Proposed Rules on Nondiscrimination Released

John GarnerCompliance, Legislative Updates, Resources

The Department of Health and Human Services (HHS) has issued a proposed rule, Nondiscrimination in Health Programs and Activities, to assist some vulnerable populations.  This proposed rule should not be confused with the pending IRS rules on non-discrimination in health plans.

This rule clarifies the standards HHS would apply in implementing health care reform standards prohibiting discrimination in health programs.  The rule specifically protects individuals from being excluded from participating, denied benefits, and discrimination on the basis of race, color, national origin, sex, age, or disability.  This is the first proposed rule addressing this subject.  Overall, it ensures consumers have the equal access to health care and health coverage provided by the Affordable Care Act (ACA).

The rule would apply to any program or activity that is administered by any Federal government agency or any entity established under Title I of the ACA.  This includes federally facilitated and state-based marketplaces, nearly 200 health insurers participating in the marketplaces, Medicaid and CHIP programs, state public health agencies, 1,200 community health centers, nearly half a million clinical labs, and virtually every hospital, nursing home, home health agency, and related facility.  Close to a million physicians are also covered by the rule; however, those who only participate in Medicare Part B are not included.

Insurers are impacted by offering marketplace coverage and receiving premium tax credits or cost-sharing reduction payments.  Insurers cannot discriminate in the marketplace, individual market, off-marketplace, group market, or as third-party administrators for self-funded groups.  The proposed rule bars insurers from denying, cancelling, limiting, or refusing to insure or renew health coverage based on the protected status.  However, the rule does not address whether insurers can impose higher cost-sharing or limit access to treatments, such as AIDS patients or those with other high-cost conditions.

The rule does not cover religious-based discrimination.  However, it does cover discrimination based on gender identity.  This includes it as a form of sex discrimination, which also covers items such as pregnancy, false pregnancy, pregnancy termination, childbirth, and sex stereotyping.  Any entity with 15 or more employees that is impacted by this rule will be required to designate an employee responsible for compliance with the provision under the proposed rule.  While no training is required for this position, the Administration estimates that 7.6 million employees will be trained, at a cost of roughly $400 million.

HHS seeks comment on a variety of issues to better understand individuals’ experiences with health care discrimination and covered entities’ experiences in complying with Federal civil rights laws.  HHS requests comments on whether to include sexual orientation as a protected class, which the Equal Employment Opportunity Commission recently included as a form of sex discrimination.

The public has until November 6, 2015 to provide comments on the proposed rule.

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