St. Louis Effort for AIDS, et al v. Huff

Filing 36

ORDER AND OPINION granting in part 12 Motion for preliminary injunction; denying 28 Motion to Dismiss for Failure to State a Claim; denying parties' requests for oral argument. Signed on 1/23/14 by District Judge Ortrie D. Smith. (Wolfe, Steve)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
CENTRAL DIVISION
ST. LOUIS EFFORT FOR AIDS,
et al.,
Plaintiffs,
vs.
JOHN HUFF, Director of the
Missouri Department of Insurance,
Financial Institutions and
Professional Registration,
Defendant.

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Case No. 13-4246-CV-C-ODS

ORDER AND OPINION (1) GRANTING IN PART PLAINTIFFS’ MOTION FOR
PRELIMINARY INJUNCTION, (2) DENYING DEFENDANT’S MOTION TO DISMISS,
AND (3) DENYING PARTIES’ REQUESTS FOR ORAL ARGUMENT,
Pending is Plaintiffs’ Motion for Preliminary Injunction, which seeks to enjoin
Defendant (the Director of the Missouri Department of Insurance, Financial Institutions
and Professional Registration) from enforcing various provisions of Missouri’s Health
Insurance Marketplace Innovation Act (“HIMIA”). The Court concludes an injunction is
justified to enjoin enforcement of HIMIA insofar as it applies to entities and individuals
certified under federal law to provide services or perform functions pursuant to the
Affordable Care Act and its attendant regulations. Such entities and individuals
specifically include Counselor Designated Organizations, Navigators, and Certified
Application Counselors (collectively “Federal Counselors”). The Court reaches this
conclusion without holding a hearing or entertaining oral argument because (1) the
issues to be resolved are legal and not factual, (2) neither side has suggested there are
relevant factual issues to be resolved, and (3) the parties’ filings have sufficiently
addressed the legal issues.

I. BACKGROUND

“In 2010, Congress enacted the Patient Protection and Affordable Care Act, 124
Stat. 199 [(the ‘ACA’)]. The Act aims to increase the number of Americans covered by
health insurance and decrease the cost of health care.” National Federation of
Independent Business v. Sebelius, 132 S. Ct. 2566, 2580 (2012); see also 42 U.S.C. §
18091. Individuals who cannot obtain qualified health plans (“QHPs”) from their
employer, including “part-time employees, self-employed individuals, and unemployed
individuals are steered to the insurance exchanges established under the ACA, where
the government offers subsidies to those who cannot shoulder the full cost of insurance
on their own.” Korte v. Sebelius, 735 F.3d 654, 728 (7th Cir. 2013). As part of providing
QHPs, the exchanges provide the opportunity for individuals and employers to compare
various health plans.
The ACA provides a mechanism for states to establish these exchanges, e.g., 42
U.S.C. § 18031(b), but in those states that chose not to do so the Secretary of Health
and Human Services (“HHS”) is responsible for establishing and operating the
exchange. E.g., 42 U.S.C. § 18041(c)(1); 78 Fed. Reg. 42824. The federal exchange
is often referred to as a “Federally Facilitated Exchange” or “FFE.” HHS must contract
with appropriate not-for-profit entities in the state to operate the FFE. 42 U.S.C. §
18041(c)(1).
All exchanges – whether they are FFEs or created by the state – share certain
requirements. Obviously, in the case of an FFE it is the federal government – through
HHS – that is responsible for meeting those requirements. Included in the requirements
is the creation of a Certified Application Assistance Program consisting of some
combination of (1) Certified Application Counselors (“CACs”) and (2) Navigators. The
duties of CACs and Navigators are spelled out in the ACA, and are further refined in
HHS regulations. Those regulations also regulate the conduct of CACs and Navigators.
For instance, exchanges are required to create a “certified application counselor
program” by either designating organizations to certify counselors or directly certifying
members or individuals of other organizations. 45 C.F.R. §§ 155.225(a), 155.225(b)(2).
Standards for certification and the counselors’ obligations are further specified in the
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regulation. Id. § 155.225(d). The Exchange is responsible for overseeing counselors
and must create a procedure for withdrawing certification if it finds a counselor has
violated the regulations. Id. § 155.225(e). Similarly, an exchange “must establish a
[Federal] Navigator program . . . through which it awards grants to eligible public or
private entities or individuals” as described in applicable regulations. 45 C.F.R. §
155.210(a). In the course of doing so, the exchange must establish standards and a
course of training for Navigators. Id. § 155.210(b); see also 42 U.S.C. § 18031(i)(4).
Thus, those entities and individuals previously defined in this Order as Federal
Counselors – Counselor Designated Organizations, Navigators, and Certified
Application Counselors – are all certified, approved, and subject to oversight by HHS
either directly or indirectly.
Plaintiffs St. Louis Effort for Aids and Planned Parenthood of the St. Louis
Region and Southwest Missouri (the “CAC Plaintiffs”) are Counselor Designated
Organizations, CACs, and Navigators under the ACA; they also employ individuals who
are certified as CACs and Navigators. It also appears the CAC Plaintiffs are tasked with
training Navigators. E.g., Complaint, ¶¶ 7-8; Plaintiffs’ Exhibit 1 at ¶¶ 4, 6; Plaintiffs’
Exhibit 2 at ¶¶ 4, 6. Plaintiffs’ Suggestions at 2, 14. The remaining Plaintiffs are:
Consumers Council of Missouri, Missouri Jobs with Justice, Jeanette Oxford, Dr. Wayne
Letizia, Dr. William Fogarty, and Chris Worth. These individuals and entities are not
described as CACs, Navigators, or any other Federal Counselor certified under the
ACA.
The State of Missouri opted not to create an exchange, so HHS created and
operates the FFE in Missouri. Missouri subsequently passed the Health Insurance
Marketplace Innovation Act of 2013 (“HIMIA”), which regulates the conduct of those
performing duties on behalf of the FFE. All Plaintiffs seek to enjoin certain provisions of
HIMIA, arguing the provisions (1) are preempted and violate the Supremacy Clause, (2)
violate the First Amendment, and (3) violate the Due Process Clause. Defendant filed a
motion to dismiss, contending that his arguments against the preliminary injunction
demonstrate Plaintiffs have failed to state a cause of action for which relief can be
granted. The Court will focus on the preemption/Supremacy Clause issues because
they are dispositive of the issues raised in the motions.
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II. DISCUSSION

A. Standards

1. Preliminary Injunctions

“A preliminary injunction is an extraordinary remedy and the burden of
establishing the propriety of an injunction is on the movant.” Watkins Inc. v. Lewis, 346
F.3d 841, 844 (8th Cir. 2003) (internal citation omitted). In deciding whether to grant or
deny a motion for preliminary injunction, the Court must consider four factors: (1) the
movant’s likelihood of success on the merits; (2) the irreparable harm the movant will
suffer if preliminary relief is not granted; (3) the balance of hardships to the parties; and
(4) the impact of the injunction on the public interest. Winter v. Natural Resources
Defense Council, Inc., 555 U.S. 7, 20 (2008); Dataphase Sys., Inc. v. CL Sys. Inc., 640
F.2d 109, 114 (8th Cir. 1981) (en banc). The first factor is the most important, Shrink
Missouri Government PAC v. Adams, 151 F.3d 763, 764 (8th Cir. 1998), and it is the one
that has garnered virtually all of the parties’ attention.

2. Preemption

Federal law is capable of preempting state law because of the Supremacy
Clause’s command that federal law is the supreme law of the land. Congress can
expressly preempt state law by including appropriate language in a statute; preemption
also occurs by implication. However, these categories are not “rigidly distinct.” Crosby
v. National Foreign Trade Council, 530 U.S. 363, 372 n.6 (2000). In this case, both
categories are arguably implicated. With that said, the Court notes the ACA provides
little force of its own as all it says on the subject is that it does not “preempt any State
law that does not prevent the application of the provisions of” the ACA, 42 U.S.C. §
18041(d) – which implies that it does preempt any State law that prevents the ACA’s
operation, and in that sense the statute does little more than invoke conflict preemption.

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“Conflict preemption occurs when compliance with both federal and state laws is
impossible, and when a state law ‘stands as an obstacle to the accomplishment and
execution of the full purposes and objectives of Congress.’” Keller v. City of Fremont,
719 F.3d 931, 940 (8th Cir. 2013) (quoting Arizona v. United States, 132 S. Ct. 2492,
2501 (2012)); see also Lefaivre v. KV Pharm. Co., 636 F.3d 935, 939 (8th Cir. 2011).
“To determine whether a state law conflicts with Congress’ purposes and objectives, we
must first ascertain the nature of the federal interest.” Hillman v. Maretta, 133 S. Ct.
1943, 1950 (2013). “What is a sufficient obstacle is a matter of judgment, to be
informed by examining the federal statute as a whole and identifying its purpose and
intended effects.” Crosby, 530 U.S. at 373.
“[T]he entire scheme of the statute must of course be considered and that
which needs must be implied is of no less force than that which is
expressed. If the purpose of the act cannot otherwise be accomplished –
if its operation within its chosen field must be frustrated and its provisions
be refused their natural effect – the state law must yield to the regulation
of Congress within the sphere of its delegated power.”
Id. (quoting Savage v. Jones, 225 U.S. 502, 533 (1912)).
The ACA’s purpose has been referenced earlier – it is a Congressional measure
designed to increase the availability and lower the cost of health care. The specific
aspects of the ACA at issue in this case relate to the Government’s operations of the
FFE, which are a means to the ACA’s overall objective. Thus, state laws that make
operation of the FFE more difficult or onerous run afoul of the ACA’s purpose and are
subject to preemption.

B. Application of the Requirements for Preliminary Injunctions

1. Likelihood of Success on the Merits

Plaintiffs’ claims arise from the following thesis: HIMIA (1) frustrates the ACA’s
purpose by imposing additional burdens upon them as duly designated Federal
Counselors and (2) creates a risk that they will be punished because HIMIA forbids

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them from performing their duties required under the ACA. The Court concludes the
CAC Plaintiffs (St. Louis Effort for Aids and Planned Parenthood) are likely to succeed
on this claim, but not the other Plaintiffs.

(a) HIMIA’s Application to Plaintiffs

HIMIA applies to certain individuals and entities; the term used for those
individuals and entities is “Navigator,” but the reader is cautioned that the term has a
different meaning under HIMIA than it does under the ACA. In an attempt to minimize
confusion, the Court shall employ the terms “State Navigator” and “Federal Navigator”
to differentiate them.
Defendant argues there can be no preemption because HIMIA does not apply to
Plaintiffs. Notwithstanding the fact that Defendant is charged with enforcing the statute,
the Court concludes this contention is plainly wrong – at least, with respect to the two
CAC Plaintiffs (St. Louis Effort for Aids and Planned Parenthood).
The first sentence in Section 376.2000(4) of the Revised Missouri Statutes
contains several definitions of who is a State Navigator. The first definition contains a
broad description, and the remainder of the sentence adds to the initial definition by
specifying individuals and entities that are also to be included. The first definition
describes a State Navigator as one who “for compensation, provides information or
services in connection with eligibility, enrollment, or program specifications of any health
benefit exchange operating in this state.” Defendant argues HIMIA does not apply to
the CAC Plaintiffs – so there is no potential for conflict with the ACA – because Plaintiffs
are not operating for compensation. There are several flaws with this argument. First
and foremost, it ignores that the CAC Plaintiffs are compensated for their work: they
receive grants from HHS to perform their duties as Federal Counselors.
Second, the argument focuses exclusively on the first definition. The second
clause specifies that the definition of State Navigator includes “any person selected to
perform the activities and duties identified in 42 U.S.C. 18031(i) in this state . . . .” 42
U.S.C. § 18031(i) is the ACA provision that defines, describes, and empowers Federal
Navigators. Thus, by specifying that Federal Navigators are State Navigators, HIMIA
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defeats any argument that Federal Navigators generally – or the CAC Plaintiffs
specifically – can avoid HIMIA by claiming they are not being compensated. And, lest
there be any doubt, the ensuing clause defines a State Navigator as “any person who
receives funds from [HHS] to perform any of the activities and duties identified in 42
U.S.C. 18031(i) . . . .” Certainly, the grants bestowed by HHS constitute “funds.”
The rest of the first sentence cements the conclusion that Defendant’s view of
HIMIA’s scope is too narrow. The final clause broadly includes within the definition of
State Navigator “any other person certified by [HHS], or a health benefit exchange
operating in this state, to perform such defined or related duties irrespective of whether
such person is identified as a navigator, certified application counselor . . . or other title.”
This provision includes any Federal Counselor, regardless of whether any grants,
compensation, or funds are provided.1
Defendant’s second argument relies on section 376.2004(4)’s final sentence.
This sentence provides that State Navigator does not include “any not-for-profit entity
disseminating to a general audience public health information.” Defendant contends –
without explanation – that this sentence means the CAC Plaintiffs are not State
Navigators. However, the CAC Plaintiffs are not disseminating “public health
information,” but rather information about QHPs and options available under the FFE.
Moreover, it is not clear what a “general audience” is, but to the extent the CAC
Plaintiffs must provide counseling, advice and information on an individualized level, it
appears likely this requirement is not met. Thus, section 376.2004(4)’s final sentence
does not exclude the CAC Plaintiffs from the definition.2

1

HIMIA’s repeated references to federal statutes further establishes an intent to
“plug into” the ACA and describe Federal Counselors, regardless of how they are
characterized and regardless of how adequately described by the first sentence’s initial
definition.
2

While not clearly stated, Defendant may be contending that if a not-for-profit
entity ever disseminates public health information to a general audience, that entity is
automatically excluded even if they otherwise meet the definition of a State Navigator.
If this is Defendant’s argument, the Court would reject it because the more logical and
natural interpretation of the final sentence is that a not-for-profit entity is excluded so
long as all it does is disseminate public health information to a general audience. The
sentence does not suggest that an entity that qualifies as a State Navigator is excluded
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The Court concludes HIMIA includes the CAC Plaintiffs as State Navigators for
the following independent reasons: (1) they receive compensation in connection with a
health benefit exchange, (2) they have been selected to perform the duties of Federal
Navigators, (3) they receive grants from HHS to perform the duties of Federal
Navigators, (4) they have been certified by HHS to perform duties related to the
exchange, and (5) their function is not limited to disseminating public health information
to a general audience.
On the other hand, the Court agrees with Defendant’s argument insofar as it
suggests HIMIA does not apply to the remaining Plaintiffs. Nothing suggests that any of
the other Plaintiffs are Federal Counselors. The Complaint’s description of these
Plaintiffs also does not suggest they are receiving any compensation for doing anything
in connection with the FFE. The other Plaintiffs suggest HIMIA applies to them because
it requires licensing of anyone who performs the services of a State Navigator – even by
those who are not State Navigators. However, reading all of HIMIA’s provisions
together suggests that only those who are State Navigators under state law must be
licensed – and there is no indication that any plaintiffs other than the CAC Plaintiffs
qualify as State Navigators.
Although Plaintiffs written arguments do not explain how HIMIA applies to or
otherwise affects them, the Court has reviewed Exhibits 3 through 8. These materials
also fail to demonstrate HIMIA applies to or affects the other Plaintiffs.


Some of the other Plaintiffs (notably, Consumers Council of Missouri, Missouri
Jobs with Justice, Doctors Letizia and Fogarty, and Ms. Oxford) provide
information about eligibility, enrollment, or program specifications of QHPs, the
ACA, or the FFE, but none of them claim to do so “for compensation.”



In addition to the preceding observation, HIMIA’s licensing requirement does not
apply to Plaintiffs Dr. Wayne Letizia and Dr. William Fogarty because they are
health care providers. Mo. Rev. Stat. § 376.2002.4(3).3

simply because it also, at other times, happens to disseminate public health information
to a general audience.
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Dr. Letizia or Dr. Fogarty would lose this exception if they are certified as
Federal Navigators – but in that case, this Preliminary Injunction would protect them.
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

Plaintiff Chris Worth does not profess to disseminate information, but rather
expresses a desire to obtain information from a “healthcare attorney.” Licensed
attorneys are not required to be licensed as State Navigators, Mo. Rev. Stat. §
376.2002.4(2), so HIMIA does not impair Worth’s ability to get information about
his ACA options.

In the absence of further explanation (which is absent from Plaintiffs’ filings)4 the Court
has no basis for believing the other Plaintiffs are likely to demonstrate HIMIA imposes
any restrictions or requirements upon them. The Court therefore concludes the other
Plaintiffs have not demonstrated they are likely to succeed on the merits.5

(b) Licensing Requirements

HIMIA precludes any State Navigator from performing any duties whatsoever
unless they have been licensed by the state, Mo. Rev. Stat. § 376.2002.1, or unless the
licensing requirement is obviated by section 376.2002.2. HIMIA imposes requirements
for obtaining a license. Id. § 376.2004. HIMIA also imposes continuing education
requirements for State Navigators. Id. § 376.2006. The CAC Plaintiffs have already
complied with federal regulations governing their ability to serve as Federal Counselors,
but in order to perform the functions approved and required by HHS they must also
comply with HIMIA’s additional requirements. Without delving further, it seems obvious
these additional requirements obstruct the federal government’s operation of the FFE
and for that reason alone HIMIA is preempted insofar as it applies to the CAC Plaintiffs.
Defendant offers no real argument against this reasoning – beyond contending
HIMIA does not apply to the CAC Plaintiffs, which as noted is not the case. Defendant
also contends it is possible to comply with both federal law and state law. Of course, it
4

This absence does not justify holding a hearing or permitting oral argument. It is
not that Plaintiffs’ argument is unclear or requires proof: the problem is that Plaintiffs
have presented no argument. Oral argument cannot be used to present arguments that
are not presented in a party’s written submissions.
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This conclusion would not change if the Court considered the First Amendment
or Due Process arguments. Those arguments, like the preemption/Supremacy Clause
argument, rest on first concluding HIMIA affects the Plaintiffs in some manner.
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is theoretically possible for the CAC Plaintiffs to obtain a State Navigator license – but
this contention actually proves the violation. The question at hand is not whether it is
possible for Federal Counselors to meet HIMIA’s licensing requirements; the question is
whether the requirement that Federal Counselors comply with additional state
regulations imposes additional burdens that frustrates the federal purpose. The Court
concludes HIMIA’s requirement that federally approved/licensed individuals and entities
must also comply with additional licensing requirements constitutes an impermissible
obstacle. Cf. California v. Federal Energy Regulatory Comm’n, 495 U.S. 490 (1990)
(state requirements for minimum stream flow preempted by federal law permitting
Federal Energy Regulatory Commission to license hydroelectric plant because state
requirement obstructs federal agency’s licensing authority); Ray v. Atlantic Richfield
Co., 425 U.S. 151 (1978) (Secretary of Transportation’s authority to establish vessel
size and speed limitations for tug boats preempts state law setting such standards);
Heart of America Grain Inspection Serv., Inc. v. Missouri Dep’t of Agriculture, 123 F.3d
1090 (8th Cir. 1997) (state could not set rules for weighing grain in federally licensed
grain warehouses).

(c) HIMIA’s Limitations on State Navigators

HIMIA’s licensing and additional requirements are arguably the least serious
obstacles to the ACA’s Congressional objectives. Far more significant are HIMIA’s
limitations on what State Navigators may do.
Section 376.2002.2 describes functions that all State Navigators may perform.
However, section 376.2002.3 sets forth functions a State Navigator may not perform
unless they are also licensed as an “insurance producer” under state law. An
“insurance producer” is, essentially, an insurance agent or an insurance company. Mo.
Rev. Stat. §§ 375.012(6), 376.014. Thus, there are certain functions HIMIA precludes
Federal Counselors from performing unless they are also licensed as insurance agents.
The problem is that federal law requires Federal Counselors to perform some of those
functions precluded by HIMIA.

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For instance, section 376.2002.3(3) precludes State Navigators who are not
licensed as insurance agents from providing “advice concerning the benefits, terms and
features of a particular health plan or offer advice about which exchange health plan is
better or worse for a particular individual or employer.” However, Federal Navigators
are required to “distribute fair and impartial information concerning enrollment in” health
plans and about “the availability of premium tax credits . . . .” 42 U.S.C. §
18031(i)(3)(B). CACs have a similar requirement. 45 C.F.R. § 155.225(c)(1). Federal
Navigators are also required to “[f]acilitate selection of a QHP.” 45 C.F.R. §
155.210(e)(3). Defendant denies the existence of a conflict, arguing that CACs and
Federal Navigators can provide “information” and “facilitate” without providing “advice.”
On the surface, the distinction – assuming it exists – is impossible to define. The
difficulty is augmented when one considers the nature of the “information” Federal
Counselors must provide. Providing information about various plans – which
necessarily requires providing information about the differing strengths, weaknesses,
and other contrasting features – is indistinguishable from “advice.”
Section 376.2002.3(5) precludes State Navigators who are not insurance agents
from “[p]rovidi[ing] any information or services related to health benefit plans or other
products not offered in the exchange.” However, Federal Navigators are required to
provide information about options, including those that are not in the exchange. 45
C.F.R. § 155.210(e)(2). The two requirements obviously conflict.
In addition to the licensing and other requirements, HIMIA dictates that State
Navigators advise persons with private insurance to “consult with a licensed insurance
producer regarding coverage in the private market.” Mo. Rev. Stat. § 376.2008.
Plaintiffs first characterize this requirement as a limitation on their ability to function, but
the Court is not convinced. Section 376.2008 seems to only require that State
Navigators refer people who have private insurance to talk to the provider to obtain
information about that coverage; by itself, the provision does not preclude anyone from
doing anything. Plaintiffs then contend this requirement is inconsistent with the ACA,

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but again the Court is not convinced.6 Nonetheless, the Court is of the view that any
attempt by Missouri to regulate the conduct of those working on behalf of the FFE is
preempted. The ACA provides states an opportunity to create exchanges; it also
provides an avenue for states and HHS to jointly operate an exchange. Missouri has
opted not to be in the health insurance exchange business. Having made the choice to
leave the operation of the exchange to the federal government, Missouri cannot choose
to impose additional requirements or limitations on the exchange. Doing so frustrates
Congress’ purpose of having HHS operate FFEs in states where no exchange exists.
Thus, section 376.2008 is preempted to the extent it attempts to regulate the conduct of
Federal Counselors.
Defendant argues there is no problem with these provisions because the CAC
Plaintiffs can simply become licensed as insurance agents. Presenting the argument
demonstrates its flaw: the suggestion that those designated to operate the FFE can do
so only if they are also licensed as insurance agents demonstrates that the state law
obstructs the federal purpose. The ACA requires HHS to contract with not-for-profit
entities, and further precludes Federal Navigators from receiving compensation from
insurance companies. 42 U.S.C. § 18031(i)(4)(ii). Thus, HHS cannot utilize insurance
agents to operate the FFE. This means HHS must find willing not-for-profit entities that
are already licensed as insurance agents but who are not actually receiving
compensation from an insurance company (an unlikely proposition at best) or HHS must
find willing not-for-profit entities that are willing and able to become certified as
insurance agents under Missouri law. Clearly, requiring Federal Counselors to be
licensed insurance agents is a significant roadblock to the ACA.
In conclusion, the Court holds the CAC Plaintiffs are likely to succeed on their
claim that HIMIA is preempted insofar as it applies to entities and individuals certified
under federal law to provide services or perform functions pursuant to the ACA and its
attendant regulations, including specifically federally approved/certified CACs,
Navigators, and Counselor Designated Organizations. The Court is not persuaded the

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Plaintiffs also invoke the First Amendment, contending the statute violates their
rights by forcing speech. The Court’s resolution of the preemption issues makes it
unnecessary to consider Plaintiffs’ likelihood of success on this theory.
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remaining Plaintiffs are likely to succeed on any of their claims because they are not
likely to successfully demonstrate HIMIA applies to or affects any of them.

(d) HIMIA’s Breadth

Plaintiffs contend HIMIA conflicts with the ACA by allowing individuals to be State
Navigators who could not qualify as Federal Counselors. For instance, the ACA
provides that one cannot be a Federal Navigator if one “receive[s] any consideration
directly or indirectly from any health insurance issuer in connection with the enrollment
of any qualified individuals or employees of a qualified employer in a qualified health
plan.” 42 U.S.C. § 18031(i)(4)(ii); see also 45 C.F.R. § 155.210(d). HIMIA includes no
such prohibition on State Navigators; to the contrary (and as discussed above) a State
Navigator is limited in what it can do unless it is also licensed as an insurance producer.
Defendant counters that the general standards for Federal Navigators set forth in 42
U.S.C. § 1803(i)(2) do not preclude insurance agents or companies from being Federal
Navigators – but Defendant never addresses the statutory provision Plaintiffs cite.
Regardless, the Court discerns no reason to delve further into this issue7
because even if Plaintiffs are correct in their reasoning they are not entitled to prevail
because HIMIA’s “expansive” definition of State Navigators has no effect upon them.
One may regard this as an issue of standing; one may also regard this as an issue
related to irreparable harm (the next issue to be addressed in this Order). Regardless,
Plaintiffs have not demonstrated why they are entitled to a preliminary injunction

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If the argument’s merits needed to be examined, the Court would require
Plaintiffs to explain why the requirements to be a State Navigator must track the
definition for a Federal Navigator – particularly in light of the Court’s holding that the
State is precluded from establishing standards for a Federal Navigator. In other words,
so long as the State is precluded from setting requirements for or regulating conduct of
Federal Navigators, what difference does it make who Missouri allows to be a State
Navigator? Plaintiffs state, in a conclusory manner, that allowing this “undermines” their
work, Plaintiffs’ Suggestions at 9, but provide no further explanation. Nothing in the
ACA has been identified to the Court as prohibiting non-Federal Counselors from talking
about the ACA or available options, nor is there any suggestion that State Navigators
are permitted to falsely suggest they are designated or certified by HHS.
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precluding Defendant from allowing those who meet the definition of State Navigator to
be certified as such.

2. Irreparable Harm

The Court concludes the CAC Plaintiffs have demonstrated they face irreparable
harm because they must overcome HIMIA’s hurdles in order to operate. They also face
irreparable harm because even if they comply with HIMIA’s licensing requirements they
risk violating HIMIA simply by performing their federally-mandated functions. The
Court’s prior discussion points out these risks. Augmenting these risks are HIMIA’s
enforcement provisions. See Mo. Rev. Stat. § 376.2010. First, Defendant may fine any
State Navigator who violates HIMIA. Defendant may also suspend the license of State
Navigators that violates HIMIA – thereby precluding them from performing their
functions in connection with the FFE (because, as stated, HIMIA requires Federal
Counselors to be licensed as State Navigators). Setting aside the question as to
whether this is an independent violation of the Supremacy Clause (as it bestows state
officials the power to stop the federal government’s agents and those approved by the
federal government from performing their functions), the CAC Plaintiffs face a genuine
risk of harm if they, for instance, provide information that contrasts various health
coverage options because doing so may constitute “advice” in violation of HIMIA – and
if they do not present this information they have violated their obligations as Federal
Counselors. Second, Defendant is also empowered to fine or suspend State Navigators
“for good cause.” Defendant argues this phrase is subject to limiting principles but does
not suggest what those limitations might be. Setting aside the potential Due Process
implications of such a roving commission to punish, the Court readily discerns a threat
of irreparable harm.
Alternatively, the CAC Plaintiffs could adhere to HIMIA’s restrictions and risk
losing their grants. Defendant argues the fact that the CAC Plaintiffs have obtained
licenses as State Navigators proves there is no threat – but this (1) does not mean that
requiring them (or other Federal Counselors) to do so is permissible under the
Supremacy Clause and (2) does not demonstrate the CAC Plaintiffs (or other Federal
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Counselors) can actually perform their federally-required functions without violating
HIMIA’s restrictions. The Court holds the CAC Plaintiffs have established they face
irreparable harm.

3. Balance of Hardships

The Court discerns no hardship to Defendant if he is precluded from enforcing
HIMIA as to those who are authorized under federal law. Defendant’s arguments to the
contrary really relate to the fourth factor and will be discussed in that context.

4. Public Interest

As noted, the CAC Plaintiffs and other Federal Counselors must overcome
obstacles that cannot withstand constitutional scrutiny in order to perform their federallyrequired obligations. In addition, the Federal Counselors are faced with (1) a genuine
risk of punishment if they perform those federally-required obligations and (2) a loss of
their status as Federal Counselors if they do not. All of this serves to undermine the
public interest, given the myriad of deadlines for Missouri citizens to comply with the
ACA.
Defendant echoes the concern that Missouri citizens must be able to comply with
the ACA, but contends HIMIA is necessary to “ensure[ ] that the people assisting are
qualified to do so” and expresses fear that an injunction “would potentially allow
unqualified individuals and nefarious scam artists to go undetected . . . .” Defendant’s
Suggestions at 26. However, federally-approved Navigators, CACs and Counselor
Designated Organizations are qualified in that they have satisfied the requirements of
federal law. Defendant does not explain why HHS’ approval is insufficient to meet the
public interest, or why HIMIA is necessary to accomplish the public interest. On the
other hand, the public interest is damaged if the state is permitted to thwart federallyapproved Navigators, CACs and Counselor Designated Organizations from performing
their functions (either by making it difficult for them to function or by creating compliance
dilemmas that prevent them from performing their functions). The Court concludes the
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public interest is not harmed by granting the injunction, and that the public interest is
actually promoted by granting the injunction, removing the state-created specter of
punishment and regulation that likely violates the Constitution, and permitting the FFE to
operate as intended by the ACA.

C. Motion to Dismiss

Defendant filed a Motion to Dismiss, contending Plaintiffs failed to state a claim
for which relief could be granted. The motion incorporates Defendant’s arguments
against the preliminary injunction. The motion (Doc. # 28) is denied because (1) the
Court rejects most of Defendant’s arguments and (2) none of Defendant’s arguments
demonstrate Plaintiffs have failed to state a claim for which relief can be granted. At
best, Defendant’s arguments relate to the merits – but a merits-based argument does
not justify dismissal under Rule 12(b)(6).

III. CONCLUSION

The Court concludes Plaintiffs are likely to prevail on their claim that HIMIA is
preempted to the extent that HIMIA applies to federally-approved Navigators, CACs and
Counselor Designated Organizations. Accordingly, Defendant is preliminarily enjoined
from enforcing HIMIA as to those entities. The Court discerns no justification for
requiring Plaintiffs to post a bond. The Motion to Dismiss is denied.

IT IS SO ORDERED.

/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT

DATE: January 23, 2014

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