The Patient Protection and Affordable Care Act (ACA) Section 1557 provides that individuals shall not be excluded from participation in, denied the benefits of, or be subjected to discrimination under any health program or activity which receives federal financial assistance from the Department of Health and Human Services (HHS), on the basis of race, color, national origin, sex, age, or disability.
On May 13, 2016, HHS issued a final rule (current rule) implementing Section 1557, which took effect on July 18, 2016.
The current rule applies to any program administered by HHS or any health program or activity administered by an entity established under Title I of the ACA. These applicable entities are “covered entities” and include a broad array of providers, employers, and facilities. State-based Marketplaces are also covered entities, as are Federally-Facilitated Marketplaces. For entities that were required to make changes to health insurance or group health plan benefit design as a result of the current rule, the current rule applied as of the first day of the first plan year beginning on or after January 1, 2017.
On October 15, 2019, the U.S. Disrict Court for the Northern District of Texas (District Court) vacated portions of the current rule implementing Section 1557 that prohibit discrimination on the basis of gender identity and pregnancy termination. The District Court remanded the vacated portions of the current rule to HHS for revision. While those portions of the current rule have been vacated, covered entities subject to Section 1557 may still face private lawsuits for discrimination based on gender identity and pregnancy termination.
Employers who are subject to Section 1557 should stay informed on this litigation because it is anticipated that the District Court’s ruling will be appealed to the Fifth Circuit Court of Appeals.
Download the full ACA Advisor to read more about how the current and proposed rules address discrimination based on sex, gender, and sexual orientation, and implications for health marketplaces and health plans.