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Trump Health-Worker Religious Rule Is Tossed by Federal Judge (2)

Nov. 6, 2019, 4:58 PMUpdated: Nov. 6, 2019, 9:35 PM

A Trump administration rule that allows health-care workers to deny care based on their religious and moral beliefs is invalid, the Southern District of New York said Nov. 6.

The Health and Human Services Department acted outside its rulemaking authority when it adopted the conscience protection rule, and the rule is contrary to the law, the court said. Congress didn’t delegate authority to the HHS to make substantive rules regarding the enforcement of laws regarding religious conscience protections, the U.S. District Court for the Southern District of New York said.

The rule was to take effect Nov. 22.

The Trump administration said the rule was a necessary part of its effort to enforce 25 conscience provisions scattered throughout various laws. Opponents said it would give the Department of Health and Human Services new power under those statutes to deny coverage to certain populations, like women seeking abortions and LGBT individuals.

The rule “unavoidably would shape the primary conduct of participants throughout the health care industry,” Judge Paul A. Engelmayer said in the decision.

The court found the rule conflicts with Title VII, which prohibits workplace discrimination, and the Emergency Medical Treatment and Labor Act, an anti-patient-dumping law that requires providers to care for people who come to emergency departments suffering from emergency medical conditions regardless of their ability to pay.

In addition, the agency’s action was arbitrary and capricious because there was no evidence the rule was needed to bolster tools for enforcing existing conscience protections, the court said. The agency also failed to adequately explain its policy change and to consider problems created by the rule, such as its tension with EMTALA, the court said.

The court granted summary judgment to the rule’s challengers, including New York City, New York, and multiple other states, the Planned Parenthood Federation of America, and the National Family Planning and Reproductive Health Association (NFPRHA).

Planned Parenthood receives funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg. Bloomberg Law is operated by entities controlled by Michael Bloomberg.

“HHS, together with DOJ, is reviewing the court’s opinion and so will not comment on the pending litigation at this time,” HHS spokeswoman Caitlin Oakley said in a statement.

“The court safeguarded the public’s health by striking down the Trump administration’s health care refusal rule,” NFPRHA President and CEO Clare Coleman said in a statement. “The court heard clear and compelling arguments about the harm communities face when our health care system is distorted to the point in which a patient’s health care needs are not paramount.”

Groups that supported the conscience rule bemoaned the decision.

“This decision leaves health care professionals across America vulnerable to being forced to perform, facilitate, or refer for procedures that violate their conscience,” Stephanie Taub, senior counsel for the First Liberty Institute, said in a statement. The First Liberty Institute is a legal organization that works to protect religious liberties.

A federal district court in California heard oral argument on the same issue recently and is expected to issue a decision soon.

Enforcement Tool Overreaching

The rule would have allowed the department to strip federal funding from employers through enforcement action, which could mean a loss of billions in funding for hospitals and clinics around the country if they require employees to go against their religious beliefs to provide care.

The rule’s enforcement mechanism—cutting off a noncomplying provider’s HHS funding—is overreaching and violates the U.S. Constitution’s separation of powers clause, the court said. Congress didn’t give the HHS this authority in any of its conscience protection pronouncements, it said.

The enforcement provision also violates the Constitution’s spending clause because it imposes ambiguous and retroactive conditions on providers’ receipt of federal funds. The rule is also impermissibly coercive “given the scale of funding it jeopardizes and the new standards of conduct the Rule imposes,” the court said.

The court stopped short of saying the rule violates the establishment clause. An as-applied challenge might succeed, it said, but wasn’t at issue here.

District courts don’t always rule on constitutional claims, so the fact that they did may mean they’re trying to help the appellate court in the inevitable appeal, Joel McElvain, a former assistant director in the Justice Department Civil Division who focused on health care, said.

Giving employees an absolute veto on whether to provide certain health-care services under this rule was a “really fundamental shift in how most members of the community thought the conscious rules used to apply,” McElvain, a partner at King & Spalding, said.

No Severability

Government staff will bristle at the court’s decision not to severe and vacate only the offending provisions of the rule, Andrew Tsui, a former litigation attorney with the HHS Office of the General Counsel, said.

However, the court found such a considerable amount of legal deficiencies that searching for surviving provisions would have ignored the larger issues with the rule.

“It takes a lot” for courts to vacate a rule from an executive agency, but the court was willing to go there and make a determination that the department acted beyond the scope of its authority, Tsui, currently an attorney at Olsson, Frank, Weeda, Terman & Matz, said. It’s significant when a court does that, no matter the subject matter.

This decision was both a rebuke of the rule itself and the way that the government issued the rule, Tsui said. The judge’s summary of the legal deficiencies at the end of the decision was a “litany of smackdowns.”

Title VII Conflicts

The ruling could ease concerns previously raised by employment law attorneys who said employers would have had to choose between complying with the HHS rule and a conflicting federal anti-discrimination law.

Many employers, including health-care providers, are currently required by Title VII of the 1964 Civil Rights Act to reasonably accommodate a worker’s religious, moral, or ethical beliefs, unless the accommodation exerts undue hardship on the business.

The Equal Employment Opportunity Commission says examples of undue hardships include “violating a seniority system; causing a lack of necessary staffing; jeopardizing security or health; or costing the employer more than a minimal amount.”

But the HHS rule wouldn’t have afforded employers the opportunity to speak up about potential “undue hardships,” therefore substantially conflicting with Title VII.

Agencies aren’t permitted to “regulate away” rights and defenses granted by Congress, the court said.

“Hospitals would undeniably be able to raise a burden if it had to delay or deny medically necessary or life-saving care to patients,” said Shirley Lin, a New York University Law School professor. Lin previously was with with plaintiffs’ side firm Outten & Golden.

“The court was clearly concerned about an unauthorized carve-out of the health care field from the reach of Title VII and state and local laws,” Lin said.

The New York Attorney General’s Office represented the state. The New York City Law Department represented the city. Covington & Burling LLP, Planned Parenthood, Democracy Forward Foundation, and the National Women’s Law Center represented Planned Parenthood. The American Civil Liberties Union and the New York Civil Liberties Union represented the NFPRHA.

The Department of Justice represented the HHS.

The case is New York v. U.S. Dep’t of Health & Human Servs., S.D.N.Y., No. 1:19-cv-4676, 11/6/19.

To contact the reporters on this story: Mary Anne Pazanowski in Washington at mpazanowski@bloomberglaw.com; Shira Stein in Washington at sstein@bloomberglaw.com; Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com