth L.F. Hans, State of NJ Div. Law Spec. Lit. Sect., Glenn J. Moramarco, Marc Alan Krefetz, State of New Jersey Div. of Law, Trenton, NJ, for Plaintiffs.

Elizabeth L. Kade, Christopher Healy, Ethan Price Davis, Joel L. McElvain, Justin Michael Sandberg, Rebecca M. Kopplin, U.S. Department of Justice, Washington, DC, Scott Webster Reid, U.S. Attorney's Office, Philadelphia, PA, for Defendants.

Lori H. Windham, Mark L. Rienzi, Becket Fund for Religious Liberty, Washington, DC, Nicholas M. Centrella, Conrad O'Brien, Philadelphia, PA, for Defendant-Intervenor.

OPINION

WENDY BEETLESTONE, District Judge.

351 F.Supp.3d 797

Table of Contents

I. Background...798

A. Contraceptive Mandate...798

B. Regulatory Action to Accommodate Religious Objections...799

C. Hobby Lobby & Wheaton College ...800

D. Regulatory Response to Hobby Lobby & Wheaton College ...800

E. Zubik Remand & Impasse...801

F. 2017 IFRs & First Preliminary Injunction...801

G. 2018 Final Rules & Second Motion for Preliminary Injunction...803

II. Analysis...804

A. Standing...804

1. Special Solicitude...805

2. Article III Standing...806

B. Venue...808

C. Preliminary Injunction...810

1. Legal Standard...810

2. Likelihood of Success on the Merits...810

a. APA Procedural Claim...810

i. Inadequate Response to Comments...811

ii. IFRs Taint the Final Rules...812

b. APA Substantive Claim...816

i. The ACA...817

ii. RFRA...821

3. Irreparable Harm...827

4. Balance of the Equities...829

5. Public Interest...829

D. Remedy...830

Plaintiffs, the Commonwealth of Pennsylvania and the State of New Jersey (collectively "the States"), have sued the United States of America, President Donald J. Trump, the United States Secretary of Health and Human Services Alex M. Azar II, the United States Secretary of the Treasury Steven T. Mnuchin, and the United States Secretary of Labor Rene Alexander Acosta in their official capacities, as well as each of their agencies (collectively "Defendants"), seeking to enjoin enforcement of two Final Rules that grant exemptions to the Affordable Care Act's requirement that health plans cover women's preventive services. The Final Rules "finalize" two Interim Final Rules, which Defendants issued in October 2017 and which this Court enjoined soon thereafter, see Pennsylvania v. Trump , 281 F.Supp.3d 553, 585 (E.D. Pa. 2017). On November 15, 2018, while their appeal of that preliminary injunction was pending, Defendants promulgated the Final Rules currently before the Court. The States move to enjoin enforcement of the Final Rules arguing that, like the IFRs before

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them, the Final Rules violate a variety of constitutional and statutory provisions. For the reasons set forth below, Plaintiffs' Second Motion for a Preliminary Injunction shall be granted.

I. Background¹

Although the relevant factual and procedural history of this dispute has been laid out at length before, see id. at 560-64, that background information is recounted here for the sake of clarity.

A. Contraceptive Mandate

In March 2010, Congress enacted the Affordable Care Act. See Patient Protection and Affordable Care Act ("ACA"), Pub L. No. 111-148, 124 Stat. 119 (2010). A provision of the ACA, the Women's Health Amendment, mandated that insurance providers cover preventive health services and screenings for women without cost-sharing responsibilities. Specifically, the Women's Health Amendment requires that "[a] group health plan and a health insurance issuer offering group or individual health insurance coverage shall, at a minimum provide coverage for and shall not impose any cost sharing requirements ... with respect to women, such additional preventive care and screenings ... as provided for in comprehensive guidelines supported by the Health Resources and Services Administration ["HRSA"] for purpose of this paragraph." 42 U.S.C. § 300gg-13(a)(4). This requirement applies to all health insurers offering individual or group insurance, as well as all group health plans, with an exception for certain "grandfathered" plans. 42 U.S.C. § 18011 (exempting "grandfathered" plans); see also 29 C.F.R. § 2590.715-1251 (2010).

Rather than enumerate the preventive services to be covered by the mandate, Congress delegated that decision to HRSA, which is an agency of Defendant Department of Health and Human Services ("HHS"). HRSA, in turn, commissioned the then-named Institute of Medicine ("the Institute"), to convene a panel of experts to provide recommendations.² On July 19, 2011, the Institute issued its report, recommending that the ACA cover "the full range of Food and Drug Administration-approved contraceptive methods, sterilization procedures, and patient education and counseling for women with reproductive capacity." Institute of Medicine, Clinical Prevention Services for Women: Closing the Gaps , at 109-10 (2011).

On August 1, 2011, HRSA issued its preventive care guidelines ("2011 Guidelines"), which adopted the Institute's recommendations. See HRSA, Women's Preventive Services Guidelines , available at https://www.hrsa.gov/womens-guidelines/index.html.³ The 2011 Guidelines hewed to the Institute's report, defining preventive care to include all FDA-approved "contraceptive methods, sterilization procedures, and patient education and counseling." Id. Under the Women's Health Amendment, "non-grandfathered group health plans and health insurance issuers are required

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to provide coverage consistent with the HRSA Guidelines, without cost sharing." Group Health Plans and Health Insurance Issuers Relating to Coverage of Preventive Services Under the Patient Protection and Affordable Care Act , 77 Fed. Reg. 8,725, 8,725 (Feb. 15, 2012). Thus these interlocking statutory and regulatory requirements created the so-called "Contraceptive Mandate."

B. Regulatory Action to Accommodate Religious Objections

At the same time, and based on "considerable feedback," HHS, the Department of Labor, and the Department of the Treasury (collectively "the Agencies") found it was "appropriate that HRSA, in issuing [the 2011] Guidelines, take[ ] into account the effect on the religious beliefs of certain religious employers if coverage of contraceptive services were required." Group Health Plans and Health Insurance Issuers Relating to Coverage of Preventive Services Under the Patient Protection and Affordable Care Act , 76 Fed. Reg. 46,621, 46,623 (Aug. 3, 2011). The Agencies therefore provided HRSA with "additional discretion to exempt certain religious employers from the Guidelines where contraceptive services are concerned." Id.

On August 1, 2011, the Agencies promulgated an interim final rule exempting certain religious employers from providing contraceptive services. Id. Under the exemption, a "religious employer" could be exempt from the Contraceptive Mandate only if it: (1) had the inculcation of religious values as its purpose; (2) primarily employed people who shared its religious tenets; (3) primarily served persons who shared its religious tenets; and (4) was a church, its integrated auxiliary, or a convention or association of a church exempt from taxation under the Internal Revenue Code. Id. On February 15, 2012, after considering more than 200,000 responses to this interim final rule, the Agencies issued a final rule adopting the "religious employer" definition. 77 Fed. Reg. at 8,725.

On March 21, 2012, the Agencies issued a notice of proposed rulemaking requesting comments on "alternative ways of providing contraceptive coverage without cost sharing in order to accommodate non-exempt, non-profit religious organizations with religious objections to such coverage." Certain Preventive Services Under the Affordable Care Act , 77 Fed. Reg. 16,501, 16,503 (March 21, 2012). After receiving and considering over 400,000 comments, the Agencies issued their final rule on July 2, 2013. Coverage of Certain Preventive Services Under the Affordable Care Act , 78 Fed. Reg. 39,870, 39,871 (July 2, 2013). The final rule had two noteworthy effects.

First, the rule "eliminate[ed] the first three prongs and clarif[ied] the fourth prong of the definition" of "religious employer" adopted in 2012. Id. at 39,874. Under the new...