A federal judge has recently halted the enforcement of a regulation by the Department of Health and Human Services (HHS) that aimed to provide protection against discrimination in healthcare for individuals identifying as transgender.
The ruling, issued by Judge Louis Guirola Jr. of the U.S. District Court for the Southern District of Mississippi, a George W. Bush appointee, has effectively put a stop to the implementation of a rule that sought to expand the definition of sex discrimination under Section 1557 of the Affordable Care Act.
According to RedState, Judge Guirola's ruling stated that the HHS is enjoined from enforcing, relying on, implementing, or otherwise acting pursuant to the May 2024 Rules provisions concerning gender identity. This ruling is applicable nationwide and echoes a similar decision made earlier this week when another federal judge rejected the Department of Education's attempt to expand the interpretation of Title IX in a similar manner.
The HHS had announced in May a comprehensive set of changes to Section 1557, the nondiscrimination provision of the Affordable Care Act. These changes, which were scheduled to take effect last Friday, broadened the rules definition of sex discrimination to include discrimination based on sexual orientation and gender identity. This move sparked outrage among officials in conservative states.
In response to the new rule, fifteen Republican-led states including Tennessee, Mississippi, Alabama, Georgia, Indiana, Kansas, Kentucky, Louisiana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, Virginia, and West Virginia, filed a federal lawsuit against the Biden administration in June. The states contended that the new rule replaces their health regulations with a regime that sides with HHSs commitment to gender ideology over medical reality.
The states further argued that they could not have foreseen the manner in which the Biden administration has implemented Section 1557. They claimed that the latest interpretation of the law unlawfully coerces compliance by threatening to withdraw billions of dollars in federal funding from state health programs that depend on it.
The HHS rule was met with a wave of lawsuits shortly after its announcement. Four separate lawsuits were filed in federal courts in Florida, Mississippi, and Texas. The lawsuits all share similar allegations, accusing the HHS of violating the Administrative Procedure Act by defining discrimination in a way that exceeds the scope of current law. They also argue that the HHS is infringing upon the US Constitution, including free speech protections and the spending clause, due to the agencys ability to withhold funds for non-compliance with the rule.
Nicole Huberfeld, a health law professor at Boston University, noted that theres a bigger-picture set of arguments at play. Among these is the plaintiffs' attempt to challenge the major questions doctrine, a legal principle stating that agencies deciding on issues of national economic or political importance need explicit approval from Congress first.
Another overarching effort is aimed at curbing Congress spending power. The challengers theory is that state sovereign authority is being somehow burdened by the way that Congress is using its spending power, Huberfeld said. This is because federal programs like Medicaid, the Childrens Health Insurance Program, and health insurance exchanges depend on states participation, so states must comply with the Section 1557 rule if they want the federal funding for those programs, Huberfeld added.
Judge Guirola's decision was further bolstered by his reference to the Loper Bright decision, which effectively undermined the "Chevron Deference" principle that HHS could have used as a defense. In his ruling against the Biden administration, the judge also cited a significant Supreme Court ruling last week that overturned the longstanding Chevron Deference precedent that required courts to defer to federal agencies that create regulations based on an ambiguous law.
Plaintiffs have demonstrated a substantial likelihood of success on the merits of their claim that HHS exceeded its statutory authority by applying the Bostock holding to Section 1557s incorporation of Title IX in its May 2024 Rule, Guirola wrote, quoting from the Supreme Courts ruling last week. And to the extent that Congress and the Executive Branch may disagree with how the courts have performed [their] job in a particular case, they are of course always free to act by revising the statute.
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