Land of Lincoln Mutual Health Insurance Company, An Illinois Non- Profit Mutual… v. United States

United States Court of Appeals
for the Federal Circuit
______________________
LAND OF LINCOLN MUTUAL HEALTH
INSURANCE COMPANY, AN ILLINOIS NON-
PROFIT MUTUAL INSURANCE CORPORATION,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2017-1224
______________________
Appeal from the United States Court of Federal
Claims in No. 1:16-cv-00744-CFL, Judge Charles F.
Lettow.
______________________
Decided: June 14, 2018
______________________
J ONATHAN MASSEY , Massey & Gail LLP, Washington,
DC, argued for plaintiff-appellant. Also represented by
D ANIEL P. ALBERS , Barnes & Thornburg LLP, Chicago, IL;
SCOTT E. P ICKENS , Washington, DC.
ALISA BETH K LEIN, Appellate Staff, Civil Division,
United States Department of Justice, Washington, DC,
argued for defendant-appellee. Also represented by CHAD
A. READLER, AUGUST E. F LENTJE, MARK B. STERN,
CARLEEN MARY ZUBRZYCKI.

-- 1 of 6 --

LAND OF LINCOLN MUTUAL HEALTH v. UNITED STATES 2
BARAK BASSMAN, Pepper Hamilton LLP, Philadelphia,
PA, for amicus curiae National Alliance of State Health
CO-Ops. Also represented by MARC D. MACHLIN, Wash-
ington, DC.
L AWRENCE SHER, Reed Smith LLP, Washington, DC,
for amici curiae Highmark Inc., Highmark BCBSD Inc.,
Highmark West Virginia Inc., Blue Cross and Blue Shield
of North Carolina, Blue Cross of Idaho Health Service,
Inc., Blue Cross and Blue Shield of Kansas City. Also
represented by K YLE RICHARD BAHR, C ONOR MICHAEL
SHAFFER, COLIN E. W RABLEY , Pittsburgh, PA.
D ANIEL G ORDON J ARCHO, McKenna Long & Aldridge,
LLP, Washington, DC, for amici curiae Avera Health
Plans, DAKOTACARE.
STEVEN R OSENBAUM , Covington & Burling LLP,
Washington, DC, for amicus curiae Moda Health Plans,
Inc. Also represented by CAROLINE BROWN.
L ESLIE BERGER K IERNAN, Akin, Gump, Strauss, Hauer
& Feld, LLP, Washington, DC, for amicus curiae Ameri-
cas Health Insurance Plans. Also represented by ROBERT
K. HUFFMAN; RUTHANNE M ARY D EUTSCH , HYLAND H UNT ,
Deutsch Hunt PLLC, Washington, DC.
STEPHEN A. SWEDLOW, Quinn Emanuel Urquhart &
Sullivan, LLP, Chicago, IL, for amici curiae Health Re-
public Insurance Company, Alliance of Community
Health Plans. Also represented by J. D. HORTON, A DAM
WOLFSON, Los Angeles, CA.
ANKUR G OEL , McDermott, Will & Emery LLP, Wash-
ington, DC, for amici curiae Blue Cross and Blue Shield of
South Carolina, BlueChoice HealthPlan of South Caroli-

-- 2 of 6 --

LAND OF LINCOLN MUTUAL HEALTH v. UNITED STATES 3
na, Inc. Also represented by M. MILLER BAKER , J OSHUA
D AVID R OGACZEWSKI.
T HOMAS G. HUNGAR, Office of General Counsel, Unit-
ed States House of Representatives, Washington, DC, for
amicus curiae United States House of Representatives.
Also represented by KIMBERLY HAMM , T ODD B. T ATELMAN.
______________________
Before P ROST , Chief Judge, N EWMAN and M OORE,
Circuit Judges.
Opinion for the court filed by Chief Judge P ROST .
Dissenting opinion filed by Circuit Judge N EWMAN.
P ROST , Chief Judge.
For the reasons stated in our decision in the compan-
ion case, Moda Health Plan, Inc. v. United States, No. 17-
1994, the statutory and contract claims of appellant Land
of Lincoln Mutual Health fail. Additionally, because Land
of Lincoln cannot state a contract claim, its takings claim
fails to the extent it relies on the existence of a contract.
What remains is Land of Lincoln’s takings claim to
the extent that claim arises from its statutory entitlement
to full payments. We have previously held that “no statu-
tory obligation to pay money, even where unchallenged,
can create a property interest within the meaning of the
Takings Clause.” Adams v. United States, 391 F.3d 1212,
1225 (Fed. Cir. 2004) (citing Commonwealth Edison Co. v.
United States, 271 F.3d 1327, 1340 (Fed. Cir. 2001) (en
banc)). Land of Lincoln offers no basis for departing from
that rule, and we see none. Accordingly, Land of Lincoln’s
takings claim fails.
Because we hold that the trial court correctly granted
judgment for the government as a matter of law, we need
not address whether the trial court properly reached that
conclusion via judgment on the administrative record.

-- 3 of 6 --

LAND OF LINCOLN MUTUAL HEALTH v. UNITED STATES 4
AFFIRMED
COSTS
The parties shall bear their own costs.

-- 4 of 6 --

United States Court of Appeals
for the Federal Circuit
______________________
LAND OF LINCOLN MUTUAL HEALTH
INSURANCE COMPANY, AN ILLINOIS NON-
PROFIT MUTUAL INSURANCE CORPORATION,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
______________________
2017-1224
______________________
Appeal from the United States Court of Federal
Claims in No. 1:16-cv-00744-CFL, Judge Charles F.
Lettow.
______________________
N EWMAN, Circuit Judge, dissenting.
For the reasons stated in my dissent in the concur-
rently heard case, Moda Health Plan, Inc. v. United
States, No. 17-1994, the ruling of the Court of Federal
Claims should be reversed.
The panel majority concedes that the government has
a statutory obligation to make risk corridors payments to
Land of Lincoln Mutual Health Insurance Company.
That obligation has not been altered by statute or regula-
tion. The Court of Federal Claims erred in its statutory
interpretation, and in its conclusion that the government

-- 5 of 6 --

LAND OF LINCOLN MUTUAL HEALTH v. UNITED STATES 2
need not meet the obligations by which it induced the
nation’s health insurers to implement the Affordable Care
Act. I respectfully dissent from my colleagues’ endorse-
ment of this flawed ruling.

-- 6 of 6 --