Medicare Compliance & Reimbursement

Section 1557’s gender identity provisions are already facing pushback from religious groups.

Nondiscrimination laws have been around for decades, and you may feel like your organization has a good handle on what not to do. But those rules are changing — pay attention to this new regulation that takes nondiscrimination in healthcare a big step further.

1. Understand the New Nondiscrimination Requirements

Background: The new nondiscrimination regulation stems from the Affordable Care Act of 2010 (ACA), specifically Section 1557 of the law. On May 13, the HHS Office for Civil Rights (OCR) issued the final rule implementing Section 1557, and the rule’s general requirements first became effective as of July 18.

At its core, Section 1557 is the nondiscrimination provision of the ACA, prohibiting discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities. These nondiscrimination protections are nothing new — Section 1557 merely builds on the long history of federal civil rights laws dating back to the 1960s and 1970s.

But the new Nondiscrimination Rule extends such protections to individuals participating in:

• Any health program or activity any part of which received funding from HHS (such as from Medicare or Medicaid);
• Any health program or activity that HHS itself administers; and
• Health Insurance Marketplaces and all plans offered by issuers that participate in those Marketplaces.

This means that all health programs that receive federal financial assistance, including hospitals, nursing homes, physician practices, rehabilitation centers, health insurance issuers, and state Medicaid agencies, must comply with the new final rule, according to an Aug. 22 analysis by attorneys Stacey Callaghan and Zarra Elias of Akerman LLP.

The final rule’s procedural requirements, including developing a grievance procedure and posting a notice of your nondiscrimination policies, go into effect on Oct. 16.

Crucial: You should train your employees on these nondiscrimination rules, and you can find training materials (including a slide deck and presenter’s guide) on the OCR’s website at www.hhs.gov/civil-rights/for-individuals/section-1557/trainingmaterials/index.html.

2. Cater to LEP Patients and Those with Disabilities

The final rule pays specific attention to certain protected classes and groups of individuals — namely, women; lesbian, gay, bisexual, and transgender (LGBT) individuals; persons with disabilities; and individuals with limited English proficiency (LEP).

For individuals with disabilities, the final rule prohibits covered entities (CEs) from using marketing practices or benefit designs that discriminate on the basis of disability or other prohibited bases. The rule also requires CEs to:

• Make accessible all programs and activities provided through electronic and information technology;
• Ensure the physical accessibility of newly constructed or altered facilities; and
• Provide appropriate auxiliary aids and services for individuals with disabilities.

For LEP individuals, the rule requires CEs to take “reasonable steps” to provide meaningful access to each person with LEP. HHS encourages CEs to develop and implement a language access plan.

3. Tread Carefully Regarding Gender Identity

Although sex discrimination in healthcare is nothing new, Section 1557 builds on prior federal laws, requiring that CEs treat women equally with men in the healthcare they receive and prohibiting the denial of healthcare or health coverage based on an individual’s sex. The rule specifies that “sex discrimination” includes discrimination based on not only an individual’s sex/gender, but also pregnancy, gender identity, and sex stereotyping.

And one crucial element in Section 1557 is the mandate that you must treat individuals consistent with their gender identity.

Significance: Section 1557 “is the first federal civil rights regulation to bar discrimination in covered healthcare services based on sex, including pregnancy, certain medical conditions, termination of pregnancy, gender identity, and sex stereotypes,” stated the American Gastroenterological Association (AGA) in a recent summary of the final rule.

Further, the final rule “also provides important new civil rights protections for members of the LGBT population, because it broadens the definition of sex discrimination to encompass gender identity, including gender expression, transgender status, and non-binary gender identity,” the AGA pointed out.

4. Post Nondiscrimination Notice and ‘Taglines’

One of the key requirements under the new Nondiscrimination Rules is that CEs (which includes most healthcare providers) must post and publish new mandatory nondiscrimination statements and taglines by Oct. 16, says healthcare attorney Kim Stanger of Holland & Hart LLP.

According to Stanger, your new “Notice of Nondiscrimination” must inform individuals that the CE:

1. Does not discriminate on the basis of race, color, national origin, sex, age, or disability in its health programs and activities;
2. Provides appropriate auxiliary aids and services, including qualified interpreters for individuals with disabilities and information in alternate formats, free of charge and in a timely manner, when such aids and services are necessary to ensure an equal opportunity to participate for individuals with disabilities;
3. Provides language assistance services, including translated documents and oral interpretation, free of charge and in a timely manner, when such services are necessary;
4. Provides instructions on how to obtain such aids and services;
5. Has a designated employee (including the person’s name and contact information) responsible for coordinating the CE’s compliance (if the CE has 15 or more employees);
6. Makes available the grievance procedure and instructions on how to file a grievance (if the CE has 15 or more employees); and
7. Provides instructions on how to file a discrimination complaint with the OCR.

OCR offers sample documents of a Notice of Nondiscrimination, Statement of Nondiscrimination, and Taglines, all available for download and translated into 64 languages at www.hhs.gov/civil-rights/for-individuals/section-1557/translated-resources/index.html.

Note: Although the U.S. Department of Human and Health Services (HHS) encourages CEs to post their Notice of Nondiscrimination in languages other than just English, you aren’t required to do so, Stanger says.

You must post the Notice of Nondiscrimination in physical locations where the public can see it, on your website in a conspicuous place accessible from the home page, and in significant communications like handbooks and outreach publications, the AGA notes.

5. Determine if You Need a Grievance Procedure

Additionally, if your organization has 15 or more employees, HHS now requires you to have a grievance procedure and a compliance coordinator.

Your grievance procedure must incorporate appropriate due process standards and resolve grievances in a timely and fair manner, according to the AGA.

You also must designate at least one employee to serve as your Section 1557 compliance coordinator. This person is responsible for investigating grievances and assuring compliance.

6. Brace Yourself for Enforcement

OCR will be in charge of enforcing Section 1557 and will use existing enforcement remedies like those under other federal civil rights laws. Punishments for noncompliance may include:

• Oversight and compliance reports to OCR;
• Compliance reviews;
• Complaint investigations;
• Technical assistance and guidance;
• Suspension/termination of or refusal to grant/continue federal financial assistance;
• Referral to the U.S. Department of Justice (DOJ); and/or
• Any other means authorized by law.

Watch out: Keep in mind that an individual may bring a civil action against you to challenge a Section 1557 violation, the OCR warns.

Expect Some Bumps in the Road

And speaking of civil actions, eight plaintiffs are jointly suing HHS in a federal court over the new final rule, disputing the definition of the term “sex” in Section 1557, according to an Aug. 25 alert by the law firm Hall, Render, Killian, Heath & Lyman, P.C.

The plaintiffs, who are from five states and three religious organizations, claim that HHS’ interpretation of “sex” violates various laws and constitutional protections applicable to states, religious entities, and individuals.

“The majority of the complaint focuses on the plaintiffs’ views that they should not have to provide equal services and insurance coverage to transgender patients as required by HHS in its regulations,” Hall Render stated. “They also claim that the HHS regulations violate religious and other freedoms to which providers are entitled when deciding whether to terminate a pregnancy.”

The outcome of this and other legal claims could change Section 1557 and its provisions. But for now, you must comply with the final rule as written. To read the complaint, visit www.hallrender.com/library/articles/2674/complaint.pdf.

Resources: For more information on Section 1557, including a wide variety of materials and sample documents, fact sheets, and frequently asked questions, go to www.hhs.gov/civil-rights/for-individuals/section-1557/index.html. The final rule, “Nondiscrimination in Health Programs and Activities,” is available at https://www.gpo.gov/fdsys/pkg/FR-2016-05-18/pdf/2016-11458.pdf.