On June 14, 2019, the Department of Health and Human Services (HHS) proposed what it describes as “substantial revisions” to its regulations implementing Section 1557 of the Affordable Care Act. Section 1557 prohibits discrimination based on race, color, national origin, sex, age, and disability in health programs and activities receiving federal financial assistance. Notably, it is the first federal civil rights law to prohibit discrimination in health care based on sex. The 60-day public comment period on the proposed changes closes on August 13, 2019. The proposal cannot change Section 1557’s protections in the law enacted by Congress but would significantly narrow the scope of the existing HHS implementing regulations, if finalized, by:

  • Eliminating the general prohibition on discrimination based on gender identity, as well as specific health insurance coverage protections for transgender individuals;
  • Adopting blanket abortion and religious freedom exemptions for health care providers;
  • Eliminating the provision preventing health insurers from varying benefits in ways that discriminate against certain groups, such as people with HIV or LGBTQ people;
  • Weakening protections that provide access to interpretation and translation services for individuals with limited English proficiency;
  • Eliminating provisions affirming the right of private individuals to challenge alleged violations of § 1557 in court and to obtain money damages, as well as requirements for covered entities to provide non-discrimination notices and grievance procedures;
  • Narrowing the reach of the regulations by only covering specific activities that receive federal funding, but not other operations, of health insurers that are not “principally engaged in the business of providing health care,” and no longer applying the regulations to all HHS-administered programs;

HHS also requests comment on whether to change certain provisions intended to ensure equal access for people with disabilities. It also proposes eliminating prohibitions on discrimination based on gender identity and sexual orientation in 10 other Medicaid, private insurance, and education program regulations outside Section 1557. If finalized, HHS’s proposed changes would substantially narrow, and in many cases entirely eliminate, the regulations’ existing protections against discrimination in meaningful ways.


On June 14, 2019, the Centers for Medicare and Medicaid Services (CMS) and the Office for Civil Rights (OCR) of the Department of Health and Human Services (HHS) proposed what it describes as “substantial revisions” to regulations implementing Section 1557 of the Affordable Care Act (ACA). Section 1557 prohibits discrimination based on race, color, national origin, sex, age, and disability in health programs and activities receiving federal financial assistance. For example, Section 1557 applies to health care providers, such as physicians’ practices, hospitals, nursing homes, and organ procurement centers that receive federal funds such as Medicare (excluding Part B) or Medicaid payments; health-related education and research programs; state Medicaid, CHIP, and public health agencies; health insurance issuers and third-party administrators; state-based Marketplaces; and health programs administered by HHS. This issue brief summarizes and considers the implications of HHS’s proposed regulations and includes tables that provide side-by-side comparisons with legal citations to the current and proposed provisions of HHS’s Section 1557 regulations (Table 1) and HHS’s proposed changes to other regulations, separate from Section 1557 (Table 2). The 60-day public comment period on all of the proposed changes closes on August 13, 2019.

Background and HHS’s Rationale for Proposed Changes

Section 1557 incorporates protections from existing civil rights laws. These include Title VI of the Civil Rights Act of 1964 (race, color, and national origin), Title IX of the Education Amendments of 1972 (sex), the Age Discrimination Act of 1975, and Section 504 of the Rehabilitation Act of 1973 (disability). Notably, Section 1557 is the first federal civil rights law to prohibit discrimination on the basis of sex in health care. Section 1557’s protections took effect when the ACA was enacted on March 23, 2010, and HHS’s implementing regulations were effective on July 18, 2016.

HHS stated that its proposed changes are needed to “address legal concerns,” relieve costs and regulatory burden, and reduce confusion because it now views the regulations as inconsistent with or duplicative of other civil rights provisions. In support of its proposed changes, HHS cited a federal trial court’s preliminary injunction in Franciscan Alliance v. Azar. This case was brought in August 2016 by a group of religiously affiliated health care providers and states, led by Texas, and a decision on the plaintiffs’ motion for summary judgment is now pending before the court. In May 2019, the Trump Administration posted its Section 1557 notice of proposed rule-making (published in the Federal Register on June 14, 2019) and asked the court to stay the proceedings until the proposal is finalized.

The Franciscan Alliance preliminary injunction prohibits HHS from enforcing the Section 1557 regulations that outlaw discrimination on the basis of gender identity or termination of pregnancy but does not require HHS to make any regulatory changes. The trial court has not yet issued a final decision on the merits, and any final decision could be appealed. The December 2016 preliminary injunction order found that HHS’s Section 1557 regulation defining sex discrimination to include gender identity and termination of pregnancy exceeded HHS’s authority as delegated by Congress. Specifically, the court found that HHS should have limited its regulatory definition of sex discrimination to a binary definition encompassing biological differences between males and females. The court also found that HHS should have incorporated Title IX’s blanket abortion and religious exemptions into its Section 1557 regulations.

While the Franciscan Alliance preliminary injunction bars HHS from enforcing its regulations prohibiting discrimination in health care based on gender identify and termination of pregnancy, private individuals still can bring claims alleging Section 1557 violations. Other federal courts that have considered Section 1557 discrimination claims based on gender identity have granted relief to the individual claiming discrimination, based on the text of Section 1557 as enacted in statute. For example, a federal district court issued a preliminary injunction against the Wisconsin Medicaid program’s categorical exclusion of gender affirming services from coverage, relying on the statute as enacted by Congress. Another federal district court case was brought on behalf of a transgender boy, who committed suicide after experiencing “extreme distress” from hospital staff repeatedly referring to him as a girl while he was admitted for psychiatric inpatient care. That court allowed a claim for emotional distress damages to proceed, finding that Section 1557’s statutory language prohibiting sex-based discrimination includes discrimination based on gender identity.

HHS’s proposed changes to its Section 1557 regulations go beyond the issues raised in the Franciscan Alliance case. In addition to gender identity and termination of pregnancy, HHS’s proposed Section 1557 changes would substantially change, or in some cases entirely eliminate, existing provisions related to health insurance benefit design; language access; notices, grievance procedures, and enforcement; and which entities are covered (Table 1). HHS also requests comment on whether to change some disability access provisions. Outside the Section 1557 regulations, HHS proposes removing prohibitions on discrimination based on gender identity and sexual orientation in 10 other Medicaid, private insurance, and education program regulations (Table 2). It also would add abortion and religious exemptions to existing regulations that prohibit sex discrimination in education programs under Title IX.

Key Proposed Changes

Sex Discrimination

Gender Identity

HHS proposes eliminating entirely its Section 1557 regulatory definition of sex discrimination, which includes discrimination based on gender identity and sex stereotyping. HHS also would eliminate the definition of gender identity, which includes gender expression and transgender status. In addition, it would remove specific provisions that require covered entities to treat individuals consistent with their gender identity. The current regulations do not recognize discrimination on the basis of sexual orientation alone as a prohibited form of sex-based discrimination. When finalizing the regulations in 2016, HHS acknowledged that caselaw on this issue is mixed but stated that prohibited sex-based discrimination “includes, at a minimum, sex discrimination related to an individual’s sexual orientation where the evidence establishes that the discrimination is based on gender stereotypes.” The current regulatory definitions are based on caselaw, including lower federal court decisions that have recognized sex-based discrimination as encompassing discrimination based on gender identity and a Supreme Court decision finding that differential treatment of an individual based on their failure to conform to stereotypes about how men or women should behave constitutes sex-based discrimination. In its notice of proposed rule-making, HHS noted that the Supreme Court has agreed to hear cases in the next term about whether sex-based discrimination includes gender identity and sexual orientation; HHS therefore does not propose an alternative regulatory definition of sex discrimination under Section 1557.

Removing gender identity and sex stereotyping from the definition of prohibited sex-based discrimination could allow health care providers to refuse to serve individuals who are transgender or who do not conform to traditional sex stereotypes. For example, a health care provider could refuse to treat a patient for a cold or a broken arm based on the patient’s gender identity or refuse to accept a transgender individual in favor of a person who is not transgender when accepting new patients. The resulting inability to access needed health care services could exacerbate health disparities experienced by LGBTQ people, such as higher rates of depression and suicide attempts, higher risk of HIV/AIDS, higher use of tobacco and drugs, and higher risk of breast cancer.

The proposed regulation would no longer prohibit covered entities from denying, limiting, or imposing additional cost-sharing for services that are ordinarily or exclusively available to one sex or gender when those services are sought by an individual of a different sex or gender. The current regulation prohibits differential coverage or cost-sharing for services based on the fact that an individual’s sex assigned at birth, gender identity, or gender in a medical or health plan record differs from the one to which such services are ordinarily or exclusively available. For instance, under the existing regulation, health plans cannot deny medically necessary treatment for ovarian cancer in a transgender man based on his gender identity nor can they single out services for higher copays only when those services are related to gender transition. Under the proposed regulation, a health plan could deny coverage or impose greater cost-sharing in these circumstances.

The proposed regulation also would eliminate the provision that prohibits a health plan from categorically or automatically excluding or limiting coverage for health services related to gender transition. For example, eliminating this provision could allow an insurer to deny coverage for a hysterectomy that a provider determines is medically necessary to treat a patient’s gender dysphoria, even though hysterectomies are covered in other circumstances. When adopting this provision in 2016, HHS noted that such categorical exclusions are outdated and do not reflect current standards of care.

Abortion and religious exemptions

HHS proposes allowing health care providers and other covered entities to invoke blanket abortion and religious objection exemptions from the regulations’ general prohibition on sex discrimination. The proposed regulation incorporates provisions from Title IX that exempt covered entities from complying with the general prohibition against sex discrimination if doing so (1) involves providing or paying for abortion or (2) would be inconsistent with the organization’s religious tenants. The proposal also exempts entities from having to comply with the Section 1557 regulations if doing so would violate a specific list of existing, as well as any future, federal abortion and religious exemption laws. Additionally, as noted above, HHS proposes entirely eliminating the regulatory definition of sex-based discrimination, which includes discrimination on the basis of pregnancy, false pregnancy, termination of pregnancy, or recovery therefrom, and childbirth or related medical conditions.

The proposed change means that people in need of abortion or other health care services that violate a provider’s religious beliefs could be denied, delayed, or discouraged from seeking necessary care, placing them at risk of serious or life-threatening results in emergencies and other circumstances where the individual’s choice of health care provider is limited. The existing regulation provides that covered entities do not have to comply with Section 1557’s prohibition of discrimination on the basis of sex if doing so would violate existing federal abortion and religious exemption laws, but it does not include a blanket religious exemption. When the Section 1557 regulations were finalized in 2016, HHS rejected incorporating Title IX’s blanket religious exemption because Title IX is limited to educational institutions, which it concluded are significantly different from the health care context. While students and parents typically have a choice about whether to select a religiously affiliated educational institution, individuals’ choice of health care provider may be limited, especially in rural areas, locations where hospitals are run by religious institutions, or emergencies. HHS explained that it instead would rely on the Religious Freedom Restoration Act to make individual case-by-base determinations about “whether a particular application of Section 1557 substantially burdened a covered entity’s exercise of religion, and if so, whether there were less restrictive alternatives available.” This means that, under the current regulation, there may be some instances in which a provider’s religious beliefs will exempt it from providing services to which it objects to an individual, but other instances, based on the facts of a particular case, in which an individual must receive services despite a provider’s religious objection.

Non-Discrimination in Health Coverage

In addition to the specific gender identity provisions discussed above, HHS also would eliminate the entire regulation that prohibits discrimination in health insurance issuance, coverage, cost-sharing, marketing, and benefit design. Under the current regulations, covered entities are prohibited from taking the following actions on the basis of race, color, national origin, sex, age, or disability:

  • Denying, canceling, limiting, or refusing to issue or renew a health insurance policy;
  • Denying or limiting coverage of a health insurance claim;
  • Imposing additional cost sharing or other limitations or restrictions on coverage; or
  • Using discriminatory marketing practices or insurance benefit designs.

Without these provisions, health plans could, for example, cover inpatient treatment for eating disorders for men but not women or cover bariatric surgery for adults except those with certain developmental disabilities. Other benefit designs that might be discriminatory include placing all or most prescription drugs used to treat a specific condition on a health plan’s highest cost formulary tier, applying age limits to services that have been found to be clinically effective at all ages, or requiring prior authorization or step therapy for all or most medications in drug classes such as anti-HIV protease inhibitors or immune suppressants regardless of medical evidence. Insurers also would be permitted to engage in marketing practices designed to encourage or discourage particular individuals from enrolling in certain health plans.

Language Access

HHS proposes relaxing the standards governing access to language assistance services, including oral interpretation and written translation, for individuals with limited English proficiency (LEP). Specifically, HHS would remove the current regulation’s requirement that covered entities take reasonable steps to provide meaningful access to “each individual with LEP eligible to be served or likely to be encountered” and replace it with a general reference to “LEP individuals.” Focusing on LEP individuals in general as opposed to each individual could result in some individuals not receiving the services they need for meaningful access. Language access protections are required to prevent discrimination based on national origin. These services are importance because ineffective communication between health care providers and LEP patients for the purposes of diagnosis, treatment options, proper use of medication, obtaining informed consent, and insurance coverage can result in adverse health consequences or death.

HHS also proposes replacing the current test to determine when covered entities must provide language access services with one that removes the emphasis on the importance of the communication to the specific individual. When determining whether interpretation or translation services are required under the current regulation, HHS gives “substantial weight” to the nature and importance of the health program or activity and the communication at issue to the specific individual. Under the proposed change, HHS would balance a variety of factors to determine when language assistance services are required, including the overall number of LEP individuals eligible to be served or likely to be encountered, the frequency with which any LEP individuals come into contact with the covered program or activity, and the costs involved. HHS also would eliminate the provision that allows HHS to consider whether the covered entity has an effective written language access plan. In addition, HHS proposes eliminating the current remote video interpreting standards and instead include standards only for remote audio interpreting services.

HHS also would eliminate the existing requirement that non-discrimination notices (discussed further below) must include the availability of language assistance services and taglines in the top 15 languages spoken by LEP individuals in the state. HHS observed that repealing the notice and tagline requirements may “[decrease] access to, and utilization of, health care for non-English speakers by reducing their awareness of available translation services” but characterizes the expected impact as “negligible.” HHS also cited comments about regulatory burden from covered entities, including findings from a health insurer that 75% of the 322 enrollees it surveyed “reacted negatively” to a sample document with four pages of taglines; it does not indicate whether any of those enrollees were LEP individuals.

Notice and Enforcement

HHS proposes eliminating all of the existing Section 1557 nondiscrimination notice and grievance procedure requirements. The current regulation requires covered entities with at least 15 employees to adopt a grievance procedure and designate at least one employee to coordinate its Section 1557 responsibilities. Covered entities also currently must provide notice of their nondiscrimination policies in significant communications (such as handbooks and outreach publications), physical locations where the entity interacts with the public, and on their website homepage. HHS noted that “an unknown number of persons are likely not aware of their right to file complaints with the Department’s Office for Civil Rights and some unknown subset of this population may suffer remediable grievances, but will not complain to OCR absent notices informing them of this process” as a result of the proposed change. Based on complaints received since the Section 1557 regulations were finalized, OCR predicted that its long-term caseload would have increased by 5%, with 3% of the overall increase attributable to claims based on gender identity and sex stereotyping.

HHS projected that all of its proposed Section 1557 changes will result in approximately $3.6 billion in undiscounted cost savings over the first five years after implementation, primarily from eliminating the notice and tagline requirements. HHS asserted that its original cost projections for the notice and tagline requirements only accounted for “employee time required to initially download, print, and post notices in public areas, but did not count the recurring costs of paper, ink/toner, and additional postage for the required initial or subsequent mailings of these notices.”

While these rights do not arise solely from regulation, HHS also proposes eliminating provisions that recognize the right of private individuals and entities to file lawsuits in federal court to challenge alleged violations of Section 1557. HHS also would eliminate the regulation that provides that money damages are available to compensate those injured by violations of Section 1557. In “no longer assert[ing] that a private right of action exists for parties to sue covered entities for any and all alleged violations of the proposed rule,” HHS effectively delegates to the courts whether an individual has a right to sue to enforce Section 1557.

Scope of Applicability

Covered Entities Receiving Federal Financial Assistance

HHS proposes narrowing the scope of the regulations to cover only the specific programs and activities that receive federal funding, and not all operations, of health insurers that are not principally engaged in the business of providing health care. The existing rule applies Section 1557’s non-discrimination protections broadly to health programs and activities, defining them to include all operations of an entity receiving federal financial assistance that is principally engaged in the provision or administration of health-related services or health-related insurance coverage. For example, under the current regulation, all health plans offered by an issuer that participates in a Marketplace are subject to Section 1557. Under the proposed change, if this issuer is not principally engaged in the business of providing health care (as opposed to health insurance), only its Marketplace plans would be covered and any plans it offers outside the Marketplace would not be subject to Section 1557. The proposed change also means that the regulations “would generally not apply to short term limited duration insurance.” In support of the proposed change, HHS states that the “‘business of providing . . . health care’ differs substantially from the business of providing health insurance coverage (or other health coverage) for such health care.” The end result is to reduce the number and type of entities required to comply with Section 1557’s non-discrimination protections.

HHS programs and activities

HHS also would apply the regulations only to health programs and activities that it administers under ACA Title I (Marketplaces), instead of all HHS-administered programs and activities. Health programs and activities conducted by HHS outside ACA Title I include other CMS programs and activities, the Health Services Research Administration (such as clinics operated by the National Health Service Corps), the Centers for Disease Control, the Indian Health Services (including IHS tribal hospitals), and the Substance Abuse and Mental Health Services Administration. Under the proposed change, these HHS programs would not be subject to the Section 1557 regulations.

discrimination based on association

HHS proposes eliminating the prohibition against discrimination based on an individual’s association or relationship with someone else based on that other person’s race, color, national origin, sex, age, or disability. These grounds for discrimination are recognized by the current Section 1557 regulations. Examples of discrimination based on association that would no longer be recognized by the proposed regulations include a doctor refusing to see a white patient because the patient has a biracial child or a health plan issuer excluding a provider from its network because the provider’s patients are primarily LEP individuals. A hearing parent who is required by a hospital to interpret for her deaf child would no longer be able to pursue a discrimination claim based on association under the Section 1557 regulations.

Disability Discrimination

HHS does not propose specific changes to Section 1557’s regulations prohibiting discrimination based on disability, but it does request public comment on whether some of these provisions should be changed. Specifically, HHS seeks comment on whether entities with less than 15 employees should be exempt from the requirement to provide auxiliary aids and services to ensure effective communication with people with disabilities; whether all covered entities should be subject to the architectural standards applicable to public buildings, especially with regard to multi-story building elevator and TTY requirements; and whether the provision requiring covered entities to make reasonable modifications in policies, practices, and procedures to avoid disability-based discrimination should be revised to include an exemption for undue hardship, in addition to the existing exemption when doing so would fundamentally alter the nature of the program or activity. These changes would restrict the current provisions that prohibit disability-based discrimination and ensure equal access.

Proposed Changes to Regulations Beyond Section 1557: Gender Identity and Sexual Orientation

Beyond the Section 1557 regulations, HHS also proposes eliminating explicit nondiscrimination protections related to gender identity and sexual orientation in 10 other existing regulations. HHS characterizes these changes as “limited conforming amendments.” These regulations include those that govern Medicaid managed care entities, state Medicaid programs, PACE organizations, group and individual health insurance issuers, Marketplaces, qualified health plan issuers, agents and brokers that assist with Marketplace applications and enrollment, and education programs that receive federal financial assistance. Currently, these other regulations, some of which have been in place for several years, provide protections against discrimination based on sexual orientation and gender identity. Without these prohibitions, a health plan issuer could inquire about an applicant’s sexual orientation and use sexual orientation for the purposes of underwriting or determining insurability. Issuers also could charge higher premiums or other fees or cancel or deny coverage for those who are LGBTQ. Medicaid managed care entities could discriminate against LGBTQ beneficiaries in enrollment, and PACE organizations could refuse to serve someone based on their sexual orientation.

Looking Ahead

In addition to the proposed changes, HHS seeks public comment on all provisions in the current Section 1557 regulations, including those that it proposes to retain, repeal, amend, or add. It also asks for public comment on whether any provisions from its proposed Section 1557 changes should be incorporated into regulations implementing the underlying civil rights laws, such as Title VI, Title IX, and Section 504. As a result, if finalized, any changes to the Section 1557 regulations could be a first step toward restricting nondiscrimination protections in other civil rights regulations. However, any changes in the federal regulations would not prohibit states from outlawing discrimination in state law on the basis of gender identity, sexual orientation, or other grounds beyond those recognized under federal law, as several states already have done. With the publication of its proposed changes, HHS has suspended all sub-regulatory guidance, such as Frequently Asked Questions and sample notices and nondiscrimination statements, that it considers to be inconsistent with the proposed changes.

HHS’s proposed changes would substantially narrow, and in many cases entirely eliminate, the regulations’ existing protections against discrimination in meaningful ways. Section 1557 sought to standardize the protections and processes that prohibit discrimination in health care for all protected populations. Section 1557 also recognizes intersectional discrimination that affects people who belong to multiple protected classes; for example, discrimination against an African-American woman could be discrimination on the basis of both race and sex. While HHS maintains that it “is committed to ensuring the civil rights of all individuals who access or seek to access health programs or activities of covered entities,” the proposed changes, if finalized, would substantially scale back the non-discrimination protections in existing regulations. Because this is a notice of proposed rule-making, HHS must review and consider public comments that are submitted prior to finalizing the regulations.

HHS’s proposed changes, while reshaping the regulatory protections, would not change the underlying statutory protections of Section 1557 as enacted by Congress. Some federal courts have recognized claims of discrimination and awarded relief under Section 1557 based on the statute itself and may continue to do so, regardless of regulatory changes. The HHS Office for Civil Rights’ enforcement of Section 1557 would be substantially narrowed under the proposed regulations, if finalized, in terms of the scope of covered entities and the type of claims constituting prohibited discrimination. However, federal courts could continue to apply Section 1557’s statutory protections more broadly and provide relief to individuals experiencing discrimination in the health care context.


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HHS’s Proposed Changes to Non-Discrimination Regulations Under ACA Section 1557