In May, the Department of Health and Human Services (“HHS”) published a final rule implementing Section 1557 of the Affordable Care Act (“ACA”). The rule prohibits discrimination on the basis of race, color, national origin, sex, age, or disability, by any health program or activity, any part of which receives federal funding or assistance. These regulations impose additional administrative requirements on covered entities that receive funding from HHS for the operation of a health program or activity.

Covered Entities – A “covered entity” is any entity that operates any health program or activity any part of which receives federal financial assistance from HHS. The term “health program or activity” includes all of the operations of an entity principally engaged in providing or administering health services or health insurance coverage. Entities such as a hospital, health clinic, community health center, group health plan, health insurance issuer, physician’s practice, nursing facility, or residential or community-based treatment facility would be a covered entity.

In addition, the preamble to the regulations provides that a group health plan is an entity primarily engaged in health coverage, and therefore a type of health program or activity. If a plan sponsor receives funding from HHS, a primary objective of which is to fund its group health plan, then the group health plan must not discriminate with respect to the benefits provided. Retiree drug subsidy payments from the Center for Medicare & Medicaid Services are payments from HHS.

Conduct Prohibited – To the extent an entity meets the definition of a “covered entity,” discrimination on the basis of race, color, national origin, sex, age, or disability is prohibited by Section 1557. Discrimination by a group health plan can take the form of discriminatory benefit design, coverage carve-outs, limits on health coverage, benefit claim denial, denial or refusal to issue or to renew a health insurance plan or coverage, discriminatory marketing, or the imposition of additional cost sharing.

It is important to note that Section 1557’s prohibition against “sex discrimination” includes gender identity discrimination. The regulations specifically reinforces that lesbian, gay, bi-sexual and transgender (LGBT) individuals cannot be discriminated against in receiving health care services or group health care coverage or health insurance based on their sex, including their gender identity and their nonconformity with sex stereotypes. Discrimination against LGBT people or against any other protected persons under Section 1557 can take the form of refusal of treatment, harassment, delivery of different care, or denial of access to facilities. Specifically, a covered entity may not categorically exclude all health services related to gender transition, but it may still determine whether a particular health service is medically necessary or meets applicable coverage requirements in any individual case.

Administrative Requirements – Covered entities must post a notice (either at the workplace or on a website) indicating:

  1. The entity’s nondiscrimination policy;
  2. The availability of auxiliary aids and services where necessary, at no cost;
  3. Translation and language assistance services;
  4. How to receive these supplemental services;
  5. The name and contact information of the compliance person;
  6. Complaint and grievance procedures; and
  7. How to file a discrimination complaint with OCR.

This notice, and all other significant publications targeted to beneficiaries or the public, must include a nondiscrimination tagline alerting limited English proficiency individuals that language assistance services are available. This tagline must be posted in at least the top 15 non-English languages spoken in the state in which the entity is located or conducts business. One approved list of languages is available here: The notice should be posted by October 17, 2016.

In addition, covered entities must institute a grievance procedure for resolution of Section 1557 complaints and must designate a compliance coordinator, who is required to maintain records of all grievances. Finally, the regulations include other requirements such as enhanced language assistance for people with limited English proficiency.