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Ed Murphy Jonathon Trionfi Scott McLellan
September 22, 2016 Article 6 min read
Part of the Affordable Care Act, the new rule generally goes into effect in July 2016. This bulletin details key guidelines and provisions.

Overview

On May 13, 2016, the Department of Health and Human Services (HHS) issued a final rule implementing Section 1557 of the Affordable Care Act (ACA) regarding nondiscrimination in federally funded health programs. The final rule:

  • Prohibits discrimination in healthcare on the basis of race, color, national origin, age, disability and sex (including discrimination based on pregnancy, gender identity, and sex stereotyping)
  • Enhances language assistance for people with limited English proficiency
  • Helps to ensure effective communication for individuals with disabilities

These nondiscrimination protections apply to all health programs and activities that receive federal funding from HHS or that are administered by HHS, including both federally facilitated and state-based Exchanges.

The final rule prohibits discrimination in the provision of health insurance by health insurers that participate in the Exchanges or otherwise receive federal funding from HHS.

The final rule implements Section 1557 of the ACA, which is the first federal civil rights law to broadly prohibit discrimination on the basis of sex in federally funded health programs. Previously, civil rights laws enforced by HHS's Office for Civil Rights (OCR) broadly barred discrimination based only on race, color, national origin, disability or age.

The Section 1557 final rule applies to:

  • Any health program or activity that receives funding from HHS (such as hospitals that accept Medicare or doctors who receive Medicaid payments)
  • State-based and federally facilitated Exchanges and issuers that participate in those Exchanges
  • Any health program that HHS itself administers

Specifically, the final rule prohibits sex discrimination in healthcare, enhances language assistance for people with limited English proficiency, includes important protections for individuals with disabilities and prohibits marketing practices or benefit designs that discriminate on the basis of race, color, national origin, sex, age or disability.

Protections for exchange coverage and other federally funded health plans

The final rule prohibits discrimination in the provision of health insurance and related coverage by health insurers that participate in the Exchanges or otherwise receive federal funding from HHS. Under this rule, the following actions are prohibited on the basis of race, color, national origin, sex, age or disability.

Specifically, covered entities may not, on a discriminatory basis:

  • Deny, cancel, limit or refuse to issue or renew a health-related insurance plan or coverage
  • Deny or limit a claim or impose additional cost-sharing or other limitations or restrictions on coverage
  • Engage in discriminatory marketing practices or adopt or implement discriminatory benefit designs in health-related insurance or other health-related coverage
  • Deny or limit coverage or a claim, or impose additional cost-sharing or other limitations or restrictions on coverage, for sex-specific health services provided to transgender individuals just because the individual seeking such services identifies as belonging to another gender
  • Categorically exclude coverage for all health services related to gender transition, or deny or limit (or impose additional cost-sharing or other limitations or restrictions on) coverage for specific health services related to gender transition if those result in discrimination against a transgender individual

Protections against sex discrimination

The final rule’s prohibition against sex discrimination in healthcare includes discrimination based on:

  • An individual’s sex
  • Pregnancy, childbirth, and related medical conditions
  • Gender identity
  • Sex stereotyping

Under this protection, individuals cannot be denied healthcare or health coverage based on their sex, including their gender identity and sex stereotyping. This means that women must be treated equally with men regarding the healthcare and insurance they receive. In addition, categorical coverage exclusions or limitations for all healthcare services related to gender transition are discriminatory.

In general, individuals must be treated consistently with their gender identity, including in access to facilities. However, providers may not deny or limit treatment for any health services that are ordinarily or exclusively available to individuals of one gender based on the fact that a person seeking those services identifies as belonging to another gender. Sex-specific health programs or activities are permissible only if the entity can demonstrate an exceedingly persuasive justification (that is, that the sex-specific health program or activity is substantially related to the achievement of an important health-related or scientific objective).

The final rule does not resolve whether discrimination on the basis of an individual's sexual orientation status alone is a form of sex discrimination under Section 1557. However, OCR will evaluate complaints that allege sex discrimination related to an individual’s sexual orientation in order to determine if they involve the type of stereotyping that can be addressed under Section 1557. HHS supports prohibiting sexual orientation discrimination as a matter of policy, and will continue to monitor legal developments on this issue.

Protections for individuals with limited English proficiency

Consistent with longstanding civil rights law principles, the final rule clarifies that the prohibition on national origin discrimination requires covered entities to take reasonable steps to provide meaningful access to individuals with limited English proficiency who is eligible to be served or likely to be encountered within the entities' health programs and activities. An individual with limited English proficiency is a person whose primary language for communication is not English and who has a limited ability to read, write, speak, or understands English principle.

Reasonable steps may include the provision of language assistance services, such as oral language assistance or written translation. The standards in the final rule are flexible and context-specific, taking into account factors such as the nature and importance of the health program and the communication at issue, as well as other considerations, including whether an entity has developed and implemented an effective language access plan.

Covered entities are required to post a notice of individuals’ rights, providing information about communication assistance for individuals with limited English proficiency, among other information. In each state, covered entities must post taglines in the top 15 languages spoken by individuals with limited English proficiency in that state that indicate the availability of language assistance. OCR has translated a sample notice of nondiscrimination and the taglines for use by covered entities into 64 languages. For translated materials, visit HHS’ website.

Covered entities are prohibited from using low-quality video remote interpreting services or relying on unqualified staff or translators when providing language assistance services. Instead, they are encouraged to develop and implement a language access plan to ensure they are prepared to take reasonable steps to provide meaningful access to each individual who may require assistance.

Protections for individuals with disabilities

Consistent with existing requirements, Section 1557 requires covered entities to take appropriate steps to ensure that communications with individuals with disabilities are as effective as communication with others. Section 1557 also requires covered entities to provide appropriate auxiliary aids and services (such as alternative formats and sign language interpreters) where necessary for effective communication.

Section 1557 incorporates the 2010 Americans with Disabilities Act (ADA) Standards for Accessible Design as the standards for physical accessibility of new construction or alteration of buildings and facilities. Almost all covered entities are already required to comply with these standards. In addition, under Section 1557, covered entities:

  • Must post a notice of individuals’ rights, providing information about communication assistance among other information
  • Must make all programs and activities provided through electronic and information technology accessible to individuals with disabilities, unless doing so would impose undue financial or administrative burdens or would result in a fundamental alteration in the nature of the covered entity’s health program or activity
  • Cannot use marketing practices or benefits designs that discriminate on the basis of disability
  • Must make reasonable changes to policies, practices and procedures, where necessary, to provide equal access for individuals with disabilities, unless the covered entity can demonstrate that making the changes would fundamentally alter the nature of the health program or activity.

For more information about Section 1557 and the final rule, visit HHS’ website. HHS has also issued a set of frequently asked questions (FAQs) on the Section 1557 final rule.

Source: The Department of Health and Human Services