OCR Proposes Changes to the Civil Rights Enforcement Section of the Affordable Care Act Section 1557

The Department of Health and Human Services (“HHS”) and the Office of the Civil Rights (“OCR”) recently proposed changes to Section 1557 of the Affordable Care Act (“Act”). This Section of the Act prohibits civil rights discrimination in certain health programs or activities. Some of the major changes, include, among others, revising the regulatory definition of what constitutes discrimination on the “basis of sex”. The proposal also includes healthcare conscience protections. Additionally, the proposed rule would eliminate taglines and notices requirement and it would revise the language access and grievance procedures of the rule.

Eliminating Gender Identity and Termination of Pregnancy from Definition of Discrimination Based on the “Basis of Sex”

Section 1557 is the civil rights provision in the ACA that prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities. When ACA was passed, Congress prohibited discrimination under Section 1557 by referencing four existing federal civil rights laws: Title VI of the Civil Rights Act of 1964 (prohibiting discrimination on the basis of race, color, and national origin); Title IX of the Education Amendments of 1972 (prohibiting discrimination on the basis of sex in education programs or activities that recieve Federal funding); Section 504 of the Rehabilitation Act of 1973 (prohibiting discrimination on the basis of disability); and Age Discrimination Act of 1975 (prohibiting discrimination on the basis of age).

Section 1557 has been in effect since its enactment in 2010, and Congress directed OCR to enforce these provision, which HHS aimed to do by passing the 2016 Section 1557 regulation (“2016 Rule”). Since the promulgation of the 2016 Rule the agency has been sued several times over the scope of the rule and it is now proposing amendments to narrow the regulatory language.

The 2016 Rule defined discrimination “on the basis of sex” to include termination of pregnancy, sex stereotyping and gender identity. The 2016 Rule defined “gender identity” as one’s “internal sense of being male, female, neither, or a combination of male and female,” and that this identification may differ from one’s “sex assigned at birth” The 2016 Rule defined “sex stereotypes” as stereotypical notions of masculinity or femininity, including expectations of how individuals represent or communicate their gender to others, such as behavior, clothing, hairstyles, activities, voice, mannerisms, or body characteristics. These stereotypes can include the expectation that individuals will consistently identify with only one gender and that they will act in conformity with the gender-related expressions stereotypically associated with that gender. Sex stereotypes also include gendered expectations related to the appropriate roles of a certain sex. 45 C.F.R. 92.4.

The OCR is now proposing to exclude from the definition of discrimination “on the basis of sex” discrimination based on gender identity, sex stereotyping and termination of pregnancy. Among other things, the agency cited several court decisions as well as Attorney General’s October 4, 2017 Memorandum (“Memorandum”) as the basis for its decision to revise the definition of discrimination “on the basis of sex.” Specifically, since the issuance of the Memorandum, the Department of Justice, which represents HHS in court, began submitting briefs in lawsuits arguing that ACA Section 1557 does not protect individuals on the basis of “gender identity.” That memorandum stated, among other things, that “‘sex’ is ordinarily defined to mean biologically male or female” and that “Title VII’s prohibition on sex discrimination encompasses discrimination between men and women but does not encompass discrimination based on gender identity per se, including transgender status. Therefore, as of the date of this memorandum … the Department of Justice will take that position in all pending and future matters….”

The rule also proposes to incorporate language for religious and abortion exemptions in the provision of healthcare services.

Additionally, the proposed rule would eliminate the requirement for each covered entity with 15 or more employees to have a compliance coordinator and a written grievance procedure to handle complaints alleging violations of Section 1557.

Revisions to Tagline and Language Assistance Provisions
Citing President Trump’s Executive Orders directing executive agencies to reduce regulatory burden and costs, HHS re-evaluated the impact that tagline mailings imposed on covered entities. Under the 2016 Rule the tagline requirement imposed an obligation on covered entities to provide to beneficiaries, enrollees, and others, “taglines” describing the availability of free language assistance services in “at least the top 15 languages” spoken by individuals with limited English proficiency (LEPs) in the relevant State or States.

The OCR proposed to repeal the Section 1557 provisions on taglines, the use of language access plans, and notices of non-discrimination. The OCR also proposed to replace the requirements for remote English- language video interpreting services with comparably effective requirements with respect to audio-based service. The OCR proposes to return to the language access standard previously in place under the existing Title VI regulation as interpreted by the U.S. Supreme Court and HHS and the Department of Justice in their LEP guidance documents.

The proposed rule also rewrote its current section “Meaningful Access for Individuals with Limited English proficiency” (renumbered as 92.101 under the proposed rule from 92.201 under Rule 2016). Among other changes suggested, the OCR’s enforcement discretion against covered entities will be based on how an entity balances four factors: (i) the number or proportion of limited English proficient individuals eligible to be served or likely to be encountered in the eligible service population; (ii) the frequency with which LEP individuals come in contact with the entity’s health program, activity, or service; (iii) the nature and importance of the entity’s health program, activity, or service; and, (iv) the resources available to the entity and costs. This is a change from the requirements of the 2016 Rule, where the Director would evaluate a covered entity’s compliance of more stringent factors.

Additional Changes
HHS announced that upon publication of the notice of proposed rulemaking, it will, as a matter of enforcement discretion, suspend all previously issued subregulatory guidance issued that interprets or implements Section 1557 (including FAQs, letters, and the preamble to the 2016 Rule) in ways that are inconsistent with any provision in the proposed rule (including the preamble) or with the requirements of the underlying civil rights statutes cross-referenced by Section 1557 or their implementing regulations.

HHS also announced that as of publishing of the proposed rule HHS would no longer assert, as it has done in the 2016 Rule, that a private right of action exists for parties to sue covered entities for any and all alleged violations of the proposed rule. This would revoke 45 C.F.R. 92.302(d) which gave an individual or entity a right to bring a civil action to challenge a violation of Section 1557 in a United States District Court in which the recipient or State-based Marketplace is found or transacts business. This means that HHS is leaving the matter for the courts to decide.

HHS is also proposing that the effective date be 60 days after publication of the Final Rule. Comments on the proposed Rule are due on or before August 13, 2019.

If you have questions regarding the 2016 Rule, the proposed rule, Section 1557 of the Act, other aspects of the Medicare or Medicaid program, exclusion, revocation, enrollment denial, enrollment, audits, or have other health law related concerns, please contact our office.