North Carolina Health Plan Seeks SCOTUS Review of Coverage Dispute

On Friday, a petition was filed with the Supreme Court of the United States by the North Carolina State Health Plan for Teachers and State Employees against certain current and former insureds who were the original plaintiffs in the trial level suit.

The plaintiffs originally filed suit against the North Carolina State Health Plan for Teachers and State Employees, arguing that the plan’s exclusion of coverage for gender reassignment-related surgeries for transgender individuals while still covering the procedures regarding direct medical treatments was discriminatory. For example, mastectomies were not covered when sought for transition, but were covered when related to cancer

The case is regarding the application of Section 1003 of the Rehabilitation Act Amendments of 1986, which limits the sovereign immunity of states provided by the Eleventh Amendment to the Constitution. The law at issue, Section 1003 of the Rehabilitation Act Amendments of 1986, unequivocally waives sovereign immunity for states for violations of four named laws; in controversy is the scope of the residual clause, which waives immunity for violations of “the provisions of any other Federal statute prohibiting discrimination by recipients of Federal financial assistance.”

While the courts have found unequivocal waiver regarding the four named acts in the excerpt above, there has been some circuit-splits regarding whether any other statutes are specifically covered by the waiver to the states’ sovereign immunity. The petitioners challenge whether the Patient Protection and Affordable Care Act is sufficiently directly concerned with discrimination as to fall under this residual clause.

The district court and the 4th Circuit held that due to the ACA having the same types of prohibition as the named acts as well as the same types of enforcement mechanisms, that the act was sufficiently similar to the named acts to require the same waiver of immunity.

The petitioners disagree and seek the review of the Supreme Court to certify that no automatic waiver of state immunity has occurred. This would result in remand to the trial court for dismissal due to sovereign immunity. If the court finds for the respondents, the case would return to the trial court for further proceedings after this interlocutory appeal.