Today HHS published its Final Rule for ACA Section 1557 in the Federal Register. A summary of the Final Rule and fact sheets on specific provisions are available here. The Final Rule contains some important new changes from the Proposed Rule which was published last Fall. We will issue a more comprehensive client alert shortly. But some of the more notable provisions in the Final Rule and preamble include:

  • Covered entities/TPAs:  HHS has refused to revise its conclusion that Section 1557 applies to all operations of health entities if any part received Federal financial assistance, including health providers, insurers and TPAs.  However, the mere fact that 1557 applies to a TPA does not mean that it applies to the employer plans the TPA serves.  OCR will only apply 1557 to a TPA to the degree that its own acts were discriminatory, not if it merely administered discriminatory plan terms.  However, OCR may refer cases involving discriminatory plan terms to the EEOC.
  • New single-sex program rule:  Covered entities will be permitted to operate single-sex programs , but only if they can demonstrate an “exceedingly persuasive justification”—that the sex-specific program is substantially related to the achievement of an important health-related or scientific objective.”
  • New religious exemption:  A new regulation provides that if application of the rules would violate Federal statutory protections for religious freedom, then application of the rules is not required.
  • LEP requirements:  The Final Rules continue to adopt the “reasonable steps” approach to LEP compliance.  In a change, taglines regarding LEP services now must be published in the top 15 languages for the State(s) served by the covered entity in significant publications and websites, or the top 2 languages in small publications like postcards.

The effective date of the rules is July 18, 2016. Covered entities will be required to comply with the notice and tagline requirements on October 16, 2016. Regulations regarding plan terms will take effect for plan years beginning on or after January 1, 2017.