Medicare Compliance & Reimbursement

Proposed rule would allow patients to sue you under Section 1557.

When Congress passed the Patient Protection and Affordable Care Act (ACA) in 2010, Section 1557 of the law provided a plethora of new protections for healthcare consumers, in particular protections covering sex- and gender identity-related discrimination. And now the U.S. Department of Health and Human Services (HHS) is poised to make those protections more concrete.

Here’s what you need to know to protect your organization from a discrimination lawsuit:

Pay Attention to New Sex Discrimination Rule

On Sept. 3, HHS issued a proposed rule, Nondiscrimination in Health Programs and Activities, that codifies and expands the protections contained in Section 1557 of the ACA. The ACA “is the first federal civil rights law to prohibit discrimination, including denial of health services or health coverage, on the basis of race, color, national origin, age, disability, or sex,” says healthcare attorney Pia Dean with the law firm Holland & Hart, LLP, in Denver.

Background: Before the ACA’s passage, civil rights laws enforced by the HHS Office for Civil Rights (OCR) prohibited discrimination based on race, color, national origin, disability, or age. But no federal law provided comprehensive protection against sex discrimination in healthcare, according to the National Women’s Law Center (NWLC).

The ACA added discrimination protections based on sex, with many provisions that address specific inequities in the healthcare marketplace, such as excluding maternity care from health insurance plans and failing to provide contraceptive coverage to women, the NWLC explains. “Section 1557, however, applies longstanding sex discrimination prohibitions across the board and to all aspects of healthcare, including some not addressed explicitly by the ACA.”

And with this proposed rule, “HHS intends to address some of the populations that have historically been subject to discrimination,” Dean explains. “The proposed rule specifically addresses the rights of women and transgendered individuals.”

“This proposed rule is an important step to strengthen protections for people who have often been subject to discrimination in our healthcare system,” HHS Secretary Sylvia Burwell said in a recent statement. “This is another example of this Administration’s commitment to giving every American access to the healthcare they deserve.”

Regulation Applies to Nearly All Health Entities

Scope: Section 1557’s latitude is broad and far-reaching, and it applies to a wide range of health programs and entities, according to the NWLC. Section 1557 protects individuals from discrimination in:

Any health program or activity of a recipient of federal financial assistance, such as hospitals, clinics, employers, or insurance companies that receive federal money. This also includes visiting nurse programs, community health education interventions, and similar programs that receive federal dollars, as well as entities that receive federal financial assistance in the form of contracts of insurance, credits, or subsidies.

Any program or activity that an executive agency administers, including federal health programs like Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP).

Any program or activity created under Title I of the ACA, including the new state health insurance exchanges.

“The proposed rule prohibits insurers in any exchange from denying, canceling, limiting, or refusing to issue or renew any of its insurance policies or employing marketing practices or benefit designs that discriminate on the basis of race, color, national origin, sex, age, or disability,” Dean says. “Similarly, hospitals and other healthcare providers that receive federal financial assistance from HHS are also accountable for discrimination in the health plans they offer to their employees.”

What’s more: Notably, the proposed rule’s broad definition of “health program or activity” would include all the covered entity’s health-related operations, whether providing or administering health services or health insurance coverage, and not just the portion for which it receives federal financial assistance, according to an October 2015 Epstein Becker & Green, P.C. analysis by attorneys Lynn Shapiro Snyder and Helaine Fingold.

Nix These Soon-to-Be-Prohibited Practices Now

Heads up: If finalized, Dean says the proposed rule would enforce the following protections:

• Equal treatment for women in the healthcare they receive, including prohibiting discrimination in the health coverage and health services that women receive from providers;
• Providers and health insurers cannot deny healthcare or health coverage based on an individual’s sex, including their gender identity;
• Explicit categorical exclusions in coverage for healthcare services related to gender transition are facially discriminatory, and other exclusions for gender transition will be evaluated on a case-by-case basis; and

Providers cannot deny or limit sex-specific healthcare solely because the person seeking such services identifies as belonging to another gender (for example, a provider may not deny an individual treatment for ovarian cancer based on the individual’s identification as a transgendered man, where the treatment is medically indicated).

Watch out: Although the ACA has allowed individuals to submit complaints to OCR since the law’s passage in 2010, the proposed rule would clarify that individuals who believe they’ve been subject to discrimination in healthcare will have a private right of action, Dean notes.  This means that the ACA and the proposed rule gives individuals the ability to sue under Section 1557.

Additionally, HHS sought public comments regarding possibly including an exemption for religious organizations and the scope of any such exemption, Dean says. But nothing in the proposed rule affects the existing protections for religious beliefs and practices, including provider conscience laws and ACA regulations related to contraceptive services. HHS held open the public comment period on the proposed rule until Nov. 9 and received approximately 2,188 comments.

Link: You can view the entire proposed rule in the Sept. 8 Federal Register at www.federalregister.gov/articles/2015/09/08/2015-22043/nondiscrimination-inhealth- programs-and-activities.