On May 18, 2016, the U.S. Department of Health and Human Services (HHS) published a final rule implementing Section 1557 of the Affordable Care Act. Section 1557 and the new rule, entitled “Nondiscrimination in Health Programs and Activities,” prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities receiving federal financial assistance (excluding Medicare Part B). Covered entities under this rule, as defined by HIPAA, include healthcare providers, payers, and clearinghouses.

The rule incorporates the nondiscrimination provisions found in Title IX of the Education Amendments of 1972 (sex), Title VI of the Civil Rights Act of 1964 (race, color, and national origin), the Age Discrimination Act (age), and Section 504 of the Rehabilitation Act (disability). Additionally, covered entities who participate in government healthcare programs are required to take the following actions in order to comply with the rule:

1. Covered entities should review and revise current policies in accordance with the rule

In particular, covered entities should be aware that the rule expands the definition of sex discrimination to include discrimination based on gender identity and sex stereotyping. As such, categorical exclusions or limitations for all health care services related to gender transition will be considered discriminatory. Further, the rule requires covered entities to treat individuals consistent with their gender identity.

2. Covered entities must provide language services, free of charge and in a timely manner, to individuals with limited English proficiency

HHS recommends that covered entities create and abide by a Language Access Plan that contains policies establishing how an individual needing language assistance services will be identified, notified of, and provided with the necessary services. The rule also outlines specific requirements regarding the use of interpreters, translators and video remote interpreting services.

3. Covered entities must make electronically-provided services or systems accessible to persons with disabilities and provide auxiliary aids and services

The rule requires covered entities to take appropriate steps to ensure effective communication with individuals with disabilities, unless doing so would create an undue burden or fundamentally alter the nature of the health program or activity. Entities can comply with this provision by providing sign language interpreters, materials in alternative formats, assistive listening devices, or other similar services and actions.

4. By October 16, 2016, covered entities must post notices stating the entity’s nondiscrimination policy and notifying individuals with limited English proficiency of the availability of language assistance services

Nondiscrimination notices must be posted in significant publications and communications, in a conspicuous physical location where the entity interacts with the public, and in a conspicuous location on the entity’s website. Alongside the notice, “taglines” alerting individuals to the availability of language assistance services must be posted in at least the top 15 non-English languages spoken in the entity’s state (click here for sample taglines).

5. Covered entities with 15 or more employees must adopt a grievance procedure and designate a Section 1557 compliance coordinator to facilitate prompt and equitable resolution of grievances

Current grievance procedures must be expanded to address discrimination based on race, color, national origin, age and sex. The Section 1557 compliance coordinator will be tasked with facilitating prompt and equitable resolution of grievances arising under Section 1557.

This new nondiscrimination rule presents many potential pitfalls for covered entities.