Planned Parenthood of Md., Inc. v. Azar
| Decision Date | 10 July 2020 |
| Docket Number | Civil No. CCB-20-00361 |
| Parties | Planned Parenthood of Maryland, Inc., et al. v. Alex M. Azar II, Secretary of the United States of Health and Human Services, in his official capacity, et al. |
| Court | U.S. District Court — District of Maryland |
The plaintiffs, Planned Parenthood of Maryland, Inc., and individuals Kirsty Hambrick, Rebecca Parson, Mariel Didato, and Tanja Hollander on behalf of themselves and a proposed class, challenge the promulgation of a rule interpreting Section 1303 of the Patient Protection and Affordable Care Act ("ACA"). The defendants are Alex M. Azar II, in his official capacity; the U.S. Department of Health and Human Services ("HHS"); Seema Verma, Administrator of the Centers for Medicare and Medicaid Services, in her official capacity; and Centers for Medicare and Medicaid Services (collectively, "HHS" or "defendants"). Now pending are the plaintiffs' motion for summary judgment (ECF 29; ECF 411); the defendants' motion for summary judgment (ECF 35); the plaintiffs' motion for leave to file an amended complaint (ECF 39); and the plaintiffs' motion for class certification (ECF 40). The motions have been fully briefed and no oral argument is needed. The motion for leave to file an amended complaint, which has not been opposed, will be granted. For the reasons stated below, the motion for class certification will be granted, the plaintiffs' motion for summary judgment will be granted, and the defendants' motion for summary judgment will be denied.
This case concerns HHS's promulgation of a rule regarding the requirement of "separate payment" in Section 1303 of the ACA, which is codified at 42 U.S.C. § 18023. Section 1303 allows qualified health plans ("QHPs") offered through state exchanges to decide whether or not to provide coverage for abortion services, subject to state laws prohibiting or requiring such coverage. Id. (a), (b)(1)(A). But Section 1303 also prohibits federal funding of certain abortion services. Specifically, it prohibits the QHP issuer from using federal credits or federal cost-sharing reductions to pay for "non-Hyde abortions," which are abortion services for which public funding is prohibited under the Hyde Amendment.2 To that end, QHP issuers that provide coverage for non-Hyde abortions must:
42 U.S.C. § 18023(b)(2)(B). In 2012, HHS promulgated a regulation interpreting Section 1303 at 45 C.F.R. § 156.280, which largely repeated the language of the statute. HHS issued guidance in 2015, which provided that "section 1303 of the Affordable Care Act and § 156.280 do not specify the method an issuer must use to comply with the separate payment requirement" andnoted that the provision could be satisfied by, inter alia, "[s]ending the enrollee a single monthly invoice or bill that separately itemizes the premium amount for non-excepted abortion services; sending a separate monthly bill for these services; or sending the enrollee a notice at or soon after the time of enrollment that the monthly invoice or bill will include a separate charge for such services and specify the charge." Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2016, 80 FR 10750-01, 10840 (Feb. 27, 2015).
On November 9, 2018, HHS proposed the rule challenged here. See Patient Protection and Affordable Care Act; Exchange Program Integrity, 83 FR 56015 (Nov. 9, 2018) (proposed rule). HHS proposed that issuers would need to send two separate bills to the policyholder to comply with § 1303 (), and instruct the policyholder to pay the premium attributable to non-Hyde abortion coverage in a separate transaction. Id. at 56022-23. HHS stated that this rule would better align with "Congressional intent that the QHP issuer bill separately for two distinct (that is, 'separate') payments, one for the non-Hyde abortion services, and one for all other services covered under the policy." Id. at 56022. The proposed rule stated, though, that for enrollees who still pay the entire premium in one transaction, "the QHP issuer would not be permitted to refuse to accept such a combined payment on the basis that the policy subscriber did not send two checks as requested by the QHP issuer, and to then terminate the policy, subject to any applicable grace period, for non-payment of premiums." Id. at 56023.
HHS received many objections to the proposed changes. Patient Protection and Affordable Care Act; Exchange Program Integrity, 84 FR 71674, 71684 (final rule). Among the concerns were that it was an unnecessary change which would not enhance program integrity; that it would be against industry practice, which permits a single bill outlining charges; that itwould make it more difficult for policy holders to pay their premiums, as enrollees would not understand the second bill; that it could result in coverage being unintentionally terminated for failure to pay premiums; and that the requirement that issuers repeatedly instruct enrollees to send separate payments but also accept payments that are not separate would lead to confusion and increase the burden on issuers. Id. at 71684-85. Commenters also stated that HHS underestimated the costs of the proposed rule to issuers, as they would incur substantial operational and administrative costs in issuing separate bills. Id. at 71687. Exchanges, also, would need to make resource intensive changes to their websites, enrollment systems, and customer services. Id. As to enrollees, commenters argued that the rule could result in higher premiums (to account for the increased costs for issuers) and in QHP's dropping non-Hyde abortion coverage if the separate-billing requirement proves too burdensome. Id. Commenters also stated that the effective date was too soon and would not give issuers enough time to change their billing structure, especially since the effective date would be in the middle of a plan year. Id. at 71689.
On the other hand, "[a] minority of commenters summarily supported the policy." Id. at 71684. Some commenters stated that the new rule would promote compliance with the segregation of funds requirement and the requirement to collect separate payments, and supported the protections for enrollees if they sent back one combined payment. Id.
The final rule, published on December 27, 2019, largely adopted the proposed rule. HHS reasoned that, although Section 1303 does "not specify the method a QHP issuer must use to comply with the separate payment requirement," id. at 71683, "we continue to believe that the statute contemplates issuers billing separately for coverage of non-Hyde abortion services, consistent with Congress's intent that issuers collect separate payments for such services," id. at71685. In response to the concerns expressed in the notice and comment period, however, HHS changed the requirement that the bills be sent in separate mailings with separate postage, although bills sent electronically must still be sent through separate communications. Id.
The final rule contains some protections for enrollees who either continue to combine the two payments, or fail to make the separate payment for non-Hyde abortion coverage. The rule provides that a QHP issuer cannot terminate coverage if the enrollee pays the premium in a single payment, but "QHP issuers should make reasonable efforts to collect the payment separately." Id. HHS stated it would not take enforcement action against issuers that decline to put enrollees in a grace period or terminate coverage if the enrollee fails to make the separate payment for non-Hyde abortion coverage. Id. at 71686. The final rule also stated that, until HHS is able to address certain concerns through future action, "we also will not take enforcement action against QHP issuers that modify the benefits of a plan either at the time of enrollment or during a plan year to effectively allow enrollees to opt out of coverage of non-Hyde abortion services by not paying the separate bill for such services." Id. This would result in a modified plan that does not cover non-Hyde abortion services with no obligation to pay the premium for such services, although the ability for issuers to do this is subject to state law. Id. The plaintiffs refer to this as the "Opt-Out Policy."
HHS stated that the final rule would cost over $1 billion between 2020 and 2024. Id. at 71707. In response to concerns about the substantial costs of the rule to issuers, exchanges, and enrollees, HHS stated that this use of resources "is important to achieving better alignment of the regulatory requirements for QHP issuer billing of enrollee premiums with the separate payment requirement in section 1303 of the PPACA." Id. at 71688.
The final rule sets the implementation deadline as 60 days after the publication of the rule in the Federal Register, id. at 71687, but due to the COVID-19 pandemic, the effective date has been delayed by 60 days, to August 26, 2020. See Medicare and Medicaid Programs, Basic Health Program, and Exchanges; Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency and Delay of Certain Reporting Requirements for the Skilled Nursing Facility Quality Reporting...
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