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More First Amendment Violations from Obamacare, Thanks to HHS

Obamacare will drive up costs for most patients and insurance policyholders. Yet "health-insurance companies must tell customers who get a premium rebate this summer that the check is the result of the Obama administration's health-care law, according to federal guidelines released Friday. . . .Rules finalized by the Department of Health and Human Services on Friday instruct insurers to notify recipients of rebates in the first paragraph of the mailing by writing: 'This letter is to inform you that you will receive a rebate of a portion of your health insurance premiums. This rebate is required by the Affordable Care Act-the health reform law.'" Never mind that Obamacare has already caused sizeable hikes in insurance premiums for some policyholders.

Earlier, HHS Secretary Sebelius warned insurers not to inform policyholders that their premiums were rising due to Obamacare, even though that was the truth. Obama’s HHS secretary sought to gag insurers that disclosed how Obamacare’s mandates are increasing the cost of health insurance, even though such speech is clearly protected by the First Amendment, telling them if they did so, they could be excluded from health insurance exchanges. Prior to that, the Obama administration attempted to gag insurers from disclosing how Obamacare harms Medicare Advantage participants, drawing criticism from First Amendment experts like UCLA law professor Eugene Volokh, the author of two First Amendment textbooks.

Forcing companies to make politicized disclosures to customers implicates the First Amendment, as does interfering with the content of their speech to customers in billings. In International Dairy Foods v. Amestoy, 92 F.3d 67 (2d Cir. 1996), an appeals court struck down a Vermont law that required labeling for milk derived from animals treated with bovine growth hormones, where the labeling could not be justified on consumer deception or public health grounds.

 Similarly, in Bellsouth v. Farris, a federal appeals court struck down a Kentucky statute banning phone companies from listing on their phone bills a line-item charge breaking out the cost of a new state tax, even though it was technically the phone company, not the customer, that was liable for the tax, since the company argued that the tax increased the cost it ultimately charged the customer. The court held that the provision was unconstitutional even if its purpose was to avoid consumer confusion as to who bore legal responsibility for tax, since the company's speech did not concern unlawful activity, the state's ban did not apply to any other means of communication, and the state permitted same separate statements on other industries' bills.  The same seems to be true of HHS's regulation, which singles out a particular industry and particular means of communication for restrictions. (The First Amendment protects not only the freedom of speech, but freedom from compelled speech as well.)

The Supreme Court has said the First Amendment protects the free speech rights of businesses, even when they are government contractors, in cases like Board of County Commissioners v. Umbehr, 518 U.S. 668 (1996).  The First Amendment applies with greater force, however, when the speech restriction is imposed through a regulation, rather than tied to a discretionary government contract.  See, e.g., CarePartners, LLC v. Lashway, 545 F.3d 867, 872 (9th Cir. 2008).