Health insurance companies will not be able to discriminate against applicants for coverage, a federal appeals court ruled today.
The ruling, by a three-judge panel of the U and S appeals courts for the Northern District of California, applies to state-run health care facilities and insurers.
The decision is the latest setback to efforts by Republican-led states to pass Obamacare, which has been blamed for causing the rising number of Americans without insurance.
It follows a similar decision by a four-judges panel in Texas in April.
The lawsuit was filed in January by three health care organizations, including the American Medical Association and the American Hospital Association.
In a brief in support of the plaintiffs, the federal appeals panel said the government cannot prohibit insurers from discriminating against applicants on the basis of their race, gender, religion, disability or medical condition.
“It is simply not true that a health care plan that provides care for a substantial number of persons is a ‘health care plan’ for purposes of the statute,” wrote Judge Katherine Forrest of the 9th U.C.C., which handles insurance and employment disputes.
“In order to provide a substantial pool of health insurance coverage, the Plan must offer a wide variety of coverage options and must cover an adequate number of individuals.”
The ruling said that the U,S.
Department of Health and Human Services has authority to regulate discrimination in the health care market.
It said the HHS can prohibit insurers or health care providers from discriminating in their coverage decisions on the bases of race, religion or sex.
“The court cannot conclude that the HHS cannot regulate discriminatory practices in the insurance market by prohibiting insurers from excluding or excluding certain individuals,” Forrest wrote.
The judge ruled that insurers must comply with federal regulations prohibiting discrimination in health care.
The federal appeals courts in Colorado and New York have blocked similar lawsuits by insurers, saying they are too speculative to establish a precedent for a broader rule on the issue.
The appeals court said it was willing to review the judge’s order.
The states of Alaska and California have appealed the ruling to the U of S Supreme Court.
The panel of judges also found that the challengers failed to show that the health insurers’ claims of unlawful discrimination are based on an unreasonable belief or a “clear and articulable suspicion” that a person of a particular race or color is ineligible for insurance coverage.
The groups are asking the Supreme Court to reconsider the panel’s ruling.
“This is a significant ruling, but one that has the potential to protect consumers and prevent insurers from making discriminatory decisions on behalf of their customers,” said Tom Price, president of the American Health Care Association.
“We hope the Supreme, in a timely fashion, will review and reverse the panel ruling and allow the court to consider the constitutionality of this important, but untested, new policy.”
The American Hospital Associations has said that its members have filed more than 3 million health care claims, and that about 50,000 have been denied coverage because of discrimination.
In its ruling, the panel also found the plaintiffs lacked standing to sue because they had not yet established that they were injured by discrimination.
The court’s opinion did not address whether the plaintiffs could raise other types of claims.