US District Judge Matthew J. Kacsmaryk, a staunch foe of LGBTQ rights before he was appointed to the US District Court for the Northern District of Texas by President Donald Trump, ruled on November 11 that the Biden Administration violated the Administrative Procedure Act (APA) and misinterpreted the Affordable Care Act (ACA) in 2021 when Secretary of Health and Human Services Xavier Becerra sent a “notification” to health care providers that his department would “interpret and enforce” the ACA’s prohibition on discrimination “on the basis of sex” to include “on the basis of sexual orientation” and “on the basis of gender identity.”
The notification cited the Supreme Court’s 2020 decision in Bostock v. Clayton County as its authority. In that case, the court ruled that firing somebody because of their sexual orientation or gender identity violates the ban on employment discrimination “because of sex” in Title VII of the Civil Rights Act of 1974. Justice Neil Gorsuch wrote for the court that it was impossible to fire somebody on those grounds without taking account of their sex, and the law prohibited taking an adverse personnel action because of an individual’s sex. He also wrote that the court was deciding only the question presented in the three cases consolidated for review, in all of which plaintiffs claimed that employers had discharged them because they were gay or transgender. He wrote that the court was not considering the interpretation or application of any other statute.
The ACA’s anti-discrimination provision, Section 1557, states that health care providers who receive federal money (which includes everybody who receives payments from Medicare or Medicaid) may not discriminate on grounds prohibited by a list of federal statutes, which includes Title IX of the Education Amendments Act. Title IX specifically prohibits discrimination “on the basis of sex” by educational institutions that receive federal money. The Biden Administration has taken the position that Title IX protects LGBTQ students from discrimination, and has focused on the general approach by federal courts to interpret Title IX as being consistent with the way the courts interpret Title VII on the issue of sex discrimination. Since June 2020 when the Bostock decision was issued, many federal courts have followed its reasoning to find that Title IX and, by extension, the ACA Section 1557, prohibit such discrimination.
The plaintiffs in the case before Judge Kacsmaryk, Doctors Susan Neese and James Hurly, challenged the Biden Administration’s “notification.” They claim that it was a change in the law that could not be accomplished by a simple notification without going through the APA requirements of publishing a proposed regulation, seeking public comments, and publishing a final regulation in the Federal Register, a process that can extend over many months. More to the point, they argue that differences in wording between Title VII and Title IX undercut the Biden Administration’s contention that the Bostock decision can be directly applied to Title IX.
Judge Kacsmaryk stated likely agreement with their argument earlier by denying the government’s motion to dismiss the case. Recently, he granted a motion by the plaintiffs to certify the case as a “class action,” designating them as representing all health care workers who are subject to ACA Section 1557 non-discrimination obligations. And, on November 11, he granted their motion for summary judgment, issuing a ruling on the merits of their claim in which he agrees with their arguments.
In addition to noting Justice Gorsuch’s statement circumscribing what the court was deciding in the Bostock case, he focused heavily on the difference in wording between Title VII (“because of sex”) and Title IX (“on the basis of sex”), even though Justice Gorsuch used both phrases interchangeably in his opinion for the court, and Justice Sam Alito, in dissent, complained that the decision would affect hundreds of federal laws and regulations by its reasoning. Kacsmaryk pointed to Supreme Court cases stating that when Congress varies the language that it uses, it must be found to have intended different meanings, otherwise it would have used identical language. He also observes in a footnote that when Title IX was enacted in the 1970s, the concept of gender identity as such was virtually unknown.
The judge also went to great lengths to show that Title IX’s various provisions would not, according to his argument, make sense if that statute, as applied to educational institutions, was interpreted to forbid gender identity discrimination. (Sexual orientation is not the main focus of this opinion and the plaintiffs’ problems with the “notification” are all stated in terms of dealing with transgender patients.)
“Title IX’s ‘overarching purpose,’ which is ‘evident in the text’ itself, is to prohibit the discriminatory practice of treating women worse than men and denying opportunities to women because they are women (and vice versa),” he wrote, citing a 2011 Supreme Court decision, AT&T Mobility LLC v. Concepcion. “Defendants’ interpretation of Title IX through the notification imperils the very opportunities for women Title IX was designed to promote and protect — categorically forcing biological women to compete against biological men.” He seized upon prior decisions referring to “immutable differences” between men and women, and Title IX regulations allowing for separate dormitories for men and women and sex-segregated restroom and locker room facilities.
“Ironically,” he wrote, concerning the issue of transgender participation in competitive athletics, “Defendants’ interpretation invites SOGI discrimination by excluding student-athletes from participating on the women’s or men’s teams based solely on gender identity. Presumably, this would force biological women who identify as men to compete against biological men, even if the biological women have the same physiological characteristics as a typical biological woman. Such an interpretation makes little sense, given Title IX’s text, structure, history, and purpose.” What this has to do with discrimination in health care is unclear, but then, it was Congress that decided to write the anti-discrimination section in the ACA in a peculiar way, incorporating by reference other statutes instead of spelling out the forbidden grounds of discrimination under the ACA directly, making Title IX the reference source for the ACA non-discrimination requirement “on the basis of sex.”
Thus, Kacsmaryk concludes, and will embody in a formal Order after receiving proposed language from the parties, to declare that Section 1557 does not forbid discrimination in health care “on the basis of sexual orientation or gender identity.” If it does not, then the notification is not a valid interpretation of Section 1557, and, as Kacsmaryk will go on to declare, the notification that was sent out to health care workers is void. However, curiously, and without any explanation in this opinion, he denied the plaintiff’s motion to the extent that it sought injunctive relief, and specifically granted in part the defendants’ motion for summary judgment by denying the plaintiff’s request for injunctive relief.
The Biden administration can appeal this ruling, but the appeal would go first to the Fifth Circuit Court of Appeals, a very conservative bench dominated by Republican appointees (12 out of 16 active judges, including six Trump appointees). Because some other federal courts have accepted arguments that Bostock’s reasoning can be applied to Title IX and by reference to the ACA, a ruling affirming Kacsmaryk’s decision would create a split of circuit authority that could lead to Supreme Court review, so this case, Neese v. Becerra, could result in a major repudiation of the Biden administration’s policy of preventing discrimination against LGBTQ Americans under numerous federal statutes other than Title VII.
The plaintiffs are represented by America First Legal Foundation, a litigation group formed by “alumni” of the Trump Administration, one of whose aims is to get courts to invalidate Biden administration policies that are contrary to the policies of the Trump administration.
