June 24, 2020

HHS Issues Final Rule on Section 1557

Holland & Knight Healthcare Blog
Miranda A. Franco
Healthcare Blog

Under Section 1557 of the Affordable Care Act (Section 1557), "covered entities," which were defined as health programs or activities that receive "federal funding" from the U.S. Department of Health and Human Services (HHS) cannot discriminate on the basis of race, color, national origin, disability, age or sex. Beginning in 2010, "sex" in this context included protections on the basis of gender identity – meaning that covered entities could not discriminate against transgender patients.

These protections based on gender identity were challenged in 2016. In May 2019, HHS issued a notice of proposed rulemaking on Section 1557, and in June 2019, it began accepting public comment on its proposed rule, which excluded protections based on gender identity.

On June 12, 2020, HHS issued its final rule, which removed healthcare protections based on gender identity from Section 1557. In short, the HHS said that gender identity is not captured within Title IX's prohibition against discrimination "on the basis of sex."

However, that was not the only change to Section 1557 under the final rule. The final rule limits the scope of which entities are "covered" and so must comply with the rule. Under the final rule, to be captured, an entity must be "principally engaged in the business of providing healthcare" or, for entities outside of that scope, HHS must fund the particular activity.

The final rule eliminates its previous definitions of terms – as well as its enumerated examples of prohibited practices. It also eliminates specific requirements that covered entities make information available to those with limited English proficiency – namely the requirement that certain notices be distributed in at least 15 languages.

The 2020 final rule will go into effect on Aug. 18, 2020.

Language Access Requirements

Federal law requires all covered entities to "take reasonable steps to provide meaningful access to each individual with limited English proficiency."

These general requirements are still in place under the 2020 rule. Specifically, the Office of Civil Rights (OCR) reiterates that the following requirements continue to apply:

  • covered entities may not require an individual with LEP to bring his or her interpreter or rely on a minor child or accompanying adult to facilitate communication, except under limited exceptions
  • translation/interpretation services, when required, must be at no cost
  • translators or interpreters provided must meet specific minimum qualifications, including ethical principles, confidentiality, proficiency, effective interpretation and the ability to use specialized terminology as necessary in the healthcare setting

Notices of Nondiscrimination

The 2020 rule does make changes to the steps that covered entities should take to assess the language needs of individuals that they encounter to decide what reasonable steps if any, they should take to ensure meaningful access for LEP persons. The 2016 rule required covered entities to issue a notice of nondiscrimination stating that the entity does not discriminate, how an individual may file a complaint if he or she believes discrimination has occurred, and regarding the availability of nondiscrimination assistance services, among other things. That rule also required that taglines, or brief statements of nondiscrimination, be posted in the top 15 non-English languages spoken by individuals with limited English proficiency in the state or states where the entity operates. The taglines had to appear on the entity's website and in significant publications, as well as in the physical office.

The 2020 rule eliminates both of those requirements. Covered entities still are required to provide a notice of nondiscrimination based on regulations implementing other civil rights laws. However, instead of broadly requiring taglines for all significant communications, the 2020 rule requires covered entities to provide taglines only when "necessary to ensure meaningful access."

Grievance Procedures

The 2020 rule repeals former requirements for practices with 15 or more employees to 1) designate one staff member to coordinate compliance efforts and carry out Section 1557 responsibilities, including handling any grievances investigations, and 2) establish grievance procedures to provide prompt and equitable resolution of any allegation of discrimination.

These no longer apply for purposes of Section 1557, but there may be similar requirements under other federal laws.

Supreme Court Decision

On June 15, 2020, the U.S. Supreme Court issued a decision concluding that Title VII of the Civil Rights Act of 1964 prohibits employment discrimination against lesbian, gay, bisexual and transgender (LGBT) people. There is no direct impact on the Trump Administration's final rule on Section 1557. However, the Supreme Court's ruling calls into question the validity of OCR's approach to sex nondiscrimination and the decision to interpret "sex" solely as "biological sex." While the Supreme Court opinion speaks exclusively to Title VII and Section 1557 speaks to Title IX for purposes of sex discrimination, given the similar protections of Title IX and Title VII, which apply "on the basis of" sex, it is expected that the removal of "gender identity" from the protections of Section 1557 will bring about new challenges to the final rule. There has been no comment yet from the administration.

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