Nondiscrimination in Health and Health Education Programs or Activities, Delegation of Authority

Federal RegisterJun 19, 2020

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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

RIN 0945-AA11

Nondiscrimination in Health and Health Education Programs or Activities, Delegation of Authority

AGENCY:

Centers for Medicare & Medicaid Services (CMS); Office for Civil Rights (OCR), Office of the Secretary, Department of Health and Human Services (HHS).

ACTION:

Final rule.

SUMMARY:

The Department of Health and Human Services (“the Department” or “HHS”) 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 (“ACA”). After considering public comments, in this final rule, the Department revises its Section 1557 regulations, Title IX regulations, and specific regulations of the Centers for Medicare & Medicaid Services (“CMS”) as proposed, with minor and primarily technical corrections. This will 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:

This rule is effective August 18, 2020.

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. Purpose

B. Summary of Major Provisions

(1) Changes to the Section 1557 Regulation

a. Elimination of Overbroad Provisions Related to Sex and Gender Identity

b. Clarification of Scope of Covered Entities

c. Elimination of Unnecessary or Duplicative Language on Civil Rights Enforcement

d. Elimination of Unnecessary Regulatory Burdens

e. Other Clarifications and Minor Modifications

(2) Related and Conforming Amendments to Other Regulations

a. Title IX

b. CMS

C. Summary of the Costs and Benefits of the Major Provisions

II. Background

III. Response to Public Comments on the Proposed Rule

A. General Comments

B. Section 1557 Regulation, Subpart A: General Requirements and Prohibitions

(1) Proposed Repeal of Definitions in § 92.4 of the 2016 Rule

(2) General Changes to 2016 Rule

a. Purpose of Regulation, Revising § 92.1 of the 2016 Rule

b. Effective Date

c. Severability

d. Summary of Regulatory Changes

(3) Scope of Application in Proposed § 92.3; Repeal of § 92.208

a. Generally

b. § 92.3(a): Covered Programs and Activities

c. § 92.3(b): Scope of the Term “Health Program or Activity”

d. § 92.3(c) Health Insurance and Healthcare

e. Summary of Regulatory Changes

(4) Nondiscrimination Requirements in Proposed Revisions to § 92.2, and Repeal of § 92.8(d), 92.101, 92.206, 92.207, 92.209, and Appendix B of the 2016 Rule

a. Discrimination on the Basis of Race, Color, or National Origin

i. Generally

ii. Repeal of Notice and Taglines Provisions at § 92.8(d) and Appendix B of the 2016 Rule

b. Discrimination on the Basis of Disability

c. Discrimination on the Basis of Age

d. Discrimination on the Basis of Sex

i. Generally

ii. Gender Identity, Including Single-Sex Services Under § 92.206 of the 2016 Rule

iii. Termination of Pregnancy

iv. Sexual Orientation

v. Scrutiny for Sex-Based Classifications (Repeal of § 92.101(b)(3)(iv) of the 2016 Rule)

vi. Disparate Impact Under § 92.101(b)(3)(iii) of the 2016 Rule

vii. Insurance Coverage in § 92.207 of the 2016 Rule

e. Discrimination on the Basis of Association, Repeal of § 92.209 of the 2016 Rule

f. Multiple Protected Statuses

g. Examples of Discriminatory Practices (Repeal of § 92.207 of the 2016 Rule)

h. Summary of Regulatory Changes

(5) Assurances in Proposed § 92.4, and Repeal of § 92.5 of the 2016 Rule

(6) Enforcement Mechanisms in Proposed § 92.5, and Repeal of §§ 92.6, 92.7, 92.8, 92.101, 92.301, 92.302, 92.303, and Appendices A and C of the 2016 Rule

a. Enforcement Procedures and Underlying Regulations in § 92.5(a) (Repeal of § 92.302 and § 92.6(a) of the 2016 Rule)

b. Compensatory Damages (Repeal of § 92.301(b) of the 2016 Rule)

c. Implied Private Rights of Action (Repeal of § 92.302(d) of the 2016 Rule)

d. Voluntary Action (Repeal of § 92.302(c) and § 92.6(b) of the 2016 Rule)

e. Access to Records of Compliance (Repeal of § 92.303(c) of the 2016 Rule)

f. Prohibitions on Intimidation and Retaliation (Repeal of § 92.303(d) of the 2016 Rule)

g. Perpetuating Discrimination by Assistance and Utilizing Criteria or Methods of Administration (Repeal of § 92.101(b)(1)(ii), (b)(3)(ii), and (b)(4)(ii) of the 2016 Rule)

h. Notices of Nondiscrimination Rights and Statement of Nondiscrimination Under the 2016 Rule (Repeal of § 92.8 of the 2016 Rule)

i. Summary of Regulatory Changes

(7) Relationship to Other Laws in Proposed § 92.6, and Repeal of § 92.2(b) and 92.3 of the 2016 Rule

a. Conscience Laws

b. Religious Freedom Restoration Act

c. Title IX

d. Other Laws and Cases

e. Summary of Regulatory Changes

C. Section 1557 Regulation, Subpart B: Specific Applications to Health Programs or Activities (Sections 92.201-92.205 of the 2016 Rule)

(1) Meaningful Access for Individuals With Limited English Proficiency (45 CFR 92.101)

(2) Effective communication for Individuals With Disabilities (45 CFR 92.102)

(3) Accessibility Standards for Buildings and Facilities (45 CFR 92.103)

(4) Accessibility of Information and Communication Technology (45 CFR 92.104)

(5) Requirement To Make Reasonable Modifications (45 CFR 92.105)

(6) Summary of Regulatory Changes

D. Title IX Regulations

(1) Nomenclature, Rules of Appearance, Effective Date Modifications to Rules at 45 CFR 86.31 and 86.71

(2) Abortion Neutrality of 20 U.S.C. 1688 in 45 CFR 86.2 and 86.18

(3) Summary of Regulatory Changes

E. Conforming Amendments to CMS Regulations

(1) Generally

(2) Delivery of Medicaid Services (42 CFR 438.3(d)(4), 438.206(c)(2), 440.262))

(3) General Standards for Exchanges, QHPs for Exchanges, and Health Plan Issuers (45 CFR 155.120(c)(ii)),156.200(e))

(4) Guaranteed Coverage (45 CFR 147.104(e))

(5) Enrollment in QHPs Through Exchanges By Agents or Brokers (45 CFR 155.220(j)(2)(i))

(6) Enrollment in QHPs and Exchanges By QHP Issuers (45 CFR 156.1230(b)(2))

(7) Summary of Regulatory Changes

IV. Regulatory Impact Analysis

A. Executive Orders 12866 and Related Executive Orders on Regulatory Review

(1) Consideration of Regulatory Alternatives

(2) Considerations for Cost-Effective Design

(3) Methodology for Cost-Benefit Analysis

(4) Cost-Benefit Analysis

a. Overview

b. Generally Applicable Benefits and Burdens

i. Simplification and Flexibility

ii. Policies and Procedures Concerning Gender Identity

c. Baseline Assumptions

d. Covered Entities

i. 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 ACA

ii. Entities Covered by Title IX

e. Cost Savings From Eliminating Notice and Taglines Requirement

f. Costs 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

i. Number of Covered Entities That May Train Workers

ii. Number of Individuals Who Will Receive Training

iii. Total Costs of Training

j. Additional Costs for Revising Policies and Procedures

k. Other Benefits or Costs

(5) Impact on State, Local, and Tribal Entities under Executive Orders 12866, 13132, and 13175

a. State and Local Governments

b. Tribal Governments

(6) 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

(D) Delegation of Authority

I. Executive Summary

A. Purpose

This regulation finalizes the Department's proposed rule concerning Nondiscrimination in Health and Health Education Programs or Activities issued in the

Federal Register

on June 14, 2019 (84 FR 27846), with minor and primarily technical corrections. It makes changes to the Department's existing regulation

(“2016 Rule”) implementing Section 1557 of the ACA, 42 U.S.C. 18116. It makes a related amendment to the Department's regulations implementing Title IX of the Education Amendments of 1972 (“Title IX”), and it makes conforming amendments to nondiscrimination provisions within various CMS regulations.

81 FR 31375-473 (May 18, 2016) codified at 45 CFR part 92.

Through Section 1557 of the ACA, 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 ACA or by an entity established under such Title. It did so by cross-referencing statutes that specify prohibited grounds of discrimination, namely, 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.

42 U.S.C. 18116.

This final rule returns to the enforcement mechanisms provided for, and available under, those longstanding statutes and the Department's implementing regulations. It eliminates many of the provisions of the 2016 Rule in order to better comply with the mandates of Congress, relieves approximately $2.9 billion in undue regulatory burdens (over five years), furthers substantive compliance, reduces confusion, and clarifies the scope of Section 1557. It empowers the Department to continue its robust enforcement of civil rights laws by making clear that the substantive protections of Title VI of the Civil Rights Act of 1964 (“Title VI”), Title IX, the Age Discrimination Act of 1975 (“Age Act”), and Section 504 of the Rehabilitation Act of 1973 (“Section 504”) remain in full force and effect.

While Section 1557 does not incorporate nondiscrimination provisions by reference to Title VII, it provides that nothing in Title I of the ACA 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).

This final rule is needed because the Department has determined that portions of the 2016 Rule are duplicative or confusing, impose substantial unanticipated burdens, or impose burdens that outweigh their anticipated benefits. Additionally, two Federal district courts have determined that the Department exceeded its authority in promulgating parts of the regulation, and one has vacated and remanded those parts of the 2016 Rule. By substantially repealing much of the 2016 Rule, including removing the vacated provisions from the Code of Federal Regulations, the Department reverts to longstanding statutory interpretations that conform to the plain meaning of the underlying civil rights statutes and the United States Government's official position concerning those statutes.

The Department initially estimated the costs from the 2016 Rule at over $942 million across the first five years. 81 FR 31458-59. This figure, however, significantly underestimated actual costs, according to the Department's current estimates. As estimated now, the costs derived merely from the 2016 Rule's requirement to provide notices and taglines with all significant communications, after accounting for electronic delivery, amount to an average annual burden of $585 million per year, for a five-year burden of $2.9 billion. Based on the Department's re-examination of the burden on regulated entities, and after reviewing public comments, the Department has 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.

B. Summary of Major Provisions

(1) Changes to the Section 1557 Regulation

a. Elimination of Overbroad Provisions Related to Sex and Gender Identity

This final rule eliminates certain provisions of the 2016 Rule that exceeded the scope of the authority delegated by Congress in Section 1557. The 2016 Rule's definition of discrimination “on the basis of sex” encompassed discrimination on the basis of gender identity (“an individual's internal sense of gender, which may be male, female, neither, or a combination of male and female”). In line with that definition, the 2016 Rule imposed several requirements regarding medical treatment and coverage on the basis of gender identity. The same definition also encompassed discrimination on the basis of “termination of pregnancy” without incorporating the explicit abortion-neutrality language of 20 U.S.C. 1688 (which some commenters referred to as the Danforth Amendment) in Title IX, and it imposed a high burden of proof on providers to justify offering gynecological or other single-sex medical services.

All of these are essentially legislative changes that the Department lacked the

authority to make. They purported to impose additional legal requirements on covered entities that cannot be justified by the text of Title IX, and in fact are in conflict with express exemptions in Title IX, even though Title IX provides the only statutory basis for Section 1557's provision against discrimination “on the basis of sex.” For this reason, these provisions have already been vacated and remanded by court order. This final rule omits the vacated language concerning gender identity and termination of pregnancy, thereby bringing the provisions of the Code of Federal Regulations into compliance with the underlying statutes and up-to-date as to the effect of the court's order.

The Department also believes that various policy considerations support this action. The 2016 Rule's provisions on sex discrimination imposed new requirements for care related to gender identity and termination of pregnancy that Congress has never required, and prevented covered entities from drawing reasonable and/or medically indicated distinctions on the basis of sex. As a result, those provisions would have imposed confusing or contradictory demands on providers, interfered inappropriately with their medical judgment, and potentially burdened their consciences. By contrast, under this final rule, each State may balance for itself the various sensitive considerations relating to medical judgment and gender identity, within the limits of applicable Federal statutes (which are to be read according to their plain meaning).

b. Clarification of Scope of Covered Entities

In an additional effort to avoid exceeding the Department's statutory authority, this final rule modifies the 2016 Rule's definition of entities covered by Section 1557 in order to align it more closely with the statutory text.

c. Elimination of Unnecessary or Duplicative Language on Civil Rights Enforcement

This final rule also eliminates provisions of the 2016 Rule that, by unnecessarily duplicating or overlapping with existing civil rights law and regulations, were either inconsistent or redundant with existing law and regulations, and so were likely to cause confusion about the rights of individuals and the corresponding responsibilities of providers. This final rule prohibits any covered entity from discriminating on the basis of race, color, national origin, sex, age, and disability, according to the meaning of these terms in the underlying Federal civil rights statutes that Section 1557 incorporates, and it commits the Department to enforcing these prohibitions through the enforcement mechanisms already available under those statutes' respective implementing regulations. It eliminates the 2016 Rule's definitions of terms and its list of examples of discriminatory practices, as well as its provisions related to discrimination on the basis of association, disparate impact on the basis of sex, health insurance coverage, certain employee health benefits programs, notification of beneficiaries' rights under civil rights laws, designation of responsible employees and adoption of grievance procedures, access granted to OCR for review of covered entities' records of compliance, prohibitions on intimidation and retaliation, enforcement procedures, private rights of action, remedial action, and voluntary action. In all of these matters, this final rule will defer to the relevant existing regulations and the relevant case law with respect to each of the underlying civil rights statutes, as applied to the health context under Section 1557. It will not create, as the 2016 Rule did, a new patchwork regulatory framework unique to Section 1557 covered entities.

d. Elimination of Unnecessary Regulatory Burdens

This final rule modifies provisions of the 2016 Rule that imposed regulatory burdens on covered entities greater than what was needed in order to ensure compliance with civil rights law. Specifically, it eliminates the burdensome requirement for covered entities to send notices and taglines with all significant communications, clarifies that the provision of health insurance, as such, is not a “health program or activity,” brings requirements of meaningful access for persons with limited English proficiency (LEP) into conformity with longstanding DOJ and HHS guidance, and permits remote English-language interpreting services to be audio-based rather than requiring them to be video-based.

The final rule retains numerous other provisions of the 2016 Rule that furthered the goal of civil rights compliance without imposing burdens unnecessary to that goal. These include the obligation for covered entities to submit assurances of compliance, as well as most of the 2016 Rule's provisions ensuring access for individuals with LEP and individuals with disabilities.

e. Other Clarifications and Minor Modifications

This final rule modifies the 2016 Rule's discussion of its own relation to other laws, offering a clearer commitment to implement Section 1557 in conformity with the text of the statutes it incorporates, as well as with the text of numerous other applicable civil rights and conscience statutes. It also makes other minor modifications to the regulatory text.

(2) Related and Conforming Amendments to Other Regulations

a. Title IX

Because the Department's failure to incorporate the abortion neutrality language at 20 U.S.C. 1688 (hereinafter “abortion neutrality”) and the Title IX religious exemption formed part of the

Franciscan

court's reasoning when it vacated parts of the 2016 Rule, this final rule amends the Department's Title IX regulations to explicitly incorporate relevant statutory exemptions from Title IX, including abortion neutrality and the religious exemption.

b. CMS

Ten provisions in CMS regulations, all of which cover entities that are also subject to Section 1557, have in recent years had language inserted that prohibits discrimination on the basis of sexual orientation and gender identity. In light of this final rule's return to the plain meaning of “on the basis of sex” in the civil rights statutes incorporated under Section 1557, and the overarching applicability of Section 1557 to these programs, the Department here finalizes amendments to those regulations to ensure greater consistency in civil-rights enforcement across the Department's different programs by deleting the provisions on sexual orientation and gender identity.

C. Summary of the Costs and Benefits of the Major Provisions

This final rule is an economically significant deregulatory action. The Department projects that this final rule will result in approximately $2.9 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 2016 Rule's provisions related to mandatory notices. 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 existing regulatory requirements regarding the

establishment of grievance procedures. The Department estimates that there will be some additional costs to covered entities regarding training and revision of policies and procedures.

The Department believes that the anticipated benefits—which include consistency with Federal statutes, 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 changes.

Provision(s)

Savings and benefits

Costs

Sec. 1557: Elimination of Overbroad Provisions Related to Sex and Gender Identity

For provisions already vacated, eliminating them brings the Code of Federal Regulations in line with current law. For other provisions, eliminating them restores the rule of law by confining regulation within the scope of the Department's legal authority; restores Federalism by leaving to the States decisions properly reserved to them; and removes unjustified burdens on providers' medical judgment.

No costs are anticipated for provisions already vacated, and any possible costs for related provisions are not calculable based on available data.

Sec. 1557: Clarification of Scope of Covered Entities

Correcting this provision improves the rule of law by interpreting the statute according to its plain meaning as closely as possible.

Costs are not calculable based on available data.

Sec. 1557: Elimination of Unnecessary or Duplicative Language on Civil Rights Enforcement

Eliminating these provisions reduces duplication, inconsistency, and possible confusion in the Department's civil rights regulations, making it easier for covered entities and individuals to know their respective responsibilities and rights.

The Department estimates $275.8 million of costs in the first year for revision of policies and procedures, along with corresponding retraining of employees. (These costs encompass the next listed set of provisions as well.)

Sec. 1557: Elimination of Unnecessary Regulatory Burdens

Eliminating these provisions reduces unnecessary, unjustified, or excessive burdens on health providers, as well as excessive and confusing paper notices for patients. This will make healthcare more affordable and accessible for Americans and is estimated to save $585 million per year over the first five years.

See above.

Sec. 1557: Other Clarifications and Minor Modifications

Amending these provisions improves the rule of law by ensuring that regulations remain subject to statutory protections for conscience and other civil rights, and otherwise contributes to the goals of the other regulatory changes listed above.

No costs are anticipated, and any possible costs are not calculable based on available data.

Title IX regulations, related amendment

This amendment ensures the rule of law by clarifying that Title IX regulations are subject to the statute's own abortion-neutrality language and religious exemption.

No costs are anticipated, and any possible costs are not calculable based on available data.

CMS regulations, conforming amendments

These amendments restore the rule of law by confining regulations within the scope of their legal authority, and ensure consistency in civil-rights enforcement across the Department's different programs.

Costs are not calculable based on available data.

II. Background

On May 18, 2016, the Department finalized a regulation implementing Section 1557 of the ACA. The Department had received 402 comments

in response to a related request for information in 2015, and 24,875 comments

in response to the relevant Notice of Proposed Rulemaking, 80 FR 54172-221 (“2015 NPRM”).

https://www.regulations.gov/docket?D=HHS-OCR-2013-0007.

The comment docket identifies 162 submissions, but some submissions to the docket aggregated multiple comments.

https://www.regulations.gov/docket?D=HHS-OCR-2015-0006.

The comment docket identifies 2,188 submissions, but some submissions to the docket aggregated multiple comments, and “the great majority” of comments were not electronic but were submitted by mail as part of “mass mail campaigns organized by civil rights/advocacy groups.” 81 FR 31376.

Multiple States and private plaintiffs challenged the 2016 Rule in Federal district courts in Texas and North Dakota on the grounds that it violated Federal laws, including the Administrative Procedure Act (“APA”) and the Religious Freedom Restoration Act (“RFRA”).

On December 31, 2016, the U.S. District Court for the Northern District of Texas preliminarily enjoined, on a nationwide basis, portions of the 2016 Rule that had interpreted Section 1557 to prohibit discrimination on the basis of gender identity and termination of pregnancy.

Complaint,

Franciscan All., Inc.

Burwell,

No. 7:16-cv-00108-O (N.D. Tex. Aug. 23, 2016);

Religious Sisters of Mercy

Burwell,

No. 3:16-cv-386 (D.N.D. filed Nov. 7, 2016);

Catholic Benefits Association

Burwell,

No.3:16-cv-432 (D.N.D. filed Dec. 28, 2016).

See Franciscan All., Inc.

Burwell,

227 F. Supp. 3d 660, 696 (N.D. Tex. 2016).

On May 2, 2017, the Department of Justice, on behalf of HHS, filed a motion for voluntary remand to reassess the reasonableness, necessity, and efficacy of the enjoined provisions. On May 24, 2019, HHS issued a notice of proposed rulemaking (“the proposed rule” or “the 2019 NPRM”) to amend the 2016 Rule, as well as its regulations effectuating Title IX,

and to make conforming amendments to certain nondiscrimination provisions of CMS regulations

covered by Section 1557. On June 14, 2019, HHS published the proposed rule in the

Federal Register

and accepted public comment for 60 days thereafter.

20 U.S.C. 1681

et seq.;

45 CFR part 86 (Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance).

42 CFR 438.3, 438.206, 440.262, 460.98, 460.112; 45 CFR 147.104, 155.120, 155.220, 156.200, 156.1230.

84 FR 27846 (June 14, 2019) (“Nondiscrimination in Health and Health Education Programs”).

On October 15, 2019, upon motion of the plaintiffs, and adopting the reasoning from its preliminary injunction order, the U.S. District Court for the Northern District of Texas vacated and remanded the “the unlawful portions” of the 2016 Rule that had been subject to that order.

November 21, 2019, the court clarified that “the Court vacates only the portions of the Rule that Plaintiffs challenged in this litigation,” namely, “insofar as the Rule defines

‘On the basis of sex'

to include gender identity and termination of pregnancy . . . The remainder of 45 CFR part 92 remains in effect.”

Franciscan All., Inc.

Azar,

414 F. Supp. 3d 928, 945 (N.D. Tex. Oct. 15, 2019) (“Since the Court concludes that “the Rule's conflict with its incorporated statute—Title IX—renders it contrary to law under the APA,” the appropriate remedy is

vacatur.

Order 38, ECF No. 62. Accordingly, the Court VACATES and REMANDS the unlawful portions of the Rule for Defendants' further consideration in light of this opinion and the Court's December 31, 2016 Order.”;

id.

at 947 (“The Court ADOPTS its prior reasoning from the

preliminary injunction (ECF No. 62) and now HOLDS that the Rule violates the APA and RFRA. Accordingly, the Court VACATES and REMANDS the Rule for further consideration.”).

Order,

Franciscan Alliance,

No. 7:16-cv-00108-O *2 (N.D. Tex. filed Nov. 21, 2019).

The Department herein finalizes the proposed rule without change, except as set forth below, after careful consideration of and responses to public comments.

III. Response to Public Comments on the Proposed Rule

The Department received 198,845 comments in response to the proposed rule during the public comment period.

Commenters included Members of Congress, State and local governments, State-based Exchanges, tribes and tribal governments, healthcare providers, health insurers, pharmacies, religious organizations, civil rights groups, non-profit organizations, and individuals, among others.

See https://www.regulations.gov/docket?D=HHS-OCR-2019-0007.

The comment docket identifies 155,966 submissions, but some submissions to the docket aggregated multiple comments. HHS estimates the disaggregated number of comments to be 198,845.

A. General Comments

Comment:

Several commenters, including healthcare providers, explained that although they support nondiscrimination in healthcare and equal access to healthcare for all patients, they have difficulty complying with the parameters of the 2016 Rule. They believe that civil rights protections should be balanced against the burdens they create. Accordingly, these commenters support the proposed regulation as it limits the burdens imposed on providers.

Response:

The Department agrees with these commenters' support of nondiscrimination in healthcare and intends to robustly enforce the civil rights authorities. The Department is also cognizant of unduly burdensome regulations. For example, the 2016 Rule did not anticipate some costs to covered entities that range from hundreds of millions to billions of dollars as a result of notice and taglines requirements. Therefore, this final rule seeks to alleviate certain burdens on covered entities while still enforcing the nondiscrimination requirements of Title VI, Title IX, the Age Act, and Section 504.

Comment:

Some commenters said the proposed rule would stabilize services for individuals with disabilities and create a more equitable distribution of health services.

Response:

The Department agrees. This final rule maintains appropriate protections for individuals with disabilities and will provide clarity for providers and individuals.

Comment:

Several commenters expressed concern that eliminating discrimination protections in Section 1557 will cause confusion about patients' rights and remove access to administrative remedies that were previously available.

Response:

The Department recommits itself in this rule to enforcing nondiscrimination on the basis of all categories protected by statute. The Department is confident that the clarity associated with maintaining longstanding prohibitions on discrimination under Title VI, Title IX, the Age Act, and Section 504, and their respective implementing regulations, will outweigh any initial confusion stemming from the change.

Comment:

Some commenters noted the extensive process involved in developing the 2016 Rule, which included a request for information, the 2015 NPRM, and the 2016 Rule, with the Department considering more than 24,875 public comments. Such commenters suggested this proposed rule unnecessarily reopens the 2016 Rule and ignores the reasoned process that the Department had previously completed. Also, a commenter asked why the Department did not publish a request for information before the proposed rule. Others stated that the proposed rule relies disproportionately on a single district court case,

Franciscan Alliance,

to justify a new interpretation of sex. The commenters go on to suggest that the Department relied exclusively on

Franciscan Alliance

to open up the entire 2016 Rule for edits while ignoring numerous other court cases that come to opposing conclusions regarding sex discrimination.

Franciscan Alliance, Inc.

Burwell,

227 F. Supp. 3d 660 (N.D. Tex. 2016).

Commenters cited

Boyden

Conlin,

341 F. Supp. 3d 979 (W.D. Wisc. 2018) (holding Wisconsin's use of transgender exclusions in its state employee health insurance plan constituted sex discrimination in violation of Section 1557 and Title VII);

Flack

Wis. Dept. of Health Servs.,

328 F. Supp. 3d 931, 951 (W.D. Wis. 2018);

Prescott

Rady Children's Hospital-San Diego,

265 F. Supp. 3d 1090, 1098-100 (S.D. Cal. 2017) (finding Section 1557's plain language bars gender identity discrimination);

Tovar

Essential Health,

342 F. Supp. 3d 947, 957 (D. Minn. 2018) (same).

Response:

On December 31, 2016, the

Franciscan Alliance

court preliminarily enjoined the 2016 Rule's gender identity and termination of pregnancy provisions on a nationwide basis, finding them unlawful under the APA and RFRA. A few weeks later, a second Federal district court preliminarily stayed enforcement of the 2016 Rule against two other plaintiffs, citing the

Franciscan

decision.

Because of the nationwide preliminary injunction, the Department could not enforce certain provisions from the 2016 Rule. In the process of reconsidering the 2016 Rule, and consistent with applicable Executive Orders and deregulatory priorities, the Department examined the rule more broadly and concluded that, for the reasons explained in the 2019 NPRM, the 2016 Rule had significantly underestimated the costs and burdens it imposed. Because Section 1557 authorizes, but does not require, the creation of new implementing regulations, the Department considered it appropriate to repeal certain portions of the 2016 Rule and enforce Section 1557 using the underlying regulations the Department has used to enforce the relevant civil rights statutes identified in Section 1557. The Department also considered the Executive Branch's most recent statements concerning the interpretation of statutory provisions that prohibit discrimination on the basis of sex.

Religious Sisters of Mercy

Burwell,

Nos. 3:16-cv-386 & 3:16-cv-432 (D.N.D. Order of January 23, 2017).

See

84 FR 27848.

The Department published its proposed rule in the

Federal Register

on June 14, 2019, opening a two-month public comment period. The Department received nearly 200,000 comments for its review. Through this public comment period, the public was given a full opportunity to provide the Department with information regarding the proposal. It is not necessary to engage in an additional solicitation of public comments through a request for information before the notice of proposed rulemaking. The Department also reviewed the 2016 Rule record and its public comments in considering this final rule.

Through this rulemaking, the Department has provided a comprehensive rationale for this final rule. The 2019 NPRM summarized the Department's legal authority to change the 2016 Rule along with policy rationales for doing so. The quantum of evidence necessary to justify rescinding provisions of a rule is not greater than the evidence needed for issuing it in the

first place.

Moreover, after publication of the proposed rule, the Court in

Franciscan Alliance

issued its final judgment vacating and remanding the unlawful portions of the 2016 Rule for the Department's further consideration. The Department has considered that

vacatur,

along with the legal authorities and policy rationales discussed in the NPRM and this preamble, and more thoroughly calculated the costs and effects of the notice and taglines requirements, to arrive at this final rule. Specific responses to comments on its various provisions, including on sex discrimination, are found below.

See

84 FR 27850;

F.C.C.

Fox Television Stations, Inc.,

556 U.S. 502, 514-15 (2009).

Comment:

Some commenters expressed concern that the updated Section 1557 regulations will have unintended consequences and costs for healthcare providers and individuals seeking healthcare and insurance, particularly pertaining to access standards for people with LEP and communication-based disabilities, in part because the regulatory drafting period was shorter than the period for the 2016 Rule.

Response:

The Department has spent several months carefully reviewing comments, providing responses to them in this rule, and finalizing the proposed rule. The Department is leaving several substantive provisions of the 2016 Rule unchanged or substantially unchanged. The changes largely consist of excisions of regulatory text as opposed to the addition of new text, so it is unsurprising that the regulatory drafting period was shorter than the period for the 2016 Rule. In many instances where new or modified regulatory text was proposed, such text was based on existing guidance or regulatory text. The Department considers this to be an adequate process and a sufficient period of time to engage in such rulemaking.

This final rule maintains vigorous protections for people with LEP and communication-based disabilities, as discussed in detail below, and the Department intends to continue robust enforcement of those protections.

Comment:

Several commenters indicated that the cost savings cited in the proposed rule are unsupported or based on insufficient data. Several commenters also contend that the proposed rule ignores the costs to individuals, especially LEP individuals, who will allegedly encounter additional barriers to accessing healthcare as a result of the proposed changes. Some commenters were concerned that the proposed rule would help eliminate access to a wide range of affordable preventive health services, including cancer screenings, contraception, and reproductive health services. The commenters believe this loss of access will largely be caused by the proposed changes to the definition of sex discrimination. Many commenters expressed concern that the proposed rule would remove civil rights protections for a number of vulnerable groups, including LEP individuals, LGBT individuals, individuals with disabilities, and women seeking reproductive healthcare. Such commenters state that the removal of these protections would, in turn, result in even greater health disparities for these vulnerable populations. Some commenters stated that the proposed rule would lead to increased discrimination in healthcare, which would lead people to delay or forego healthcare and would result in adverse health outcomes and greater overall healthcare costs to individuals. Some of these commenters note that based on these anticipated increased disparities, the proposed rule is effectively encouraging discrimination.

Response:

This final rule leaves in place all statutory civil rights protections for vulnerable groups. Cost savings are treated in the Regulatory Impact Analysis below, which discusses the data, estimates, and assumptions used to support its calculations. Potential health disparities or other alleged costs to individuals or vulnerable groups, including those due to discrimination or barriers to access, are discussed in the relevant sections below (

e.g.,

potential costs to LEP individuals are discussed in comments on those sections of the regulation that deal with national-origin discrimination and/or LEP, while potential costs relating to the gender identity provision are discussed in comments on the section regarding “discrimination on the basis of sex”).

Comment:

Many commenters expressed their belief that this proposed rule diverges from the current body of civil rights laws. These commenters believe that limiting protections based on gender identity, termination of pregnancy, and LEP, runs contrary to civil rights protections.

Response:

Current civil rights laws and their protections are discussed, respectively, in the relevant sections below (

e.g.,

civil rights law on gender identity is discussed in the section on “discrimination on the basis of sex,” because the 2016 Rule had classified gender identity discrimination as a form of sex-based discrimination).

Comment:

Some commenters stated that civil rights protections should not be eliminated because of compliance costs faced by covered entities, and that such balancing runs contrary to the Affordable Care Act and the Administrative Procedure Act. Such commenters argue that if the Department determines that particular protections are too costly or onerous, it should advance more limited protections rather than eliminating them entirely.

Response:

This final rule does not, and could not, repeal or eliminate specific protections under any of the four civil rights statutes referenced in Section 1557, and it does not remove the protections provided by the implementing regulations for those statutes.

The Department has, however, chosen to reduce some excessive burdens that were applied to covered entities by the 2016 Rule, but were not required by Section 1557, where the relevant civil rights protections could be enforced using the underlying regulations without the unnecessary burdens imposed by the 2016 Rule.

Comment:

Commenters stated that the Department exceeded its authority by proposing this rule. Some commenters indicated that the Department's positions as advanced in the proposed rule are not worthy of deference under the framework established in

Chevron, U.S.A., Inc.

Nat. Res. Def. Council, Inc.,

467 U.S. 837 (1984), because the proposed rule is contrary to clear congressional intent and is inconsistent with the agency's past policies concerning sex protections. Many of these commenters assert that the changes set forth in the proposed rule run contrary to the requirements of the ACA, pointing to 42 U.S.C. 18114 (Section 1554), which states that the Department shall not “promulgate any regulation that—(1) creates any unreasonable barriers to the ability of individuals to obtain appropriate medical care; (2) impedes timely access to health care services. . .” These commenters also state that the Department is attempting to make a legislative change through an administrative action. Some commenters contend that the proposed rule runs contrary to the general intent of the ACA, namely that all individuals should be provided access to healthcare.

Response:

The 2016 Rule tried to make essentially legislative changes through administrative action, and those changes were rightly held to be in violation of the APA. The Department does not exceed its authority by rescinding the portions of the 2016 Rule that exceeded the Department's authority. The Department also does not

violate Section 1554 of the ACA by not including the gender identity and termination of pregnancy provisions in this final rule, which were not supported by the text of the underlying civil rights laws incorporated in Section 1557, and in addition were vacated by court order.

With respect to both Sections 1554 and 1557, the Department interprets the ACA by the plain meaning of its text, and as will be shown below, this final rule brings the Department's Section 1557 regulations in line with a proper understanding of the ACA's text. Parts of the 2016 Rule exceeded the Department's authority under the ACA, and this final rule formally eliminates those portions from the Code of Federal Regulations. The Department believes this approach adheres more closely to the text of the statutes referenced in Section 1557, along with the regulations that the Department has used to implement those statutes for decades. Other parts of the 2016 Rule are being modified or repealed in order to save providers from unnecessary burdens not required by the ACA, so that they are better able to achieve the statute's goal of providing healthcare access to all Americans. Such a reconsideration and elimination of certain regulatory provisions, particularly regulations that the ACA itself did not require to be issued, neither “creates” unreasonable regulatory barriers nor impedes timely access to healthcare. If it were otherwise, Section 1554 would essentially serve as a one-way ratchet, preventing the Department from ever reconsidering a regulation that could be characterized as improving access to healthcare in some sense, regardless of the other burdens such regulation may impose on access to health care. The Department's approach in this final rule is also consistent with the Ninth Circuit's recent interpretation of Section 1554: “[t]he most natural reading of § 1554 is that Congress intended to ensure that HHS, in implementing the broad authority provided by the ACA, does not improperly impose regulatory burdens on doctors and patients.”

As explained throughout the preamble, the Department's rule avoids precisely such burdens by bringing the section 1557 regulations into alignment with the longstanding requirements of the applicable civil rights laws and their implementing regulations (thereby also avoiding additional conscience burdens that the 2016 Rule potentially imposed) and by removing notice and taglines requirements that imposed unjustified burdens on the healthcare system as a whole (some of which would likely have been passed on to individuals).

California

Azar,

No. 19-15974, 2020 WL 878528, at *18 (9th Cir. Feb. 24, 2020 (en banc).

Comment:

Commenters said that Section 1557 should be construed broadly because throughout the ACA, Congress prohibited a variety of forms of discrimination, such as against pre-existing conditions and combating health disparities. Commenters also indicated that the ACA is intended to reduce the cost of healthcare discrimination against the poor, so the Section 1557 rule should implement cost sharing and other insurance requirements.

Response:

In the ACA, Congress labeled several provisions other than 1557 as prohibiting discrimination

in healthcare, but did not incorporate those other provisions of the ACA into Section 1557. Those other provisions are different from the civil rights provisions set forth in Section 1557 in substance, implementation, and enforcement. This final rule commits the Department to robust enforcement of the nondiscrimination grounds applicable under Section 1557.

See, e.g.,

ACA Section 2701 (“discriminatory premium rates”); Section 2716 (“discrimination based on salary”); Section 2705 (“discrimination against individual participants and beneficiaries based on health status”); Section 2716 (“discrimination in favor of highly compensated individuals”).

Comment:

A commenter contended that the Department provided little or no legal, policy, or cost-benefit analysis along with the proposed rule and combined too many changes into a single rule. Some commenters claimed the proposed rule is arbitrary, capricious, and contrary to law, is inconsistent with the agency's mission, and lacks reasoned explanations justifying the policy reversals. Other commenters stated that HHS failed to account for the extensive history of healthcare discrimination, and provided no contrary data to counter the original factual findings in the 2016 Rule. Furthermore, they said that individuals have reasonably placed their reliance upon the Federal government to protect their civil rights as explained in the 2016 Rule.

Response:

The Department provided ample legal, policy, and cost-benefit analysis for the proposed rule and provides additional support here for the final rule.

The Department proposed changes to the provisions of the 2016 Rule because that rule exceeded the Department's authority under Section 1557, adopted erroneous and inconsistent interpretations of civil rights law, caused confusion, imposed unjustified and unnecessary costs, and conflicted with applicable court decisions. It is unfortunate that, by administrative action, the 2016 Rule may have unreasonably raised expectations about nondiscrimination protections that are not found in the underlying statutes, but this final rule cannot be held responsible for that. The Department gave extensive reasons for its changes in the 2019 NPRM, and gives further reasons in response to comments below. The public comment process provided adequate opportunity to present legal, policy, and cost-benefit analyses, all of which were considered in finalizing this rule, as discussed herein.

See

45 FR at 27875-88.

The Department also updates and discusses the regulatory impact analysis based on comments and data received. While there are still some questions addressed by this final rule where robust data are unavailable, were not found by the Department, or have not been brought to the Department's attention, the Department is allowed to engage in rulemaking even where the impact of a rule change is difficult or impossible to quantify. The Department has diligently considered the relevant and significant data of which it is aware.

There is no artificial limit on the number of changes a proposed rule may contain—or on the number of parts in the Code of Federal Regulations that can be addressed in a rulemaking. This final rule contains many fewer changes than the 2016 Rule did, and it substantially streamlines the existing 1557 regulation as opposed to enlarging it. Its inclusion of conforming changes to various CMS regulations still gives the final rule a size and scope that is well within the range of other significant proposed rules.

Comment:

Several commentators stated that the proposed rule's language that Title IX and Section 1557 must be “exercised with respect for State sovereignty” runs contrary to the Supreme Court's decision that Congress has the authority to prohibit discrimination in commercial activity.

Response:

This final rule does not, nor does the Department intend to, remove any protection against State action that Congress has provided by statute. It also does not deny States the ability to provide protections that exceed those required by Federal civil rights law. The reference to State sovereignty simply refers to the Department's intention to protect the States by respecting their sovereignty to the extent that doing so does not infringe on Federal law.

Comment:

One commenter noted that, after the 2016 Rule was passed, the

Department released resources and educational materials, including fact sheets, to explain the 2016 Rule. The commenter requested that the Department release similar resources and educational materials following the finalization of this rule.

Response:

The Department is providing the responses to comments contained in this preamble to clarify issues and answer questions concerning this final rule. Furthermore, the Department continues to be committed to providing resources and educational materials to explain civil rights requirements and to assist covered entities with compliance with civil rights statutes and the regulations thereunder, including this regulation.

B. Section 1557 Regulation, Subpart A: General Requirements and Prohibitions

The Department proposed changes to the Section 1557 rule at 45 CFR part 92 to be composed of Subpart A on general requirements and prohibitions, and Subpart B on specific applications related to disability nondiscrimination and language access.

(1) Proposed Repeal of Definitions in § 92.4 of the 2016 Rule

Comments:

A commenter contended that eliminating the definitions section in the Section 1557 Regulation would cause confusion, misinterpretation, and inconsistency of terms among the regulations that currently reference or otherwise rely on the underlying definitions in the 2016 Rule.

Response:

In significant part, the definitions section of the 2016 Rule duplicates definitions already incorporated into the Section 1557 regulation by reference, and hence creates either inconsistency or redundancy. In other cases, the 2016 Rule contained definitions inconsistent with the text of applicable statutes; indeed, on those grounds, a Federal district court vacated the 2016 Rule's definition of “on the basis of sex” insofar as it encompassed gender identity and termination of pregnancy. The Department will continue to enforce Section 1557 using HHS regulations for the underlying civil rights statutes. Many of these regulations have definition sections and operate based on longstanding understandings of how the laws are enforced.

Comments:

Some commenters argued that eliminating the phrases “covered entities” and “health program or activities” would allow many plans and programs to be exempt from the Section 1557 regulation. Other commenters stated that the existing definitions provide clarity and consistency for covered entities. Another commenter stated that the proposed rule would limit Section 1557's application to the specific program or activity that receives Federal assistance, rather than a healthcare entity's entire operations.

Response:

See below, under “Scope of Application in Proposed § 92.3,” for a discussion of the entities subject to this final rule.

Comment:

Some commenters asked the Department to retain the definition of “auxiliary aids and services” concerning effective communication for individuals with disabilities. They also asserted that the Department has altered important definitions related to effective communication, without explanation or acknowledgement. While some commenters appreciated the Department's efforts to incorporate many of the current definitions of Title II of the Americans with Disabilities Act

(“ADA”), some claim the Department has erred in tracking the language of those definitions.

42 U.S.C. 12101

et seq.

Response:

The Department is not required to track ADA definitions in its Section 1557 regulation. This final rule applies many definitions based on those found in the ADA or its regulations (including “disability” and “auxiliary aids and services”), technical definitions and standards under the ADA, and Uniform Federal Accessibility Standards as promulgated; as discussed below, it also departs from ADA definitions in certain cases. Additionally, this final rule retains effective communication standards for individuals with disabilities under § 92.102; these provisions are drawn from regulations promulgated by the Department of Justice implementing Title II of the ADA.

Specific definitions and provisions related to individuals with disabilities are discussed below.

42 U.S.C. 12311;

See also

84 FR at 27861-62 (discussing the Department's statutory interpretation).

45 CFR 92.2 (applying the final rule, in relevant part, to “every

health

program or activity administered by the Department; and every

health

program or activity administered by a Title I entity”) (emphasis added).

Comment:

Commenters argued that the proposed interpretation to limit coverage to HHS Title I programs or activities would exclude a number of important programs and activities operated by HHS and is inconsistent with Section 504's application to “any program or activity conducted by an

Executive Agency.”

They point out that HHS's Section 504 regulation applies to “all programs or activities” conducted by HHS and all its components, including CMS, HRSA, CDC, and SAMHSA.

Further, commenters stated that excluding non-Title I HHS-administered programs and activities, contrary to Section 504, will result in confusion and cause illogical results, whereby recipients would be covered by Section 1557 but the agencies administering the program would not be covered. For example, State Medicaid programs would be subject to Section 1557, but CMS, which oversees those Medicaid programs, would not be covered.

29 U.S.C. 794 (applying to “any program or activity receiving Federal financial assistance or under any program or activity conducted by any Executive agency or by the United States Postal Service”).

45 CFR, part 85.

Response:

Section 1557 is a nondiscrimination statute under the ACA, which uniquely applies to healthcare, whereas Section 504 is a statute of general applicability. Section 1557 incorporates Section 504's prohibited grounds of discrimination but not its scope: Section 1557's scope differs from that of the underlying statutes. For instance, Section 504 does not include “contracts of insurance” in its definition of Federal financial assistance,

but this final rule follows the text of Section 1557 by including “contracts of insurance” within Federal financial assistance.

With respect to CMS, it is covered under this final rule to the extent that it either administers health programs and activities receiving Federal financial assistance or administers programs and activities under Title I. In addition, it is important to note that, as a federal agency, CMS has long been subject to various constitutional and statutory prohibitions on discrimination.

45 CFR 84.3(h).

42 U.S.C. 18116(a).

c. § 92.3(b): Scope of the Term “Health Program or Activity”

The Department proposed in § 92.3(b) to clarify that “health program or activity” encompasses all of the operations of entities “principally engaged in the business of providing healthcare” that receive Federal financial assistance. The Department proposed to further clarify that for any entity not principally engaged in the business of providing healthcare, such entity's operations are subject to the Section 1557 Rule only to the extent any such operation receives Federal financial assistance provided by the Department.

Comment:

Commenters opposed limiting application of the rule when the entity is not principally engaged in the business of providing healthcare. Commenters argued that this would dramatically limit the scope of the rule and is contrary to Congressional intent and the plain meaning of the statute, which covers “any health program or activity, any part of which is receiving Federal financial assistance. . . .” Commenters stated that the entire entity receiving Federal financial assistance should be covered, not just the portion receiving funding. Commenters also argued the new framework would cause uncertainty and confusion for covered entities, which would have to clarify the extent of their own compliance, and also would make it harder for consumers to enforce their rights because they would have difficulty determining which entities and which portion of their programs or activities are subject to the rule. Commenters contended this uncertainty could result in lack of access to care, increased health disparities, and increased uncompensated care, all of which would increase overall healthcare costs.

Some commenters stated that the rule incorrectly incorporates the Civil Rights Restoration Act (CRRA)

into Section 1557. Commenters argued that the CRRA predates the ACA; nothing in the CRRA's text applies it to future statutes or Section 1557; Congress did not incorporate the CRRA into the Section 1557 statute; and Section 1557 itself is more expansive than the laws amended by the CRRA. Therefore, they say, a broader definition of covered programs and activities should apply to include all health insurers as covered entities. Others argued that the proposed rule's application of the CRRA contravenes the approach taken by Congress in the CRRA. They stated that Congress made clear in the CRRA that if any part of a program or activity receives Federal financial assistance, the entire program or activity must comply with the applicable civil rights laws. Thus, the commenters argued that the proposed rule's limited application when entities are not principally engaged in the business of healthcare, to cover only the specific operation that receives Federal financial assistance, is contrary to the CRRA. Another commenter stated that incorporating the CRRA into Section 1557 would be subject to judicial review, to the extent the Department relies on Section 1557's references to “grounds” and “enforcement mechanisms” of the underlying statutes to do so, because the Supreme Court held in

Consolidated Rail Corp.

Darrone

that a statute's incorporation of another statute's enforcement mechanisms does not necessarily incorporate its substantive law.

Public Law 100-259, 102 Stat. 28 (Mar. 22, 1988).

See Consolidated Rail Corp.

Darrone,

465 U.S. 624, 635 (1984) (holding that Section 504's incorporation of the “remedies, procedures, and rights” set forth in Title VI did not mean that Section 504 incorporated Title VI's substantive limitations on actionable discrimination).

Conversely, other commenters were supportive of reducing regulatory burden by limiting application of the rule in this way. They stated that the 2016 Rule defined “covered entities” far too broadly, and that narrowing the scope will help rein in the regulatory excess of that rule. Commenters explained that healthcare entities often provide a variety of services and products, such as insurance coverage for life, disability, or short-term limited duration insurance coverage, and third-party administrative services, which do not receive Federal financial assistance. These commenters agreed that Section 1557 is intended to apply only to those programs receiving Federal funding and not to other parts of the entity's businesses or products when an entity is not principally engaged in the business of providing healthcare.

Response:

Section 1557 explicitly incorporates statutes amended by the CRRA, and in this final rule the Department is aligning Section 1557's definition of “health program or activity” with the standard articulated in the CRRA in order to provide clarity and consistency. The CRRA clarified the scope of nondiscrimination prohibitions under the civil rights statutes that Section 1557 incorporates. For example, with respect to the health sector, it applied those prohibitions to all health programs or activities receiving Federal financial assistance, but not to all providers of health insurance: It applied “program or activity” to cover all of the operations of an entity only when that entity is “principally engaged in the business of providing . . . health care . . . .”

This final rule clarifies that the term “health program or activity” used in Section 1557 should be understood in light of the CRRA's limitations on the term “program or activity” as applied to statutes on which Section 1557 relies. As for

Consolidated Rail Corp.

Darrone,

Congress specifically and intentionally

overturned that case through the passage of the CRRA.

See, e.g.,

CRRA § 3(a) (adding § 908(3)(A)(ii) to Title IX of the Education Amendments of 1972 (codified at 20 U.S.C. 1687(3)(A)(ii)).

See McMullen

Wakulla Cty. Bd. of Cty. Commissioners,

650 F. App'x 703, 705 (11th Cir. 2016), citing S. Rep. No. 100-64, at 2 (1988),

as reprinted in

1988 U.S.C.C.A.N. 3, 3-4.

The 2016 Rule also articulated a standard for “health program or activity” that relied upon the “principally engaged” prong of the CRRA, which was contested neither before nor after that rule's publication. In the regulatory text, the 2016 Rule defined “health program or activity” to apply to all operations of an entity only when it is principally engaged in providing or administering health services, health insurance coverage, or other health coverage.

The 2016 Rule preamble clarified that if an entity is not principally engaged in providing health benefits, the Department would apply the rule to its Federally funded health programs and activities.

81 FR at 31467. In the proposed rule, the Department disagreed with the 2016 Rule's usage of “health services, health insurance coverage, or other health coverage” as overbroad and inconsistent with the statutory text of the CRRA that uses the term “healthcare.”

See

84 FR at 27862-63. However, the Department agrees with the 2016 Rule's limitation based on whether the entity is principally engaged.

81 FR at 31385-86, 31430-32.

The Department believes that by specifying the degree to which the Section 1557 regulation covers entities not principally engaged in the business of providing healthcare, this final rule more clearly and consistently applies the CRRA's limitations on “health program or activity” across the regulation. The Department agrees with commenters who suggest that in doing so this final rule also advances its goal of reducing regulatory burdens under the ACA in furtherance of Executive Order 13765.

Comment:

Commenters argued that limiting the application of the rule to only the portion of the health program or activity that receives Federal financial assistance for entities not principally engaged in the business of providing healthcare is not consistent with the Department's application of Title VI as set forth in HHS's 2003 LEP guidance. This guidance provided that Title VI applies to all parts of a covered entity receiving Federal financial assistance, not just the portion receiving Federal funds.

68 FR 47311, 47313 (Aug. 8, 2003) (“Coverage extends to a recipient's entire program or activity,

i.e.,

to all parts of a recipient's operations. This is true even if only one part of the recipient receives the Federal assistance.”).

Response:

As a policy guidance document, the Department's LEP guidance cannot be used to create binding standards by which the Department will determine compliance with existing regulatory or statutory requirements.

Accordingly, the scope of application as set forth under the CRRA and this final rule would prevail over any conflicting text in the Department's LEP guidance.

See

U.S. Dept. of Justice, Memorandum of the Office of the Attorney General, Prohibition on Improper Guidance Documents (Nov. 16, 2019),

https://www.justice.gov/opa/press-release/file/1012271/download;

U.S. Dept. of Justice, Memorandum of the Office of the Associate Attorney General, Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases (Jan. 25, 2018),

https://www.justice.gov/file/1028756/download.

d. § 92.3(c) Health Insurance and Healthcare

The Department proposed in § 92.3(c) to state that an entity principally or otherwise engaged in the business of providing health insurance would not be considered to be principally engaged in the business of providing healthcare, and on that sole basis, subject to the Section 1557 regulation. The proposed rule sought comment on whether it should define “healthcare” in the rule according to the statutes cited in the proposed rule.

Comment:

Several commenters supported the distinction between entities principally engaged in the business of providing healthcare and those principally engaged in the business of providing health insurance. As one commenter stated, “[p]aying for healthcare is not providing healthcare.” Other commenters were opposed to this distinction. They argued that it is not consistent with Section 1557's statutory text or the proposed regulatory text at § 92.3(a)(1), both of which specifically include “contracts of insurance” as an example of Federal financial assistance. They also stated that this limited application is not consistent with Congressional intent to expand access to healthcare and create new nondiscrimination protections in health insurance.

Some commenters argued that health insurance is inextricably linked with the provision of healthcare. They pointed out that the statutory definition of “healthcare” relied upon in the proposed rule is unrelated to either the ACA, health insurance, or discrimination, and thus is not intended for or relevant to Section 1557 or health insurance.

Further, they argued that the definition of “health insurance coverage” referenced in the proposed rule, 42 U.S.C. 300gg-91, actually bolsters the argument that health insurance includes healthcare, as it defines “health insurance coverage” to include “benefits consisting of

medical care

(provided directly, through

insurance

or reimbursement, or otherwise and including items and services paid for as medical care)” (emphasis added). They also pointed out that definitions in 42 U.S.C. 300gg-91 are most relevant to Section 1557 because Title I of the ACA relied upon this section for definitions.

See

84 FR at 27862 (citing the definition of “health care” at 5 U.S.C. 5371). Commenters noted that this definition pertains to Federal personnel pay rates.

Response:

The CRRA defined “program or activity” in the underlying statutes to apply to all of an entities' operations when it is principally engaged in the business of providing “healthcare.” On the other hand, the 2016 Rule expansively interpreted Section 1557's application to “health programs or activities” to include all operations of entities that “provide health insurance coverage or other health coverage,” whether or not they provided healthcare. Prior to the 2016 Rule, the Department had not interpreted the CRRA's term “healthcare” to cover the operations of health insurance issuers (as such).

Commenters are correct that Section 1557 includes “contracts of insurance” as a type of Federal financial assistance. The Department agrees that health programs or activities that receive contracts of insurance from the Federal government are covered entities under Section 1557. But this does not mean that health insurers, as such, are health programs or activities.

The Department pointed to 5 U.S.C. 5371, as well as to 45 CFR 160.103, in order to support its conclusion that the plain meaning of “healthcare” differs from insurance. And although 42 U.S.C. 300gg-91 explicitly encompasses payment, “group health plans,” and “definitions relating to health insurance” specifically, it should not be taken out of context: It defines “medical care” as “amounts paid for” certain medical services, which is an appropriate definition in the health insurance field but not in the healthcare field generally. (When a doctor provides “medical care,” she is not providing “amounts paid for” medical services—she is providing the services themselves.) Other portions of 42 U.S.C. 300gg-91 also support the distinction between healthcare and health insurance: It says that “health insurance coverage means benefits consisting of medical care,” where “medical care” is defined as “amounts paid for . . . the diagnosis, cure, mitigation, treatment, or prevention of disease, or amounts paid for the purpose of affecting any structure or function of the body,” or

“amounts paid for transportation primarily for and essential to medical care” in the primary sense just defined, or “amounts paid for insurance covering medical care” in either the primary sense just defined or the secondary sense of transportation for medical care.

It does not say that health insurance is healthcare, and it twice relies on the commonsense distinction between medical care proper and the health insurance that covers and pays for such care. It thus supports the Department's view that a health insurer is principally engaged in the business of providing coverage for benefits consisting in healthcare, which is not the same as the business of providing healthcare. This final rule brings the 1557 regulation's scope of coverage closer to the plain meaning of the 1557 statute, especially as read in light of the CRRA's definition of “program or activity.”

42 U.S.C. 300gg-91(b)(1), (a)(2).

Comment:

Commenters were concerned that § 92.3(c) would result in exempting many of the plans, products, and operations of most health insurance issuers, such as self-funded group health plans, the Federal Employees Health Benefits (FEHB) Program, third-party administrator services, or short-term limited duration insurance plans. Commenters feared this would allow health insurance issuers to conduct their other activities in a discriminatory manner. Several commenters were particularly concerned about excluding short-term limited duration insurance plans because these plans have been known to engage in discriminatory practices based on disability, age, and sex.

Other commenters, in contrast, supported the proposed revisions. They stated the 2016 Rule was overly expansive, created an un-level playing field, and resulted in disincentives for issuers to participate in HHS-funded programs, such as offering QHPs or Medicare Advantage plans. This resulted in Section 1557's covering products that Congress explicitly excluded from the rest of the ACA, such as excepted benefits and short-term limited duration insurance plans. Commenters argued it was unlikely that Congress intended Section 1557 to regulate the same plans it had excluded from the ACA.

Response:

The Department agrees with commenters who stated that the overly broad reach of the 2016 Rule subjected many insurance products that were not intended to be covered by the ACA to burdensome regulation, inconsistent with Congressional intent.

In the proposed rule, the Department stated that Section 1557 does not apply to short-term limited duration insurance as such, but only if it were offered by an entity for which all of the entity's activities are encompassed by Section 1557, or if such insurance received Federal financial assistance.

Under this final rule, where short-term limited duration insurance (1) is offered by an entity that is not principally engaged in the business of providing healthcare, and (2) does not receive Federal financial assistance, the protections of Section 1557 would not apply to it. The Department will robustly enforce the nondiscrimination requirements for QHPs under Title I of the ACA, for Exchange plans established by the ACA, and for any other insurance plans that Section 1557 covers. The reasons that this final rule does not cover FEHB plans are discussed in the response to the next comment.

The Department notes by way of background that, subsequent to publication of the proposed rule, the U.S. District Court for the District of Columbia granted summary judgment for the Department, upholding its most recent rulemaking on short-term limited duration insurance.

See

Short-Term, Limited-Duration Insurance; Final Rule, 83 FR 38212 (August 3, 2018). The August 2018 final rule largely restored the long-standing definition for short-term limited duration insurance to the definition that was in effect from 1997 to 2016. The Court held that the restored definition was not arbitrary or capricious, finding that “Congress clearly did

not

intend for the [ACA] to apply to all species of individual health insurance.”

Association for Community Affiliated Plans

U.S. Department of Treasury,

392 F. Supp. 3d 22, 45 (D.D.C. 2019),

appeal filed

July 30, 2019.

Comment:

The Department received comments related to the exclusion of employer plans and excepted benefits as a result of § 92.3(c). Several commenters objected to the exclusion of self-funded group health plans under the Employee Retirement Income Security Act of 1974 (ERISA) and the Federal Employees Health Benefits (FEHB) Program. Commenters argued that FEHB plans should be covered as a contract of insurance with the Federal government. Some suggested that employer group health plans, including self-funded plans, receive substantial Federal financial assistance in the form of favorable income tax treatment and thus should be covered.

Other commenters strongly supported excluding employer plans. Commenters noted that employers and group health plans are already subject to other Federal laws that prohibit discrimination, and that few employer-sponsored plans receive Federal financial assistance. They stated that the 2016 Rule's broad coverage exceeded statutory authority, encumbered the design and operation of employer group health plans, invited litigation regarding plan benefits, and increased the potential for costly new mandates, all of which were likely to increase healthcare costs for employers and employees alike without adding any additional protections against discrimination. Some commenters expressed support for the provision that third-party administrators of self-funded group health plans would no longer be subject to Section 1557 merely because other portions of their business receive Federal funding.

Some commenters requested further clarification by recommending that the regulatory text at proposed § 92.3(c) be revised to specify that other types of plans should not be considered entities principally engaged in the business of providing healthcare, including self-funded or fully insured group health plans under ERISA; self-funded or fully insured group health plans not covered under ERISA that are sponsored by either governmental employers (“government plans”) or certain religious employers (“church plans” or “denominational plans”); and benefit plans and programs excepted under the ACA.

See

42 U.S.C. 300gg-91(c) (defining excepted benefits).

Response:

The Department continues to take the position that FEHB plans are not covered under this rule. Even if FEHB plans were considered “contracts of insurance,” as suggested by some commenters, they still would not fall under the scope of this rule because the contract would be with the Office of Personnel Management (OPM), which operates the FEHB Program, not with the Department. As noted above, this final rule does not extend the Department's enforcement authority to a covered entity that is not principally engaged in the business of providing healthcare to the extent of its operations that do not receive financial assistance from the Department.

The Department agrees that this final rule will accomplish the Department's goal of reducing regulatory burden. The Department declines to offer further examples of non-covered entities in the regulatory text, as the rule's existing parameters are intended to broadly address different entities. To the extent that employer-sponsored group health plans do not receive Federal financial assistance and are not principally engaged in the business of providing healthcare (as set forth in the rule), they would not be covered entities. The same analysis would apply to employer-sponsored plans not covered by ERISA, such as self-insured church plans or

non-Federal governmental plans, as well as to excepted benefits.

Comment:

Some commenters said that the proposed rule created confusion about whether QHPs are subject to the rule. Others requested clarification on the proposed rule's application to products offered through the Exchange. Others requested clarification on whether stand-alone dental plans and catastrophic plans, which are also sold through the Exchanges established under Title I, are covered under the rule. Another commenter requested confirmation that the proposed rule would not apply to individual or small-group market health insurance coverage that complies with the ACA but is sold outside of the Exchanges, regardless of whether the parent organization also offers on-Exchange QHPs. Others requested clarification as to how the rule would apply when one health insurance plan includes multiple types of enrollees, including subsidized Exchange enrollees, unsubsidized Exchange enrollees, and off-Exchange enrollees. The comments expressed concern that enrollees in the same plan deserved the same level of nondiscrimination protection and that the same standard should be applied.

Response:

Health insurance products are often complex. While the Department provides general responses below in an attempt to clarify application of the rule, OCR will always engage in an individualized fact-based analysis when determining the extent of its jurisdiction over these or any other such products.

A QHP would be covered by the rule because it is a program or activity administered by an entity established under Title I (

i.e.,

an Exchange), pursuant to § 92.3(a)(3). A QHP could also be subject to Section 1557 if it were a recipient of Federal financial assistance, but as stated above, the premium tax credits that the Department plays a role in administering would no longer serve to bring an entity under the jurisdiction of this Section 1557 regulation.

Stand-alone dental plans and catastrophic plans offered through the Exchanges would similarly be subject to § 92.3(a)(3), as these plans are administered by an Exchange, which is an entity established under Title I.

Regarding ACA-compliant plans sold off-Exchange, because a health insurance issuer is not principally engaged in the business of providing healthcare, its operations would be subject to this rule only for the portion that receives Federal financial assistance. The issuer's components (

e.g.,

off-Exchange plans) that do not directly receive Federal financial assistance would not be subject to this rule.

Where a health insurance plan includes multiple types of enrollees, the Department would have to review the specific circumstance, but generally speaking, if a QHP is subject to Section 1557, this rule would apply consistently for all enrollees in the plan.

Comment:

The Department received comments related to how the rule would apply to Medicare- and Medicaid-related products. One commenter asked whether the proposed limitation under § 92.3(c) would mean that Section 1557 would no longer apply to health insurance plans managed through Medicare and Medicaid.

A few commenters requested clarification on whether the proposed rule would apply to Employer Group Waiver Plans (EGWPs) and Medicare Part D Retiree Drug Subsidy (RDS) plans, or the employers that sponsor the plans. Commenters argued that applying the rule to these plans could disincentivize employers from sponsoring them and urged that the plans be exempt from the rule. Alternatively, one commenter requested that the Department exempt employer sponsors of “800 series” EGWPs, which are offered by Medicare Advantage Organizations (MAOs) or Part D Plan sponsors (PDP sponsors), because the employer is not the entity that receives funding from HHS. Finally, some commenters objected to excluding Medicare Part B from the rule.

Response:

To be covered by the rule, a particular entity would have to satisfy one of the applicability requirements set forth in § 92.3. Entities that receive Federal funding through the Department's Medicare Part C (Medicare Advantage), Medicare Part D, or Medicaid programs would be subject to Section 1557 as recipients of Federal financial assistance. This would include Medicare Advantage plans, Medicaid managed care plans, EGWPs, or RDS plans, to the extent that they receive Federal financial assistance.

Pending further details, an employer that does not directly contract with CMS but offers an “800 series” EGWP through a MAO or PDP sponsor would not appear to be subject to this rule under this analysis because the employer does not receive the Federal financial assistance; meanwhile, the health insurance issuer offering the EGWP would be subject to the rule for its EGWP plan, due to receipt of either Medicare Part C or Part D funding.

As for Medicare Part B, it is not Federal financial assistance.

This remains unchanged from the 2016 Rule, which also determined that Medicare Part B was not Federal financial assistance under Section 1557.

45 CFR pt. 80 App A, No. 121;

https://www.hhs.gov/civil-rights/for-individuals/faqs/what-qualifies-as-Federal-financial-assistance/301/index.html. See also

81 FR at 31383, 31385; 84 FR at 27863 (discussing the applicability of the rule to Medicare Part B and clarifying in footnote 100 that “[t]he 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).”).

Comment:

Some commenters requested that this final rule be accompanied by explicit applicability guidance so that employers and plans could be able to ascertain if the final rule impacts their business.

Response:

The Department seeks to provide sufficient clarity in this final rule. If OCR receives substantial questions about the rule's applicability after publication, OCR will consider issuing additional clarification, consistent with applicable law regarding issuance of sub-regulatory guidance.

See, e.g.,

Executive Order 13892 on Promoting the Rule of Law Through Transparency and Fairness in Civil Administrative Enforcement and Adjudication, 84 FR 55239 (Oct. 9, 2019); Executive Order 13891 on Promoting the Rule of Law Through Improved Agency Guidance Documents, 84 FR 55235 (Oct. 9, 2019); U.S. Dept. of Justice, Memorandum of the Office of the Associate Attorney General, Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases (Jan. 25, 2018),

https://www.justice.gov/file/1028756/download;

U.S. Dept. of Justice, Memorandum of the Office of the Attorney General, Prohibition on Improper Guidance Documents (Nov. 16, 2019),

https://www.justice.gov/opa/press-release/file/1012271/download.

e. Summary of Regulatory Changes

For the reasons given in the proposed rule, and having considered comments received, the Department finalizes the proposed § 92.3, and repeal of § 92.2 of the 2016 Rule, without change, except that, as discussed in an earlier section of this preamble, and after considering comments on the issue, the Department is not finalizing the proposed repeal of § 92.2(c) concerning severability, but is retaining that provision and has moved it to § 92.3(d).

(4) Nondiscrimination Requirements in Proposed Revisions to § 92.2, and Repeal of § 92.8(d), 92.101, 92.206, 92.207, 92.209, and Appendix B of the 2016 Rule

The Department proposed to repeal § 92.8(d), 92.101, 92.206, 92.207, and Appendix B of the 2016 Rule (which includes repealing notice and taglines

provisions), and instead address nondiscrimination requirements in a new § 92.2. The Department proposed to repeal provisions that made applicable across all protected categories those particular requirements, prohibitions, or enforcement mechanisms that had previously applied only to particular circumstances.

The Department requested comments on all aspects of the proposed rule. The Department also specifically requested comment on any unaddressed discrimination on the basis of race, color, or national origin as applied to State and Federally-facilitated Exchanges, with any detailed supporting information. And the Department requested comment on whether, and if so how, the proposed rule addresses clarity and confusion over compliance requirements and the rights of persons protected against discrimination on the basis of race, color, national origin, sex, disability, or age.

The Department received many comments on these proposed changes. The Department will first discuss comments concerning each of the grounds in Section 1557: Race, color, national origin, disability, age, and sex. Then other grounds of discrimination will be discussed, followed by assessment of claims of discriminatory conduct when multiple grounds of discrimination are alleged. Comments concerning disability and LEP protections will be addressed below in the section on Subpart B of the Section 1557 rule.

a. Discrimination on the Basis of Race, Color, or National Origin

i. Generally

Comment:

The Department received support for its commitment to continued enforcement of race, color, and national origin protections. Commenters stated that these characteristics are clear and simple to distinguish, contrasting them with gender identity, which is fluid and more difficult to define.

Response:

The Department appreciates the support for its continued commitment to the enforcement of protections against discrimination on the basis of race, color, and national origin. The Department agrees that gender identity as a category is difficult to define. This is not, however, the Department's reason for not viewing gender identity as a protected category under Section 1557. The Department enforces statutory prohibitions on discrimination on the basis of race, color, national origin, age, disability, and sex discrimination because they are set forth in the text of statutes incorporated into Section 1557, and gender identity is not set forth as a protected category in those statutes.

Comment:

Commenters contended that the proposed changes, including repeal of § 92.101 and the specific discrimination it prohibited, will lead to confusion among individuals and lead healthcare providers to discriminate based on race, color, and national origin. Commenters recommended that the Department retain clear, strong language prohibiting healthcare providers from discriminating based on race, color and national origin.

Response:

This final rule's § 92.2 retains clear, strong language prohibiting discrimination on the basis of race, color, or national origin. Covered entities are still required to provide the Department with an assurance, and, pursuant to the underlying civil rights regulations, to post notices, that they do not so discriminate and are in compliance with Federal civil rights law. If the Department learns of confusion among covered entities or individuals as to their civil rights, it will consider issuing further guidance as needed.

Comment:

Some commenters contended that the proposed changes will negatively impact women of color, who (according to these commenters) disproportionately rely on the short-term health plans that this final rule does not cover, and are more likely to experience pregnancy-related issues that will cause them to suffer from the rollback of termination of pregnancy protections.

Response:

For reasons detailed below, this final rule (a) does not generally apply to short-term limited duration health insurance and (b) only covers termination of pregnancy to the extent permitted by Title IX's abortion-neutrality language, as required by the relevant statutes. The Department will vigorously enforce the prohibitions on discrimination based on race or sex, including under disparate impact analysis with respect to race discrimination as provided for in the relevant Title VI regulations, but the Department remains bound by the limits of the statutes enacted by Congress. The Department's Office of Minority Health also supports outreach to diverse populations and those facing particularized or disproportionate health challenges.

Comment:

One commenter expressed concern that the changes in the proposed rule will have a negative impact on access to health screenings and vaccinations for patients. The commenter stated that removal of nondiscrimination requirements for many health insurance providers will leave these populations with little recourse if health insurance providers rescind coverage for preventative health services.

Response:

Because this final rule continues to commit the Department to robust enforcement of its prohibitions on discrimination on the basis of race, color, national origin, sex, age, and disability, the Department does not anticipate that it will impede any population's access to preventive care and vaccinations, which (under separate provisions of the ACA) must be covered without cost sharing for group health plans and health insurance issuers offering group or individual health insurance coverage.

See

42 U.S.C. 300gg-13.

ii. Repeal of Notice and Taglines Provisions at § 92.8(d) and Appendix B of the 2016 Rule

The Department proposed to repeal § 92.8(d) of the 2016 Rule, which required a nondiscrimination notice and taglines in all significant communications from covered entities, and also proposed to repeal the sample taglines notice in Appendix B to Part 92. 84 FR at 27857-60. The Department stated its assumption that this will correspondingly ease the burden of the LEP provision in CMS regulations at 45 CFR 155.205(c)(2)(iii)(A), which deemed compliance with the LEP provisions of the Section 1557 regulation to constitute compliance with CMS's requirements.

84 CFR 27887, n. 240, and 27881.

The Department specifically sought comment to identify “significant communications” under the 2016 Rule sent by covered entities that include a notice and taglines but had not been considered by the analysis in the proposed rule, as well as the estimated annual volume of such communications. The Department also requested comment on which communications are significant in healthcare.

Comments:

Some commenters stated that the removal of the 2016 Rule's notice and taglines provisions will result in LEP beneficiaries having less knowledge of available language assistance services and that they will likely rely more on family members to provide oral interpretation.

Response:

The regulations of the underlying statutes referred to in Section 1557 (Title VI, Section 504, Title IX, and the Age Act) have long mandated that covered entities provide

a notice of nondiscrimination.

This final rule maintains that requirement. Moreover, it continues to require covered entities to provide taglines whenever such taglines are necessary to ensure meaningful access by LEP individuals to a covered program or activity. It removes only the unduly broad, sometimes confusing, and inefficient requirement that all significant communications contain taglines. This requirement caused significant unanticipated expenses, as discussed in the regulatory impact analysis (RIA) below. Moreover, as discussed below, § 92.101 of this final rule reiterates longstanding criteria to help covered entities conduct an individualized assessment of their program and ensure meaningful access by persons with LEP, and retains the 2016 Rule's prohibition on covered entities' requiring an LEP individual to provide his or her own interpreter or relying on an accompanying adult to interpret or facilitate communication (except in limited circumstances).

See

Title VI (45 CFR 80.6 and Appendix to Part 80), Section 504 (45 CFR 84.8), Title IX (45 CFR 86.9), and the Age Act (45 CFR 91.32).

Comment:

Some commenters disagreed with the Department's proposal to make conforming amendments to the CMS requirements placed on Health Insurance Exchanges and Qualified Health Plan (QHP) issuers at 45 CFR 155.205. These commenters argued that the CMS requirements do not rely on the 2016 Rule's taglines provisions, nor does the 2016 Rule prevent the implementation of additional requirements in more specific programs, such as Medicaid and Medicare. Others agreed with the Department's proposal, raising concerns about CMS's requirements at 45 CFR 155.205, which state that Exchanges and QHP issues are only “deemed” in compliance with the CMS requirements “if they are in compliance with” the 2016 Rule's taglines provisions. These commenters argued that if the notice and taglines provisions are removed, the CMS compliance provision will cross-reference a repealed rule, which would require QHP issuers and Exchanges to comply with CMS's taglines rule instead. The CMS mandate for 15 taglines for the CMS list of critical documents is arguably as burdensome as the 2016 Rule's taglines provisions; therefore, these commenters argue that any benefit in efficiency yielded by the repeal of the 2016 Rule's taglines provisions would be lost for Exchanges and QHP issuers. These commenters suggest amending the 2016 Rule's provisions to state that there is no specific taglines requirement under Section 1557 and that a covered entity's compliance under applicable Federal and State laws will be considered under Section 1557's LEP meaningful access standards.

Response:

The provision at 45 CFR 155.205(c)(2)(iii)(A) and the similar requirement placed on QHP issuers (see HHS Notice of Benefit and Payment Parameters for 2016; Final Rule, 80 FR 10750, 10788 (Feb. 27, 2015)), have not been directly amended in this regard. Nevertheless, as the Department stated in the proposed rule,

both of those requirements depend on or refer to the taglines requirements repealed in this final rule. As a result, covered entities are deemed compliant with those particular taglines requirements due to this final rule. Specifically, 45 CFR 155.205(c)(2)(iii)(A) sets forth taglines requirements and then states, “Exchanges, and QHP issuers that are also subject to § 92.8 of this subtitle, will be deemed in compliance with paragraph (c)(2)(iii)(A) of this section if they are in compliance with § 92.8 of this subtitle.” The Department informed the public of this interpretation in the proposed rule, and after reviewing public comments, the Department maintains the same position for essentially the same reason. Because this final rule repeals the taglines requirements of the 2016 Rule at § 92.8, entities will not be out of compliance with those requirements, and therefore they will satisfy the condition of the sentence quoted above from 45 CFR 155.205(c)(2)(iii)(A) that they not be out of compliance with taglines requirements in 45 CFR part 92. Although the Department did not propose conforming amendments to those two regulations, and therefore cannot finalize such amendments in this final rule, the Department will consider making appropriate changes to other regulations in the future.

84 FR at 27881.

Comment:

Commenters, including a health insurance issuer, noted that the 2016 Rule's preamble vaguely defined “significant communications” to 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. These commenters argued that because almost all written communications would be considered “significant” under this definition, most covered entities included a one- to two-page addition containing the nondiscrimination notice and taglines with most written communications. One health insurance issuer estimated sending the notice and taglines approximately 15 million times in 2018, or about five times for every individual served. One commenter stated that because the Department determined that the notice and taglines requirement in the 2016 Rule imposes a significant financial burden on covered entities, the Department is within its authority to rescind it, especially because of an executive order that limits the effectiveness of subregulatory guidance. Others requested that the Department issue further guidance on what constitutes “significant” documents and communications, instead of removing the 2016 Rule's notice and taglines provisions.

Response:

The Department agrees with comments that stated the 2016 Rule's notice and taglines requirements were imprecise and overly burdensome. The Department declines to retain those requirements while merely issuing more guidance on what constitute significant communications. First, the requirements are not mandated by statute, and although the 2016 Rule is a regulation and not subregulatory guidance, the Department has determined that its financial burden on covered entities was not justified by the protections or benefits it provided to LEP individuals. Second, the Department believes that other protections as finalized in this rule (and discussed below) better serve the language access needs of LEP individuals and, therefore, are more appropriate. Repeal of the notice and taglines requirements in this rule does not repeal all other notice and taglines requirements that exist under other statutes and rules.

b. Discrimination on the Basis of Disability

The Department is committed under this final rule to enforce protections against discrimination on the basis of disability, both in specific provisions set forth in § 92.102-92.105, and as applicable through the underlying Section 504 regulations, which are more broadly applicable under Section 1557 of the ACA. Comments on these issues are discussed in the section below on Subpart B of the Section 1557 regulation.

c. Discrimination on the Basis of Age

Comment:

Commenters expressed concerns that the changes in the proposed rule will lead to discriminatory practices in health plans. In the absence of explicit language prohibiting health plans from discriminating based on age as set forth in § 92.207 of the 2016 Rule, they alleged, health plans may unlawfully

deny, cancel, or limit policies, deny or limit coverage for claims, impose additional cost-sharing on coverage, or use discriminatory marketing practices or benefit designs because of age. In particular, some commenters believe that health insurance plans will offer formularies and plan options that deny treatment for older individuals who generally have more health complications. For example, they say, this practice may already be in place with some health plans that offer coverage for hearing aids to children and youths but deny it to older adults. Some commenters said the proposed rule will lead to discrimination against older LGBT adults, who already have high levels of poverty and health disparities, and will contribute to worse health outcomes. Some commenters also alleged the proposed rule encourages unlawful discrimination against LGBT youth, who are already at increased risk of discrimination.

Response:

This final rule retains clear language prohibiting discrimination on the basis of age, as defined in the Age Act and enforced through its implementing regulations, in any covered programs and activities, including health plan marketing and benefit design. Moreover, the ACA has specific provisions which limit the extent to which health plans offered under the ACA can charge higher premiums based on age, as well as specific provisions which require guaranteed issuance, address permissible cost sharing requirements, and establish standards for essential benefits and formularies.

The Department remains committed to vigorous enforcement of this prohibition on behalf of all Americans, including LGBT adults and youth. The Department declines to comment on specific cases outside of the normal enforcement process but encourages anyone who has experienced unlawful discrimination, including with respect to health plans, to file a complaint with OCR.

Comment:

Commenters expressed concern that the proposed rule will lead to health plans using their benefit design to discriminate against individuals with chronic conditions who are more expensive to insure, including children and youth with serious health conditions. One commenter represented a 13 year old with Down syndrome who, the commenter said, was denied coverage by a private health insurer because that health insurer categorically denied coverage for individuals with Down syndrome.

Response:

Many serious health conditions, including Down syndrome, qualify as disabilities under Section 504, which Section 1557 incorporates. The Department will enforce vigorously Section 1557's prohibition on discrimination on the basis of disability against all covered entities, including when discrimination is alleged to have taken place in benefit design. As finalized, the amended § 147.104 would prohibit health insurance issuers from employing “benefit designs that . . . 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.” The ACA also establishes requirements, applicable to health insurance issuers offering individual and group health insurance, concerning guaranteed issuance and renewal.

Concerns about whether private health insurers are covered entities are addressed below in the section on this rule's scope of application.

See

42 U.S.C. 300gg-1, 300gg.2.

Comment:

Some commenters contended the proposed rule will allow health plans to place age restrictions on certain medications, such as age restrictions on contraceptives for youth.

Response:

To the extent that covered entities (including health plans) place restrictions based on age, OCR would assess on a case-by-case basis whether such restrictions violate Section 1557's incorporation of grounds prohibited under the Age Act. The Age Act does not forbid certain age distinctions in Federal, State, or local statutes and ordinances, or an action that reasonably takes age into account as a factor that is necessary to the normal operation or achievement of a statutory objective of a program.

45 CFR 90.14, 90.15.

d. Discrimination on the Basis of Sex

i. Generally

Comment:

Commenters offered different points of view on the definition of the term “sex,” as this relates to the definition of discrimination “on the basis of sex.”

A number of commenters stated that the Department had proposed a new definition of “sex” for the Section 1557 rule. Some objected that any reinterpretation of “sex” should be addressed by Congress or left to the courts, rather than administrative agencies. Others stated that the proposed regulations realign the Department's interpretation with several decades of Federal court decisions and with the logical interpretation based on the statute's plain meaning of sex (namely sex in its biological meaning), which until 2017 had been the consistent consensus of the Federal courts.

Some commenters said that sex is a binary reality of male and female, and that Title IX and Section 1557 apply this historic understanding of sex. Some commenters stated that there is no evidence in the legislative history of either Title IX or the ACA that Congress intended to prohibit gender identity or sexual orientation discrimination in Section 1557, and that the purpose of Title IX is to ensure women (as biologically distinct from men) equal opportunities in Federally funded programs and activities.

Commenters said that the 2016 Rule exceeded the Department's authority by adopting a new, different, or expansive definition of prohibited sex discrimination in its Section 1557 regulation, although Congress declined to do so when presented with the opportunity and instead incorporated its meaning from Title IX which was passed in 1972. Some commenters noted that Congress has repeatedly considered adding gender identity and sexual orientation as protected categories in nondiscrimination laws related to education,

or to employment,

or in bills that would redefine discrimination “on the basis of sex”

as the 2016 Rule attempted, but that Congress has chosen not to do so.

Where Congress has chosen to prohibit “gender identity” discrimination in other statutes, it added the term “gender identity” as a

new and separate category of prohibited grounds in addition to “sex” without redefining “sex” itself.

Other commenters said that reliance on legislative history is an improper method of statutory interpretation, and that the Supreme Court has deemed reliance on Congressional inaction to be inappropriate.

Commenters cited 118 Cong. Rec. 5808 (1972); 44 FR at 71423.

See,

e.g., Student Non-Discrimination Act of 2018,

H.R. 5374, 115th Congress, 2nd sess.; online at:

https://www.congress.gov/115/bills/hr5374/BILLS-115hr5374ih.pdf

: “No student shall, on the basis of actual or perceived sexual orientation or gender identity . . . be excluded from participation in, or be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance.”

See, e.g., Employment Non-Discrimination Act of 2013,

S. 815, 113th Congress, 1st sess.; online at:

https://www.govtrack.us/congress/bills/113/s815/text

: “It shall be an unlawful employment practice for an employer—(1) to fail or refuse to hire or to discharge any individual, or otherwise discriminate against any individual . . . because of such individual's actual or perceived sexual orientation or gender identity . . .”

See, e.g., Equality Act,

H.R. 5, 116th Congress, 1st sess.; online at:

https://www.congress.gov/116/bills/hr5/BILLS-116hr5rfs.pdf

; amends

Civil Rights Act of 1964

“by striking `sex,' each place it appears and inserting `sex (including sexual orientation and gender identity)' . . .”

See

H.R. 1652, 113th Cong. (2013); S. 439, 114th Cong. (2015). H.R. 3185, 114th Cong. (2015); S. 1858, 114th Cong. (2015); H.R. 2015, 110th Cong. (2007); H.R. 2981, 111th Cong. (2009); S. 811, 112th Cong. (2011);

See

H.R. 4636, 103rd Cong. (1994).

18 U.S.C. 249(a)(2).

One commenter cited U.S. Supreme Court cases as setting forth the binding legal standard of sex discrimination as a binary biological concept. The commenter cited

Tuan Anh Nguyen

I.N.S.

as rejecting an approach of “[m]echanistic classification of all our differences as stereotypes” because it obscures the reality that “physical differences between men and women . . . are enduring,” 533 U.S. 53, 73 (2001), as well as Justice Ginsburg's majority opinion in

United States

Virginia,

which held that “ `[T]he two sexes are not fungible; a community made up exclusively of one [sex] is different from a community composed of both.' ” 518 U.S. at 533 (1996).

Some commenters stated that changing cultural preferences should not be the standard for interpreting legal texts. Others analogized Title IX's lack of a definition of “sex” to the lack of a definition of “race” under the Civil Rights Act of 1964, where courts looked to the plain and ordinary meaning to interpret it as based on a person's “family, tribe, people, or nation belonging to the same stock.” Other commenters cited analyses of public meanings at the time of adoption, concluding that when “gender” was used, which was rare, it was used in contrast to sex: Gender referred to socially constructed roles, while sex, according to virtually every dictionary of the time, referred to biological differences between men and women.

Other commenters stated that use of the term “gender” (with regard to one's identity) as separate from “sex” (with regard to one's biology) is relatively new and is improperly interpreted today as evidence of support for gender-identity legal theories in prior legal precedents or decades-old statutes. Some commenters asserted that at the time of the passage of the underlying Federal civil rights statutes, “sex” and “gender” were commonly used identically under Title VII, Title IX, and the Equal Protection Clause to refer to biological sex.

However, other commenters disagreed, and stated that historical sources demonstrate the variability and complexity of the concept of sex to include “[t]he sum of the morphological, physiological, and behavioral peculiarities of living beings.”

Commenters cited Joanne Meyerowitz, A History of “Gender,” 113 a.m. Hist. Rev. 1346, 1353 (2008); David Haig, The Inexorable Rise of Gender and the Decline of Sex: Social Change in Academic Titles, Archives of Sexual Behavior 1945-2001 (Apr. 2004); Sari L. Reisner,

et al.,

“Counting” Transgender and Gender-Nonconforming Adults in Health Research,

Transgender Studies

Quarterly 37 (Feb. 2015); New Oxford Am. Dictionary 721-22, 1600 (3d ed. 2010).

See Glenn

Brumby,

663 F.3d 1312, 1315 (11th Cir. 2011) (citing

City of Cleburne

Cleburne Living Ctr., Inc.,

473 U.S. 432, 440-41 (1985). (“In describing generally the contours of the Equal Protection Clause, the Supreme Court noted its application to this issue, referencing both gender and sex, using the terms

interchangeably

. . .”).

Some commenters stated that the terms male or female apply to everyone. Commenters stated that the “sex” of an organism is a clear, provable, objective, identifiable, biological, and binary reality according to relevant textbooks, studies, and articles from various specialties in the scientific community, including embryology, genomics, psychiatry, clinical anatomy, neuropsychology, developmental biology, genetics, endocrinology, neuropsychiatry, radiology, organismic and evolutionary biology, neuropharmacology, pediatrics, and pathology.

Healthcare providers stated that the reality of sex, as male or female, can be identified through advanced chromosomal testing such as karyotyping or simple genital identification at birth in roughly 99.98% of cases, leaving the remaining 0.02% as diagnoses with intersex or ambiguous conditions. Others stated that delineating a binary division on the basis of reproductive organs reflected an outdated paradigm and was not universally descriptive of transgender, transitioning, androgynous, intersex, two-spirit, or questioning individuals.

Commenters cited texts including,

e.g.,

T.W. Sadler, Ph.D.,

Langman's Medical Embryology

(Philadelphia: Lippincott Williams & Wilkins, 2004), 40; William J. Larsen, Ph.D.,

Human Embryology

(New York: Churchill Livingstone, 2001), 519; Keith L. Moore, Ph.D., DSc, and T.V.N. Persaud, M.D., Ph.D. DSc, FRCPath.,

The Developing Human: Clinically Oriented Embryology

(Philadelphia: Saunders/Elsevier, 2003), 35; Maureen L. Condic, Ph.D. and Samuel B. Condic, Ph.D., “Defining Organisms by Organization,” National Catholic Bioethics Quarterly 5, no. 2 (Summer 2005): 336; Lawrence S. Mayer, Ph.D., and Paul R. McHugh, M.D., “Sexuality and Gender Findings from the Biological, Psychological, and Social Sciences,”

New Atlantis

50 (Fall 2016): 89; Scott F. Gilbert, Ph.D.

Developmental Biology

(Sunderland, Mass.: Sinauer Associates, 2016), 519-20; and William J. Larsen, Ph.D.,

Human Embryology

(New York: Churchill Livingstone, 2001), 307; Nichole Rigby, M.A. and Rob J. Kulathinal, Ph.D., “Genetic architecture of sexual dimorphism in humans,”

J. of Cellular Physiology

230, no. 10 (2015): 2305; Jonathan C.K. Wells, Ph.D., “Sexual dimorphism of body composition,”

Best Practice & Research: Clinical Endocrinology & Metabolism

21 (2007): 415; Larry Cahill, Ph.D., “His Brain, Her Brain,”

Scientific American,

October 1, 2012; Larry Cahill, Ph.D. “A Half-Truth Is a Whole Lie: On the Necessity of Investigating Sex Influences on the Brain,”

Endocrinology

153 (2012): 2542; Madhura Ingalhalikar, Ph.D., et al., “Sex differences in the structural connectome of the human brain,”

Proceedings of the National Academy of Sciences

111 (January 2014): 823-28.

Some commenters stated that removal of a regulatory definition of “sex” leaves the regulation ambiguous, and the 2016 Rule was justified in clarifying by adding a definition that included gender identity and termination of pregnancy. Other commenters stated that the public widely understands the state of being either male or female, as determined by one's chromosomes or genetics, which leaves no ambiguity.

Response:

Because Section 1557 incorporates Title IX's prohibition on discrimination “on the basis of sex,” it presupposes that the executive and judicial branches can recognize the meaning of the term “sex.” This final rule repeals the 2016 Rule's definition of “on the basis of sex,” but declines to replace it with a new regulatory definition.

See

84 FR at 27857. Instead, the final rule reverts to, and relies upon, the plain meaning of the term in the statute.

“Sex” according to its original and ordinary public meaning refers to the biological binary of male and female that human beings share with other mammals. As noted in briefs recently submitted by the Federal government to the Supreme Court, discrimination on the basis of sex means discrimination on the basis of the fact that an individual is biologically male or female.

Several commenters reference various sources of legislative history: That of Title IX, of Congress's decision to add protections on the basis of sexual orientation and gender identity to other statutes alongside protections on the basis of sex, and of Congress's repeated refusal to add those protections in other cases.

These sources support the plain

meaning of Title IX, but are not the only source of support for the Department's understanding of the meaning of the word “sex.” Contemporaneous dictionaries and common usage make clear that “sex” in Title IX means biological sex.

Even today, the article on gender dysphoria in the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition defines “sex” to “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.”

The term “gender” may sometimes be ambiguous. However, neither Title IX nor Section 1557 uses that term, and the ordinary public meaning of the term “sex” in Title IX is unambiguous. In order to avoid ambiguities associated with the term “gender,” the Department's regulations and guidance have, where relevant, distinguished sex (in its biological meaning) from gender, gender identity, or gender expression.

Bostock

Clayton Cty. Bd. of Commissioners,

2019 WL 4014070 at *25 (U.S. 2019) (Brief for the United States as

Amicus Curiae

Supporting Affirmance in No. 17-1618 (

Bostock

Clayton Cty. Bd. of Commissioners

) and Reversal in No. 17-1623 (

Altitude Express Inc.

Zarda

)); Statement of Interest for DOJ,

Soule

Conn. Ass'n of Schools,

3:20-cv-00201-RNC (D. Conn., filed March 27, 2020) at 4-5 (“When Congress enacted Title IX in 1972, the `ordinary, contemporary, common meaning' of `sex' was biological sex. . . . Title IX consistently uses `sex' as a binary concept capturing only two categories: Male and female.”).

Examples of bills where Congress chose not to enact prohibitions on discrimination on the basis of sexual orientation or gender identity include: The Employment Non-Discrimination Act (ENDA), which has been introduced ten times in the U.S. House of Representatives but has never proceeded out of committee: 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). Similarly, the Equality Act has been introduced in three successive sessions of Congress; it did not proceed out of committee in the 114th and 115th Congresses, and it passed the House of Representatives on May 17, 2019.

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).

See

New Oxford Am. Dictionary 721-22, 1600 (3d ed. 2010). Some Federal courts have gone farther, using the legislative history to show that “Congress never considered nor intended” for sex under Title VII (which is often used to interpret Title IX) to apply to “anything other than the traditional concept of sex,” and that coverage for a concept such as transgender status “surely” would have been mentioned in the legislative history had Congress intended such an “all-encompassing interpretation.” The Department finds the analysis in these Court decisions persuasive, but declines to rely on their reasoning.

See Ulane

Eastern Airlines Inc.,

742 F. 2d 1081, 1085 (7th Cir. 1984) (analyzing “The total lack of legislative history supporting the sex amendment coupled with the circumstances of the amendment's adoption”);

See also

42 U.S.C. 1681(a)(2)(6)(“fraternity” and “sorority”).

See

language such as “male and female,” “both sexes,” “each sex,” “one sex . . . the other sex,” and “boys” and “girls,” at 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.

See

similarly 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.

Federal courts have also made this observation.

See, e.g., Doe

Boyertown Area Sch. Dist.,

897 F.3d 518, 522 (3d Cir. 2018) (“`Sex' is defined as `the anatomical and physiological processes that lead to or denote male or female.' Typically, sex is determined at birth based on the appearance of external genitalia.”);

Hively

Ivy Tech Cmty. Coll.,

853 F.3d 339, 362 (7th Cir. 2017) (“[i]n common, ordinary usage in 1964—and now, for that matter—the word `sex' means biologically

male

female.”

) (Sykes, J., dissenting) (emphasis in original);

cf. id.

at 357 (“we, who are judges rather than members of Congress, are imposing on a half-century-old statute a meaning of `sex discrimination' [to include sexual orientation] that the Congress that enacted it would not have accepted.”) (Posner, J., concurring);

G.G. ex rel Grimm

Gloucester Cnty. Sch. Bd.,

822 F.3d 709, 736 (4th Cir. 2016) (“Title IX was enacted in 1972 and the regulations were promulgated in 1975 and readopted in 1980, and during that time period, virtually every dictionary definition of `sex' referred to the physiological distinctions between males and females, particularly with respect to their reproductive functions.”) (Niemeyer, J., dissenting); Statement of Interest for DOJ,

Soule

Connecticut Association of Schools,

3:20-cv-00201-RNC (D. Conn., filed March 27, 2020) at 5 (“Other provisions of Title IX employ “sex” as a binary term, and thus provide further confirmation that the prohibition on “sex” discrimination does not extend to discrimination on the basis of transgender status or gender identity.”);

Franciscan All., Inc.

Burwell,

227 F. Supp. 3d 660, 687 (N.D. Tex. 2016) (“the meaning of sex unambiguously refers to the biological and anatomical differences between male and female students as determined at their birth,” quoting

Texas

United States,

201 F. Supp. 3d 810, 833 (N.D. Tex. 2016));

Johnston

Univ. of Pittsburgh of Commw. Sys. of Higher Educ,

97 F. Supp. 3d 657, 676 (W.D. Pa. 2015) (“[o]n a plain reading of the statute, the term `on the basis of sex' in Title IX means nothing more than male and female, under the traditional binary conception of sex consistent with one's birth or biological sex”).

Statement of Interest for DOJ,

Soule

Conn. Ass'n of Schools,

3:20-cv-00201-RNC (D. Conn., filed March 27, 2020) at 5.

Prior to the ACA, OCR itself had always applied Title IX in its enforcement actions using the biological binary meaning of sex.

Recently, OCR has resolved a number of Section 1557/Title IX cases of discrimination against women in healthcare programs and activities funded by the Department, again relying on a biological understanding of sex.

The 2016 Rule itself presupposed the biological meaning of sex when it permitted “sex-specific” health programs that are “restricted to members of one sex,” when it incorporated “termination of pregnancy” into discrimination on the basis of sex, and when it referred repeatedly to “sex assigned at birth.”

In the 2015 NPRM, the earliest record of the Department's new understanding of sex discrimination cited was an OCR letter dated 12 July 2012. 80 FR 54176.

U.S. Department of Health and Human Services, “HHS Office for Civil Rights Enters Into Agreement with Oklahoma Nursing Home to Protect Patients with HIV/AIDS from Discrimination” (2018),

https://www.hhs.gov/about/news/2017/09/08/hhs-office-for-civil-rights-enters-into-agreement-with-oklahoma-nursing-home.html

; “OCR works with DOJ to ensure Federally funded medical center provides communication services for deaf and hard of hearing patients” (2018),

https://www.hhs.gov/about/news/2017/12/20/ocr-works-with-doj-to-ensure-Federally-funded-medical-center-provides-communication-services-for-deaf-and-hard-of-hearing-patients.html

; “HHS OCR Secures Agreement with MSU to Resolve Investigation into Sexual Abuse by Larry Nassar” (2019),

https://www.hhs.gov/about/news/2019/08/12/hhs-ocr-secures-agreement-msu-resolve-investigation-sexual-abuse-larry-nassar.html

(requiring chaperone policies where patients can request a chaperone of the same sex, meaning biological sex, during sensitive physical examinations).

See

81 FR 31384, 31387, 31406, 31408-09, 31428, 31429, 31435, 31436, 31467, 31470, 31471, 31472.

Supreme Court case law on Title IX has consistently presupposed the biological and binary meaning of “sex.”

Even when some lower courts have recently extended Title VII or Title IX protections “on the basis of sex” to encompass gender identity, they have done so only by presupposing the ordinary public meaning of “sex” as a biological binary reality. In

Whitaker

Kenosha Unified Sch. Dist.,

for example, the Seventh Circuit stated: “Here, the School District's policy cannot be stated without referencing sex, as the School District decides which bathroom a student may use based upon the sex listed on the student's birth certificate. This policy is inherently based upon a sex‐classification and heightened review applies.”

Likewise, in

Harris Funeral Homes,

the Sixth Circuit stated: “Here, we ask whether Stephens would have been fired if Stephens had been a woman who sought to comply with the women's dress code. The answer quite obviously is no. This, in and of itself, confirms that Stephens's sex impermissibly affected Rost's decision to fire Stephens.”

In other words, Stephens “quite obviously” is not “a woman” because “Stephens's sex” is male.

See, e.g., Nat'l Collegiate Athletic Ass'n

Smith,

525 U.S. 459, 464 (1999) (Title IX claim based on allegation “that the NCAA discriminates on the basis of sex by granting more waivers from eligibility restrictions to male than female postgraduate student-athletes”);

Cannon

Univ. of Chicago,

441 U.S. 677, 680 (1979) (Title IX claim based on allegation that plaintiff's “applications for admission to medical school were denied . . . because she is a woman”).

858 F.3d 1034, 1051 (7th Cir. 2017).

Equal Emp't Opportunity Comm'n

R.G. & G.R. Harris Funeral Homes,

884 F.3d 560 (6th Cir. 2018), 575.

See also

certain passages during oral argument on appeal at the U.S. Supreme Court,

e.g.:

“here, Ms. Stephens, was being treated differently because of her sex. . . .Yes, if she had not been a—if she had not been assigned at birth the sex that she was assigned at birth, she would have been treated differently” (Kagan, J., Transcript of Oral Argument at 41,

R.G. & G.R. Harris Funeral Homes, Inc.

E.E.O.C.,

139 S. Ct. 1599 (2019) (No. 18-107),

https://www.supremecourt.gov/oral_arguments/argument_transcripts/2019/18-107_4gcj.pdf

);

See also

Mr. Cole, counsel for respondents at oral argument,

Id.

at 4-5: “None of [our] arguments ask this Court to redefine or, in Judge Posner's words, upd

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