West Virginia v. United States Department of Health & Human Services

145 F. Supp. 3d 94, 2015 U.S. Dist. LEXIS 147380, 2015 WL 6673703
CourtDistrict Court, District of Columbia
DecidedOctober 30, 2015
DocketCivil No. 1:14-cv-01287 (APM)
StatusPublished
Cited by5 cases

This text of 145 F. Supp. 3d 94 (West Virginia v. United States Department of Health & Human Services) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
West Virginia v. United States Department of Health & Human Services, 145 F. Supp. 3d 94, 2015 U.S. Dist. LEXIS 147380, 2015 WL 6673703 (D.D.C. 2015).

Opinion

MEMORANDUM OPINION

Amit P. Mehta, United States District Judge

I. INTRODUCTION

As part of the Patient Protection and Affordable Care Act (“ACA” or “the Act”), all individual health insurance plans are required to comply with eight federally mandated market requirements, unless a plan qualifies for a “grandfathering” exception. Responsibility for the enforcement of these market requirements is [96]*96shared by the federal government and the States. The ACA does not compel the States to enforce the market requirements, but provides them with the option of doing so if they desire. If a State declines to enforce the Act or does so inadequately, the ACA provides that “the Secretary [of Health and Human Services] shall enforce” the Act’s provisions “in such State.”

Initially, all health insurance plans that went into effect or were renewed after January 1, 2014, were required to be compliant with the ACA’s eight market requirements. ' However, after some individuals and small businesses received cancellation notices - from their insurance companies, the federal government— through Defendant Department of Health and Human Services (“HHS”) — instituted a change in policy (“the Administrative Fix”1 or “the Fix”). On November 14, 2013, HHS announced that, subject to certain conditions, it would refrain from enforcing the eight market requirements through October 1, 2014, thereby allowing consumers to retain coverage under non-compliant policies until that date. HHS further announced that - it would encourage States to follow 'the federal government’s lead and refrain from enforcing the eight market requirements. States, however, remained free to enforce the market requirements if they so wished. On March 5, 2014, HHS extended the Administrative Fix until October 1, 2016.

Plaintiff State of West Virginia brought this action to challenge the Administrative Fix, claiming that the Fix violates the Affordable Care Act and the Administrative Procedure Act; constitutes an unlawful delegation of federal executive and legislative power to the States; and contravenes state sovereignty under the Tenth Amendment. The merits of the State’s contentions, however, must take a back seat to. the threshold issue advanced by HHS in its Motion* to Dismiss:' that West Virginia lacks standing -to challenge ¡the Administrative Fix. ■

West Virginia asserts that it hás standing because the Administrative Fix forces it to make' an untenable choice: either regulate under the ACA or decline to regulate, in which base noneompliant policies will be sold within West Virginia’s borders because óf HHS’ policy decision not to enforce the ÁCA’s market requirements. These circumstances, West Virginia argues, have caused it to suffer two cognizable injuries. First, West Virginia contends that HHS’ . policy decision not to enforce the ACA has shifted enforcement responsibility to the State and made it the “exclusive and unfettered” enforcer of the ACA’s eight market requirements within its borders. This purported shifting of enforcement responsibility, West Virginia claims, has caused it to suffer an “anti-commandeering” injury under the Tenth Amendment. Second, West Virginia contends that the shift in enforcement responsibility has made the federal government less politically accountable for the non-enforcement of the ACA at the 'expense of the States. West Virginia alleges that this heightened “political accountability” to its own citizens constitutes a cognizable injury-

. The court rejects these arguments and concludes that West Virginia lacks standing to challenge • the Administrative Fix. The State’s, asserted injuries are not the kind of concrete and particularized injury-in-fact that is actual or imminent — and not conjectural or hypothetical — that is required to establish standing under the [97]*97standards set by Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). Therefore, because this court, lacks subject matter jurisdiction over this matter, the court grants Defendant’s Motion to Dismiss.

II. BACKGROUND

A. Factual Background

Congress enacted the Patient Protection and Affordable Care Act (“ACA” or “the Act”) on March 23, 2010. Def.’s Mem. in Supp. of Mot. to Dismiss, ECF No. 13-1, at 4 [hereinafter Def.’s Mem.]. Among the reforms initiated by the ACA was a requirement that all individual health insurance plan's that went into effect or were renewed after January 1, 2014, were to meet eight federally mandated market requirements, unless they fell under a grandfathering exception. Compl., ECF No. 1, ¶ 20.

The ACA established a regime of “cooperative federalism” to enforce these requirements. Under, the Act, States are the first line of enforcement and can elect to use their resources to enforce the ACA, consistent with their own state laws. Id. ¶¶ 25-26; 42 U.S.C. § 300gg-22(a)(l) (“[E]aeh State may require that health insurance issuers ... meet the requirements of this part with respect to such issuers.”). If a State elects not to enforce the market requirements, the ACA then tasks the Secretary of the Department of Health and Human Services (“HHS”) with making a “determination” as to whether “a State has failed to substantially enforce a provision (or provisions) in this part with respect to health insurance issuers in the State.” 42 U.S.C. § 300gg-22(a)(2). If the Secretary makes such a “determination,” the ACA provides that “the Secretary shall enforce such provision (or provisions) ... in such State.” Id. (emphasis added). In other words, if a State decides not to enforce the market requirements, the ACA authorizes the federal government to enforce the market requirements within a State’s boundaries.

In 2013, before the ACA’s market requirements went into effect, health insurance companies began sending insurance cancellation létters to cústómers whose plans were neither covered by the grandfathering exception nor compliant with the ACA-mandated market requirements. Compl. If 35. In response to those cancellations, on November 14, 2013, HHS instituted a policy change — what West Virginia refers to as “the Administrative Fix” — and announced that it would not, subject to two conditions, enforce the eight ACA-mandated market requirements until October 1, 2014. Id. ¶¶40, 44-45. ( Health insurers would be permitted to continue selling non-compiliant insurance coverage as long as (1) the plans had been in effect on October 1, 2013, and (2) the insurers informed affected customers of their plans’ non-compliance and the existence of the ACA’s health insurance exchanges. Id, ¶¶ 45-46. HHS “encouraged” the States to adopt the same transitional policy and thus to refrain from state-level enforcement of the market reforms. Id. ¶ 49 & Ex. 6 at 3. On March 5, 2014, HHS extended the Administrative Fix until October 1, 2016. Id. 111151-52.

“West Virginia believes that its citizens should be able to keep their individual health insurance plans if they like them.” E.g., id. ¶ 6.

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Bluebook (online)
145 F. Supp. 3d 94, 2015 U.S. Dist. LEXIS 147380, 2015 WL 6673703, Counsel Stack Legal Research, https://law.counselstack.com/opinion/west-virginia-v-united-states-department-of-health-human-services-dcd-2015.