SACRAMENTO – California Attorney General Xavier Becerra and New York Attorney General Letitia James, leading a coalition of six states and the District of Columbia, today sued the U.S. Department of Health and Human Services (HHS) for its unlawful reinterpretation of Section 1303 of the Affordable Care Act (ACA). On December 27, 2019, HHS issued a final rule requiring qualified health plans participating in the state exchanges like Covered California to send separate bills and collect separate payments of at least one dollar for abortion coverage. This onerous and confusing requirement threatens women’s access to abortion and puts millions at risk of accidentally losing critical health insurance coverage. The lawsuit highlights that the new rule is incompatible with the ACA’s requirement of equitable access to healthcare and disproportionately affects states that are committed to ensuring comprehensive reproductive healthcare.

“This new rule is just another Trump Administration attack on women and reproductive rights,” said Attorney General Becerra. “We have a long history of protecting women’s access to comprehensive reproductive healthcare, including abortion. We won’t let an unlawful administrative rule change that. And we will defend California’s ability to enact and enforce laws that promote the health of its residents.”

Under California law, all health plans regulated by the state are required to offer abortion coverage as part of their basic healthcare services. The new federal rule requires insurers to separately bill for the portion of health insurance premiums attributable to abortion coverage. The rule also requires consumers to make a separate payment of at least one dollar for these services or risk losing all of their healthcare coverage. HHS itself has conceded that requiring separate bills and separate payments will inevitably lead to confusion, putting more than 1.4 million enrollees in California alone at risk of losing coverage if they inadvertently fail to make full premium payments on time. The rule will also burden states with unnecessary administrative costs and harm consumers who will face higher insurance premiums as a result of increased costs to carriers. For example, initial compliance is expected to cost all impacted insurance companies nearly $400 million, with another $100 million in estimated annual costs to maintain the separate systems. These excessive costs put pressure on insurers to remove abortion coverage from their plans and punish those companies that do business in states like California where abortion coverage is required.

In the lawsuit, the coalition argues that the rule is unlawful because it:

Imposes onerous and unnecessary regulatory barriers aimed at restricting women’s constitutionally protected right to access abortion care;

Seeks to frustrate state sovereignty by coercing states to change their policies relating to the protection of abortion care;

Violates Section 1554 of the ACA, which prohibits the promulgation of any regulation that creates unreasonable barriers to the ability of individuals to obtain appropriate medical care; and

Exceeds HHS’s statutory authority under Section 1303 of the ACA.

Today’s lawsuit is the latest effort in Attorney General Becerra’s fight to defend women’s reproductive rights. On January 8, 2019, Attorney General Becerra, along with the attorneys general of New York, Oregon, Pennsylvania, and Washington, submitted a comment letter urging HHS to withdraw the rule at issue, which reinterprets the ACA, Section 1303. More recently, the Attorney General led a multistate coalition in filing amicus briefs in support of lawsuits challenging a series of restrictive abortion laws in Missouri and Arkansas; joined a coalition of 22 attorneys general in filing an amicus brief supporting a constitutional challenge to a Louisiana law requiring abortion providers to maintain hospital admitting privileges; led a coalition of 20 attorneys general in filing an amicus brief challenging Mississippi’s near-total ban on abortion in Jackson Women’s Health Organization, et al. v. State Health Officer of the Mississippi Department of Health, et al; led a coalition of 22 attorneys general in filing an amicus brief in support of a lawsuit challenging Mississippi’s House Bill 1510; and secured injunctions against the Trump Administration’s harmful rules that would do away with the ACA’s contraception coverage requirement.

Attorney General Becerra was joined in filing today’s lawsuit by the attorneys general of New York, Maryland, Maine, Oregon, Vermont, and the District of Columbia.

A copy of the complaint is available here.