Tracking the latest developments in the fight for a fair America
By Adam Sonfield
Senior Public Policy Associate
On March 25, the Supreme Court will hear oral arguments on two high-profile challenges to the Affordable Care Act’s contraceptive coverage guarantee, which requires most private health plans to cover the full range of women’s contraceptive methods and services, without patient out-of-pocket costs. These cases, Sebelius v. Hobby Lobby Stores and Conestoga Wood Specialties v. Sebelius, were initiated by for-profit corporations and their owners asserting religious objections to coverage of and counseling and education about specific contraception methods (emergency contraceptive pills and intrauterine devices) that they claim cause abortion.
The cases involve complex legal claims, including challenges under the First Amendment’s protection for religious exercise and the Religious Freedom Restoration Act of 1993. However, there are also central questions of fact—many of which may seem self-evident—that have been subject to misinterpretation and obfuscation. The Guttmacher Institute has written extensively about the policy and submitted an amicus brief laying out many of these facts. Notably:
- Contraception is not abortion. Numerous medical associations made this fact clear to the Court by describing the science of how pregnancies are established and the most up-to-date evidence of how contraception works. And indeed, evidence from the United States and abroad helps show the obvious: that by preventing unintended pregnancies, effective contraceptive use reduces the need for abortion. For example, publicly supported family planning services helped U.S. women prevent 760,000 abortions in 2010 alone; without such services, the U.S. abortion rate would have been two-thirds higher.
- Contraceptive use benefits women and families. The government has a strong interest in promoting contraceptive use because it enables women and couples to prevent unplanned pregnancies and to plan and space those they do want. That, in turn, has real health benefits: It decreases pregnancy-related illness, injury and death; reduces the chances of premature and low-birth-weight deliveries; and is linked to improved prenatal care and breast-feeding. Moreover, according to numerous studies and to women themselves, contraceptive use enables women to complete their education, get and keep a good job, support themselves and their families financially, and invest in their children’s future.
- Contraceptive methods are not interchangeable. Methods of contraception differ dramatically in their effectiveness. Moreover, women’s contraceptive needs and choices are influenced by concerns about side effects and drug interactions, how frequently they expect to have sex, their perceived risk of Sexually Transmitted Infections (STIs) and a host of other factors. Women who are not completely satisfied with their choice of a method are particularly likely to use it inconsistently or incorrectly, or to experience gaps in use. For these reasons, women need access to not just any method of contraception, but to the one most suitable for their individual needs and circumstances.
- Insurance coverage improves use. Cost is a substantial barrier to women’s ability to choose and use the best method for them. Highly effective methods, such as IUDs, implants and sterilization, are ultimately cost-effective, but entail high up-front costs. Even for the pill, uninsured women on average pay $370 for a full year’s supply; that is the equivalent of 51 hours of work for someone making the federal minimum wage of $7.25. So, it is no surprise that one-third of women would switch methods if they did not have to worry about cost. Removing cost barriers—as the federal policy requires, for contraception and dozens of other effective preventive care services—has been proven to make a substantial difference in facilitating access to and use of needed care.
- Counseling and education matter. In fact, the plaintiffs in these cases object not only to specific contraceptive methods but also to counseling and education involving those methods. Put into practice, that might mean a gag rule: a ban on talking with one’s doctor about the full range of contraception options, if the office visit is to receive any insurance reimbursement. That would undermine women’s ability to choose the method they will use most effectively. More broadly, it would have serious repercussions for the health provider-patient relationship and for women’s ability to give informed consent for their care.
In sum, the scientific evidence strongly supports the current federal policy on contraceptive coverage. Its benefits are tangible and substantial, and thus the employees and their family members who depend on these companies for their health insurance have a great deal to lose if their employers get their way.
Moreover, the Supreme Court’s decision could have consequences far beyond contraception. For example, there are many important coverage guarantees included in the Affordable Care Act and federal law more broadly. Employers might claim religious objections to coverage—for everyone or, for instance, for those who are young, unmarried or gay—of HPV vaccination, STI testing, breast-feeding equipment, maternity care, blood transfusions, HIV medication and mental health care.
So, it’s not only women and couples in need of contraceptive care who should be worrying about the outcome of these cases; new rights for employers that override the rights and needs of their employees should worry us all.
Adam Sonfield is senior public policy associate at the Guttmacher Institute
A proposed FDA rule responds to the Supreme Court’s disturbing decision in Pliva v. Mensing
By Erika K. Duthely, AFJ Dorot Fellow
Imagine this: your doctor prescribes you a drug. You head to your local pharmacy to have your prescription filled and the pharmacist offers you the generic version at a much lower price. He assures you that the drug is identical, except in name. But thanks to a federal regulation and a U.S. Supreme Court ruling, in exchange for the lower price, you may be giving away your right to sue if the label didn’t warn you about potential hazards and something went terribly wrong.
Simply because the drug is a generic, the manufacturer could be shielded from liability for an inadequate warning on the label.
Here’s the problem. If the manufacturer of a brand name drug discovers new side effects after it’s on the market, the manufacturer has the right, indeed the obligation, to change the label. But generic drug manufacturers can’t change their labels until the brand name manufacturer acts. And once a drug is manufactured generically, the brand name manufacturer often leaves the market – and so is not looking for potential new side effects.
The tragic consequences are illustrated in this portion of AFJ’s brief documentary, Unequal Justice:
We are deeply saddened to report that early in 2013, a few months after her ninth surgery, Camille Baruch, who is featured in this video, died. The cause of death is not yet known, but her mother notes that Camille’s immune system was compromised by the drugs she had to take as a result of the illnesses described in the video. Ms. Baruch was 19.
In order to address this problem, the Food and Drug Administration recently released a proposed rule that would allow manufacturers of generic drugs to update label information more quickly once new health and safety information becomes available. Alliance for Justice joined with the Center for Justice and Democracy (CJD) and a number of other groups in submitting comments in support of the FDA’s proposed rule.
As the comments we submitted state, as things stand now:
a generic drug manufacturer [can] maintain a label even if it knows that label to be inaccurate and out-of-date. In addition to raising serious safety concerns, the current regulations have had severe legal consequences for patients harmed as a result of unsafe generic drug labels.
Those severe legal consequences stem from the Supreme Court’s 2011 decision in PLIVA, Inc. v. Mensing (the case discussed in our video) where, as our comments state,
[T]he U.S. Supreme Court immunized the generic drug industry for marketing drugs with labels they know to be inaccurate and out-of-date because current regulations prevent generic companies from independently changing drug labels.
As Alliance for Justice has previously noted, the dissenters in PLIVA “identified three ‘absurd consequences’ that will result from the Court’s decision.”
First, generic drug consumers will have no access to compensation when they are injured by inadequate warnings. This creates an “arbitrary distinction” between brand-name and generic-drug consumers that Congress did not intend to create. As a result of this decision and the 2009 Wyeth decision, the majority concedes that a consumer’s ability to seek compensation for injuries depends on whether a pharmacist fills a prescription with the brand-name or generic version of a drug. Many states allow pharmacists to unilaterally make such substitutions. Second, generic-drug manufacturers will no longer have the same state-law incentives to monitor and disclose safety risks that brand-name manufacturers have. As the dissent observed, “brand-name manufacturers often leave the market once generic versions are available, meaning that there will be no manufacturers subject to failure-to-warn liability.” Third, the decision undercuts the goals of the Hatch-Waxman Amendments to increase the consumption of less expensive generic drugs. Doctors will be more hesitant to prescribe generic drugs and patients will be less likely to take them because generic-drug manufacturers will now face weaker safety incentives.
According to the FDA, PLIVA “alters the incentives for generic drug manufacturers to comply with current requirements to conduct robust postmarketing surveillance, evaluation, and reporting, and to ensure that the labeling for their drugs is accurate and up-to-date.”
As our comments state, this proposed rule is necessary because it “would ‘create parity’ between brand name and generic drug companies to independently ensure safe product labels. American patients and prescribing physicians deserve no less.”
We urge the the FDA to implement this rule—and restore justice for generic drug consumers—without delay.
Find out more about PLIVA v. Mensing here.
Yesterday morning, I was privileged to attend Supreme Court oral arguments in Halliburton Co. v. Erica P. John Fund, Inc.
This is the case where Halliburton is asking the Supreme Court to overturn a 26-year old precedent in order to make it infinitely more difficult for shareholders to stand up for their rights in court against corporations that have defrauded them out of their hard-earned money. Halliburton itself is accused by plaintiffs, led by an organization supporting the charitable work of the Archdiocese of Milwaukee, of making material misrepresentations to its investors on such issues as its asbestos liability, causing losses to those investors.
As Alliance for Justice noted in our new report, “Halliburton at the Supreme Court: What’s at Stake in Halliburton, Inc. v. Erica P. John Fund,” if the Supreme Court rules the way Halliburton is asking it to, “In many instances, it would essentially be giving businesses like Halliburton a ‘get out of jail free’ card to defraud their own shareholders without consequence.” Read more
By Jason Zuckerman
On Tuesday, the Supreme Court held in Lawson v FMR that employees of contractors and subcontractors of publicly-traded companies are protected against retaliation under the whistleblower protection provision of the Sarbanes-Oxley Act (SOX). The decision is a big win for corporate whistleblowers, a rejection of the Chamber of Commerce’s attempt to create a massive loophole in SOX, and an important bulwark in protecting investors and avoiding another Enron.
Jackie Lawson and Jonathan Zang were employed by private companies that provided investment advisory services to the Fidelity mutual funds and brought SOX retaliation claims alleging that their employment was terminated for disclosing violations of SEC rules. In the mutual fund industry, the corporate entities that are required to file reports with the SEC typically do not have employees, and the funds are managed by employees of investment advisors. Despite statutory text prohibiting contractors and subcontractors of publicly traded companies from retaliating against whistleblowers, the First Circuit held that SOX covers only employees of publicly-traded companies, thereby excluding employees in the mutual fund industry from SOX whistleblower protection.
Applying the plain meaning of the statute and what Justice Ginsburg termed “common sense,” the Court held, by a vote of 6-3, that employees of contractors and subcontractors of publicly-traded companies can bring SOX actions when they suffer retaliation for disclosing what they reasonably believe to be a violation of an SEC rule, shareholder fraud, mail fraud wire fraud, or bank fraud.
Implications of the decision include: Read more
By David Doniger, Policy Director, Climate and Clean Air Program, Natural Resources Defense Council
This morning the Supreme Court will hear oral argument in its third case in the last seven years on climate-changing carbon pollution and the Clean Air Act. The earlier cases cemented EPA’s authority to tackle carbon pollution; this case concerns a secondary question about the Act’s permitting provisions. Every Supreme Court case is important, of course, but in this instance it’s critical to understand exactly what is at issue, and what is already settled.
First, what’s not at issue on Monday. The Supreme Court has already held twice that the Environmental Protection Agency has the authority and responsibility under the Clean Air Act to set emission standards for dangerous climate-changing greenhouse gases. The Court decided in Massachusetts v. EPA in 2007 that EPA can set carbon pollution standards for motor vehicles, and in 2011 the Court held that EPA can do the same for power plants and other industries in American Electric Power v. Connecticut.
This is the Clean Air Act authority that President Obama’s EPA used in his first term to make the science-based determination that carbon pollution endangers our health and environment, and to set landmark standards for new cars and trucks. He’s using that authority now, as part of the Climate Action Plan, to curb the two billion tons of carbon pollution coming each year from the nation’s power plants and to strengthen standards for heavy-duty trucks.
Far from the Republican narrative that President Obama is “bypassing Congress,” the president is carrying out his duty to faithfully execute the laws already on the books, that Congress already passed – in this case, the Clean Air Act.
The case on to be heard on Monday, Utility Air Regulatory Group v. EPA, grows out of those first-term actions on carbon pollution. After being smacked down in the Court of Appeals in Washington, industry trade groups, conservative states, and others asked the Supreme Court to reconsider its two earlier decisions, overturn EPA’s endangerment finding, block the clean car standards, and effectively also block EPA’s forthcoming power plant standards. Last October, the Court rejected each of these petitions.
With this third strike, EPA’s authority to set enforceable carbon pollution standards for cars, power plants, and other big industries is now 100 percent settled.
So what did the Supreme Court agree to review? The Court asked for briefs on just one issue: whether EPA’s vehicle emission standards triggered requirements for carbon-emitting industrial sources to obtain certain kinds of permits under other parts of the Clean Air Act.
There are two relevant permitting requirements under the Act.
The first is called “new source review,” and it is found in the Prevention of Significant Deterioration (PSD) provisions of the Act. Each new and modified major industrial source must get a construction permit before starting to build, showing that it will use the “best available control technology” (BACT) for “each pollutant subject to regulation” under the Act.
The second is called the “operating permit program,” and it is found in Title V of the Act. It requires each existing major industrial source to have an operating permit collecting in one place all of the emission limits and monitoring obligations that apply to the source.
What is the relationship between permits and standards?
Standards are fully enforceable on their own even if there are no permits. Plant operators have to report their emissions and show that they meet their standards, and violations bring fines and penalties.
Permits are important nevertheless. Construction permits are important because they establish BACT pollution limits for new or expanded sources when there is no standard. (EPA is only now developing carbon pollution standards for power plants, and standards for other industries will take longer.) And later, when a standard is a bit old and out of date, the plant-specific determination of BACT makes sure that big new plants will be built with up-to-date modern pollution controls.
Operating permits are important because they collect all applicable standards and requirements in one document, simplifying compliance and enforcement. But those standards are legally binding and enforceable even if there is no operating permit.
These permitting requirements apply to “major” sources – those that emit amounts of pollution above certain threshold amounts set forth in the law. The idea was that big polluters should be scrutinized more carefully than small ones, and that they can afford it.
The question the Supreme Court will consider is whether an industrial source can become “major” – and subject to these permitting and BACT requirements – because of its carbon pollution.
According to EPA and the Court of Appeals in Washington, the Clean Air Act makes no distinction between carbon pollution and other kinds of pollution. The words of the statute say that the permitting and BACT requirements apply to “any air pollutant” and “each pollutant subject to regulation.” So when EPA set the carbon pollution standards for vehicles, carbon dioxide (CO2) became a regulated pollutant just like sulfur dioxide, nitrogen oxides, or any other substance the Clean Air Act has controlled for decades. From then on, that meant major sources of CO2 had to obtain construction and operating permits.
The industry and state petitioners claim otherwise. They claim that CO2 is totally different from the pollutants Congress meant the permit requirements to cover, and that CO2 never triggers those requirements. In other words, a plant’s CO2 emissions, no matter how large, can never make that plant a “major” source and can never require it to get either construction or operating permits.
The industry groups and their conservative allies have thrown up a hodgepodge of arguments why the statutory words – “any air pollutant” and “each pollutant subject to regulation” – should be read to mean something other than what they say. But the challengers start well behind the 8-ball. The Supreme Court has already ruled, inMassachusetts and American Electric Power, that carbon dioxide and the other climate-changing pollutants are “air pollutants” under the Clean Air Act. The government and its allies (including NRDC) have filed briefs showing that “any” and “each” pollutant include climate-changing pollutants just like all others.
The only thing different about climate-changing pollutants is that fuel-burning sources emit a lot more CO2 than other pollutants. That doesn’t raise any questions about how you handle a new power plant, an oil refinery, or a natural gas processing plant. Their CO2 emissions are way, way above the statutory thresholds (100 or 250 tons per year, depending on the industry) that define a “major emitting facility.” There’s no reason not to require permits and BACT pollution controls for giant polluters like these.
So EPA decided to phase in the permitting requirements, starting with the biggest emitters – ones that release more than 100,000 tons of carbon pollution each year. Smaller sources don’t have to do anything, even if they emit more than 100 or 250 tons per year of CO2.
The industry groups and their allies profess to worry that EPA may someday require PSD permits for thousands of small CO2-emitting sources that have never needed permits before. This, they say, would be “absurd.” So they’re asking the Court to create a total permitting exemption for all sources of climate-changing pollutants – even for giant CO2 sources like power plants and oil refineries – despite the plain language of the law.
Hopefully, on Monday the Supreme Court will see through these efforts to hide power plants and oil refineries behind homes and grocery stores. The briefs show that EPA is actually implementing the permit requirements in a reasonable and responsible way – focusing on the biggest climate polluters that produce the vast majority of all the carbon pollution, while working on solutions that will avoid burdening small sources or clogging the permit system.
In the first two years that these requirements were in effect, fewer than 200 facilities nationwide, all of them big industrial projects, needed PSD permits because of their climate-changing pollution. That’s an average of two facilities per state per year. Not a single home, hospital, church, or grocery store has had to do a thing. So despite all the cries of alarm, the Clean Air Act’s permitting requirements are working just fine.
We’re confident that EPA and the Court of Appeals got it right – that the permitting requirements do apply to large industrial carbon pollution sources.
But the most important thing to remember is that the Supreme Court has already reaffirmed EPA’s authority and responsibility to act on the overwhelming science showing that carbon pollution is driving dangerous climate change.
President Obama deserves enormous credit for setting landmark clean car standards, for tackling the dangerous carbon pollution from our power plants, and for taking the other climate protection actions under the Climate Action Plan. These critical steps are not at issue in Monday’s argument, and they are essential to protect our children and grandchildren from a world turned upside down by climate change.