OAKLAND, Calif. (CN) – A federal judge signaled Tuesday he would block new rules by the Trump administration that allow any employer or insurer to opt out of including contraception coverage in their health care plans on religious and moral grounds.
Prior to Oct. 6, only houses of worship and religious nonprofits could opt out of covering contraception for their workers under the Patient Protection and Affordable Care Act. Now, under the Trump administration’s interim rules, any employer or health insurer with religious or moral objections can opt out of the health law’s contraceptive-coverage requirement.
U.S. District Judge Haywood Gilliam Jr. of Oakland, Calif., clarified Tuesday that he had not yet decided whether he would grant a nationwide preliminary injunction barring implementation of the rules. But he indicated he was inclined to grant it because the government had pushed the rules through without public notice and comment, which violates the Administrative Procedures Act.
“Why could that not be done with standard notice-and-comment procedures?” Gilliam asked Justice Department attorney Ethan Davis.
California, Delaware, Maryland, New York and Virginia sued the administration over the new rules last month, claiming they were illegal because they discriminate against women and advance a religious purpose. They moved for an injunction soon after, arguing that the rules would cause immediate and irreparable harm to their residents and to the states themselves as millions of women would lose federally mandated coverage and seek alternative coverage through state-funded programs.
The Affordable Care Act mandates that employers offer health insurance that covers birth control with no co-payment. Houses of worship were granted an exemption to the mandate, while nonprofits were allowed to opt out via an “accommodation,” by which an employer certified its objection to the mandate to the federal government. The government was then tasked with confirming that insurers provided separate coverage.
Under the Oct. 6 rules, which took effect immediately, exempted entities are no longer required to certify their objection or otherwise notify the government of their decision to stop providing coverage, according to plaintiffs.
Urging Gilliam for the injunction on Tuesday, California Justice Department attorney Julie Weng-Gutierrez argued that the rules would inflict irreparable harm on the states’ female residents by increasing the number of unintended pregnancies, and on the states, which would have to pay for them. According to the plaintiffs’ brief, 48 percent of all pregnancies in California – the lead plaintiff – were unintended in 2010. Of those unplanned pregnancies that resulted in births, 63 percent were publicly funded, costing California $689 million.
“Under the interim final rules, when the cost of contraception increases, women are more likely to use less effective methods of contraception or none at all,” she said. “The court does not need to wait for the ax to fall here. There is sufficient harm. There is a concrete group of women and employers who will be harmed by these [new rules].”
Davis countered that the plaintiffs had failed to show the rules would irreparably harm them or their residents, a requirement for an injunction. The plaintiffs, he said, hadn’t identified any employers expected to stop covering contraception on Jan. 1, and hadn’t alleged that their female residents would lose coverage due to the expanded exemption. Their claims that the states would suffer financially were based on “conjecture,” Davis added in the administration’s brief.
“It would be extravagant to grant an injunction when the states have identified no one who would be injured by these rules,” he told Gilliam. “It is highly uncertain whether the new rules will effectively take away contraception coverage from anyone currently receiving coverage.”
Turning to the plaintiffs’ Administrative Procedures Act claim, Davis pointed out that the statute gave federal agencies discretion to craft the original religious exemption.
“If those agencies can craft the earlier exemption, there is no reason they can’t craft the exemptions at issue here,” he said.
On Tuesday, Gilliam also seemed inclined to allow the Little Sisters of the Poor, a religious nonprofit operated by an order of Catholic nuns, to intervene in the case. The Little Sisters previously won an injunction in the Supreme Court, in Zubik v. Burwell, that they say the states’ lawsuit threatens. The 2016 injunction bars the federal government from imposing fines on religious nonprofits for failing to comply with the contraception mandate, saving the Little Sisters $3 million in annual fines, according to their court brief.
But Gilliam said the Zubik injunction the Little Sisters are seeking to defend would remain intact even if he does grant the states their injunction.
While the Affordable Care Act lets religious groups opt out of the contraception mandate, the plaintiffs in Zubik – a group of religious nonprofits – said the law’s framework still made them complicit in contraception use by forcing them to facilitate contraception coverage through their health plans.
Zubik was one of eight cases the Supreme Court took up from the Third, Fifth, 10th and D.C. Circuits, all of which found that the contraception mandate serves a compelling government interest while giving religious groups an acceptable way out.