Roman Catholic Diocese of Dallas v. Sebelius

• Decision Date: 26 February 2013
• Docket Number: Civil Action No. 3:12–CV–1589–B.
• Citation: 927 F.Supp.2d 406
• Parties: The ROMAN CATHOLIC DIOCESE OF DALLAS, Plaintiff, v. Kathleen SEBELIUS, Hilda Solis, Timothy Geithner, U.S. Department of Health and Human Services, U.S. Department of Labor, and U.S. Department of Treasury, Defendants.
• Court: U.S. District Court — Northern District of Texas

927 F.Supp.2d 406

The ROMAN CATHOLIC DIOCESE OF DALLAS, Plaintiff,

v.Kathleen SEBELIUS, Hilda Solis, Timothy Geithner, U.S. Department of Health and Human Services, U.S. Department of Labor, and U.S. Department of Treasury, Defendants.

Civil Action No. 3:12–CV–1589–B.

United States District Court,

N.D. Texas,

Dallas Division.

Feb. 26, 2013.

Terence Michael Murphy, Basheer Y. Ghorayeb, Katherine Jean Lyons, Tamara Marinkovic, Thomas K. Schroeter, Jones Day, Dallas, TX, James S. Teater, Jones Day, Houston, TX, for Plaintiff.

Bradley Philip Humphreys, United States Department of Justice, Civil Division Federal Programs Branch, Washington, DC, for Defendants.

MEMORANDUM OPINION & ORDER

JANE J. BOYLE, District Judge.

Before the Court is Defendants' Motion to Dismiss for Lack of Jurisdiction (doc. 9), filed August 6, 2012. Finding that the Plaintiff has standing to bring this suit, the Court nonetheless concludes that the issues raised in the Complaint are not ripe for review. Accordingly, the Court GRANTS IN PART and DENIES IN PART Defendants' Motion as follows.

I.BACKGROUND

In one of many similar cases threading their way through the federal courts, Plaintiff The Roman Catholic Diocese of Dallas has sued the United States Departments of Health and Human Services (“HHS”), Labor, and Treasury, as well as their respective Secretaries, Kathleen Sebelius, Hilda Solis, and Timothy Geithner in their official capacities (collectively, “Defendants”), to challenge certain provisions of the Patient Protection and Affordable Care Act (“ACA”), Pub. L. No. 111–148, 124 Stat. 119 (2010), as amended by the Health Care and Education Reconciliation Act, Pub. L. No. 111–152, 124 Stat. 1029 (2010), and the regulations issued by each of the Defendants implementing it. Specifically, Plaintiff avers that the ACA and its implementing regulations, once enforced, will require Plaintiff to provide its employees with health insurance coverage for services and medications that defy the religious tenets held by Plaintiff. Plaintiff files this pre-enforcement challenge to the ACA for declaratory and injunctive relief.

A. Statutory and Regulatory Background

In March 2010, Congress enacted the Patient Protection and Affordable Care Act (“ACA”), Pub. L. No. 111–148, 124 Stat. 119 (2010), which was amended by the Health Care and Education Reconciliation Act, Pub. L. No. 111–152, 124 Stat. 1029 (2010) (collectively referred to as the “ACA”). The ACA established requirements for insured and self-insured “employee welfare benefit plans,” as defined in the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1002(1). See42 U.S.C. § 300gg–91(a)(1). Under the ACA, the group health plans must provide coverage for women's “preventive care and screenings” as defined by the comprehensive guidelines set forth by the Health Resources and Services Administration (“HRSA”), an agency within the HHS. 42 U.S.C. § 300gg–13(a). The “preventive care” coverage may not impose any cost-sharing requirements on the patient. 42 U.S.C. § 300gg–13(a)(4). Should an employer violate the ACA, it may be subject to monetary fines under the Internal Revenue Code, 26 U.S.C. §§ 4980D(b), 4980H(a), (c)(1); Health Insurance Portability and Accountability Act, 42 U.S.C. § 300gg–22(b)(2)(C)(i); and ERISA, 29 U.S.C. § 1132(a)(1)(B). The health care requirements are waived for “grandfathered” group health plans, which are generally defined as plans that existed prior to March 23, 2010 and have not undergone designated changes. 26 C.F.R. § 54.9815–1251T(a)(1)(i) (Treasury); 29 C.F.R. § 2590.715–1251(a)(1)(i) (Labor); 45 C.F.R. § 147.140(a)(1)(i) (HHS).

On July 19, 2010, the government issued interim final rules implementing the preventive services coverage provision and announced that HHS was developing the HRSA-supported comprehensive guidelines to define preventive care coverage under the ACA. 75 Fed. Reg. 41,726 (July 19, 2010). HHS commissioned the government-funded Institute of Medicine to recommend the substance of the guidelines. The Institute of Medicine recommended that “preventive care” should include Food and Drug Administration-approved contraceptive methods, sterilization procedures, and patient education and counseling for women with reproductive capacity.¹See Inst. of Med., Clinical Preventive Services for Women: Closing the Gaps (2011). On August 1, 2011, the Defendants adopted the guidelines advanced by the Institute of Medicine. 76 Fed. Reg. 46,621 (Aug. 3, 2011).

On August 3, 2011, the HRSA also implemented an amendment that exempted certain religious employers from the comprehensive guidelines and requirements to cover contraceptive services. Id.;45 C.F.R. § 147.130(a)(1)(iv)(A). The regulation defined a “religious employer” as:

an organization that meets all of the following criteria:

(1) The inculcation of religious values is the purpose of the organization.

(2) The organization primarily employs persons who share the religious tenets of the organization.

(3) The organization serves primarily persons who share the religious tenets of the organization.

(4) The organization is a nonprofit organization as described in section 6033(a)(1) and section 6033(a)(3)(A)(i) or (iii) of the Internal Revenue Code of 1986, as amended.²

45 C.F.R. § 147.130(a)(1)(iv)(B). Together, Defendants adopted this version of the religious employer exemption in the final regulations on February 15, 2012.

Aware that some religious entities may not qualify for the “religious employer” exemption, the government issued a bulletin announcing a one-year “temporary enforcement safe harbor” for certain non-profit organizations. An organization meeting the following criteria is said to be safe from enforcement during the safe-harbor period: (1) the employer is a non-exempt, non-profit organization, (2) due the organization's religious objections, the health care plan has not offered contraceptive coverage from February 10, 2012 onward, (3) the plan year begins between August 1, 2012 and August 1, 2013, and (4) the organization self-certifies that it meets the above criteria. HHS, Guidance on the Temporary Enforcement Safe Harbor, at 3 (Feb. 10, 2012); 77 Fed. Reg. 8725, 8728 (Feb. 15, 2012); 77 Fed. Reg. 16,501 (Mar. 21, 2012). The purported purpose of the one-year safe-harbor provision was to give the government time “to develop and propose changes to the [ ] final regulations that would meet two goals-providing contraceptive coverage without cost-sharing to individuals who want it and accommodating non-exempted, non-profit organizations' religious objections to covering contraceptive services.” Id. at 8727. The safe harbor began February 10, 2012 and continues through the first plan year for any plan that begins on or before August 1, 2012, effectively protecting qualified entities from enforcement until their new plan year initiating on or after August 1, 2013. The government pledges to work with non-exempt religious organizations to issue amended regulation(s) that accommodate religious coverage concerns. Id. at 8728–8729.

On March 21, 2012, the government published an Advanced Notice of Proposed Rule Making (“ANPRM”), notifying the public of its intent to reconsider the ACA implementing regulations, including ways to accommodate non-exempt religious organizations. 77 Fed. Reg. 16,501 (Mar. 21, 2012). The ANPRM stated that the departments “intend to finalize these amendments to the final regulations such that they are effective by the end of the temporary enforcement safe harbor.” Id. at 16,503. The ANPRM recognized the need to “to help identify issues relating to the accommodation to be developed with respect to non-exempt, non-profit religious organizations with religious objections to contraceptive coverage.” Id. The ANPRM further outlined the process for amendment, including an ANPRM comment period, publication of an proposed rule, a comment period on the proposed rule, and promulgation of amended final regulations. Id.

When this action was filed, no actual or concrete proposals to amend the ACA implementing regulations had been promulgated, though the government had made numerous public statements that the proposed amendments would be finalized in the first quarter of 2013. Doc. 31–1, Resp. to Notice at 3 n. 3. The government had also represented to numerous federal courts that amendment would be forthcoming and that they would never enforce the current regulations against certain nonexempt religious entities. See, e.g., Wheaton Coll. v. Sebelius, 703 F.3d 551, 553–53 (D.C.Cir.2012).

Approximately eight months after Plaintiff filed this action and five months after Defendant's Motion to Dismiss was fully briefed, Defendants issued a Notice of Proposed Rulemaking (“NPRM”), 78 Fed. Reg. 8456 (Feb. 6, 2013). The NPRM offers a proposed amendment to the ACA implementing regulations and requests comment on the same. The NPRM comment period remains open until April 8, 2013. Id. Among other suggestions, the NPRM outlines an amended definition of “religious employer” for the exemption at 45 C.F.R. § 147.130(a)(1)(iv)(B). The proposed amendment eliminates the first three prongs of the religious employer test, requiring only that the employer “is organized and operates as a nonprofit entity and referred to in section 6033(a)(3)(A)(i) or (iii) of the [Internal Revenue] Code.” 78 Fed. Reg. at 8461. The explained purpose of the amendment is as follows: “[T]he proposed rules would amend the criteria for the religious employer exemption to ensure that an otherwise exempt employer plan is not disqualified because the employer's purposes extend beyond the inculcation of religious values or because the employer serves or hires people of different religious faiths.” Id. at 8459. The NPRM also declares that “[t]he Departments intend to finalize all such proposed amendments before the end of the temporary enforcement safe harbor.” Id. at 8459.

B. The Roman Catholic Diocese of Dallas

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