# In th e United States Court of Federal Cl aims

No. 17-877C (F iled: April 17, 2018)

************************************* COMMON GROUND HEAL THCARE * COOPERATI V E, *

* Plaintiff, * Affordable Care Act; Cost-Sharing

* Reduction Pay

ments; Motion for Class

v. * Certification; RCF C 23

* THE UNI TED STATES, *

* Defendant. *

*************************************
Stephen Swedlow, Chicag o , I L , for plaintiff.
Marc S. Sacks, United States Department of J u stice, W ashing ton, DC, for defendant.

OP INION AND ORDER

SWEENEY , J udg e
Plaintiff Common Ground Healthcare Cooperative contends, for itself and on behalf of those similarly

situated, that the federal g overnment has ceased making the cost-sharing reduction pay

ments to which it and other insurers are entitled under the Patient Protection and Affordable Care Act (“Affordable Care Act”), Pub. L . No. 111-148, 124 Stat. 119 (2010), and its implementing reg ulations. Currently before the court are plaintiff’s motions, pursuant to Rule 23 of the Rules of the United States Court of F ederal Claims (“RCF C”), to certify a class and for the appointment of class counsel. F or the reasons set forth below, the court g r ants plaintiff’s motions. 1

1 At the conclusion of its response in opposition to plaintiff’s motion to certifya costsharing reduction class, defendant requests that the court defer ruling on the motion “until there is further clarity reg arding the leg al and factual issues raised by ” plaintiff’s cost-sharing reduction claim. The court denies defendant’s request.I. BACK G ROUND

A. The Af

f ordable Care Act
Cong ress enacted the Affordable Care Act in March 2010. 124 Stat. at 119. The Act includes “a series of interlocking reforms desig ned to ex pand coverag e in the individual health insurance market.” King

v. B urwell, 135 S. Ct. 2480, 2485 (2015). I n conjunction with these reforms, the Act provided for the establishment of an American Health B enefit Ex chang e (“ex chang e”) in each state by J anuary 1, 2014, to facilitate the purchase of “qualified health plans” by individuals and small businesses. 42 U.S.C. §§ 18031, 18041 (2012); accord King , 135 S. Ct. at 2485 (describing an ex chang e as “a marketplace that allows people to compare and purchase insurance plans”). Qualified health plans can be offered at four levels (bronz e, silver, g old, and platinum) that differ based on how much of a plan’s benefits an insurer is required to cover under the plan. 2 42 U.S.C. § 18022(d)(1). An insurer that wants to offer qualified health plans on an ex chang e is required to offer at least one silver plan and one g old plan. I d. § 18021(a)(1)(C)(ii).
The reforms enacted in the Affordable Care Act provided benefits and risks for insurers. On the one hand, insurers would have access to a market of previously uninsured individuals, which could result in the insurers attracting more customers. See King , 135 S. Ct. at 2485; accord 42 U.S.C. § 18091(2)(C). On the other hand, because insurers lacked data “to predict the needs of the newly -insured” individuals, they would be hampered in their ability to “price [ qualified health] plans to reflect the medical costs associated with this new and untested marketplace.” Compl. ¶ 2. To mitig ate the risk faced by insurers, the Affordable Care Act included three premium stabiliz a tion prog rams, 42 U.S.C. §§ 18061-18063, one of which was the temporary risk corridors prog ram, id. § 18062. Under this three-y e ar prog ram, the Secretary of the Department of Health and Human Services (“Secretary of HHS”) was required to make pay ments to insurers whose costs to provide benefits ex ceeded the premiums they received (minus administrative costs), and collect pay ments from insurers whose costs to provide benefits were less than the premiums they received (minus administrative costs). I d. § 18062(a)-(b).

W h ile the risk corridors prog ram was meant to mitig a te the risks faced by insurers, two other reforms were aimed at ensuring that individuals had access to affordable insurance coverag e and healthcare: the premium tax credit prog ram enacted in section 1401 of the Affordable Care Act, 26 U.S.C. § 36B (2012), and the cost-sharing reduction prog ram enacted in section 1402 of the Affordable Care Act, 42 U.S.C. § 18071.
The premium tax credit is desig n e d to reduce the insurance premiums paid by individuals whose household income is between 100% and 400% of the poverty line. See id. § 18082(c)(2)(B )(i); 26 U.S.C. § 36B (c)(1)(A); accord 26 C.F .R. § 1.36B -2(a) to (b) (2017); 45

2 F or ex ample, for a silver-level plan, insurers are required to provide coverag e for 70% of the benefits offered under the plan. 42 U.S.C. § 18022(d)(1)(B )

.
-2-C.F

. R. § 156.460(a)(1) (2017). As set forth in the statute, the Secretary of HHS is required to determine whether individuals enrolling in qualified health plans on an ex chang e are elig ible for the premium tax credit and, if so, to notify the Secretary

of the United States Department of the Treasury (“Treasury

Secretary

”) of that fact. 42 U.S.C. § 18082(c)(1). The Treasury Secretary , in turn, is required to make periodic advance pay ments of the premium tax credit to the insurers offering the qualified health plans in which the elig ible individuals enrolled. I d. § 18082(c)(2)(A). The insurers are required to use these advance pay ments to reduce the premiums of the elig ible individuals. I d. § 18082(c)(2)(B )(i); see also 26 U.S.C. § 36B (f) (describing

the process for annually reconciling an individual’s actual premium tax credit with the advanced pay

ments of the credit).
Cost-sharing reductions are desig ned to reduce the out-of-pocket ex penses, such as deductibles, copay

ments, and coinsurance, 3 paid by individuals whose household income is between 100% and 250% of the poverty line. See 42 U.S.C. §§ 18022(c)(3), 18071(c)(2); accord 45 C.F .R. §§ 155.305(g ), 156.410(a). As set forth in the statute, insurers offering qualified health plans are required to reduce elig ible individuals’ cost-sharing oblig ations by specified amounts, 4 42 U.S.C. § 18071(a), and the Secretary of HHS and/or the Treasury Secretary is required to reimburse the insurers for the cost-sharing reductions they

made, id. §§ 18071(c)(3), 18082(c)(3). The amount of the cost-sharing reduction pay

ments owed to insurers is based on information provided to HHS by the insurers. See 45 C.F .R. § 156.430(c) (requiring insurers to report to HHS, “for each policy , the total allowed costs for essential health benefits charg ed for the policy for the benefit y

ear, broken down by

. . . (i) [ t] he amount the [ insurer] paid[ ,] (ii) [ t] he amount the enrollee(s) paid[ , and] (iii) [ t] he amount the enrollee(s) would have paid under the standard plan without cost-sharing reductions”).

I n short,“[ t] he premium tax credits and the cost-sharing reductions work tog ether: the tax credits help people obtain insurance, and the cost-sharing reductions help people g e t treatment once they have insurance.” California v. Trump, 267 F . Supp. 3d 1119, 1123 (N.D. Cal. 2017).

3 “The term ‘cost-sharing ’ includes . . . deductibles, coinsurance, copay ments, or similar charg es,” but not “premiums, balance billing amounts for non-network providers, or spending for non-covered services.” 42 U.S.C. § 18022(c)(3).

4 To be elig ible for cost-sharing reductions, an individual must enroll in a silver-level plan. 42 U.S.C. § 18071(b)(1). As noted above, under a standard silver-level plan, insurers are required to provide coverag e for 70% of the benefits offered under the plan. I d. § 18022(d)(1)(B ). However, for elig ible individuals, that percentag e increases to 73% (when household income is between 200% and 250% of the poverty line), 87% (when household income is between 150% and 200% of the poverty line), or 94% (when household income is between 100% and 150% of the poverty line). I d. § 18071(c)(2).

-3-B. Term ination of Cost-Sharing Reduction P aym ents

B e g inning in 2014, the g overnment beg an making cost-sharingreduction pay ments to insurers. However, on October 12, 2017, the g overnment terminated the pay ments based on the Attorney General’s conclusion that Cong ress had not appropriated any funds for that purpose. B e cause insurers were still required to reduce elig ible individuals’ cost-sharing o b lig ations, the lack of reimbursement had the potential to cause serious financial strain on the insurers, who mig ht then increase premiums to make up for their lost cost-sharing reduction pay ments or withdraw from the ex chang es to obviate their cost-sharing reduction oblig ations. I n deed, some insurers did, in fact, increase premiums for the qualified health plans they offered on the

ex c hang e s.

C. P rocedural History

On F e bruary

24, 2016, Health Republic Insurance Company (“Health Republic”) filed a putative class action in this court in which it alleg ed that the g overnment had not fully paid the risk corridors pay

ments to which it and other insurers were entitled for 2014 and 2015 (“the Health Republic case”). Subsequently , a number of other insurers filed similar lawsuits, and Health Republic moved to certify its case as a class action. After defendant indicated that it did not dispute that Health Republic had satisfied the requirements of RCF C 23, the court g ranted Health Republic’s motion, certified a class of insurers who were owed risk corridors pay ments for 2014 and 2015, and appointed the law firm representing Health Republic–Quinn Emanuel Urquhart & Sullivan, L L P (“Quinn Emanuel”)–as class counsel.
Plaintiff, who is represented by the same attorney

who represents Health Republic, opted into the certified class in the Health Republic case. Then, on J une 27, 2017, plaintiff filed its own putative class action in this court to recover, for itself and other insurers, unpaid risk corridors pay

ments for 2016. Several months later, on November 12, 2017, plaintiff filed an amended complaint to add a claim to recover, for itself and other insurers, the cost-sharing reduction pay

ments that the g overnment has not made since October 2017. Thereafter, several other insurers soug ht to recover unpaid cost-sharing reduction pay

ments in this court by

filing suit or, like plaintiff, adding claims to their ex isting complaints. 5

5 See L o cal I nitiative Health Auth. for L .A. Cty . v. United States, No. 17-1542C (amended complaint filed F eb. 8, 2018); Me. Cmty . Health Options v. United States, No. 17- 2057C (filed Dec. 28, 2017); Cmty . Choice Health Options v. United States, No. 18-5C (amended complaint filed F eb. 27, 2018); Sanford Health Plan v. United States, No. 18-136C (filed J an. 26, 2018); Mont. Health Co-op v. United States, No. 18-143C (filed J an. 30, 2018); Molina Healthcare of Cal. v. United States, No. 18-333C (filed Mar. 5, 2018); Health Alliance Med. Plans, I nc. v. United States, No. 18-334C (filed Mar. 5, 2018); B lue Cross & B lue Shield of Vt. v. United States, No. 18-373C (filed Mar. 9, 2018).

-4-On December 14, 2017, plaintiff moved to certify two classes–a risk corridors class and a cost-sharingreduction class–and for the appointment of Quinn Emanuel as class counsel. Defendant responded shortly thereafter, indicating

that it did not dispute that plaintiff had satisfied the requirements of RCF C 23 with respect to the risk corridors class and that it did not oppose plaintiff’s motion for the appointment of class counsel with respect to either class. After receiving defendant’s response, the court g ranted plaintiff’s motion to certify a risk corridors class, certified a class of insurers who were owed risk corridors pay ments for 2016, and appointed Quinn Emanuel as class counsel.
Defendant subsequently filed a response in opposition to plaintiff’s motion to certify a cost-sharingreduction class, and plaintiff filed a reply in support of its motion. The court deems oral arg ument unnecessary

.
II. DISCUSSION

I n its class certification motion, plaintiff seeks the certification of a cost-sharing reduction class, which it describes as follows:
All persons or entities offering Qualified Health Plans under the Patient Protection and Affordable Care Act in the 2017 or 2018 benefit y ear, and who made cost-sharingreductions for elig ible insureds pursuant to Section 1402 of the Patient Protection and Affordable Care Act, but did not receive a “timely and periodic” pay

ment from the Government of an amount “equal to the value of the reductions” provided to its insureds. Ex cluded from the Class is the Defendant and its members, ag encies, divisions, departments, and employees.

Mot. 2. A. Legal Standard

RCF C 23 g overns the certification and conduct of class actions in the United States Court of F ederal Claims (“Court of F ederal Claims”). Among other provisions, it includes several requirements for maintaining a class action:
(a) Prerequisites. One or more members of a class may sue as representative parties on behalf of all members only if:
(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are ty pical of the claims or defenses of the class; and

-5-(4) the representative parties will fairly and adequately protect the interests of the class.
(b) Class Actions Maintainable. A class action may be maintained if RCF C 23(a) is satisfied and if:
(1) [ not used] ;
(2) the United States has acted or refused to act on g rounds g enerally applicable to the class; and
(3) the court finds that the questions of law or fact common to class members predominate over any

questions affecting

only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy . The matters pertinent to these finding s include:
(A) the class members’ interests in individually controlling the prosecution of separate actions;
(B ) the ex tent and nature of any litig ation concerning the controversy already beg u n by class members;
(C) [ not used] ; and
(D) the likely

difficulties in manag ing a class action.

RCF C 23(a)-(b) (alterations in orig inal). I

n other words, a putative class representative must demonstrate: (i) numerosity –that the proposed class is so larg e that joinder is impracticable; (ii) commonality

–that there are common questions of law or fact that predominate over questions affecting individual prospective class members and that the g overnment has treated the prospective class members similarly ; (iii) ty picality –that its claims are ty

pical of the proposed class; (iv) adequacy

–that it will fairly

represent the proposed class; and (v) superiority –that a class action is the fairest and most efficient method of resolving the suit. Toscano v. United States, 98 F ed. Cl. 152, 155 (2011); B arnes v. United States, 68 F ed. Cl. 492, 494 (2005). The class action’s proponent must satisfy each of the requirements by a preponderance of the evidence. Messner v. Northshore Univ. HealthSy s., 669 F .3d 802, 811 (7th Cir. 2012) (citing Teamsters L ocal 445 F r eig ht Div. Pension F und v. B ombardier I nc., 546 F .3d 196, 202 (2d Cir. 2008)); see also W al-Mart Stores, I n c. v. Dukes, 564 U.S. 338, 350 (2011) (“Rule 23 does not set forth a mere pleading

standard. A party seeking class certification must affirmatively demonstrate his compliance with the Rule–that is, he must be prepared to prove that there are in fact sufficiently

numerous parties, common questions of law or fact, etc.”). Moreover, “[ t] hese requirements are in the conjunctive; hence, a failure to satisfy any one of them is fatal to class certification.” B arnes, 68 F e d. Cl. at 494. The court may certify a class only if, “after a rig orous

-6-analy sis,” it finds that the requirements of RCF C 23 have been met. Gen. Tel. Co. of the Sw. v.

F alcon, 457 U.S. 147, 161 (1982).
Althoug h defendant’s sole arg ument in opposition to plaintiff’s motion to certifya costsharing reduction class is that plaintiff has not met its burden of establishing that a class action is superior to other methods of resolving insurers’ claims for unpaid cost-sharing reduction pay ments, the court addresses all of the factors that plaintiff must satisfy

.
B. Num erosity
To prevail on its motion to certify a cost-sharing

reduction class, plaintiff must first satisfy the numerosity requirement. RCF C 23(a)(1) specifies that a class action is appropriate only if “the class is so numerous that joinder of all members is impracticable[ .] ” “‘I mpracticable does not mean impossible.’” J ay nes v. United States, 69 F ed. Cl. 450, 454 (2006) (quoting Robidoux v. Celani, 987 F .2d 931, 935 (2d Cir. 1993)); see also F auverg ue v. United States, 86 F ed. Cl. 82, 96 (2009) (“The ability to use joinder does not preclude certification.”), rev’d on other g rounds sub nom. B r ig ht v. United States, 603 F

. 3d 1273 (F ed. Cir. 2010). Rather, a putative class representative need only establish that “‘it is ex tremely difficult or inconvenient to join all the members of the class.’” J ay nes, 69 F ed. Cl. at 454 (quoting 7A Charles Alan W rig ht et al., F ederal Practice and Procedure § 1762 (3d ed. 2005) (“W rig ht 2005”)). A court must

ex a mine the facts of the case to determine whether the numerosity requirement has been satisfied. Gen. Tel. Co. of the Nw., I nc. v. EEOC, 446 U.S. 318, 330 (1980). I n particular, a court should consider the number of potential class members, the g eog raphic dispersal of the potential class members, and the siz e of each potential class member’s claim. King v. United States, 84 F ed. Cl. 120, 123-24 (2008); accord J ay nes, 69 F ed. Cl. at 454; 5 J ames W m. Moore et al., Moore’s F e deral Practice ¶ 23.22[ 1] [b] (3d ed. 2012); 7A Charles Alan W r ig ht et al., F ederal Practice and Procedure § 1762 (3d ed. 2016).
The number of potential class members is considered to be the most important factor of the numerosity

requirement. King , 84 F ed. Cl. at 124; F auverg ue, 86 F ed. Cl. at 96. Plaintiff represents, based on the number of insurers offering qualified health plans on the ex chang es, that hundreds of such insurers are owed cost-sharing reduction pay

ments. This fact, standing alone, is sufficient to satisfy

the numerosity

requirement. See, e.g

. , B rown v. United States, 126 F ed. Cl. 571, 578 n.3 (2016) (indicating that the Court of F ederal Claims has found potential class siz es of 23, 25, 135, 150, and 152 members sufficient to satisfy the numerosity

requirement). I ndeed, in the risk corridors contex t, the court certified a class in the Health Republic case that ultimately

included 149 members, and certified a class in this case with the knowledg e that there were approx imately

280 potential class members. Moreover, plaintiff observes that potential class members are dispersed throug hout the country

–a fact that supports the conclusion that

-7-plaintiff has satisfied the numerosity requirement. 6 See, e.g ., King , 84 F ed. Cl. at 124-25 (“I f plaintiffs are dispersed g e o g r aphically , then a court is more likely to certify a class action.”).

C. Com m onality

The nex t requirement, commonality , comprises three separate inquiries. F irst, are there factual or leg al issues common to the proposed class? RCF C 23(a)(2). Second, do these common issues predominate over issues that are not common to the proposed class? RCF C 23(b)(3). And third, has the g overnment acted or refused to act on g rounds applicable to the entire proposed class? RCF C 23(b)(2). I n analy z ing whether the commonality r e quirement has been satisfied, “the court must, where necessary , look bey ond the pleading s, and seek to develop an understanding

of the relevant claims, defenses, facts and substantive law.” B arnes, 68 F ed. Cl. at 494; accord W al-Mart Stores, I nc., 564 U.S. at 350-52. As discussed below, plaintiff has established all three elements of the commonality requirement.

1. Com m on Issues

F irst, to establish the ex istence of a common factual or leg al issue, plaintiff must demonstrate that the claims of the potential class members “depend upon a common contention” that “is capable of classwide resolution[ .] ” W a l-Mart Stores, I nc., 564 U.S. at 350; see also King , 84 F ed. Cl. at 126 (ag reeing that “‘commonality

is satisfied where the lawsuit challeng es a sy stem-wide practice or policy that affects all of the putative class members’” (quoting Armstrong v. Davis, 275 F .3d 849, 868 (9th Cir. 2001))); B arnes, 68 F ed. Cl. at 496 (“[ T ] he questions underly ing the claims of the class merely must share essential characteristics, so that their resolution will advance the overall case.”). A common contention can be resolved for the entire class if the “determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” W al-Mart Stores, I nc., 564 U.S. at 350; accord id. (“‘W hat matters to class certification . . . is not the raising of common “questions”–even in droves–but, rather the capacity of a classwide proceeding to g enerate common answers apt to drive the resolution of the litig ation. Dissimilarities within the proposed class are what have the potential to impede the g eneration of common answers.’” (quoting Richard A. Nag areda, Class Certification in the Ag e of Ag g reg ate Proof, 84 N.Y.U. L . Rev. 97, 131-32 (2009))); Ty son F oods, I nc. v. B ouaphakeo, 136 S. Ct. 1036, 1045 (2016) (“[ A] common question is one where ‘the same evidence will suffice for each member to make a prima facie showing [ or] the issue is susceptible to g eneraliz ed, class-wide proof.’” (quoting 2 W illiam B . Rubenstein, Newberg on Class Actions § 4:50, at 196-97 (5th ed. 2012)). Only one sig nificant common contention capable of classwide resolution is necessary to satisfy the common-issue requirement. See B a rnes, 68 F ed. Cl. at 496 n.6.

6 Plaintiff also contends that some of the potential cost-sharing reduction claims are small enoug h that insurers mig ht not pursue them in the absence of a class action, but does not supply any

evidence supporting

this contention.

-8-Plaintiff identifies five issues that are common to all potential members of the proposed

cost-sharingreduction class, including whether the pertinent statute and reg ulation mandate the pay ment of money , whether the g overnment’s failure to make periodic cost-sharing reduction pay ments violates the pertinen t statute and reg ulation, and whether the g overnment is liable to the potential class members for its failure to make the pay ments. 7 These issues are, in fact, common to all potential class members. Thus, plaintiff has satisfied the common-issue requirement.

2. P redom inance

I n addition to determining whether plaintiff has established the ex istence of common factual or leg al issues, the court must determine whether those issues predominate over issues that are not common to the proposed class. This predominance inquiry “tests whether proposed classes are sufficiently

cohesive to warrant adjudication by representation” and “is far more demanding ” than the initial common-issue inquiry . Amchem Prods., I nc. v. W indsor, 521 U.S. 591, 623-24 (1997); accord Comcast Corp. v. B ehrend, 569 U.S. 27, 34 (2013). Common issues–those in which the same evidence could be used by each member of the class to make a prima facie showing

– predominate over individual issues–those in which each member of the class must present individualiz ed evidence to make a prima facie showing –if they “‘are more substantial than the issues subject only to individualiz ed proof.’” J a y nes, 69 F ed. Cl. at 457 (quoting Moore v. Pay

n eW e bber, Inc., 306 F .3d 1247, 1252 (2d Cir. 2002)); accord Ty son F oods, I nc., 136 S. Ct. at 1045; Geneva Rock Prods., I nc. v. United States, 100 F ed. Cl. 778, 789 (2011).
As plaintiff observes, all potential members of the proposed cost-sharing reduction class
are subject to the same statutory and reg ulatory reg ime under the [ cost-sharing reduction] provision of the [ A ffordable Care Act] –the same requirements to be [ qualified health plan] issuers, the same oblig ations to provide [ Affordable Care Act] -compliant plans, the same reporting requirements, and the same requirements to provide cost-sharing reduction to insureds while being denied [ cost-sharing reduction] reimbursements by the Government.
Mot. 23. The only

issue that is not common to the proposed class is the precise amount of money alleg edly due to each potential class member under the pertinent statutes and reg ulations.

7 Another common issue not mentioned by plaintiff, but implicated in defendant’s response in opposition to plaintiff’s motion, is whether the g overnment’s liability for its failure to make cost-sharing

reduction pay

ments is mitig a ted by

the increased premium tax credits it paid to insurers after it ceased making cost-sharingreduction pay ments. This issue is discussed in more detail below. See infra Sections I I

. C.2, I I .F

.
-9-I n its response in opposition to plaintiff’s motion, defendant sug g ests–as part of its

arg ument concerning

the superiority

factor–that the need to calculate damag es for each potential class member overwhelms the common issues, rendering class certification inappropriate. Specifically , it arg ues:
[ Plaintiff’s cost-sharingreduction claims] may present individualiz ed questions . . . , because many

insurers will not have been injured because their [ cost-sharing reduction] liabilities will have been offset by premiums that were raised in connection with the cessation of [ cost-sharingreduction] pay ments, resulting in increased premium tax credit pay ments from the g overnment. The class action mechanism would make adjudicating these individualiz ed questions impracticable.
Resp. 12 (citation omitted). However, as plaintiff remarks, defendant does not identify any statutory provision permitting the g overnment to use premium tax credit pay ments to offset its cost-sharingreduction pay ment oblig ations (even if insurers intentionally increased premiums to obtain larg er premium tax credit pay ments to make up for lost cost-sharing reduction pay

ments). 8 I n the absence of such an offset, the calculation of each potential class member’s unpaid costsharing reduction pay

ments appears to be a rather straig htforward process based on data provided to the g overnment by

the insurers–the identity

of each qualified health plan in which individuals elig ible for cost-sharing reductions are enrolled, and the amount of each individual’s cost-sharing reduction. Such a calculation lacks the complex ity that would overwhelm the issues common to the proposed class. F urthermore, it is well settled that the need for individualiz e d damag es calculations does not preclude the certification of a class. See, e.g ., Geneva Rock Prods., I nc., 100 F ed. Cl. at 789 (“The central leg al questions of this case . . . can all be resolved throug h g eneraliz ed proof. Even thoug h the question of just compensation will require ‘individualiz ed proof’ if the g overnment is found liable, this court has repeatedly held that the overall question of liability is ‘more substantial’ than the individualiz ed calculation of damag es.”); Hag g a rt v. United States, 89 F ed. Cl. 523, 533-34 (2009) (“The primary factual difference among potential class members concerns the damag es each individual class member would be entitled to receive if the court found the g overnment’s actions constituted a taking of plaintiffs’ property

. . . . However, . . . differences in the amount of potential damag e s among putative class members will not alone prevent class certification.”); F auverg ue, 86 F ed. Cl. at 100 (“The predominate question applicable to all putative plaintiffs is whether the Government committed a taking

. . . .

8 Rather, defendant sug g ests that the October 2017 decision of the United States District Court for the Northern District of California (“district court”) in California v. Trump supports the availability

of such an offset. See Resp. 10 (“As [ the district court] noted, many insurers have been able to recoup [ cost-sharingreduction] pay ments for 2018 by

raising premiums to account for the non-pay

ment of [ cost-sharingreductions] and those hig her premium costs are then paid for by the Government throug h increased premium tax credits.”); accord id. at 12. As the court

ex p lains below in its discussion of the superiority factor, defendant’s reliance on this decision is misplaced. See infra Section I I .F

.

- 10-That plaintiffs may receive different awards of damag es based on the nature of the taking s claim does not displace the principal leg al question or the core facts of this case.”); Curry v. United States, 81 F ed. Cl. 328, 334 (2008) (“The ‘[ m] ere fact that damag e awards will ultimately require individualiz ed fact determinations is insufficient, by itself’ to defeat a class action.” (quoting McCarthy

v. Kleindienst, 741 F .2d 1406, 1415 (D.C. Cir. 1984))). I n sum, plaintiff has established that the common issues presented in this case predominate over the sole individualiz ed issue.

3. Sim ilar Treatm ent
The final aspect of the commonality requirement is determining whether the g overnment has “acted or refused to act on g rounds g enerally

applicable to the class.” RCF C 23(b)(2). Plaintiff contends that the g overnment’s failure to make cost-sharing reduction pay

ments to insurers satisfies this requirement. There can be no dispute that this failure to act is g enerally applicable to the class. Thus, plaintiff has established this aspect of the commonality requirement.
D. Typicality
The third g eneral requirement for maintaining a class action is that the claims of the proposed class representative(s) be ty pical of the claims of the other prospective class members. See RCF C 23(a)(3). I

n many way s, the ty

picality requirement is similar to the commonality requirement: “B oth serve as g u ideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff’s claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately

protected in their absence.” Gen. Tel. Co. of the Sw., 457 U.S. at 157 n.13. Nevertheless, ty

p icality and commonality

are distinct requirements. Ty picality is demonstrated “when ‘each class member’s claim arises from the same course of events, and each class member makes similar leg al arg

uments to prove the defendant’s liability

. ’” B arnes, 68 F ed. Cl. at 498 (quoting I n re Drex el B urnham L ambert Grp., I nc., 960 F .2d 285, 291 (2d Cir. 1992)). I t “may be satisfied even if some factual differences ex ist between the claims of the named representatives and the claims of the class, provided that the named representatives’ claims share the same essential characteristics as the claims of the class at larg e.” F isher v. United States, 69 F ed. Cl. 193, 200 (2006) (citing Piaz z a v. EB SCO I ndus., I n c ., 273 F .3d 1341, 1351 (11th Cir. 2001)). According ly , “[ t] he threshold requirement for ty picality is . . . not hig h.” I d.
Plaintiff arg ues that it satisfies the ty picality requirement because, in its role as the representative party , it is alleg ing the same g overnment conduct, stating the same claim, and seeking the same relief as all potential members of the proposed cost-sharing reduction class. The court agr ees.

- 11-E. Adequacy

I n addition to establishing numerosity , commonality , and ty picality , a putative class representative must establish that it will “fairly and adequately

protect the interests of the class.” RCF C 23(a)(4). There are two aspects to the adequacy

requirement: the ex istence of conflicts between the putative class representative and the members of the proposed class, and the qualifications and capabilities of proposed class counsel. Amchem Prods., I nc., 521 U.S. at 625- 26 & n.20; Gen. Tel. Co. of the Sw., 457 U.S. at 157 n.13.

1. Conf licts of Interest
The first component of the adequacy requirement concerns whether there are any conflicts of interest precluding

a plaintiff from serving as a class representative. See Gen. Tel. Co. of the Nw., I nc., 446 U.S. at 331. Plaintiff contends that “[ t] h ere are no ‘conflicting , competing , or antag onistic interests as between [ it] and the proposed class’ that would warrant a finding that [ it] would not adequately

protect the class’s interest.” Mot. 26-27 (quoting Sing leton v. United States, 92 F ed. Cl. 78, 86 (2010)). I ndeed, the court cannot discern any conflicts of interest, especially g iven the almost universal commonality of the issues requiring the court’s resolution. Thus, plaintiff has established this component of the adequacy requirement.

2. P roposed Class Counsel
The second component of the adequacy requirement concerns the ex perience and competence of proposed class counsel. B efore the court can appoint class counsel, it “must consider”:
(i) the work counsel has done in identify ing or investig ating potential claims in the action;
(ii) counsel’s ex p erience in handling class actions, other complex litig ation, and the ty pes of claims asserted in the action;
(iii) counsel’s knowledg e of the applicable law; and
(iv) the resources that counsel will commit to representing the class[ .]

RCF C 23(g )(1)(A). I

n addition, it “may

consider any

other matter pertinent to counsel’s ability to fairly and adequately

represent the interests of the class[ .] ” RCF C 23(g )(1)(B ). Ultimately , the court must satisfy

itself that the proposed class counsel would best serve the interests of the proposed class. RCF C 23(g )(2).
Plaintiff seeks the appointment of Quinn Emanuel as counsel for the cost-sharing reduction class. The court finds that Quinn Emanuel has the ex perience and resources necessary

- 12-to handle class actions, as reflected by its prior decision to appoint Quinn Emanuel as class counsel for the two risk corridors classes. F urther, as reflected by plaintiff’s amended complaint and motion for class certification, Quinn Emanuel has performed the work necessary to identify and investig ate the potential cost-sharing reduction claims, and is well versed in the law reg arding such claims. According ly , the court finds that plaintiff has satisfied the second component of the adequacy requirement.

F . Superiority
The final requirement that plaintiff must satisfy to maintain a class action is superiority ; in other words, a class action must be “superior to other available methods for fairly and efficiently adjudicating the controversy .” 9 RCF C 23(b)(3). This requirement is met if the prospective class representative establishes that “a class action would achieve economies of time, effort, and expense, and promote uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bring ing about other undesirable results.” F ed. R. Civ. P. 23 advisory committee’s note to 1966 amendment, quoted in Amchem Prods., I nc., 521 U.S. at 615. Among the factors to consider in determining superiority

are (1) the potential “class members’ interests in individually

controlling the prosecution of separate actions,” (2) “the ex tent and nature of any

litig ation concerning

the controversy

already beg un by

class members,” and (3) “the likely

difficulties in manag ing a class action.” RCF C 23(b)(3). “Essentially , under this prong of the analy sis, the court is oblig ed to conduct a cost/benefit analy sis, weig hing any potential problems with the manag eability or fairness of a class action ag ainst the benefits to the sy stem and the individual members likely to be derived from maintaining such an action.” B a rnes, 68 F ed. Cl. at 499; see also J ay nes, 69 F ed. Cl. at 459 (“I n making [ the superiority ] assessment, the court must consider what alternative procedures are available for disposing of the dispute and compare the possible alternatives to determine whether Rule 23 will be sufficiently effective to justify

the class action approach. The superiority requirement is most clearly satisfied ‘if a comparative evaluation of other procedures reveals no other realistic possibilities.’” (citation omitted) (quoting 7AA W rig ht 2005, supra, § 1779)).
Plaintiff asserts that a class action is “superior to joinder or individual adjudication of” cost-sharingreduction claims, ex plaining that “[ a] sing le Government action affected” each potential member of the proposed cost-sharing reduction class “in ex actly the same way ,” and that the g overnment can identify each potential class member and possesses, or will soon possess, “the data showing how much it owes each” potential class member. Mot. 27-28. Consequently , plaintiff argues, resolution of the leg a l issues presented in this case on a classwide basis would achieve economies of time, effort, and ex pense. Plaintiff further contends that it has

9 There are several other methods of adjudicating the claims of multiple individuals arising from the same course of conduct: the permissive joinder of parties under RCF C 20, the filing of a related case under RCF C 40.2, and consolidation under RCF C 42(a). Procedurally , RCF C 20 requires a motion to amend the complaint to join new plaintiffs, while RCF C 40.2 and RCF C 42(a) require the filing of separate complaints.

- 13-satisfied the factors described in RCF C 23(b)(3) because (1) “[ t] here is nothing to indicate that a

Class member would benefit from individually controlling an action, and because the Court of F ederal Claims permits only opt-in classes, there is no concern that a class member mig ht be swallowed into a class that it would prefer not to participate in,” and (2) “there are no ‘likely difficulties,’ in manag ing the class.” I d. at 28 (citations omitted).

I n response, defendant arg ues that plaintiff has not met its burden of establishing that a class action would be the superior method of resolving insurers’ cost-sharing

reduction claims. I n particular, defendant contends that plaintiff has not demonstrated that the consolidation of separate suits pursuant to RCF C 42 “is a less effective mechanism for considering ” the claims. 1 0 Resp. 10. Defendant avers that “Rule 42’s consolidation procedures are superior to a class action because those procedures will allow the Court to consider the common issues shared by the plaintiffs, while also allowing the Court to assess whether the cessation of [ c ost-sharing reduction] pay

ments operated to an individual plaintiff’s detrimen t in a particular case.” I d. According to defendant, there will be sig nificant individualiz ed determinations in resolving insurers’ cost-sharing

reduction claims “because many insurers will not have been injured because their [ cost-sharingreduction] liabilities will have been offset by premiums that were raised in connection with the cessation of [ cost-sharingreduction] pay ments, resulting in increased premium tax credit pay ments from the g overnment.” I d. at 12.

1 0 RCF C 42 provides:
(a) Consolidation. I f

actions before the court involve a common question of law or fact, the court may :
(1) join for hearing

or trial any

or all matters at issue in the actions;
(2) consolidate the actions; or
(3) issue any

other orders to avoid unnecessary cost or delay

. (b) Separate Trials. F or convenience, to avoid prejudice, or to ex p edite and economiz e, the court may order a separate trial of one or more separate issues, claims, counterclaims, or third-party claims.
(c) Separate Determinations of L iability and Damag es.
(1) I n General. On stipulation of the parties or on its own, the court may at any time order that issues of liability and issues of damag e s be addressed in separate proceeding s.
(2) Motion for Reconsideration. The parties may file a motion for reconsideration within 14 day s after a separate determination of liability

.

- 14-As noted above, defendant does not identify any statutory provision permitting the g overnment to use premium tax credit pay ments to offset its cost-sharing reduction pay ment oblig ations (even if insurers intentionally increased premiums to obtain larg er premium tax credit pay ments to make up for lost cost-sharingreduction pay ments). Rather, defendant sug g ests that the district court’s decision in California v. Trump supports the availability of such an offset. Defendant’s reliance on that decision for this proposition is misplaced. Althoug h the district court described how insurers are coping with the lost cost-sharing reduction pay ments by raising premiums to obtain larg e r premium tax credit pay ments, nowhere in its decision does the district court hold that the g overnment’s liability for cost-sharing

reduction pay

ments is lessened or eliminated by

the g o vernment making larg er premium tax credit pay ments to insurers. I ndeed, the district court very

clearly emphasiz ed that the premium tax credit prog ram and cost-sharing reduction prog r am were separate and distinct:
Repeatedly referring

to the two prog rams by

their separate names sug g ests Cong ress considered them distinct, if undoubtedly related. And the statute often recites not just the names of these two prog r ams, but the different statutory provisions that created them. F or instance, in the advance pay ment provision, . . . the statute refers to “the premium tax credit allowable under section 36B of Title 26 and the cost-sharing

reductions under section 18071 of this title.” 42 U.S.C. § 18082(a)(1); see also, e.g ., id. § 300g g -4(l)(3)(A)(ii) (“credits under section 36B of Title 26 or cost-sharing assistance under section 18071 of this title”); id. § 18031(i)(3)(B ) (“premium tax credits under section 36B of Title 26 and cost-sharingreductions under section 18071 of this title”). That Cong ress so often identified each reform by its location in one title of the U.S. Code or the other sug g ests that Cong r ess was cog niz a nt of the different way

in which each reform fit into the statutory

scheme.

California, 267 F . Supp. 3d at 1131. Moreover, the portion of the decision upon which defendant relies–pag es 1133 to 1139–contains the district court’s analy sis of “whether the absence of a preliminary

injunction would harm the public and impede the objectives of health care reform.” I d. at 1133. I n other words, the district court’s focus was on how the increase in premiums would affect the public, and not on the g overnment’s oblig ation to make pay ments to insurers.
The court recog

niz e s that the parties have not had the opportunity to fully brief the issue of whether the g overnment’s oblig ation to make cost-sharing reduction pay

ments is mitig ated by its increased premium tax credit pay ments–an issue that is common to all potential class members. However, g iven the lack of cited authority supporting the availability of such an offset, the determination of the amount due to each potential class member appears to consist of a straig htforward calculation based on data that the g o vernment has obtained, or will be obtaining , from the affected insurers. Thus, for the purposes of resolving the present motion, the court must assume that the individual damag es determinations will be uncomplicated.

- 15-As plaintiff observes in its reply in support of its motion, defendant does not arg ue that insurers “have strong

interests in litig ating their own separate actions” or that “numerous individual class members have filed their own lawsuits reg arding [ cost-sharingreduction] pay ments.” Reply

5. I nstead, defendant addresses the manag eability of the proposed class action, arg

u ing that the need for individualiz ed damag es determinations makes consolidation more appropriate than a class action. Plaintiff convincing ly rebuts this arg ument.

F irst, plaintiff reiterates the position it advanced in its motion that resolution of the leg al issues presented in this case on a classwide basis would achieve economies of time, effort, and

ex p ense because each insurer was affected by the same g overnment action in the same way . The court ag rees. A class action would allow insurers to pursue their cost-sharing reduction claims without the need to file separate complaints–an efficient and cost-effective approach. F urther, a class action would relieve both defendant and the court of the burdens associated with manag ing potentially

hundreds of new cases with virtually identical alleg ations.
Second, plaintiff rig htly

observes that consolidation would not be more efficient than a class action, ex p laining :

I n essence, the Government arg ues that [ qualified health plan] issuers should be forced to hire separate lawy ers, spend time and money drafting their own complaints, pay

filing and other related fees, g enerate a new index number with each case, and then either file a motion to consolidate their individual action with this case or force the Government to file its own motion requesting that relief. All of this, according

to the Government, will be more efficient, fair, and thus “superior” to a class action in which putative class members simply fill in a form to opt into a class with counsel who has been at the forefront of this litig ation for over two y ears.

I d. at 6-7. There can be no question that the consolidation of cost-sharing reduction claims would be more cumbersome than allowing insurers to pursue their claims in a class action.

I n sum, the court finds that plaintiff has satisfied its burden of establishing that a class action is superior to other methods of resolving insurers’ cost-sharing

reduction claims.

III. CONCLUSION

B e cause plaintiff has satisfied all of the requirements set forth in RCF C 23 for maintaining a class action, the court G RANTS plaintiff’s motion to certify a cost-sharing reduction class. Specifically :

- 16-1. The court certifies the following cost-sharing reduction class:
All persons or entities offering Qualified Health Plans under the Patient Protection and Affordable Care Act in the 2017 or 2018 benefit y ear, and who made cost-sharingreductions for elig ible insureds pursuant to Section 1402 of the Patient Protection and Affordable Care Act, but did not receive a “timely and periodic” pay

ment from the Government of an amount “equal to the value of the reductions” provided to its insureds. Ex cluded from the Class is the Defendant and its members, ag encies, divisions, departments, and employees.
2. The cost-sharing

reduction class claim is for amounts alleg edly owed to the class by the United States pursuant to section 1402 of the Affordable Care Act (42 U.S.C. § 18071) and 45 C.F .R. § 156.430 for the 2017 and 2018 benefit y ears.
3. The parties may later move for decertification or move for the class to be divided into subclasses if, as this case develops, the circumstances warrant such a motion.
4. Plaintiff is desig nated as the class representative.

5. The court G RANTS the unresolved portion of plaintiff’s motion for the appointment of class counsel a

nd appoints Quinn Emanuel as counsel for the cost-sharing reduction class. 1 1

6. Defendant, by no later than F riday, May 18, 2018 , shall provide to plaintiff a list of potential class members, which shall include all entities that offered qualified health plans under the Affordable Care Act in the 2017 and 2018 benefit y ears, and who made cost-sharing reductions for elig ible insureds pursuant to section 1402 of the Affordable Care Act, but did not receive a “timely and periodic” pay ment from the g overnment of an amount “equal to the value of the reductions” provided to its insureds. The list shall include the name of the individual or entity that is a potential class member, the current or last known electronic-mail address of the individual or entity

(providing the name and electronic-mail address of the person responsible for cost-sharingreduction receivables, if known), and the current or last known mailing address of the individual or entity

.
7. I f, after May

18, 2018, plaintiff discovers the identity of additional potential class members to whom plaintiff believes that notice should be provided, plaintiff shall promptly inform defendant. Defendant shall have an opportunity to object to any additional potential class members w ithin seven calendar days from the date that plaintiff identifies the newly discovered potential class members by forwarding

its objections to plaintiff via electronic mail. I f the parties

1 1 Notwithstanding the appointment of Quinn Emanuel as class counsel, all filing s made on behalf of the class shall continue to be sig ned by the attorney of record for the class representative. See RCF C 83.1(c)(1)-(2) (“A party may have only

one attorney

of record in a case at any

one time . . . . All filing s must be sig ned in the attorney of record’s name.”).

- 17-are unable to resolve any of defendant’s objections to the newly discovered potential class members, they

shall file a joint motion setting out in separate sections their respective positions for resolution by

the court.
8. Class counsel shall submit to the court a proposed notice plan and opt-in schedule that complies with the requirements of RCF C 23(c)(2)(B ) by no later than Wednesday, May 30, 2018

.
IT IS SO ORDERED.
s/ Marg aret M. Sweeney MARGARET M. SW EENEY J udg e

- 18-