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Iowa Healthcare Law Blog News & Updates on Legal, Policy, & Business Issues Facing the Health Care Industry in Iowa


Posted in Affordable Care Act (ACA), Health and Human Services (HHS)

Physicians subject to the Rule must meet notice and posting obligations by October 16, 2016.

The federal Department of Health and Human Services (HHS), through its Office for Civil Rights (OCR), has published its final Rule implementing Section 1557 of the Affordable Care Act (ACA), 42 U.S.C. 18116, prohibiting discrimination in health care programs and activities. The new Rule, like Section 1557, specifically focuses its prohibitions and requirements on four already existing federal nondiscrimination laws: 1) Title VI of the Civil Rights Act of 1964, prohibiting discrimination based on race, color and national origin; 2) the Age Discrimination Act of 1975; 3) Section 504 of the Rehabilitation Act of 1973; and, 4) the sex discrimination provisions of Title IX of the Education Amendments of 1972 (extended by Section 1557 to health care). Section 1557 is in addition to rights and remedies available under these four laws. While the nondiscrimination prohibitions of Section 1557 have been in effect since passage of the ACA in March of 2010, this final Rule advises health care consumers of their Section 1557 rights and informs affected health care programs and activities of their Section 1557 obligations.

The Nondiscrimination Rule became effective on July 18, 2016, except for extended time periods set forth in the Rule. The Rule can be found either in the May 18, 2016 Federal Register, with the actual Rule found on pp. 31465-31473, or in the Code of Federal Regulations at 45 C.F.R. Part 92. This post addresses 1) physicians who are “covered” by the Nondiscrimination Rule; 2) administrative obligations covered physicians must satisfy; and 3) the general scope of prohibited discriminatory practices regularly impacting covered medical practices.

First steps physicians are encouraged to consider to assure compliance under the Rule include:

  • Determine whether the physician is a covered entity under this Rule. Most are.
  • Develop the practice’s nondiscrimination notice and, for small-sized publications and communications, the practice’s nondiscrimination statement as well as multi-language tagline language assistance statements for posting in office locations, on the physician’s practice website, and in significant publications and communications consistent with the requirements of the Rule prior to October 16, 2016.
  • For physician practices with 15 or more employees, designate an individual to coordinate compliance under the Rule and develop grievance procedures for receipt and investigation of complaints.
  • Become familiar and assure compliance with the Rule’s requirements for language assistance for individuals with limited English proficiency (LEP) and for auxiliary aids and assistance for individuals who are disabled.
  • Be aware that covered entity physicians are prohibited by this Rule from discriminating based on sex, including gender identity, in the provision of medical or other program services.
  • Determine whether the medical practice offers employee health benefit programs subject to the Rule’s Nondiscrimination requirements and assure compliance.

As noted throughout this post, definitions in the Rule are important to understanding the Rule’s prohibitions and requirements.

  1. Physicians as covered entities subject to Section 1557 and the HHS Nondiscrimination Rule

Physicians are subject to Section 1557 enforcement and the compliance requirements of the Nondiscrimination Rule if they are “covered entities.” Being a covered entity under the Nondiscrimination Rule is not the same as being a HIPAA covered entity. A physician is a Section 1557 covered entity if the physician operates a health program or activity, any part of which receives Federal financial assistance.

“Health care programs or activities” subject to the Rule includes the provision or administration of health-related services as well as assistance to individuals in obtaining health-related services. Hospitals,  ambulatory surgical centers, physician practices, Federally qualified health centers, nursing facilities, residential or community-based treatment facilities, laboratories, home health agencies, hospices, group health plans, health insurance issuers, and other similar entities fall within the definition of a health program or activity. State Medicaid, CHIP, and Basic Health programs also come within this definition.

“Federal financial assistance” is broadly defined to include any grant, loan, credit, subsidy, contract (including a contract of insurance but not a procurement contract), or any other arrangement involving the provision of funds, services, or property by the Federal government. In its rulemaking comments, HHS identifies Federal funding situations that either do or do not subject physicians to Section 1557 jurisdiction and the requirements of the Nondiscrimination Rule.

To begin, HHS sticks to the OCR’s long-stated position that receipt of Medicare Part B payments, standing alone, does not constitute Federal financial assistance. Payments to physicians by a health plan issuer which, itself, is a recipient of Federal financial assistance also do not constitute Federal financial assistance, nor does either employment by a hospital which receives Federal financial assistance or receipt of Federal student loan monies through an educational institution, the intended recipient, even when loan monies are passed on to the student who then makes payments to the educational institution.

HHS points to “numerous” other ways, however, in which a physician would be a recipient of Federal financial assistance. Cited examples include Medicare meaningful use and other similar incentive payments; Medicaid payments; grants from the National Health Service Corps (NHSC); National Institute of Health (NIH) funding; Health Resources Service Administration (HRSA)-funded community health centers; Substance Abuse and Mental Health Services Administration (SAMHSA)-funded programming; and CMS gainsharing demonstration projects. Too, HHS notes that many physicians will be obligated to meet the requirements of the Nondiscrimination Rule through contracts they sign with health plans who, themselves, are covered entities obligated to ensure compliance with Federal nondiscrimination requirements by network providers treating their enrollee beneficiaries. Even hospital-employed physicians may become covered entities through outside practice endeavors. Laboratories, whether hospital-based, office-based, or freestanding, receiving Federal monies through Medicare or Medicaid for covered laboratory tests are considered by HHS to be covered entities.

Based on searches of its databases, HHS believes that most physicians receive Federal financial assistance in their own right, making them covered entities subject to Section 1557 and the Nondiscrimination Rule. Physicians are not alone. Health insurers and other health care providers receiving Federal financial assistance also are bound by the Rule.

An additional word of note for covered physicians. Even though self-funded employer benefit plans generally are not covered entities (except to the extent their third party administrators are as covered health plans), employee health benefit programs provided by covered physicians generally are subject to the Rule. “Employee health benefit programs” is defined in the Rule which also establishes conditions under which such programs are covered, including when an employee health benefit program is provided by a covered entity “principally engaged in providing or administering health services. Covered physicians bear liability for Rule violations by their covered employee health benefit programs.

2. Administrative requirements of the Nondiscrimination Rule

The Nondiscrimination Rule imposes technical administrative obligations upon entities covered by it. Three such requirements are: 1) posting of notices; 2) establishing grievance procedures (if applicable); and 3) designating an employee contact person (if applicable). Specifically –

  • A covered entity employing 15 or more persons must designate at least one employee to coordinate its efforts to comply with and carry out the covered entity’s responsibilities under Section 1557 and the Nondiscrimination Rule. This requirement became effective on July 18, 2016, the effective date of the Rule.
  • A covered entity employing 15 or more persons must adopt grievance procedures incorporating due process standards and providing for prompt and equitable resolution of grievances alleging any discriminatory action prohibited by Section 1557 and the Nondiscrimination Rule. Appendix C to the Rule sets out a sample grievance procedure. This requirement became effective on July 18, 2016, the effective date of the Rule.
  • All covered entities, regardless of size, must meet the content and posting requirements of the Rule notifying individuals, among other things, that the covered entity does not discriminate on the basis of race, color, national origin, sex, age, or disability; that the covered entity, free-of-charge, provides auxiliary aids and services, as appropriate, for individuals with disabilities and language assistance for individuals with limited English proficiency (LEP); and how to file a grievance with the covered entity and a discrimination complaint with the OCR. Covered entities also must post taglines, or short statements, written in at least the top 15 languages spoken by LEP individuals in State, indicating the availability of language assistance for LEP individuals at no cost. Required posting points include 1) office locations; 2) the practice’s website; and 3) significant publications and communications of the medical practice, with small-sized publications and communications requiring only a nondiscrimination statement and language assistance taglines in the two most relevant languages spoken by LEP individuals in the State. Specifics regarding notices, taglines and posting requirements are found in the Rule.The notice and posting requirements become effective within 90 days (October 16, 2016) of July 18, 2016, the effective date of the Rule.

What are the 15 most prominent languages spoken by LEP individuals in Iowa? While the OCR does not appear to mandate a resource for answering this question, in its comments it references the U.S. Census Bureau’s 2009-13 American Community Survey which, for Iowa (https://www.census.gov/data/tables/2013/demo/2009-2013-lang-tables.html), shows the following top 15 languages spoken by LEP individuals in our State: 1) Spanish, 2) Chinese, 3) Vietnamese, 4) Serbo-Croatian, 5) German, 6) Arabic, 7) Laotian, 8)Korean, 9) Hindi, 10) French, 11) Pennsylvania Dutch, 12) Thai, 13) Tagalong, 14) Karen, and 15) Russian; the top 2 languages show as Spanish and Chinese.* The OCR has translated language assistance taglines in each of these languages. Consult this OCR site as well as Appendixes A and B of the Rule for sample nondiscrimination notice and nondiscrimination statement language. The OCR also has translated its sample nondiscrimination notice and statement; covered entities are required to post their nondiscrimination notices/statements only in English but are encouraged to post in other languages as well.

3.  Prohibited discriminatory practices and affirmative obligations of covered entities

The Nondiscrimination Rule prohibits discriminatory practices excluding an individual from participation in, or denying benefits for, or otherwise discriminating in a heath program or activity on the basis of race, color, national origin, sex, age or disability. The Rule then provides clarification on certain points. For instance, a covered entity may operate a health program or activity that is restricted to members of one sex if the covered entity can demonstrate an “exceedingly persuasive” justification that such limitation is “substantially related” to the achievement of an important health-related or scientific objective. Both the Rule and HHS’ comments on it provide direction in understanding its reach.

Requirements of particular interest to covered entity medical practices include the following —

  • Language assistance services for LEP persons. Medical practices covered by the Rule must take reasonable steps to provide meaningful access for LEP individuals receiving or likely to receive services from them. While not required, the Rule encourages implementation of a language access plan appropriate to each medical practice’s particular circumstances. LEP language assistance services must be provided free of charge, must be accurate and timely, and must protect the privacy and independence of the LEP individual. The Rule specifically defines “qualified interpreters” for LEP individuals, “qualified translator,” and “qualified bilingual/multilingual staff” and sets forth specific requirements for use of video remote interpreting services. A covered entity is prohibited from requiring an LEP individual to provide his or her own interpreter or from relying upon others (i.e., adult, minor child) accompanying the LEP individual to interpret or facilitate communication except in narrow circumstances permitted by the Rule. A LEP individual cannot be required to accept language assistance services.
  • Physician practices must review the definitions, prohibitions and requirements of the Rule regarding assistance to LEP individuals. Medical practices familiar with guidance statements re: interpreter services for LEP individuals issued by the OCR in 2003 may find they already are in substantial compliance with the Rule’s LEP language assistance requirements. No medical practice, however, should assume compliance absent review of this section of the Nondiscrimination Rule.
  • Accommodations for and effective communication with individuals with disabilities. The Nondiscrimination Rule requires covered entity medical practices to ensure that communications with individuals with disabilities are as effective as communications with others receiving services from them. “Qualified individual with a disability” and “disability” are defined by the Rule. By reference, the Rule imposes upon covered entities nondiscrimination regulatory standards already in place for public entities (28 C.F.R. Part 35) to meet the communication needs of the disabled. The Nondiscrimination Rule and its referenced communications standard also set forth requirements for facility accessibility and signage and accessibility by the disabled to electronic and information technology. Covered entities should be familiar with the “fundamental alteration” and “undue financial and administrative burdens” considerations of the Rule and its referenced standard which, in certain circumstances, may grant relief for medical practices in accommodating specific requests of disabled patients; covered entities bear the burden of showing they meet this standard.
  • Covered entity medical practices familiar with the requirements of the American with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act must, nonetheless, carefully review the requirements of this section of the Nondiscrimination Rule and its referenced communications standard. HHS explained in comments that the Rule imposes a higher ADA standard upon covered entities in meeting the communication needs of the disabled, particularly in requiring covered entities to give priority consideration to auxiliary aids or services requested by the disabled individual. Policies and procedures covered physicians may now have in place for accommodating the needs of the disabled may not be in accord with revised compliance expectations set forth in the Nondiscrimination Rule.
  • Covered entities must furnish appropriate auxiliary aids and services as necessary to afford individuals with disabilities and their companions an equal opportunity to participate in the covered entity’s services, programs and activities; the type of aids or assistive services will vary depending upon several factors set forth in the referenced communications standard. Importantly, the Rule and its reference standard now require that a covered entity, in determining what types of auxiliary aids and services are needed, must give primary consideration to what the disabled individual has requested. A covered entity shall not require a disabled individual to bring another individual along to interpret for him or her and shall not rely upon others (i.e., adult or minor child) accompanying the disabled individual except in narrow circumstances permitted by the referenced standard. The referenced standard also addresses video remote interpreting services, use of telecommunications, and telephone emergency services. “Auxiliary aids and services” and “qualified interpreter for an individual with a disability” are defined by the Nondiscrimination Rule.
  • Gender identity. The Nondiscrimination Rule’s prohibitions and requirements relating to discrimination based on sex give specific address to issues of gender identity. “Gender identity” is defined to mean “an individual’s sense of gender, which may be male, female, neither, or a combination of male and female, and which may be different than an individual’s sex assigned at birth.” A covered entity is required to treat individuals consistent with their gender identity. Services ordinarily or exclusively available to individuals of one sex may not be denied to a transgender individual based on the individual’s sex assigned at birth, gender identity, or recorded gender. Covered entity health insurers may not limit or restrict coverage for sex-specific health care services to a transgender individual based on the fact that the individual’s sex assigned at birth, gender identity, or gender otherwise recorded are different from the one to which such health services are ordinarily or exclusively available. A “transgender” individual is an individual whose gender identity is different from the sex assigned to that individual at birth.  Litigation challenging the gender identity requirements of the Rule has been filed by several parties in federal court.

The Nondiscrimination Rule is not without its complexities. The overview provided by this post has not addressed all of the Rule’s specific requirements. The OCR has developed a web page of resources to assist covered entities with compliance.

This post is informational only and is not meant to be, nor does it provide, legal advice.

*This article was updated on October 12, 2016, with new HHS information re-sequencing the 15 most prominent languages spoken by LEP individuals in Iowa.