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ACA Nondiscrimination Casts Wide Net, But Portion Has Been Enjoined

ACA Nondiscrimination Casts Wide Net, But Portion Has Been Enjoined

The Department of Health and Human Services (HHS) released final regulations on Section 1557 of the Affordable Care Act (ACA) in May 2016. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability by any entity that operates a health program or activity, any part of which receives federal financial assistance. This includes entities which provide, administer, or assist in obtaining health-related services or health-related insurance coverage.

Since other federal law generally prohibits discrimination for many of the same reasons, the major impact of these regulations is to prohibit discrimination related to gender identity and termination of pregnancy. It is these aspects of the regulation that were challenged on the basis they violate the Religious Freedom Restoration Act and thwart the independent medical judgment of physicians. A Texas federal court agreed and issued a nationwide injunction on December 31, 2016, as further described at the end of this article. As noted by the Texas court, only the prohibition of discrimination on the basis of “gender identity” and “termination of pregnancy” is enjoined. Employers covered by these regulations are still required to comply with the remaining requirements of these regulations, including the notice requirements detailed below.

The regulations will apply to almost any entity in the health care industry (such as hospitals, health clinics, health insurers, community health centers, physician practices, home health care agencies, pharmacies, etc.), almost all insurers (including those which administer self-insured group health plans), and any group health plan that receives, or whose sponsor receives, federal financial assistance. These entities are referred to as “covered entities” in the regulations.

“Federal financial assistance” includes any grant, loan, credit, subsidy, contract, or other arrangement where the federal government provides funds, services of federal personnel, or real or personal property, including payments from Medicare (including Medicare Part D subsidies), Medicaid, and the State Children’s Health Insurance Program (SCHIP).

Click here to read this article in its entirety.

For more information, please contact Michael Bindner, Carl Lammers or any other attorney in Frost Brow Todd’s Employee Benefits Law practice.

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J. Christopher Coffman is a member of FBT focused on civil and criminal tax controversies. He has experience representing clients subject to IRS audits and federal criminal investigations before local and state taxing authorities and the U.S. Tax Court.

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