California v. HHS, 2019 WL 5382250 (9th Cir. 2019)
The Ninth Circuit has upheld a California trial court’s preliminary injunction blocking enforcement in several states of final regulations expanding the exemptions from the Affordable Care Act’s contraceptive coverage mandate. As background, qualifying religious employers are exempt from the mandate, and certain other employers with religious objections to contraceptives may engage in an accommodation process relieving them of their coverage obligation (see our Checkpoint article). Final regulations expanded the exemption to include additional individuals and entities based on sincerely held religious beliefs or sincerely held moral convictions (see our Checkpoint article). However, the regulations were blocked from enforcement by a nationwide preliminary injunction issued by a trial court in Pennsylvania, as well as a separate preliminary injunction with a limited geographic scope from a trial court in California (see our Checkpoint article). HHS appealed both cases, and the Third Circuit already upheld the nationwide preliminary injunction from the Pennsylvania trial court (see our Checkpoint article).
On appeal of the California trial court’s decision, the Ninth Circuit has now upheld the court’s determination that the final regulations likely violated the Administrative Procedure Act because the agencies likely lacked the authority to issue the regulations, and the regulations likely are arbitrary and capricious. Furthermore, the Ninth Circuit ruled that the Religious Freedom Restoration Act likely does not authorize the religious exemption at issue in this case because, among other things, the exemption contradicts congressional intent that all women have access to appropriate preventative care, and the challengers failed to demonstrate a substantial burden on religious exercise. The court also concluded that the case is not moot despite the Third Circuit’s nationwide preliminary injunction, based on an exception for “cases capable of repetition, yet evading review.”
EBIA Comment: The Ninth Circuit’s limited-scope preliminary injunction has little practical impact in light of the Third Circuit’s nationwide injunction barring enforcement of the expanded regulations. Moreover, the Third Circuit’s decision has already been appealed to the U.S. Supreme Court and an appeal in this case may soon follow, so both cases may ultimately be settled by the Supreme Court. For more information, see EBIA’s Health Care Reform manual at Section XII.C (“Coverage of Preventive Health Services”) and EBIA’s Group Health Plan Mandates manual at Section XIV.E (“Contraceptive Coverage: Exemptions and Accommodations Based on Religious Beliefs and Moral Convictions”). See also EBIA’s Self-Insured Health Plans manual at Section XIII.C.1 (“Preventive Health Services”).
Contributing Editors: EBIA Staff.