Requiring Insurers To Give Policies to Same-Sex Couples and DOMA

March 14th, 2014

Earlier I blogged about the government’s most recent change to Obamacare in a blog post. (It is Friday after all–perfect timing for a change!). Now, insurers will be required to issue policies to same-sex couples who were married in a state where gay marriage is legal, at the same rates as a opposite-sex couple. In other words, insurers are no longer able to issue policies based on actuarial rates for domestic partners, as opposed to married couples (these may vary).

Yet, this change raises an issue that the blog post did not address. How does this work in states where the state constitution prohibits the recognition of any same-sex unions. This may surprise you, but even with Obamacare in place, under McCarran-Ferguson, the states have huge amounts of autonomy in regulating their own insurance industries, and Congress has to actually displace state law through statute (not blog post).

For example, in Virginia (where the ruling striking down the constitutional prohibition on same-sex marriage was stayed), the definition of spouse pursuant to regulations from the Board of Insurance is limited to opposite-sex couples. The constitutional amendment specifically voids any same-sex union in all “contractual rights,” including insurance policies. I don’t think HHS through a blog post can force the states, and their insurance codes, to redefine their regulations. Yet, according to the PDF, this is exactly what HHS means:

We also expect States to begin enforcing the regulations in accordance with this clarification no later than for plan or policy years beginning on or after January 1, 2015.

The insurance companies can’t sell policies that the states have not approved. So in other words, the Feds, by blog post, have forced the states to do something their state constitutions may prohibit.

(I use Virginia here because my good friend Adina is an expert in Virginia health policy, but I’m sure the same reasoning applies across the country).

Furthermore, how does DOMA play into this? Under the government’s position post-Windsor, they have redefined all definitions of marriage for federal purposes as including same-sex couples. But DOMA would seem to explicitly prevent the Feds from changing state definitions! Under existing law, and Windsor itself, it is the states that can define these things. And the blog post does not even purport to say that this change is required by Windsor, or the Constitution. So what is the authority for this change?

Of course, under the current Administration’s view of the supremacy clause, a blog post trumps the Defense of Marriage Act and a State Constitution, so this is a fairly easy case.