Nondiscrimination in Health and Health Education Programs or Activities
| Published date | 14 June 2019 |
| Citation | 84 FR 27846 |
| Record Number | 2019-11512 |
| Section | Proposed rules |
| Court | Centers For Medicare And Medicaid Services |
Federal Register, Volume 84 Issue 115 (Friday, June 14, 2019)
[Federal Register Volume 84, Number 115 (Friday, June 14, 2019)]
[Proposed Rules]
[Pages 27846-27895]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-11512]
[[Page 27845]]
Vol. 84
Friday,
No. 115
June 14, 2019
Part II Department of Health and Human Services-----------------------------------------------------------------------Centers for Medicare and Medicaid Services-----------------------------------------------------------------------42 CFR Parts 438, 440 and 460
45 CFR Parts 86, 92, 147, et al.Nondiscrimination in Health and Health Education Programs or
Activities; Proposed Rule
Federal Register / Vol. 84 , No. 115 / Friday, June 14, 2019 /
Proposed Rules
[[Page 27846]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare and Medicaid Services
42 CFR Parts 438, 440, and 460
Office of the Secretary
45 CFR Parts 86, 92, 147, 155, and 156
[Docket No.: HHS-OCR-2019-0007]
RIN 0945-AA11
Nondiscrimination in Health and Health Education Programs or
Activities
AGENCY: Centers for Medicare and Medicaid; Office for Civil Rights
(OCR), Office of the Secretary, HHS.
ACTION: Proposed rule.
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SUMMARY: The Department of Health and Human Services (``the
Department'') is committed to ensuring the civil rights of all
individuals who access or seek to access health programs or activities
of covered entities under Section 1557 of the Patient Protection and
Affordable Care Act. The Department proposes to revise its Section 1557
regulation in order to better comply with the mandates of Congress,
address legal concerns, relieve billions of dollars in undue regulatory
burdens, further substantive compliance, reduce confusion, and clarify
the scope of Section 1557 in keeping with pre-existing civil rights
statutes and regulations prohibiting discrimination on the basis of
race, color, national origin, sex, age, and disability.
DATES: Submit comments on or before August 13, 2019.
ADDRESSES: You may submit comments to this proposed rule, identified by
RIN 0945-AA11, by any of the following methods:
Federal eRulemaking Portal: You may submit electronic
comments at http://www.regulations.gov by searching for the Docket ID
number HHS-OCR-2019-0007. Follow the instructions at http://www.regulations.gov online for submitting comments through this method.
Regular, Express, or Overnight Mail: You may mail comments
to U.S. Department of Health and Human Services, Office for Civil
Rights, Attention: Section 1557 NPRM, RIN 0945-AA11, Hubert H. Humphrey
Building, Room 509F, 200 Independence Avenue SW, Washington, DC 20201.
Hand Delivery/Courier: You may hand deliver comments to
the U.S. Department of Health and Human Services, Office for Civil
Rights, Attention: Section 1557 NPRM, RIN 0945-AA11, Hubert H. Humphrey
Building, Room 509F, 200 Independence Avenue SW, Washington, DC 20201.
All comments received by the methods and due date specified above
will be posted without change to http://www.regulations.gov, including
any personal information provided, and such posting may occur before or
after the closing of the comment period.
We will consider all comments received by the date and time
specified in the DATES section above, but, because of the large number
of public comments we normally receive on Federal Register documents,
we are not able to provide individual acknowledgements of receipt.
Please allow sufficient time for mailed comments to be timely
received in the event of delivery or security delays. Because access to
the interior of the Hubert H. Humphrey Building is not readily
available to persons without Federal government identification,
commenters are encouraged to leave their comments in the mail drop
slots located in the lobby of the building. Electronic comments with
attachments should be in Microsoft Word or Excel; however, we prefer
Microsoft Word.
Please note that comments submitted by fax or email and those
submitted after the comment period will not be accepted.
Docket: For complete access to background documents or posted
comments, go to http://www.regulations.gov and search for Docket ID
number HHS-OCR-2019-0007.
FOR FURTHER INFORMATION CONTACT: Luben Montoya, Supervisory Civil
Rights Analyst, HHS Office for Civil Rights at (800) 368-1019 or (800)
537-7697 (TDD).
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary
A. Background on Section 1557 and Its Rulemaking
B. Litigation Challenging the Section 1557 Regulation
C. Summary of the Proposed Rule
D. Cost-Effective Design of the Proposed Rule
II. Reasons for the Proposed Rulemaking
A. Section 1557 of the PPACA Does Not Prevent or Limit
Reconsideration of the Current Rule
B. The Final Rule Adopted Novel and Inconsistent Legal
Interpretations of Long-Standing Civil Rights Law
1. The Final Rule Interpreted the Scope of Section 1557 Too
Broadly
2. The Final Rule Improperly Blended Substantive Requirements
and Enforcement Mechanisms of the Underlying Statutes
3. The Final Rule Inconsistently Applied Federal
Nondiscrimination Law
4. The Final Rule Created New Provisions Concerning Language
Access Requirements Not Adequately Justified by Law or Policy
5. The Final Rule's Definition of Discrimination ``On the Basis
of Sex'' Has Been Enjoined by Federal Courts
a. Background on Title IX of the Education Amendments
b. HHS's Title IX Regulations
c. Need for Consistency Among Components of HHS
d. Pending Federal Litigation Over Section 1557 Regulation,
Title IX, and Title VII
e. HHS's Inconsistency With Other Federal Departments
f. Need for Consistency With the Department of Justice on
Implementation and Enforcement of Nondiscrimination Laws
g. Clarity and Sensitive Balancing of Competing Interests at the
Local Level
C. The Costs of the Final Rule Were Unnecessary and Unjustified
1. The Section 1557 Regulation Imposed Substantially Higher
Regulatory Costs Than Predicted
2. The Section 1557 Regulation's Burdens Are Not Justified by
Need
III. Nondiscrimination in Health Programs and Activities
Provisions of the Proposed Section 1557 Rule at 45 CFR part 92
Proposed ``Subpart A--General Provisions''
Proposed ``45 CFR 92.1 Purpose.''
Proposed ``45 CFR 92.2 Nondiscrimination requirements.''
Proposed ``45 CFR 92.3 Scope of application.''
Proposed ``45 CFR 92.4 Assurances.''
Proposed ``45 CFR 92.5 Enforcement mechanisms.''
Proposed ``45 CFR 92.6 Relationship to other laws.''
Proposed ``Subpart B--Specific Application to Health Programs or
Activities''
Proposed ``45 CFR 92.101 Meaningful access for individuals with
limited English proficiency.''
Proposed ``45 CFR 92.102 Effective communication for individuals
with disabilities.''
Proposed ``45 CFR 92.103 Accessibility standards for buildings
and facilities.''
Proposed ``45 CFR 92.104 Accessibility of information and
communication technology.''
Proposed ``45 CFR 92.105 Requirement to make reasonable
modifications.''
Request for Comments on Proposed 45 CFR 92.102 Through 92.105
B. Current Section 1557 Regulation Provisions Proposed for
Repeal or Reconsideration
1. Taglines, Notices, Language Access Plans, and Video
Interpretation Standards
2. Redundant Provisions Duplicative of Pre-Existing Regulations
[[Page 27847]]
IV. Need for Conforming Amendments
A. Nondiscrimination in Education Programs or Activities
Proposed ``45 CFR 86.18 Amendments to conform to statutory
exemptions.''
B. Proposed Conforming Amendments
C. Technical Amendments
V. Interim Treatment of Subregulatory Guidance
VI. Regulatory Impact Analysis
A. Executive Orders 12866 and Related Executive Orders on
Regulatory Review
1. Summary of the Proposed Rule
2. Need for the Proposed Rule
3. Consideration of Regulatory Alternatives
4. Considerations for Cost-Effective Design
5. Methodology for Cost-Benefit Analysis
6. Cost-Benefit Analysis
a. Overview
b. Generally Applicable Tangible and Intangible Benefits and
Burdens
c. Baseline Assumptions
d. Covered Entities
(1) Entities Covered by Section 1557
(a) Entities With a Health Program or Activity, Any Part of
Which Receives Federal Financial Assistance From the Department
(b) Programs or Activities Administered by the Department Under
Title I of the PPACA
(c) Entities Established Under Title I of PPACA
(2) Entities Covered by Title IX
e. Cost Savings From Eliminating Notice and Taglines Requirement
f. Cost Arising From Removal of Notice and Taglines Requirement
g. Cost Savings From Changes to Language Access Plan Provisions
h. Cost Savings Attributed to Covered Entities' Handling of
Certain Grievances
i. Additional Costs for Training and Familiarization Under the
Proposed Rule
(1) Number of Covered Entities That May Train Workers
(2) Number of Individuals Who Will Receive Training
(3) Total Cost of Training
j. Additional Costs for Revising Policies and Procedures
k. Other Costs Due to Reversion to Previous Practices
l. Other Benefits or Costs
7. Impact on State, Local, and Tribal Entities Under Executive
Orders 12866, 13132, and 13175
a. State and Local Governments
b. Tribal Governments
8. Avoidance of Inconsistent, Incompatible, or Duplicative
Regulations
B. Executive Order 13771 on Reducing and Controlling Regulatory
Costs
C. Congressional Review Act
D. Unfunded Mandates Reform Act
E. Regulatory Flexibility Act and Executive Order 13272 on
Proper Consideration of Small Entities in Agency Rulemaking
F. Executive Order 12250 on Leadership and Coordination of
Nondiscrimination Laws
G. Paperwork Reduction Act
VII. Effective Date
VIII. Delegation of Authority
IX. Request for Comment
I. Executive Summary
A. Background on Section 1557 and Its Rulemaking
Section 1557 of the Patient Protection and Affordable Care Act
(``PPACA'') \1\ prohibits discrimination on the basis of race, color,
national origin, sex, age, or disability under any health program or
activity that receives Federal financial assistance, or under any
program or activity that is administered by an executive agency under
Title I of the PPACA or by an entity established under such Title.
Section 1557 cites Title VI of the Civil Rights Act of 1964 (42 U.S.C.
2000d et seq.) (``Title VI''), Title IX of the Education Amendments of
1972 (20 U.S.C. 1681 et seq.) (``Title IX''), the Age Discrimination
Act of 1975 (42 U.S.C. 6101 et seq.) (``Age Act''), and Section 504 of
the Rehabilitation Act of 1973 (29 U.S.C. 794) (``Section 504'').\2\ It
further states that ``[t]he enforcement mechanisms provided for and
available'' under those laws ``shall apply for purposes of violations''
of Section 1557.\3\
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\1\ Patient Protection and Affordable Care Act, Public Law 111-
148, sec. 1557, 124 Stat. 119, 260 (Mar. 23, 2010) (codified at 42
U.S.C. 18116). In this Notice of Proposed Rulemaking, we refer
interchangeably to Section 1557 and 42 U.S.C. 18116.
\2\ While Section 1557 does not incorporate nondiscrimination
provisions by reference to Title VII, it provides that nothing in
Title I of the PPACA is to be construed as invalidating or limiting
the rights, remedies, procedures, or legal standards available under
certain civil rights laws, and mentions Title VII specifically. 42
U.S.C. 18116(b).
\3\ 42 U.S.C. 18116(a).
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Section 1557 authorizes, but does not require, the Secretary of
Health and Human Services (``Secretary'') to promulgate regulations
implementing Section 1557's nondiscrimination requirements.\4\
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\4\ 42 U.S.C. 18116(c).
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On August 1, 2013, the Department issued a Request for Information
(RFI) soliciting input on regulations under Section 1557. 78 FR 46558.
Thereafter, on September 8, 2015, the Department issued a Notice of
Proposed Rulemaking (NPRM) to add a new part 92 to Title 45 of the Code
of Federal Regulations and thereby impose numerous new requirements on
covered entities.\5\ 80 FR 54172.
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\5\ See 45 CFR 92.4 (``Covered entity means: (1) An entity that
operates a health program or activity, any part of which receives
Federal financial assistance; (2) An entity established under Title
I of the PPACA that administers a health program or activity; and
(3) The Department.'').
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On May 18, 2016, the Department finalized its proposed regulations
for Section 1557 in 45 CFR part 92 (the ``Final Rule,'' ``current
rule,'' or the ``Section 1557 Regulation''). 81 FR 31376.\6\ As noted
above, Section 1557 bars discrimination on grounds prohibited under
several civil rights statutes, including on the ground of sex under
Title IX of the Education Amendments of 1972. In its Section 1557
Regulation, the Department defined discrimination ``on the basis of
sex'' to cover, among other things, discrimination on the basis of sex
stereotyping, gender identity, and termination of pregnancy, but
explicitly declined to include discrimination on the basis of sexual
orientation. 81 FR 31390 (``OCR has decided not to resolve in this rule
whether discrimination on the basis of an individual's sexual
orientation status alone is a form of sex discrimination.''). As
explained more fully below, the Final Rule, among other things, imposed
specific requirements regarding language assistance services, multi-
language ``taglines,'' and nondiscrimination notices.
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\6\ The Final Rule was later revised on July 18, 2016, when the
Department issued a technical correction deleting an incorrect toll-
free telephone number to call the Department to file a civil rights
complaint. 81 FR 46613 (July 18, 2016).
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The Department estimated that, collectively, the Final Rule's new
requirements, backed by the threat of enforcement action, would cost
health care providers and other covered entities over $942.5 million in
the first five years of implementation. 81 FR 31459.
The Final Rule became effective on July 18, 2016, except to the
extent that the Rule required changes to health insurance or group
health plan benefits or benefit design, in which case the Final Rule
applied on the first day of the first plan year that began on or after
January 1, 2017. 45 CFR 92.1.
On January 20, 2017, the President issued E.O. 13765 ``Minimizing
the Economic Burden of the Patient Protection and Affordable Care Act
Pending Repeal,'' that requires, among other things, ``[t]o the maximum
extent permitted by law, the Secretary of Health and Human Services . .
. shall exercise all authority and discretion available to [ ] waive,
defer, grant exemptions from, or delay the implementation of any
provision or requirement of the [PPACA] that would impose a fiscal
burden on any State or a cost, fee, tax, penalty, or regulatory burden
on individuals, families, healthcare providers, health insurers,
patients, recipients of healthcare services, purchasers of health
insurance, or makers of medical devices, products, or medications.'' 82
FR 8351 (Jan. 24, 2017).
[[Page 27848]]
B. Litigation Challenging the Section 1557 Regulation
Lawsuits challenging the regulations followed promulgation of the
Final Rule. On August 23, 2016, the States of Texas, Wisconsin,
Nebraska, Kentucky, and Kansas, along with three private health care
providers, filed a complaint in the U.S. District Court for the
Northern District of Texas challenging the Section 1557 Regulation. See
Franciscan Alliance, Inc., et al. v. Burwell, et al., 227 F. Supp. 3d
660 (N.D. Tex. 2016). The complaint stated that, ``by redefining a
single word used in the Affordable Care Act . . . HHS has created a
massive new liability for thousands of healthcare professionals unless
they cast aside their medical judgment and perform controversial and
even harmful medical transition procedures.'' Complaint, Franciscan
Alliance, Inc., et al. v. Burwell, et al., No. 7:16-cv-00108-O (N.D.
Tex. Aug. 23, 2016). Two other cases with similar objections were filed
in the U.S. District Court for the District of North Dakota. Religious
Sisters of Mercy, et al. v. Burwell, et al., No. 3:16-cv-386 (D.N.D.
filed Nov. 7, 2016); Catholic Benefits Association, et al. v. Burwell,
et al., No. 3:16-cv-432 (D.N.D. filed Dec. 28, 2016).\7\
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\7\ Religious Sisters of Mercy, et al. v. Burwell, et al., No.
3:16-cv-386; Catholic Benefits Association et al., v. Burwell, et
al., No. 3:16-cv-432 (D.N.D. order of Jan. 23, 2017, consolidating
North Dakota cases).
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On December 31, 2016, the U.S. District Court in Franciscan
Alliance issued a nationwide preliminary injunction against the
Department, barring it from enforcing the Section 1557 Regulation's
prohibition against discrimination on the basis of ``gender identity''
and ``termination of pregnancy.'' 227 F. Supp. 3d at 696. The district
court held that the Department had adopted an erroneous interpretation
of ``sex'' under Title IX, and that the regulation was also arbitrary
and capricious for failing to incorporate Title IX's religious and
abortion exemptions. Id. The district court concluded that the
Department's interpretation was not entitled to deference under Chevron
U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837
(1984), because ``the meaning of sex in Title IX unambiguously refers
to the biological and anatomical differences between male and female
students as determined at their birth.'' 227 F. Supp. 3d at 687
(citations omitted).
The Franciscan Alliance district court also held that plaintiffs
had established a likelihood of success on the merits of their claims
that the Department had violated the Administrative Procedure Act (APA)
and the Religious Freedom Restoration Act (RFRA). Id. at 693. Regarding
the RFRA claim, the district court found that HHS had not demonstrated
a compelling interest in enforcing the regulation against the
plaintiffs. Id. at 696. And even if the Department had demonstrated
that compelling interest, the court held that the Department failed to
show that its interest could not be pursued through less restrictive
means for providing access to, and coverage for, services related to
gender dysphoria. Id. at 693. The U.S. District Court for the District
of North Dakota found the Franciscan Alliance order to be ``thorough
and well-reasoned,'' and on that basis temporarily stayed enforcement
of Section 1557's prohibitions against discrimination on the bases of
gender identity and termination of pregnancy against the named
plaintiffs in that court's two consolidated cases.\8\
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\8\ Religious Sisters of Mercy, et al. v. Burwell, et al., Nos.
3:16-cv-386 & 3:16-cv-432 (D.N.D. Order of January 23, 2017).
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On July 10, 2017, the Franciscan Alliance court stayed proceedings
to allow time for agency reconsideration, finding that the preliminary
injunction order ``provides sufficient guidance for HHS's review of the
Rule.'' \9\ The U.S. District Court for the District of North Dakota
also further stayed the proceedings in its two cases on July 10, 2017
and on August 24, 2017.\10\ Neither the previous Administration nor the
current one appealed the nationwide preliminary injunction, or the
orders in Franciscan Alliance, Religious Sisters of Mercy, or Catholic
Benefits Association, staying proceedings. On May 2, 2017, the
Department of Justice (DOJ) moved the Northern District of Texas for a
voluntary remand and stay to allow HHS to ``reassess the
reasonableness, necessity, and efficacy of the two aspects of the
[Section 1557] regulation that are challenged'' in litigation.\11\ DOJ
filed a similar motion with the District of North Dakota later that
month.\12\
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\9\ Franciscan Alliance, No. 7:16-cv-00108-O (filed July 10,
2017).
\10\ Religious Sisters of Mercy, et al. v. North Dakota v.
Burwell, et al., No. 3:16-cv-386 (D.N.D. Order filed on July 10,
2017; Catholic Benefits Association v. Burwell, No. 3:16-cv-432
(D.N.D. Order filed Aug. 24, 2017).
\11\ See Defendant's Motion, Franciscan Alliance, No. 7:16-cv-
00108-O (filed May 2, 2017).
\12\ Defendant's Motion, Religious Sisters of Mercy, No. 3:16-
cv-386 (filed May 26, 2017).
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On July 10, 2017, the Franciscan Alliance court stayed proceedings
to allow time for agency reconsideration, finding that the court's
preliminary injunction order ``provides sufficient guidance for HHS's
review of the Rule.'' \13\ The district court in North Dakota similarly
stayed proceedings on August 24, 2017, in order to allow HHS ``to
reconsider the controversial rules and regulations at issue.'' \14\
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\13\ Franciscan Alliance, No. 7:16-cv-00108-O (filed July 10,
2017).
\14\ Religious Sisters of Mercy, No. 3:16-cv-432 (order of Aug.
24, 2017).
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On February 4, 2019, the plaintiffs in the Franciscan Alliance case
filed briefs in support of their renewed motions for summary judgment.
On April 5, 2019, DOJ filed a brief in response to plaintiffs' motion
summary judgment on behalf of HHS,\15\ stating that ``the relevant
provisions of Title IX and Section 1557 unambiguously exclude gender-
identity discrimination.'' Id. at 14. In this brief, DOJ stated the
position of the U.S. Government on the meaning of ``sex'' under Title
VII of the Civil Rights Act, Title IX of the Education Amendments of
1972, and Section 1557 of PPACA. DOJ stated, ``Since the [Section 1557
Final] Rule was issued, the United States has returned to its
longstanding position that the term `sex' in Title VII does not refer
to gender identity, and there is no reason why Section 1557, which
incorporates Title IX's analogous prohibition on `sex' discrimination,
should be treated differently.'' Id. at 6. Therefore, DOJ concluded,
``the [Final] Rule's prohibitions on discrimination on the basis of
gender identity and termination of pregnancy conflict with Section 1557
and thus are substantively unlawful under the APA.'' Id. DOJ continued,
``[t]he [Final] Rule also fails to incorporate Title IX's exemptions
despite Section 1557's directive to the contrary, thereby prohibiting
conduct the statute permits.'' Id.
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\15\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O (filed April 5, 2019).
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While it reconsiders its Section 1557 Regulation through the
rulemaking process, the Department continues to abide by the
preliminary injunction, which remains in place.
C. Summary of the Proposed Rule
In order to better comply with the mandates of Congress, address
legal concerns, relieve billions of dollars in undue regulatory
burdens, further substantive compliance, reduce confusion, and clarify
the scope of Section 1557, the Department proposes to make substantial
revisions to the Section 1557 Regulation and to eliminate provisions
that are inconsistent or redundant with pre-existing civil rights
statutes and
[[Page 27849]]
regulations prohibiting discrimination on the basis of race, color,
national origin, sex, age, and disability. In addition, to resolve
confusion raised by the Section 1557 Regulation's reliance on an
outdated version of the Department's Title IX regulation, the
Department proposes to amend its Title IX regulation to implement
statutory amendments made by Congress to Title IX in 1988.\16\
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\16\ See Civil Rights Restoration Act of 1987, Public Law 100-
259, 102 Stat. 28 (Mar. 22, 1988) (amending Title IX). These
proposed changes would better align HHS's regulations to the Title
IX regulations adopted by other agencies and the position of the
Department of Justice, the Federal civil rights coordinating
authority under Executive Order 12250. See Executive Order 12250 on
Leadership and Coordination of Nondiscrimination Laws, 45 FR 72995
(Nov. 2, 1980).
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The proposed rule would retain the obligation imposed on covered
entities to submit assurances of compliance, certain provisions
concerning language access for individuals with limited English
proficiency (LEP), and certain provisions ensuring access for
individuals with disabilities. The proposed rule would empower the
Department to continue its robust enforcement of civil rights laws
prohibiting discrimination on the basis of race, color, national
origin, sex, age, or disability in Department-funded health programs or
activities, and would make it clear that such civil rights laws remain
in full force and effect.
The Department further proposes to make limited conforming
amendments to ten provisions in relevant Department regulations.
D. Cost-Effective Design of the Proposed Rule
The proposed rule would be an economically significant deregulatory
action. The Department projects that the proposed rule would result in
approximately $3.6 billion in cost savings (undiscounted) over the
first five years after finalization. The Department anticipates that
the largest proportion of these estimated savings would result from
repealing the Section 1557 Regulation's provisions related to mandatory
notices. Specifically, the proposed rule would repeal requirements on
covered entities to mail beneficiaries, enrollees, and others, notices
concerning non-discrimination and the availability of language
assistance services (in 15 languages) with every ``significant''
publication and communication larger than a postcard or brochure. The
Department projects additional savings from eliminating the requirement
for OCR to weigh the presence or absence of language access plans, and
from repealing provisions that duplicate disability and sex
discrimination regulatory requirements concerning covered entities
establishing grievance procedures. The Department estimates that there
will be some additional costs to covered entities regarding training
and revision of policies and procedures if the proposed regulation is
finalized.
The Department believes that the anticipated benefits--which
include compliance with Federal law, appropriate respect for the roles
of Federal courts and Congress, and reduction or elimination of
ineffective, unnecessary, or confusing provisions--far outweigh any
costs or burdens that may arise from the proposed changes.
II. Reasons for the Proposed Rulemaking
Section 1557 does not require any implementing regulations, but
incorporates and builds on the existing civil rights framework of Title
VI, Title IX, Age Act, and Section 504 by making the nondiscrimination
requirements of such laws applicable to certain health programs or
activities and related entities to the extent they do not already apply
to such programs or activities. With this background in mind, the
Department has decided to substantially revise the Section 1557
Regulation for several reasons.
The Department believes that the Final Rule exceeded its authority
under Section 1557, adopted erroneous and inconsistent interpretations
of civil rights law, caused confusion, and imposed unjustified and
unnecessary costs. As stated in the Franciscan Alliance litigation,
``the Rule's prohibitions of discrimination on the basis of gender
identity and, without the accompanying statutory protections,
termination of pregnancy are substantively unlawful under the APA.''
\17\ The existence of lawsuits and court orders blocking enforcement of
significant parts of the Final Rule for over two years indicates that
changes in the proposed rule may minimize litigation risk.
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\17\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O at *5 (filed April 5, 2019).
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For all these reasons, the Department proposes to exercise its
discretionary regulatory authority to revise the Section 1557
Regulation to implement Federal civil rights law consistent with the
applicable statutes as passed by Congress. The Department believes
these amendments would reduce the significant confusion and unjustified
burdens caused by the Final Rule.
First, the Final Rule created inconsistencies with, and
unnecessarily duplicated, the Department's long-standing existing civil
rights regulations. See 45 CFR parts 80 and 81 (Title VI), 84 and 85
(Section 504), 86 (Title IX), 90 and 91 (Age Act). Therefore, the
Department proposes to repeal the provisions of the Final Rule that are
confusing and redundant.
Second, the U.S. District Court for the Northern District of Texas
preliminarily enjoined enforcement of parts of the Section 1557
Regulation because it found that the Department had exceeded its
statutory authority.\18\ The Department proposes this rule to address
the overbroad interpretations, adopted in the current rule, of Section
1557 that were identified by the court and other Federal precedents.
The Department also proposes to address the court's findings by
incorporating, into the Department's implementing regulations, certain
amendments to the statutes expressly identified by Congress in Section
1557.
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\18\ See Franciscan Alliance, 227 F. Supp. 3d at 696.
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Third, the Department estimates that the prior rulemaking did not
anticipate or account for an annual burden of approximately $147
million (low-end) to $1.34 billion dollars (high-end), as further
described in the Regulatory Impact Analysis of this proposed rule. The
Department does not believe those burdens are justified by need, or by
the benefits obtained by the rulemaking. In total, the proposed rule
would relieve the American people of approximately $3.6 billion in
unjustified costs over five years, while continuing to provide for
vigorous enforcement of civil rights protections in health care. See
Executive Order 13765, 82 FR 8351 (Jan. 20, 2017) (``Minimizing the
Economic Burden of the Patient Protection and Affordable Care Act
Pending Repeal'').
As discussed below, the Department believes the repeal and
replacement of significant portions of the Section 1557 Regulation
would provide much needed finality, predictability, administrability,
consistency, relief of burdens, and clarity, all of which would benefit
covered entities, beneficiaries of Exchanges, and Department-funded or
administered health programs or activities, the courts, and the general
public.
In light of these determinations, through this proposed rule, the
Department proposes to codify the longstanding application of the civil
rights laws cited in Section 1557 to health programs or activities
receiving Federal financial assistance or programs
[[Page 27850]]
or activities administered by the Department under Title I of the PPACA
or by entities established under such Title, both in terms of the
protections those civil rights laws provide and the enforcement
mechanisms they entail. This approach faithfully implements the
Congressional mandate and seeks to avoid further litigation and
uncertainty regarding the implementing regulations. The Department
seeks comment on all of the provisions that are retained under this
proposed rule, or that this rule proposes to repeal, amend, or add,
including comment on whether provisions of the current Section 1557
Regulation that the Department does not propose to retain in this
proposed rule, if any, are in keeping with Congress's mandate such that
the Department should consider retaining them--and whether any of such
provisions should be incorporated into the Department's regulations
implementing the underlying civil rights laws.
A. Section 1557 of the PPACA Does Not Prevent or Limit Reconsideration
of the Current Rule
Section 1557(c) states that the Secretary ``may'' promulgate
implementing regulations. This language contrasts with the multiple
other areas of Title I of the PPACA where Congress directed that the
Secretary (or Secretaries) ``shall'' issue regulations. 42 U.S.C.
18116(c). Section 1557 accordingly authorizes, but does not require,
the Secretary to implement the statute through regulation. That
approach makes sense because ``Section 1557 builds on a landscape of
existing civil rights laws.'' 78 FR 46559 (RFI) (Aug. 1, 2013). Section
1557 vests the Department with discretion to determine whether and to
what degree implementing regulations are needed, and to revisit that
determination, as appropriate, at a later date. Encino Motorcars v.
Navarro, 146 S.Ct. 2117, 2125 (2016) (``Agencies are free to change
their existing policies as long as they provide a reasoned explanation
for the change''). (ConocoPhillips Co. v. U.S. E.P.A., 612 F.3d 822,
832 (5th Cir. 2010) (``[e]mbedded in an agency's power to make a
decision is its power to reconsider that decision.''); New England
Power Generators Assn. v. FERC, 879 F.3d 1192 (D.C. Cir. 2018) (``So
long as any change is reasonably explained, it is not arbitrary and
capricious for an agency to change its mind in light of experience, or
in the face of new or additional evidence, or further analysis or other
factors indicating that the agency's earlier decision should be altered
or abandoned.''). Thus, an agency action to substantially repeal a
prior rule, or parts thereof, is not necessarily subject to a higher
standard of justification in the exercise of such discretion compared
to the level of justification required under the prior rulemaking on a
blank slate. See FCC v. Fox Television Stations, Inc., 556 U.S. 502,
515 (2009) (``When an agency changes its existing position, it need not
always provide a more detailed justification than what would suffice
for a new policy created on a blank slate. But the agency must at least
display awareness that it is changing position and show that there are
good reasons for the new policy.''). The agency's use of its rulemaking
discretion in revisiting its original position is not, therefore,
subject to a higher standard under the APA (5 U.S.C. 706); otherwise,
agencies would be limited in their ability to revisit past regulations
to cure defects or provide clarifications.
B. The Final Rule Adopted Novel and Inconsistent Legal Interpretations
of Long-Standing Civil Rights Law
1. The Final Rule Interpreted the Scope of Section 1557 Too Broadly
The Department has now concluded that its existing Section 1557
Regulation impermissibly extends to programs and entities not covered
by the text of the statute. With respect to the receipt of Federal
financial assistance, the current rule defines ``health program or
activity'' to cover ``all [ ] operations'' of entities principally
engaged in providing or administering ``health services or health
insurance coverage or other health coverage.'' 45 CFR 92.4. The scope
of the regulation then includes all the operations of entities that
provide ``health insurance coverage or other health coverage,'' whether
or not they provide any health care.
The Civil Rights Restoration Act of 1987 (CRRA), however, defined
``program or activity'' for purposes of Title VI, Section 504 of the
Rehabilitation Act, the Age Act, and Title IX to cover all operations
of regulated entities only when they are ``principally engaged in the
business of providing education, health care, housing, social services,
or parks and recreation.'' Public Law 100-259, 102 Stat. 28 (Mar. 22,
1988) (emphasis added). The ``business of providing . . . health care''
differs substantially from the business of providing health insurance
coverage (or other health coverage) for such health care. Thus, the
Final Rule goes beyond the CRRA by covering all the operations of
entities that provide ``health insurance coverage or other health
coverage'' and extends to those that are not principally engaged in the
business of providing health care, and to those who provide no health
care at all.\19\ Moreover, the Department had not previously
interpreted the CRRA to cover all the operations of health insurance
providers under any of the antidiscrimination laws covered by the CRRA
(Title VI, Title IX, the Age Act, and Section 504) until it promulgated
the Section 1557 regulation--over a quarter century after the CRRA was
passed--despite there being nothing in Section 1557 indicating any
abrogation--or expansion--of the CRRA. Therefore, the Department is now
proposing to clarify that health insurance programs administered by
entities not principally engaged in providing health care will only be
covered by the Rule to the extent those programs (as opposed those
entities) receive Federal financial assistance from the Department.
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\19\ The preamble to the Final Rule acknowledges the relevance
of the CRRA, 81 FR at 31386, but does not explain how the provision
of ``health care'' covers the provision of ``health insurance, even
if only part of the health program or activity receives such
assistance.''
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2. The Final Rule Improperly Blended Substantive Requirements and
Enforcement Mechanisms of the Underlying Statutes
The PPACA states that the ``enforcement mechanisms for and
available under [ ] title VI, title IX, section 504, or such Age
Discrimination Act shall apply,'' for purposes of enforcing Section
1557. 42 U.S.C. 18116(a). Interpreting this provision in 2015, a
Federal court held ``Congress's express incorporation of the
enforcement mechanisms from those four Federal civil rights statutes,
as well as its decision to define the protected classes by reference
thereto, manifests an intent to import the various different standards
and burdens of proof into a Section 1557 claim, depending upon the
protected class at issue.'' Southeastern Pennsylvania v. Gilead, 102 F.
Supp. 3d 688, 698-99 (E.D. Pa. 2015) (emphasis added). See also Briscoe
v. Health Care Serv. Corp., 281 F. Supp. 3d 725, 738 (N.D. Ill. 2017)
(``If Congress intended for a single standard to apply to all Sec.
1557 discrimination claims, repeating the references to the civil-
rights statutes and expressly incorporating their distinct enforcement
mechanisms would have been a pointless (and confusing) exercise.'').
In interpreting and enforcing Section 1557 prior to the
promulgation of the Final Rule--i.e., from 2010 to 2016--the Department
applied Title VI, Title IX, Section 504, and the Age Act regulations as
independent authorities.
[[Page 27851]]
However, contrary to the text of Section 1557, the Final Rule did not
merely take existing protected classes and enforcement mechanism and
apply them to health care programs or activities. Rather, it made
certain individualized requirements, prohibitions, or enforcement
mechanisms apply across all protected classes without sufficient
statutory or regulatory support. This hodgepodge approach at times
resulted in conflicts with precedents of the U.S. Supreme Court and
lower Federal courts. See 81 FR 31387 (stating in the preamble of the
Final Rule that there is ``a cognizable national origin discrimination
claim under Title VI, Section 1557, and this part when the claim
alleges that a covered entity's use of a facially neutral policy or
practice related to citizenship or immigration status has a disparate
impact on individuals of a particular national origin group''); see
also 81 FR at 31440 (``OCR interprets Section 1557 as authorizing a
private right of action for claims of disparate impact discrimination
on the basis of any of the criteria enumerated in the legislation'');
81 FR 31405 (``OCR recognizes that discrimination based on health
status, claims experience, medical history, or genetic information can,
depending on the facts, have a disparate impact that results in
discrimination on a basis prohibited by Section 1557 and will process
complaints alleging such discrimination accordingly''). But see
Alexander v. Sandoval, 532 U.S. 275, 282 (2001) (denying private rights
of action for disparate impact theories under Title VI).
The Final Rule stated that an individual or entity may bring a
civil action to challenge a violation of Section 1557 or of the
regulation in Federal court. 45 CFR 92.302(d). The Department explained
in the preamble to the Final Rule that private rights of action were
available for Section 1557 claims against recipients of Federal
financial assistance or State Exchanges for racial, national origin,
sex, age, or disability discrimination. See 81 FR at 31440 (stating
that ``both the proposed and the final rule specify that a private
right of action is available under Section 1557'' and such actions are
available ``on the basis of any of the criteria enumerated in the
legislation''). Multiple Federal courts have held that Section 1557, or
the statutes underlying it, do not permit private rights of action for
disparate impact claims of discrimination on the basis of race \20\ or
sex,\21\ and there is a split on the question with respect to
disability, with one Federal appellate court holding that such private
rights of action are not available and other Federal appellate courts
holding that such private rights of action are available for claims of
discrimination on the basis of disability.\22\
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\20\ See Southeastern Pennsylvania Transp. Authority v. Gilead,
102 F. Supp. 3d 688, 698-701 (E.D. Pa. 2015) (holding that Section
1557, incorporating Title VI, does not permit a private right of
action for a disparate impact claim on the basis of race); see also
Alexander v. Sandoval, 532 U.S. 275, 282-83 (2001).
\21\ See Condry v. UnitedHealth Group, No. 17-cf-00183-VC (N.D.
Calif. 2018) (``disparate impact claims on the basis of sex are not
cognizable under section 1557''); Weinreb v. Xerox Business
Services, 323 F. Supp. 3d 501, 521 (S.D.N.Y. 2018); Briscoe v.
Health Care Serv. Corp., 281 F. Supp. 3d 725, 738 (N.D. Ill. 2017);
York v. Wellmark, Inc., No. 4:16-cv-00627-RGE-CFB, at *15-16 (S.D.
Iowa Sep. 6, 2017); Southeastern Pennsylvania v. Gilead, 102 F.
Supp. 3d 688 (E.D. Pa. 2015).
\22\ Compare Crocker v. Runyon, 207 F.3d 314, 321 (6th Cir.
2000); Doe v. Bluecross Blueshield, No. 2:17-cv-02793-TLP-cgc, 2018
WL 3625012 (W.D. Tenn. 2018); and Briscoe v. Health Care Serv.
Corp., 281 F. Supp. 3d 725, 738 (N.D. Ill. 2017), with Valencia v.
City of Springfield, Ill., 883 F.3d 959, 967 (7th Cir. 2018); and
Hollenbeck v. U.S. Olympic Comm. 513 F.3d 1191, 1197 (10th Cir.
2008). To the Department's knowledge, no disparate impact claims on
the basis of age have been filed under Section 1557 in a Federal
court.
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These judicial interpretations of Section 1557 relied on Congress's
decision to include a rule of construction in Title IX stating that it
does not require educational institutions to use preferential treatment
based on a disparate impact basis,\23\ and the U.S. Supreme Court's
decisions precluding a right of action for disparate impact claims
under Title VI.\24\
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\23\ 20 U.S.C. 1681(b) (Title IX ``[s]hall not [be] construe[d]
to require an educational institution to grant preferential or
disparate treatment to the members of one sex on account of an
imbalance which may exist with respect to the total number or
percentage of persons of that sex participating in or receiving the
benefits of any Federally supported program or activity, in
comparison with the total number or percentage of persons of that
sex in any community, State, section, or other area.'').
\24\ Alexander v. Sandoval, 532 U.S. 275, 282 (2001) (holding
that private rights of action for disparate impact are not
authorized by Title VI).
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The Final Rule also stated that compensatory damages are available
in appropriate administrative and judicial actions under the Section
1557 Regulation, 45 CFR 92.301(b), and the Department stated in its
preamble that this was added ``to make clear in the regulation that
compensatory damages are available. Our interpretation of Section 1557
as authorizing compensatory damages is consistent with our
interpretations of Title VI, Section 504, and Title IX,'' 81 FR at
31440. However, the Department of Justice's Title VI Manual states
that, under applicable Federal case law, compensatory damages are
generally unavailable for claims based solely on an agency's disparate
impact regulations.\25\
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\25\ DOJ Title VI manual, https://www.justice.gov/crt/fcs/T6Manual9 (citing Alexander v. Sandoval, 532 U.S. 275, 282-83
(2001), Barnes v. Gorman, 536 U.S. 181, 187 (2002), and Gebser v.
Lago Vista Indep. Sch., 524 U.S. 274, 87 (1998)).
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The Final Rule also newly extended provisions applicable only to
some of the underlying civil rights laws to apply to all of the
prohibited bases of discrimination under Section 1557. For example,
although only the Section 504 (disability) and Title IX (sex)
regulations prohibit recipients from perpetuating discrimination by
providing significant assistance to any agency, organization, or person
that discriminates, the Final Rule extended this prohibition to Title
VI and Age Act claims under Section 1557.\26\ The Section 1557
Regulation similarly extended the prohibition, in the Title VI, Section
504, and Age Discrimination Act regulations, on the utilization of
criteria or methods of administration that have the effect of
subjecting individuals to discrimination, to claims of discrimination
on the basis of sex under Section 1557, although that prohibition is
not included in the Title IX regulations.\27\
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\26\ See 45 CFR 84.4(b)(1)(v) (Section 504), 86.23(b)(7) (Title
IX). But see 45 CFR 92.101(a)(4)(ii) (extended to age under Section
1557 Regulation), Sec. 92.101(b)(1)(ii) (extended to race, color or
national origin under Section 1557 Regulation).
\27\ See 45 CFR 80.3(b)(2) (Title VI), 84.4(b)(4) (Section 504),
91.11(b) (Age Act). But see 45 CFR 92.101(b)(3)(ii) (extended to sex
under Section 1557 Regulation).
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3. HHS Interpreted Federal Nondiscrimination Law Differently From Other
Federal Agencies
Because Section 1557, Title VI, Title IX, Section 504, and the Age
Act are cross-cutting civil rights laws enforced by multiple Federal
agencies the Department's interpretation of these laws should be
consistent with other interpretations within the Executive Branch.\28\
By applying different
[[Page 27852]]
substantive requirements and enforcement mechanisms, as discussed
above, HHS's Final Rule differed from other agencies' regulations on
Title VI, Title IX, Section 504, and the Age Act. HHS's Section 1557
Regulation is limited in scope to HHS-funded or HHS-administered health
programs, activities, and PPACA Title I entities, but Section 1557 of
the PPACA applies to health programs or activities which receive
Federal financial assistance from any Executive agency.\29\ Although
the then-OCR Director encouraged other agencies to adopt the standards
in the Final Rule in 2016,\30\ each agency has its own enforcement
responsibility for the programs they fund that fall within Section 1557
jurisdiction. One agency's implementation and enforcement of a civil
rights law that is inconsistent with other agencies would result in
confusion for entities regulated by more than one agency and for the
public as a whole, which is particularly imprudent given that Federal
courts have implied the availability of monetary damages in private
rights of action under the underlying civil rights statutes.\31\
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\28\ Pursuant to Executive Order 12250, the Attorney General has
the responsibility to ``coordinate the implementation and
enforcement by Executive agencies of (a) Title VI of the Civil
Rights Act of 1964 (42 U.S.C. 2000d et seq.). (b) Title IX of the
Education Amendments of 1972 (20 U.S.C. 1681 et seq.). (c) Section
504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794),
(d) Any other provision of Federal statutory law which provides, in
whole or in part, that no person in the United States shall, on the
ground of race, color, national origin, handicap, religion, or sex,
be excluded from participation in, be denied the benefits of, or be
subject to discrimination under any program or activity receiving
Federal financial assistance.'' Executive Order 12250 at sec. 1-
2(b), 45 FR 72995 (Nov. 2, 1980). See also 42 U.S.C. 6103 (requiring
each Federal department or agency to submit Age Act enforcement
reports to and obtain approval of their Age Act regulations by HHS).
\29\ Compare 42 U.S.C. 18116(a) (stating that Section 1557
applies to ``any health program or activity, any part of which is
receiving Federal financial assistance, including credits,
subsidies, or contracts of insurance, or under any program or
activity that is administered by an Executive Agency or any entity
established under this title (or amendments)'') (emphasis added)
with 45 CFR 92.1 (stating that Part 92 applies to health programs or
activities administered by recipients of Federal financial
assistance from the Department, Title I entities that administer
health programs or activities, and Department-administered health
programs or activities) (emphasis added).
\30\ Memorandum from OCR Director to Civil Rights Heads of
Federal Agencies, Enforcement Responsibilities under Section 1557 of
the Affordable Care Act (July 12, 2016), https://www.hhs.gov/sites/default/files/directors-memo-july2016.pdf.
\31\ Blunt v. Lower Merion Sch. Dist., 767 F.3d 247, 272 (3d
Cir. 2014) (Title VI); Franklin v. Gwinnett Cty. Pub. Sch., 503 U.S.
60 (1992) (Title IX).
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4. The Final Rule Created New Provisions Concerning Language Access Not
Adequately Justified by Law or Policy
Title VI prohibits discrimination against persons on the basis of
national origin under any program or activity receiving Federal
financial assistance. Under governing U.S. Supreme Court case law,
Title VI obligates recipients of Federal financial assistance to
provide individuals with limited English proficiency (LEP) meaningful
access to Federally funded programs or activities.\32\ In 2016, the
Section 1557 Final Rule added certain language access provisions that
were not required by Title VI case law or the underlying Title VI
regulation.\33\
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\32\ Lau v. Nichols, 414 U.S. 563 (1974) (interpreting Title VI
in the Department of Health Education and Welfare's Title VI
regulation). The Title VI statute does not expressly mention
``limited English proficiency.'' 42 U.S.C. 2000d et seq. Lau and its
progeny relied on the word ``national origin'' in Title VI to
encompass limited English proficiency (LEP).
\33\ See 45 CFR parts 80 and 81 (the Department's Title VI
regulations do not expressly reference LEP). Lau and subsequent case
law interpreted the Title VI regulations' prohibition on recipients
of Federal financial assistance ``utiliz[ing] criteria or methods of
administration which have the effect of subjecting individuals to
discrimination'' on the basis of national origin to require
recipients to take reasonable steps to provide persons with limited
English proficiency (LEP) meaningful access to Federally funded
programs or activities. The Supreme Court has not specified what
particular linguistic requirements may constitute ``meaningful
access'' outside of the education context.
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Additionally, the Final Rule introduced confusing and costly notice
and tagline requirements that were not required by law, were
inconsistent with tagline requirements required by other components of
the Department and, as discussed further below, provided relatively
minimal benefit to LEP individuals. Complicating matters further,
because the Section 1557 Regulation applies only to health care
programs or activities, a recipient of Federal financial assistance
from the Department for health care services is subject to different
notice and tagline requirements than a recipient receiving Federal
financial assistance from the Department for human services alone, such
as a child welfare agency.
Furthermore, the Final Rule newly required the OCR Director, in
evaluating compliance, to take into account whether a recipient of
Federal financial assistance has ``developed and implemented an
effective written language access plan that is appropriate to its
particular circumstances, to be prepared to meet its obligations''
under Section 1557. 45 CFR 92.201(b)(2). Before the promulgation of the
Final Rule, an Executive Order directed Executive agencies to prepare
language access plans applicable to their Federally conducted programs
and activities (for example, the Veterans Administration's hospitals),
but the Section 1557 provision applied to recipients of Federal
financial assistance (for example, private hospitals accepting
Medicaid). E.O. 13166, sec. 2, 65 FR 50121, 50121 (Aug. 16, 2000). The
last section of the Executive Order also stated that it ``does not
create any right or benefit, substantive or procedural, enforceable at
law.'' 65 FR 50122.
5. The Final Rule's Definition of Discrimination ``On the Basis of
Sex'' Has Been Enjoined by Federal Courts
In its Section 1557 Regulation, the Department interpreted the
``sex'' discrimination prohibited by Section 1557 to include
discrimination on the basis of ``gender identity.'' 81 FR 31376, 31467
(definition of ``on the basis of sex,'' codified at 45 CFR 92.4). In
particular, the Department took the view that one can identify as
``male, female, neither, or a combination of male and female'' and that
this identification may differ from one's ``sex assigned at birth''
because, according to the regulation, gender identity ultimately relies
on a subjective ``internal sense.'' 81 FR at 31467; 45 CFR 92.4
(definition of ``gender identity''). It then reasoned that Title IX's
prohibition of discrimination on the basis of sex (as incorporated by
Section 1557) includes discrimination on the basis of pregnancy
termination,\34\ sex stereotyping,\35\ and gender identity.\36\
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\34\ The preamble to the Final Rule cites the Department's Title
IX regulation, which contains provisions on termination of
pregnancy, but does not analyze this regulatory language in light of
Title IX's statutory provisions about abortion. See 81 FR at 31387
(citing 45 CFR 86.40(b)); but see 20 U.S.C. 1688 (``Nothing in this
title shall be construed to require or prohibit any person, or
public or private entity, to provide or pay for any benefit or
service, including the use of facilities related to an abortion . .
.'').
\35\ The Final Rule defines ``sex stereotypes'' as
``stereotypical notions of masculinity or femininity, including
expectations of how individuals represent or communicate their
gender to others, such as behavior, clothing, hairstyles,
activities, voice, mannerisms, or body characteristics. These
stereotypes can include the expectation that individuals will
consistently identify with only one gender and that they will act in
conformity with the gender-related expressions stereotypically
associated with that gender. Sex stereotypes also include gender
expectations related to the appropriate roles of a certain sex.'' 81
FR at 31468 (codified at 45 CFR 92.4).
\36\ The Final Rule defines ``gender identity'' as ``an
individual's internal sense of gender, which may be male, female,
neither, or a combination of male and female, and which may be
different from an individual's sex assigned at birth.'' 81 FR at
31467 (codified at 45 CFR 92.4). The Final Rule notes, in the
definition, that ``the way an individual expresses gender identity
is frequently called `gender expression,' and may or may not conform
to social stereotypes associated with a particular gender.'' Id. The
definition also notes that ``[a] transgender individual is an
individual whose gender identity is different from the sex assigned
to that person at birth.'' Id. The regulation requires covered
entities to treat individuals ``consistent with their gender
identity'' except that covered entities ``may not deny or limit
health services that are ordinarily or exclusively available to
individuals of one sex, to a transgender individual based on the
fact that the individual's sex assigned at birth, gender identity,
or gender otherwise recorded is different from the one to which such
health services are ordinarily or exclusively available.'' 45 CFR
92.206 and 92.207(b)(3).
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Interpreting Section 1557, through Title IX, to prohibit gender
identity
[[Page 27853]]
discrimination was a relatively novel legal theory when the Department
adopted the Final Rule. The theory, was not, and has not been, endorsed
by the Supreme Court. See, e.g., Baker v. Aetna, 228 F. Supp. 3d 764,
768-69 (N.D. Texas 2017) (noting no controlling U.S. Supreme Court
legal precedent recognizing gender identity as prohibited
discrimination under Section 1557).
a. Background on Title IX of the Education Amendments
Title IX prohibits discrimination on the basis of sex in
educational programs or activities that receive Federal financial
assistance. Specifically, the statute states that ``[n]o person in the
United States shall, on the basis of sex, be excluded from
participation in, be denied the benefits of, or be subjected to
discrimination under any education program or activity receiving
Federal financial assistance. . . .'' 20 U.S.C. 1681. The statute uses
the word ``sex'' but not ``sexual orientation'' or ``gender identity.''
Although it does not contain an express definition of the term ``sex,''
additional provisions in Title IX use explicitly binary terms such as
``men'' and ``women,'' ``father-son,'' ``mother-daughter,'' ``boys''
and ``girls,'' ``both sexes,'' and ``one sex'' and ``the other sex.''
\37\
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\37\ Although Congress did not include a definition of the term
``sex'', provisions in Title IX refer to ``men'' and ``women,''
``father-son,'' ``mother-daughter,'' ``boys'' and ``girls,'' ``both
sexes,'' and ``one sex'' and ``the other sex 42 U.S.C. 1681(a)(2)
(``both sexes''), (a)(2) (``one sex'' and ``other sex''), (a)(6)(B)
(``Men's'' and ``Women's''), (a)(6)(B) (``Boy'' and ``Girl'');
(a)(7)(A) (``Boys'' and ``Girls''), (a)(7)(B)(i) (``Boys'' and
``Girls''), (a)(8) (``father-son'', ``mother-daughter''), and (a)(8)
(``one sex'' and ``other sex''). See also 42 U.S.C. 1681(a)(2)(6)
(``fraternity'' and ``sorority'').
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Congressional activity in this area suggests that ``sex'' under
Title IX does not include sexual orientation or gender identity. See
Food & Drug Admin. v. Brown & Williamson Tobacco Corp., 529 U.S. 120,
122 (2000) (when ``Congress several times considered and rejected
bills'' that would have granted the agency authority, Congress
``evidenced a clear intent to preclude a meaningful policymaking role
for any administrative agency''). For example, in 2016, Senator Mazie
Hirono introduced the Patsy T. Mink Gender Equity in Education Act, S.
3147 (114th Cong. 2016), to ``support educational entities so that such
entities have the support to fully implement [T]itle IX'' and to define
``sex discrimination'' to include ``[a]ctual or perceived sex, sexual
orientation, gender, or gender identity.'' See also H.R. 5682 (114th
Cong. 2016) (companion measure introduced in the House of
Representatives). However, there was no action on the Senate bill after
it was referred to the Senate Committee on Health, Education, Labor and
Pensions. Congress has repeatedly considered bills that would add the
bases of sexual orientation or gender identity to other statutes that
already prohibited discrimination on the basis of sex, but has done so
in only limited instances.\38\
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\38\ 18 U.S.C. 249(c)(4) (the Matthew Shepard and James Byrd,
Jr. Hate Crimes Prevention Act prohibits hate crimes which are based
on ``actual or perceived religion, national origin, gender, sexual
orientation, gender identity, or disability''); 34 U.S.C.
12291(b)(13)(A) (the Violence Against Women Reauthorization Act
(VAWA) prohibits discrimination on the basis of ``actual or
perceived . . . sex, gender identity . . . [or] sexual
orientation'').
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Over the past three decades, Members of Congress have repeatedly
proposed to amend the Civil Rights Act to add the words ``sexual
orientation'' and ``gender identity'' as prohibited bases of
discrimination, but as of the date of publication of this proposed
rule, such measures have never become Federal law.\39\
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\39\ Over the past three decades, the Employment Non-
Discrimination Act (ENDA) has been introduced ten times in the U.S.
House of Representatives, but ENDA, which would prohibit employment
discrimination on the basis of sexual orientation and gender
identity, has never proceeded out of committee in the House. See
H.R. 4636 (103rd Cong. 1994); H.R. 1863 (104th Cong. 1995); H.R.
1858 (105th Cong. 1997); H.R. 2355 (106th Cong. 1999); H.R. 2692
(107th Cong. 2001); H.R. 3285 (108th Cong. 2003); H.R. 2015 (110th
Cong. 2007); H.R. 2981 (111th Cong. 2009); H.R. 1397 (112th Cong.
2011); H.R. 1755 (113th Cong. 2013). The Equality Act has similarly
been introduced in three successive sessions of Congress. See H.R.
3185 (114th Cong. 2015); S. 1828 (114th Cong. 2015); H.R. 2282
(115th Cong. 2017); S. 1006 (115th Cong. 2017); H.R. 5 (116th Cong.)
(introduced Mar. 3, 2019). It did not proceed out of committee in
the 114th and 115th Congresses, and it passed the House of
Representatives on May 17, 2019. The Equality Act would amend the
Civil Rights Act to include ``gender identity'' and ``sexual
orientation'' in addition to ``sex'' as prohibited grounds of
discrimination, and would also include a definition of the terms
``sex'' and ``gender identity.''
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b. HHS's Title IX Regulations
In 1975, the predecessor to HHS (the Department of Health,
Education, and Welfare (HEW)) became the first agency to adopt Title IX
implementing regulations. 40 FR 24128 (June 4, 1975). The agency
received and considered more than 9,700 comments before issuing its
final regulations, and Congress held six days of hearings to determine
whether the regulations were consistent with the statute.\40\ The
regulations,\41\ like Title IX itself, included no explicit definition
of ``sex.'' \42\ Like Title IX, however, the Title IX regulations do
use explicitly binary terms such as ``male and female'' (Sec.
86.41(c)) and ``one sex . . . [and] the other sex'' (passim).
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\40\ Subcommittee on Postsecondary Education of the House
Committee on Education and Labor, Review of Regulations to Implement
Title IX of Public Law 92-318 Conducted Pursuant to Sec. 431 of the
General Education Provisions Act (94th Cong. June 17, 20, 23, 24,
25, 26, 1975); see also Title IX Common Rule, 65 FR 52857 (Sept. 29,
2000) (the HEW regulations were ``the result of an extensive public
comment process and congressional review'').
\41\ See 45 CFR part 86.
\42\ Consistent with the statutory language, the Title IX
regulations used the same binary and biological language about sexes
as found in Title IX, including ``both sexes,'' ``the other sex,''
and ``boys'' and ``girls.'' See 45 CFR 86.2(s), 86.7, 86.17(b)(2),
86.21(c)(4), 86.31(c), 86.32(b)(2) and (c)(2), 86.33, 86.37(a)(3),
86.41(b) and (c), 86.55(a), 86.58(a) and (b), 86.60(b), and 86.61.
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When HHS interpreted ``on the basis of sex'' under Title IX through
its Section 1557 regulation, HHS did not add the definition to its
Title IX regulation. Neither did HHS amend its Title IX Regulation to
adjust the references to ``male and female'' or ``one sex . . . [and]
the other sex'' to conform to the novel definition in the Section 1557
regulation. Compare 81 FR 31467 (May 18, 2016) (Section 1557
Regulation) with 70 FR 24320 (May 9, 2005) (the last time HHS's Title
IX regulations were amended).
c. Need for Consistency Among Components of HHS
Since 2012, other components of the Department adopted an
interpretation of sex different from the definition OCR adopted in the
Section 1557 Regulation. The Department's failure to address these
other definitions in the Final Rule has resulted in substantial
confusion and inconsistency.
In 2014, the National Institutes of Health (NIH) announced its
policy that researchers seeking NIH grant funds should explain how
differences between males and females on the basis of biology are
factored into research designs, analyses, and reporting in clinical
research as a biological variable.\43\ This approach, according to NIH,
acknowledged that research about male and female differences may be
critical to the interpretation, validation, and generalizability of
research findings and may inform clinical interventions. In 2017, NIH
issued guidance to grant
[[Page 27854]]
recipients about this policy \44\ and continues to fund research that
uses ``sex'' as a biological variable.\45\ Using sex as a biological
variable addresses binary male/female differences found to impact the
practice of medicine by influencing proper diagnosis, prognosis, and
treatment of patients.\46\ Medical research prior to and subsequent to
the Section 1557 Regulation have addressed differences between males
and females as binary and biological.\47\
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\43\ Janine A. Clayton and Francis S. Collins, Policy: NIH to
balance sex in cell and animal studies, Nature (May 14, 2014)
(discussing disease-causing effects of Y-chromosome genes as
different from X-chromosome genes, and intrinsic sex differences of
female and male cells in vitro), https://www.nature.com/news/policy-nih-to-balance-sex-in-cell-and-animal-studies-1.15195; NIH,
Consideration of Sex as a Biological Variable in NIH-Funded
Research, NOT-OD-15-102 (June 9, 2015), https://grants.nih.gov/grants/guide/notice-files/not-od-15-102.html.
\44\ NIH Guidance, Consideration of Sex as a Biological Variable
in NIH-funded Research (2017), https://orwh.od.nih.gov/sites/orwh/files/docs/NOT-OD-15-102_Guidance.pdf.
\45\ Suk Kyeong Lee, Sex as an important biological variable in
biomedical research, BMB Rep. 167 (Apr. 2018), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5933211; Terry Lynn Cornelison,
Considering Sex as a Biomedical Variable in Biomedical Research,
Gender and the Genome (June 1, 2017), https://journals.sagepub.com/doi/pdf/10.1089/gg.2017.0006; Inna Belfer, J. White, et al.,
Considering sex as a biological variable (SABV) in research: a
primer for pain investigators, The Journal of Pain (Mar. 2018),
https://www.jpain.org/article/S1526-5900(17)31024-6/pdf.
\46\ Janine A. Clayton, Applying the new SABV (sex as a
biological variable) policy to research and clinical care,
Physiology and Behavior (Aug 17, 2017), https://doi.org/10.1016/j.physbeh.2017.08.012; see also Leah R. Miller, Cheryl Marks, et
al., Considering sex as a biological variable in preclinical
research, 31 Federation of American Societies for Experimental
Biology Journal 29-34 (Sept. 2017) (defining ``Sex'' as ``being XY
or XX''), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6191005.
\47\ See. e.g., Douglas C. Dean III, E.M. Planalp, et al.,
Investigation of brain structure in the 1-month infant, Brain
Structure and Function 1-18 (Jan. 5, 2018), https://www.ncbi.nlm.nih.gov/pubmed/29305647 (finding differences between
male and female infants at the age of 1 month, ``[c]onsistent with
findings from studies of later childhood and adolescence,
subcortical regions appear more rightward asymmetric''); Wei Yang,
Nicole M. Warrington, et al., Clinically Important Sex differences
in GBM biology revealed by analysis of male and female imaging,
transcriptome and survival data, Science Translational Medicine
(Jan. 21, 2019), https://www.ncbi.nlm.nih.gov/pubmed/30602536S
(identifying sex-specific molecular subtypes of glioblastoma);
Stefan Ballestri, Fabio Nascimbeni, et al., NAFLD as a Sexual
Dimorphic Disease: Role of Gender and Reproductive Status in the
Development and Progression of Nonalcoholic Fatty Liver Disease and
Inherent Cardiovascular Risk, Advances in Therapy (May 19, 2017),
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5487879; Ester Serrano-
Saiz, Meital Oren-Suissa, et al., Sexually Dimorphic Differentiation
of a C. elegans Hub Neuron Is Cell Autonomously Controlled by a
Conserved Transcription Factor, 27 Current Biology 199 (Jan. 5,
2017), https://www.ncbi.nlm.nih.gov/pubmed/28065609; Anke
Samulowitz, Ida Gremyr, et al., ``Brave Men'' and ``Emotional
Women'': A Theory-Guided Literature Review on Gender Bias in Health
Care and Gendered Norms towards Patients with Chronic Pain, Pain
Research and Management (Feb. 25, 2018), https://www.ncbi.nlm.nih.gov/pubmed/29682130 (stating that ``the response to
opioid receptor antagonists may generate a difference between men's
and women's experiences of pain''); Susan Sullivan, Anna Campbell,
et al., What's good for the goose is not good for the gander: Age
and gender differences in scanning emotion faces, 72:3 Journals of
Gerontology 441 (May 1, 2017), https://www.ncbi.nlm.nih.gov/pubmed/25969472; Ramona Stone and W. Brent Webber, Male-Female Differences
in the Prevalence of Non-Hodgkin Lymphoma, 81 Journal of
Environmental Health 16 (Oct. 2018).
---------------------------------------------------------------------------
NIH also funded conferences of mental health professionals who
developed the latest clinical manual on the diagnosis of ``gender
dysphoria'' that defines ``sex'' (as distinct from ``gender identity'')
in biological terms.\48\ Specifically, the Diagnostic and Statistical
Manual of Mental Disorders (DSM-5) provides, ``[t]his chapter employs
constructs and terms as they are widely used by clinicians from various
disciplines with specialization in this area. In this chapter, sex and
sexual refer to the biological indicators of male and female
(understood in the context of reproductive capacity), such as in sex
chromosomes, gonads, sex hormones, and nonambiguous internal and
external genitalia.'' \49\
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\48\ NIH sponsored thirteen scientific conferences that assisted
in research evaluation by hundreds of mental health specialists for
the American Psychiatric Association to produce the standard
classifications of mental disorders of the Diagnostic and
Statistical Manual of Mental Disorders Handbook of Differential
Diagnosis (DSM-5).
\49\ Although the Section 1557 Final Rule proposed to address
insurance coverage for care related to gender dysphoria on the basis
of a sex discrimination theory, neither the Notice of Proposed
Rulemaking in 2015 nor the Final Rule in 2016 referenced the DSM-5's
definition of the term ``sex.'' 81 FR 31429.
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Additionally, NIH requires research grant applicants to consider
sex as a biological variable ``defined by characteristics encoded in
DNA, such as reproductive organs and other physiological and functional
characteristics.'' \50\ According to an NIH article, ``[s]ex as a
biological variable (SABV) is a key part of the new National Institutes
of Health (NIH) initiative to enhance reproducibility through rigor and
transparency. The SABV policy requires researchers to factor sex into
the design, analysis, and reporting of vertebrate animal and human
studies. The policy was implemented as it has become increasingly clear
that male/female differences extend well beyond reproductive and
hormonal issues. Implementation of the policy is also meant to address
inattention to sex influences in biomedical research. Sex affects: Cell
physiology, metabolism, and many other biological functions; symptoms
and manifestations of disease; and responses to treatment. For example,
sex has profound influences in neuroscience, from circuitry to
physiology to pain perception. Extending beyond the robust efforts of
NIH to ensure that women are included in clinical trials, the SABV
policy also includes rigorous preclinical experimental designs that
inform clinical research.''
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\50\ NIH Guidance, Consideration of Sex as a Biological Variable
in NIH-funded Research at 1 (2017), https://orwh.od.nih.gov/sites/orwh/files/docs/NOT-OD-15-102_Guidance.pdf.
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In 2014, the Department's Office of Refugee Resettlement (ORR)
published an Interim Final Rule \51\ which adopted a biologically based
definition of ``sex'' that was distinct from gender identity, to
implement section 1101(c) of the Violence Against Women Reauthorization
Act of 2013.\52\ In setting forth standards and procedures to prevent,
detect, and respond to sexual abuse and sexual harassment involving
unaccompanied alien children in ORR's care provider facilities, the
rule defines ``sex'' as ``a person's biological status and is typically
categorized as male, female, or intersex.'' 45 CFR 411.5. The
definition notes that ``[t]here are a number of indicators of
biological sex, including sex chromosomes, gonads, internal
reproductive organs, and external genitalia.'' Id. The regulation gives
a separate definition for ``gender identity'' as ``one's sense of
oneself as a male, female, or transgender.'' Id. The rule then uses
these terms differently, setting forth protections and policies
concerning ``sex,'' distinct from those protections and policies
concerning ``gender'' or ``gender identity.'' \53\ The definitions
section of the ORR regulation states ``'Gender' refers to the
attitudes, feelings, and behaviors that a given culture associates with
a person's biological sex.'' 45 CFR 411.5 In the preamble to the rule,
ORR added, ``This term ['gender'] is not to be confused with `sex,' as
defined [elsewhere in the rule].'' 79 FR at 77771.
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\51\ ORR Final Rule, Standards to Prevent, Detect, and Respond
to Sexual Abuse and Sexual Harassment Involving Unaccompanied
Children, 79 FR 77767 (Dec. 24, 2014).
\52\ See 127 Stat. 61 (Violence Against Women's Act
reauthorization).
\53\ Compare, e.g., 45 CFR 411.14 (``Care provider facilities
must not search or physically examine a UC for the sole purpose of
determining the UC's sex. If the UC's sex is unknown, it may be
determined during conversations with the UC, by reviewing medical
records, or, if necessary, learning that information as part of a
broader medical examination conducted in private by a medical
practitioner.'') with Sec. 411.41(c) (``Only trained staff are
permitted to talk with UCs to gather information about their sexual
orientation or gender identity, prior sexual victimization, history
of engaging in sexual abuse, mental health status, and mental
disabilities for the purposes of the assessment required under
paragraph (a) of this section.'').
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In 2015, the Office of the National Coordinator for Health
Information Technology (ONC) promulgated regulations \54\ that included
standards
[[Page 27855]]
and requirements for coding certain health data. The regulations
contained data sets for ``sex,'' separate from those for ``gender
identity'' and ``sexual orientation.'' See 45 CFR 170.207(n) (``sex'');
170.207(o) (``sexual orientation and gender identity''). In its
preamble, ONC explained that it did not adopt a separate category for
``assigned birth sex'' because ``we already require the capturing of
birth sex as described under the ``sex'' section above.'' \55\
Furthermore, ONC stated that questions about patients' gender identity
and sexual orientation ``have not yet been scientifically validated for
use in health care settings'' and, thus, it did not adopt them.\56\
However, ONC added that, although not required, providers can
separately code ``gender identity'' \57\ and ``sexual orientation''
\58\ if they opt to include such questions.\59\
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\54\ ONC Final Rule, 2015 Edition Health Information Technology
(Health IT) Certification Criteria, 2015 Edition Base Electronic
Health Record (EHR) Definition, and ONC Health IT Certification
Program Modifications, 80 FR 62601 (Oct. 16, 2015); see also 80 FR
76868 (Dec. 11, 2015) (making technical corrections and
clarifications).
\55\ 80 FR 62619. Requiring health care entities to code as male
all persons who self-identify as male, regardless of biology, may
lead to adverse health consequences. See, e.g., Daphne Stroumsa,
Elizabeth F.S. Roberts, et al., ``The Power and Limits of
Classification--A 32 Year Old Man with Abdominal Pain,'' New England
Journal of Medicine (May 16, 2019), https://www.ncbi.nlm.nih.gov/pubmed/31091369; Marilynn Marchione, ``Blurred Lines,'' Associated
Press (May 15, 2019), https://apnews.com/b5e7bb73c6134d58a0df9e1cee2fb8ad (identification of pregnant
transgender person as male in medical records contributed to
stillbirth of child).
\56\ 80 FR at 62620.
\57\ Options under the category ``gender identity'' were
``Male'', ``Female, transgender male/Trans man/Female-to-male,''
``Transgender female/Trans woman/Male-to-female,'' ``Genderqueer,
Neither exclusively male nor female,'' ``Additional gender category/
(or other), please specify,'' or ``Decline to answer.''
\58\ Options under the category ``sexual orientation'' were
``Straight or heterosexual,'' ``Lesbian, gay, or homosexual,''
``Bisexual,'' ``Something else, please describe,'' or ``Don't
know.''
\59\ 80 FR 62620.
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OCR itself has adopted different interpretations of ``on the basis
of sex'' under Section 1557. In 2012, the then-OCR Director announced
in a letter \60\ that OCR was accepting and investigating complaints of
discrimination on the basis of ``actual or perceived sexual orientation
or gender identity'' under Section 1557. Three years later, OCR changed
its position and declined to include sexual orientation (unlike gender
identity) as a per se protected class throughout the Section 1557
rulemaking process. See Proposed Rule, 81 FR 54176 (Aug. 15, 2015)
(``Current law is mixed on whether existing Federal nondiscrimination
laws prohibit discrimination on the basis of sexual orientation as a
part of their prohibitions of sex discrimination''); Final Rule, 81 FR
31390 (May 18, 2016) (``OCR has decided not to resolve in this rule
whether discrimination on the basis of an individual's sexual
orientation status alone is a form of sex discrimination.''). It
appears that OCR's letter in 2012 was the first time any HHS component
departed from a binary and biological understanding of sex for purposes
of sex discrimination and adopted a definition that included gender
identity or sexual orientation.
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\60\ See 81 FR 31387, n.57.
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d. Pending Federal Litigation Over Section 1557 Regulation, Title IX,
and Title VII
In addition to Franciscan Alliance in the U.S. District Court for
the Northern District of Texas and Sisters of Mercy in the U.S.
District Court for the District of North Dakota, other Federal courts
have gender identity discrimination cases, filed under Section 1557,
pending on their dockets. See Tovar v. Essentia Health, 342 F. Supp. 3d
947 (D. Minn. Sept. 20, 2018) (on remand from 8th Cir.); Boyden v.
Conlin, 341 F. Supp.3d 979 (W.D. Wis. 2018) (appealed to 7th Cir., No.
3:18-3408 and No. 18-3485, on Nov. 9, 2018); Flack v. Wisconsin
Department of Health Services, 328 F. Supp.3d 931 (W.D. Wis. 2018)
(pending motion for class certification); Smith v. Highland Hospital of
Rochester, No. 17-CV-6781-CJS (W.D.N.Y. filed Oct 2, 2018) (appealed to
2d Circuit on Nov. 6, 2018); Prescott v. Rady Children's Hospital-San
Diego, 265 F.Supp.3d 1090 (S.D. Cal. Sept. 27, 2017) (protective order
granted on Nov. 6, 2018); Edmo v. Idaho Dept. of Correction, No. 1:17-
cv-00151, 2018 WL 2745898 (D. Id. filed Oct. 9, 2018) (motion to stay
pending February 13, 2019); Enstad v. Peacehealth, No. 2:17-cv-01496-
RSM (W.D. Wash. filed Oct. 5, 2017) (granted stay of litigation on
Sept. 24, 2018); Robinson v. Dignity Health, No. 16-CV-3035 YGR, 2016
WL 7102832 (N.D. Cal. filed Dec. 6, 2016) (on remand from U.S. Supreme
Court).
Some Federal courts have declined to recognize gender identity
discrimination claims under Title IX, and instead deferred to U.S.
Supreme Court to settle the legal question. See, e.g., Evancho v. Pine-
Richland School District, 237 F. Supp.3d 267, 299 (W.D. Pa. February
27, 2017) (``what makes the current legal landscape even more unsettled
is that the Supreme Court is currently poised to grapple with these
very issues''). While four appellate courts have addressed the
issue,\61\ a large volume of district court opinions have been
inconsistent on the issue. See Texas v. United States, 201 F. Supp. 3d
810 (N.D. Tex. 2016) (holding that Title IX does not prohibit
discrimination based on gender identity or transgender status);
Johnston v. Univ. of Pittsburgh, 97 F. Supp. 3d 657 (W.D. Pa. 2015);
but see Adams v. School Board of St. Johns County, 318 F. Supp. 3d 1293
(M.D. Fla. 2018) (recognizing gender identity discrimination claim
under Title IX); A.H. v. Minersville Area School District, 290 F. Supp.
3d 321 (M.D. Pa. 2017). Appellate courts have also been split over the
legal question whether discrimination on the basis of gender identity
is prohibited by Title VII. Compare Etsitty v. Utah Transit Auth., 502
F.3d 1215, 1220-1221 (10th Cir. 2007) with Mitchell v. Kallas, No. 15-
cv-108 (7th Cir. 2018). On April 22, 2019, the U.S. Supreme Court
granted three petitions for writs of certiorari, raising the question
whether Title VII's prohibition on discrimination on the basis of sex
also bars discrimination on the basis of gender identity or sexual
orientation.\62\ Because Title IX adopts the substantive and legal
standards of Title VII,\63\ a holding by the U.S. Supreme Court on the
definition of ``sex'' under Title VII will likely have ramifications
for the definition of ``sex'' under Title IX, and for the cases raising
sexual orientation or gender identity claims under Section 1557 and
Title IX which are still pending in district courts.\64\
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\61\ See, e.g., Doe ex rel. Doe v. Boyertown Area Sch. Dist.,
893 F.3d 179 (3d Cir.), slip op. 23-31, vacated on reh'g, 897 F.3d
515 (3d Cir.), and superseded by 897 F.3d 518 (3d Cir. 2018);
Whitaker ex rel. Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of
Educ., 858 F.3d 1034, 1046-54 (7th Cir. 2017), cert. dismissed, 138
S. Ct. 1260 (2018); G.G. ex rel. Grimm v. Gloucester Cnty. Sch. Bd.,
822 F.3d 709, 720-723 (4th Cir. 2016), vacated and remanded, 137 S.
Ct. 1239 (2017); Dodds v. U.S. Dept. of Education, 845 F.3d 217 (6th
Cir. 2016). Portions of two of these opinions have been vacated. See
Gloucester Cnty. Sch. Bd. v. G.G. ex rel. Grimm, 137 S. Ct. 1239
(2017) (vacating court of appeals' decision in light of agency
guidance); Doe ex rel. Doe v. Boyertown Area Sch. Dist., 897 F.3d
518, 533-36 (3d Cir. 2018) (superseding opinion omitting portion of
original opinion discussed in the petition, which was vacated on
rehearing); cf. Doe, 893 F.3d 179, slip op. 23-31 (vacated opinion).
\62\ Bostock v. Clayton County, 723 Fed. Appx. 964 (11th Cir.
2018), cert granted, No. 17-1618 (U.S. Apr. 22, 2019); Altitude
Express, Inc. v. Zarda, 883 F.3d 100 (2d Cir. 2018), cert granted,
No. 17-1623 (U.S. Apr. 22, 2019); Equal Employment Opportunity
Commission v. R.G. & G.R. Harris Funeral Homes, Inc., 884 F.3d 560
(6th Cir. 2018), cert granted, No. 18-107 (U.S. Apr. 22, 2019),
https://www.supremecourt.gov/orders/courtorders/042219zor_9olb.pdf.
\63\ See DOJ, Title IX Legal Manual (August 6, 2015), https://www.justice.gov/crt/title-ix.
\64\ Compare Etsitty v. Utah Transit Auth., 502 F.3d 1215 (10th
Cir. Sept. 20, 2007) (Title IX does not prohibit gender identity
discrimination); and Texas v. United States, 201 F. Supp. 3d 810
(N.D. Tex. Aug. 21, 2016) with Doe ex rel. Doe v. Boyertown Area
Sch. Dist., 893 F.3d 179 (3d Cir.), slip op. 23-31, vacated on
reh'g, 897 F.3d 515 (3d Cir.), and superseded by 897 F.3d 518 (3d
Cir. 2018); Whitaker ex rel. Whitaker v. Kenosha Unified Sch. Dist.
No. 1 Bd. of Educ., 858 F.3d 1034, 1046-1054 (7th Cir. 2017)
(interpreting Title IX and Equal Protection Clause), cert.
dismissed, 138 S. Ct. 1260 (2018); and G.G. ex rel. Grimm v.
Gloucester Cnty. Sch. Bd., 822 F.3d 709, 720-723 (4th Cir. 2016),
vacated and remanded, 137 S. Ct. 1239 (2017).
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[[Page 27856]]
e. HHS's Inconsistency With Other Federal Agencies
From 1972 to the present, no Title IX regulation from any agency
explicitly defined ``sex'' to include ``gender identity.'' All of the
Title IX regulations of all agencies which adopted such regulations--
including, as noted above, HHS's Title IX regulations--use the term in
a binary and biological sense, and include phrases such as ``male and
female,'' and ``one sex'' and ``the other sex.'' \65\ Currently, HHS is
the only Federal agency with a regulation defining ``sex'' under Title
IX (in its Section 1447 Regulation) as inclusive of gender identity.
However, starting in 2012, two other agencies--the Department of
Justice (DOJ), and the Department Education (ED)--took enforcement
actions, issued guidance, or took litigating positions that
discrimination on the basis of sex under certain anti-discrimination
statutes included ``gender identity.'' See ED, Office for Civil Rights,
Questions and Answers in Title IX and Single Sex Elementary and
Secondary Classes and Extracurricular Activities (2014); \66\ ED and
DOJ joint Dear Colleague Letter on Transgender Students (May 13, 2016)
(Title IX guidance); Complaint, United States v. McCrory, No. 5:16-cv-
238-BO (M.D.N.C. filed May 9, 2016) (DOJ Title IX lawsuit challenging a
North Carolina law concerning transgender access to intimate facilities
at State university). The Department proposed (and then finalized) its
definition to be consistent with the policy positions, sub-regulatory
guidance, and enforcement actions of ED and DOJ.\67\
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\65\ See, e.g., Department of Education Title IX regulation at
34 CFR 106.2(s), 106.7, 106.17(b)(2), 106.21(c)(4), 106.31(c),
106.32(b)(2) and (c)(2), 106.33, 106.37(a)(3), 106.41(b) and (c),
106.55(a), 106.58(a) and (b), 106.60(b), and 106.61; Department of
Justice Title IX regulation at 28 CFR 54.105, 54.130, 54.230(b)(2),
54.235(b)(3), 54.300(c)(4), 54.400(c), 54.405(b)(2) and (c)(2),
54.410, 54.430(a)(3), 54.450(b) and (c)(2), 54.520(a), 54.535(a) and
(b), 54.545(b), and 54.550. See also DOJ Coordination and Compliance
Division, Title IX Regulations by Agency, https://www.justice.gov/crt/fcs/Agency_Regulations#2.
\66\ http://www2.ed.gov/about/offices/list/ocr/docs/faqs-title-ix-single-ex201412.pdf.
\67\ See 81 FR at 31388-31389.
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The earlier interpretations have now been taken under review,
dismissed, preliminarily enjoined, or revoked outright. See Franciscan
Alliance, Inc., et al. v. Burwell, et al., 227 F. Supp. 3d 660, 696
(N.D. Tex. 2016) (nationwide preliminary injunction against the Section
1557 regulation); Texas, et al. v. United States, et al., 201 F. Supp.
3d 810, 836 (N.D. Tex. 2016) (preliminarily enjoining ED's Title IX
interpretation); Dear Colleague Letter (Feb. 22, 2017) (ED and DOJ's
withdrawal of the May 13, 2016 Dear Colleague Letter); Stipulated Joint
Notice of Dismissal, United States v. State of North Carolina, No.
1:16-cv-425 (M.D.N.C. May 4, 2017) (dismissing, with prejudice, the DOJ
lawsuit challenging the North Carolina law).
As noted above, in Franciscan Alliance, DOJ submitted a brief on
behalf of HHS, in response to plaintiffs' motions for summary judgment,
on April 5, 2019. The brief stated that Section 1557's prohibition on
sex discrimination ``unambiguously excludes discrimination on the basis
of gender identity.'' \68\
---------------------------------------------------------------------------
\68\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O, p. 11 (N.D. Tex, filed April 5, 2019).
---------------------------------------------------------------------------
The Department proposes to repeal the novel definition of ``sex''
in the Section 1557 regulation in order to make the Department's
regulations implementing Title IX through the Section 1557 Regulation
more consistent with the Title IX regulations of other Federal
agencies. The Department further believes this proposed rule avoids
different interpretations of the same statute by multiple agencies, and
promotes consistent expectations and enforcement.
f. Need for Consistency With the Department of Justice on
Implementation and Enforcement of Nondiscrimination Laws
In 1980, the President delegated to the Attorney General the
responsibility to lead the coordination of consistent and effective
implementation of cross-cutting nondiscrimination laws, including Title
VI, Title IX, and Section 504.\69\ The Department, along with each
other Executive Agency, is required to cooperate with DOJ and issue its
implementing regulations consistent with the requirements prescribed by
the Attorney General, unless prohibited by law.\70\
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\69\ Executive Order 12250, Leadership and Coordination of
Nondiscrimination Laws, Secs. 1-201(a) through (c), 45 FR 72995
(Nov. 2, 1980).
\70\ Executive Order 12250 at Secs. 1-401 through 1-402.
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In court briefs and otherwise on behalf of the United States, DOJ
has stated that the ordinary meaning of the word ``sex'' for purposes
of Federal nondiscrimination laws does not encompass sexual orientation
or gender identity. On April 5, 2019, DOJ filed a brief on behalf of
HHS in the Franciscan Alliance case stating that ``the relevant
provisions of Title IX and Section 1557 unambiguously exclude gender-
identity discrimination.'' \71\ Similarly, in a July 26, 2017 amicus
curiae brief in a Second Circuit case regarding the prohibition of sex
discrimination in employment under Title VII of the Civil Rights Act of
1964, DOJ stated, `` `[i]n common, ordinary usage in 1964--and now, for
that matter--the word `sex' means biologically male or female.' '' \72\
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\71\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O, p. 14 (N.D. Tex, filed April 5, 2019).
\72\ See also DOJ Brief for the United States as Amicus Curiae,
p. 4, in Zarda v. Altitude Express, Inc., 883 F.3d 100 (2d Cir. July
26, 2017) (quoting dissent in Hively v. Ivy Tech Community College,
853 F.3d 339, 362 (7th Cir. 2017)); DOJ Brief in Support of
Defendants' Motion to Dismiss at 2-6, U.S. Pastor Council v. EEOC,
No. 4:18-cv-00824-O (N.D. Tex. Dec. 17, 2018).
---------------------------------------------------------------------------
Consistent with this position, a few months later, the Attorney
General issued a memorandum stating that `` `sex' is ordinarily defined
to mean biologically male or female'' and that ``Congress has confirmed
this ordinary meaning by expressly prohibiting, in several other
statutes, `gender identity' discrimination, which Congress lists in
addition to, rather than within, prohibitions on discrimination on the
basis of `sex' or `gender.' '' \73\ The memorandum concluded, ``Title
VII's prohibition on sex discrimination encompasses discrimination
between men and women but does not encompass discrimination based on
gender identity per se, including transgender status. Therefore, as of
the date of this memorandum . . . the Department of Justice will take
that position in all pending and future matters . . . .''
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\73\ Memorandum of the Attorney General (Oct. 4, 2017), https://www.justice.gov/ag/page/file/1006981/download.
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DOJ also took that position on October 24, 2018, when it submitted
a brief to the U.S. Supreme Court in another Title VII case in which a
petition for a writ of certiorari was filed. DOJ argued that ``Title
VII does not define the term `sex,' so the term should `be interpreted
as taking [its] ordinary, contemporary, common meaning.' When Title VII
was enacted in 1964, `sex' meant biological sex; it `refer[red] to
[the] physiological distinction[ ]' between `male and female.' Title
VII thus does not apply to discrimination against an individual
[[Page 27857]]
based on his or her gender identity. Notably, Congress has specifically
prohibited discrimination based on `gender identity' in other statutes,
as a separate protected category in addition to `sex' or `gender.' It
has not included similar language in Title VII as originally enacted in
1964 or in any amendment in the 54 years since.'' \74\
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\74\ DOJ, Brief for the Federal Respondent in Opposition to
Petition for Writ of Certiorari in R.G. & G.R. Harris Funeral Homes,
Inc. v. Equal Employment Opportunity Commission, et al., No. 18-107,
16-18 (Oct. 2018) (citations omitted).
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Nevertheless, because the Section 1557 Regulation's gender identity
provisions remain, public confusion persists. To ensure that its civil
rights regulations are consistent with the views of the Department of
Justice, other Federal agencies, and internally, the Department
proposes to repeal the definition of ``on the basis of sex'' that had
been adopted in its Section 1557 Final Rule. Because of the likelihood
that the Supreme Court will be addressing the issue in the near
future,\75\ the Department declines, at this time, to propose its own,
definition of ``sex'' for purposes of discrimination on the basis of
sex in the regulation.
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\75\ See Bostock v. Clayton County, 723 Fed. Appx. 964 (11th
Cir. 2018), cert granted, No. 17-1618 (U.S. Apr. 22, 2019); Altitude
Express, Inc. v. Zarda, 883 F.3d 100 (2d Cir. 2018), cert granted,
No. 17-1623 (U.S. Apr. 22, 2019); Equal Employment Opportunity
Commission v. R.G. & G.R. Harris Funeral Homes, Inc., 884 F.3d 560
(6th Cir. 2018), cert granted, No. 18-107 (U.S. Apr. 22, 2019),
https://www.supremecourt.gov/orders/courtorders/042219zor_9olb.pdf.
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g. Sensitive Balancing of Competing Interests at the Local Level
The adoption of a definition of ``sex'' in the Section 1557
Regulation may stifle the ability of States, local governments, and
covered entities to set their own policies and balance multiple
competing interests on questions related to gender dysphoria. Because
Title IX and Section 1557 get their constitutional authority from the
Spending Clause, according to the Supreme Court, it is appropriate that
it be exercised with respect for State sovereignty:
[L]egislation enacted pursuant to the spending power is much in the
nature of a contract: In return for federal funds, the States agree
to comply with federally imposed conditions. The legitimacy of
Congress' power to legislate under the spending power thus rests on
whether the State voluntarily and knowingly accepts the terms of the
``contract.'' See Steward Machine Co. v. Davis, 301 U. S. 548, 585-
598 (1937); Harris v. McRae, 448 U. S. 297 (1980). There can, of
course, be no knowing acceptance if a State is unaware of the
conditions or is unable to ascertain what is expected of it.
Accordingly, if Congress intends to impose a condition on the grant
of federal moneys, it must do so unambiguously. Cf. Employees v.
Department of Public Health and Welfare, 411 U. S. 279, 285 (1973);
Edelman v. Jordan, 415 U. S. 651 (1974). By insisting that Congress
speak with a clear voice, we enable the States to exercise their
choice knowingly, cognizant of the consequences of their
participation.
Pennhurst State School and Hospital v. Halderman, 451 U.S. 1, 17
(1981); see also National Federation of Independent Business v.
Sebelius, 567 U.S. 519, 588 (2012) (``Congress has no authority to
order the States to regulate according to its instructions. Congress
may offer the States grants and require the States to comply with
accompanying conditions, but the States must have a genuine choice
whether to accept the offer'') (opinion of Roberts, C.J., joined by
Breyer and Kagan, JJ.). The Department's broad reinterpretation of
``sex'' under Title IX affected States' ability to accept these
restrictions knowingly as they came long after states became heavily
reliant on the continued receipt of Federal funds subject to Title IX
requirements.
This proposed rule would significantly restore the ability of
States to establish policies in this area, based on their weighing the
competing interests at stake. This proposed rule is not intended to
remove any protection that Congress has provided by statute, including
Title IX, or to deny States the ability to provide protections that
exceed those required by Title IX. Rather, the proposed rule would
ensure that the Department's Title IX and corresponding Section 1557
regulations follow the will of Congress with respect to the States by
not expanding Title IX's definition of ``sex'' beyond the statutory
bounds.
C. The Costs of the Final Rule Were Unnecessary and Unjustified
The Department has determined that the Section 1557 Regulation
imposed substantially larger regulatory burdens than predicted, a
result inconsistent with the policies of this Administration. In his
first day in office, President Donald Trump issued Executive Order
13765, identifying it as Administration policy to ``minimize the
unwarranted economic and regulatory burdens of the [Patient Protection
and Affordable Care] Act, and prepare to afford the States more
flexibility and control to create a more free and open healthcare
market.'' This Executive Order states that ``the Secretary of Health
and Human Services (Secretary) and the heads of all other executive
departments and agencies (agencies) with authorities and
responsibilities under the [PPACA] shall exercise all authority and
discretion available to them to waive, defer, grant exemptions from, or
delay the implementation of any provision or requirement of the [PPACA]
that would impose a fiscal burden on any State or a cost, fee, tax,
penalty, or regulatory burden on individuals, families, healthcare
providers, health insurers, patients, recipients of healthcare
services, [or] purchasers of health insurance.'' President Trump has
also issued two further Executive Orders directing executive agencies
to relieve the regulatory burden and reduce regulatory costs across the
Federal government.\76\
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\76\ Executive Order 13771 on Reducing Regulation and
Controlling Costs (Jan. 30, 2017); Executive Order 13777 on
Enforcing the Regulatory Reform Agenda (Feb. 24, 2017); see also
Executive Order 13563 on Improving Regulation and Regulatory Review,
76 FR 3821 (Jan. 21, 2011).
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1. The Section 1557 Regulation Imposed Substantially Higher Regulatory
Costs Than Predicted
The Department has concluded, based on its independent assessment
of the evidence, that the costs and burdens imposed by the Section 1557
Regulation are substantially larger than originally anticipated. The
Final Rule requires covered entities to post and disseminate to
beneficiaries, enrollees, and the public, detailed notices of
nondiscrimination that include information on how individuals with
disabilities may receive auxiliary aids and services and how LEP
individuals may receive translated documents or oral interpretation. 45
CFR 92.7. The Department estimated that this notice requirement would
impose approximately $3.6 million of costs in the first year of
compliance and zero for the following four years. In calculating this
cost, the Department counted the 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. 81 FR 31453,
31458.
The Final Rule additionally requires covered entities to provide to
beneficiaries, enrollees, and others, ``taglines'' describing the
availability of free language assistance services. The Final Rule
requires these taglines be written in ``at least the top 15 languages''
spoken by LEP individuals in the relevant State or States. 45 CFR
92.8(d)(1). The Department estimated that the taglines requirement
would cost the same as the notice of nondiscrimination requirement,
namely, $3.6 million in the first year and zero over the following four
years. 81 FR
[[Page 27858]]
31453, 31458. Again, as with notices, the Department counted the
employee time required to initially download, print, and post taglines,
but did not count the recurring costs of paper, ink/toner, and
additional postage for the required initial or subsequent mailings of
taglines. 81 FR 31453.
The Department did not fully appreciate the volume of mail inserts
the combined notice and tagline provisions would require. The Final
Rule requires notices of nondiscrimination and taglines be appended to
all ``significant'' publications and communications (bigger than a
postcard or brochure) sent by covered entities to beneficiaries,
enrollees, applicants, or members of the public. 45 CFR 92.8(f)(1). The
Final Rule's preamble explained that ``significant communications''
include ``not only documents intended for the public . . . but also
written notices to an individual, such as those pertaining to rights or
benefits.'' 81 FR 31402. Many health insurance issuers reasonably
interpreted the Section 1557 Regulation as requiring that they provide
the notice and taglines to their subscribers in nearly every written
communication, including every time the issuer processes a claim and,
as a consequence, issues a beneficiary an Explanation of Benefits.
Many of these matters were discussed in DOJ's 2002 and HHS's 2003
LEP guidance documents. The LEP guidance documents flagged concerns
about ``unrealistic'' interpretations of translating written materials
into languages when recipients serve communities in large cities or
across the country and serve LEP persons who speak dozens and sometimes
over 100 different languages. 67 FR 41455, 41463 (June 18, 2002) (DOJ
guidance); 68 FR 47311, 47319 (Aug. 8, 2003) (HHS guidance).
Furthermore, with the recognition that there could be large numbers of
documents in need of translation into dozens of languages, the LEP
guidance documents advised that recipients could start with several of
the more frequently encountered languages and set benchmarks for
continued translations into the remaining languages over time. 67 at
41463 (DOJ); 68 FR at 47319 (HHS). By contrast, the Section 1557
Regulation set an effective date of July 18, 2016--only 60 days after
promulgation of the final rule. The Section 1557 Regulation used the
vague term ``significant'' to identify documents to which providers
must append translated tagline notices. See 45 CFR 92.8(g). However,
the Department's long-standing LEP guidance discussed translation of
``vital'' documents, with the acknowledgement that ``[c]lassifying a
document as vital or non-vital is sometimes difficult'' because the
health care context is so fact-specific, depending on ``the importance
of the program, information, encounter, or service involved, and the
consequence to the LEP person if the information in question is not
provided accurately or in a timely manner.'' 68 FR at 47318 (HHS
guidance).
In practice, the notices and taglines requirement results in the
inclusion of one to two sheets of paper (which may be double-sided) per
each significant communication mailed by a covered entity.
Data collected from covered entities, and the Department's
independent analysis, illustrate the financial impact of the notice and
tagline requirements. One covered health insurance issuer, which sends
over 42 million Explanations of Benefits for one of its health plans to
enrollees each year, states that it was required to add 2-5 pages of
disclosure content to each letter or document, and estimates the
incremental cost of printing, paper, and postage alone to be
approximately $8 million per year.\77\ That covered health insurance
issuer also reported that another of its health plans, which
communicates with enrollees 50 to 90 times per year, estimated that it
is spending approximately $14 million annually on printing and postage
for notice and tagline requirements.\78\ A third plan reported that its
costs for taglines were $802,000 for the last quarter of 2016 and were
projected to be $2.4 million in 2017.\79\ Another large plan estimates
it will spend $4-5 million per year to comply with these
requirements.\80\
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\77\ Source: Aetna health plan representatives (April 13, 2017).
\78\ Source: Aetna health plan representatives (May 1, 2017).
\79\ Source: Aetna (April 10, 2017).
\80\ Source: UnitedHealth Group (April 10, 2017).
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A pharmacy benefit managers (PBM) trade association has reported
similar effects of the Section 1557 Regulation. It estimates that PBMs
process over three billion prescriptions per year, with each
prescription requiring multiple ``significant'' communications be sent
to beneficiaries (such as explanations of benefits, refill reminders,
drug safety information, and other notices), many of which are sent by
mail. The trade association estimates that this amounts to between 1
and 4.8 billion notices and taglines mailed per year at approximately
$0.50 to $1 in additional printing and postage costs per communication.
Thus, according to the trade association, these requirements have cost
PBMs from $500 million to nearly $5 billion per year.\81\ The high
costs that health insurance issuers, health plans, and the members of a
PBM trade association have reported about the costs resulting from the
notice and tagline provisions of the Final Rule prompted the Department
to reevaluate the requirement and its associated benefits and burdens.
---------------------------------------------------------------------------
\81\ Source: Pharmaceutical Care Management Association (May 2,
2017).
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As discussed further in the Regulatory Impact Analysis of this
proposed rule, and based on the Department's independent analysis, the
Department concludes that its original assessment of $7.2 million in
one-time notice and tagline-related costs underestimated the actual
costs associated with including nondiscrimination notices and taglines
in significant communications and publications.
The Department now estimates that the burden from the notice and
taglines requirement ranges from $147 million (low-end) to $1.34
billion dollars (high-end) in annual costs before accounting for
electronic delivery, as described below. These estimates are a function
of multiplying the low and high per-unit cost of including a
nondiscrimination notice and tagline insert ($0.035/per unit to $0.32/
per unit) by the volume of significant communications and publications
to which covered entities are required to attach the notice and
taglines. The Regulatory Impact Analysis explains the calculations
underlying these estimates in detail. The Department uses an average of
the low- and high-end estimates, and adjusts for electronic delivery,
to arrive at an average savings of $0.632 billion per year which totals
approximately $3.16 billion over five years. The Regulatory Impact
Analysis explains the assumptions, rationale, and calculations for this
weighted average.
2. The Section 1557 Regulation's Burdens Are Not Justified by Need
The Department does not believe that the regulatory burdens of the
Section 1557 Regulation, either as originally anticipated or as now
more correctly estimated, are justified. The Department stated in the
Final Rule that, apart from burdens related to the Final Rule's
definition of discrimination ``on the basis of sex'' and provisions
concerning language access plans,\82\ ``we do not
[[Page 27859]]
anticipate that covered entities will undertake new actions or bear any
additional costs in response to the issuance of the regulation''
because the Final Rule applies ``pre-existing requirements'' that have
applied to regulated entities ``for years.'' 81 FR 31446. Indeed, the
Department noted in the preamble to the Final Rule that, following the
passage of Section 1557 in 2010, the Department's Office for Civil
Rights (OCR) complaint workload had increased only ``slightly.'' 81 FR
31458.
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\82\ Language access plans are meant to assist covered entities
in fulfilling their obligations to provide LEP individuals
meaningful access to services provided by the covered entity.
Although the Final Rule did not require covered entities to develop
a language access plan, the Rule stated that the development and
implementation of a language access plan is a factor the Director
``shall'' take into account when evaluating whether an entity is in
compliance with Section 1557. 45 CFR 92.201(b)(2). The Department
anticipated that 50% of covered entities would develop and implement
a language access plan following issuance of the Final Rule. 81 FR
31454.
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These facts call into question the need for both the $942 million
in costs to the public over five years that the Department originally
anticipated, 81 FR 31459, and the additional approximately $3.2 billion
in notice and tagline compliance costs of which the Department is now
aware.
Several factors suggest that the extraordinary burdens imposed by
the notice and tagline requirements in particular are not justified by
need. First, those requirements are difficult for covered entities to
implement because of other differing and overlapping requirements
already imposed by the Federal government (with respect to Federal
health care programs such as Medicare), and by many States (with
respect to State-regulated health insurance), concerning language
access.\83\
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\83\ E.g., 42 U.S.C. 300gg-15(b)(2) and 300gg-19(a)(1)(B)
(requiring standards for ensuring that the Summaries of Benefits and
Coverage and certain notices are provided in a culturally and
linguistically appropriate manner); 42 U.S.C. 1396d(p)(5)(A)
(requiring HHS to distribute to States an application form for
Medicare cost-sharing in English and 10 non-English languages); 26
CFR 1.501(r)-4(a)(1), (b)(5)(ii) (requiring a hospital organization
to translate certain documents, among other requirements, to qualify
for a tax-exempt status with respect to a hospital facility); 42 CFR
422.2262(a)(1)-(2) and 422.2264(e) (setting forth Medicare Advantage
marketing requirements, which include requiring Medicare Advantage
organizations to translate marketing materials into non-English
languages spoken by 5% or more of individuals in a plan service
area), Sec. 423.2262(a)(1)-(2) and Sec. 423.2264(e) (setting forth
Medicare Part D marketing requirements, which include requiring Part
D plan sponsors to translate marketing materials into non-English
languages spoken by 5% or more of individuals in a plan service
area); 45 CFR 155.205(c)(2)(iii)(A) (Marketplaces must post taglines
on their websites and include taglines in documents ``critical for
obtaining health insurance coverage or access to health care
services through a QHP''); 45 CFR 147.136(e)(2)(iii) and (e)(3), and
147.200(a)(5) (requiring taglines in languages in which 10% of
individuals with limited English proficiency (LEP) county-wide are
exclusively literate on internal claims and appeals notices and on
an issuer's Summary of Benefits and Coverage); 42 CFR 435.905(b)(3)
(requiring individuals to be ``informed of the availability of
language services . . . and how to access . . . [them] through
providing taglines in non-English languages indicating the
availability of language services''); 42 CFR 457.340(a) (applying
certain Medicaid requirements, including Sec. 435.905(b)(3), which
requires individuals to be ``informed of the availability of
language services . . . and how to access . . . [them] through
providing taglines in non-English languages indicating the
availability of language services''); 210 Illinois Cons. Stat. 87/1
(Illinois Language Assistance Act).
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Second, the Department has heard from multiple stakeholders that
the repetitive nature of the notices and taglines in communications and
publications dilutes the message contained in significant
communications to the point that some recipients may be disregarding
the information entirely.\84\
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\84\ Sources: Aetna, ``Member Reactions to 1557 Taglines'' (Apr.
2017); American Health Insurance Plans and Blue Cross Blue Shield
Association (May 5, 2017); Pharmaceutical Care Management
Association (May 2, 2017).
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Third, the Department has learned that many beneficiaries of
Federal and other health programs do not want to receive extra pages of
information they have seen many times before out of environmental
concerns or annoyance.\85\ Aetna, one of the largest health insurance
issuers in the United States, surveyed 322 enrollees by showing them a
sample document with 4 pages of taglines; 75% of the enrollees reacted
negatively (referring to the taglines as ``wasteful,'' ``confusing,''
``unintelligible,'' ``incomprehensible,'' ``inefficient,'' among
others), 50% said they would be less likely to carefully read documents
from their insurer if they had taglines, and about one third said they
would be less likely to open mail from an insurer if taglines were
included in each document.\86\
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\85\ Sources: Aetna (May 1, 2017); Pharmaceutical Care
Management Association (Mar. 27, 2017); American Health Insurance
Plans and Blue Cross Blue Shield Association (May 5, 2017).
\86\ Source: Aetna, ``Member Reactions to 1557 Taglines'' (Apr.
2017).
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Fourth, the Department has received little evidence of more
beneficiaries seeking language assistance as a result of the
requirements that caused these increased burdens. Health plans report,
anecdotally, that there has been no increase in the number of calls to
their language lines requesting oral interpretation or written
translation services since the notice and tagline requirements became
effective in October 2016.\87\ One plan reported lower numbers after
the tagline requirement--it received 98,800 calls during the period
between January and March 2016, but only 91,800 during the same time
period in 2017.\88\ Since the Final Rule, some pharmacy benefit
managers report having received a handful of calls to their anti-
discrimination grievance line, some have noticed an increase in their
translation line call volume, some have noticed no change in call
volume, and others have seen a decrease, but they report that, as a
group, they have received significantly more complaints about providing
too many notices, as compared to requests for translation
assistance.\89\
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\87\ Sources: Pharmaceutical Care Management Association (Mar.
27, 2017); American Health Insurance Plans and Blue Cross Blue
Shield Association (May 5, 2017).
\88\ Source: Aetna (May 1, 2017).
\89\ Source: Pharmaceutical Care Management Association (Mar.
27, 2017).
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Fifth, the Department has found little evidence showing that
repeatedly mailing all beneficiaries taglines with 15 or more languages
is an efficient use of covered entities' resources when the
overwhelming majority of beneficiaries speak English (with Spanish
being a distant second). According to Census statistics, as of 2015,
over three-quarters (79%) of the U.S. population over age 18 speaks
only English at home, followed by Spanish (12.5%).\90\ Additionally, of
persons selecting a language preference when registering for coverage
on the HealthCare.gov platform for 2017, 89.93% selected English,
followed by 8.36% who selected Spanish.\91\ This data suggests that,
for the large majority of people who receive them, the required
language tagline mailings provide little to no benefit (and potentially
impose burdens) because they are already proficient English speakers
with little need for, and no entitlement under the law to, translation
services.
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\90\ U.S. Census Bureau, American FactFinder, ``B16007: Age by
Language Spoken at Home for the Population 5 Years and Over,'' 2011-
2015 American Community Survey (2017), https://factfinder.census.gov/bkmk/table/1.0/en/ACS/16_5YR/S1601/0100000US.
\91\ CMS, ``Race, Ethnicity, and Language Preference in the
Health Insurance Marketplaces 2017 Open Enrollment Period,'' (April
2017), https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Data-Highlight-Race-Ethnicity-and-Language-Preference-Marketplace.pdf. California and New York were not included in the
analysis as they do not use the HealthCare.gov platform.
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Sixth, confusion over the notices has resulted in an increased
volume of mistaken inquiries on the Department's public phone line.\92\
OCR's toll-free
[[Page 27860]]
phone number, available to file civil rights complaints, is listed at
the bottom of the Notice of Nondiscrimination. See Appendix A to Part
92 (Sample Notice Informing Individuals About Nondiscrimination and
Accessibility Requirements and Sample Nondiscrimination Statement:
Discrimination Is Against the Law). However, recipients of the notices
often misunderstand it to be the phone number to call when they have
questions to ask their health insurance issuer or health care provider.
The majority of phone calls to the OCR complaint line do not concern
civil rights matters at all. This experience indicates that many
members of the public do not fully read the non-discrimination notice
or are confused because it is attached to other information sent to
them by their providers or issuers. The result has been a significant
waste of OCR resources with respect to its complaint line and a
commensurate waste of time for callers.
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\92\ Between November 26, 2018 and April 2, 2019, OCR's Call
Center received 983 calls on the complaint line from individuals who
actually wanted to speak to their insurance company, not OCR, in
order to raise billing questions, report a change of address,
request a replacement insurance card, seek a reimbursement check, or
make a payment.
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The Department's proposal to substantially replace the Section 1557
Regulation with the existing framework for protection of civil rights
laws, while expressly addressing language access issues in this
proposed rule, will better strike the balance between the government's
interest in ensuring meaningful access to covered healthcare programs
for LEP individuals and the burdens imposed on regulated entities in
support of that interest.
III. Nondiscrimination in Health Programs or Activities
This proposed rule would substantially replace the Section 1557
Regulation. The provisions proposed for retention, revision, and repeal
are as follows:
A. Provisions of the Proposed Section 1557 Rule at 45 CFR Part 92
The proposed rule would more faithfully fulfill the Department's
congressional mandate. In Section 1557 of the PPACA, Congress applied
long-standing nondiscrimination requirements to any health programs or
activities that receive Federal financial assistance, or programs or
activities administered by an Executive agency under Title I of the
PPACA or any entity established under such Title I. It did so by cross-
referencing the categories of protected classifications listed in those
longstanding civil rights laws, namely, discrimination on the basis of
race, color, national origin, sex, age, or disability. To ensure
compliance, Congress dictated that ``[t]he enforcement mechanisms
provided for and available under'' such laws ``shall apply for purposes
of violations of'' Section 1557. The Department now proposes to fulfill
this Congressional mandate by applying the enforcement mechanisms
already provided for, and available under, existing statutes and their
implementing regulations, including the rights and remedies under such
laws.
Based on its review, and the preliminary injunction issued by the
court in Franciscan Alliance that held parts of the Final Rule exceeded
the Department's authority under the PPACA, the Department has
determined that (in addition to exceeding its statutory authority)
parts of the regulation are duplicative, unduly burdensome, and
confusing to the regulated community. This proposed rule, accordingly,
would substantially replace 45 CFR part 92 with provisions in keeping
with the plain language of Section 1557, while continuing to codify
certain provisions regarding covered entities' obligations with respect
to language and disability access. This will ensure better compliance
with the mandates of Congress, avoid further litigation, relieve
regulatory burdens, reduce confusion, reduce uncertainty about the
scope of Section 1557, promote substantive compliance, and improve the
consistency of regulatory requirements between entities required to
comply with the civil rights laws as a result of Section 1557 and those
directly subject to only to the underlying civil rights laws.
The proposed rule would be divided into two subparts: Subpart A on
General Provisions (consistent with the current regulation), and
Subpart B on Specific Applications to Health Programs or Activities.
The Department proposes to replace Sec. Sec. 92.1 through 92.3, 92.5,
92.6, and 92.101 of the current rule with provisions addressing Section
1557's purpose, nondiscrimination requirements, scope of application,
enforcement mechanisms, relationship to other laws, and meaningful
access for LEP individuals.
The Department's proposal does not change the provision to submit
assurances of compliance with Section 1557 at Sec. 92.5, designated as
Sec. 92.4. In addition, the Department would retain, but redesignate
(to adjust to the proposed restructuring in the rule) the provisions on
voluntary acceptance of language assistance services (Sec. 92.201(g)),
effective communication for individuals with disabilities (Sec.
92.202), accessibility of buildings and facilities (Sec. 92.203),
accessibility of information and communication technology (Sec.
92.204), and the requirement to make reasonable modifications (Sec.
92.205).
Although the proposed rule would eliminate the definitions section
in the Section 1557 Regulation, the Department proposes to retain many
key definitions explicitly in other sections or through incorporation
by reference to relevant statutes or regulations. For example, as
discussed below, proposed Sec. 92.3 (Scope of application) will define
the scope of ``health program or activity.'' Proposed Sec. 92.3 also
effectively defines ``covered entities'' similar to the Final Rule by
clarifying that the rule applies to: (1) Every health program or
activity, any part of which is receiving Federal financial assistance
(including credits, subsidies, or contracts of insurance) provided or
made available by the Department; (2) any program or activity
administered by the Department under Title I of the PPACA; or (3) any
program or activity administered by any entity established under such
Title. Furthermore, consistent with the text of Section 1557, proposed
Sec. Sec. 92.2 and 92.3 provide that ``Federal financial assistance''
includes credits, subsidies, or contracts of insurance.
The proposed rule uses the same characteristics as are included in
the definitions of ``qualified interpreter'' for an LEP individual and
of ``qualified translator'' in describing the requirements that an
interpreter and translator, respectively, should meet (but omits the
word ``qualified'' which is implied by the context). See proposed Sec.
92.101(b)(3)(i) and (ii). The proposed rule also retains nearly
verbatim, as requirements with respect to the provision of language
access services, the characteristics used to define ``language
assistance services.'' See proposed Sec. 92.101(b)(2).
Additionally, the proposed rule retains most of the disability-
rights related definitions from the current rule either explicitly,
such as the definitions of ``disability'' and ``information and
communication technology;'' by using the definition to describing the
requirements or characteristics of the entity, such as when describing
a ``qualified interpreter'' for an individual with a disability; or by
referencing underlying regulations or statutes, such as for technical
accessibility standards and definitions.
In other cases, some terms are clear enough to obviate the need for
further definition given the context of the proposed rule including
terms such as ``age,'' ``individual with limited English
[[Page 27861]]
proficiency,'' ``qualified bilingual/multilingual staff,'' or
``individual with a disability.'' In these examples, OCR will continue
to interpret the phrases naturally and consistent with the Final Rule.
The Department will also continue to abide by terms defined in the
definitions sections of the implementing regulations for the underlying
statutes. In fact, the Department believes it is generally more
appropriate to rely on individual definitions applicable to individual
statutes incorporated into Section 1557 as opposed to picking one
standard (or creating a new one) and making it applicable in all cases,
as under the Final Rule.
The Department asks for comment on whether other definitions should
be included in the regulatory text.
Redesignation Table
------------------------------------------------------------------------
Old section New section
------------------------------------------------------------------------
92.201(g)................................. 92.101(c)
92.202.................................... 92.102
92.203.................................... 92.103
92.204.................................... 92.104
92.205.................................... 92.105
------------------------------------------------------------------------
The remaining provisions of Section 1557 would be repealed. A
description of each proposed provision of the Section 1557 Regulation
follows:
Proposed ``Subpart A--General Provisions''
Proposed ``45 CFR 92.1 Purpose.''
This proposed section describes the purpose of the proposed
regulation as providing for the enforcement of Section 1557, which
prohibits discrimination under any health program or activity receiving
Federal financial assistance, or under any program or activity
administered by an Executive agency under Title I of the PPACA or by
any entity established under such Title, on the grounds of race, color,
national origin, sex, age, or disability. The proposed section would
provide that the Department's Office for Civil Rights (OCR) enforces
these prohibitions using the mechanisms set forth in the Department's
Title VI, Title IX, Age Act, and Section 504 regulations. The proposed
section would replace the current Sec. 92.1 in its entirety.
Proposed ``45 CFR 92.2 Nondiscrimination requirements.''
This proposed section describes the core substantive requirements
of compliance with Section 1557 under the proposed regulation. Namely,
the Department proposes to provide that, except as otherwise provided
by Title I of the PPACA, an individual shall not be excluded from
participation in, be denied the benefits of, or be subjected to
discrimination under, any health program or activity, any part of which
is receiving Federal financial assistance (including credits,
subsidies, or contracts of insurance) provided by the Department, or
under any program or activity administered by the Department under such
Title, or under any program or activity administered by any entity
established under such Title, on any grounds prohibited under the
following statutes:
(1) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et
seq.) (race, color, national origin);
(2) Title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et
seq.) (sex);
(3) The Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.)
(age); or
(4) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794)
(disability).
The cross-reference to existing civil rights statutes does not
change the prohibited grounds of discrimination, but applies them, to
the extent they did not already apply, to the health care context.
Thus, for example, the cross-referencing of Title IX (which prohibits
sex discrimination in education programs or activities) in Section 1557
and in the proposed regulation means that sex discrimination, as
defined by Title IX, is prohibited in health programs or activities to
which this proposed part applies, not merely health programs or
activities related to education. This proposed section would replace
current Sec. 92.2 in its entirety.
In keeping with the text of Section 1557, proposed Sec. 92.2 would
apply to health programs or activities receiving Federal financial
assistance, ``including credits, subsidies, or contracts of
insurance.''
Although Section 1557 prohibits discrimination by any program
``administered by an Executive Agency,'' the Final Rule itself
acknowledged the difficulty of the Department enforcing the rule with
respect to programs administered by other agencies.\93\ Many other
agencies have their own rules implementing the underlying statutes
incorporated in section 1557. See, e.g., 65 FR 52857 (Title IX common
rule for 21 Federal agencies). HHS, therefore, proposes to continue the
general limitation on the rule's scope found in the Final Rule,
specifically, that the proposed rule not assert or encompass
enforcement jurisdiction over entities receiving Federal financial
assistance administered by another agency under Section 1557.
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\93\ In the preamble to the Final Rule, the Department
acknowledged its limited ability to regulate programs covered by
other agencies. 81 FR 31379 (``Drafting a rule applicable to health
programs and activities assisted by other Departments would pose
numerous challenges'').
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The current regulation, however, departed from this general
principle by defining Federal financial assistance to include
assistance that HHS ``does not have primary responsibility for
administering,'' but merely ``plays a role'' in providing or
administering. 81 FR 31384; 45 CFR 92.4. This gloss goes beyond the
text of Section 1557, which, in relevant part, only covers certain
programs or activities ``administered'' by the Department, not any
program in which the Department ``plays a role in administering.'' In
keeping with the text of Section 1557, the proposed regulation would
not retain the ``plays a role'' language. As a result, the proposed
rule would no longer cover issuers of Exchange plans solely on the
basis that HHS plays a role in administering tax credits, also
administered by the Internal Revenue Service.\94\ Exchange plans,
however, may still be subject to antidiscrimination enforcement by the
Department under Section 1557 on other grounds, or under other
antidiscrimination authorities. For example, qualified health plans
(QHPs) sold on the Exchanges established under Title I of the PPACA are
subject to Section 1557, and the issuers of QHPs are subject to
regulation by the Department's Center for Consumer Information and
Insurance Oversight, of the Centers for Medicare & Medicaid Services.
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\94\ In the preamble to the Final Rule, the Department
acknowledged its limited ability to regulate programs covered by
other agencies. 81 FR 31379 (``Drafting a rule applicable to health
programs and activities assisted by other Departments would pose
numerous challenges''). Additionally, the Department has not applied
the Final Rule to the risk adjustments program (Section 1343 of the
PPACA), and does not propose to do so in this proposed rule. See
also 45 CFR 153.310 (risk adjustment administration).
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The Department seeks specific comment on the proposed elimination
of the ``plays a role'' language.
The Final Rule applies to ``every health program or activity
administered by the Department; and every health program or activity
administered by a Title I entity.'' 45 CFR 92.2. But Section 1557, with
respect to the administration of programs by the Department and PPACA's
Title I entities, does not include the term ``health.'' Rather Section
1557 applies to ``any program or activity'' administered by the
Department or any entity established under Title I of the PPACA.
[[Page 27862]]
The Department added the health limitation to the current rule
because it did not believe Section 1557 was intended to apply to every
program or activity administered by every Executive agency whether or
not it had any relation to health. Accordingly, the preamble to the
Final Rule stated it covered health programs administered by CMS, HRSA,
CDC, Indian Health Service (IHS), and SAMHSA (for example, IHS tribal
hospitals and clinics operated by the Department and the National
Health Service Corps) but not any human services programs administered
by the Department. 81 FR 31446. The Department continues to believe
that Congress did not provide such expansive coverage, but believes
that Section 1557 itself already provides a meaningful limitation
without resort to inserting the word ``health'' when Congress did not
do so, Section 1557 specifies that it applies to any program or
activity administered by the Department (or other Executive Agency)
``under this title,'' meaning Title I of the PPACA. To be consistent
with the text as passed by Congress, the proposed Sec. 92.2 would
apply to any program or activity administered by the Department under
Title I of the PPACA and any program or activity administered by any
entity established under such Title. Entities established under Title I
of the PPACA include the health insurance exchanges established
pursuant to the PPACA. Such exchanges currently include the 12 State
Exchanges, 5 State Exchanges on the Federal platform, and 34 Federally-
facilitated Exchanges. Title I additionally establishes, among other
things, State advisory councils concerning community health insurance
(section 1323).
The Department seeks public comment on the impact of this language,
including on mechanisms for identifying affordable health insurance
coverage options (Sec. 1103), the wellness program demonstration
project (Sec. 1201, adding Public Health Service (PHS) Act Section
2705(l)), and the provision of community health insurance options (Sec.
1323).
Proposed ``45 CFR 92.3 Scope of application.''
This proposed section would clarify that the scope of application
of the proposed rule would be consistent with the Civil Rights
Restoration Act (CRRA), which defined the scope of the underlying civil
rights laws based on whether or not an entity receiving Federal
financial assistance is or is not principally engaged in the business
of providing health care.
Proposed Sec. 92.3 clarifies the scope of entities covered by the
rule by specifying that the rule applies to: (1) Any health program or
activity, any part of which is receiving Federal financial assistance
(including credits, subsidies, or contracts of insurance) provided by
the Department; (2) any program or activity administered by the
Department under Title I of the PPACA; or (3) any program or activity
administered by any entity established under such Title. Furthermore,
as provided in Section 1557 of the PPACA \95\ and in proposed Sec.
92.2, the Department interprets ``Federal financial assistance'' in the
proposed rule to apply to credits, subsidies, or contracts of
insurance.
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\95\ 42 U.S.C. 18116(a) (Section 1557 applies to recipients of
Federal financial assistance for contracts of insurance).
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With respect to entities receiving Federal financial assistance,
the current regulation defines the operation of a ``health program or
activity'' to cover ``all [ ] operations'' of such entities when they
are principally engaged in providing or administering ``health services
or health insurance coverage or other health coverage.'' 45 CFR 92.4.
The CRRA, however, defined ``program or activity'' under Title VI, the
Rehabilitation Act, the Age Act, and Title IX to cover all the
operations of entities only when they are ``principally engaged in the
business of providing education, health care, housing, social services,
or parks and recreation.'' Public Law 100-259, 102 Stat. 28 (Mar. 22,
1988) (emphasis added).
``Health insurance'' is distinct from ``health care.'' Compare 5
U.S.C. 5371 (```health care''' means direct patient-care services or
services incident to direct patient-care services'') with 42 U.S.C.
300gg-91 (``The term `health insurance coverage' means benefits
consisting of medical care (provided directly, through insurance or
reimbursement, or otherwise and including items and services paid for
as medical care) under any hospital or medical service policy or
certificate, hospital or medical service plan contract, or health
maintenance organization contract offered by a health insurance
issuer.'').\96\ The Final Rule, however, went beyond the CRRA by
covering all the operations of entities that are principally engaged in
providing ``health insurance coverage or other health coverage,'' even
if they are not principally engaged in the business of providing
``health care,'' despite there being nothing in Section 1557 indicating
any abrogation--or extension--of the CRRA.\97\
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\96\ See also 45 CFR 160.103 (HIPAA administrative
simplification) (``Health care means care, services, or supplies
related to the health of an individual. Health care includes, but is
not limited to, the following: (1) Preventive, diagnostic,
therapeutic, rehabilitative, maintenance, or palliative care, and
counseling, service, assessment, or procedure with respect to the
physical or mental condition, or functional status, of an individual
or that affects the structure or function of the body; and (2) Sale
or dispensing of a drug, device, equipment, or other item in
accordance with a prescription.'').
\97\ The preamble to the Final Rule acknowledges the relevance
of the CRRA, 81 FR at 31386, but does not explain how the provision
of ``health care'' covers the provision of ``health insurance, even
if only part of the health program or activity receives such
assistance.''
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Therefore, to provide further clarity on these issues and return to
the CRRA's statutory text, proposed Sec. 92.3 would explicitly
incorporate the CRRA standard. The Department also believes this
approach is an appropriate interpretation of the phrase ``health
program or activity.'' If an entity is principally engaged in the
business of health care, the Department proposes to interpret Section
1557 so that all operations of that entity would be deemed part of any
``program or activity'' it engages in, any part of which receives
Federal financial assistance. If, on the other hand, an entity is not
principally engaged in the business of health care, the Department
proposes to interpret Section 1557 so that only the operation for which
it receives Federal financial assistance is part of the ``program or
activity.''
Specifically, the proposed section would set forth the general
applicability standard from Section 1557: That it applies to any health
program or activity, any part of which is receiving Federal financial
assistance administered by the Department, including credits,
subsidies, or contracts of insurance, or under any program or activity
that is administered by the Department or any entity established under
Title I of the PPACA.
Further, the Department proposes that Sec. 92.3 provide that the
regulation would cover all of the operations of any entity that
receives Federal financial assistance from the Department and that is
principally engaged in the business of providing health care, as part
of a ``health program or activity.'' For any entity not principally
engaged in the business of providing health care, ``health program or
activity'' under the proposed regulation would apply to such entity's
operations only to the extent any such operations receive Federal
financial assistance.
Finally, the proposed section would clarify that, for purposes of
the rule, an entity principally or otherwise engaged in the business of
providing health insurance shall not, by virtue of such
[[Page 27863]]
provision, be considered to be principally engaged in the business of
providing health care.
The proposed regulation would not apply to entities that do not
receive Federal financial assistance from the Department. Likewise, as
discussed above concerning the CRRA, the Department proposes that where
entities receive Federal financial assistance but are not principally
engaged in the business of providing health care, the regulation would
not apply to the components or activities of those entities that do not
receive Federal financial assistance. If an entity, such as a health
insurance issuer, receives Federal financial assistance from the
Department to further a health program or activity but is not
principally engaged in the business of providing health care, the
proposed regulation would apply to the entity's specific operations
which receive Federal financial assistance from the Department, but it
would not apply to the entity's entire operations.\98\ Thus, for
example, the proposed rule would generally not apply to short term
limited duration insurance (STLDI) because, as the Department
understands it, providers of STLDI are either (1) not principally
engaged in the business of health care, or (2) not receiving Federal
financial assistance with respect to STLDI plans specifically.\99\
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\98\ Compare with Grove City College v. Bell, 465 U.S. 555
(1984) (holding that receipt of Federal financial aid does not
automatically trigger institution-wide coverage under Title IX)
abrogated in part by the CRRA.
\99\ The Public Health Service Act expressly excludes STLDI from
its definition of ``individual health coverage,'' and the PPACA does
not deem short term limited duration insurance to be qualifying
coverage under the PPACA's minimum essential coverage requirements.
42 U.S.C. 300gg-91(b)(5); 26 U.S.C. 5000A; see also 83 FR 38212
(Aug. 3, 2018) (rule clarifying definition of short-term, limited-
duration insurance to Departments of Treasury, Labor, and Health and
Human Services regulations at 26 CFR 54.9801-2, 29 CFR 2590.701-2,
and 45 CFR 144.103).
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Under the proposed section, examples of entities principally
engaged in the business of providing health care would include
hospitals, nursing facilities, hospices, community health centers, and
physical therapists. Examples of recipients of Federal financial
assistance from the Department for health programs or activities would
include laboratories, medical schools, and nursing schools. Examples of
recipients of Department assistance for contracts of insurance would
include Medicare Part C (Medicare Advantage).
The proposed rule would not apply to Medicare Part B (except to the
extent participation in a health care program is required for engaging
in other operations),\100\ or self-funded group health plans under the
Employee Retirement Income Security Act of 1974 (ERISA), Federal
Employees Health Benefits (FEHB) Program, or STLDI plans because (or to
the extent) such programs do not receive Federal financial assistance
from HHS and/or the entities operating them are not principally engaged
in the business of providing health care as discussed above.
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\100\ The Department believes that the Federal financial
assistance does not include Medicare Part B under the Social
Security Act. See 2 CFR 200.40(c) (Uniform Administrative
Requirement, Cost Principles, and Audit Requirements for Federal
Awards); 45 CFR 75.502(h) (Uniform Administrative Requirement, Cost
Principles, and Audit Requirements for HHS Awards).
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The Department seeks public comment on issues related to the scope
of coverage under the proposed rule, including whether it should define
``health care'' in the rule according to the statutes cited above
defining the term, whether it should define ``recipient'' according to
the current rule or by incorporation by reference to definitions in the
underlying statutes, and whether such a definition of recipient should
include subrecipients.
Proposed ``45 CFR 92.4 Assurances.''
The Department contemplates retaining current Sec. 92.5, requiring
covered entities to submit an assurance of compliance with Section 1557
to the Department without change, but proposes to redesignate it as
Sec. 92.4. Paragraph (a) requires applicants for the Department's
Federal financial assistance for health programs or activities, health
insurance issuers seeking certification to participate in an Exchange,
and States seeking approval to operate State Exchanges to submit
assurances that the health program or activity will comply with Section
1557 and its regulation. Paragraph (b) clarifies that assurances of
compliance with Section 1557 apply to the period during which Federal
financial assistance is extended, or the applicable property is used,
owned or possessed. Paragraph (c) requires that assurances with Section
1557 must be contained in covenants running with applicable property,
interest, and land transfers from the Department. The source of these
provisions is the Department's Section 504 regulations, and while
Section 504 regulations have more detail, they do not have major
substantive requirements that differ from their Title IX, Title VI, or
Age Act regulations.\101\
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\101\ Compare 45 CFR 84.5 (Section 504) with 45 CFR 86.4 (Title
IX), 80.4(a) (Title VI), 91.33 (Age Act).
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The Department proposes to retain the assurance provisions and
identify ``Section 1557'' on a consolidated assurance form with Title
VI, Title IX, Section 504, and the Age Act to include major applicable
civil rights laws and require all applicable covered entities to submit
the assurance. The Department believes keeping Section 1557 on a
consolidated form ensures that the insurance industry and States are
aware that these Federal civil rights laws currently apply to them.
The Department seeks comment on whether it is appropriate to retain
the requirement to submit an assurance of compliance with Section 1557
to the Department, or whether it unnecessarily duplicates requirements
in the underlying regulations to provide such assurances of compliance
to the Department.
Proposed ``45 CFR 92.5 Enforcement mechanisms.''
This proposed section would ensure that even under the proposed
rule's repeal of certain provisions of the Section 1557 Regulation, the
enforcement mechanisms provided for, and available under, Title VI of
the Civil Rights Act of 1964, Title IX of the Education Amendments of
1972, the Age Discrimination Act of 1975, or Section 504 of the
Rehabilitation Act of 1973, and the Department's implementing
regulations, shall apply for purposes of enforcement of Section 1557.
Other than as proposed in the conforming amendments discussed in Part
IV, the proposed rule would not repeal or otherwise amend the
regulations implementing and enforcing Title VI at 45 CFR parts 80 and
81, Title IX at 45 CFR part 86, Section 504 at 45 CFR parts 84 and 85,
and the Age Act at 45 CFR parts 90 and 91.
The proposed Sec. 92.5 also designates the Director of the
Department's Office for Civil Rights to receive complaints, conduct
compliance reviews, and otherwise investigate and take enforcement
actions with respect to allegations of discrimination in violation of
Section 1557 under this part.\102\
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\102\ The Office of Personnel Management (OPM) handles of claims
alleging discrimination in the Federal Employees Health Benefits
(FEHB) Program. OPM is charged by Federal statute with offering FEHB
plans as a fringe benefit of Federal employment and, in that role,
approves benefit designs and premium rates, sets rules generally
applicable to FEHB carriers, adjudicates and orders payment of
disputed health claims, and adjusts policies as necessary to ensure
compliance with nondiscrimination standards.
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[[Page 27864]]
Proposed ``45 CFR 92.6 Relationship to other laws.''
The Department proposes Sec. 92.6, to define the relationship of
the regulation to other laws with more specificity than the current
sections titled ``Application'' (Sec. 92.2) and ``Relationship to
other laws'' (Sec. 92.3). The Department proposes to combine the
substance of these two sections into a new Sec. 92.6. It would set
forth the text of Section 1557(b) nearly verbatim, and state that
nothing in the proposed regulation shall be construed to invalidate or
limit the rights, remedies, procedures, or legal standards available to
individuals aggrieved under Title VI of the Civil Rights Act of 1964,
Title VII of the Civil Rights Act of 1964, Title IX of the Education
Amendments of 1972, the Age Discrimination Act of 1975, or Section 504
of the Rehabilitation Act of 1973, or to displace additional
protections under State antidiscrimination laws.
The proposed section would also specify that the proposed
regulation not be applied in a manner that conflicts with or supersedes
exemptions, rights, or protections contained in several civil rights
statutes, including those just mentioned, the Architectural Barriers
Act of 1968,\103\ the Americans with Disabilities Act of 1990 (as
amended by the Americans with Disabilities Act Amendments Act of
2008),\104\ Section 508 of the Rehabilitation Act of 1973,\105\ and
statutes protecting conscience and religious freedom.
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\103\ 42 U.S.C. 4151 et seq.
\104\ 42 U.S.C. 12181 et seq.
\105\ 29 U.S.C. 794d.
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Although the Section 1557 Regulation incorporated exemptions to
Title VI, Section 504, and the Age Act,\106\ it did not incorporate
abortion,\107\ religious,\108\ and other \109\ exemptions contained in
Title IX. The Final Rule considered the question of explicitly
incorporating the Title IX religious exemption in the Section 1557
Regulation, but declined, instead providing that, ``[i]nsofar as the
application of any requirement under this part would violate applicable
Federal statutory protections for religious freedom and conscience,
such application shall not be required.''
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\106\ See 45 CFR 92.101(c) (The exceptions applicable to Title
VI apply to discrimination on the basis of race, color, or national
origin under this part. The exceptions applicable to Section 504
apply to discrimination on the basis of disability under this part.
The exceptions applicable to the Age Act apply to discrimination on
the basis of age under this part. These provisions are found at
Sec. Sec. 80.3(d), 84.4(c), 85.21(c), 91.12, 91.15, and 91.17-.18
of this Subchapter.'')
\107\ ``Nothing in this title shall be construed to require or
prohibit any person, or public or private entity, to provide or pay
for any benefit or service, including the use of facilities related
to an abortion . . . .'' Public Law 100-259, 102 Stat. 28 (Mar. 22,
1988) (codified at 20 U.S.C. 1688).
\108\ 20 U.S.C. 1681(a)(3) (providing that the prohibition of
discrimination on the basis of sex ``shall not apply to an
educational institution which is controlled by a religious
organization if the application of this subsection would not be
consistent with the religious tenets of such organization''); see
also 45 CFR 86.12 (Title IX exemption for educational organizations
controlled by religious organizations).
81 FR 31435 (HHS declines to include a religious exemption in
Section 1557).
\109\ 20 U.S.C. 1681(a)(6)(B) (Title IX exemption for voluntary
youth service organizations); 1686 (separate living facilities); 45
CFR 86.33 (exemption for separate toilet, locker room, and shower
facilities).
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The Franciscan Alliance court stated that the Department's failure
to incorporate statutory exemptions ``nullifies Congress's specific
direction to prohibit only the ground proscribed by Title IX.''
Franciscan Alliance, 227 F. Supp. 3d at 690-691 (citations omitted).
The Franciscan Alliance court held that there was a likelihood that
plaintiffs would prevail on the claim that ``[t]he Rule's failure to
include Title IX's religious exemptions renders the Rule contrary to
law.'' \110\
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\110\ 227 F. Supp. 3d at 690-91.
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In its April 5, 2019, brief in Franciscan Alliance, DOJ, on behalf
of HHS, stated that the prohibition on sex discrimination under Section
1557 ``unambiguously includes Title IX's exemptions, including those
addressing religion and abortion.'' \111\ This statement represents the
Department's own further consideration of this issue, guided by DOJ's
pronouncements on Title VII and Title IX. The Department believes that
its enforcement of Title IX, and its enforcement of Section 1557 (to
the extent it incorporates Title IX), must be constrained by the
statutory contours of Title IX, which include explicit abortion and
religious exemptions and which should be set forth more clearly than in
the Final Rule.\112\
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\111\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O, p. 11 (N.D. Tex, filed April 5, 2019).
\112\ As discussed further below, HHS also proposes to amend its
underlying Title IX regulation to include the statutory abortion and
religious exemptions explicitly.
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In the Department's view, Section 1557 did not override any
statutes protecting conscience or civil rights, and the exemptions
thereto, and it is appropriate to specify that the Section 1557
Regulation will not be implemented in violation of those laws. Indeed,
Section 1303 of the PPACA states that nothing in the PPACA shall be
construed to require qualified health plans to cover abortions as an
essential health benefit (42 U.S.C. 18023(b)(1)(A)(i)) and ``[n]othing
in this Act shall be construed to have any effect on Federal laws
regarding--(i) conscience protection; (ii) willingness or refusal to
provide abortion; and (iii) discrimination on the basis of the
willingness or refusal to provide, pay for, cover, or refer for
abortion or provide or participate in training to provide abortion''
(42 U.S.C. 18023(c)(2)(A)). With respect to Section 1303 of the PPACA,
this language is contained in a provision labeled ``NO EFFECT ON
FEDERAL LAWS REGARDING ABORTION'' and is in a section that dealing with
``special rules'' about abortion. However, the language (``conscience
protections'') is not limited to abortion.
In light of the PPACA's text and structure and the experience of
the Franciscan Alliance litigation, the proposed section would
incorporate by reference statutory exemptions and protections
concerning religious and abortion exemptions with greater clarity than
the Final Rule's Sec. 92.2(b)(2) which currently states that,
``[i]nsofar as the application of any requirement under this part would
violate applicable Federal statutory protections for religious freedom
and conscience, such application shall not be required.''
This current provision would be amended and replaced by the
proposed Sec. 92.6 which provides that, ``[i]nsofar as the application
of any requirement under this part would violate, depart from, or
contradict definitions, exemptions, affirmative rights, or protections
provided by any of the[se] statutes [ ] . . . or any related,
successor, or similar Federal laws or regulations, such application
shall not be imposed or required.''
Additionally proposed Sec. 92.6 would explicitly identify and
incorporate protections from specific religious freedom, conscience,
and nondiscrimination statutes--42 U.S.C. 18113 (Section 1553 of the
Patient Protection and Affordable Care Act); 42 U.S.C. 2000bb et seq.
(the Religious Freedom Restoration Act, which applies to ``all Federal
law . . . unless such law explicitly excludes such application''); 42
U.S.C. 238n (the Coats-Snowe Amendment); 42 U.S.C. 300a-7 (the Church
Amendments); the Weldon Amendment (e.g., Consolidated Appropriations
Act of 2019, Pub. L. 115-245, Div. B, sec. 506(d) (Sept. 28, 2018));
and related conscience provisions in appropriations law (e.g.,
Consolidated Appropriations Act of 2019, Pub. L. 115-245, Div. B. sec.
506) (Sept. 28, 2018)).
[[Page 27865]]
Proposed ``Subpart B--Specific Applications''
Proposed ``45 CFR 92.101 Meaningful access for individuals with limited
English proficiency''
The Department proposes to redesignate Sec. 92.201, on providing
meaningful access for individuals with limited English proficiency
(LEP), as Sec. 92.101 and, as so redesignated, to amend the provision
to more closely align with the Department's 2003 LEP guidance.
In proposed paragraph (a), the Department sets forth the governing
standard for the provision of meaningful access to programs and
activities receiving Federal financial assistance based on the U.S.
Supreme Court decision of Lau v. Nichols, 414 U.S. 563 (1974), which
interprets Title VI's prohibition of discrimination on the basis of
``national origin'' in the context of LEP individuals. Subsection (a)
also incorporates language from the Department of Justice's and HHS's
LEP guidance documents. See 67 FR 41455 (June 18, 2002) (DOJ Guidance
to Federal Financial Assistance Recipients Regarding Title VI
Prohibition Against National Origin Discrimination Affecting Limited
English Proficient Persons); 68 FR 47311 (Aug. 8, 2003) (HHS Guidance
to Federal Financial Assistance Recipients Regarding Title VI
Prohibition Against National Origin Discrimination Affecting Limited
English Proficient Persons).
Proposed paragraph (a) would adopt the standard from DOJ's and
HHS's LEP guidance by specifying that any entity operating or
administering a health program or activity subject to this rule shall
take reasonable steps to ensure meaningful access to such programs or
activities by limited English proficient individuals. Because Section
1557 applies to a broader scope of entities than only recipients of
federal financial assistance, the Department proposes to use ``entity''
rather than ``recipient'' which retains the nomenclature used in the
current rule with respect to LEP access.
Adopting this language would apply the same standard to both health
and human services within the Department, and conform to the other
Federal agencies who follow DOJ's LEP guidance, consistent with its
civil rights coordinating authority. This standard is also consistent
with Department's LEP guidance.\113\ This provision is proposed to
replace the current rule's provision which requires that reasonable
steps to provide meaningful access be provided to each LEP individual
eligible to be served or likely to be encountered.\114\
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\113\ 68 FR 47312 (Aug. 8, 2003) (HHS LEP guidance) (stating
that ``Title VI and its implementing regulations require that
recipients take reasonable steps to ensure meaningful access by LEP
persons.'' See also 67 FR 41455 (June 18, 2002) (DOJ LEP Guidance);
Executive Order 13166 on Improving Access to Services for Persons
with Limited English Proficiency, 65 FR 50121 (Aug. 16, 2000)
(directing all Federal agencies to develop LEP guidance consistent
with DOJ's LEP guidance).
\114\ 45 CFR 92.201(a). But see 68 FR 47312, 47314 (Aug. 8,
2003) (HHS LEP guidance) (stating that recipients may conclude that
``in certain circumstances'' recipient-provided language services
are not necessary).
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Proposed paragraph (b) would likewise adopt the four factors from
the Department's existing LEP guidance to assist entities in
determining the extent of a covered entity's obligation to provide
language assistance services. The Department proposes to clarify that
the starting point for OCR's exercise of its enforcement discretion
would be an individualized case-by-case assessment that balances the
following four factors: (1) The number or proportion of LEP individuals
eligible to be served or likely to be encountered in the eligible
service population; (2) the frequency with which LEP individuals come
in contact with the entity's health program, activity, or service; (3)
the nature and importance of the entity's health program, activity, or
service; and (4) the resources available to the entity and costs. 68 FR
at 47314-15 (HHS guidance); accord 67 FR at 41459-60 (factors from
DOJ's 2002 LEP guidance).\115\ By using the factors as written in the
Department's LEP Guidance, the proposed rule would use the same factors
in health care that already apply to all of the Department's programs,
including human services.
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\115\ The Department notes that, in both its LEP guidance and in
the Department of Justice's LEP guidance, language in factor (1)
also refers to LEP persons rather than individuals, refers to the
number of those persons served or encountered rather than those
eligible to be served or likely to be encountered, and refers to
those served or encountered by the program or grantee rather than in
the eligible service population. . Likewise, language in factor (3)
refers to the nature and importance of the program, activity, or
service provided by the program to people's lives. The Department
believes that these variations in descriptions of the factors have
the same meaning, but asks for comment on which formulation of these
factors it should use for purposes of this rulemaking.
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Although the current Section 1557 Regulation states that it applies
to individuals ``eligible to be served or likely to be encountered,''
\116\ it did not explicitly address factors such as the number or
proportion of LEP individuals, the frequency of contact, the resources
available, or the costs identified in the Department's LEP
guidance.\117\ Additionally the Final Rule newly required the OCR
Director to take into account whether a covered entity had developed
and implemented an effective written language access plan in evaluating
compliance.\118\ By contrast, the HHS LEP Guidance had stated that
``[r]ecipients with very few LEP persons and recipients with very
limited resources, may choose not to develop a written LEP plan.'' 68
FR 47320. The Department also stated in its guidance that recipients
have ``alternative and reasonable ways to articulate'' how they are
providing meaningful access to LEP individuals besides through written
language access plans. Id.
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\116\ 45 CFR 92.201(a).
\117\ But see 45 CFR 92.201(b) (including a catchall allowing
the Director to ``take into account other relevant factors'').
\118\ See 45 CFR 92.201(a).
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Because of these departures from the Department's LEP guidance, the
Department anticipated that 50% of covered entities would develop
language access plans subsequent to the finalization of the Section
1557 Regulation, amounting to a total annualized cost of $84.1 million
over five years (undiscounted). 81 FR 31459.
The Department seeks comment on this proposed provision with
respect to how health care providers would articulate their
responsibilities under the proposed rule and comment on any related
costs or cost savings.
Next, the Department retains Sec. 92.201(c) through (e) and (g)
from the current rule, but proposes to redesignate these provisions as
Sec. 92.101(b)(2) through (4) and (c), with the proposed clarifying
revision that these obligations, which are applicable to specific
language services, would apply only to the extent necessary to comply
with the standard articulated in (a) (which is consistent with the HHS
LEP guidance), as informed by the entity's individualized assessment of
the four factors. In general, language assistance services, if required
to be offered by an entity, must be no-cost, timely, and accurate. If
the standard requires an entity to offer translators or interpreters,
they must also meet specific minimum qualifications, including ethical
principles, confidentiality, proficiency, effective interpretation, and
ability to use specialized terminology as necessary in the health care
setting. The proposed paragraph also provides a list of other types of
``language assistance services'' to mirror the definition of the phrase
under the current rule, with the exception of taglines, which the
Department no longer believes constitute the actual provision of a
[[Page 27866]]
service, as opposed to the notification of the availability of
services.
Like the current rule, when interpretation services are required by
the rule, the proposed rule would prohibit an entity from requiring a
LEP individual to bring his or her own interpreter or rely on a minor
child or accompanying adult to facilitate communication, except under
limited exceptions.
Finally, the Department proposes to redesignate Sec. 92.201(f),
which identified specific technical and training requirements for use
of video remote interpreting services for LEP individuals, as Sec.
92.101(b)(3)(iii), and, as so designated, to revise the provision. In
Sec. 92.201(f), the Department extended the application of the
Americans with Disabilities Act regulatory definition of ``video remote
interpreting services'' which requires video that is high quality,
real-time, full-motion large, sharply delineated, and that does not
transmit blurry or grainy images. See 45 CFR 35.160. Although
individuals with hearing impairments rely on accurately seeing sign
language interpreters (and the proposed rule retains these access
standards for persons who are deaf or hard of hearing), foreign
language speakers can, in many circumstances, rely solely on a clear
audio transmission for effective communication. Given that equipment
and training costs for more sophisticated video remote interpreting
technology can be more expensive than audio,\119\ the Department
believes that additional video standards may not justify the costs,
particularly with respect to small providers.\120\
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\119\ See Barb Jacobs, Anne M. Ryan, et al., Medical
Interpreters in Outpatient Practice, 16:1 Annals of Family Medicine
70-76 (Jan. 2018), https://doi.org/10.1370/afm.2154 (stating that
costs can be ``considerable,'' ranging from $1.25 to $3.00 per
minute for audio interpreters, and $1.95 to 3.49 per minute for
video interpreters, sometimes with minimum number of minutes
required per session. Setup costs for video remote interpreting
equipment vary, depending on whether a laptop, desktop, or cameras,
speakers and microphones are used'').
\120\ Christopher M. Burkle, Kathleen A. Anderson, et al.,
Assessment of the efficiency of language interpreter services in a
busy surgical and procedural practice, BMC Health Services Research
17:456 (2017), https://doi.10.1186/s12913-017-2425-7 (``With
increasing numbers of LEP patients over time along with any new
mandates for providing language assistance, the financial
implications for many health care facilities will likely continue to
be a challenge'').
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The Department seeks comment on the extent to which covered
entities rely on video remote interpreting for LEP individuals,
circumstances where a clear video signal (as opposed to audio) would be
necessary for effective communication, the applicable costs of this
service, and whether such standards improve the effectiveness of
communication. Consequently the Department proposes to repeal certain
provisions on video standards for remote language interpretation
services, but retain the audio standards which require clear, audible
transmission of voices, use of quality video connection without lagging
or irregular pauses in transmission, and applicable training of staff
to use the remote interpreting technology.
Finally, paragraph (c), by retaining the provision currently found
at Sec. 42.201(g), would clarify that Section 1557 does not require
patients to accept the language access services offered by a provider.
In its proposed revisions to its meaningful access requirements,
the Department attempts, in accordance with Supreme Court guidance, to
strike an appropriate balance with respect to the Title VI rights of
LEP individuals and the burdens imposed on the regulated community. The
Department believes that its proposal--in what it proposes to retain,
and in what it proposes to revise--strikes the right balance and
provides benefits greater than the burdens imposed. The Department
nevertheless seeks comment on whether it has struck that proper balance
with respect to benefits and burdens.
The Department seeks comment particularly in light of the proposed
retention of some provisions that impose requirements on covered
entities under the Section 1557 Regulation (which govern health
programs or activities) but not on entities who only receive HHS
funding for human services. Specifically, on whether there is or will
continue to be problems, confusion or further complexity in
implementing the regulations arising from differing standards, and if
so, what could or should be done to address such problems/issues,
including the possibility of amending the Department's Title VI
regulation.
The Department retains several key definitions with respect to LEP
services. The proposed rule incorporates, as requirements with respect
to interpreters and translators, the elements of the definitions of
``qualified interpreter'' for an individual with LEP and of ``qualified
translator'' in the text of the rule. See proposed Sec. 92.101(b)(3).
In other cases, some terms are clear enough so as to not require a
definition, such as ``individual with limited English proficiency.'' In
this example, OCR will continue to interpret the phrase as under the
Final Rule to mean ``an individual whose primary language for
communication is not English and who has a limited ability to read,
write, speak, or understand English.'' Similarly, OCR will continue to
interpret the phrase ``qualified bilingual/multilingual staff'' to mean
a member of a covered entity's workforce who is designated by the
covered entity to provide oral language assistance as part of the
individual's current, assigned job responsibilities and who has
demonstrated to the covered entity that he or she: (1) Is proficient in
speaking and understanding at least spoken English and the spoken
language in need of interpretation, including any necessary specialized
vocabulary, terminology and phraseology, and (2) is able to
effectively, accurately, and impartially communicate directly with LEP
individuals in their primary languages.
The Department contemplates also continuing to abide by terms
defined in the definition section of the Title VI regulation where
relevant to LEP issues.
Proposed ``45 CFR 92.102 Effective communication for individuals with
disabilities.''
The Department retains Sec. 92.202 of the current rule, but
proposes to redesignate it as Sec. 92.102. Paragraph (a) requires that
communications with individuals with disabilities must include
provision of appropriate auxiliary aids and services, bars requiring
that individuals with disabilities bring their own interpreters, sets
minimum standards for video remote interpreting and telephone relay
services, exempts covered entities from actions that result in a
fundamental alteration in the nature of a service, program, or activity
or in undue financial and administrative burdens, and requires
appropriate timeliness, respect for privacy concerns, and independence
of the individual with a disability. Paragraph (b) requires recipients
of Federal financial assistance and State Exchanges subject to part 92
to provide appropriate auxiliary aids. These provisions are drawn from
regulations implementing Title II of the Americans with Disabilities
Act, which applies to any public entity,\121\ and which were
promulgated by the Department of Justice. See 28 CFR 35.160 through
35.164.
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\121\ ``Public entity'' includes State or local government; any
department, agency, special purpose district, or other
instrumentality of a State or States or local government. 42 U.S.C.
12311; see also 28 CFR 35.104(3). The proposed rule instead uses
``entity'' with respect to provisions concerning disability rights,
as it does with other provisions concerning who or what is covered
by the proposed rule.
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As stated earlier, although the Department proposes to repeal the
definitions section, it would still apply
[[Page 27867]]
many of the definitions that the Section 1557 Regulation incorporated
from the Americans with Disabilities Act (``ADA'') (42 U.S.C. 12101 et
seq.) or its regulations. The definitions incorporated from the ADA are
the following: disability,\122\ auxiliary aids and services,\123\
qualified interpreter,\124\ video remote interpreting,\125\ information
and communications technology,\126\ technical definitions and standards
under the ADA,\127\ and Uniform Federal Accessibility Standards as
promulgated.\128\ The Department also proposes to retain the Current
Rule's definitions of ``oral transliterators'' \129\ and ``cued
language transliterators.'' \130\
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\122\ 42 U.S.C. 12102 (The term ``disability'' means with
respect to an individual--(A) a physical or mental impairment that
substantially limits one or more major life activities of such
individual; (B) a record of such an impairment; or (C) being
regarded as having such an impairment.'' 42 U.S.C. 12102(1)).
\123\ The list of auxiliary aids and services from 28 CFR 35.104
is incorporated into the proposed rule at Sec. 92.102(b)(1).
\124\ The description of a qualified interpreter from 28 CFR
35.104 informs the description in the proposed rule at Sec.
92.101(b)(3).
\125\ The description of video remote interpreting at 28 CFR
36.303(f) is incorporated by reference in the proposed rule at Sec.
92.102(b)(1)(i).
\126\ 36 CFR part 1194, appendix D, D1194.4.
\127\ Appendix D to 28 CFR part 36 and 28 CFR 35.104.
\128\ 49 FR 31528 (Aug. 7, 1984), https://www.access-board.gov/guidelines-and-standards/buildings-and-sites/about-the-aba-standards/ufas.
\129\ The Section 1557 Rule defined ``oral transliterators'' as
``individuals who represent or spell in the characters of another
alphabet''). 45 CFR 92.4.
\130\ ``Cued language interpreters'' are defined as
``individuals who represent or spell by using a small number of
handshapes''). 45 CFR 92.4.
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The Department seeks comment on whether to propose an exemption
from the auxiliary aids and services requirement for covered entities
with fewer than 15 employees. The Department's current Section 504
regulations permit the exemption, but allow the OCR Director discretion
to impose a requirement on recipients with fewer than 15 employees if
provision of auxiliary aids and services would not significantly impair
the ability of the recipient to provide the benefits or services. See
45 CFR 84.52(d). The OCR Director announced such a requirement in 2000.
See Notice of Exercise of Authority Under 45 CFR 84.52(d)(2) Regarding
Recipients With Fewer Than Fifteen Employees, 65 FR 79368 (Dec. 19,
2000). The Final Rule did not include the exemption because the
Department believed that imposing the requirement on all entities would
promote ``uniformity and consistent administration of law.'' 81 FR
31407.
Proposed ``45 CFR 92.103 Accessibility standards for buildings and
facilities.''
The Department proposes to retain Sec. 92.203 of the current rule,
but to redesignate it as Sec. 92.103. Subsection (a) requires that new
construction or alteration of buildings or facilities subject to
Section 1557 must comply with the 2010 ADA Standards for Accessible
Design by January 18, 2018. However, this paragraph allows departures
from the 2010 ADA standards where other methods are permitted that
provide substantially equivalent or greater access to and usability of
the building. Subsection (b) contains a safe harbor for new
construction or alteration of buildings or facilities subject to
Section 1557, allowing existing facilities which were only required to
be compliant with the UFAS standards, 1991 ADA Standards, or the 2010
ADA Standards as of July 18, 2016, to be deemed compliant, unless there
is new construction or alteration after January 18, 2018. The source of
these provisions, Title III of the Americans with Disabilities Act,
applies to any public or private owner, lessor, or operator of a place
of public accommodation,\131\ any public or private owner, lessor, or
operator of commercial facilities,\132\ or private entities that offer
examinations or courses related to applications, licensing,
certification, or credentialing for secondary or postsecondary
education, professional, or trade purposes.\133\
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\131\ 42 U.S.C. 12812(a). See also 28 CFR 35.102 (DOJ
regulations apply to ``all services, programs, and activities
provided or made available by public entities'').
\132\ 42 U.S.C. 12183.
\133\ 28 CFR 36.102(a)(3).
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The Department seeks comment on the appropriateness of applying the
2010 ADA Standards' definition of ``public building or facility'' to
all entities covered under Section 1557, specifically with respect to
benefits to individuals and disabilities or burdens on private entities
related to multistory building elevator \134\ and TTY \135\
requirements.
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\134\ Exception 1 of section 206.2.3 of the 2010 Standards
exempts multistory buildings besides the professional office of a
health care provider owned by private entities from the requirement
to provide an elevator to facilitate an accessible route throughout
the building. This exemption does not apply to public entities.
\135\ The 2010 ADA Standards also specifies TTY requirements for
public buildings different from private buildings. Compare ADA 2010
Standard 217.4.3.1 (public buildings) with ADA 2010 Standard
217.4.3.2 (private buildings).
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Proposed ``45 CFR 92.104 Accessibility of information and communication
technology for individuals with disabilities.''
The Department retains Sec. 92.204 of the current rule, but
proposes to redesignate it as Sec. 92.104. Paragraph (a) requires
covered entities to ensure that their health programs or activities
provided through information and communication technology are
accessible to individuals with disabilities, except when resulting in
an undue financial or administrative burden or fundamental alteration
in the nature of an entity's health program or activity. Paragraph (b)
requires effective communication over Federally-facilitated Exchange
websites and Department administered health programs or activities it
administers.
The Department proposes to use the term ``information and
communication technology'' as defined in the Architectural and
Transportation Barriers Compliance Board (``U.S. Access Board'')
regulations implementing Section 508 of the Rehabilitation Act (36 CFR
part 1194, appendix A, E103.4). In the Final Rule, HHS stated that it
would use the terminology and its definition from the U.S. Access Board
regulations. 81 FR 31382. At the time of the Final Rule's promulgation,
the Architectural and Transportation Barriers Compliance Board
regulations had been proposed but the rulemaking process had not
concluded. The proposed Section 1557 rule includes the updated citation
and nomenclature change from the now finalized U.S. Access Board
regulation. 82 FR 5790 (Jan. 18, 2017) (Final Rule); 83 FR 2912 (Jan.
22, 2018) (technical edits).
Paragraph (b) states the requirements of Section 504 as applied to
the Department and Department-conducted or administered health programs
or activities. See 29 U.S.C. 794 (Section 504); 45 CFR part 85 (Section
504). However, in addition to Section 504, Section 508 of the
Rehabilitation Act and its implementing regulations also apply to each
Federal department or agency. See 29 U.S.C. 794d; see also 45 CFR part
85 (Section 504), 36 CFR 1194.1 and Apps. A, C, and D.\136\ The
[[Page 27868]]
Department seeks comment as to whether the Department should cross-
reference Section 508 and its applicable implementing regulations in
proposed Sec. 92.104.
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\136\ When conformance to requirements in the Revised 508
Standards would impose an undue burden or would result in a
fundamental alteration in the nature of the ICT, conformance is
required only to the extent that it does not impose an undue burden
or result in a fundamental alteration in the nature of the ICT. The
Section 1557 Regulation does not override the standards under
Section 508 that concurrently apply to the Department and
Department-conducted health programs or activities.
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Proposed ``45 CFR 92.105 Requirement to make reasonable
modifications.''
The Department retains Sec. 92.205 of the current rule, but
proposes to redesignate it as Sec. 92.105. This section requires
covered entities to make reasonable modifications to policies,
practices, or procedures when necessary, to avoid discrimination on the
basis of disability, except if the modification would fundamentally
alter the nature of the health program or activity. This provision is
derived from regulations implementing Title II of the Americans with
Disabilities Act promulgated by the Department of Justice and imposed
on all public entities. See 28 CFR 35.104.
The Department seeks comment whether this provision should be
retained or substituted with language conforming to the Department of
Justice's Section 504 coordinating regulations which state that covered
entities ``shall make reasonable accommodation to the known physical or
mental limitations of an otherwise qualified'' individual with a
disability. See 28 CFR 92.205. The Department also seeks comment
whether to include an exemption for ``undue hardship.'' See 45 CFR
84.12 (HHS Section 504 regulation); 28 CFR 92.205 (DOJ Section 504
coordinating regulation).
Request for Comments on Proposed 45 CFR 92.102 Through 92.105
In retaining the requirements imposed in the Section 1557
Regulation through Section 504 with respect to disability, the
Department seeks to strike an appropriate balance with respect to the
Section 504 rights of individuals with disabilities and the obligations
imposed on the regulated community. With respect to the requirement for
regulated entities to provide assurances, the Department also seeks to
strike an appropriate balance. The Department believes that, in
retaining all of these requirements, it has struck that balance and
provides benefits greater than the burdens it imposes. Even so, the
Department seeks comment on whether it has struck that proper balance
by retaining the provisions, and whether the benefits of these
provisions exceed the burdens imposed by them. The Department also
seeks comment on whether, in light of the proposed retention of such
provisions, the requirements imposed on covered entities under the 1557
regulations differ from those entities who are only subject to the
underlying civil rights laws and regulations (e.g., the Department's
human services grantees), and whether there is or will continue to be
problems, confusion or further complexity in implementing the
regulations arising from any lack of consistency of the requirements
imposed under the regulations and, if so, what could or should be done
to address such problems or issues.
The Department seeks comment on whether revisions should be made to
these provisions and whether they are adequately addressed in the
underlying regulations (or should be) or if additional cross references
should be made.
B. Current Section 1557 Regulation Provisions Proposed for Repeal or
Reconsideration
The proposed rule would repeal certain provisions of the Section
1557 Regulation that conflict with, or unnecessarily duplicate, the
statutory text of Section 1557, Federal case law, the four statutes
incorporated by Section 1557 (Title VI of the Civil Rights Act of 1964,
Title IX of the Education Amendments of 1972, the Age Discrimination
Act of 1975, and Section 504 of the Rehabilitation Act of 1973), or
their implementing regulations. The proposal to repeal such provisions
from the Section 1557 Regulation would leave in place all of the
substantive protections of Title VI of the Civil Rights Act of 1964,
Title IX of the Education Amendments of 1972, the Age Discrimination
Act of 1975, and Section 504 of the Rehabilitation Act of 1973 and the
enforcement mechanisms of those statutes referenced at proposed Sec.
92.2. As discussed above, the Department does not propose to remove
several provisions prohibiting discrimination against individuals with
disabilities: With respect to effective communication, accessibility of
buildings and facilities, accessibility of information and
communication technology, and the requirement to make reasonable
modifications. The Department also does not propose to repeal the
provision on assurances of compliance with Section 1557. A provision on
language access services for LEP individuals is retained (with proposed
revisions), with the exception of the provisions on taglines, notices
of nondiscrimination, the use of language access plans, and video
standards, as described in the following section, as well as many
duplicative provisions.
1. Taglines, Notices, Language Access Plans, and Video Interpretation
Standards
The Department proposes to repeal in toto the Section 1557
provisions on taglines,\137\ the use of language access plans,\138\ and
notices of non-discrimination.\139\ The Department also proposes to
replace the requirements for remote English-language video interpreting
services with comparably effective requirements with respect to audio-
based services.\140\ The current rule's provisions were not justified
by need, were overly burdensome compared to the benefit provided, and
created inconsistent requirements for HHS funded health programs or
activities as compared to HHS funded human services programs or
activities. The Department proposes to return to the language access
standard previously in place under the existing Title VI regulation as
interpreted by the U.S. Supreme Court and HHS and the Department of
Justice in their LEP guidance documents. Other Department regulations
that require the provision of taglines in certain healthcare contexts
\141\ and do not otherwise track,
[[Page 27869]]
reference, or rely on Section 1557 or its regulations would not be
impacted by the proposed repeal of the taglines provisions.\142\
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\137\ See 45 CFR 92.4 (definition of taglines), 92.8(d) (posting
of taglines), 92.8(e) (languages of taglines), 92.8(f) (tagline
notices). 92.8(g) (taglines in significant publications and
communications); Appendix B to 45 CFR part 92 (sample tagline).
\138\ 45 CFR 92.201(b)(2) (requiring the OCR Director to ``take
into account . . . whether a covered entity has developed and
implemented an effective written language access plan, that is
appropriate to its particular circumstances'' in evaluation of
compliance). 45 CFR 92.201(b)(2).
\139\ 45 CFR 92.8; Appendix B to 45 CFR part 92 (sample notice).
\140\ 45 CFR 92.201(f).
\141\ E.g., 42 U.S.C. 300gg-15(b)(2) and 300gg-19(a)(1)(B)
(requiring standards for ensuring that the Summaries of Benefits and
Coverage and certain notices are provided in a culturally and
linguistically appropriate manner); 42 U.S.C. 1396d(p)(5)(A)
(requiring HHS to distribute to States an application form for
Medicare cost-sharing in English and 10 non-English languages); 26
CFR 1.501(r)-4(a)(1), (b)(5)(ii) (requiring a hospital organization
to translate certain documents, among other requirements, to qualify
for a tax-exempt status with respect to a hospital facility); 42 CFR
422.2262(a)(1)-(2) and 422.2264(e) (setting forth Medicare Advantage
marketing requirements, which include requiring Medicare Advantage
organizations to translate marketing materials into non-English
languages spoken by 5% or more of individuals in a plan service
area), 423.2262(a)(1)-(2) and 423.2264(e) (setting forth Medicare
Part D marketing requirements, which include requiring Part D plan
sponsors to translate marketing materials into non-English languages
spoken by 5% or more of individuals in a plan service area); 45 CFR
155.205(c)(2)(iii)(A) (Marketplaces must post taglines on their
websites and include taglines in documents ``critical for obtaining
health insurance coverage or access to health care services through
a QHP''); 45 CFR 147.136(e)(2)(iii) and (e)(3), and 147.200(a)(5)
(requiring taglines in languages in which 10% of individuals with
limited English proficiency (LEP) county-wide are exclusively
literate on internal claims and appeals notices and on an issuer's
Summary of Benefits and Coverage); 42 CFR 435.905(b)(3) (requiring
individuals to be ``informed of the availability of language
services . . . and how to access . . . [them] through providing
taglines in non-English languages indicating the availability of
language services''); 42 CFR 457.340(a) (applying certain Medicaid
requirements, including 435.905(b)(3), which requires individuals to
be ``informed of the availability of language services . . . and how
to access . . . [them] through providing taglines in non-English
languages indicating the availability of language services''); 210
Illinois Cons. Stat. 87/1 (Illinois Language Assistance Act).
\142\ See, e.g., 45 CFR 155.205(c)(2)(iii)(A) (deeming
compliance with the LEP provisions of the Section 1557 regulation to
constitute compliance with CMS's LEP requirements).
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When it promulgated the Section 1557 Regulation, the Department did
not discuss all available Department data on the extent of voluntary
compliance with HHS's LEP 2003 guidance. In 2010, the Department's
Office of the Inspector General (OIG) published two reports,\143\ which
found that the vast majority of Medicare providers and plans in
counties with high proportions of LEP persons surveyed in 2009
conducted the assessment recommended in HHS's guidance.\144\
Additionally, in that 2010 report, 27% of providers cited the cost of
offering language services as an obstacle.\145\ The generally high rate
of voluntary action is one reason that the Department proposes to
repeal some of the Final Rule's LEP mandates and replace them with the
principles and factors of HHS's LEP guidance. The Department requests
comment on these OIG reports, and requests other surveys or reports, if
available, with more current or comprehensive data, to evaluate the
level of voluntary compliance with the best practices identified in the
Department's LEP guidance.
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\143\ HHS OIG, Guidance and Standards on Language Access
Services: Medicare Providers (July 2010) (OIG Providers Report),
https://oig.hhs.gov/oei/reports/oei-05-10-00051.pdf (surveying 140
randomly selected Medicare providers, such as hospitals and nursing
homes, that directly supply health care services to beneficiaries);
HHS OIG, Guidance and Standards on Language Access Services:
Medicare Plans (July 2010) (OIG Plans Report), https://oig.hhs.gov/oei/reports/oei-05-10-00050.pdf (surveying 139 randomly selected
private companies that contract with CMS to provide health insurance
under Medicare Advantage or prescription drug coverage under
Medicare Part D).
\144\ OIG Providers Report at 34; OIG Plans Report at 29.
\145\ OIG Providers Report at 23.
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2. Redundant Provisions Duplicative of Pre-Existing Regulations
The Section 1557 Regulation contains provisions that are
duplicative of, inconsistent with, or may be confusing in relation to
the Department's pre-existing Title VI, Section 504, Title IX, and the
Age Act regulations. In some cases, they may also be duplicative of,
inconsistent with, or confusing in relation to coordinating regulations
published by DOJ for Title VI and Section 504, applicable to recipients
of Federal financial assistance. See 28 CFR parts 41 (Section 504) and
42 (Title VI).
These Section 1557 provisions relate to definitions; \146\ health
insurance coverage; \147\ certain employee health benefits programs;
\148\ notification of rights of beneficiaries under civil rights laws;
\149\ designation of responsible employees and adoption of grievance
procedures; \150\ access granted to OCR for review of covered entities'
records of compliance; \151\ prohibitions on intimidation and
retaliation; \152\ and remedial action and voluntary action.\153\
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\146\ Compare 45 CFR 92.4 (Section 1557) with 45 CFR 80.13
(Title VI), 85.3 (Section 504), 86.2 (Title IX) and 91.12 (Age Act).
\147\ Compare 45 CFR 92.207 (non-discrimination in health-
related insurance and other health-related coverage under Section
1557) with 45 CFR 80.5 (health benefits under Title VI), 84.43
(health insurance under Section 504), 84.52 (health benefits under
Section 504), 84.33 (rule of construction of Section 504 vis-
[agrave]-vis validly obligated payments from health insurer); 86.39
(health insurance benefits and services under Title IX).
\148\ Compare 45 CFR 92.208 (employer liability for
discrimination in employee health benefit programs in Section 1557)
with 45 CFR 86.56 (discrimination on the basis of sex in fringe
benefits under Title IX). In view of the current 1557 rulemaking,
the enforcement Memorandum of Understanding (MOU) between OPM and
the Department, available at https://www.hhs.gov/sites/default/files/opm.pdf, would be moot if this proposed rule were to become
final. Moreover, because the MOU is akin to subregulatory guidance,
it is suspended during this rulemaking, consistent with Section V
below.
\149\ Compare 45 CFR 92.8 and Appendix A to 45 CFR part 92
(Section 1557) with 45 CFR 80.6 and Appendix to Part 80 (Title VI),
84.8 (Section 504), 86.9 (Title IX) and 91.32 (Age Act).
\150\ Compare 45 CFR 92.7 and Appendix C to 45 CFR part 92
(Section 1557) with 45 CFR 84.7 (Section 504), and 86.8 (Title IX).
\151\ Compare 45 CFR 92.303(c) (Section 1557) with 45 CFR 91.31
(Age Act) and 80.6(c) (Title VI).
\152\ Compare 45 CFR 92.303(d) (Section 1557) with 45 CFR
80.7(e) (Title VI) and 91.45 (Age Act).
\153\ Compare 45 CFR 92.6 (Section 1557) with 45 CFR 84.6
(Section 504), 86.3 (Title IX), and 91.48 (Age Act).
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The Department seeks comment on the provisions proposed for repeal,
and which of these, if any, should be preserved, in whole or part, in
the rule, whether they are already addressed in the underlying
regulations (or should be), and with particular comments requested
about the following subjects:
Coverage of certain employee health benefit programs.
Designation of responsible employees and adoption of
grievance procedures.
Notification of beneficiaries, enrollees, applicants,
patients, and/or members of the public of rights and responsibilities
under civil rights laws.
IV. Need for Conforming Amendments
In conjunction with the proposed new provisions for the Section
1557 regulation, the Department proposes to add provisions containing
Title IX's exemptions to its Title IX Regulation in order to conform it
to the statute, be consistent with the Section 1557 regulation, and
reflect current law. This proposed rule would also amend regulations
governing certain HHS-funded or HHS-administered health programs
covered by Section 1557 or Title IX in order to conform them to the
scope of the changes defined by this proposed rule.
A. Nondiscrimination in Education Programs or Activities
In conjunction with the proposed Section 1557 Regulation, the
Department proposes to conform the Title IX regulation to statutory
exemptions consistent with the Section 1557 regulation and current law.
Although the Section 1557 Regulation incorporated exemptions of Title
VI, Section 504, and the Age Act,\154\ it did not incorporate the
abortion and religious exemptions contained in Title IX. The Franciscan
Alliance court stated that the Department's failure to incorporate
statutory exemptions ``nullifies Congress's specific direction to
prohibit only the ground proscribed by Title IX.'' Franciscan Alliance,
227 F. Supp. 3d at 690-691 (citations omitted).
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\154\ See 45 CFR 92.101(a)(6) (The exceptions applicable to
Title VI apply to discrimination on the basis of race, color, or
national origin under this part. The exceptions applicable to
Section 504 apply to discrimination on the basis of disability under
this part. The exceptions applicable to the Age Act apply to
discrimination on the basis of age under this part. These provisions
are found at Sec. Sec. 80.3(d), 84.4(c), 85.21(c), 91.12, 91.15,
and 91.17-.18 of this Subchapter.'')
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In its April 5, 2019 brief in Franciscan Alliance, DOJ, on behalf
of HHS, stated that the prohibition on sex discrimination under Section
1557 ``unambiguously includes Title IX's exemptions, including those
addressing religion and abortion.'' \155\ To address the Franciscan
Alliance court's holding and ensure a consistent and equitable
enforcement approach, HHS proposes to amend its Title IX regulation to
include
[[Page 27870]]
the statutory abortion \156\ and religious \157\ exemptions.
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\155\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O, p. 11 (N.D. Tex, filed April 5, 2019).
\156\ ``Nothing in this title shall be construed to require or
prohibit any person, or public or private entity, to provide or pay
for any benefit or service, including the use of facilities related
to an abortion . . . .'' Public Law 100-259, 102 Stat. 28 (Mar. 22,
1988) (codified at 20 U.S.C. 1688).
\157\ 20 U.S.C. 1681(a)(3) (providing that the prohibition of
discrimination on the basis of sex ``shall not apply to an
educational institution which is controlled by a religious
organization if the application of this subsection would not be
consistent with the religious tenets of such organization''); 81 FR
31435 (HHS declines to include a religious exemption in Section
1557).
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The Final Rule did not include an affirmative religious exemption
in the Section 1557 Regulation, but stated that ``Insofar as the
application of any requirement under this part would violate applicable
Federal statutory protections for religious freedom and conscience,
such application shall not be required.'' The Franciscan Alliance court
held that there was a likelihood that plaintiffs would prevail on the
claim that ``[t]he Rule's failure to include Title IX's religious
exemptions renders the Rule contrary to law.'' \158\ After further
consideration of this issue, the Department concludes that any
enforcement of Title IX by the Department, and, therefore, any
enforcement of Section 1557 to the extent it incorporates Title IX,
must be constrained by the statutory contours of Title IX, which
include its abortion and religious exemptions, and must be set forth
more clearly than occurred in the Final Rule. Therefore, to comply with
the Franciscan Alliance court's decision and Congress's directives in
Title IX and Section 1557, and to properly give effect to religious
liberty and conscience protections related to the provision of abortion
services provided explicitly under Title IX, the Department proposes to
amend its Title IX regulation to conform to the statute.
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\158\ 227 F. Supp. 3d at 690-671.
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In the Final Rule, the Department stated that termination of
pregnancy \159\ was included as a prohibited basis of discrimination on
the basis of sex under the Section 1557 Regulation in order to
``mirror'' the text of the Department's Title IX regulation. 81 FR at
31387 (May 19, 2016) (Section 1557 Final Rule); see also 80 FR at 54176
(Sept. 8, 2015) (Section 1557 Proposed Rule). However, the Department
did not incorporate relevant abortion exemption language from the text
of Title IX itself. 20 U.S.C. 1688.\160\ As the Franciscan Alliance
court noted:
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\159\ Although this proposed rule does not adopt a position on
whether discrimination on the basis of termination of pregnancy can
constitute discrimination on the basis of sex, it does not mean that
OCR could not consider such claims of discrimination, such as
discrimination on the basis of miscarriage or discrimination on the
basis of medical complications resulting from a termination of
pregnancy.
\160\ The Civil Rights Restoration Act (CRRA) added the
following language to Title IX, ``Nothing in this chapter shall be
construed to require or prohibit any person, or public or private
entity, to provide or pay for any benefit or service, including the
use of facilities, related to an abortion. Nothing in this section
shall be construed to permit a penalty to be imposed on any person
or individual because such person or individual is seeking or has
received any benefit or service related to a legal abortion.''
Public Law 100-259, 102 Stat. 28 (Mar. 22, 1988) (codified at 20
U.S.C. 1688). The CRRA also included a rule of construction stating
that ``No provision of this Act or any amendment made by this Act
shall be construed to force or require any individual or hospital or
any other institution, program, or activity receiving Federal funds
to perform or pay for an abortion.'' Id. at Sec. 8.
Title IX prohibits discrimination on the basis of sex, but . . .
. categorically exempts any application that would require a covered
entity to provide abortion or abortion-related services. 20 U.S.C.
1688. . . . Failure to incorporate Title IX's religious and abortion
exemptions nullifies Congress's specific direction to prohibit only
---------------------------------------------------------------------------
the ground proscribed by Title IX. That is not permitted.
Franciscan Alliance, 227 F. Supp. 3d at 690-91.
Proposed ``45 CFR 86.18 Amendments to conform to statutory
exemptions.''
To resolve the current litigation, avoid future litigation over the
Department's Title IX and Section 1557 regulations, and give effect to
the statutory abortion exemption provisions adopted by Congress and
relevant rules of construction adopted by Congress, the Department
proposes to amend its Title IX regulations at 45 CFR part 86 to add a
new Section 86.18.
In proposed Sec. 86.18(a), the Department seeks to codify the
abortion exemption to Title IX. The Department proposes to use the text
Congress added to Title IX by means of the CRRA--which states that
``Nothing in this chapter shall be construed to require or prohibit any
person, or public or private entity, to provide or pay for any benefit
or service, including the use of facilities, related to an abortion,''
Public Law 100-259, 102 Stat. 28 (Mar. 22, 1988) (codified at 20 U.S.C.
1688)--as the basis of the regulatory text, making the appropriate
changes to reflect the difference between the statute and the
implementing regulations.
Proposed Sec. 86.18(b) would set forth the rule of construction in
Title IX, as added by the CRRA. The Department again proposes to base
the regulatory text on the language of the rule of construction adopted
by Congress: ``No provision of this Act or any amendment made by this
Act shall be construed to force or require any individual or hospital
or any other institution, program, or activity receiving Federal funds
to perform or pay for an abortion.'' Id. at Sec. 8.
In proposed Sec. 86.18(c), the Department proposes to incorporate
other relevant laws that may impact the application of the Title IX
abortion exemption. This paragraph would incorporate the laws cited by
the Franciscan Alliance court: the Religious Freedom Restoration
Act,\161\ the Weldon Amendment,\162\ the Coats-Snowe Amendment,\163\
and the Church Amendments.\164\ See 227 F. Supp. 3d at 690-91. The
Department also proposes to reference the First Amendment to the U.S.
Constitution, the Hyde Amendment,\165\ the Helms Amendment,\166\ and
Section 1303 of the Patient Protection and Affordable Care Act.\167\
The Department concludes that all of these statutes establish
Congressionally required parameters that may apply to the Department's
interpretation, implementation, and enforcement of Title IX.\168\
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\161\ 42 U.S.C. 2000bb-1.
\162\ E.g., Public Law 114-113, Div. H, sec. 507(d), 129 Stat.
2242, 2649 (2015).
\163\ 42 U.S.C. 238n.
\164\ 42 U.S.C. 300a-7.
\165\ E.g., Consolidated Appropriations Act, 2019, Public Law
115-245, Div. B, sec. 506(a).
\166\ E.g., Continuing Appropriations Act, 2019, Public Law 115-
245, Div. C, sec. 7018.
\167\ 42 U.S.C. 18023.
\168\ To the extent the law is found in an appropriations rider,
it applies to the Department's interpretation, implementation, and
enforcement of Title IX every year that it is enacted.
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The Department requests comment on proposed Sec. 86.18.
B. Proposed Conforming Amendments
The Department proposes to amend certain regulations that identify
``sexual orientation'' or ``gender identity'' as prohibited bases of
discrimination for certain Department health programs or activities, to
the extent that the regulations are not based on independent statutory
authority which expressly provides such prohibition. As stated above,
Congress through Section 1557 adopted certain nondiscrimination
requirements for health programs or activities, any part of which
receive Federal financial assistance or programs or activities
administered by an Executive agency under Title I of the PPACA or by an
entity established under such Title by cross-referencing the grounds
for discrimination prohibited by longstanding civil rights laws--
namely, race, color, national origin, sex, age, or disability. Neither
Section 1557 nor any of those longstanding civil rights laws reference
sexual orientation or gender identity.
[[Page 27871]]
Moreover, as noted in the preamble to the Final Rule, the current
regulation does not treat ``an individual's sexual orientation status
alone [a]s a form of sex discrimination under Section 1557,'' 81 FR
31390. It is the position of the United States government that Title
VII, which is read consistent with or carries over to Title IX when
determining the scope of discrimination on the basis of ``sex,'' ``does
not reach discrimination based on sexual orientation.'' DOJ Brief for
the United States as Amicus Curiae, Zarda v. Altitude Express, Inc.,
No. 15-3775 (2d Cir. July 26, 2017). It is also the position of the
United States government that ``Title VII's prohibition on sex
discrimination . . . does not encompass discrimination based on gender
identity per se, including transgender status.'' Memorandum of the
Attorney General (Oct. 4, 2017).\169\ As discussed above, on April 5,
2019, DOJ filed a brief in Franciscan Alliance v. Azar on behalf of
HHS, reiterating the U.S. Government's position about Title VII, and
stating that ``the [Section 1557] Rule's prohibitions of discrimination
on the basis of gender identity and, without the accompanying statutory
protections, termination of pregnancy are substantively unlawful under
the APA.'' \170\
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\169\ Memorandum of the Attorney General, (Oct. 4, 2017),
https://www.justice.gov/ag/page/file/1006981/download.
\170\ See Defendant's Memorandum in Response to Plaintiffs'
Motions for Summary Judgment, Franciscan Alliance, No. 7:16-cv-
00108-O, at 5 (filed April 5, 2019).
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This proposed rule, thus, seeks to amend regulations that identify
sexual orientation or gender identity as prohibited bases for
discrimination for certain Department funded or administered programs
covered by Section 1557 in order to conform them more closely to the
prohibited bases for discrimination authorized by Section 1557, and
encompassed in the proposed Sec. 92.2, and to conform them with
government policy. The provisions proposed to be conformed are:
45 CFR 155.120(c)(1)(ii) and 155.220(j)(2),
nondiscrimination provisions concerning how States and Exchanges carry
out PPACA requirements and how agents or brokers market to individuals
they assist with Exchange enrollment or related applications.
45 CFR 147.104(e), nondiscrimination provision concerning
marketing or benefit design practices of health insurance issuers under
the PPACA.
45 CFR 156.200(e) and 156.1230(b)(3), nondiscrimination
provision concerning the administration of qualified health plans (QHP)
by issuers and concerning marketing and other conduct by QHP issuers
engaged in direct enrollment of applicants under the PPACA.
42 CFR 460.98(b)(3) and 460.112(a), nondiscrimination
provisions concerning organizations operating Programs for All-
inclusive Care of the Elderly (PACE) programs and participants
receiving PACE services under Medicare.
42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262,
nondiscrimination provisions concerning Medicaid beneficiary
enrollment, and promotion and delivery of access and services.
Additionally, the Department proposes to amend its Title IX
regulation at 45 CFR 86.31 to remove any potential ambiguity or
conflict concerning the current regulation's prohibition of
discrimination ``in the application of any rules of appearance.''
Currently, the Department is the only Federal agency with Title IX
regulatory language prohibiting discrimination ``against any person in
the application of any rules of appearance.'' \171\ 45 CFR 86.31(b)(5)
(retained from the predecessor 1975 HEW regulation). While ``rules of
appearance'' does not appear in Title IX and was never defined in any
agency's Title IX regulations, the phrase may cause confusion in the
public about Title IX's coverage and compliance responsibilities and
has already led to at least one lawsuit.\172\ Because this language is
not in current regulations of any other agencies, the proposed edit
would eliminate the potential for conflicting and inequitable Federal
agency enforcement of Title IX. See Jespersen v. Harrah's Operating
Co., No. 03-15045 (9th Cir. Apr. 14, 2006) (en banc) (finding sex-
specific uniform, appearance and grooming standards did not violate
Title VII's prohibition on sex discrimination).
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\171\ See, e.g., 47 FR 32527 (July 28, 1982) (Department of
Education Title IX regulation); 65 FR 52858 (Aug. 30, 2000) (common
rule adopted by twenty agencies), 66 FR 4627 (Feb. 20, 2001) (common
rule adopted by Department of Energy); 82 FR 46656 (Oct. 6, 2017)
(U.S. Department of Agriculture adopting common rule). None of these
agency Title IX rules contain any language concerning ``rules of
appearance.''
\172\ See Complaint, Peltier et al. v. Charter Day School, No.
7:16-CV-30-H, No. 160 (E.D.N.C. Mar. 30, 2017) (citing ``rules of
appearance'' in Department of Agriculture's Title IX regulation to
challenge a school's girls' dress code for ``subject[ing] them to
archaic sex stereotypes about what constitutes appropriate behavior
and conduct''); but see 82 FR 46655 (Oct. 6, 2017) (by adopting the
Title IX common rule, the Department of Agriculture no longer
contains language about ``rules of appearance'').
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C. Technical Amendments
Several technical amendments are proposed to the Department's
Section 1557 and Title IX regulations. The Department makes a
nomenclature change to replace ``State-based Marketplace \SM\'' with
``State Exchange'' to conform the proposed rule to CMS regulations. See
45 CFR 155.20. The Department also makes a nomenclature change from
``electronic and information technology'' to ``information and
communication technology'' \173\ and updates the regulatory cross-
reference in this definition from the Access Board's former 508
Standards (36 CFR 1194.4) to its revised 508 Standards (36 CFR part
1194, appendix A, E103.4). The Department also inserts cross-references
to ADA 2010 Standards, 1991 Standards, and UFAS in the regulatory text
concerning accessibility for individuals with disabilities.
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\173\ Although the Section 1557 Regulation uses the term
``electronic and information technology'' (EIT) in Sec. 92.204, the
Department stated that it would update its nomenclature to the U.S.
Access Board's then-proposed new term ``information and
communication technology'' (ICT) upon finalization of the U.S.
Access Board regulation. 81 FR 31382 (Section 1557 Final Rule). See
also 82 FR 5790 (Jan. 18, 2017) (Access Board ICT Final Rule).
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The Department proposes to make a conforming amendment to Sec.
86.2, which defines Title IX for purposes of the regulation as certain
enumerated provisions in the U.S. Code. When the Department updated its
Title IX regulation in 2005 in order to conform to the 1987 CRRA, the
Department failed to add all relevant statutory citations, including 20
U.S.C. 1688, which requires neutrality with respect to abortion.
Compare 70 FR 24314 (May 9, 2005) with Public Law 100-259, 102 Stat. 28
(Mar. 22, 1988) (CRRA). The Department's Title IX regulation should
encompass all relevant provisions of the statute it is regulating and,
accordingly, the Department proposes to edit Sec. 86.2 include
references to 20 U.S.C. 1687 and 1688 to correct the omission.
The enforcement section in the Department's Title IX regulation
currently only addresses applicable procedures for the interim period
between Title IX's ``effective date and the final issuance of a
consolidated procedural regulation applicable to Title IX and other
civil rights authorities.'' 45 CFR 86.71. The proposed rule would
address current enforcement procedures by adopting the same language
from the Title IX common rule, which incorporates Title VI procedures.
The proposed rule would also make nomenclature change to the Title
IX regulation by replacing ``United States
[[Page 27872]]
Commissioner of Education'' with the official's current title,
``Secretary of Education.'' See 45 CFR 86.2(n).
V. Interim Treatment of Subregulatory Guidance
Because the enforcement mechanisms of the underlying four civil
rights statutes in Section 1557 are already enshrined in the
Department's free standing regulations, and implemented and enforced by
the Department's Office for Civil Rights, existing sub-regulatory
guidance not inconsistent with this rulemaking would not be impacted by
this rulemaking. Other subregulatory guidance may, however, be
inconsistent with the Department's interpretation of Section 1557 and
Title IX, and its requirement to comply with court orders.
Upon publication of this notice of proposed rulemaking, the
Department will, as a matter of enforcement discretion, suspend all
subregulatory guidance issued before this proposed rule that interprets
or implements Section 1557 (including FAQs,\174\ letters,\175\ and the
preamble to the current Section 1557 Regulation) that is inconsistent
with any provision in this proposed rule (including the preamble) or
with the requirements of the underlying civil rights statutes cross-
referenced by Section 1557 or their implementing regulations. This
suspension may be revoked wholly or partially at any time before
finalization of this proposed rule and will be lifted automatically if
this proposed rule is withdrawn. This suspension is consistent with the
Attorney General's memorandum of November 16, 2017, stating that, for
the Department of Justice, ``guidance may not be used as a substitute
for rulemaking and may not be used to impose new requirements on
entities outside the Executive Branch. Nor should guidance create
binding standards by which the Department will determine compliance
with existing regulatory or statutory requirements.'' \176\ It is also
consistent with the Associate Attorney General's memorandum of Jan. 25,
2018, indicating that Department of Justice litigators cannot use
noncompliance with guidance documents as the basis for proving
violations of law in affirmative civil enforcement cases and may not
use its enforcement authority to convert agency guidance documents into
binding rules.\177\
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\174\ After publishing the Final Rule, OCR issued guidance
explaining that anything printed on an 8.5'' x 11'' sheet of paper
is considered ``significant,'' and, thus, must include the tagline
notice. See OCR, Question 23, General Questions about Section 1557
(May 18, 2017), https://www.hhs.gov/civil-rights/for-individuals/section-1557/1557faqs/index.html; see also OCR, Sample Covered
Entity Tagline Informing Individual with Limited English Proficiency
of Language Assistance, https://cms-drupal-hhs-prod.cloud.hhs.gov/sites/default/files/sample-ce-tagline-english.pdf. This documents
are examples of sub-regulatory guidance that must be suspended under
this proposed rule. See also OCR, Sample Notice Informing
Individuals About Nondiscrimination and Accessibility Requirements
and Sample Nondiscrimination Statement, https://cms-drupal-hhs-prod.cloud.hhs.gov/sites/default/files/sample-ce-notice-english.pdf;
OCR, Frequently Asked Questions to Accompany the Estimates of at
Least the Top 15 Languages Spoken by Individuals with Limited
English Proficiency under Section 1557 of the Affordable Care Act,
(Sept. 1, 2016), https://www.hhs.gov/civil-rights/for-individuals/section-1557/1557faqs/top15-languages/index.html.
\175\ On July 12, 2012, the OCR Director first announced in a
correspondence addressed to a single member of the public that OCR
was accepting and investigating complaints of discrimination on the
basis of ``actual or perceived sexual orientation or gender
identity'' under Section 1557 of the PPACA. OCR Transaction Number
12-00800 (July 12, 2012).
\176\ Memorandum of the Attorney General, ``Prohibition on
Improper Guidance Documents.'' https://www.justice.gov/opa/press-release/file/1012271/download.
\177\ Memorandum of the Associate Attorney General, ``Limiting
Use of Agency Guidance Documents In Affirmative Civil Enforcement
Cases.'' https://www.justice.gov/file/1028756/download.
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VI. Regulatory Impact Analysis
The Department has examined the impacts of the proposed rule as
required by Executive Order 12866 on Regulatory Planning and Review, 58
FR 51735 (Oct. 4, 1993); Executive Order 13563 on Improving Regulation
and Regulatory Review, 76 FR 3821 (Jan. 21, 2011); Executive Order
13132 on Federalism, 64 FR 43255 (Aug. 4, 1999); Executive Order 13175
on Tribal Consultation, 65 FR 67249 (Nov. 6, 2000); Executive Order
13771 on Reducing Regulation and Controlling Costs, 82 FR 9339 (Jan.
30, 2017); the Congressional Review Act (Pub. L. 104-121, sec. 251, 110
Stat. 847 (Mar. 29, 1996)); the Unfunded Mandates Reform Act of 1995,
Public Law 104-4, 109 Stat. 48 (Mar. 22, 1995); the Regulatory
Flexibility Act (Pub. L. 96-354, 94 Stat. 1164 (Sept. 19, 1980);
Executive Order 13272 on Proper Consideration of Small Entities in
Agency Rulemaking, 67 FR 53461 (Aug. 16, 2002); Executive Order 12250,
Leadership and Coordination of Nondiscrimination Laws, 45 FR 72995
(Nov. 2, 1980), and the Paperwork Reduction Act of 1995, 44 U.S.C.
3501, et seq.
A. Executive Orders 12866 and Related Executive Orders on Regulatory
Review
Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects; distributive impacts; and equity). Executive Order 13563 is
supplemental to, and reaffirms the principles, structures, and
definitions governing regulatory review as established in, Executive
Order 12866.
As discussed below, the Department has estimated that the proposed
rule will have an effect on the economy greater than $100 million in at
least one year in fact it will result in greater than $100 million in
savings. Thus, it has been concluded that this proposed rule is
economically significant. It has therefore been determined that this
proposed rule is a ``significant regulatory action'' (albeit of a
deregulatory nature) under Executive Order 12866. Accordingly, the
Office of Management and Budget (OMB) has reviewed this proposed rule.
1. Summary of the Proposed Rule
Through Section 1557 of the PPACA, Congress applied certain long-
standing civil rights nondiscrimination requirements to any health
programs or activities that receive Federal financial assistance, and
any programs or activities administered by an Executive agency under
Title I of the PPACA or by an entity established under such Title. It
did so by cross-referencing the discriminatory grounds prohibited by
those longstanding civil rights laws, namely, discrimination on the
basis of race, color, national origin, sex, age, or disability, in an
array of Federally funded and administered programs or activities. To
ensure compliance, Congress dictated that ``[t]he enforcement
mechanisms provided for and available under'' such laws ``shall apply
for purposes of violations of'' Section 1557. The proposed rule would,
thus, eliminate most of the provisions in the current Section 1557
Regulation and return to the enforcement mechanisms provided for, and
available under, those existing statutes and the Department's
implementing regulations. Specifically, the Department proposes to
repeal the provisions which interpret Federal law inconsistently with
Federal court opinions or impose burdens that unjustifiably exceed
anticipated benefits. These include: The Section 1557 Regulation's
inclusion of novel definitions; language access plan provisions;
provisions that set forth new requirements for tagline notices, notices
of nondiscrimination, and grievance procedures; application of theories
and remedies available under a subset of civil rights laws to all of
them, without
[[Page 27873]]
analysis of whether such theories and remedies were available under all
such civil rights laws; and, provisions based on legal theories that
were inconsistent with (or, at a minimum, unnecessarily duplicated)
provisions of long-standing regulations of the underlying civil rights
laws cited in Section 1557. Consistent with this approach to the
Section 1557 Regulation, the Department proposes to retain certain
language and disability access provisions, as well as the assurance of
compliance requirements. The proposed rule empowers the Department to
continue its robust enforcement of civil rights laws by additionally
making it clear that the substantive protections of Title VI of the
Civil Rights Act of 1964, Title IX of the Education Amendments of 1972,
the Age Discrimination Act of 1975, and Section 504 of the
Rehabilitation Act of 1973, remain in full force and effect.\178\ The
Department also proposes to make certain conforming changes to
regulations across the Department, and to update its underlying Title
IX regulation to adopt statutory amendments, in light of the failures
noted by the district court in Franciscan Alliance.
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\178\ While Section 1557 does not incorporate nondiscrimination
provisions by reference to Title VII, it provides that nothing in
Title I of the PPACA is to be construed as invalidating or limiting
the rights, remedies, procedures, or legal standards available under
certain civil rights laws, including Title VII. 42 U.S.C. 18116(b).
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2. Need for the Proposed Rule
The Department proposes to substantially replace the Section 1557
Regulation, while retaining certain LEP, disability, and assurances of
compliance provisions, in order to better comply with the mandates of
Congress, relieve approximately $3.6 billion in undue regulatory
burdens, further substantive compliance, reduce confusion, and clarify
the scope of Section 1557.
As stated above, the proposed rule is needed in part because two
Federal district courts have determined that the Department exceeded
its authority in promulgating parts of the regulation and have enjoined
or stayed it from applying those parts. By substantially repealing most
of the Section 1557 Regulation, the Department would revert to
statutory interpretations more consistent with the law and with the
United States Government's official position on certain of the
underlying civil rights statutes, and ultimately allow the Federal
courts, in particular, the U.S. Supreme Court, to resolve any dispute
about the proper legal interpretation of such statute and, thus, on
Section 1557 of the Affordable Care Act.
Additionally, the Department has determined that the Final Rule is
duplicative and confusing, has imposed substantial unanticipated
burdens, and that its anticipated and unanticipated burdens are not
justified.
The Department initially estimated the costs from the Section 1557
Regulation at over $942 million across the first five years. 81 FR
31458-31459. This figure, however, underestimated actual five year
costs by at least $2.6 billion, according to the Department's current
estimates. Most of this expense is derived from the taglines
requirement, which amounts to an annual burden of approximately $147
million (low-end) to $1.34 billion dollars (high-end), before
accounting for electronic delivery, for an average annual burden of
$0.632 billion per year, and an average five year burden of $3.16
billion after accounting for electronic delivery, as further described
in this Regulatory Impact Analysis. Based on the Department's re-
examination of the burden on regulated entities, the Department has
preliminarily determined that the potential public benefits of imposing
such requirements are outweighed by the large costs those requirements
impose on regulated entities and other parties.
3. Consideration of Regulatory Alternatives
The Department carefully considered several alternatives, including
the option of not pursuing any regulatory changes, but rejected that
approach for several reasons.
First, not pursuing any regulatory changes would be inconsistent
with the Administration's policies to appropriately reduce regulatory
burden, in general, with respect to individuals, businesses and others,
and resulting from PPACA specifically. Not pursuing any regulatory
change would also be inconsistent with a nationwide preliminary
injunction in place against the Department with respect to the
inclusion, in the Section 1557 Regulation, of gender identity and
termination of pregnancy in the definition of discrimination on the
basis of sex.
Second, Federal courts have reached varying conclusions concerning
a number of legal positions taken by the Department in the Section 1557
Regulation. The Northern District of Illinois dismissed a plaintiff's
claim that the Department created a new enforcement legal standard,
because the ``plain and unambiguous'' statutory text of Section 1557
expressly incorporated four distinct enforcement mechanisms. Briscoe v.
Health Care Serv. Corp., 281 F. Supp. 3d 725, 738 (N.D. Ill. 2017)
(dismissing a Section 1557 claim for sex discrimination using a
disparate impact standard); but see Rumble v. Fairview Health Servs.,
No. 14-cv-2037 (SRN/FLN) (D.Minn. Mar. 16, 2017) (declining to
determine the specific standard on motion to dismiss, rejecting
implication Congress meant to create a ``new anti-discrimination
framework completely `unbound by the jurisdiction of the four
referenced statutes,' '' but concluding Congress ``likely'' intended a
single standard to avoid ``patently absurd consequences''). In
addition, Federal courts in California, New York, and Iowa did not
recognize disparate impact claims for sex discrimination under Section
1557, because such claims are not cognizable under Title IX. See Condry
v. UnitedHealth Group, No. 3:17-cf-00183-VC (N.D. Calif. June 27, 2018)
(Slip. Op. at 7); Weinreb v. Xerox Business Services, 323 F. Supp. 3d
501, 521 (S.D.N.Y. 2018); York v. Wellmark, Inc., No. 4:16-cv-00627-
RGE-CFB, Slip. Op. at *30 (S.D. Iowa Sep. 6, 2017). Another court in
Pennsylvania indicated that there is no disparate impact claim for
discrimination on the basis of race under Section 1557 because such
claims are unavailable under Title VI. See Southeastern Pennsylvania v.
Gilead, 102 F. Supp. 3d 688 (E.D. Pa. 2015); but see Callum v. CVS
Corp., 137 F. Supp. 3d 817 (D.S.C. 2015).
Third, the Department believes that the status quo would not
address, much less remedy, public confusion regarding complainants'
rights, and covered entities' legal obligations. The Department
believes that revisiting the rule will address inconsistences between
the Department's underlying regulations and with the regulations and
actions taken by other components of the Department. As applied to sex
discrimination claims, the Department currently employs a definition of
discrimination on the basis of sex under Section 1557 and, thus, under
Title IX that varies from the practice of other Departments. Moreover,
revising the Section 1557 Regulation will allow the Department to
resolve current and future complaints of sexual orientation and gender
identity discrimination in a manner consistent with other agencies'
enforcement efforts under Title IX. If the Department uses
interpretations of Title IX that differ from other Departments, and
that diverges from the legal interpretation of the U.S. Government, as
set forth by DOJ, it would lead to inconsistent outcomes across
complainants and covered entities, with
[[Page 27874]]
the problem being especially acute in cases involving a single covered
entity being investigated with respect to the same allegations by
multiple Departments that come to different conclusions on effectively
the same question.
The Department also considered adding ``gender identity'' and
``sexual orientation'' to a definition of ``sex'' or ``on the basis of
sex'' under Title IX. The Department concluded it is inappropriate to
do so at this time, in light of the government position on the meaning
of discrimination on the basis of sex under Title VII and cases on
which the U.S. Supreme Court has granted petitions for writs of
certiorari to resolve similar questions in the context of Title VII. As
a policy matter, the Department believes State and local entities are
better equipped to address issues of gender dysphoria or sexual
orientation and the sometimes competing privacy interests with
sensitivity, especially when young children or intimate settings are
involved. The Department's position will not bar covered entities from
choosing to grant protections for sexual orientation and gender
identity that are not required by, but do not conflict with, any other
Federal law.\179\ The Department has also determined that more complex
forms of regulation, such as economic incentives or performance
objectives, are neither appropriate nor feasible solutions to the
problem to be solved.
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\179\ Policies of covered entities that result in unwelcome
exposure to, or by, persons of the opposite biological sex where
either party may be in a state of undress--such as in changing
rooms, shared living quarters, showers, or other shared intimate
facilities--may trigger hostile environment concerns under Title IX.
United States v. Virginia, 518 U.S. 515, 550 n.19 (1996)
(``Admitting women to [an all-male school] would undoubtedly require
alterations necessary to afford members of each sex privacy from the
other sex in living arrangements''); Fortner v. Thomas, 983 F.22d
1024, 1030 (11th Cir. 1993) (``[M]ost people have a special sense of
privacy in their genitals, and involuntary exposure of them in the
presence of people of the other sex may be especially demeaning or
humiliating.'').
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The Department also considered simply repealing the Section 1557
Regulation in toto and not issuing a replacement regulation. Such an
approach would be consistent with the Administration's goals of
reducing the regulatory burden on covered entities and is allowed under
Section 1557, since that provision does not require the Department to
issue implementing regulations. However, the Department is committed to
vigorous enforcement of civil rights and nondiscrimination laws as
directed by Congress. Additionally, it believes that certain
provisions--such as those addressing the assurance of compliance with
Section 1557, effective communication and accessibility for individuals
with disabilities, and certain language access services--address
applications of civil rights laws without the statutory or legal
conflicts or excessive regulatory burdens entailed by other provisions
of the current Rule.
The Department considered retaining the provision on visual
standards for video remote interpreting services for LEP individuals.
However, the burden of requiring covered entities to provide video
technology training and utilize expensive software does not appear to
be justified based on minimal benefit to language speakers who can
effectively communicate when there is clear audio transmission through
the remote interpreting service.
Accordingly, the Department believes it is appropriate to clarify
how the Office for Civil Rights would enforce the PPACA's
nondiscrimination protections by replacing the Section 1557 Regulation
with regulatory provisions (1) explicitly applying the enforcement
mechanisms provided under the civil rights statutes and related
implementing regulations cited by Section 1557 to the health contexts
identified in Section 1557, (2) vesting enforcement authority under
Section 1557 with the Director of the Office for Civil Rights, and (3)
specifying how Section 1557 enforcement shall interact with existing
laws--while retaining certain language and disability access provisions
and the assurances provision.
With respect to the requirement that covered entities provide
nondiscrimination notices and taglines, the Department considered
keeping the requirement but limiting the frequency of required mailings
to one per year to each person served by the covered entity. To
estimate the cost of this option, the Department adopted the base
assumptions described in this Regulatory Impact Analysis regarding the
number of covered entities and the average unit cost associated with
the low-end and high-end costs of a notice and tagline mailing
(materials, postage, and labor).\180\ The Department adjusted the
volume of mailings based on the average number of individuals served by
each covered entity.\181\ The Department assumed the same covered
entity compliance rate for the insurance industry as under this
Regulatory Impact Analysis but assumed an increased compliance rate for
non-insurers (assuming 30% instead of 10%) to reflect that more
entities would likely comply with the requirements if the burden were
to be significantly reduced to one mailing per customer/patient per
year. Based on this method, the estimated total cost of this
alternative is approximately $63 million per year. Although this option
poses a significantly reduced burden, the Department believes the costs
under this alternative still outweigh the benefits because such mass
multi-language taglines mailings would still be received overwhelmingly
by English speakers and because the requirement to issue non-
discrimination notices would be largely duplicative of non-
discrimination notice requirements that already exist under Section
1557's underlying civil rights regulations.\182\
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\180\ The average of the low ($0.035) and high ($0.32) unit
costs is $0.18 per notice and tagline mailing.
\181\ The estimated volume is expected to vary based on covered
entity type. For instance, each of the 180 health insurance issuers
serve 685,138 individuals on average, based on the number of insured
individuals (123 million), which equates to 685,138 mailings per
issuer. Each of the 185,649 physicians' offices serve 1,703
individuals, based on the average number of individuals (316
million) associated with 990 million physicians visits. On average,
each covered entity serves about 3,000 persons per entity, which
equates to 3,000 mailings per entity, based on 820 million persons
served by 275,002 covered entities.
\182\ See 45 CFR 80.6(d) (Title VI), 84.8 (Section 504), 86.9
(Title IX), 91.32 (Age Act).
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The Department invites comment on its proposed approach, as well as
the other approaches considered by the Department.
4. Considerations for Cost-Effective Design
In this proposed rule, the Department proposes to substantially
replace most of the Section 1557 Regulation, so as to significantly
reduce the regulatory burden of compliance and to return to the pre-
existing understanding of the underlying nondiscrimination obligations
imposed by the civil rights laws referenced by Section 1557.
In the preamble to the Final Rule, the Department observed there
were pre-existing requirements under Federal civil rights laws that,
``except in the area of sex discrimination,'' applied to a large
percentage of entities covered by the Final Rule. 81 FR at 31446. Thus,
in the Final Rule the Department concluded it did not expect covered
entities to undertake additional costs with respect to the prohibitions
on discrimination on the basis of race, color, national origin, age, or
disability discrimination, ``except with respect to the voluntary
development of a language access plan.'' Id.
By proposing to repeal the Section 1557 Regulation's novel
definition of sex discrimination and to eliminate the notices,
taglines, visual standards in video remote interpreting services for
[[Page 27875]]
LEP individuals, language access plans, and duplicative grievance
procedures requirements, the proposed rule would also allow covered
entities the freedom to order their operations efficiently, flexibly,
and in a cost-effective manner.
Accordingly, returning to the familiar pre-existing requirements
and eliminating novel requirements not contemplated nor allowed by
Section 1557 is a cost-effective way of (1) removing the unjustified
burdens imposed by the Section 1557 Regulation; (2) reducing confusion
among the public and covered entities; (3) promoting consistent,
predictable, and cost-effective enforcement; and (4) creating space for
innovation in the provision of compliant services by covered entities
(including flexible and innovative language access practices and
technology), while faithfully and vigorously enforcing Section 1557's
civil rights protections.
5. Methodology for Cost-Benefit Analysis
For purposes of this Regulatory Impact Analysis (RIA), the proposed
rule adopts the list of covered entities and other costs assumptions
identified in the 2016 RIA for the Final Rule. The use of assumptions
from the 2016 rulemaking in the present RIA, however, does not mean
that the Department adopts those assumptions in any respect beyond the
purpose of estimating (1) the number of covered entities that would be
relieved of burden, and (2) cost relief. For example, the 2016
rulemaking based several cost estimates on an expansive definition of
Federal financial assistance, which significantly impacted the number
of covered entities currently burdened by the Final Rule; thus, it is
appropriate to use that definition for estimating cost relief.\183\
Such use, however, should not be interpreted as an endorsement or
acceptance of the definitions for any other purpose. Moreover, the
existing definition of Federal financial assistance under the Section
1557 Regulation is proposed to be repealed in this NPRM.
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\183\ The Department seeks public comment in particular on one
aspect of the Final Rule where there was no estimate of the number
of impacted entities: The number of religious organizations that
provide health services and receive Federal financial assistance
from the Department. The Department seeks public comment to better
estimate the impact of the proposed rule on such religious entities,
and the impact of any applicable religious exemptions that might
change the effect of the proposed rule on those entities.
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The Department also does not ``carry over'' every assumption from
the 2016 Section 1557 Regulation for this NPRM's RIA calculation
purposes. Most notably, the Department no longer considers its prior
estimates of costs imposed due to the current Section 1557 Regulation's
taglines requirement accurate or valid, and provides a more thorough
and accurate estimate for purposes of this NPRM.
Cost savings result from the repeal of (1) the provision on the
incentive for covered entities to develop language access plans and (2)
the provisions on notice and taglines. In addition, the Department
quantitatively analyzes and monetizes the impact that this proposed
rule may have on covered entities' voluntary actions to re-train their
employees on, and adopt policies and procedures to implement, the legal
requirements of this proposed rule. The Department analyzes the
remaining benefits and burdens qualitatively because of the uncertainty
inherent in predicting other concrete actions that such a diverse scope
of covered entities might take in response to this proposed rule. The
Department requests all relevant information or data that would inform
a quantitative analysis of proposed reforms that the Department
qualitatively addresses in this RIA.
6. Cost-Benefit Analysis
a. Overview
In 2016, the Department estimated $942 million \184\ in costs (over
five years) for the Section 1557 Regulation due to impacts on personnel
training and familiarization, enforcement, posting of nondiscrimination
notices and taglines, and revisions in covered entity policies and
procedures. 81 FR 31446, and 31458-31459 (at Table 5). As stated
earlier, the Department estimated in its 2016 rulemaking that these
costs would arise primarily from requirements imposed by the Section
1557 Regulation with which covered entities were not already
complying.\185\ The Department specifically identified the Final Rule's
interpretation of sex discrimination to cover gender identity and sex
stereotyping,\186\ and the Final Rule's consideration of language
access plans for compliance purposes, as provisions triggering the
imposition of new costs.\187\ See 81 FR 31459--Table 5.
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\184\ Throughout the regulatory impact analysis in the Section
1557 Regulation, the 2016 estimates used 2014 dollars unless
otherwise noted.
\185\ 81 FR 31446 (``to the extent that certain actions are
required under the final rule where the same actions are already
required by prior existing civil rights regulations, we assume that
the actions are already taking place and thus that they are not a
burden imposed by the rule'').
\186\ 81 FR 31455 (``Although a large number of providers may
already be subject to State laws or institutional policies that
prohibit discrimination on the basis of sex in the provision of
health services, the clarification of the prohibition of sex
discrimination in this regulation, particularly as it relates to
discrimination on the basis of sex stereotyping and gender identity,
may be new.'').
\187\ Although the Final Rule did not require covered entities
to develop a language access plan, the Rule stated that the
development and implementation of a language access plan is a factor
the Director ``shall'' take into account when evaluating whether an
entity is in compliance with Section 1557. 45 CFR 92.201(b)(2).
Therefore, the Department anticipated that 50% of covered entities
would be induced to develop and implement a language access plan
following issuance of the Final Rule. 81 FR 31454.
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In 2016, the Department estimated that the Final Rule's
nondiscrimination notice requirement would impose approximately $3.6
million in one-time additional costs on covered entities. 81 FR at
31469. Regarding these requirements, the Department stated: ``We are
uncertain of the exact volume of taglines that will be printed or
posted, but we estimate that covered entities will print and post the
same number of taglines as notices and therefore the costs would be
comparable to the costs for printing and disseminating the notice, or
$3.6 million.'' 81 FR at 31469. Thus, the total notice and tagline cost
was estimated at $7.2 million in the first year and was predicted to go
down to zero after year one despite the regulatory requirement for
covered entities to provide notices and taglines to beneficiaries,
enrollees, and applicants by appending notices and taglines to all
``significant publications and significant communications'' larger than
postcards or small brochures. Compare 81 FR 31458 (Table 5), with 45
CFR 92.8.
For reasons explained more fully below, the 2016 estimate of $7.2
million in one-time costs stemming from the notice and taglines
requirement was a gross underestimation, and thus this proposed rule's
elimination of those requirements would generate a large economic
savings of approximately $3.6 billion over five years based on the
proposed repeal of the notice and taglines provision.
[[Page 27876]]
Table 1--Accounting Table of Benefits and Costs of All Proposed Changes
[In millions]
----------------------------------------------------------------------------------------------------------------
Year 1 Year 2 Year 3 Year 4 Year 5 Total
----------------------------------------------------------------------------------------------------------------
Savings:
Total (undiscounted).......... $807 $789 $770 $751 $733 $3,850
Total (3%).................... 696 660 626 593 562 3,137
Total (7%).................... 575 525 479 437 399 2,416
Costs--Quantified Costs:
Total (undiscounted).......... 276 0 0 0 0 276
Total (3%).................... 238 0 0 0 0 238
Total (7%).................... 197 0 0 0 0 197
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Net Total (undiscounted).. ........... ........... ........... ........... ........... 3,574
----------------------------------------------------------------------------------------------------------------
Non quantified benefits and costs are described below.
b. Generally Applicable Tangible and Intangible Benefits and Burdens
The proposed rule would result in other tangible benefits for
covered entities. First, because the proposed rule is simple and easily
administrable, it would be less likely that covered entities would need
to pay for legal advice or otherwise expend organizational resources to
understand their obligations under Section 1557, either in general or
with respect to any particular situation that arises. Second, the
proposed rule would eliminate the need for covered entities to expend
labor and money on an ongoing basis to maintain internal procedures for
mitigating the legal risk that persists due to unresolved controversy
over the meaning of Section 1557. The Department solicits comment
regarding the nature and magnitude of such ongoing costs incurred by
covered entities.
The proposed rule would also carry intangible benefits, most
important of which is that covered entities would enjoy increased
freedom to adapt their Section 1557 compliance programs to most
efficiently address their particular needs, benefiting both covered
entities and individuals. The value of knowledge of civil rights is
difficult to quantify. Covered entities would be free under the
proposed rule to implement policies and procedures that comply with
Federal civil rights laws in creative, effective, and efficient ways
that are tailored to the covered entities and the communities that they
serve.
The Section 1557 Regulation likely induced many covered entities to
conform their policies and operations to reflect gender identity as
protected classes under Title IX. The Department anticipates that, as a
result of the proposed rule, some--but not all--covered entities may
revert to the policies and practices they had in place before the
agency actions that created confusion regarding Title IX's definition
of discrimination on the basis of sex.\188\ Such a reversion may
naturally entail amending organizational nondiscrimination policies and
training materials, and communicating those changes to employees. The
process of voluntarily reverting to previous practices would cost
covered entities some time and money. In addition, the Department
believes that, under the proposed rule, some covered entities would no
longer incur labor costs pursuant to the Section 1557 Regulation
associated with processing grievances related to sex discrimination
complaints as they relate to gender identity under Title IX because
such claims would not be cognizable under the proposed rule.
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\188\ Covered entities located in jurisdictions that prohibit
sexual orientation and gender identity discrimination under State or
local laws likely already have policies, training, or grievance
procedures concerning sexual orientation and gender identity and
likely would not change their policies under the proposed rule.
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The Department, however, is uncertain as to the total number of
covered entities that would change their policies and grievance
processes to reflect the understanding of sex discrimination set forth
in this proposed rule. It anticipates that such changes would be
influenced by a number of factors, including applicable State and local
laws, along with the covered entities' experiences in implementing the
previous definition. Accordingly, the Department, at this time, cannot
estimate the number of covered entities that would revert to the
previous interpretation of ``sex'' under their internal policies and
operations and the related cost and benefits from such change in
behavior. The Department solicits public comments and data on this
question.
Consequently, the Department also lacks the data necessary to
estimate the number of individuals who currently benefit from covered
entities' policies governing discrimination on the basis of gender
identity who would no longer receive those benefits as a consequence of
the rule--notwithstanding that nothing in the rule precludes covered
entities from continuing such policies voluntarily. The Department
seeks comments on this question.
The Department also solicits comments regarding this and other
intangible benefits that would be conferred by this proposal.
c. Baseline Assumptions
The following discussion identifies the economic baseline from
which the Department measures the expected costs and benefits of the
proposed rule. Its baseline includes the cost estimates in the Final
Rule, in addition to data it has gathered since the Final Rule was
implemented, as described in more detail below.
Key assumptions include the following: (1) The Final Rule triggered
significant voluntary activity on the part of covered entities,
generating both costs and benefits; (2) covered entities were already
complying with civil rights laws and related regulations that were in
effect before the Final Rule and, thus, the proposed rule does not
impose any new burden by reaffirming the requirements of those laws;
(3) the projected costs from the Final Rule for years 1 and 2 have been
incurred, and the projected costs from years 3, 4, and 5 have not been
incurred; (4) repeal of the Final Rule's notice and taglines
requirements would not affect notice or tagline requirements required
by Centers for Medicare & Medicaid Services guidance or regulations
that do not reference, rely on, or depend upon the taglines
requirements of the Final Rule; (5) a relatively small percentage of
physicians and hospitals currently append notices and taglines to
billing statements sent to patients, while all insurance companies
append notices and taglines to their explanations of benefits
statements; and (6) covered employers are more likely to train
[[Page 27877]]
employees who interact with the public than those who do not.
d. Covered Entities
(1) Entities Covered by Section 1557
The Final Rule and the proposed rule replacing Section 1557 apply
to any entity that has a health program or activity, any part of which
receives Federal financial assistance from the Department, any program
or activity administered by the Department under Title I of the PPACA,
or any program or activity administered by an entity established under
such Title. Covered entities under the current rule's definition \189\
include:
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\189\ As noted above, we use the list and number of covered
entities and other figures from the 2016 Final Rule's RIA in this
RIA for the sake of consistency and convenience, but such use does
not mean that we adopt or accept any of the underlying analysis,
definitions, or assumptions from the Final Rule's RIA for any other
purpose related to this proposed rule.
---------------------------------------------------------------------------
(a) Entities With a Health Program or Activity, Any Part of Which
Receives Federal Financial Assistance From the Department
The RIA for the Final Rule stated that the Department, through
agencies such as the Health Resources and Services Administration
(HRSA), the Substance Abuse and Mental Health Services Administration
(SAMHSA), the Centers for Disease Control and Prevention (CDC), and the
Centers for Medicare & Medicaid Services (CMS), provides Federal
financial assistance through various mechanisms to health programs or
activities of local governments, State governments, and the private
sector. An entity may receive Federal financial assistance from more
than one component in the Department. For instance, federally qualified
health centers receive Federal financial assistance from CMS by
participating in Medicaid programs and may also receive Federal
financial assistance from HRSA through grant awards. Because more than
one funding stream may provide Federal financial assistance to an
entity, the examples we provide may not uniquely capture entities that
receive Federal financial assistance from only one component of the
Department. Under the Final Rule, the covered entities consisted of the
following:
(i) Entities receiving Federal financial assistance through their
participation in Medicare (excluding Medicare Part B) or Medicaid
(about 133,343 facilities).\190\ Examples of these entities cited in
the 2016 RIA include:
---------------------------------------------------------------------------
\190\ CMS, Provider of Service file (June 2014), https://www.cms.gov/Research-Statistics-Data-and-Systems/Downloadable-Public-Use-Files/Provider-of-Services/POS2014.html.
Hospitals (includes short-term, rehabilitation, psychiatric,
and long-term)
Skilled nursing facilities/nursing facilities (facility-based
and freestanding)
Home health agencies
Physical therapy/speech pathology programs
End stage renal disease dialysis centers
Intermediate care facilities for individuals with intellectual
disabilities
Rural health clinics
Physical therapy--independent practice
Comprehensive outpatient rehabilitation facilities
Ambulatory surgical centers
Hospices
Organ procurement organizations
Community mental health centers
Federally qualified health centers
(ii) Laboratories that are hospital-based, office-based, or
freestanding that receive Federal financial assistance through Medicaid
payments for covered laboratory tests (about 445,657 laboratories with
Clinical Laboratory Improvement Act certification).
(iii) Community health centers receiving Federal financial
assistance through grant awards from HRSA (1,300 community health
centers).\191\
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\191\ HRSA, Justification of Estimates for Appropriation
Committee For Fiscal Year 2016, 53, http://www.hrsa.gov/about/budget/budgetjustification2016.pdf.
---------------------------------------------------------------------------
(iv) Health-related schools in the United States and other health
education entities receiving Federal financial assistance through grant
awards to support 40 health professional training programs that include
oral health, behavioral health, medicine, geriatric, and physician's
assistant programs.\192\
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\192\ HRSA, Justification of Estimates for Appropriation
Committee For Fiscal Year 2016, 53, http://www.hrsa.gov/about/budget/budgetjustification2016.pdf.
---------------------------------------------------------------------------
(v) State Medicaid agencies receiving Federal financial assistance
from CMS to operate CHIP (includes every State, the District of
Columbia, Puerto Rico, Guam, the Northern Marianas, U.S. Virgin
Islands, and American Samoa).
(vi) State public health agencies receiving Federal financial
assistance from CDC, SAMHSA, and other HHS components (includes each
State, the District of Columbia, Puerto Rico, Guam, the Northern
Marianas, U.S. Virgin Islands, and American Samoa).
(vii) Qualified health plan issuers receiving Federal financial
assistance through advance payments of premium tax credits and cost-
sharing reductions (which include at least the 169 health insurance
issuers in the Federally-facilitated Exchanges receiving Federal
financial assistance through advance payments of premium tax credits
and cost sharing reductions and at least 11 health insurance issuers
operating in the State Exchanges).\193\
---------------------------------------------------------------------------
\193\ Qualified Health Plans Landscape Individual Market Medical
(2015), https://data.healthcare.gov/dataset/2015-QHP-Landscape-Individual-Market-Medical/mp8z-jtg7.
---------------------------------------------------------------------------
(viii) Physicians receiving Federal financial assistance through
Medicaid payments, ``meaningful use'' payments, and other sources, but
not Medicare Part B payments; Medicare Part B payments to physicians
are not Federal financial assistance. The Medicare Access and CHIP
Reauthorization Act amended Section 1848 of the Act to sunset
``meaningful use'' payment adjustments for Medicare physicians after
the 2018 payment adjustment.
In the 2016 rulemaking, the Department estimated that the Final
Rule likely covers almost all licensed physicians because they accept
Federal financial assistance from sources other than Medicare Part B.
Many physicians participate in more than one Federal, State, and local
health program that receives Federal financial assistance, and many
practice in several different settings which increases the possibility
that they may receive payments constituting Federal financial
assistance.
For the sake of consistency and convenience, the Department uses
the 2016 RIA estimate of the number of physicians receiving Federal
financial assistance. As the 2016 RIA noted, based on 2010 Medicaid
Statistical Information System data (the latest available), about
614,000 physicians accept Medicaid payments and are covered under
Section 1557 as a result.\194\ This figure represents about 69% of
licensed physicians in the United States when compared to the 890,000
licensed physicians reported in the Area Health Resource File.\195\ In
addition, physicians receiving Federal payments from non-Part B
Medicare sources will also come under Section 1557. The 2016 RIA noted
that, as of
[[Page 27878]]
January 2014, 296,500 Medicare-eligible professionals had applied for
funds to support their ``meaningful use'' technology efforts.\196\
Adding the approximately 614,000 physicians who receive Medicaid
payments to the 296,500 physicians who receive meaningful use payments
yields over 900,000 physicians potentially reached by Section 1557
because they participate in Federal programs other than Part B of
Medicare. Because physicians can receive both Medicaid and meaningful
use payments, and these figures are not adjusted for duplication, the
900,000 result is best interpreted as an upper bound.
---------------------------------------------------------------------------
\194\ John Holahan and Irene Headen, Kaiser Commission on
Medicaid and the Uninsured, Medicaid Coverage and Spending in Health
Reform: National and State-by-State Results for Adults at or Below
133% FPL (2010), https://kaiserfamilyfoundation.files.wordpress.com/2013/01/medicaid-coverage-and-spending-in-health-reform-national-and-state-by-state-results-for-adults-at-or-below-133-fpl.pdf.
Estimates are based on data from FY 2010 MSIS.
\195\ HRSA, Area Health Resource Files (2015), http://ahrf.hrsa.gov.
\196\ Mynti Hossain and Marsha Gold, Mathematical Policy
Research Inc.: Prepared for The Office of the National Coordinator
for Health Information Technology, HHS, Monitoring National
Implementation of HITECH: Status and Key Activity Quarterly Summary
(Jan. to Mar. 2014), http://www.healthit.gov/sites/default/files/globalevaluationquarterlyreport_januarymarch2014.pdf.
---------------------------------------------------------------------------
When the Department compared the upper bound estimated number of
physicians participating in Federal programs other than Medicare Part B
(over 900,000) to the number of licensed physicians counted in HRSA's
Area Health Resource File (approximately 890,000), and allowing for
duplication in both the Medicare/Medicaid and HRSA numbers,\197\ the
Department concluded in the 2016 RIA that almost all practicing
physicians in the United States are reached by Section 1557 because
they accept some form of Federal remuneration or reimbursement apart
from Medicare Part B.
---------------------------------------------------------------------------
\197\ The Area Health Resource File itself double counts
physicians who are licensed in more than one State.
---------------------------------------------------------------------------
The Department invites the public to submit information regarding
physician participation in health programs or activities that receive
Federal financial assistance.
(b) Programs or Activities Administered by the Department Under Title I
of the PPACA
This proposed rule applies to programs or activities administered
by the Department under Title I of the PPACA. Such programs or
activities include temporary high risk pools (section 1101), temporary
reinsurance for early retirees (section 1102), Department mechanisms
for identifying affordable health insurance coverage options (section
1103), the wellness program demonstration project (section 1201, adding
Public Health Service (PHS) Act 2705(l)), the provision of community
health insurance options (section 1323), and the establishment of risk
corridors for certain plans (section 1342).
(c) Entities Established Under Title I of PPACA
This proposed rule applies to the health insurance exchanges
established under Title I of PPACA. Such exchanges currently include
the 12 State Exchanges, 5 State Exchanges on the Federal platform and
34 Federally-facilitated Exchanges.\198\ Title I additionally
establishes State advisory councils concerning community health
insurance (section 1323) and certain reinsurance entities under the
transitional reinsurance program (section 1341).
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\198\ CMS, State-Based Exchanges for Plan Year 2018 (Nov. 13,
2018), https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/state-marketplaces.html.
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(2) Entities Covered by Title IX
Title IX applies to recipients of Federal financial assistance for
education programs or activities. 20 U.S.C. 1681. The population of
applicable covered entities is defined by the term ``recipient'' in the
Department's Title IX regulations. The population includes any State or
political subdivision thereof, or any instrumentality of a State or
political subdivision thereof, any public or private agency,
institution, or organization, or other entity, or any person, to whom
Federal financial assistance is extended directly or through another
recipient and that operates an education program or activity that
receives such assistance, including any subunit, successor, assignee,
or transferee thereof. See, e.g., 45 CFR 86.2. Under the definition of
program or activity, recipients of Federal financial assistance within
the scope of Title IX may include colleges, universities, local
educational agencies, vocational education systems, or other entities
or organizations principally engaged in the business of providing
education. See, e.g., 45 CFR part 86, appendix A (cross-referencing
appendix B to 45 CFR part 80).
e. Cost Savings From Eliminating Notice and Taglines Requirement
The Department's baseline for calculating the savings from
repealing the notice and taglines requirement includes approximately
$0.632 billion in additional average annual costs from the requirement
that were not considered in the 2016 rulemaking. It is important to
note that, while industry estimates prompted the Department to reassess
the burdens imposed by the Final Rule, the Department conducted and
relied upon its own cost analysis in developing the RIA for this
proposed rule.
The Final Rule assessed $7.1 million for covered entities and
$70,400 for the Federal government in combined annual costs for
printing and distributing nondiscrimination notices and taglines, with
the costs being apportioned roughly equally between notices and
taglines. 81 FR 31453. As explained in detail below, the Department
estimates the combined notice and taglines requirement actually costs
covered entities hundreds of millions of dollars per year, as explained
in this analysis.
The Final Rule requires covered entities to include a notice and
taglines for any ``significant'' document or publication, but did not
define the term ``significant.'' 45 CFR 92.8(f)(1)(i).\199\ Thus,
covered entities have reasonably interpreted this provision to require
a notice and taglines to accompany many communications from covered
entities, including annual benefits notices, medical bills from
hospitals and doctors, explanations of benefits from health insurance
companies or health plans, and communications from pharmacy benefit
managers.
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\199\ After publishing the Final Rule, OCR issued guidance
explaining that any significant publication printed on an 8.5 x 11
sheet of paper is not considered small sized and, thus, must include
a minimum of 15 taglines. See OCR, Question 23, General Questions
about Section 1557 (May 18, 2017), https://www.hhs.gov/civil-rights/for-individuals/section-1557/1557faqs/index.html.
---------------------------------------------------------------------------
Covered entities such as plan administrators and pharmacy benefit
managers have reasonably interpreted this guidance to require a notice
and taglines for an extraordinary amount of mailed communications,
including every auto-ship refill reminder, formulary notice, and
specialty benefit letter. Further, some other entities that operate in
multiple States have interpreted the Final Rule as requiring them to
include taglines for as many as 60 languages, or to include that many
taglines in mailed communications due to the cost or technical barriers
to customizing mailing inserts on a State-by-State basis and, thus,
have incurred costs to send up to an additional two double-sided pages
of notices with each communication.\200\
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\200\ Although OCR has issued guidance stating that a covered
entity may identify the top 15 languages spoken across all the
States that the entity serves, see https://www.hhs.gov/civil-rights/for-individuals/section-1557/1557faqs/aggregation_tagline/index.html, evidence of notices that some covered entities shared
with OCR suggests covered entities with beneficiaries in multiple
States may issue more comprehensive tagline notices exceeding 15
languages, likely because of reasonable interpretations of the
relevant provisions of the Final Rule.
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To estimate the volume of notices and taglines that accompany an
annual
[[Page 27879]]
benefits notice, we began with the approximately 300 million persons in
the United States who have health insurance,\201\ or approximately 91%
of the U.S. population. The Department then assumed that the annual
notice of benefits (that includes a notice and taglines) is sent to
each policyholder, not to each individual member of a covered
household, such as covered children. Of the total U.S. population, 306
million individuals belong to 117.7 million households. For the data
set relied on, a ``household'' includes ``all the people who occupy a
housing unit. . . . The occupants may be a single family, one person
living alone, two or more families living together, or any other group
of related or unrelated people \202\ who share living
arrangements.''\203\ By implication, 17.3 million individuals do not
belong to a household,\204\ and live in group quarters.\205\ The
Department assumed that the percentage of the U.S. population that is
uninsured, 9%, is the same percentage of U.S. individuals belonging to
U.S. households that are uninsured. To calculate the number of annual
benefits notices, the Department added the total number of individuals
that do not belong to a household (17.3 million) to the total number of
households (117.7 million), and discounted the sum (135 million) by 9%
to exclude those individuals who are not insured. The total number of
annual notices of benefits that include a nondiscrimination notice and
taglines is therefore approximately 123 million (approximately 91% of
135 million).
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\201\ Calculated by subtracting total uninsured population (28.1
million as of 2016), see https://www.census.gov/library/publications/2017/demo/p60-260.html, from the total U.S. Population
(327,350,075 as of March 14, 2018), see https://www.census.gov/popclock.
\202\ The calculations do not take into account households where
two or more unrelated persons have individual coverage, and thus
receive separate annual notices at the same household. The
Department believes, however, that this exclusion has only a minor
impact on the overall figures but welcome comments on whether they
should be included.
\203\ U.S. Census Bureau, American Community Survey and Puerto
Rico Community Survey 2016 Subject Definitions 76, https://www2.census.gov/programs-surveys/acs/tech_docs/subject_definitions/2016_ACSSubjectDefinitions.pdf (defining ``household'' under
``Household Type and Relationship'').
\204\ The Department subtracted 306 million individuals
belonging to a household from the total US population in of 323.4
million individuals. See U.S. Census Bureau, https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk (relied on 2016 population nationally).
\205\ U.S. Census Bureau, American Community Survey and Puerto
Rico Community Survey 2016 Subject Definitions 76, https://www2.census.gov/programs-surveys/acs/tech_docs/subject_definitions/2016_ACSSubjectDefinitions.pdf (``People not living in households
are classified as living in group quarters.''). ``Group quarters
include . . . college residence halls, . . . skilled nursing
facilities, . . . correctional facilities, and workers'
dormitories.'' U.S. Census Bureau, 2016 American Community Survey/
Puerto Rico Community Survey Group Quarters Definitions, 1 https://www2.census.gov/programs-surveys/acs/tech_docs/group_definitions/2016GQ_Definitions.pdf.
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To estimate the volume of notices and taglines that accompany auto-
reenrollment communications from the health insurance Exchanges, the
Department assumes the Exchanges send these communications to the 11.8
million individuals enrolled in the individual market.\206\ It assumes
that the Exchanges send out approximately 1.5 notices per person per
year. This accounts for the annual re-enrollment communication plus
additional communications Exchanges will send for special enrollment
periods. Thus, the total estimated volume of notices and taglines
attributable to the Exchanges is 17.7 million.
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\206\ See CMS, Health Insurance Exchanges 2018 Open Enrollment
Period Final Report (Apr. 3, 2018), https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2018-Fact-sheets-items/2018-04-03.html.
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To estimate the volume of notices and taglines that accompany
hospital bills and explanations of benefits sent by insurance companies
(or health plans) for hospital admissions, the Department first
estimated the total number of hospital bills and explanation of
benefits that would be sent to patients annually. There are 35,158,934
million hospital admissions per year.\207\ For the purpose of this
estimate, the Department assumes that each admission generates three
bills from one hospital visit--each of which would include a notice and
tagline document, for a total of 105,476,802 bills (35,158,934
admissions times three bills per admission).\208\ The Department
assumes that 10% of the 105,476,802 bills will have a notice and
tagline document attached, for a total of 10,547,680 notice and tagline
documents.
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\207\ CDC, Chartbook on Long-Term Trends in Health (2016),
http://www.cdc.gov/nchs/data/hus/hus16.pdf#317.
\208\ The Department presumes one hospital visit likely will
generate a bill from the physician and two bills from any
combination of services, such as anesthesia, ambulance service,
imaging/radiology, or laboratory or blood work.
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For patients who were insured upon admission to the hospital, in
addition to the three hospital bills they would receive (on average),
they would receive three associated explanations of benefits from their
insurer or health plan, each of which would also include notice and
tagline documents. If more than three service providers bill a patient
for a hospital visit, then the savings associated with this patient
encounter would be greater than estimated due to the additional notice
and tagline documents that the insurer would send with each additional
explanation of benefits beyond the initial three assumed. If less than
three service providers bill for a hospital visit, then the savings
would be less due to the decreased volume of notice and tagline
documents that the insurer would send given that the insurer would send
fewer than three explanation of benefits. Given that approximately 91%
of the U.S. population is insured, the Department estimates that
approximately 32,104,054 admissions of the 35,158,934 million hospital
admissions are associated with insured patients (91% of 35,158,934
million hospital admissions).\209\ This assumption does not account for
variation in health care consumption between the insured and uninsured
populations. It is possible that more hospital admissions are
attributable to the uninsured than the insured population. If such is
the case, the Department's estimate for the number of notices and
taglines attributable to explanations of benefits would be lower.
Further, this estimate does not account for outpatient hospital visits,
which would increase the volume of notices and taglines.
---------------------------------------------------------------------------
\209\ Calculated by subtracting total uninsured population (28.1
million as of 2016), see https://www.census.gov/library/publications/2017/demo/p60-260.html, from the total U.S. Population
in 2016 (323,405,935), see https://www.census.gov/popclock. The
Department also notes that Gallup recently conducted a study that
shows that 12.2% of the U.S. Population is uninsured. See Zac Auter,
U.S. Uninsured Rate Steady at 12.2% in Fourth Quarter of 2017 (Jan.
16, 2016), http://news.gallup.com/poll/225383/uninsured-rate-steady-fourth-quarter-2017.aspx?g_source=Well-Being&g_medium=newsfeed&g_campaign=tiles.
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As discussed further below, the Department assumes 100% of
insurance companies are compliant with the notice and taglines
requirement. Thus, approximately 96 million notice and tagline
documents are attributable to the explanations of benefits sent by
insurers (32,104,054 admissions times three explanation of benefits).
Using rounded values, approximately 107 million additional notices and
taglines (96 million plus 11 million) are related to hospital
admissions.
To estimate the volume of notices and taglines that accompany
doctor's bills and explanations of benefits from a physician's visit,
the Department relied on data showing that individuals visit a doctor
approximately 990 million times each year.\210\ Given that
approximately
[[Page 27880]]
9% \211\ of Americans are uninsured, the Department assumes (and
subtracting an estimated 5% for uninsured patients who do not visit the
doctor, except in an emergency), 95% of individuals who see doctors
every year are insured in some form. The Department assumes that each
visit to a compliant doctor's office will generate at least one bill
from the doctor and at least one explanation of benefits from the
health insurance company. As explained below, it also assumes that 10%
of doctors and 100% of insurance companies comply with the notice and
taglines requirement. Thus, approximately 99 million notices and
taglines are attributable to doctors billing the patients directly and
approximately 941 million are attributable to explanations of benefits
sent by insurers which results in a total of 1.04 billion additional
notices and taglines related to physician visits. The Department seeks
comment on these cost estimates, the frequency of communications to
which taglines and notices are sent, and how often insurers mail (other
otherwise, provide copies in person or via electronic delivery)
documents to the ensured.
---------------------------------------------------------------------------
\210\ CDC, Ambulatory Care Use and Physician Office Visits
(2016), https://www.cdc.gov/nchs/fastats/physician-visits.htm. As
noted above, the Department relies on the 2016 RIA assumption that
virtually all doctors receive Federal financial assistance and,
thus, are subject to the 2016 Final Rule.
\211\ Calculated by subtracting total uninsured population (28.1
million as of 2016), see https://www.census.gov/library/publications/2017/demo/p60-260.html, from the total U.S. Population
in 2016 (323,405,935), see https://www.census.gov/popclock.
---------------------------------------------------------------------------
Because experience and substantial feedback from health care
insurers suggests a very high degree of compliance with the notice and
taglines requirements concerning documents such as explanations of
benefits, the Department has presumed 100% compliance for purposes of
this RIA. Anecdotal evidence, however, suggests that hospital and
physician compliance with the notice and tagline requirements in the
documents discussed above is not standard industry practice. The
Department estimates that, at most, 10% of such covered entities
include notices and taglines in their significant mailed communications
with patients. While, according to the 2016 RIA, most hospitals and
physicians are covered entities under Section 1557, the Department
believes their failure to adopt notices and taglines as a standard
billing and communication practice may be due to the fact the notice
and taglines requirement in the Final Rule mentions a duty to notify
``beneficiaries, enrollees, applicants, and members of the public'' and
does not explicitly mention ``patients.'' 45 CFR 92.8(a). Additionally,
the preamble to the Final Rule explained that the notice and taglines
requirement covered communications ``pertaining to rights or benefits''
which insurance companies have universally interpreted as applying to
significant numbers of communications they send to beneficiaries. 81 FR
31402. For these reasons, the Department's calculations presume a 10%
compliance rate for hospitals and physicians and a 100% compliance rate
by health insurance companies concerning the notice and taglines
requirement as it relates to bills and explanations of benefits,
respectively.
To estimate the volume of notices and taglines that accompany
pharmacy-related communications, the Department relied on estimates
from the Pharmaceutical Care Management Association, which, due to the
nature of its organization, obtained an estimated number of impacted
beneficiaries from its member organizations. Approximately 173 million
beneficiaries are being impacted annually by the notice and taglines
requirement, and these beneficiaries receive between 6 and 28
communications per year with an accompanying notice and taglines. The
Department relied the average of this estimate (17 communications per
year per beneficiary) to determine that 2.9 billion prescription-
related communications (e.g., communications from pharmacy benefit
managers) are sent each year.\212\
---------------------------------------------------------------------------
\212\ Source: Pharmaceutical Care Management Association (May 2,
2017).
---------------------------------------------------------------------------
The Department seeks comment on these calculations. In particular,
it requests that commenters identify significant communications sent by
covered entities that include a notice and taglines that have not been
considered by this analysis, as well as the estimated annual volume for
such communications. The Department also seeks comment on whether the
estimates in this RIA for covered communications (communications
subject to the notice and taglines requirement) by health insurance
companies or pharmacy benefit managers are reasonable. The Department
also seeks comment on the cost burden of, how many entities utilize,
how many beneficiaries opt for receipt of, and the expected
effectiveness to LEP individuals of, providing non-paper notices or
taglines relevant communications related to prescriptions or
explanations of benefits. The Department also seeks comment from small,
community, and independent providers and pharmacy benefit managers
about notices of availability of language assistance services for LEP
individuals.
To calculate the costs of the notice and taglines requirement, the
Department assumes that the underlying communication to which a
nondiscrimination notice and taglines document is attached is a
communication that is on average three sheets of paper or less.
Combined with the nondiscrimination notice and taglines (which
constitute another 1-4 sides of a page, that is, 1 sheet single-sided
\213\ to 2 sheets of paper double-sided), the total number of sheets of
paper that would be transmitted is equivalent to 4-5 sheets of paper or
less. The associated costs of the notice and taglines requirement are
(1) materials, (2) postage, and (3) labor. Because of the uncertainty
around some of the estimates, we report ranges for some values in this
analysis.
---------------------------------------------------------------------------
\213\ Although this cost-benefit analysis assumes a lower-bound
estimate that a notice of nondiscrimination and 15 taglines may be
printed on one side of one sheet of paper, HHS believes that a
notice of that length is likely noncompliant with the current
Section 1557 rule requirement to be posted ``in conspicuously-
visible font size.'' See also OCR, Sample Notice Informing
Individuals About Nondiscrimination and Accessibility Requirements
and Sample Nondiscrimination Statement: Discrimination is Against
the Law (printed on two sides of one sheet of paper), https://www.hhs.gov/sites/default/files/sample-ce-notice-english.pdf.
---------------------------------------------------------------------------
For materials, the Department assumes that materials (paper and
ink) per notice and taglines mailing insert will cost between $0.025
and $0.10. The Department assumes that low materials cost would be
$0.025 to print a 1-page notice and taglines on a single sheet of paper
single-sided, and the high materials cost of $0.10 to print a 4-page
notice and taglines on 2 sheets of paper double sided. The Department
seeks comment on its estimate of the length of the materials, including
whether the required notice and taglines could have fit on one side of
one page only, and how often entities did so in compliance with the
requirement, as opposed to using 2-4 sides of a page.
For postage, the Department estimates that the additional weight of
the notice and tagline inserts result in a range of no incremental
postage costs (low-end) to $0.21 per mailing (high-end). For instance,
if an underlying communication is three sheets of paper or less, a
covered entity's inclusion of one double-sided page (or shorter) of
notice and taglines insert would likely weigh one ounce or less
(approximately four letter-sized pages weigh one ounce).\214\
Consequently, in this
[[Page 27881]]
scenario, the notice and taglines insert would not increase the total
weight of the mailing beyond the one ounce of postage that a covered
entity would already expect to incur. If, however, a covered entity
included 2 sheets of paper double-sided containing the
nondiscrimination notice and taglines, added to a communication of
three sheets of paper or more,, the total weight of the mailing would
likely be at least five sheets of paper, and therefore over one ounce.
The marginal cost of postage for each ounce is $0.21.\215\ The
Department seeks comment on whether and how often the required notice
and tagline inserts are inserted in larger mailings so as not to
implicate the higher end of the estimated incremental postage costs.
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\214\ See ``How Many Sheets of Paper Fit in a 1 Ounce Envelope
for Mailing Purposes,'' https://www.reference.com/business-finance/many-sheets-paper-fit-1-ounce-envelope-mailing-purposes-84ba93a60789c2e1.
\215\ See U.S. Postal Service Postage Rates, https://www.stamps.com/usps/current-postage-rates/.
---------------------------------------------------------------------------
For labor, the Department estimates the burden to download, print,
and include these notices and taglines with all significant
communications for an office clerk (Occupation Code No. 43-9061) with a
mean hourly wage of $16.92/hour \216\ plus an additional $16.92/hour in
fringe benefits, or $33.84/hour for labor costs.\217\ Based on
experience, entities can manually fold and insert notices and taglines
into envelopes at a rate of approximately 360 per hour. Entities that
use commercial machines can fold and insert notices and taglines as
fast as 5,400 envelopes per hour.\218\ The Department uses the median
of 2,520 notices and taglines that can be folded and placed into an
envelope in an hour. Under these assumptions, the unit labor cost per
notice and taglines mailing is $0.01, or $56.2 million per year.
---------------------------------------------------------------------------
\216\ BLS, Occupational Employment and Wages (May 2018), https://www.bls.gov/oes/2018/may/oes_nat.htm.
\217\ CMS estimates that the labor costs would be a one-time
cost of $16,244 for Medicaid managed care and a one-time cost of
$9,669 for CHIP managed care. The Department assumes for its
calculations that the labor costs for the notice and tagline
provisions are not one-time but are ongoing costs associated with
the value of office clerks' time printing and including the notices
and taglines with significant publications and significant
communications.
\218\ See, e.g., Pitney Bowes, Relay Mid to High Volume Inserter
Systems, https://www.pitneybowes.com/us/shipping-and-mailing/inserters-sorters-printers/relay-mid-high-volume-inserting-systems.html.
---------------------------------------------------------------------------
Considering materials, postage and labor, the per-unit cost for the
notice and taglines insert ranges from $0.035 at the low-end (for one
single-sided sheet of paper of notice and taglines) and $0.32 at the
high-end (for two double-sided sheets of paper of notice and taglines)
if the Department assumes that the average underlying mailer is 3
sheets of paper. In addition, the Department estimates that some of
these costs would be mitigated absent regulatory action, due to
transitions to electronic delivery for some communications affected by
the rule. The Department estimates electronic delivery would reduce
costs of affected communications by approximately 10-20% absent
regulatory action, shifting linearly from 10% in the first year to 20%
in the fifth year following implementation. Electronic delivery would
eliminate postage costs, but may merely shift the costs of paper and
printing from the entity providing the communication to the consumer/
beneficiary/patient, given that some consumer/beneficiary/patient
recipients of electronic communications will print them out and incur
costs for the paper and ink associated with doing so. The Department
has not included such consumer/beneficiary/patient costs in its
estimates, but requests comments on this issue, including on whether
there is a higher likelihood of electronic use than assumed here.
The Department averages the low and high-end estimates to determine
a primary estimate of annual cost savings, which results in average
savings of approximately $0.632 billion per year after adjusting for
electronic delivery.
These cost estimates are based on the Department's own research and
extensive feedback from covered entities. It invites comment on these
estimates, in particular the average numbers of pages sent by covered
entities and the costs for publishing and distributing notices and
taglines that may be borne by covered entities or types of transactions
that it has not identified in this discussion.
With repeal of the Final Rule requirements, the Department assumes
that two other regulatory requirements for taglines would also be fully
repealed because they depend on, or refer to, the Final Rule for
authority for the tagline requirement. The first is the requirement
placed on Health Insurance Exchanges (see 45 CFR
155.205(c)(2)(iii)(A)), which the Department estimates issue 17.7
million communications per year, primarily through eligibility and
enrollment communications. The second is the requirement placed on
Qualified Health Plan Issuers (see HHS Notice of Benefit and Payment
Parameters for 2016; Final Rule, 80 FR 10750, 10788 (Feb. 27, 2015)),
whose costs are incorporated into the volume calculations for annual
notices of benefits, and explanations of benefits discussed in more
detail above. The Department also assumes that health insurance
entities would not voluntarily append notices and taglines to routine
monthly premium statements absent the Final Rule, but are doing so
because of it (or because of a requirement in another regulation which
bases its requirement on the Section 1557 Regulation's requirement).
Table 2--Annual Savings From Repeal of Requirement To Publish and Mailing Notices and Taglines, by Volume of
Transactions per Type per Year Before Accounting for Electronic Delivery
[In millions]
----------------------------------------------------------------------------------------------------------------
Estimated low Estimated high
Count savings savings ($0.32/
($0.035/unit) unit)
----------------------------------------------------------------------------------------------------------------
Exchange enrollment communications.............................. 17.7 $0.62 $5.66
Annual notice of benefits....................................... 123 4.32 39.46
Explanations of Benefits--hospital admissions................... 96 3.37 30.82
Explanations of Benefits--physician's visits.................... 941 32.93 301.05
Medical bills--hospital admissions.............................. 11 0.37 3.38
Medical bills--physician visits................................. 99 3.47 31.69
Pharmacy-related notices........................................ 2,900 101.50 928.00
-----------------------------------------------
Subtotal, not accounting for electronic communications...... 4,188 146.57 1,340.06
----------------------------------------------------------------------------------------------------------------
[[Page 27882]]
The average of the low and high end estimates yields a primary
estimate of annual savings of approximately $0.632 billion after
accounting for electronic delivery. The Department assumes that the
nine other CMS regulations or guidelines requiring taglines will
continue to be in effect, and the cost of complying with these CMS
requirements would need to be subtracted from the total savings that
the Section 1557 Regulation's rescission generates for the health care
sector as set forth in Table 2. These requirements include (1) Group
Health Plans and Health Insurance Issuers requirements; \219\ (2)
Navigator requirements; \220\ (3) Non-Navigator Assistance Personnel
requirements; \221\ Medicaid requirements; \222\ Medicaid Managed Care
requirements \223\ CHIP requirements; \224\ CHIP Managed Care
requirements; \225\ Hospitals Qualifying for Tax-Exempt Status
requirements; \226\ and Medicare Advantage (Part C) and Prescription
Drug Plans (Part D) requirements.\227\ Because the Department's
previous rulemaking on these CMS tagline requirements did not attempt
to estimate these costs, it invites comment on cost implications here.
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\219\ 45 CFR 147.136(e)(2)(iii) and (e)(3), and 147.200(a)(5).
\220\ 45 CFR 155.215(c)(4).
\221\ 45 CFR 155.215(c)(4).
\222\ 42 CFR 435.905(b)(3).
\223\ 42 CFR 438.10(d)(2) through (3), (d)(5)(i) and (iii), and
(j).
\224\ 42 CFR 457.340(a).
\225\ 42 CFR 457.1207.
\226\ 26 CFR 1.501(r)-4(b)(5)(ii).
\227\ Medicare Marketing Guidelines Sec. 30.5.1, https://www.cms.gov/Medicare/Health-Plans/ManagedCareMarketing/FinalPartCMarketingGuidelines.html.
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Other burdens imposed by the Final Rule's notice and taglines
requirements are real, but difficult to quantify.
The vast majority of recipients of taglines do not require
translation services. For example, according to Census statistics, as
of 2015, over three-quarters (79%) of the U.S. population over age 18
speak only English at home, followed by Spanish (12.5%).\228\
Additionally, of persons selecting a language preference when
registering for coverage on the HealthCare.gov platform for 2017,
89.93% selected English, followed by 8.36% who selected Spanish.\229\
These data points indicate that, for the large majority of people who
receive them, the required language tagline mailings provide little to
no benefit because they are already proficient English speakers with
little need for, and no entitlement under the law to, translation
services.
---------------------------------------------------------------------------
\228\ U.S. Census Bureau, B16007: Age by Language Spoken at Home
for the Population 5 Years and Over, 2011-2015 American Community
Survey (American FactFinder) (2017), https://factfinder.census.gov/bkmk/table/1.0/en/ACS/16_5YR/S1601/0100000US. See also Kimberly
Proctor, Shondelle M. Wilson-Frederick, et al., The Limited English
Proficient Population: Describing Medicare, Medicaid, and Dual
Beneficiaries, 2.1 Health Equity 87 (May 1, 2018), http://online.liebertpub.com/doi/10.1089/heq.2017.0036 (identifying Spanish
as the language of the largest majority of limited English
proficient speakers in Medicaid and Medicare, according to the 2014
American Community Survey).
\229\ CMS, Race, Ethnicity, and Language Preference in the
Health Insurance Marketplaces 2017 Open Enrollment Period (April
2017), https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Data-Highlight-Race-Ethnicity-and-Language-Preference-Marketplace.pdf. States that that do not use the HealthCare.gov
platform, such as California and New York, were not included in this
report.
---------------------------------------------------------------------------
The Department has received many communications from beneficiaries
and advocacy groups complaining about the excessive amount of paperwork
they receive. These individuals and groups have explained that few
people read the notice and taglines and most ignore the last pages of
lengthy health documents. These complaints make us concerned that the
Section 1557 Regulation has resulted in ``cognitive overload,'' such
that individuals experience a diminished ability to process information
when inundated with duplicative information and paperwork.
Additionally, documents that contain a significant number of pages
that recipients do not value will induce annoyance or frustration due
to perceived wasting of time, ignorance of the customers' actual needs
or language abilities, waste of economic resources, or insensitivity to
environmental concerns. These frustrations, though difficult to
quantify are reasonable to expect, given the large volume of health
care communications with notice and taglines that most Americans
receive. It is also reasonable to expect that repeated mailings of
taglines to people who do not want them may negatively impact their
likelihood to read truly significant documents from their insurers or
doctors, and may negatively impact health outcomes in some cases.
The Department seeks comment on whether and how the Final Rule's
notice and taglines requirements impose costs on covered entities and
other downstream entities and individuals.
f. Costs Arising From Removal of Notice and Taglines Requirement
Repealing the notice and taglines requirement may impose costs,
such as decreasing access to, and utilization of, health care for non-
English speakers by reducing their awareness of available translation
services. Even so, such an impact is expected to be negligible. Reports
from covered entities suggest, anecdotally, that utilization of
translation services did not appreciably rise after the Final Rule's
imposition of notice and taglines requirements.\230\ Furthermore, the
Section 1557 requirement added 47 languages to existing language access
requirements, which only increased access to 0.4% of the entire U.S.
population. This is after broadly defining ``limited English
proficiency'' to include those who speak English ``well'' but not
``very well.'' \231\ The Department's Office for Civil Rights also
produced a list of the top 15 languages in each State; however 26 of
the languages on OCR's list are not spoken by even 0.004 percent of the
population. In some States, especially those with sparser populations,
health insurance issuers must provide tagline services in languages
spoken by very few people in the State. For instance, in Wyoming,
issuers must provide translation notices in Gujarati and Navajo in
every significant communication sent to beneficiaries to account for
approximately 40 Gujarati speakers and 39 Navajo speakers; in Montana
issuers must provide notices to account for approximately 80 speakers
of Pennsylvania Dutch; and in Puerto Rico, issuers must provide
taglines notices to account for approximately 22 Korean speakers and 22
French Creole speakers.\232\ In addition, the Section 1557 Regulation
omitted some languages, like Hungarian, spoken by significant numbers
of people in more densely populated States.
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\230\ Source: Aetna (May 1, 2017).
\231\ See HHS OCR, Frequently Asked Questions to Accompany the
Estimates of at Least the Top 15 Languages Spoken by Individuals
with Limited English Proficiency under Section 1557 of the
Affordable Care Act, Question 2 (Sept. 1, 2016), https://www.hhs.gov/civil-rights/for-individuals/section-1557/1557faqs/top15-languages/index.html (using 2013 year estimates). See U.S.
Census Bureau, Language Spoken at Home by Ability to Speak English
for the Population 5 Years and Over, https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_14_5YR_B16001&prodType=table (2016 year
estimates).
\232\ OCR, Resource for Entities Covered by Section 1557 of the
Affordable Care Act, Estimates of at Least the Top 15 Languages
Spoken by Individuals with Limited English Proficiency for the 50
States, the District of Columbia, and the U.S. Territories (Aug.
2016), https://www.hhs.gov/sites/default/files/resources-for-covered-entities-top-15-languages-list.pdf.
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Regulations under Section 504 of the Rehabilitation Act require the
provision of auxiliary aids and services in health programs or
activities that receive Federal financial assistance. 45 CFR 84.52(d).
Because the notice requirement under the Final Rule requires frequent
mailed notification of the availability of auxiliary aids and
[[Page 27883]]
services, repealing the notice of nondiscrimination requirement may
result in additional societal costs, such as decreased utilization of
auxiliary aids and services by individuals with disabilities due to
their reduced awareness of such services. This impact may be limited,
however, because the Section 504 regulations already require recipients
of Federal financial assistance employing fifteen or more persons
provide notice to participants, beneficiaries, applications, employees,
and other interested persons of the availability of such aids and
services. 45 CFR 85.12 and 84.22(f).
Additionally, 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 the process.
g. Cost Savings From Changes to Language Access Plan Provisions
Although the Final Rule did not require covered entities to develop
a language access plan, the Rule stated that the development and
implementation of a language access plan is a factor the Director
``shall'' take into account when evaluating whether an entity is in
compliance with Section 1557. 45 CFR 92.201(b)(2). Therefore, the
Department anticipated that 50% of covered entities would develop and
implement a language access plan following issuance of the Final Rule.
81 FR 31454.
OCR estimated that the burden for developing a language access plan
is approximately three hours of medical and health service manager
staff time in the first year, and an average of one hour of medical and
health service manager staff time per year to update the plan in
subsequent years. The value of an hour of time for people in this
occupation category, after adjusting for overhead and benefits, is
estimated to be $109.36 based on Bureau of Labor Statistics (BLS) data
for 2018.\233\ The Department estimated that approximately 269,141
entities could potentially make changes and develop language access
plans, as part of the requirement to take reasonable steps to provide
meaningful communication with LEP individuals (calculated by reducing
the total number of entities (275,002) by the number of hospitals and
nursing care facilities that were already subject to language access
plan requirements under Medicare Part A (5,861). The Department further
assumed that only 50% of the identified entities would actually make
changes to implement a language access plan. These assumptions imply
that the total cost of developing language access plans will be
approximately $44.1 million (269,141 entities multiplied by 50% of
entities multiplied by 3 hours per entity multiplied by $109.36 per
hour) in the first year and approximately $14.7 million (269,141
entities multiplied by 50% of entities multiplied by 1 hour per entity
multiplied by $109.36 per hour) per year in subsequent years. In making
these calculations, the Department assumes sunk costs cannot be
recovered by this rule, and therefore that initial language access plan
development costs described above cannot be recovered.
---------------------------------------------------------------------------
\233\ BLS, Occupational Employment and Wages (May 2018), https://www.bls.gov/oes/2018/may/oes_nat.htm.
---------------------------------------------------------------------------
By repealing the provision of the Final Rule regarding the Language
Access Plans, the Department estimates an annual savings are $14.7
million.
h. Cost Savings Attributed to Covered Entities' Handling of Certain
Grievances
The proposed rule proposes to repeal the requirement for each
covered entity with 15 or more employees to have a compliance
coordinator and a written grievance procedure to handle complaints
alleging violations of Section 1557. The Department estimates that,
under the proposed rule, covered entities would no longer have to incur
certain labor costs associated with processing grievances related to
sex discrimination complaints as they relate to gender identity and
sex-stereotyping as defined under the Final Rule because such
definitions would be repealed and no longer binding under the proposed
rule. This proposed repeal would not, however, affect the independent
obligations of Section 1557 covered entities to comply with Federal
regulations under Section 504 and Title IX to have written processes in
place to handle grievances alleging certain disability and sex
discrimination claims, respectively.\234\
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\234\ See, e.g., 45 CFR 84.7(a) (HHS regulations implementing
Section 504) (requiring a written process in place for handling
grievances alleging disability discrimination), 86.8(a) (HHS
regulations implementing Title IX) (requiring a written process in
place for handling grievances alleging sex discrimination).
---------------------------------------------------------------------------
For the sake of consistency and convenience, the Department uses
the methodology from the 2016 Final Rule as a foundation for estimating
the projected savings of this proposed rule provision.
The 2016 Final Rule estimated that, in years three through five of
the Final Rule's implementation, covered entities with 15 or more
employees would incur $85.5 million in costs annually to handle Section
1557 grievances. 81 FR 31458. This estimate assumed that covered
entities would experience an average increase in grievances equal to
OCR's projected long-term increase in caseload of about 1%. 81 FR
31376. The 2016 Final Rule monetized this 1% increase in caseload as a
labor cost equivalent to 1% of the annual median wage for a medical and
health service manager (occupation code 11-9111). 81 FR 31376. The
Department continues to assume that OCR's increase in caseload
attributed to the 2016 Final Rule reasonably informs the increase in
grievance processing that covered entities experience.
Based on OCR's tracking of Section 1557 complaints received from
promulgation of the Final Rule (May 18, 2016) until present, OCR
predicts that its long-term caseload would have increased 5% rather
than 1% as originally predicted. Further, OCR believes roughly 60% of
this increase (which equals 3% of the overall increase) would have been
attributable to discrimination claims based on the Final Rule's
definition of sex discrimination with respect to gender identity and
sex stereotyping. The Department uses the phrase ``would have'' with
regard to OCR's caseload because, as described above, the Department
has been enjoined by a Federal court from enforcing claims based on the
Final Rule's novel definition of sex discrimination.
The Final Rule asserted that private parties have the right to
challenge a violation of Section 1557 or the Final Rule in Federal
court, independent of OCR enforcement or involvement. 45 CFR 92.302(d).
In the preamble to the Final Rule, the Department estimated that the
ability for private parties to sue under the Final Rule would result in
covered entities bearing increased compliance costs. 81 FR 31395 (``the
presence of a coordinator and grievance procedure enhances the covered
entity's accountability and helps bring concerns to prompt resolution,
oftentimes prior to an individual bringing a private right of
action.''). The injunction does not apply to suits filed by private
parties.
Although the Supreme Court has recognized a private right of action
for some civil rights statutes enforced by the Department, with the
proposed rule change, the Department would no longer assert that a
private right of action exists for parties to sue covered entities for
any and all alleged violations of the proposed rule. The Department
would no longer take a
[[Page 27884]]
position on that issue in its regulations, leaving the matter as
primarily one for the courts to decide. Additionally, by virtue of
rescinding the definitions from the regulatory text, the proposed rule
would remove the expansive inclusion of gender identity and sex
stereotyping in the definition of sex discrimination as substantive
grounds for a private right of action alleging such violations by
covered entities. As a result, a certain number of covered entities
that are currently incurring grievance-related costs related to these
claims may no longer incur such costs under the proposed rule.
For reasons set forth above, the Department estimates that covered
entities have experienced a 3% increase in grievance claims over the
long term concerning gender identity and sex stereotyping claims as set
forth under the Final Rule and that, under the proposed rule, they
would no longer have to process such claims under the grievance
procedures required under the Final Rule. However, due to voluntary
policies or more stringent State requirements, the Department expects
that 50% of covered entities would likely continue to accept and handle
grievances alleging discrimination based on gender identity and sex
stereotyping as set forth under the Final Rule, notwithstanding that
this proposed rule would eliminate those provisions. Consequently, the
Department estimates that only approximately half of the 3% increase in
caseload, or about 1.5%, will be realized as annual savings by covered
entities. The annual savings in labor attributed to a 1.5% decrease in
grievance caseload is $123.4 million. This value represents 1.5% of the
annual median wage of a medical and health service manager ($199,472
fully loaded) multiplied by the 41,250 covered entities with 15 or more
employees.
i. Additional Costs for Training and Familiarization Under Proposed
Rule
To comply with the proposed rule, the Department anticipates that
some covered entities may incur costs to re-train employees in order
realize potential longer term costs savings from the deregulatory
aspects of this proposed rule change, for example, provisions
eliminating the need for certain grievance procedures described in the
preceding section. The Department assumes that employers are most
likely to train employees who interact with the public, and will
therefore likely train between 40% and 60% of their employees, as the
percentage of employees that interact with patients and the public
varies by covered entity. For purposes of the analysis, the Department
assumes that 50% of the covered entity's staff will receive one-time
training on the requirements of the regulation. It uses the 50%
estimate as a proxy, given the lack of certain information as described
below. For the purposes of the analysis, the Department does not
distinguish between employees whom covered entities will train and
those who obtain training independently of a covered entity.
(1) Number of Covered Entities That May Train Workers
The Final Rule estimated that 275,002 covered entities would train
their employees on the Rule's requirements in general (including
training regarding language access provisions), and used that 275,002
figure as the basis for calculating costs to covered entities arising
specifically out of the Rule's prohibition on discrimination on the
basis of sex. See 81 FR at 31450. HHS assumes, for purposes of this
analysis, that the Final Rule's estimation was an accurate and
reasonable basis for calculating costs arising out of the Final Rule's
prohibition of sex discrimination. However, HHS seeks comment on the
accuracy of these assumptions and calculations.
Table 3--Number of Health Care Entity Firms Covered by Rule
------------------------------------------------------------------------
Number of
NAIC Entity type firms
------------------------------------------------------------------------
62142.......................... Outpatient mental 4,987
health and substance
abuse centers.
621491......................... HMO medical centers.... 104
621492......................... Kidney dialysis centers 492
621493......................... Freestanding ambulatory 4,121
surgical and emergency
centers.
621498......................... All other outpatient 5,399
care centers.
6215........................... Medical and diagnostic 7,958
laboratories.
6216........................... Home health care 21,668
services.
6219........................... All other ambulatory 6,956
health care services.
62321.......................... Residential 6,225
intellectual and
developmental
disability facilities.
6221........................... General medical and 2,904
surgical hospitals.
6222........................... Psychiatric and 411
substance abuse
hospitals.
6223........................... Specialty (except 373
psychiatric and
substance abuse)
hospitals.
6231........................... Nursing care facilities 8,623
(skilled nursing
facilities).
44611.......................... Pharmacies and drug 18,852
stores.
6211........................... Offices of physicians.. 185,649
524114......................... Insurance Issuers...... 180
Navigator grantees..... 100
---------------
Total Entities............. ....................... 275,002
------------------------------------------------------------------------
(2) Number of Individuals Who Will Receive Training
The first category of health care staff that may receive training
comprises health diagnosing and treating practitioners. This category
includes physicians, dentists, optometrists, physician assistants,
occupational, physical, speech and other therapists, audiologists,
pharmacists, registered nurses, and nurse practitioners. The BLS
occupational code for this grouping is 29-1000 and the 2018 reported
count for this occupational group is approximately 5.4 million with
average loaded wages of $98.04 per hour.
The second category of health care staff that the Department
assumes will receive training comprises degreed technical staff
(Occupation code 29-2000) and accounts for 3.1 million workers with
average loaded wages of $46.52 per hour. Technicians work in almost
every area of health care: X-ray to physical, speech, psychiatric,
[[Page 27885]]
dietetic, laboratory, nursing, and records technicians, to name but a
few areas.
The third category of health care staff that the Department assumes
will receive training comprises non-degreed medical assistants
(Occupation code 31-0000), and includes psychiatric and home health
aides, orderlies, dental assistants, and phlebotomists. Health care
support staffs (technical assistants) operate in the same medical
disciplines as technicians, but often lack professional degrees or
certificates. The Department refers to this workforce as non-degreed
compared to medical technicians who generally have degrees or
certificates. There are approximately 4.1 million individuals employed
in these occupations with average loaded wages of $31.14 per hour.
The fourth category of health care staff that the Department
assumes will receive training is health care managers (approximately
0.4 million based on BLS data for occupation code 11-9111) with average
loaded wages of $109.36 per hour. Because the Department assesses costs
of familiarization with the regulation for one manager at each entity,
it assumes that those managers will have already become familiar with
the regulation and will not need additional training.
The fifth category of health care staff that the Department assumes
will receive training is office and administrative assistants--Office
and Administrative Support Occupation (Occupation code 43-0000). These
workers are often the first staff patients encounter in a health
facility and, because of this, covered entities might find it important
that staff, such as receptionists and assistants, receive training on
the regulatory requirements. Approximately 2.8 million individuals were
employed in these occupations in health facilities in 2018 with average
loaded wages of $36.50 per hour. The Department assumes that outreach
workers are included in the five categories listed above, especially in
the manager category.
(3) Total Cost of Training
The Final Rule estimated that covered entities would incur $420.7
million in undiscounted costs to train employees on the requirements of
the Rule, distributed roughly evenly over the first two years after the
Final Rule's effective date. 81 FR at 31458. This conclusion presumed
covered entities were already periodically training employees on their
obligations under Section 1557, but that the Final Rule's new sex
discrimination requirements would induce covered entities to engage in
additional ``comprehensive training.'' 81 FR 31447.
For the purposes of this regulatory impact analysis, the Department
assumes covered entities would face similar costs to retrain the
workforce on the proposed rule's requirements.\235\ However, because
some covered entities will avoid incurring training expenses when they
are not required to (and they will not be under the proposed rule), and
because several States with large populations already prohibit gender
identity discrimination in health care, the Department further assumes
that only 50% of covered entities would modify their policies and
procedures to reflect the changes in the proposed rule. The Department
further assumes that the same percentage, 50%, of covered entities, or
137,501, would train their employees to reflect the changes in the
proposed rule. As in the Final Rule, the Department assumes that
approximately half of the employees at these covered entities will
engage in an average of an additional hour of training, and that this
will occur in the first year of implementing this rule. These
assumptions imply total training costs of $235.9 million. The Final
Rule's calculations of training costs did not anticipate any ongoing
training costs after year one--either in the form of annual refresher
training for returning employees or training for new employees. The
Department now believes that covered entities likely incur such costs,
but assumes that equal costs would also be incurred under the proposed
rule. Therefore, HHS has excluded ongoing training costs from the
calculation of the baseline and from the calculation of the projected
costs of the proposed rule, because such training has a net zero effect
on projected costs. HHS solicits comment on the foregoing assumptions
and calculations of the costs of training under the Final Rule and the
proposed rule.
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\235\ Training costs in the Final Rule relied upon 2014 wages.
See, e.g., 81 FR 31451 (estimating the median hourly wage for
occupation code 29-1000 at $36.26, unloaded, at https://
fxsp0;www.bls.gov/oes/2014/may/oes_nat.htm#29-0000https://www.bls.gov/oes/tables.htm (OES Data: May 2014). https://www.bls.gov/oes/2014/may/oes_nat.htm#29-0000https://www.bls.gov/oes/2014/may/oes_nat.htm#29-0000).
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j. Additional Costs for Revising Policies and Procedures
As discussed above, the Department anticipates that 50% of covered
entities, or approximately 137,501 entities, would choose to revise
their policies or procedures to reflect this proposed rule's
clarification of the application of Section 1557 (if finalized as
proposed), while other covered entities may retain their policies to
ensure compliance with State or local laws. The Department assumes that
it would take, on average, three to five hours for a provider to modify
policies and procedures concerning the Section 1557 proposed rule. The
Department selects four hours, or the midpoint of this range, for the
analysis. HHS further assumes that an average of three of the hours
would be spent by a mid-level manager equivalent to a front-line
supervisor (Occupation code 43-1011), at a cost of $57.06 per hour
\236\ after adjusting for overhead and benefits, and an average of one
hour would be spent by executive staff equivalent to a general and
operations manager (Occupation code 11-1021), at a cost of $119.12 per
hour \237\ after adjusting for overhead and benefits. HHS solicits
comment on the accuracy of these assumptions. The total cost for the
estimated 137,501 covered entities to make their policies and
procedures consistent with the proposed rule's clarification of
discrimination on the basis of sex is estimated to be approximately
$39.9 million following implementation of this rule.
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\236\ BLS, Occupational Employment and Wages, May 2018, https://www.bls.gov/oes/2018/may/oes_nat.htm.
\237\ Id.
---------------------------------------------------------------------------
The above estimates of time and number of entities that would
choose to revise their policies under the regulation are approximate
estimates based on general BLS data. Due to the wide range of types and
sizes of covered entities, from complex multi-divisional hospitals to
small neighborhood clinics and physician offices, the above estimates
of time and number of entities that would choose to revise their
policies under the regulation is difficult to calculate.
k. Other Costs Due to Reversion to Previous Practices
The Final Rule may have prompted covered health care providers to
institute operational changes beyond their nondiscrimination policies
and procedures. HHS solicits comment on providers' experience with the
efficiency or cost-effectiveness of any such operational changes made
in response to the Final Rule. To the extent that such changes required
more than a de minimis cost to implement, providers that choose to
revert to previous practices may incur more than a de minimis cost in
making that reversion. However, as such changes would likely be
voluntary, HHS assumes that providers would make such changes because
they determined them to be cost-effective. HHS solicits comment on the
accuracy of this assumption.
[[Page 27886]]
l. Other Benefits or Costs
The Final Rule's regulatory impact analysis did not include an
economic cost-benefit analysis of the impact of the regulation on
health insurance benefit design. The Department lacks sufficient data
on how much burden the Final Rule has placed on the development and
operation of insurance benefits policies, and, thus, is unable to fully
assess the benefit of removing this requirement. The Final Rule was
intended to impact benefit design by applying Section 1557's
nondiscrimination requirements to denial, cancellation, limitation,
refusal to issue, refusal to renew, or categorical exclusion of certain
benefits related to gender identity. A Federal court, however, enjoined
application of the Final Rule in this manner on a nationwide basis
immediately before the start of the first plan year after the Final
Rule came into effect, thus, OCR has not enforced the Final Rule's
benefit design provisions as they relate to coverage of gender
identity-related treatments.
The Department does not know what effect the Final Rule, in
conjunction with the court injunction, has had on benefit design with
respect to coverage of gender identity-related treatments. It,
therefore, does not have enough information to estimate effects from
the proposal to repeal of the Final Rule's benefit design requirements.
The Department believes, however, that because a Federal court enjoined
enforcement of the Section 1557 Regulation before the start of the
first plan year in which the current rule would have applied, that
beneficiaries of the expanded gender identity provisions could not have
developed a reliance interest on the enjoined parts of the rule. The
Department seeks comments on the effective date of repeal of the gender
identity benefit design provisions.
Additionally, aside from benefit design questions, the Department
seeks comment and documentation of cases where, despite the preliminary
injunction barring OCR from enforcing the provisions, persons would not
have received treatments or procedures related to gender identity or
termination of pregnancy, but for the Final Regulation's gender
identity and termination of pregnancy provisions.
The Department does not estimate any cost savings related to
decreased OCR enforcement of gender identity related claims under the
proposed rule because the injunction has generally prevented OCR
enforcement of such claims to date and the proposed rule would thus
merely reflect the status quo and not result in additional cost savings
related to OCR enforcement expenditures.
Continued enforcement of Section 1557 includes vindication of legal
rights, the benefits of which are difficult to quantify. The proposed
rule would continue to prohibit covered entities from discriminating
against patients and beneficiaries on the basis of their race, color,
national origin, disability, age, or sex. OCR will continue to
vigorously enforce civil rights in order to help guarantee more access
to health care and concomitant improved health outcomes--but these
benefits are difficult to estimate given that many of the prohibitions
encompassed by the proposed rule, as with the Final Rule, have been in
place at the Federal level for many years or have been otherwise
required by State or local law. We welcome comments on these issues.
7. Impact on State, Local, and Tribal Entities Under Executive Orders
12866, 13132, and 13175
a. State and Local Governments
Executive Order 13132 establishes certain requirements that an
agency must meet when it issues a proposed rule (and subsequent Final
Rule) that imposes substantial direct requirement costs on State and
local governments, preempts State law, or otherwise has federalism
implications. Executive Order 13132, 64 FR 43255 (Aug. 4, 1999). The
Department does not believe that this rulemaking would (1) impose
substantial direct requirements costs on State or local governments;
(2) preempt State law; or (3) otherwise have federalism implications.
Section 1557 itself provides that it shall not be construed ``to
supersede State laws that provide additional protections against
discrimination on any basis described in subsection (a) [of Section
1557].'' 42 U.S.C. 18116(b).
The proposed rule maintains the full force of Federal civil rights
laws' protections against discrimination, but does not attempt to
impose a ceiling on how those protections may be observed by States.
State and local jurisdictions would continue to have the flexibility to
impose additional civil rights protections.
The Department believes that there would be reduced costs to State
and local entities, by repealing wasteful Federal mandates and giving
States more flexibility to address the needs of LEP individuals or
other regional-specific issues.
The Department believes that the proposed change to its Title IX
regulations would not have a substantial direct effect on the States,
on the relationship between the national government and the States, on
the distribution of power and responsibilities among the various levels
of government, or on tribal self-government or sovereignty. The
proposed rule would not subject Title IX funding recipients to new
obligations, but rather would relieve potential burden on the States or
tribes that could have resulted from the prior interpretation of Title
IX by HHS. The proposed rule would allow States and tribes to adopt or
continue to provide nondiscrimination protections on the basis of
sexual orientation and gender identity in State, local, and tribal law.
Therefore, the Department has determined that the proposed rule would
not have sufficient federalism implications to warrant the preparation
of a federalism summary impact statement under Executive Order 13132,
and that the rule would not implicate the requirements of Executive
Orders 12866 and 13175 with respect to tribes.
b. Tribal Governments
Executive Order 12866 directs that significant regulatory actions
avoid undue interference with State, local, or tribal governments, in
the exercise of their governmental functions. Executive Order 12866 at
section 6(a)(3)(B).\238\ Executive Order 13175 further directs that
Agencies respect Indian tribal self-government and sovereignty, honor
tribal treaty and other rights, and strive to meet the responsibilities
that arise from the unique legal relationship between the Federal
Government and Indian tribal governments. Executive Order 13175 at
section 2(a). The Department does not believe that the proposed rule
would implicate the requirements of Executive Orders 12866 and 13175
with respect to tribal sovereignty, and solicits comments from tribal
representatives and tribal members on this conclusion and all other
provisions of this proposed rule as they relate to tribes.
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\238\ As stated in the preceding section, the proposed rule does
not have federalism implications.
---------------------------------------------------------------------------
8. Avoidance of Inconsistent, Incompatible, or Duplicative Regulations
Executive Order 12866 requires the Department to avoid issuing
regulations that are inconsistent, incompatible, or duplicative with
other regulations that it has issued or that have been issued by other
Federal agencies. Executive Order 12866 at section 1(b)(10). Section
1557 itself requires avoidance of duplication by providing that the
enforcement
[[Page 27887]]
mechanism under specifically identified civil rights laws ``shall apply
for purposes of violations'' of Section 1557. 42 U.S.C. 18116(a).\239\
The preamble to the Final Rule repeatedly stated that, with the
exception of issues concerning notices, sex discrimination, and
language access plans, it was merely applying civil rights protections
that were already applicable and familiar to covered entities. See 81
FR 31446. (``It is important to recognize that this final rule, except
in the area of sex discrimination, applies pre-existing requirements in
Federal civil rights laws to various entities, the great majority of
which have been covered by these requirements for years.''); 81 FR
31464 (``For the most part, because this regulation is consistent with
existing standards applicable to the covered entities, the new burdens
created by its issuance are minimal.'').
---------------------------------------------------------------------------
\239\ For the applicable enforcement mechanisms, see 45 CFR
parts 80 and 81 (Title VI), 85 (Section 504), 86 (Title IX), 90 and
91 (Age Act).
---------------------------------------------------------------------------
With regard to the current Section 1557 Regulation's notice and
taglines requirement, covered entities are already subject to dozens of
regulations concerning multi-language taglines or notices concerning an
individual's right to have documents translated. For example, CMS
imposes tagline requirements on health insurance marketplaces,
qualified health plan issuers, group health plans and health insurance
issuers, navigators, non-navigator assistance personnel, Medicaid,
Medicaid managed care, Children's Health Insurance Program, Medicare
Advantage, and Medicare Part D.\240\ Furthermore, a Department of
Treasury regulation imposed tagline requirements for hospital
organizations to qualify for tax-exempt status.\241\ Additionally, in
2003, the Department issued guidance under Title VI of the Civil Rights
Act of 1964, setting forth a flexible four-factor framework to assess
the necessity and reasonableness for providing written translation for
LEP individuals.\242\ Finally, the PPACA itself provides that each
summary of benefits and coverage provided by issuers--perhaps the
single most important health insurance-related document a person
receives--must be ``presented in a culturally and linguistically
appropriate manner.'' 42 U.S.C. 300gg-15(b)(2).
---------------------------------------------------------------------------
\240\ 45 CFR 147.136(e)(2)(iii) and (e)(3) and 147.200(a)(5)
(requiring group health plans and QHP issuers to post taglines in
languages in which 10% of individuals with LEP county-wide are
exclusively literate on internal claims and appeals notices, and
requiring QHP issuers to post on its Summary of Benefits and
Coverage), 155.215(c)(4) (requiring Navigators and non-Navigator
personnel in States with Marketplaces operated by HHS to ``[p]rovide
oral and written notice to consumers with LEP, in their preferred
language, informing them of their right to receive language
assistance services and how to obtain them''); 42 CFR 435.905(b)(3)
(Medicaid regulations requiring individuals to be ``informed of the
availability of language services . . . and how to access . . .
[them] through providing taglines in non-English languages
indicating the availability of language services''); 438.10(c)(5)(i)
through (ii) (Medicaid managed care regulations requiring taglines
until July 1, 2017); 438.10(d)(2) through (3), (d)(5)(i),
(d)(5)(iii) and (d)(5)(j) (Medicaid managed care regulations
requiring taglines on ``all written materials for potential
enrollees'' in the prevalent non-English languages in the State and
requiring notification that ``oral interpretation is available for
any language and written translation is available in prevalent
languages'' during the rating period for contracts with managed care
entities beginning on or after July 1, 2017), 457.340(a) (applying
certain Medicaid requirements to the Children's Health Insurance
Program, including Sec. 435.905(b)(3), which requires individuals
to be ``informed of the availability of language services . . . and
how to access . . . [them] through providing taglines in non-English
languages indicating the availability of language services''),
457.1207 (applying certain Medicaid managed care requirements to
Children's Health Insurance Program managed care, including Sec.
438.10(c)(5)(i)-(ii) until the State fiscal year beginning on or
after July, 1, 2018), Sec. 438.10(d)(2)-(3), (d)(5)(i), (iii), (j)
(applying certain Medicaid managed care requirements to Children's
Health Insurance Program managed care, in the State fiscal year
beginning on or after July, 1, 2018); CMS, 2017 Medicare Marketing
Guidelines, Sec. 30.5.1, Sec. 100.2.2, Sec. 8, Sec. 80-8 (Jun.
10, 2016), https://www.cms.gov/Medicare/Health-Plans/ManagedCareMarketing/Downloads/2017MedicareMarketingGuidelines2.pdf
(providing a CMS Multi-Language Insert'' for certain Medicare
Advantage Plan's and Medicare Part D Plan Sponsors' marketing
materials meeting the percentage translation threshold in Sec. Sec.
422.2264(e) and 423.2264(e) of Title 42 of the CFR). As discussed in
the RIA section of this NPRM, we presume 45 CFR
155.205(c)(2)(iii)(A) (requiring Marketplaces and QHP issuers to
post taglines on their websites and documents ``critical for
obtaining health insurance coverage or access to health care
services through a QHP'') and other provisions that depend or refer
to 45 CFR part 92 for their tagline requirements would no longer
apply if this proposed rule is finalized.
\241\ See 79 FR 78954 (Dec. 31, 2014) (finalizing rule requiring
the plain language summary of the financial assistance policy for
hospital organizations to qualify as tax exempt, to indicate, if
applicable, whether the summary, the financial assistance policy,
and the application for such assistance are available in other
languages).
\242\ Guidance to Federal Financial Assistance Recipients
Regarding Title VI Prohibition Against National Origin
Discrimination Affecting Limited English Proficient Persons, 68 FR
47315 (Aug. 8, 2003) (HHS LEP Guidance).
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Substantially replacing many provisions of the Final Rule as
proposed, including removing the notice and taglines requirements,
would eliminate significant redundancies identified above, while
maintaining vigorous enforcement of existing Federal civil rights
statutes.
B. Executive Order 13771 on Reducing and Controlling Regulatory Costs
This proposed rule is expected to be an E.O. 13771 deregulatory
action. The Department estimates that this proposed rule would generate
$532 million in net annualized savings at a 7% discount rate
(discounted relative to year 2016, over a perpetual time horizon, in
2016 dollars).
Furthermore, Executive Order 13765 states that ``the Secretary of
Health and Human Services (Secretary) and the heads of all other
executive departments and agencies (agencies) with authorities and
responsibilities under the [PPACA] shall exercise all authority and
discretion available to waive, defer, grant exemptions from, or delay
the implementation of any provision or requirement of the [PPACA] that
would impose a fiscal burden on any State or a cost, fee, tax, penalty,
or regulatory burden on individuals, families, healthcare providers,
health insurers, patients, recipients of healthcare services, [or]
purchasers of health insurance.'' Executive Order 13765, 82 FR 8351,
8351 (Jan. 24, 2017). In implementing Section 1557 of the PPACA, the
Section 1557 Regulation imposed significant regulatory burdens on
covered entities, including States, healthcare providers, and health
insurers, without corresponding benefits for patients or beneficiaries.
By proposing to substantially replace the Final Rule with a regulation
that requires compliance with pre-existing civil rights laws, the
Department is acting in accordance with Executive Order 13765 in
exercising its authority and discretion to address the fiscal burdens
on States, and the regulatory burdens imposed on individuals, families,
healthcare providers, health insurers, patients, and recipients of
healthcare service. The proposed rule would particularly reduce the
economic burden imposed on health care providers and insurers required
to provide taglines under the Final Rule. Decreasing the burden on
these providers and insurers will allow them to pass along some of the
cost savings to individuals, families, patients, and beneficiaries of
insurance to whom they provide services or coverage. Additionally,
eliminating the taglines requirement will alleviate burdens on patients
and insurance beneficiaries that neither need nor want to receive
repeated tagline mailings.
C. Congressional Review Act
The Congressional Review Act (CRA) defines a ``major rule'' as
``any rule that the Administrator of the Office of Information and
Regulatory Affairs (OIRA) of the Office of Management and Budget finds
has resulted in or is likely to result in--(A) an annual effect on the
economy of $100,000,000 or more; (B) a major increase in costs or
prices for
[[Page 27888]]
consumers, individual industries, Federal, State, or local government
agencies, or geographic regions; or (C) significant adverse effects on
competition, employment, investment, productivity, innovation, or on
the ability of United States-based enterprises to compete with foreign-
based enterprises in domestic and export markets.'' 5 U.S.C. 804(2).
Based on the analysis of this proposed rule under Executive Order
12866, this proposed rule, if finalized as proposed, is expected to be
a major rule for purposes of the Congressional Review Act because it
proposes cost savings of over $100 million. The Department will comply
with the CRA's requirements to inform Congress if applicable.
D. Unfunded Mandates Reform Act
The proposed rule is not subject to the Unfunded Mandates Reform
Act because it falls under an exception for regulations that establish
or enforce any statutory rights that prohibit discrimination on the
basis of race, color, religion, sex, national origin, age, handicap, or
disability. 2 U.S.C. 1503(2).
E. Regulatory Flexibility Act and Executive Order 13272 on Proper
Consideration of Small Entities in Agency Rulemaking
The Regulatory Flexibility Act (RFA) requires agencies to analyze
regulatory options that would minimize any significant impact of a rule
on small entities. Public Law 96-354, 94 Stat. 1164 (Sept. 19, 1980)
(codified at 5 U.S.C. 601 through 612). The RFA requires an agency to
describe the impact of a proposed rulemaking on small entities by
providing an initial regulatory flexibility analysis, unless the agency
expects that the proposed rule will not have a significant economic
impact on a substantial number of small entities, provides a factual
basis for this determination, and proposes to certify the statement. 5
U.S.C. 603(a), 605(b). If an agency must provide an initial regulatory
flexibility analysis, this analysis must address the consideration of
regulatory options that would minimize the economic impact of the
proposed rule on small entities. 5 U.S.C. 603(c).
For purposes of the RFA, small entities include small businesses,
nonprofit organizations, and small governmental jurisdictions. HHS
considers a rule to have a significant impact on a substantial number
of small entities if it has at least a three percent impact of revenue
on at least five percent of small entities.
Based on its examination, the Department has preliminarily
concluded that this proposed rule does not have a significant economic
impact on a substantial number of small entities. The preamble to the
Final Rule discussed the character of small entities impacted by the
Final Rule in detail. 81 FR 31463-31464. Although the proposed rule
would affect numerous small entities, it does not create new or
expanded requirements, and, for all the reasons stated in the RIA, it
will be reducing economic burdens on such entities overall. The
proposed changes to Title IX would not impose any new substantive
obligations on Federal funding recipients and, in fact, would provide
regulatory clarity and relief for any small entities previously subject
to several of the policies and requirements imposed by the Department.
To the extent the proposed rule imposes economic costs, it is
limited to entities' voluntary choices to revise their policies and
procedures and conduct training, and we believe these costs are well
below those required to have a significant impact on a substantial
number of small entities. In addition, the majority of the costs
associated with this proposed rule are proportional to the size of
entities, meaning that even the smallest of the affected entities are
unlikely to face a substantial impact.
For these reasons, the Secretary certifies that the proposed rule
will not have a significant impact on a substantial number of small
entities.
Executive Order 13272 on Proper Consideration of Small Entities in
Agency Rulemaking reinforces the requirements of the RFA and requires
the Department to notify the Chief Counsel for Advocacy of the Small
Business Administration if the proposed rule may have a significant
economic impact on a substantial number of small entities under the
RFA. Executive Order 13272, 67 FR 53461 (Aug. 16, 2002). Because the
economic impact of the proposed rule is not significant under the RFA,
the Department is not subject to Executive Order 13272's notification
requirement.
F. Executive Order 12250 on Leadership and Coordination of
Nondiscrimination Laws
Pursuant to Executive Order 12250, the Attorney General has the
responsibility to ``coordinate the implementation and enforcement by
Executive agencies of . . . Title IX of the Education Amendments of
1972 (20 U.S.C. 1681 et seq.)'' Executive Order 12250 at sec. 1-2(b),
45 FR 72995 (Nov. 2, 1980). Furthermore, Executive Order 12250 requires
the Attorney General to ``review . . . proposed rules . . . of the
Executive agencies in order to identify those which are inadequate,
unclear or unnecessarily inconsistent.'' Id. at sec. 1-202. The
proposed rule has been reviewed and approved by the Attorney General
pursuant to Executive Order 12250.
G. Paperwork Reduction Act
The Department has determined that the proposed rule does not
impose additional reporting or recordkeeping requirements under the
Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq. If the rule is
finalized as proposed, OCR will update and revise its burden analysis
by removing the burden associated with the posting of a
nondiscrimination notice and taglines, development and implementation
of a language access plan, and designation of a compliance coordinator
and adoption of grievance procedures for covered entities with 15 or
more employees. OCR is seeking Paperwork Reduction Act approval for
this reporting requirement via an update to HHS Form 690 (Consolidated
Civil Rights Assurance Form) \243\ separate from this rulemaking.
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\243\ See HHS OCR, Assurance of Compliance Portal, https://ocrportal.hhs.gov/ocr/aoc/instruction.jsf.
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VII. Effective Date
Because this proposed rule would relieve significant regulatory
burdens, particularly the tagline requirements, the Department proposes
that the effective date be 60 days after publication of the Final Rule.
VIII. Request for Comment
The Department seeks comment on all issues raised by the proposed
regulation. Specifically, in addition to issues on which it has already
requested comments, above, the Department requests comment on:
The financial impact of the proposed rule on the health
care sector, with any detailed supporting information, facts, surveys,
audits, or reports;
Whether, and if so how, the proposed rule addresses
clarity and confusion over compliance requirements and rights of
protected classes;
Whether the Final Rule's grievance procedures have
achieved any significant mitigation of the costs of litigation over the
new requirements created by the Final Rule;
Whether, and if so, how new and developing technologies
can assist covered entities with their compliance obligations and
enhance access to quality health care;
[[Page 27889]]
The costs incurred for design of health benefits, with any
detailed information facts, surveys, audits, or reports;
The costs to provide nondiscrimination notices and
taglines, specifically including the marginal labor, material, postage,
and depreciation costs for printing and mailing additional sides and
sheets of paper (including extra postage), the volume of such notices
or mailings, and the impact of such notices or mailings on the
utilization of language access services with any detailed supporting
information, facts, surveys, audits, or reports;
The prevalence of health care entities that operate and
beneficiaries that reside in more than one State, with any detailed
supporting information, facts, surveys, audits, or reports;
The amount of marketing, enrollment, and benefits
communications delivered or mailed per year, with any detailed
supporting information, facts, surveys, audits, or reports;
Unaddressed discrimination on the basis of race, color,
national, and origin, sex, disability, and age as applied to State and
Federally-facilitated Exchanges, with any detailed supporting
information, facts, surveys, audits, or reports;
Whether covered entities seek guidance on best practices
for compliance with Section 1557, such as for civil rights assurances
signed by recipients of Federal financial assistance, and notices of
civil rights posted in areas such as employee break rooms;
The costs of coming into compliance or remaining in
compliance with a Federal prohibition of discrimination on the basis of
gender identity or sexual orientation under Title IX, and with any
detailed supporting information, facts, surveys, audits, or reports;
Whether the proposed LEP provisions are practical,
effective, fiscally responsible, reasonable, responsive to the
particular circumstances relevant to health care programs or
activities, and capable of being readily implemented;
Whether HHS's Title VI regulations at 45 CFR part 80
should be amended to address the Lau v. Nichols precedent applicable to
LEP individuals under any program or activity receiving Federal
financial assistance from HHS;
Whether HHS's Section 504 regulations at 45 CFR part 85
should be amended to address effective communication, accessibility
standards for buildings of facilities, accessibility of electronic
information technology, and the requirement to make reasonable
modifications for otherwise qualified individuals with disabilities
under any program or activity receiving Federal financial assistance
from HHS; and
Whether the proposed provisions on language assistance
services adequately balance an LEP individual's meaningful access to
effectively participate in the covered health program or activity with
the resources available and costs to the covered entity.
List of Subjects
42 CFR Part 438
Civil rights, Discrimination, Grant programs--health, Individuals
with disabilities, Medicaid, National origin, Nondiscrimination,
Reporting and recordkeeping requirements, Sex discrimination.
42 CFR Part 440
Civil rights, Discrimination, Grant programs--health, Individuals
with disabilities, Medicaid, National origin, Nondiscrimination, Sex
discrimination.
42 CFR Part 460
Age discrimination, Aged, Civil rights, Discrimination, Health
Incorporation by reference, Individuals with disabilities, Medicare,
Medicaid, National origin, Nondiscrimination, Religious discrimination,
Reporting and recordkeeping requirements, Sex discrimination.
45 CFR Part 86
Civil rights, Colleges and universities, Employment, Administrative
practice and procedure, Buildings and facilities, Education of
individuals with disabilities, Education, Educational facilities,
Educational research, Educational study programs, Equal educational
opportunity, Equal employment opportunity, Graduate fellowship program,
Grant programs--education, Individuals with disabilities,
Investigations, Reporting and recordkeeping requirements, Sex
discrimination, State agreement program, Student aid, Women.
45 CFR Part 92
Administrative practice and procedure, Age discrimination, Civil
rights, Discrimination, Elderly, Health care, Health facilities, Health
insurance, Health programs or activities, Individuals with
disabilities, National origin, Nondiscrimination, Reporting and
recordkeeping requirements, Sex discrimination.
45 CFR Part 147
Age discrimination, Civil rights, Discrimination, Health care,
Health insurance, Individuals with disabilities, National origin,
Nondiscrimination, Reporting and recordkeeping requirements, Sex
discrimination, State regulation of health insurance.
45 CFR Part 155
Actuarial value, Administration and calculation of advance payments
of the premium tax credit, Administrative practice and procedure,
Advance payments of premium tax credit, Age discrimination, Civil
rights, Cost-sharing reductions, Discrimination, Health care access,
Health insurance, Individuals with disabilities, National origin,
Nondiscrimination, Plan variations, Reporting and recordkeeping
requirements, Sex discrimination, State and local governments.
45 CFR Part 156
Administrative appeals, Administrative practice and procedure,
Administration and calculation of advance payments of premium tax
credit, Advertising, Advisory Committees, Age discrimination, Brokers,
Civil rights, Conflict of interest, Consumer protection, Cost-sharing
reductions, Discrimination, Grant programs-health, Grants
administration, Health care, Health insurance, Health maintenance
organization (HMO), Health records, Hospitals, American Indian/Alaska
Natives, Individuals with disabilities, Loan programs-health,
Organization and functions (Government agencies), Medicaid, National
origin, Nondiscrimination, Payment and collections reports, Public
assistance programs, Reporting and recordkeeping requirements, Sex
discrimination, State and local governments, Sunshine Act, Technical
assistance, Women, Youth.
For the reasons set forth in the preamble, the Department of Health
and Human Services proposes to amend 42 CFR parts 438, 440, and 460 and
45 CFR parts 86, 92, 147, 155, and 156 as follows:
Title 42--Public Health
PART 438--MANAGED CARE
0
1. The authority citation for part 438 continues to read as follows:
Authority: 42 U.S.C. 1302.
0
2. Amend Sec. 438.3 by revising paragraph (d)(4) to read as follows:
Sec. 438.3 Standard contract requirements.
* * * * *
(d) * * *
[[Page 27890]]
(4) The MCO, PIHP, PAHP, PCCM or PCCM entity will not discriminate
against individuals eligible to enroll on the basis of race, color,
national origin, sex, or disability and will not use any policy or
practice that has the effect of discriminating on the basis of race,
color, or national origin, sex, or disability.
* * * * *
0
3. Amend Sec. 438.206 by revising paragraph (c)(2) to read as follows:
Sec. 438.206 Availability of services.
* * * * *
(c) * * *
(2) Access and cultural considerations. Each MCO, PIHP, and PAHP
participates in the State's efforts to promote the delivery of services
in a culturally competent manner to all enrollees, including those with
limited English proficiency and diverse cultural and ethnic
backgrounds, disabilities, and regardless of sex.
* * * * *
PART 440--SERVICES: GENERAL PROVISIONS
0
4. The authority citation for part 440 continues to read as follows:
Authority: 42 U.S.C. 1302.
0
5. Revise Sec. 440.262 to read as follows:
Sec. 440.262 Access and cultural conditions.
The State must have methods to promote access and delivery of
services in a culturally competent manner to all beneficiaries,
including those with limited English proficiency, diverse cultural and
ethnic backgrounds, disabilities, and regardless of sex.
PART 460--PROGRAMS OF ALL-INCLUSIVE CARE FOR THE ELDERLY (PACE)
0
6. The authority citation for part 460 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395l, 1395eee(f), and 1396u-4(f).
0
7. Amend Sec. 460.98 by revising paragraph (b)(3) to read as follows:
Sec. 460.98 Service delivery.
* * * * *
(b) * * *
(3) The PACE organization may not discriminate against any
participant in the delivery of required PACE services based on race,
ethnicity, national origin, religion, sex, age, mental or physical
disability, or source of payment.
* * * * *
0
8. Amend Sec. 460.112 by revising paragraph (a) to read as follows:
Sec. 460.112 Specific rights to which a participant is entitled.
(a) Respect and nondiscrimination. Each participant has the right
to considerate, respectful care from all PACE employees and contractors
at all times and under all circumstances. Each participant has the
right not to be discriminated against in the delivery of required PACE
services based on race, ethnicity, national origin, religion, sex, age,
mental or physical disability, or source of payment.
* * * * *
Title 45--Public Welfare
PART 86--NONDISCRIMINATION ON THE BASIS OF SEX IN EDUCATION
PROGRAMS OR ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE
0
9. The authority citation for part 86 is revised to read as follows:
Authority: 20 U.S.C. 1681-1688; Pub. L. 100-259, 102 Stat. 28
(Mar. 22, 1988).
Sec. 86.2 [Amended]
0
10. Amend Sec. 86.2:
0
a. In paragraph (a), by adding ``1687, 1688'' after ``1686''.
0
b. In paragraph (n), by removing the words ``United States Commissioner
of Education'' and adding in their place the words ``Secretary of
Education''.
0
11. Add Sec. 86.18 to read as follows:
Sec. 86.18 Amendments to conform to statutory exemptions.
(a) Nothing in this part shall be construed to force or require any
individual or hospital or any other institution, program, or activity
receiving Federal Funds to perform or pay for an abortion.
(b) Nothing in this part shall be construed to require or prohibit
any person, or public or private entity, to provide or pay for any
benefit or service, including the use of facilities, related to an
abortion. Nothing in the preceding sentence shall be construed to
permit a penalty to be imposed on any person or individual because such
person or individual is seeking or has received any benefit or service
related to a legal abortion.
(c) This part shall be construed consistently with, as applicable,
the First Amendment to the Constitution, Title IX's religious
exemptions (20 U.S.C. 1681(a)(3) and 1687(4)), the Religious Freedom
Restoration Act (42 U.S.C. 2000b et seq.), and provisions related to
abortion in the Church Amendments (42 U.S.C. 300a-7), the Coats-Snowe
Amendment (42 U.S.C. 238n), Section 1303 of the Patient Protection and
Affordable Care Act (42 U.S.C. 18023), and appropriation rider
provisions relating to abortion, to the extent they remain in effect or
applicable, such as the Hyde Amendment (e.g., Consolidated
Appropriations Act, 2019, Pub. L. 115-245, Div. B, sec. 506-507), the
Helms Amendment (e.g., Continuing Appropriations Act, 2019, Pub. L.
116-6, Div. F, Titl III), and the Weldon Amendment (e.g., Consolidated
Appropriations Act, 2019, Pub. L. 115-245, Div. B, sec. 507(d)).
0
12. Amend Sec. 86.31 by revising paragraph (b) to read as follows:
Sec. 86.31 Education programs or activities.
* * * * *
(b) Specific prohibitions. Except as provided in this subsection,
in providing any aid, benefit, or service to a student, a recipient
shall not, on the basis of sex:
(1) Treat one person differently from another in determining
whether such person satisfies any requirement or condition for the
provision of such aid, benefit, or service;
(2) Provide different aid, benefits, or services or provide aid,
benefits, or services in a different manner;
(3) Deny any person any such aid, benefit, or service;
(4) Subject any person to separate or different rules of behavior,
sanctions, or other treatment;
(5) Apply any rule concerning the domicile or residence of a
student or applicant, including eligibility for in-State fees and
tuition;
(6) Aid or perpetuate discrimination against any person by
providing significant assistance to any agency, organization, or person
which discriminates on the basis of sex in providing any aid, benefit
or service to students or employees;
(7) Otherwise limit any person in the enjoyment of any right,
privilege, advantage, or opportunity.
* * * * *
0
13. Revise Sec. 86.71 to read as follows:
Sec. 86.71 Enforcement procedures.
For the purposes of implementing this Part, the procedural
provisions applicable to Title VI of the Civil Rights Act of 1964 (42
U.S.C. 2000d) are hereby adopted and incorporated herein by reference.
These procedures may be found at 45 CFR 80.6 through 80.11 and 45 CFR
part 81.
0
14. Revise part 92 to read as follows:
[[Page 27891]]
PART 92--NONDISCRIMINATION ON THE BASIS OF RACE, COLOR, NATIONAL
ORIGIN, SEX, AGE, OR DISABILITY IN HEALTH PROGRAMS OR ACTIVITIES
RECEIVING FEDERAL FINANCIAL ASSISTANCE AND PROGRAMS OR ACTIVITIES
ADMINISTERED BY THE DEPARTMENT OF HEALTH AND HUMAN SERVICES UNDER
TITLE I OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT OR BY
ENTITIES ESTABLISHED UNDER SUCH TITLE
Subpart A--General Provisions
Sec.
92.1 Purpose.
92.2 Nondiscrimination requirements.
92.3 Scope of application.
92.4 Assurances.
92.5 Enforcement mechanisms.
92.6 Relationship to other laws.
Subpart B--Specific Applications to Health Programs or Activities
92.101 Meaningful access for individuals with limited English
proficiency.
92.102 Effective communication for individuals with disabilities.
92.103 Accessibility standards for buildings and facilities.
92.104 Accessibility of information and communication technology.
92.105 Requirement to make reasonable modifications.
Authority: 42 U.S.C. 18116; 5 U.S.C. 301, Pub. L. 100-259, 102
Stat. 28 (Mar. 22 1988); 42 U.S.C. 2000d et seq. (Title VI of the
Civil Rights Act of 1964, as amended); 29 U.S.C. 794 (Section 504 of
the Rehabilitation Act of 1973, as amended); 20 U.S.C. 1681 et seq.
(Title IX of the Education Amendments of 1972, as amended); 42
U.S.C. 6101 et seq.; (Age Discrimination Act of 1975, as amended);
Lau v. Nichols, 414 U.S. 563 (1974).
Subpart A--General Provisions
Sec. 92.1 Purpose.
The purpose of this part is to provide for the enforcement of
Section 1557 of the Patient Protection and Affordable Care Act, 42
U.S.C. 18116, prohibiting discrimination under any health program or
activity receiving Federal financial assistance, or under any program
or activity administered by an Executive agency, or by any entity
established, under Title I of such law, on the grounds of race, color,
national origin, sex, age, or disability, except as provided in Title I
of such law (or any amendment thereto). Section 1557 requires the
application of the enforcement mechanisms under Title VI of the Civil
Rights Act of 1964 (42 U.S.C. 2000d et seq.), Title IX of the Education
Amendments of 1972 (20 U.S.C. 1681 et seq.), the Age Discrimination Act
of 1975 (42 U.S.C. 6101 et seq.), and Section 504 of the Rehabilitation
Act of 1973 (29 U.S.C. 794) for purposes of violations of Section 1557
and this part.
Sec. 92.2 Nondiscrimination requirements.
(a) Except as provided in Title I of the Patient Protection and
Affordable Care Act (or any amendment thereto), an individual shall
not, on any of the grounds set forth in paragraph (b) of this section,
be excluded from participation in, be denied the benefits of, or be
subjected to discrimination under any health program or activity, any
part of which is receiving Federal financial assistance (including
credits, subsidies, or contracts of insurance) provided by the U.S.
Department of Health and Human Services; or under any program or
activity administered by the Department under such Title; or under any
program or activity administered by any entity established under such
Title.
(b) The grounds are the grounds prohibited under the following
statutes:
(1) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et
seq.) (race, color, national origin);
(2) Title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et
seq.) (sex);
(3) The Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.)
(age); or
(4) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794)
(disability).
Sec. 92.3 Scope of application.
(a) Except as otherwise provided in this part, this part applies to
(1) Any health program or activity, any part of which is receiving
Federal financial assistance (including credits, subsidies, or
contracts of insurance) provided by the Department;
(2) Any program or activity administered by the Department under
Title I of the Patient Protection and Affordable Care Act; or
(3) Any program or activity administered by any entity established
under such Title.
(b) As used in this part, ``health program or activity''
encompasses all of the operations of entities principally engaged in
the business of providing health care that receive Federal financial
assistance as described in paragraph (a)(1) of this section. For any
entity not principally engaged in the business of providing health
care, the requirements applicable to a ``health program or activity''
under this part shall apply to such entity's operations only to the
extent any such operation receives Federal financial assistance as
described in paragraph (a)(1) of this section.
(c) For purposes of this part, an entity principally or otherwise
engaged in the business of providing health insurance shall not, by
virtue of such provision, be considered to be principally engaged in
the business of providing health care.
Sec. 92.4 Assurances.
(a) Assurances. An entity applying for Federal financial assistance
to which this part applies shall, as a condition of any application for
Federal financial assistance, submit an assurance, on a form specified
by the Director of the Department's Office for Civil Rights, that the
entity's health programs or activities will be operated in compliance
with Section 1557 and this part. A health insurance issuer seeking
certification to participate in an Exchange or a State seeking approval
to operate a State Exchange to which Section 1557 or this part applies
shall, as a condition of certification or approval, submit an
assurance, on a form specified by the Director of the Department's
Office for Civil Rights, that the health program or activity will be
operated in compliance with Section 1557 and this part. An applicant or
entity may incorporate this assurance by reference in subsequent
applications to the Department for Federal financial assistance or
requests for certification to participate in an Exchange or approval to
operate a State Exchange.
(b) Duration of obligation. The duration of the assurances required
by this subpart is the same as the duration of the assurances required
in the Department's regulations implementing Section 504 at 45 CFR
84.5(b).
(c) Covenants. When Federal financial assistance is provided in the
form of real property or interest, the same conditions apply as those
contained in the Department's regulations implementing Section 504 at
45 CFR 84.5(c), except that the nondiscrimination obligation applies to
discrimination on all bases covered under Section 1557 and this part.
Sec. 92.5 Enforcement mechanisms.
(a) The enforcement mechanisms provided for, and available under,
Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.),
Title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et seq.),
the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), or Section
504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), including under
the Department's regulations implementing those statutes, shall apply
for purposes of violations of Sec. 92.2 of this part.
(b) The Director of the Office for Civil Rights has been delegated
the authority to enforce 42 U.S.C. 18116 and this part, which includes
the authority to handle
[[Page 27892]]
complaints, initiate and conduct compliance reviews, conduct
investigations, supervise and coordinate compliance within the
Department, make enforcement referrals to the Department of Justice, in
coordination with the Office of the General Counsel and the relevant
component or components of the Department, and take other appropriate
remedial action as the Director deems necessary, in coordination with
the relevant component or components of the Department, and as allowed
by law to overcome the effects of violations of 42 U.S.C. 18116 or of
this part.
Sec. 92.6 Relationship to other laws.
(a) Nothing in this part shall be construed to invalidate or limit
the rights, remedies, procedures, or legal standards available to
individuals aggrieved under Title VI of the Civil Rights Act of 1964
(42 U.S.C. 2000d et seq.), Title VII of the Civil Rights Act of 1964
(42 U.S.C. 2000e et seq.), Title IX of the Education Amendments of 1972
(20 U.S.C. 1681 et seq.), the Age Discrimination Act of 1975 (42 U.S.C.
6101 et seq.), or Section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794), or to supersede State laws that provide additional
protections against discrimination on any basis described in Sec. 92.2
of this part.
(b) Insofar as the application of any requirement under this part
would violate, depart from, or contradict definitions, exemptions,
affirmative rights, or protections provided by any of the statutes
cited in paragraph (a) of this section or provided by the Architectural
Barriers Act of 1968 (42 U.S.C. 4151 et seq.); the Americans with
Disabilities Act of 1990, as amended by the Americans with Disabilities
Act Amendments Act of 2008 (42 U.S.C. 12181 et seq.), Section 508 of
the Rehabilitation Act of 1973, as amended (29 U.S.C. 794d), the Coats-
Snowe Amendment (42 U.S.C. 238n), the Church Amendments (42 U.S.C.
300a-7), the Religious Freedom Restoration Act (42 U.S.C. 2000bb et
seq.), Section 1553 of the Patient Protection and Affordable Care Act
(42 U.S.C. 18113), Section 1303 of the Patient Protection and
Affordable Care Act (42 U.S.C. 18023), the Weldon Amendment
(Consolidated Appropriations Act, 2019, Pub. L. 115-245, Div. B sec.
209 and sec. 506(d) (Sept. 28, 2018)), or any related, successor, or
similar Federal laws or regulations, such application shall not be
imposed or required.
Subpart B--Specific Applications to Health Programs or Activities
Sec. 92.101 Meaningful access for individuals with limited English
proficiency.
(a) Obligation. Any entity operating or administering a health
program or activity subject to this part shall take reasonable steps to
ensure meaningful access to such programs or activities by limited
English proficient individuals.
(b) Specific applications--(1) Enforcement discretion. In
evaluating whether any entity to which paragraph (a) of this section
applies has complied with paragraph (a) of this section, the Director
of the Department's Office for Civil Rights may assess how such entity
balances the following four factors:
(i) The number or proportion of limited English proficient
individuals eligible to be served or likely to be encountered in the
eligible service population;
(ii) The frequency with which LEP individuals come in contact with
the entity's health program, activity, or service;
(iii) The nature and importance of the entity's health program,
activity, or service; and
(iv) The resources available to the entity and costs.
(2) Language assistance services requirements. Where paragraph (a)
of this section, in light of the entity's individualized assessment of
the four factors set forth in paragraph (b)(1) of this section,
requires the provision of language assistance services, such services
must be provided free of charge, be accurate and timely, and protect
the privacy and independence of the individual with limited English
proficiency. Language assistance services may include:
(i) Oral language assistance, including interpretation in non-
English languages provided in-person or remotely by a qualified
interpreter for an individual with limited English proficiency, and the
use of qualified bilingual or multilingual staff to communicate
directly with individuals with limited English proficiency; and
(ii) Written translation, performed by a qualified translator, of
written content in paper or electronic form into languages other than
English.
(3) Specific requirements for interpreter and translation services.
(i) Where paragraph (a) of this section, in light of the entity's
individualized assessment of the four factors set forth in paragraph
(b)(1) of this section, requires the provision of interpreter services,
they must be provided by an interpreter who:
(A) Adheres to generally accepted interpreter ethics principles,
including client confidentiality;
(B) Has demonstrated proficiency in speaking and understanding at
least spoken English and the spoken language in need of interpretation;
and
(C) Is able to interpret effectively, accurately, and impartially,
both receptively and expressly, to and from such language(s) and
English, using any necessary specialized vocabulary, terminology and
phraseology.
(ii) Where paragraph (a) of this section, in light of the entity's
individualized assessment of the four factors set forth in paragraph
(b)(1) of this section, requires the provision of translation services
for written content (in paper or electronic form), they must be
provided by a translator who:
(A) Adheres to generally accepted translator ethics principles,
including client confidentiality;
(B) Has demonstrated proficiency in writing and understanding at
least written English and the written language in need of translation;
and
(C) Is able to translate effectively, accurately, and impartially
to and from such language(s) and English, using any necessary
specialized vocabulary, terminology and phraseology.
(iii) If remote audio interpreting services are required to comply
with paragraph (a) of this section, in light of the entity's
individualized assessment of the four factors set forth in paragraph
(b)(1) of this section, the entity to which Section 1557 applies (as
defined in Sec. 92.3 of this part) shall provide:
(A) Real-time, audio over a dedicated high-speed, wide-bandwidth
video connection or wireless connection that delivers high-quality
audio without lags or irregular pauses in communication;
(B) A clear, audible transmission of voices; and
(C) Adequate training to users of the technology and other involved
individuals so that they may quickly and efficiently set up and operate
the remote interpreting services.
(4) Restricted use of certain persons to interpret or facilitate
communication. If an entity is required by paragraph (a) of this
section, in light of the entity's individualized assessment of the four
factors set forth in paragraph (b)(1) of this section, to provide
interpretation services, such entity shall not:
(i) Require an individual with limited English proficiency to
provide his or her own interpreter;
(ii) Rely on an adult accompanying an individual with limited
English proficiency to interpret or facilitate communication, except
[[Page 27893]]
(A) In an emergency involving an imminent threat to the safety or
welfare of an individual or the public, where there is no qualified
interpreter for the individual with limited English proficiency
immediately available;
(B) Where the individual with limited English proficiency
specifically requests that the accompanying adult interpret or
facilitate communication, the accompanying adult agrees to provide such
assistance, and reliance on that adult for such assistance is
appropriate under the circumstances;
(iii) Rely on a minor child to interpret or facilitate
communication, except in an emergency involving an imminent threat to
the safety or welfare of an individual or the public, where there is no
qualified interpreter for the individual with limited English
proficiency immediately available; or
(iv) Rely on staff other than qualified bilingual/multilingual
staff to communicate directly with individuals with limited English
proficiency.
(c) Acceptance of language assistance services is not required.
Nothing in this section shall be construed to require an individual
with limited English proficiency to accept language assistance
services.
Sec. 92.102 Effective communication for individuals with
disabilities.
(a) Any entity operating or administering a program or activity
under this part shall take appropriate steps to ensure that
communications with individuals with disabilities are as effective as
communications with others in such programs or activities, in
accordance with the standards found at 28 CFR 35.160 through 35.164.
Where the regulatory provisions referenced in this section use the term
``public entity,'' the term ``entity'' shall apply in its place.
(b) A recipient or State Exchange shall provide appropriate
auxiliary aids and services, including interpreters and information in
alternate formats, to individuals with impaired sensory, manual, or
speaking skills, where necessary to afford such persons an equal
opportunity to benefit from the service in question.
(1) Auxiliary aids and services include:
(i) Interpreters on-site or through video remote interpreting (VRI)
services, as defined in 28 CFR 35.104 and 36.303(f); note takers; real-
time computer-aided transcription services; written materials; exchange
of written notes; telephone handset amplifiers; assistive listening
devices; assistive listening systems; telephones compatible with
hearing aids; closed caption decoders; open and closed captioning,
including real-time captioning; voice, text, and video-based
telecommunication products and systems, text telephones (TTYs),
videophones, and captioned telephones, or equally effective
telecommunications devices; videotext displays; accessible information
and communication technology; or other effective methods of making
aurally delivered information available to individuals who are deaf or
hard of hearing; and
(ii) Readers; taped texts; audio recordings; Braille materials and
displays; screen reader software; magnification software; optical
readers; secondary auditory programs; large print materials; accessible
information and communication technology; or other effective methods of
making visually delivered materials available to individuals who are
blind or have low vision.
(2) When an entity is required to provide an interpreter under
subsection (b), the interpreting service shall be provided to
individuals free of charge and in a timely manner, via a remote
interpreting service or an onsite appearance, by an interpreter who
(i) Adheres to generally accepted interpreter ethics principles,
including client confidentiality; and
(ii) Is able to interpret effectively, accurately, and impartially,
both receptively and expressively, using any necessary specialized
vocabulary, terminology and phraseology.
(3) An interpreter for an individual with a disability for purposes
of this section can include, for example, sign language interpreters,
oral transliterators (individuals who represent or spell in the
characters of another alphabet), and cued language transliterators
(individuals who represent or spell by using a small number of
handshapes).
(c) Disability means, with respect to an individual, a physical or
mental impairment that substantially limits one or more major life
activities of such individual; a record of such an impairment; or being
regarded as having such an impairment, as defined and construed in the
Rehabilitation Act, 29 U.S.C. 705(9)(B), which incorporates the
definition of disability in the Americans with Disabilities Act (ADA),
as amended (42 U.S.C. 12102 et seq.). Where this part cross-references
regulatory provisions that use the term ``handicap,'' ``handicap''
means ``disability'' as defined in this section.
Sec. 92.103 Accessibility standards for buildings and facilities.
(a) Each facility or part of a facility in which health programs or
activities are conducted that is constructed or altered by or on behalf
of, or for the use of, a recipient or State Exchange shall comply with
the 2010 Standards, if the construction or alteration was commenced on
or after July 18, 2016, except that if a facility or part of a facility
in which health programs or activities are conducted that is
constructed or altered by or on behalf of, or for the use of, a
recipient or State Exchange, was not covered by the 2010 Standards
prior to July 18, 2016, such facility or part of a facility shall
comply with the 2010 Standards if the construction was commenced after
January 18, 2018. Departures from particular technical and scoping
requirements by the use of other methods are permitted where
substantially equivalent or greater access to and usability of the
facility is provided. All newly constructed or altered buildings or
facilities subject to this section shall comply with the requirements
for a ``public building or facility'' as defined in section 106.5 of
the 2010 Standards.
(b) Each facility or part of a facility in which health programs or
activities under this part are conducted that is constructed or altered
by or on behalf of, or for the use of, a recipient or State Exchange in
conformance with the 1991 Standards at appendix D to 28 CFR part 36 or
the 2010 Standards shall be deemed to comply with the requirements of
this section and with 45 CFR 84.23(a) and (b) with respect to those
facilities, if the construction or alteration was commenced on or
before July 18, 2016. Each facility or part of a facility in which
health programs or activities are conducted that is constructed or
altered by or on behalf of, or for the use of, a recipient or State
Exchange in conformance with UFAS shall be deemed to comply with the
requirements of this section and with 45 CFR 84.23(a) and (b), if the
construction was commenced before July 18, 2016 and such facility was
not covered by the 1991 Standards or 2010 Standards.
(c) For purposes of this part:
(1) ``1991 Standards'' refers to the 1991 Americans with
Disabilities Act Standards for Accessible Design at appendix D to 28
CFR part 36.
(2) ``2010 Standards'' refers to the 2010 ADA Standards for
Accessible Design, as defined in 28 CFR 35.104.
(3) ``UFAS'' refers to the Uniform Federal Accessibility Standards
as promulgated in 49 FR 31528 (Aug. 7, 1984).
[[Page 27894]]
Sec. 92.104 Accessibility of information and communication
technology.
(a) Entities required to comply with Sec. 92.2, unless otherwise
exempted by this part, shall ensure that their health programs or
activities provided through information and communication technology
are accessible to individuals with disabilities, unless doing so would
result in undue financial and administrative burdens or a fundamental
alteration in the nature of the health programs or activities. When
undue financial and administrative burdens or a fundamental alteration
exist, the covered entity shall provide information in a format other
than an electronic format that would not result in such undue financial
and administrative burdens or a fundamental alteration, but would
ensure, to the maximum extent possible, that individuals with
disabilities receive the benefits or services of the health program or
activity that are provided through information and communication
technology.
(b) A recipient or State Exchange shall ensure that its health
programs or activities provided through websites comply with the
requirements of Title II of the Americans with Disabilities Act (42
U.S.C. 12131 through 12165).
(c) For purposes of this part, ``information and communication
technology'' (ICT) means information technology and other equipment,
systems, technologies, or processes, for which the principal function
is the creation, manipulation, storage, display, receipt, or
transmission of electronic data and information, as well as any
associated content. Examples of ICT include computers and peripheral
equipment; information kiosks and transaction machines;
telecommunications equipment; customer premises equipment;
multifunction office machines; software; applications; websites;
videos; and, electronic documents.
Sec. 92.105 Requirement to make reasonable modifications.
Any entity to which Section 1557 applies (as defined in Sec. 92.3
of this part) shall make reasonable modifications to its policies,
practices, or procedures when such modifications are necessary to avoid
discrimination on the basis of disability, unless the covered entity
can demonstrate that making the modifications would fundamentally alter
the nature of the health program or activity. For the purposes of this
section, the term ``reasonable modifications'' shall be interpreted in
a manner consistent with the term as set forth in the regulation
promulgated under Title II of the Americans with Disabilities Act, at
28 CFR 35.130(b)(7).
PART 147--HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND
INDIVIDUAL HEALTH INSURANCE MARKETS
0
15. The authority citation for part 147 continues to read as follows:
Authority: 42 U.S.C. 18021, 18031, 18041, 18044, 18054, 18061,
18063, 18071, and 18082, 26 U.S.C. 36B, 31 U.S.C. 9701.
0
16. Amend Sec. 147.104 by revising paragraph (e) to read as follows:
Sec. 147.104 Guaranteed availability of coverage.
* * * * *
(e) Marketing. A health insurance issuer and its officials,
employees, agents and representatives must comply with any applicable
State laws and regulations regarding marketing by health insurance
issuers and cannot employ marketing practices or benefit designs that
will have the effect of discouraging the enrollment of individuals with
significant health needs in health insurance coverage or discriminate
based on an individual's race, color, national origin, present or
predicted disability, age, sex, expected length of life, degree of
medical dependency, quality of life, or other health conditions.
* * * * *
PART 155--EXCHANGE ESTABLISHMENT STANDARDS AND OTHER RELATED
STANDARDS UNDER THE AFFORDABLE CARE ACT
Subpart B--General Standards Related to the Establishment of an
Exchange
0
17. The authority citation for Part 155 continues to read as follows:
Authority: 42 U.S.C. 18021-18024, 18031-18033, 18041-18042,
18051, 18054, 18071, and 18081-18083.
0
18. Amend Sec. 155.120 by revising paragraph (c)(1)(ii) to read as
follows:
Sec. 155.120 Non-interference with Federal law and non-discrimination
standards.
* * * * *
(c) * * *
(1) * * *
(ii) Not discriminate based on race, color, national origin,
disability, age, or sex.
* * * * *
0
19. Amend Sec. 155.220 by revising paragraph (j)(2)(i) to read as
follows:
Sec. 155.220 Ability of States to permit agents and brokers to assist
qualified individuals, qualified employers, or qualified employees
enrolling in QHPs.
* * * * *
(j) * * *
(2) * * *
(i) Provide consumers with correct information, without omission of
material fact, regarding the Federally-facilitated Exchanges, QHPs
offered through the Federally-facilitated Exchanges, and insurance
affordability programs, and refrain from marketing or conduct that is
misleading (including by having a direct enrollment website that HHS
determines could mislead a consumer into believing they are visiting
HealthCare.gov), coercive, or discriminates based on race, color,
national origin, disability, age, or sex;
* * * * *
PART 156--HEALTH INSURANCE ISSUER STANDARDS UNDER THE AFFORDABLE
CARE ACT, INCLUDING STANDARDS RELATED TO EXCHANGES
0
20. The authority citation for part 156 continues to read as follows:
Authority: 5 U.S.C. 552; 42 U.S.C. 300jj-11 and 300jj-14.
0
21. Amend Sec. 156.200 by revising paragraph (e) to read as follows:
Sec. 156.200 QHP issuer participation standards.
* * * * *
(e) Non-discrimination. A QHP issuer must not, with respect to its
QHP, discriminate on the basis of race, color, national origin,
disability, age, or sex.
* * * * *
0
22. Amend Sec. 156.1230 by revising paragraph (b)(3) to read as
follows:
Sec. 156.1230 Direct enrollment with the QHP issuer in a manner
considered to be through the Exchange.
* * * * *
(b) * * *
[[Page 27895]]
(3) The QHP issuer must provide consumers with correct information,
without omission of material fact, regarding the Federally-facilitated
Exchanges, QHPs offered through the Federally-facilitated Exchanges,
and insurance affordability programs, and refrain from marketing or
conduct that is misleading (including by having a direct enrollment
website that HHS determines could mislead a consumer into believing
they are visiting HealthCare.gov), coercive, or discriminates based on
race, color, national origin, disability, age, or sex.
* * * * *
Dated: May 23, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
[FR Doc. 2019-11512 Filed 6-13-19; 8:45 am]
BILLING CODE 4153-01-P
