9th Circuit panel revives church’s suit against state over abortion coverage

A federal appellate panel revived a San Diego-area church's lawsuit challenging California's abortion coverage mandate Wednesday, ruling a district court judge was wrong to dismiss the case on jurisdictional grounds.

Skyline Wesleyan Church sued the state over its directive, claiming the Department of Managed Health Care's 2014 decision to send letters informing seven insurers that their plans had to include abortion coverage violated the church's free exercise of religion, among other claims.

The church, which opposes abortion, had previously been able to get health insurance coverage that did not require it to pay for the procedure. After the state agency's letters to its insurer, that option was eliminated, according to court documents. The church sued the department in the Southern District of California in 2016.

"We hold that Skyline has suffered an injury in fact," 9th Circuit Judge Michelle T. Friedland wrote for the panel. Skyline Wesleyan Church v. California Department of Managed Health Care et al., 2020 DJDAR 4518 (9th Cir., filed April 9, 2018).

"Before the letters were sent, Skyline had insurance that excluded abortion coverage in a way that was consistent with its religious beliefs," she added. "After the letters were sent, Skyline did not have that coverage, and it has presented evidence that its new coverage violated its religious beliefs. There is nothing hypothetical about the situation."

The decision does not decide the merits of the case, but reverses U.S. District Judge Cathy Ann Bencivengo's decision that she lacked jurisdiction over the church's federal free exercise of religion claim and other claims. Instead, the panel remanded the case back to her.

Attorneys for the church sought a ruling, not a remand, but Friedland wrote it would be premature to rule on the federal First Amendment claim because a pending U.S. Supreme Court case will decide the issue in a case involving a Philadelphia foster care agency and religious organizations that do not place children with same-sex couples. Fulton v. City of Philadelphia, Pennsylvania, 19-123 (S. Ct., filed July 22, 2019).

"When the Supreme Court is in the process of considering a legal issue central to an appeal before us, we typically wait to decide the appeal until after the Supreme Court has ruled," she wrote in Wednesday's ruling.

The high court may reconsider its 1990 ruling in a case that allowed the state of Oregon to deny unemployment benefits to two counselors for a private drug rehabilitation agency because they ingested peyote as part of a Native American religious ceremony. Employment Division v. Smith, 494 U.S. 872 (1990).

Jeremiah Galus, senior counsel of the Alliance Defending Freedom, which represents Skyline, hailed the 9th Circuit ruling in a statement as a victory against "unlawful, unjust government mandates."

"The Department of Managed Health Care shouldn't be forcing churches to pay for elective abortions," he said. "The agency has unconstitutionally targeted religious organizations, repeatedly collaborated with pro-abortion advocates, and failed to follow the appropriate administrative procedures to implement its abortion-coverage requirement."

Karli A. Eisenberg of the state attorney general's office, who argued the matter last fall, could not be reached for comment. During oral arguments, she argued the case lacked standing and said "it's not a purely legal question" and is instead "a fact-specific inquiry."

The dispute has also set up a conflict between the state, which maintains health insurers must include abortion as part of medical coverage plans, and the federal government.

In January, the U.S. Office of Civil Rights issued a notice of violation to the state, saying California cannot impose universal abortion coverage mandates on health insurance plans and issuers in violation of federal freedom of conscience laws.