In a major victory against the Trump Administration’s attempt to block abortion access for consumers on the Affordable Care Act exchanges, Judge Catherine Blake of the United States District Court for the District of Maryland vacated a Department of Health and Human Services and U.S. Centers for Medicare and Medicaid Services rule that would have required insurers to issue separate bills—one for general health care benefits and another for abortion care benefits—and would have required consumers to pay those bills in two separate transactions. This “Separate-Billing Rule” was yet another attempt by the Trump Administration to erect unnecessary hurdles for women to obtain abortions.
In December 2019, HHS and CMS published the Separate-Billing Rule, which they contended was meant to “better align” with congressional intent that the insurer “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.” The administration acknowledged that the burdens of administering the Separate-Billing Rule would have led to higher premiums for consumers and would have caused some insurers to drop insurance coverage for abortion altogether. HHS and CMS’s own cost-benefit analysis showed that the cost of implementing the rule was over $1 billion, while the benefits were $0. The administration also acknowledged that confusion surrounding the separate bills would have caused some people to miss premium payments, which would put them at risk of losing their health insurance coverage entirely.
In February 2020, Planned Parenthood of Maryland, Inc., and several individual consumers, on behalf of a nationwide class, filed a lawsuit challenging the rule.
On July 10, 2020, the Court ruled that the Separate-Billing Rule creates an “unreasonable barrier” because “it makes it harder for consumers to pay for insurance,” in violation of the Affordable Care Act. The Court explained that instead of “ensuring government funds are not spent on unauthorized purposes,” the rule “improperly impose[s] regulatory burdens” on consumers. The Court further ruled that the rule was arbitrary and capricious under the Administrative Procedure Act. It noted that the administration’s rationale for adopting the rule was “internally inconsistent” and “not sufficiently explained.” In adopting the rule, the administration “failed to consider relevant factors in determining Congressional intent,” including “the overall purpose of the ACA ‘to increase the number of Americans covered by health insurance and decrease the cost of health care.’”
Had the rule been implemented, its requirements would have affected more than 3 million consumers, including the individual plaintiffs in the lawsuit from Maryland, the District of Columbia, New Jersey, and Maine. The rule would also have affected one-third of the individual-market exchange plans nationwide, including every individual plan offered on the marketplace in Maryland.
Brown, Goldstein & Levy, served as co-counsel to the plaintiffs along with attorneys from with Planned Parenthood Federation of America, Inc., and the American Civil Liberties Union.