Southern District of Mississippi Cites End of Chevron Deference to Enjoin HHS From Enforcing Section 1557 Gender Identity Protections

On July 3, 2024, the Southern District of Mississippi issued an order granting 15 states’ (Tennessee, Mississippi, Alabama, Georgia, Indiana, Kansas, Kentucky, Louisiana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, Virginia, and West Virginia) motion for a stay and preliminary injunctive relief against HHS’s May 6, 2024 final rule on Nondiscrimination in Health Programs and Activities (May 2024 Rule), 89 Fed. Reg. 37,522 (May 6, 2024).challenged The May 2024 Rule interpreted  Section 1557 of the ACA, which prohibits discrimination on the “basis of sex” in benefit and education programs that receive federal funds and clarified that discrimination on the basis of sex includes sex characteristics, intersex traits, pregnancy and related conditions, sexual orientation, gender identity, and sex stereotypes. The plaintiff states argued that the May 2024 Rule would require them to use taxpayer funds to pay for “costly gender-transition surgeries” and other “gender-transition interventions.” 

In its decision, the court cited the Supreme Court’s recent Loper decision to find that HHS’s interpretation of Section 1557 was not entitled to Chevron deference, even though HHS did not ask the Court for such deference. The court then conducted its own statutory analysis, and concluded that the states are likely to succeed on the merits of their claims. The Court stayed the effective date of the May 2024 Rule and enjoined HHS nationwide from enforcing it, but only with respect to the rule’s provisions on gender identity. The Eastern District of Texas and Middle District of Florida issued similar orders on the same day.