Is your organization compliant with the new ACA non-discrimination final rule?

Earlier this year, the Health and Human Services (HHS) Office for Civil Rights (OCR) issued the final rule implementing the Affordable Care Act’s (ACA) non-discrimination provisions. The rule became effective on July 18, 2016. Section 1557 of the ACA prohibits discrimination in health care and coverage based on race, color, national origin, disability and sex. All organizations subject to Section 1557 should take immediate action to achieve full compliance with the new requirements.

Section 1557 expands on existing federal non-discrimination and civil rights laws, including Title VI of the Civil Rights Act of 1964 (Title VI), Title IX of the Education Amendments of 1972 (Title IX), Section 504 of the Rehabilitation Act of 1973 (Section 504) and the Age Discrimination Act of 1975 (Age Act). However, Section 1557 is the first federal law to prohibit discrimination on the basis of sex in all health programs and activities receiving federal financial assistance. As a result, some of the most significant and widely publicized new requirements are related to sex discrimination and gender identity.

Which organizations are covered?

Providers. The final rule covers any health program or activity that receives funding from HHS. This includes hospitals, physicians and other providers that accept Medicare and/or Medicaid.

Programs. The final rule covers any health program that HHS itself administers.

Health insurance marketplaces and issuers. The final rule covers all health insurance marketplaces (or exchanges) established under the ACA and all health plan issuers that participate in the marketplaces.

What protections are available?

Sex and gender identity. Under the final rule, women and men must be treated equally with regard to the health care they receive. Health care or coverage may not be denied by a covered entity based upon the individual’s sex. This includes discrimination based on gender identity, pregnancy and sex stereotyping. In addition, the final rule requires that individuals be treated consistent with their gender identity.

In response to comments received on the proposed rule, OCR declined to resolve the question of whether discrimination on the basis of sexual orientation status alone is a form of sex discrimination under Section 1557. However, in the commentary to the final rule, OCR noted that it will evaluate complaints that allege sex discrimination related to sexual orientation to determine if they involve sex stereotyping that can be addressed by OCR under Section 1557.

Disabilities. The final rule establishes a number of new protections for individuals with disabilities. Covered entities must now make all programs and activities provided through electronic and information technology accessible, ensure the physical accessibility of newly constructed or altered facilities, and provide auxiliary aids and services for individuals with disabilities.

Covered entities are also prohibited from using marketing practices or benefit designs that discriminate on the basis of disability and other prohibited bases. Due to the difficulty in changing health plan benefit designs midway through a plan year, OCR deferred this requirement to the first day of the next plan year beginning on or after January 1, 2017.

Limited english proficiency. Under the final rule, covered entities must take reasonable steps to provide “meaningful access” to individuals with limited English proficiency who are eligible to be served or likely to be encountered in their health programs or activities. The rule also encourages covered entities to establish a language access plan.

What are the procedural requirements?

Grievance procedure and compliance coordinator. The final rule requires all covered entities with 15 or more employees to have a grievance procedure and a compliance coordinator. A model grievance procedure is provided as an appendix to the final rule.

Notices and taglines. In order to ensure compliance with the limited English proficiency provisions, the final rule requires covered entities to post notices of nondiscrimination and taglines that alert individuals to the availability of language assistance services. The OCR website provides sample notices and taglines that have been translated into 64 languages. The rule requires covered entities to include taglines in at least the top 15 non-English languages spoken in the state(s) in which the entity is located or does business. For smaller-sized communications (i.e., postcards), the rule requires translations in only the top two non-English languages.

Training. While the final rule does not contain a training requirement, OCR “strongly encourages” covered entities to train their employees on compliance with Section 1557. A sample presenter’s guide and slide deck has been posted to the OCR website.  

How will OCR enforce Section 1557?

Notably, OCR has been conducting nondiscrimination enforcement activities since Section 1557 was enacted in 2010. The OCR website lists ten case examples highlighting enforcement activities. All ten of these examples involve allegations of discrimination based on sex or gender identity, and several resulted from complaints made by transgendered individuals.

OCR utilizes the existing enforcement mechanisms under Title VI, Title IX, Section 504 and the Age Act in order to redress violations of Section 1557. Informal enforcement mechanisms include: conducting compliance reviews and complaint investigations, providing technical assistance and guidance, and requiring covered entities to keep records and submit compliance reports. Covered entities in violation of Section 1557 may also be subject to formal enforcement actions, including suspension of, termination of, or refusal to grant or continue federal financial assistance. Further, covered entities may be referred to the Department of Justice with recommendations to bring proceedings to enforce any rights of the United States.

Finally, the final rule clarifies that affected individuals may bring civil actions against covered entities to challenge alleged Section 1557 violations.