HHS to Enforce Section 1557 of the Affordable Care Act to Prohibit Discrimination Based on Sexual Orientation and Gender Identity

The U.S. Department of Health and Human Services (HHS) announced on May 10 that its Office for Civil Rights (OCR) will begin enforcing Section 1557 of the Affordable Care Act to prohibit discrimination based on sexual orientation and gender identity. Section 1557 prohibits many health care providers and certain health plans from discriminating against individuals on the basis of race, color, national origin, age, sex, or disability. In setting these prohibitions, the Section makes reference to grounds established under other civil rights statutes. For sex discrimination, those grounds are found in Title IX of the Education Amendments to the Civil Rights Act of 1964 (Title IX).

The HHS announcement marks the latest in a series of developments rejecting revisions made last year to the regulations under Section 1557 that sought to narrow the meaning of sex discrimination to exclude sexual orientation and gender identity. The most significant of these developments actually preceded the publication of the revised regulations by a few days. In Bostock v. Clayton County, GA, 140 S. Ct. 1731 (2020), the Supreme Court held that the prohibitions against employment discrimination “because of sex” in Title VII of the Civil Rights Act of 1964 (Title VII) encompass discrimination based on sexual orientation and gender identity. Finding that Title IX should be interpreted as broadly as Title VII in this regard, district courts in New York and the District of Columbia ruled that the change in the definition of sex discrimination in the revised regulations was invalid under Bostock and restored certain aspects of the regulations in effect before last year’s revisions. After coming into office, President Biden issued Executive Order 13988, directing federal agencies to review laws (beyond Title VII) that prohibit discrimination on the bases of sex to determine whether they should also prohibit discrimination based on sexual orientation and gender identity. In March, the Department of Justice issued a memorandum that concluded that Title IX prohibits such discrimination.

The recent announcement does not mean that OCR will seek to enforce all of the Section 1557 regulatory provisions as if the revisions made last year never took place. There were changes in the regulations that addressed matters other than sex discrimination (for example, narrowing the scope of when Section 1557 applies generally and removing the certain notice requirements, including the requirement to post taglines in 15 different languages in significant communications). These changes are unaffected by the new announcement. With respect to sex discrimination, the announcement says that OCR will enforce the rules in a manner consistent with other laws and existing court orders, which sets the stage for future litigation, including a district court’s reconsideration of its injunction of certain sex discrimination provisions in the pre-2020 regulations and challenges to the application of the sex discrimination rules to religious entities, and the prospect of additional changes to the Section 1557 regulations.

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