MEDIA ADVISORY: Fed Court Rules States Opting Out Of Federal Health Exchanges Can’t Impose Additional Restrictions On State Exchange

MEDIA ADVISORY: Fed Court Rules States Opting Out Of Federal Health Exchanges Can’t Impose Additional Restrictions On State Exchange

Ruling in Missouri v. St. Louis Effort for AIDS has implications for other states obstructing implementation of Affordable Care Act

WASHINGTON—In the first case of its kind, Missouri vs. St. Louis Effort for AIDS, a federal district court has ruled that states that opt to have the federal government run their health insurance Exchange must leave its operation to the federal government, and cannot impose additional requirements or limitations on the Exchange.

The Affordable Care Act and HHS regulations authorize various consumer-assistance entities, including Navigators and Certified Application Counselors, to help consumers enroll in health insurance coverage. In 2013, more than a dozen states-including Missouri-enacted laws that both impose additional licensing standards on consumer assisters and limit the activities they are permitted to engage in. In November 2013, two federally-certified consumer assistance counselors, the St. Louis Effort for AIDS and Planned Parenthood of the St. Louis Region and Southwest Missouri, along with six other plaintiffs, challenged the Missouri law in federal court.

Today the court enjoined the Missouri law, prohibiting the state from regulating “entities and individuals certified under federal law to provide services or perform functions pursuant to the Affordable Care Act and its attendant regulations.” The Court emphasized that the ACA gives states a choice of operating their own Exchange or having the federal government operate the Exchange, and that when they choose the latter they can’t impose additional requirements or limitations on the exchange.

“Missouri’s attempts to obstruct the Affordable Care Act with unnecessary and burdensome navigator requirements are simply preempted by federal law,” said Jane Perkins, co-counsel for plaintiffs and Legal Director of the National Health Law Program. “On this the court is clear: federally funded navigators must be able to exercise the duties they are funded to do under federal law. Missouri cannot interfere with that.”

“The Court concluded that states that have opted to have the federal government run their Exchange cannot pass laws that make the operation of the Exchange more difficult or onerous,” said Jay Angoff, counsel for Plaintiffs and former director of ACA implementation at HHS. “This opinion calls into question the Constitutionality of laws in many states obstructing the implementation of the ACA. This decision is great news for consumers.”

The Court also found that the Missouri law is preempted by the Affordable Care Act under the Supremacy clause of the Constitution and the doctrine of conflict preemption. Under that doctrine, state laws cannot stand when compliance with both the federal and state law is impossible or when the state law is an obstacle to the purposes of the federal law. The Court found that the Missouri statute, by both establishing additional licensing standards for ACA-authorized consumer-assistance and preventing them from assisting consumers as required by the ACA, conflicts with and is therefore preempted by the ACA.

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