Legal Alert

CMS Scales Back ACA Nondiscrimination Rules

by the Employee Benefits and Executive Compensation Group
June 15, 2020

The Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) has finalized rules that narrow and eliminate various nondiscrimination requirements under Section 1557 of the Affordable Care Act (Act).

Section 1557 prohibits certain health care providers, health benefit plans, and health insurers from discriminating against individuals on account of race, color, national origin, sex, age, and disability.

The final rules make no significant changes to the rules that CMS proposed one year ago that cut back on some of the most significant requirements in prior regulations. As a result, the Section 1557 regulations will no longer:

  • define sex discrimination to include gender identity and sex stereotyping;
  • require certain health plans and insurers to cover gender reassignment surgery;
  • maintain specific grievance procedures to address complaints of discrimination under section 1557; or
  • require the distribution of nondiscrimination notices and foreign language taglines.

The new final rules also narrow the application of the nondiscrimination requirements to apply to health insurers only for programs and activities that receive financial assistance from HHS and to HHS programs and activities only if they are provided (or provided by an entity established) under Title I of the ACA.

Final rules issued at the same time also protect conscience-based objections to the provision of certain medical treatments.

The regulations tie the rules more closely to nondiscrimination requirements under laws that were in effect prior to the ACA and, therefore, to judicial interpretation that continues to emerge under those laws.

The changes to the rules take effect 60 days after its publication in the Federal Register.

As the federal health care reform effort gained steam, Ballard Spahr attorneys established the Health Care Reform Initiative to monitor and analyze legislative developments. With federal health care reform now a reality, our attorneys are assisting health care entities and employers in understanding the relevant changes and planning for the future. They also have launched the Health Care Reform Dashboard, an online resource center for news and analysis on developments under the Affordable Care Act.

Attorneys in Ballard Spahr’s Employee Benefits and Executive Compensation Group help clients design and implement compensation and benefits packages that comply with today’s complex regulatory requirements, attract and retain a quality workforce, and maintain fiscal and fiduciary responsibility.

Copyright © 2020 by Ballard Spahr LLP.
(No claim to original U.S. government material.)

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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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