Nondiscrimination in Health Programs and Activities, 37522-37703 [2024-08711]

Download as PDF 37522 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Office for Civil Rights Daniel Shieh, Associate Deputy Director, HHS Office for Civil Rights (202) 240–3110 or (800) 537–7697 (TDD), or via email at 1557@hhs.gov, for matters related to section 1557. DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services 42 CFR Parts 438, 440, 457, and 460 Office of the Secretary 45 CFR Parts 80, 84, 92, 147, 155, and 156 RIN 0945–AA17 Nondiscrimination in Health Programs and Activities Office for Civil Rights, Office of the Secretary, Department of Health and Human Services; Centers for Medicare & Medicaid Services, Department of Health and Human Services. ACTION: Final rule and interpretation. AGENCY: The Department of Health and Human Services (HHS or the Department) is issuing this final rule regarding section 1557 of the Affordable Care Act (ACA) (section 1557). Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities. Section 1557(c) of the ACA authorizes the Secretary of the Department to promulgate regulations to implement the nondiscrimination requirements of section 1557. The Department is also revising its interpretation regarding whether Medicare Part B constitutes Federal financial assistance for purposes of civil rights enforcement. Additionally, the Department is revising provisions prohibiting discrimination on the basis of sex in regulations issued by the Centers for Medicare & Medicaid Services (CMS) governing Medicaid and the Children’s Health Insurance Program (CHIP); Programs of AllInclusive Care for the Elderly (PACE); health insurance issuers and their officials, employees, agents, and representatives; States and the Exchanges carrying out Exchange requirements; agents, brokers, or webbrokers that assist with or facilitate enrollment of qualified individuals, qualified employers, or qualified employees; issuers providing essential health benefits (EHB); and qualified health plan issuers. DATES: Effective date: July 5, 2024. Applicability dates: Unless otherwise specified, the provisions of this final rule apply on or after July 5, 2024. See the SUPPLEMENTARY INFORMATION section for additional information. FOR FURTHER INFORMATION CONTACT: ddrumheller on DSK120RN23PROD with RULES4 SUMMARY: VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Centers for Medicare & Medicaid Services John Giles, (410) 786–5545, for matters related to Medicaid. Meg Barry, 410–786–1536, for matters related to CHIP. Timothy Roe, (410) 786–2006 for matters related to Programs of AllInclusive Care for the Elderly. Becca Bucchieri, (301) 492–4341 or Leigha Basini, (301) 492–4380, for matters related to 45 CFR 155.120, 155.220, 156.125, 156.200, and 156.1230. Lisa Cuozzo, (410) 786–1746, for matters related to 45 CFR 147.104. Hannah Katch, (202) 578–9581, for general questions related to CMS amendments. Assistance to Individuals With Disabilities in Reviewing the Rulemaking Record: Upon request, the Department will provide an accommodation or appropriate auxiliary aid or service to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for the final rule. To schedule an appointment for this type of accommodation or auxiliary aid, please call (202) 240–3110 or (800) 537–7697 (TDD) for assistance or email 1557@ hhs.gov. SUPPLEMENTARY INFORMATION: Table of Contents I. Background A. Regulatory History B. Overview of the Final Rule II. Provisions of the Proposed Rule and Analysis and Responses to Public Comments Subpart A—General Provisions Purpose and Effective Date (§ 92.1) Application (§ 92.2) Treatment of the Title IX Religious Exception Relationship to Other Laws (§ 92.3) Definitions (§ 92.4) Assurances Required (§ 92.5) Remedial Action and Voluntary Action (§ 92.6) Designation and Responsibilities of a Section 1557 Coordinator (§ 92.7) Policies and Procedures (§ 92.8) Training (§ 92.9) Notice of Nondiscrimination (§ 92.10) Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11) Data Collection Subpart B—Nondiscrimination Provisions Discrimination Prohibited (§ 92.101) PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 Subpart C—Specific Applications to Health Programs and Activities Meaningful Access for Individuals With Limited English Proficiency (§ 92.201) Effective Communication for Individuals With Disabilities (§ 92.202) Accessibility for Buildings and Facilities (§ 92.203) Accessibility of Information and Communication Technology for Individuals With Disabilities (§ 92.204) Requirement To Make Reasonable Modifications (§ 92.205) Equal Program Access on the Basis of Sex (§ 92.206) Nondiscrimination in Health Insurance Coverage and Other Health-Related Coverage (§ 92.207) Prohibition on Sex Discrimination Related to Marital, Parental, or Family Status (§ 92.208) Nondiscrimination on the Basis of Association (§ 92.209) Nondiscrimination in the Use of Patient Care Decision Support Tools (§ 92.210) Nondiscrimination in the Delivery of Health Programs and Activities Through Telehealth Services (§ 92.211) Subpart D—Procedures Enforcement Mechanisms (§ 92.301) Notification of Views Regarding Application of Federal Religious Freedom and Conscience Laws (§ 92.302) Procedures for Health Programs and Activities Conducted by Recipients and State Exchanges (§ 92.303) Procedures for Health Programs and Activities Administered by the Department (§ 92.304) III. Change in Interpretation—Medicare Part B Funding Meets the Definition of Federal Financial Assistance; Responses to Public Comment IV. CMS Amendments A. Medicaid and Children’s Health Insurance Program (CHIP) B. Programs of All-Inclusive Care for the Elderly (PACE) C. Insurance Exchanges and Group and Individual Health Insurance Markets 1. Comments and Responses to 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) 2. Health Insurance Exchanges a. Non-Interference With Federal Law and Nondiscrimination Standards (45 CFR 155.120) b. Federally-Facilitated Exchange Standards of Conduct (45 CFR 155.220) c. Essential Health Benefits Package: Prohibition on Discrimination (45 CFR 156.125) d. QHP Issuer Participation Standards (45 CFR 156.200) e. Direct Enrollment With the QHP Issuer in a Manner Considered To Be Through the Exchange (45 CFR 156.1230) 3. Prohibition of Discrimination—Group and Individual Health Insurance Markets Guaranteed Availability of Coverage (45 CFR 147.104) V. Executive Order 12866 and Related Executive Orders on Regulatory Review A. Regulatory Impact Analysis a. Baseline Conditions b. Costs of the Final Rule E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations c. Total Quantified Costs 3. Discussion of Benefits 4. Analysis of Regulatory Alternatives to the Final Rule B. Regulatory Flexibility Act—Final Small Entity Analysis 1. Entities That Will Be Affected a. Physicians b. Pharmacies c. Health Insurance Issuers d. Local Government Entities 2. Whether the Rule Will Have a Significant Economic Impact on Covered Small Entities C. Executive Order 12250 on Leadership and Coordination of Nondiscrimination Laws D. Paperwork Reduction Act 1. ICRs Regarding Assurances (§ 92.5) 2. ICRs Regarding Section 1557 Coordinator (§ 92.7) and Training (§ 92.9) 3. ICRs Regarding Notice of Nondiscrimination (§ 92.10) and Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11) E. Assessment of Federal Regulation and Policies on Families ddrumheller on DSK120RN23PROD with RULES4 I. Background Section 1557 of the Affordable Care Act (ACA) (section 1557), 42 U.S.C. 18116, prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in a health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, except where otherwise provided in title I of the ACA. Section 1557 also prohibits discrimination on the basis of race, color, national origin, sex, age, or disability under any program or activity that is administered by an executive agency, or any entity established under title I of the ACA or its amendments. The statute cites title VI of the Civil Rights Act of 1964 (title VI), 42 U.S.C. 2000d et seq., title IX of the Education Amendments of 1972 (title IX), 20 U.S.C. 1681 et seq., the Age Discrimination Act of 1975 (Age Act), 42 U.S.C. 6101 et seq., and section 504 of the Rehabilitation Act of 1973 (section 504), 29 U.S.C. 794, to identify the grounds of discrimination prohibited by section 1557. The entities to which section 1557 and this final rule apply (i.e., recipients of Federal financial assistance, the Department, and title I entities) are collectively referred to as ‘‘covered entities.’’ The statute further specifies that the enforcement mechanisms provided for and available under title VI, title IX, the Age Act, or section 504 shall apply for purposes of violations of section 1557, 42 U.S.C. 18116(a). The statute authorizes the Secretary of the U.S. Department of Health and Human Services (HHS or the Department) to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 promulgate implementing regulations for section 1557, 42 U.S.C. 18116(c). A. Regulatory History On August 1, 2013, the HHS Office for Civil Rights (OCR) published a Request for Information in the Federal Register, 78 FR 46558,1 followed by issuance of a notice of proposed rulemaking (NPRM) on September 8, 2015 (2015 NPRM), 80 FR 54171.2 OCR finalized the first section 1557 regulation on May 18, 2016 (2016 Rule), 81 FR 31375. On June 14, 2019, the Department published a new section 1557 NPRM (2019 NPRM), 84 FR 27846, proposing to rescind and replace large portions of the 2016 Rule.3 On June 12, 2020, OCR publicly posted its second section 1557 final rule (2020 Rule), which was published in the Federal Register on June 19, 2020, 85 FR 37160. The 2020 Rule remains in effect, save for the parts enjoined or set aside by courts, until the effective date of this final rule. In the meantime, entities that are subject to the 2020 Rule must continue to comply with the parts of the 2020 Rule that remain in effect. On January 5, 2022, the Department proposed to amend CMS regulations such that Exchanges, issuers, and agents and brokers would be prohibited from discriminating against consumers based on their sexual orientation or gender identity in the HHS Notice of Benefit and Payment Parameters for 2023 NPRM, 87 FR 584 (January 5, 2022). CMS did not finalize the amendments in the Notice of Benefit and Payment Parameters for the 2023 final rule, 87 FR 27208 (May 6, 2022); instead, CMS proposed to make the amendments to its regulations in forthcoming Departmental rulemaking. On July 25, 2022, OCR publicly posted the section 1557 NPRM associated with this rulemaking (2022 NPRM or Proposed Rule), which was published in the Federal Register on August 4, 2022, 87 FR 47824. OCR invited comment on the Proposed Rule by all interested parties. The comment period ended on October 3, 2022. In total we received 85,280 comments on 1 Responses are available for public inspection at https://www.regulations.gov/docket/HHS-OCR2013-0007/comments. 2 The 2015 NPRM received roughly 2,160 comments, which are available for public inspection at https://www.regulations.gov/docket/ HHS-OCR-2015-0006/comments. 3 The 2019 NPRM received roughly 198,845 comments, which are available for public inspection at https://www.regulations.gov/ document/HHS-OCR-2019-0007-0001. This count includes bundled submissions, including petitions and form letter campaigns, which were counted as individual comment submissions. PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 37523 the Proposed Rule.4 Comments came from a wide variety of stakeholders, including but not limited to: civil rights/ advocacy groups, including language access organizations, disability rights organizations, women’s advocacy organizations, and organizations serving lesbian, gay, bisexual, transgender, queer, or intersex (LGBTQI+) individuals; health care providers; consumer groups; religious organizations; academic and research institutions; reproductive health organizations; health plan organizations; health insurance issuers; State and local agencies; and tribal entities. Of the total comments, 79,126 were identified as being submitted by individuals. Of the 85,280 comments received, 70,337 (80 percent) were form letter copies associated with 30 distinct form letter campaigns. B. Overview of the Final Rule Section 1557 This preamble is divided into multiple sections: section II describes changes to the section 1557 regulation and contains four subparts: subpart A sets forth the rule’s general provisions; subpart B contains the rule’s nondiscrimination provisions; subpart C describes specific applications of the prohibition on discrimination to health programs and activities; and subpart D describes the procedures that apply to enforcement of the rule. Section III provides official notice of HHS’s change in interpretation that Medicare Part B meets the definition of ‘‘Federal financial assistance.’’ Section IV describes changes to CMS regulations. OCR has made some changes to the Proposed Rule’s provisions, based on the comments we received. Among the changes are the following: OCR modified proposed § 92.4 (Definitions) to include new definitions for telehealth, State, relay interpretation, and patient care decision support tools. OCR modified proposed § 92.201 (Meaningful access for individuals with limited English proficiency) to change ‘‘limited English proficient individual’’ to ‘‘individual with limited English proficiency’’ where applicable in this provision and elsewhere where the term is used. The text for proposed § 92.201(a) was updated to include ‘‘companions with limited English proficiency’’ for clarity and parity with the rule’s effective communication 4 This count includes bundled submissions, including petitions. The number of submission entries in the Federal Docket Management System is 75,254 submissions. Responses are available for public inspection at https://www.regulations.gov/ docket/HHS-OS-2022-0012. E:\FR\FM\06MYR4.SGM 06MYR4 37524 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations provision. OCR also modified proposed § 92.201(f) and proposed § 92.201(g) to address concerns that audio and video remote interpreting may not be appropriate to provide meaningful access in certain circumstances. OCR modified proposed § 92.206 (Equal program access on the basis of sex) to clarify a covered entity’s ability to raise legitimate and nondiscriminatory reasons for the denial of care under this provision, while stating that the basis for a denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination. OCR modified the text of proposed § 92.207 (Nondiscrimination in health insurance coverage and other healthrelated coverage), consistent with changes to § 92.206(c) to clarify that covered entities may raise a legitimate, nondiscriminatory reason for denials or limitations of health services in benefit design and in individual cases, while stating that the basis for a denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination. OCR revised proposed § 92.210 (Nondiscrimination in the use of clinical algorithms in decision-making) to change ‘‘clinical algorithms’’ and ‘‘clinical algorithms in decisionmaking’’ to ‘‘patient care decision support tools.’’ OCR further specified the scope of the application of this provision and the requirement that covered entities take reasonable steps to mitigate discrimination once made aware of the potential for discrimination resulting from use of these tools. OCR modified proposed § 92.302 (Notification of views regarding application of Federal religious freedom and conscience laws) to clarify the application of religious freedom and conscience laws, and aspects of the administrative process set forth in the provision, including that a recipient may request an assurance of an exemption under such laws, the availability of a temporary exemption, and the availability of an administrative appeal process. ddrumheller on DSK120RN23PROD with RULES4 CMS Amendments In response to comments, CMS is finalizing the proposed amendments to the CMS regulations with a revision to scope of sex discrimination to be consistent with section 1557’s regulatory text at § 92.101(a)(2). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 II. Provisions of the Proposed Rule and Analysis and Responses to Public Comments Subpart A—General Provisions Purpose and Effective Date (§ 92.1) In the 2022 NPRM, proposed § 92.1(a) explained that the purpose of 45 CFR part 92 is to implement section 1557, which prohibits discrimination in certain health programs and activities on the ‘‘ground[s] prohibited’’ under title VI, title IX, the Age Act, or section 504. Section 1557 adopts the grounds of these statutes and prohibits discrimination based on race, color, national origin, sex, age, or disability.5 Proposed § 92.1(b) provided that the effective date of the section 1557 implementing regulation shall be 60 days after the publication of a final rule in the Federal Register and provided a delayed implementation date (referred to as ‘‘applicability date’’ in this final rule) for provisions of this part that require changes to health insurance or group health plan benefit design. The comments and our responses regarding the purpose and effective date are set forth below. Comment: Several commenters noted that the regulatory purpose described in the 2022 NPRM strengthens nondiscrimination protections in health care, and appropriately aligns with section 1557’s statutory text and Congressional intent. Response: As commenters noted, the 2022 NPRM’s purpose is to prohibit discrimination in accordance with section 1557’s statutory text. The Proposed Rule mirrors the statutory text and clarifies that the purpose of this rule is to regulate health programs and activities conducted and funded by the Department and those of title I entities. Thus, we maintain the regulatory language for § 92.1(a) as proposed in the 2022 NPRM. Comment: One commenter observed that, in addition to title IX’s general prohibition of discrimination on the ground of ‘‘sex,’’ section 904 of title IX (20 U.S.C. 1684) also prohibits discrimination on the ground of blindness or severe vision impairment. Response: Both HHS’s and the Department of Education’s title IX regulations define title IX to exclude section 906. See 45 CFR 86.2(a); 34 CFR 106.2(a). While 20 U.S.C. 1684 prohibits certain forms of discrimination on the 5 See Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 945, 953 (9th Cir. 2020) (‘‘Section 1557(a) incorporates only the prohibited ‘ground[s]’ and ‘[t]he enforcement mechanisms provided for and available under’ the four civil rights statutes. A prohibited ‘ground’ for discrimination . . . is simply the protected classification at issue.’’). PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 ground of blindness or severe vision impairment, such conditions are disabilities and section 1557 prohibits discrimination on the basis of disability as it is the ‘‘ground’’ of discrimination prohibited by the statute’s reference to section 504. Accordingly, we decline to revise the regulatory text at § 92.1(a). Comment: OCR received many comments about the proposed 60-day effective date for requirements other than those related to health insurance or group health plan coverage benefit design. Commenters identified several tasks covered entities would need to accomplish to comply with the final rule requirements within the proposed 60 days, including updating existing policies and procedures; developing and reviewing new content; developing written communications with members and distributing written documents, including preparing additional mailings; and familiarizing themselves with new requirements and OCR-provided tools and resources. Most of these commenters expressed concern that covered entities would not be able to develop and implement the required policies and procedures (§ 92.8) and notices (§ 92.10, § 92.11), or complete the proposed training requirement (§ 92.9) within the allotted 60 days. A variety of commenters argued that the 60-day effective date for §§ 92.7 through 92.11 would be unreasonable for all covered entities, requesting that OCR consider allowing covered entities more time to come into compliance with the final rule. Commenters’ recommended compliance timeframes varied widely, from 180 days to three years following publication of the final rule in the Federal Register. One commenter asked that, for the first 18 to 24 months following publication of the final rule in the Federal Register, OCR’s section 1557 enforcement efforts, including complaint investigations, primarily focus on providing covered entities technical assistance with respect to their section 1557 obligations. Response: OCR appreciates comments regarding the effective date and commenters’ identification of factors influencing feasibility of a single effective date for all section 1557 requirements. We are maintaining the overall 60-day effective date related to the general prohibition on discrimination on the basis of race, color, national origin, sex, age, and disability. This is consistent with the approach taken with respect to the effective date of our previous E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations rulemakings.6 However, in light of the comments received, OCR has determined that it is reasonable to allow additional time for covered entities to comply with certain procedural requirements. The additional time will provide covered entities with the opportunity to properly designate a Section 1557 Coordinator and designee(s) (as applicable); develop and tailor to their respective organization’s policies and procedures; train relevant staff; and develop their required notices. For this reason, we are adopting phasedin applicability dates for certain provisions, as reflected in the chart at the end of this section. Comment: Some commenters requested that OCR allow for temporary safe harbors for covered entities’ compliance with certain aspects of the final rule. Specifically, commenters suggested that the final rule allow for an 18-month good faith safe harbor for covered entities currently operating in accordance with the 2016 Rule language access requirements, particularly the notice and tagline requirements at former 45 CFR 92.8. Response: OCR declines to grant safe harbors for covered entities that are or have been operating in accordance with the 2016 Rule’s notice and tagline requirements. Granting such a safe harbor would fail to recognize the importance of this final rule’s requirement. The Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (‘‘Notice of Availability’’) at § 92.11 requires notice of auxiliary aids and services in addition to language assistance services, which we have now revised to reflect a delayed applicability date of one year from the effective date. This revised applicability date reasonably allows enough time for covered entities to come into compliance with the Notice of Availability provision. Comment: Comments from organizational health insurance issuers generally supported the Proposed Rule’s delayed applicability date for provisions that require changes to health insurance or group health plan coverage benefits or benefit design, which proposed a delayed applicability date of the first day of the first plan year beginning on or after the year following the effective date of the final rule’s publication in the 6 The 2016 Rule’s effective date was 60 days after publication of the final rule, with the exception of the provisions on health insurance and benefit design, which went into effect the first day of the first plan year following the effective date. 81 FR 31375. The 2020 Rule’s effective date was 60 days after publication, with no exceptions. 85 FR 37160. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Federal Register.7 One commenter generally requested that OCR provide flexibility for plans depending on when the rule is finalized. Another commenter specifically requested that OCR consider allowing a temporary safe harbor compliance exception for group health plans and health insurance issuers of group health insurance coverage so that plan design changes for non-calendar-year plans may be implemented the first day of the new plan year occurring on or after January 1, 2024. Response: OCR is cognizant that health insurance issuers and group health plans develop their health insurance coverage and other healthrelated coverage benefit designs in advance of the plan year that the coverage is offered. Accordingly, we are including a delayed applicability date to the extent that the final rule’s provisions require changes to health insurance coverage or other health-related coverage, including group health plan coverage benefit design for health insurance coverage or other healthrelated coverage that is newly subject to certain provisions of § 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage). In such circumstances, the final rule’s applicability date is the first day of the first plan year beginning on or after January 1, 2025. This delayed applicability date applies equally to health insurance issuers and group health plans that are offering calendaryear and non-calendar-year plans. For example, a newly covered group health plan eligible for the delayed applicability date that offers a noncalendar year plan effective July 1, 2024, would have until the following plan year, effective July 1, 2025, to comply with the benefit design requirements, as July 1, 2025, would be the first day of the first plan year beginning on or after January 1, 2025. The 2020 Rule remains in effect until the effective date of this final rule. In the interim, covered entities that are subject to the 2020 Rule must continue to comply with the parts of the 2020 Rule that remain in effect. Notwithstanding the repeal of the former § 92.207 (2016 Rule), the 2020 Rule prohibits discrimination in health insurance coverage that receives Federal 7 The term ‘‘group health plan’’ is generally used to refer to a health benefit arrangement that is a distinct legal entity and can also be used to refer to the underlying health coverage or benefits. For ease of reference, this document uses the term ‘‘group health plan’’ when referring the plan as a distinct legal entity and uses the term ‘‘group health plan coverage’’ to refer to the underlying health coverage or benefits provided by the group health plan. PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 37525 financial assistance. Consistent with the 2020 Rule preamble, OCR interprets and enforces section 1557 under the 2020 Rule to prohibit discrimination in benefit design in health insurance coverage and other health-related coverage that receive Federal financial assistance.8 As such coverage is currently prohibited from having discriminatory benefit designs, the obligation to comply with this final rule’s § 92.207(b)(1) through (5) does not require a delayed applicability date. Therefore, we have revised the delayed applicability date for § 92.207(b)(1) through (5) under § 92.1(b) to reflect that the delayed applicability date is for health insurance coverage and other health-related coverage that are not already subject to this part as of the date of publication of this final rule. Because § 92.207(b)(6) (most integrated setting) describes a category of prohibited benefit design features that OCR is not explicitly enforcing under the 2020 Rule, OCR will not enforce this provision until the delayed applicability of the first day of the first plan year beginning on or after January 1, 2025. The delayed applicability date for all provisions of § 92.207 is in effect for covered health insurance coverage and other healthrelated coverage that are not subject to the 2020 Rule as of the date of publication of this final rule and are therefore newly subject to this final rule. Examples of health insurance coverage or other health-related coverage subject to the 2020 Rule (and thus the benefit design provisions under § 92.207(b)(1) through (5) as of July 5, 2024) include but are not limited to Medicare Advantage plans, Medicare Part D plans, Medicaid managed care plans, and qualified health plans.9 For complaints received prior to January 1, 2025 alleging discrimination related to benefit design, OCR will examine whether the health insurance coverage or other health-related coverage is subject to the 2020 Rule. If OCR determines the coverage was subject to 8 See 85 FR 37160 (stating the rule prohibits age discrimination, ‘‘including [in] health plan marketing and benefit design’’); id. at 37177 (stating that HHS ‘‘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’’); id. at 37201 (‘‘OCR will examine carefully any allegations of discrimination by health insurance issuers, including through benefit design.’’). 9 Qualified health plans are covered by the 2020 Rule as a program or activity administered by an entity established under title I of the ACA (i.e., an Exchange), pursuant to § 92.3(a)(3). See 85 FR 37174. Qualified health plans are also subject to the 2020 Rule to the extent they receive Federal financial assistance. Id. E:\FR\FM\06MYR4.SGM 06MYR4 37526 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations the 2020 Rule, the covered entity providing the coverage is responsible for complying with the specific benefit design provisions of § 92.207(b)(1) through (5) on July 5, 2024. In its review of such complaints, OCR will consider the nature of the challenged benefit design feature and whether it would have been prohibited under the 2020 Rule. For example, a Medicare Advantage plan that imposes additional cost-sharing for health services related to a particular disease but not for other diseases would be investigated as potentially discriminatory under the 2020 Rule and under this final rule as Section 1557 § 92.7 § 92.8 § 92.9 Requirement and provision Section 1557 Coordinator ...................... Policies and Procedures ........................ Training .................................................. § 92.10 Notice of nondiscrimination ................. § 92.11 Notice of availability of language assistance services and auxiliary aids and services. § 92.207(b)(1) through (5) Nondiscrimination in health insurance coverage and other healthrelated coverage. § 92.207(b)(6) Nondiscrimination in health insurance coverage and other health-related coverage. § 92.210(b), (c) Use of patient care decision support tools. Application (§ 92.2) ddrumheller on DSK120RN23PROD with RULES4 Proposed § 92.2 addressed the application of this regulation. OCR proposed in § 92.2(a) to apply the final rule, except as otherwise provided in the regulation, to: (1) every health program or activity, any part of which receives Federal financial assistance, directly or indirectly, from the Department; (2) every health program or activity administered by the Department; and (3) every program or activity administered by a title I entity. Title I entities include State Exchanges (including those on the Federal platform) and Federally-facilitated Exchanges, both of which were created under title I of the ACA.10 In § 92.2(b), we proposed that this regulation would not apply to an employer with regard to its employment practices, including the provision of employee health benefits. We noted that, although the 2016 and 2020 Rules 10 Section 1311 of the ACA (codified at 42 U.S.C. 18031) (establishing grants and requiring those grants to be used by States to create ‘‘American Health Benefit Exchanges’’) and section 1321(c) of the ACA (codified at 42 U.S.C. 18041(c)) (providing for the Secretary to establish an Exchange if a State elects not to establish an Exchange or fails to establish an Exchange under section 1311 of the ACA). VerDate Sep<11>2014 of its general 60-day effective date. However, if a Medicare Advantage plan contains a potentially discriminatory design feature related to integration, OCR would not investigate such an allegation under this final rule unless the alleged discrimination took place after the delayed applicability date of the first day of the first plan year beginning on or after January 1, 2025. Further, OCR clarifies that any covered entity offering health insurance coverage or other health-related coverage subject to the delayed applicability date for benefit design is still required to comply with all other 21:44 May 03, 2024 Jkt 262001 provisions of this final rule, as of the general effective dates and specific applicability dates set forth under § 92.1(b). Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions in § 92.1(a) as written and amending § 92.1(b), with modifications. In § 92.1(b), we have included a table that clearly provides the applicability date for each provision. It appears below: Date by which covered entities must comply Within 120 days of effective date. Within one year of effective date. Following a covered entity’s implementation of the policies and procedures required by § 92.8, and no later than one year of effective date. Within 120 days of effective date. Within one year of effective date. For health insurance coverage or other health-related coverage that was not subject to this part as of the date of publication of this rule, by the first day of the first plan year (in the individual market, policy year) beginning on or after January 1, 2025. By the first day of the first plan year (in the individual market, policy year) beginning on or after January 1, 2025. Within 300 days of effective date. applied to employment in very limited circumstances, OCR determined that the proposed approach would minimize confusion among individuals seeking relief under Federal Equal Employment Opportunity laws and would promote clarity regarding the filing and processing of employment discrimination complaints. We stated our belief that, as is the case with employment discrimination complaints generally, concerns regarding the provision of employee health benefits are best resolved by our Federal partners. In § 92.2(c), we proposed that if any provision of this regulation is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, it shall be severable from this part and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances. We invited comment on the effects of the proposed scope of application of the regulation, including the application of this part to recipients of Federal financial assistance from executive agencies other than the Department; the application to programs and activities of the Department and other executive PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 agencies; and the application to employment. The comments and our responses regarding § 92.2 are set forth below. Comment: Many commenters supported § 92.2(a), which commenters said would reinstate the scope of the section 1557 implementing regulation to that of the 2016 Rule and recognizes that section 1557 applies to Federal programs like Medicaid and Medicare, the State and Federal Marketplaces (referred to as ‘‘Exchanges’’ in this final rule) and the plans sold through them, as well as other commercial health plans if the issuer receives any form of Federal financial assistance. Commenters noted that ensuring section 1557 protections apply broadly to an array of entities and programs will ensure the greatest level of protection for individuals against discriminatory actions that may interfere with access to health care and health care coverage. Many commenters noted that the Proposed Rule was consistent with congressional intent. These commenters noted that Congress was clear in extending nondiscrimination protections to a broad array of health programs and activities, and that section 1557 was intended to build and expand upon existing civil rights laws, while E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations providing broad protection against discrimination in health care. These commenters further noted that Congress has repeatedly expressed that it intends civil rights laws to be broadly interpreted in order to effectuate their remedial purposes. Commenters also noted that the purpose of the ACA itself is to ensure broad access to and coverage of health care. Response: We agree that section 1557 protections apply broadly and that this final rule is the best reading of the statute regarding the scope of applicability; as such, the 2022 NPRM properly identified those entities that are covered under section 1557. Regarding plans sold through State and Federally-facilitated Exchanges, as discussed under the definition of ‘‘Federal financial assistance’’ at § 92.4, such plans are covered under this rule as a health program or activity when in receipt of Federal financial assistance, such as advance payments of the premium tax credit. This is consistent with the 2016 Rule. Further, as discussed under the definition of ‘‘health program or activity’’ at § 92.4, a health insurance issuer’s other commercial health plans are covered under this final rule as part of the issuer’s operations where the issuer is principally engaged in the provision or administration of any health projects, enterprises, ventures, or undertakings. For more information on the final rule’s application to all operations of a health insurance issuer that is so principally engaged, please see the discussion below under the definition of ‘‘health program or activity’’ at § 92.4. Comment: Some commenters requested that OCR clarify the extent to which a covered entity is required to oversee the section 1557 compliance of its vendors and subcontractors. For example, a health insurance issuer commented that an issuer should not be responsible for the discriminatory actions of a provider or facility with which the issuer has contracted for the provision of medical services. Another commenter requested clarification on when health insurance agents and brokers are subject to the rule, particularly when they are working under the auspices of a covered entity, such as an Exchange or a health insurance issuer. Other commenters suggested that subcontractors should be considered recipients by virtue of contracting with a recipient of Federal financial assistance. Response: Health programs or activities may comprise more than one recipient of Federal financial assistance. For example, a primary recipient (or ‘‘direct’’ recipient) is an entity that VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 accepts Federal financial assistance from a Federal agency. The direct recipient may then distribute the Federal financial assistance to a subrecipient (or ‘‘indirect’’ recipient) to carry out all or part of the health program or activity. Primary recipients and all subrecipients are covered and must comply with section 1557.11 Under general civil rights principles, both the primary recipient and subrecipient are responsible for complying with applicable civil rights laws.12 Therefore, if an entity receives Federal financial assistance—directly as a primary recipient or indirectly as a subrecipient—it would be a covered entity and responsible for complying with section 1557 and the part. While both direct and indirect recipients must comply with section 1557 independently, a direct recipient may not absolve itself of its obligations by contracting with another entity to provide services or assistance for which it received Federal financial assistance or using an agent to do so.13 Covered entities are responsible for the conduct of their subcontractors and cannot contract away their civil rights obligations through contractual arrangements with subcontractors. For example, section 1557 and the statutes referenced therein may cover a contractor that performs an essential function for the recipient, making the contractor itself a recipient. In Frazier v. Board of Trustees, 765 F.2d 1278, amended, 777 F.2d 329 (5th Cir. 1985), a case involving section 504, the court noted that the defendant hospital contracted out core medical functions, for which it received Federal financial assistance. The court ruled that this financial assistance to the hospital ‘‘would not have been [provided] at all were it not for [the contractor’s] performance as a de facto subdivision of [the hospital],’’ and thus the contractor qualified as a recipient for purposes of section 504, id. at 1289–90.14 11 For further discussion of this issue, see U.S. Dep’t of Justice, Title VI Legal Manual, sec. V.D.4. 12 Often, a recipient receives funds with the purpose and expectation that it will distribute the funds to one or more sub-grantees or indirect recipients. For example, in Moreno v. Consol. Rail Corp., 99 F.3d 782 (6th Cir. 1996) (en banc), the U.S. Department of Transportation provided funds to the State of Michigan for use in upgrading railroad crossings. The state, in turn, provided these funds to Conrail. The Sixth Circuit found that Conrail was a recipient of Federal financial assistance, noting ‘‘[i]t makes no difference, in our view, that the Federal funds of which Conrail is the recipient come to it through the State of Michigan rather than being paid to it by the United States directly.’’ Id. at 787. 13 U.S. Dep’t of Justice Title VI Legal Manual, Sec. V.D.5. 14 But see Rose v. Cahee, 727 F. Supp. 2d 728, 739 (E.D. Wis. 2010) (court declined to follow PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 37527 The obligation of health insurance agents and brokers as subcontractors is a fact-specific analysis depending on the contractual arrangement with a covered entity. If an Exchange or recipient, such as a health insurance issuer, contracts with an agent or broker to carry out responsibilities of the covered entity’s health program or activity and uses Federal financial assistance to pay the agent or broker, then the agent or broker is a subrecipient and thus independently subject to all the provisions of section 1557. If a contractor does not receive Federal financial assistance—either as a primary recipient or subrecipient—it is not a recipient of Federal financial assistance and not subject to section 1557. We note that agents and brokers under contract with an Exchange could also be covered by the final rule as a health program or activity administered by a title I entity under § 92.2(a)(3). Conversely, if the agent or broker is assisting the public with purchasing health insurance coverage without any contractual arrangement on behalf of an Exchange or recipient and is not otherwise receiving Federal financial assistance, then they would not be considered subrecipients or subcontractors subject to the rule. Comment: Some commenters stated that because the Federal Government now extensively subsidizes both medical care and health insurance coverage and other health-related coverage, the final rule will apply to practically all health care entities. They argued that because of this, it would be nearly impossible for medical professionals to work free of these regulations and, as a result, physicians and faith-based health care entities would effectively be barred from refusing to participate in pregnancy termination procedures. Response: It has long been established that when an entity receives Federal funds, conditions may be placed on the receipt of those funds.15 Not all providers receive Federal financial assistance; however, when they do, they must comply with applicable law. The Frazier, limiting coverage of the funding assistance nondiscrimination cover the contractor of a recipient requirement to those entities receiving the funds directly and that ‘‘are in a position to choose whether to do so’’). 15 The Supreme Court has generally treated these civil rights statutes as enacted based on Congress’s Spending Clause Power, which generally permits Congress to attach conditions to the receipt of Federal financial assistance. See Barnes v. Gorman, 536 U.S. 181, 189 n.3 (2002) (referring to the Rehabilitation Act as ‘‘Spending Clause legislation’’); id. at 185–86 (‘‘Title VI invokes Congress’s power under the Spending Clause, U.S. Const., Art. 1. § 8, cl. 1, to place conditions on the grant of federal funds.’’). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37528 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations rule, however, does not ban physicians and faith-based or other health care entities from refusing to participate in pregnancy termination procedures. On the contrary, the ACA itself provides that ‘‘[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A).16 In addition, the rule has been revised at § 92.3(c) to recognize that, ‘‘[i]nsofar as the application of any requirement under this part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required.’’ Further, in this final rule, the process regarding exemptions related to religious freedom and conscience protections has been clarified. See § 92.302. Comment: Some commenters supported the restoration of section 1557’s application to all health programs or activities administered by the Department under § 92.2(a)(2). These commenters noted that the 2020 Rule exempts from section 1557 most of the Department’s programs and activities by limiting the application to only those programs and activities established under title I of the ACA. These commenters opined that such an interpretation is contrary to the statutory text, design, and intent of section 1557 and the ACA generally. Other commenters noted that consistently applying section 1557 requirements throughout various programs, including the Department’s programs, creates continuity in the interpretation and implementation of nondiscrimination standards. However, some commenters stated that OCR did not provide adequate explanation as to why this change in application is necessary or appropriate. Response: For the reasons discussed in the 2022 NPRM, 87 FR 47838, applying this rule to all health programs and activities administered by the Department, not just those programs and activities established under title I of the Act, is the best reading of the statutory text of section 1557. The statutory language provides that section 1557’s discrimination prohibitions apply to 16 The application of this final rule to covered entities with conscience or religious freedom objections are discussed more fully below in §§ 92.3 (Relationship to other laws) and 92.302 (Notification of views regarding application of Federal religious freedom and conscience laws). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 ‘‘any program and activity that is administered by an executive agency or any entity established under this title.’’ 42 U.S.C. 18116(a). As discussed in the 2022 NPRM, the operative word, ‘‘or,’’ distinguishes programs and activities operated by an executive agency from those operated by a title I entity. 87 FR 47829. To the extent there is ambiguity in the interpretation, finalizing the rule as proposed better reflects the statutory language as well as Congress’s intent.17 The application of section 1557 to every health program or activity administered by the Department ensures that nondiscrimination standards are interpreted and applied as consistently and as broadly as possible and provides for application of nondiscrimination standards to the Department consistent with the entities to which it provides Federal financial assistance. Comment: Some commenters noted that under the most straightforward reading of section 1557, the regulatory framework should encompass all of the Department’s programs and activities, not just ‘‘health’’ programs and activities, and they suggested that the Department extend the regulation’s protections accordingly. Response: We appreciate commenters’ views on this issue. As we noted in the 2022 NPRM, OCR considered applying the rule to all programs and activities of the Department and sought comment on this issue. 87 FR 47838. Based on comments received and additional consideration, we are applying the final rule to the Department’s health programs and activities, rather than all the Department’s programs and activities, at this time. The Department may consider future rulemaking at a later date. For this final rule, however, OCR has determined that it is appropriate to apply the rule to the Department’s ‘‘health’’ programs and activities given that the ACA itself is principally related to health care and the entirety of this section 1557 rulemaking seeks to regulate ‘‘health’’ programs and activities. Comment: Commenters supported the rule’s application to programs and activities administered by title I entities under § 92.2(a)(3), stating it was 17 See, e.g., Griffin v. Breckenridge, 403 U.S. 88, 97 (1971) (civil rights statutes should be construed broadly); U.S. v. Price, 383 U.S. 787, 801 (1966) (same); see also N. Haven Bd. of Educ. v. Bell, 456 U.S. 512, 521 (1982) (‘‘[I]f we are to give Title IX the scope that its origins dictate, we must accord it a sweep as broad as its language.’’); S. Rep. No. 64, 100th Cong., 2d Sess. 5–7 (1988), reprinted in 1988 U.S.C.C.A.N. 3, 7–9 (statement of Sen. Humphrey stating that title VI should be interpreted as broadly as necessary to eradicate discriminatory practices in programs that Federal funds supported). PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 consistent with statutory text, Congressional intent, and the nondiscrimination purpose of section 1557 and the ACA. Response: Proposed § 92.2(a)(3) applied section 1557 to ‘‘every program or activity administered by a title I entity.’’ In the 2022 NPRM, 87 FR 47838, OCR explained that it was unnecessary to include the modifier ‘‘health’’ to programs or activities of a title I entity because title I entities already meet the definition of ‘‘health program or activity’’ as set forth under § 92.4. While this remains true, we have reevaluated the regulatory text of § 92.2(b)(3) and determined that it should be revised to add the modifier ‘‘health’’ to a title I entity’s ‘‘program or activity’’ for consistency with our interpretation that section 1557 applies to the Department’s ‘‘health’’ programs or activities, as discussed in the previous comment. This technical revision does not limit or alter the scope of § 92.2(b)(3)’s application to the programs or activities of a title I entity, as we articulated in the 2022 NPRM. 87 FR 47838. Comment: A few commenters opined that the rule should apply broadly to recipients of Federal financial assistance from any executive agency, not just the Department. These commenters noted that nothing in the statute suggests that Congress intended to limit the scope of section 1557’s application in such a way. Response: It is OCR’s longstanding position that section 1557’s discrimination prohibition is not limited to recipients of Federal financial assistance from the Department, but rather covers recipients’ health programs or activities regardless of the executive agency providing the funding.18 However, the final rule only applies to recipients of HHS funding, which is consistent with OCR’s delegation of authority to ‘‘develop and direct implementation of the requirements of Section 1557 . . . as applied to the Department and recipients of the Department’s funds.’’ 85 FR 37242 (emphasis added). Other Federal agencies possess section 1557 enforcement responsibility for the health programs and activities they fund and administer. Comment: Some commenters recommended that the Department provide a model for other agencies to craft their own, more inclusive, and 18 See U.S. Health & Hum. Servs., Off. for Civil Rts., Memo. from Jocelyn Samuels, Director, to Directors of Federal Offices for Civil Rights (Nov. 5, 2015), https://www.hhs.gov/sites/default/files/ 2015_11_04_fed_civil_rights_section_1557_memo_ 508.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations more protective rules for non-healthrelated programs in line with other applicable non-discrimination statutes. Response: OCR appreciates this recommendation and reiterates its desire to work with other agencies as necessary and appropriate. OCR only has authority to apply section 1557 to HHS and recipients of Departmental Federal financial assistance. This rule does not apply to programs and activities of other agencies and OCR is unable to regulate other agencies. Comment: A number of commenters disagreed with the non-application of the rule to employment practices under § 92.2(b). Commenters opined that the categorical exclusion of employers is inconsistent with section 1557’s statutory text and creates confusion. Some commenters noted that an agency to whom a complaint is referred may not adequately address claims of discrimination, including those of dependents. Commenters further noted that other employment discrimination laws, such as title VII of the Civil Rights Act of 1964 (title VII), 42 U.S.C. 2000e et seq., and the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. 621–634, require a claimant to file a complaint with a Federal agency before privately enforcing their rights. Some commenters requested that OCR clarify that this provision concerns only the processing of administrative complaints by OCR and that OCR’s decision not to apply this rule to employment practices does not preclude employees from vindicating their section 1557 rights in court. Other commenters supported proposed § 92.2(b) and noted it will help prevent wasteful duplication with other Federal laws and agencies that already cover unlawful employment discrimination. Response: The Supreme Court has recognized that section 1557 authorizes a private right of action.19 This final rule applies only to OCR’s administrative enforcement of section 1557. As discussed in the 2022 NPRM, 87 FR 47838, we believe that other Federal agencies are better equipped to review and adjudicate employee health benefits and allegations of employment discrimination given their expertise under the existing employment nondiscrimination statutes they enforce. Comment: Some commenters noted that employers are usually the sponsors of group health plans and raised concerns that OCR could therefor find 19 Cummings v. Premier Rehab Keller, P.L.L.C., 596 U.S. 212 (2022) (section 1557 provides a private right of action because the incorporated statutes do so). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 an employer liable under section 1557 for the employee benefits it provides. Response: This rule does not apply to employers or other plan sponsors with regard to their employment practices, including the provision of employee health benefits. As stated in the preamble to the Proposed Rule, 87 FR 47838, previous rules had limited application to employment. The 2016 Rule provided that employment practices included hiring, firing, promotions, or terms and conditions of employment, and therefore the 2016 Rule did not apply to those practices. However, the 2016 Rule applied to an employer with regard to its employee health benefit programs under certain circumstances as set forth under former § 92.208. The 2020 Rule, which repealed the 2016 Rule’s reference to employment practices and employee health benefit programs, reverted to enforcing the statutorily referenced nondiscrimination statutes through their existing regulations. As discussed above, the Proposed Rule proposed to exclude employment practices, which included the provision of employee health benefit programs. OCR also recognizes that other sponsors of group health plans undertake similar employment practices, such as the provision of employee health benefits. For example, a joint board of trustees for a multi-employer group health plan (also known as a Taft-Hartley plan) consists of representatives from employers and unions to sponsor a group health plan, and similarly engages in the provision of an employee health benefit like employers that sponsor a single-employer plan. To ensure consistent application of the rule to entities engaging in similar employment functions, the final rule revises § 92.2(b) to provide that the rule does not apply to any employer or other plan sponsor of a group health plan, including but not limited to, a board of trustees (or similar body), association or other group, with regard to employment practices, including the provision of employee health benefits. Group health plans, employers, and sponsors of group health plans are generally separate entities from one another that require a separate, factspecific analysis to determine whether each entity is subject to this rule. We discuss the relationship between plan sponsors, such as employers, joint boards of trustees or similar bodies, associations, and other groups that are plan sponsors of multi-employer TaftHartley plans or multiple-employer welfare arrangements (MEWAs), and group health plans in more detail in the discussion of group health plans in the PO 00000 Frm 00009 Fmt 4701 Sfmt 4700 37529 ‘‘health program or activity’’ definition discussion under § 92.4. Comment: Some commenters stated that ongoing litigation surrounding section 1557 and previous iterations of OCR’s section 1557 regulations, as well as agency course reversal on multiple occasions, has created confusion and compliance burden on covered entities. They urged the Department to reinforce the importance of severability under § 92.2(c) amongst the various regulatory provisions of the rule. Response: We appreciate concerns around ongoing litigation and agency reversal, and the resulting inconsistency in requirements. OCR has attempted to answer questions and reduce confusion raised by the previous versions of the rule. While this final rule is similar to the 2016 Rule, it provides greater clarity regarding section 1557’s statutory protections from discrimination along with various provisions to help alleviate burdens while providing certainty about covered entities’ obligations when compared to the 2016 and 2020 Rules. We believe the final rule enhances the benefits to individuals and minimizes the burdens on covered entities. OCR notes that § 92.2(c) provides that if any provision of this part is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, it shall be severable from this part and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances. For example, if a court were to invalidate the final rule’s Notice of availability of language assistance services provision (Notice of Availability) at § 92.11, all other provisions of the rule would remain in effect, as those provisions ‘‘could function sensibly without the stricken provision.’’ 20 Thus, if the rule’s Notice of Availability provision were invalidated, OCR would not enforce that provision. Or, for example, if a court were to invalidate the final rule’s Section 1557 Coordinator requirement at § 92.7, OCR would not require covered entities to fill this position as part of their compliance with this final rule, while otherwise enforcing other administrative requirements such as the Policies and procedures requirement at § 92.8 and the Notice of nondiscrimination requirement at § 92.10. Comment: Some commenters requested that the final rule restore the 2016 Rule clarification that any age 20 MD/DC/DE Broadcasters Ass’n v. F.C.C., 253 F.3d 732, 734 (D.C. Cir. 2001) (internal quotations omitted). E:\FR\FM\06MYR4.SGM 06MYR4 37530 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations distinctions exempt from the Age Act are also exempt from section 1557 enforcement. Response: OCR appreciates commenters’ request for clarity and directs commenters to § 92.101(b)(1) of this regulation, which adopts by reference the permissible uses of age located in the Department’s Age Act regulations at 45 CFR part 91 (subpart B). Comment: Some commenters argued that the Proposed Rule is inappropriate for the Indian Health Services (IHS) facilities because these are not open to members of the public but reserved for patients who are eligible beneficiaries as citizens of Tribal Nations, and as such, tribally operated IHS health facilities 21 should be exempt. These commenters stated that the 2022 NPRM failed to recognize the unique nature of the Indian Health Care System, which is the health care system for members of federally recognized Tribes in the United States. Commenters recommended that OCR acknowledge American Indian/Alaska Native (AI/AN) as a political classification, and not as a race-based classification. Commenters further opined that the 2022 NPRM failed to recognize the diplomatic, nation-to-nation relationship between Tribal Nations and the United States. Response: OCR appreciates these comments. Similar concerns were raised during the 2022 NPRM Tribal Consultation held on August 31, 2022, pursuant to Executive Order 13175. The IHS, an agency within the Department, is responsible for providing health services to members of federally recognized tribes in 37 states, arising out of the special government-togovernment relationship between the Federal Government and Indian tribes.22 Membership or eligibility in a federally recognized tribal entity is a political classification rather than a racial classification.23 Preferences based upon the unique relationship between ddrumheller on DSK120RN23PROD with RULES4 21 Titles I and V of the Indian Self-Determination and Education Assistance Act, Pub. L. 93–638, as amended, provide Tribes the option of exercising their right to self-determination by assuming control and management of programs previously administered by the Federal Government. Since 1992, the IHS has entered into agreements with tribes and tribal organizations to plan, conduct, and administer programs authorized under section 102 of the Act. Today, over sixty percent of the IHS appropriation is administered by tribes, primarily through self-determination contracts or selfgovernance compacts. U.S. Dep’t of Health & Hum. Servs., Indian Health Servs., IHS Profile, https:// www.ihs.gov/newsroom/factsheets/ihsprofile/. 22 U.S. Dep’t of Health & Hum. Servs., Indian Health Servs., About IHS, https://www.ihs.gov/ aboutihs/. 23 See Morton v. Mancari, 417 U.S. 535, 553 & n.24 (1974). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 the United States and federally recognized tribal entities are distinct from the forms of discrimination prohibited by Federal civil rights laws, which aim to protect all individuals on the basis of race, color, or national origin (including AI/AN individuals, regardless of political affiliation).24 The Department’s regulations implementing title VI provide that an individual shall not be deemed subjected to discrimination by reason of their exclusion from benefits limited by Federal law to individuals of a different race, color, or national origin. 45 CFR 80.3(d) (Indian Health and Cuban Refugee Services). IHS is mentioned in the Department’s title VI regulation as an example of such a program. Id. In § 92.101(b), the final rule adopts this provision by reference, and OCR will fully apply it, as well as other applicable exemptions or defenses that may exist under Federal law. Programs of the IHS are administered by IHS and tribes, including through self-determination contracts or selfgovernance compacts, and we intend to address any restrictions on application of the law to IHS programs in the context of individual complaints. Comment: Some commenters requested that OCR develop an online tool that would help covered entities determine whether the final rule applies either directly or indirectly to an organization or other health program or activity. Response: OCR provides various tools on our website to help covered entities determine their covered entity status and will continue to ascertain what tools would help the industry ensure widespread compliance. OCR notes that the Department’s Office of Grants operates a website that tracks obligated Department grant funds, https:// taggs.hhs.gov/, which allows the public to identify recipients of Department funding. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.2, with modification. We are revising § 92.2(a)(3) to add the modifier ‘‘health’’ to ‘‘program or activity administered by a title I entity.’’ We are also revising § 92.2(b) to state that the provisions of this part shall not apply to any 24 See Morton v. Mancari, 417 U.S. 535, 550 (1974) (‘‘[a] provision aimed at furthering Indian self-government by according an employment preference withing the [Bureau of Indian Affairs] for qualified members of the governed group can readily co-exist with a general rule prohibiting employment discrimination on the basis of race.’’). PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 employer ‘‘or other a plan sponsor of a group health plan, including but not limited to, a board of trustees (or similar body), association or other group,’’ with regard to its employment practices, including the provision of employee health benefits. Treatment of the Title IX Religious Exception In the 2022 NPRM, OCR proposed to not import the title IX religious exception into the section 1557 regulation. The title IX statute states that the nondiscrimination requirements ‘‘shall not apply to an educational institution which is controlled by a religious organization’’ to the extent that such application ‘‘would not be consistent with the religious tenets of such organization.’’ 20 U.S.C. 1681(a)(3), as amended Public Law 100– 259, section 3(b), Mar. 22, 1988, 102 Stat. 29. The title IX statutory definition of ‘‘program or activity’’ further limits the nondiscrimination requirements, in that they do not apply to ‘‘any operation of an entity which is controlled by a religious organization if the application of section 1681 of this title to such operation would not be consistent with the religious tenets of such organization.’’ Id. at 1687(4). In the 2022 NPRM, we said that under the most natural understanding of section 1557’s text, which bans discrimination ‘‘on the ground prohibited under . . . title IX,’’ the statutory term ‘‘ground prohibited’’ is best understood as incorporating only the bases on which discrimination is prohibited in the referenced statutes (i.e., ‘‘sex’’ in title IX). 87 FR 47839. Rather than import the title IX exception for ‘‘educational institution[s]’’ that are controlled by ‘‘religious organization[s],’’ OCR proposed that the best way to address religious objections to the application of this rule—and the way most consistent with section 1557’s statutory text and structure—would be through the process provided in proposed § 92.302. We sought comment on this approach. We particularly invited comments from covered entities controlled by or affiliated with religious organizations, providers employed by such entities, and people who receive health care from religiously affiliated medical providers. The comments and our responses regarding this request for comment are set forth below. Comment: Commenters provided mixed responses to OCR’s proposal not to import the title IX religious exception into this rule. Many commenters supported OCR’s statutory interpretation that section 1557 E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations incorporated the title IX statute only with respect to the ground of discrimination prohibited (sex) and its enforcement mechanisms (e.g., termination of Federal financial assistance and other means authorized by law). Several commenters stated that this reading is most consistent with the statutory structure, because if Congress intended for the title IX religious exception to apply, the statute would also require the importation of the other title IX exceptions, many of which are by their terms plainly inapplicable in the context of health care. Several commenters also stated that if Congress wanted to include the title IX religious exception, it could have either explicitly referenced or listed the exception in the section 1557 statutory text. Many commenters stated that any silence regarding the title IX exceptions was not an oversight by Congress, but an intentional decision. Many commenters contended that importing the title IX religious exception is contrary to the purpose of section 1557 and the goal of the ACA: to expand access to health care coverage. Additionally, many commenters said that importing the title IX religious exception is unnecessary given the numerous other Federal laws that allow religious organizations and providers to invoke a conscience or religious objection to providing certain kinds of medical services and care. Many other commenters disagreed with OCR’s interpretation, claiming that Congress intended to incorporate the entire title IX statutory scheme by including the signal ‘‘et seq.’’ Several commenters also argued that title IX’s prohibition on sex discrimination cannot be read separate and apart from all the exceptions included in the title IX statute, in which Congress authorized certain conduct—i.e., otherwise prohibited sex discrimination. Accordingly, several commenters maintained that it is arbitrary and capricious for OCR to rely upon title IX’s implementing regulations as a guide to prohibit discrimination on the basis of sex, such as those related to pregnancy-related conditions, or when distinguishing a marital, parental, and family status, while not importing the statute’s religious exception. A few commenters maintained that the differences between educational and health care institutions provide an unconvincing argument for nonimportation of the title IX religious exception because under the Title IX Common Rule of 2000 (Common Rule),25 title IX already applies to 25 Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 recipients of Federal financial assistance that provide health care. Many commenters also asserted that the court in Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), found that the decision not to import the title IX religious exception into the 2016 Rule, without explanation, was contrary to law. Several commenters also pointed to that court’s determination that the Department had previously ‘‘provide[d] that when cross-referencing the provisions of Title IX’s use of ‘student,’ the term ‘individual’ should be used in the healthcare context.’’ Id. at 691. Commenters asserted that this finding by the court undermines the Department’s claim that the title IX religious exception is specific to education and cannot be adopted more broadly in the health care context. Response: Title IX applies to ‘‘any education program or activity’’ operated by recipients of Federal financial assistance, and the statute creates an exception from coverage for the education programs and activities of ‘‘an educational institution which is controlled by a religious organization if the application of [title IX’s prohibition on sex discrimination in education programs and activities] would not be consistent with the religious tenets of such organization.’’ 20 U.S.C. 1681(a)(3). In addition, the Civil Rights Restoration Act of 1987 (CRRA) 26 statutorily defined ‘‘program or activity’’ for title IX to exclude from coverage ‘‘any operation of an entity which is controlled by a religious organization if the application of section 1681 of this title to such operation would not be consistent with the religious tenets of such organization.’’ 20 U.S.C. 1687(4). The preamble to the 2020 Rule stated that section 1557 ‘‘incorporates the statutory scope of Title IX, so it is appropriate for this rule to incorporate the Title IX statutory language concerning religious institutions.’’ 85 FR 37208. OCR notes that as an initial matter, the CRRA’s exclusion of any operation of religiously controlled entities from the application of title IX to the extent such operation is inconsistent with the religious tenets of the organization is not incorporated into section 1557. As we explain further in the discussion of ‘‘health program or activity,’’ section 1557 includes its own coverage provision that does not incorporate the CRRA’s definitions of ‘‘program or Financial Assistance, 65 FR 52857 (Aug. 30, 2000) (multiagency rulemaking adopting consistent title IX implementing regulations). 26 Public Law 100–259, 102 Stat. 28 (Mar. 22, 1988). PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 37531 activity.’’ Moreover, unlike title VI, section 504, and the Age Act,27 title IX modifies ‘‘program or activity’’ with ‘‘education,’’ 20 U.S.C. 1681(a), which limited title IX’s prohibition on sex discrimination to the ‘‘education’’ context; the definitions of ‘‘program or activity’’ under title VI, section 504, or the Age Act do not include any comparable exclusion for the operations of religiously controlled entities.28 Thus, the CRRA’s limitation to the application of certain operations of religious entities from title IX’s coverage applies only in the ‘‘education’’ context and is not part of the definition of ‘‘program or activity’’ as that term is used in civil rights statutes more generally. Further, it is inapplicable to the definition of ‘‘health program or activity’’ adopted in section 1557. As a result, the sole question is whether the exclusion in title IX, 20 U.S.C. 1681(a)(3), of certain applications of the statute to ‘‘educational institution[s] which [are] controlled by a religious organization’’ carries over into section 1557. Although title IX’s prohibition of sex discrimination applies to some healthrelated activities of covered education programs—such as programs training future health workers—the range of exceptions provided in section 1681(a) are plainly tied to the educational setting (e.g., the membership practices of social fraternities and sororities, YMCA, Girls Scouts, Boys Scouts; voluntary youth service organizations; father-son and mother-daughter activities; and beauty pageant-based scholarships, as well as educational admissions practices). All of these exceptions have little if any application to health programs and activities. Further, exceptions listed in that subsection include limitations regarding ‘‘educational institution[s],’’ ‘‘institution[s] of public higher education,’’ or ‘‘institution[s] of higher education.’’ 20 U.S.C. 1681(a)(1)–(9). 27 See 42 U.S.C. 2000d (title VI, prohibiting ‘‘discrimination under any program or activity receiving Federal financial assistance’’); 42 U.S.C. 6101 (the Age Act, prohibiting discrimination ‘‘in programs or activities receiving Federal financial assistance’’); 29 U.S.C. 794(a) (section 504 prohibiting ‘‘discrimination under 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’’). 28 S. Rep. No. 100–64, 100th Cong., 1st Sess. (1987), as reprinted in 1988 U.S.C.C.A.N. 3, 6, 1987 WL 61447, at *18 (discussing ‘‘education limitation in Title IX’’); see also id. at *20–*21 (‘‘[The CRRA] leaves the religious tenet exemption in Title IX intact and clarifies that the exemption is as broad as the Title IX coverage of education programs and activities.’’ (Emphasis added)). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37532 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations The language and subject matter of the exceptions suggest that Congress, in enacting title IX, did not intend those exceptions to define the statute’s basis of discrimination—what section 1557 calls the ‘‘ground prohibited’’—under title IX. Title IX prohibits discrimination on the basis of sex, so the ‘‘ground prohibited’’ under that statute is sex. Congress intended these exceptions to delineate certain contexts in which otherwise prohibited sex discrimination in the educational context would be excluded from the statute’s coverage. Congress could have chosen to draft section 1557 to incorporate additional elements from title IX and the other referenced civil rights statutes (e.g., those statutes’ applicability provisions), but did not do so, instead narrowly specifying that only the ‘‘ground[s] prohibited’’ are incorporated. OCR further notes that the inclusion of ‘‘et seq.’’ is simply part of an ordinary citation to the title IX statute. Congress frequently appends ‘‘et seq.’’ to statutory citations as a matter of course when legislation includes a generalized reference to a previously enacted statute.29 Including ‘‘et seq.’’ does not change the substantive meaning of section 1557, which incorporates only the grounds of prohibited discrimination and the enforcement mechanisms of each referenced statute. Further, section 1557 includes similar parenthetical citations with ‘‘et seq.’’ for the other referenced civil rights statutes in both 42 U.S.C. 18116(a) and (b). This underscores that Congress merely intended to provide the general, ordinary citation to the statutes being referenced, including title IX. Section 1557’s role as a health care statute further reinforces our reading of the statutory text and Congressional intent. Section 1557 was enacted as part of the ACA, in part, to expand access to health insurance and increase consumer protections. Title IX, as we have explained, relates specifically to education programs and activities. The title IX religious exception in that statute allows some entities to engage in certain conduct without requiring any consideration or mitigation of harm to third parties. If a similar standard were imported into this rule, it could undermine a key purpose of section 1557—ensuring access to health care. 29 See, e.g., 20 U.S.C. 1689(a)(1) (requesting a task force ‘‘provide pertinent information . . . with respect to campus sexual violence prevention, investigations, and responses, including the creation of consistent, public complaint processes for violations of title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et seq.)[.]’’); accord id. 1689(a)(8), (b)(1), (c). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 And as discussed below, unlike educational settings such as colleges and universities where there is more choice, individuals often have far fewer choices when accessing health care. In the federally funded health care context, the array of statutory conscience provisions enacted by Congress, as well as the general requirements of the First Amendment and the Religious Freedom Restoration Act (RFRA), provide a better fitting approach to addressing the relevant interests. This final rule has been revised to include regulatory text at § 92.3(c) recognizing that, insofar as the application of any rule requirement would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. Also, we have strengthened the process for raising religious freedom and conscience protections under this final rule at § 92.302. The fact that title IX and agency implementing regulations apply to some health programs and activities—those that are part of educational programs and activities 30—does not suggest that the exceptions set forth in the statute or implementing regulations apply to health programs and activities that are not a part of an educational program. Title IX’s limitation to a recipient’s education programs and activities has long been established.31 For example, the Common Rule (adopted by more than 20 Federal agencies) included the statute’s limitation that the prohibition on sex discrimination applied only to the educational components of a covered entity’s program.32 As we have explained, it is inconsistent with the text and purpose of section 1557, as well as the text and structure of title IX, to apply the title IX exceptions outside of the educational setting. Although the title IX regulations are relevant to informing what constitutes sex discrimination for purposes of this final rule—and we have looked to them for that purpose—that is because section 1557 incorporates the ‘‘ground prohibited’’ under title IX. But section 30 See, e.g., Doe v. Mercy Cath. Med. Ctr., 850 F.3d 545, 555 (3d Cir. 2017) (holding that a hospital’s residency program was an educational program or activity under title IX). 31 See O’Connor v. Davis, 126 F.3d 112, 117 (2d Cir. 1997), cert. denied, 522 U.S. 1114 (1998) (under title IX a program or activity must be ‘‘such that one could reasonably consider its mission to be, at least in part, educational’’); see also Jeldness v. Pearce, 30 F.3d 1220, 1224–25 (9th Cir. 1994); Klinger v. Dep’t of Corrs., 107 F.3d 609, 613–16 & n.5 (8th Cir. 1997); Roubideaux v. North Dakota Dep’t of Corrs. & Rehab., 570 F.3d 966, 976–79 (8th Cir. 2009). 32 Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance, 65 FR 52858, 52868 (Aug. 30, 2000). PO 00000 Frm 00012 Fmt 4701 Sfmt 4700 1557 does not incorporate any of the title IX exceptions. 87 FR 47839. OCR disagrees with the Franciscan Alliance decision vacating portions of the 2016 Rule, and in any event, that decision does not prohibit OCR from not importing the title IX religious exception in this final rule. The promulgation of this final rule constitutes new rulemaking, and OCR has provided a detailed explanation for the decision to not import the title IX religious exception and has taken important steps to address religious freedom and conscience protections beyond those in the 2016 Rule. These steps include revisions at § 92.3(c) to recognizes that, ‘‘[i]nsofar as the application of any requirement under this part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required,’’ adoption of a voluntary assurance of exemption process based on these protections at § 92.302, and the Department’s issuance of a final rule entitled Safeguarding the Rights of Conscience as Protected by Federal Statutes, 89 FR 2078 (Jan. 11, 2024). OCR notes that this final rule does not alter or eliminate a recipient’s ability to maintain, seek, claim, or assert a title IX religious exception under title IX if it meets the applicable criteria.33 And to the extent the recipient is entitled to a religious exception under title IX, OCR’s analysis will consider the entire statute, including title IX’s specific limitation to the context of educational programs and activities. Comment: Many commenters supported OCR’s proposal not to import the title IX religious exception, highlighting what they characterized as the dangers of doing so in the context of health care and the potential consequences on people’s access to health care it might have. For example, many commenters expressed concerns that providers would be able to deny essential health care services based on disapproval of a particular group, thereby putting at risk the health and well-being of already vulnerable individuals. Many commenters asserted that entities have invoked religious beliefs to deny individuals access to health care and coverage for a broad range of health care services. Commenters said that in urgent or emergency care situations, individuals may be unable to identify or use the services of an alternate provider when an institution withholds care based on religious tenets, even when the 33 20 E:\FR\FM\06MYR4.SGM U.S.C. 1681(a)(3); 45 CFR 86.12. 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations individual is aware of such objections by an institution. Many commenters highlighted the difference between education and health care. Multiple commenters stated that unlike certain health care settings, many parents have the choice to send their children to religious schools, whereas individuals often lack meaningful choices when seeking a health care provider, particularly for time-sensitive care. For example, numerous commenters stated that choice is especially limited in rural areas, and some patients may only have local access to religiously affiliated providers. Commenters worried that importing the title IX religious exception into this rule could have dire implications for health outcomes. Response: As previously noted, this rule’s application to the health care context is central to OCR’s interpretation of section 1557. OCR appreciates that religiously affiliated hospitals and health care facilities play an important role in the health care system and recognizes the critical patient care needs they provide, including in underserved communities and areas which otherwise lack access to quality health care. At the same time, OCR believes that Congress chose not to import the title IX religious exception into section 1557 due to concerns about the impact such an action could have on access to health care. The importation of the title IX religious exception would raise unique concerns in the health care context that are not typically present in education programs and activities. As OCR discussed in the 2022 NPRM, health care settings differ from educational settings with respect to both the ability of affected parties to choose (or avoid) certain religiously affiliated health care institutions and the urgency of the need for services provided by the covered entities. 87 FR 47840. While students and families normally make a deliberate choice to attend a religious educational institution, in many cases specifically due to its religious character, individuals seeking health care are far more likely to be driven by other considerations such as availability, urgency, geography, insurance coverage, and other factors unrelated to whether the provider is controlled by or affiliated with a religious organization. See id. Rather than importing the title IX religious exception into section 1557, where Congress referenced only the ‘‘ground prohibited under’’ and the ‘‘enforcement mechanisms provided’’ for in title IX, the process set forth in § 92.302 respects religious freedom and conscience protections. As this final rule makes VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 clear at § 92.3(c), insofar as the application of any requirement under this rule would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. Under § 92.302, recipients may rely on these protections or seek assurance of these protections from OCR, if they wish. In this process, OCR will comply with the applicable legal standards of the governing statutes, which include the protections in the ACA itself, 42 U.S.C. 18023; the Church, 42 U.S.C. 300a–7, Coats-Snowe, 42 U.S.C. 238n, and Weldon Amendments, e.g., Consolidated Appropriations Act, 2024, Public Law 118–47, div. H, tit. V, sec. 507(d)(1), 138 Stat. 460, 703 (Mar. 23, 2024); the generally applicable requirements of RFRA, 42 U.S.C. 2000bb–1; and other applicable Federal laws. Comment: Many commenters who supported OCR’s proposal not to import the title IX religious exception raised concerns that its importation could discourage individuals from seeking necessary medical care. Many commenters also discussed various State laws recently enacted to further expand religious exemptions from health care requirements and how such laws have specifically affected communities with limited access to care. These commenters argued that the effects of these laws further support OCR’s goal of ensuring patients have broad access to nondiscrimination protections. Response: OCR appreciates commenters’ concerns regarding the potential harms to individuals with limited or restricted access to health care. OCR appreciates that many religiously affiliated hospitals and providers are providing vital services in areas where people are in the most need and are often motivated by their faith to provide this important care. However, OCR maintains that Congress did not choose to import the title IX religious exception into section 1557. Importing the title IX exception would be inconsistent with the text, structure, and purpose of both title IX and section 1557. Rather, Congress has enacted protections for conscience in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments, among others; the generally applicable requirements of RFRA, and other applicable Federal laws as the means to protect religious freedom and conscience in this context. We are committed to affording full effect to Congress’s protections of conscience and religion, as detailed in § 92.302 and the Department’s issuance of its final rule, Safeguarding the Rights of PO 00000 Frm 00013 Fmt 4701 Sfmt 4700 37533 Conscience as Protected by Federal Statutes. 89 FR 2078. Comment: Multiple commenters opposed OCR’s proposal not to import the title IX religious exception, stating that doing so would harm providers and hospital systems by compelling covered entities to provide abortion or other care that is contrary to their religious beliefs or that they believe will be harmful to their patients. Various commenters said that compelling such actions would turn many individuals and institutions of faith away from the medical profession. Several commenters expressed confusion about available religious exceptions and how certain rule requirements would apply to religiously affiliated covered entities. These commenters said that including the title IX religious exception would clarify protections for religious entities. Some commenters expressed concern that this regulation demonstrated OCR’s intent to use section 1557 to force religious hospitals to dispense medication and perform procedures that are prohibited by their faith. Several commenters objected to the inclusion of cites in the 2022 NPRM that explain the increased prevalence of religiously affiliated health care systems and opined that this demonstrated hostility toward faith-based providers. According to these commenters, including these cites prejudices OCR’s review of providers’ religious exemption requests. Instead, these commenters urged OCR to make clear that providers will not be compelled to perform, cover, or promote procedures or medical interventions to which they have moral or religious objections. Response: OCR appreciates commenters’ concerns and respects their opposition to the proposal not to import the title IX religious exception. OCR reiterates, consistent with the 2022 NPRM, that this final rule does not promote any particular medical treatment, require provision of particular procedures, mandate coverage of any particular care, or set any standard of care; rather, the final rule implements the nondiscrimination requirements of section 1557. See 87 FR 47867–68. The full protections of all Federal religious freedom and conscience laws continue to apply. Additionally, OCR makes clear that the decision not to import the title IX religious exception does not compel any individual provider or covered entity with religious or conscience-based objections to provide abortion or any other care to the extent doing so would conflict with a sincerely-held belief. The ACA itself provides that ‘‘[n]othing in this Act shall be construed to have any E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37534 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A). As discussed further below, section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. A covered entity does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure. In addition, any recipient that believes that it is exempt from certain provisions of this rule due to the application of a Federal conscience or religious freedom law may rely on those provisions, as referenced in § 92.3(c), or choose to seek assurance of the applications of those provisions pursuant to the process provided in § 92.302. In light of § 92.302 and 42 U.S.C. 18023(c)(2)(A) (section 1303 of the ACA), OCR maintains that although some recipient providers and hospitals may decline to participate in federally funded health programs as a result of this rule, most will choose to continue to participate. To avoid confusion, we have further clarified the process for seeking assurance of an exemption based on religious freedom and conscience laws at § 92.302 and are committed to making available trainings and other resources to assist covered entities in understanding their obligations under section 1557 and the process by which they may seek assurance of an exemption under § 92.302. Again, OCR appreciates that religiously affiliated hospitals and health care facilities play an important role in the health care system and recognizes the critical patient care needs they provide, including in underserved communities and areas which otherwise lack access to quality health care. Any discussion relating to the prevalence of religiously affiliated care is relevant for OCR to evaluate access issues that patients seeking certain procedures or care could potentially face, although OCR does not assume that all religiously affiliated entities’ refusals to provide certain forms of care would result in such access issues. As previously stated, the 2022 NPRM provided factual findings with respect to health care accessibility in the United States based upon health care capacity of providers, population demands, and geographic VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 limitations. 87 FR 47840. A detailed discussion of these considerations can be found in the Regulatory Impact Analysis (RIA). Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the rule as proposed, without importing the title IX religious exception. Relationship to Other Laws (§ 92.3) In § 92.3, we provided an explanation of the relationship of the proposed regulation to existing laws. Proposed § 92.3(a) provided that neither section 1557 nor this part shall be interpreted to apply lesser standards for the protection of individuals from discrimination than the standards under title VI, title IX, section 504, the Age Act, or the regulations issued pursuant to those laws. In § 92.3(b), we proposed that nothing in this part shall be interpreted to invalidate or limit the existing rights, remedies, procedures, or legal standards available under the Federal civil rights laws cited in 42 U.S.C. 18116(b) (title VI, title VII, title IX, section 504, and the Age Act), consistent with 42 U.S.C. 18116(b). In § 92.3(c), we proposed that nothing in this part shall be interpreted to invalidate or limit the existing rights, remedies, procedures, or legal standards available under Federal religious freedom and conscience laws. Though not specifically referenced in the Proposed Rule, these include the protections in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments; the generally applicable requirements of RFRA; and other applicable Federal laws. The comments and our responses to this provision are set forth below. Comment: Commenters expressed a mix of viewpoints regarding the ‘‘lesser standard’’ language included in proposed § 92.3(a), concerning civil rights statutes referenced in section 1557. Some commenters recommended removing the ‘‘lesser standard’’ language because it is not included in the section 1557 statute. Commenters stated that this language ignores Congress’s decision to employ a particular standard to each of the civil rights laws incorporated, such that it would allow OCR to redefine bases for discrimination and improperly preempt State law affecting such categories. Response: In this final rule, OCR seeks to give all laws their fullest possible effect. OCR appreciates these comments but declines to remove the ‘‘lesser standard’’ language included in PO 00000 Frm 00014 Fmt 4701 Sfmt 4700 § 92.3(a). As the 2016 Rule recognized, 81 FR 31381, this interpretation is consistent with a natural reading of section 1557’s statutory text that explicitly states that section 1557 shall not be construed to ‘‘invalidate or limit the rights, remedies, procedures, or legal standards’’ of the referenced statutes (and title VII) ‘‘or to supersede State laws that provide additional protections against discrimination,’’ 42 U.S.C. 18116(b). OCR accordingly reaffirms that the civil rights laws referenced in section 1557 establish the grounds of prohibited discrimination, and nothing in this final rule is intended to provide lesser protections than those found under title VI, title IX, section 504, or the Age Act, or their implementing regulations. Comment: Several commenters supported the inclusion of the ‘‘lesser standard’’ language in § 92.3(a) but suggested that § 92.3(c), concerning Federal religious freedom and conscience laws, is unnecessary and, if included without any limitations, undermines this ‘‘lesser standard’’ language of § 92.3(a) and could encourage discrimination. Response: We decline to remove § 92.3(c), concerning Federal religious freedom and conscience laws. These laws remain applicable and removing the language runs contrary to the Department and OCR’s stated commitment to protect the rights of individuals and entities under Federal conscience or religion freedom laws. Indeed, the ACA itself contains a similar provision at 42 U.S.C. 18023(c)(2)(A)(i), which provides that ‘‘[n]othing in this Act shall be construed to have any effect on Federal laws regarding—conscience protection[.]’’ As discussed later in this section, we have revised § 92.3(c) to provide additional specificity regarding the application of Federal religious freedom and conscience protections. Comment: Some commenters suggested that OCR clarify that section 1557 does not limit the rights of individuals to any of the protections afforded under title VI, title IX, section 504, or the Age Act. These commenters suggested that section 1557 is a distinct law and, while it is intended to work in tandem with other civil rights laws, section 1557 stands on its own. Several other commenters requested that the final rule include language that clarifies that administrative exhaustion is not required to bring any claim under section 1557 in Federal court, where for example a claim may involve age as one basis of discrimination among several (e.g., alleging discrimination on the bases of age, sex, and disability at the same time) but the Age Act has a E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations statutory requirement that claimants first exhaust their administrative remedies. Response: Section 92.3(b) clearly states that this part does not limit or invalidate the rights, remedies, procedures, or legal standards under the statutes referenced (i.e., title VI, title VII, title IX, section 504, and the Age Act), consistent with the statutory text of section 1557 at 42 U.S.C. 18116(b). In addition to incorporating the ‘‘ground[s] prohibited’’ by these other statutes, section 1557 incorporates the ‘‘enforcement mechanisms’’ of the statutes. 42 U.S.C. 18116(a). Though the section 1557 rule is informed by the title VI, title IX, Age Act, and section 504 implementing regulations, section 1557 provides an independent basis for regulation of discrimination in covered health programs and activities that is distinct from these statutes. Section 1557’s nondiscrimination requirements do not in any way limit or impact the interpretation of those statutes. See id. at 18116(b). Section 1557 is a distinct civil rights authority. Courts have long recognized that section 1557 authorizes a private right of action under any of the bases for discrimination. While we appreciate concerns raised by commenters regarding the heightened risks associated with unnecessary delays in the context of health care, we decline to revise regulatory text to adopt a stance on the appropriate standards that apply to private litigants. This is an issue appropriately addressed by the Federal judicial branch and not via agency rulemaking. Comments and responses regarding OCR procedures for conducting its own administrative enforcement are provided in §§ 92.303 (Procedures for health programs and activities conducted by recipients and State Exchanges) and 92.304 (Procedures for health programs and activities administered by the Department). Comment: Many commenters raised concerns about the potential conflicts of State and Federal laws. Some commenters expressed that any conflict between State and Federal law or policy would be inconsistent with the principles of federalism. Some commenters had specific concerns regarding the final rule’s application to State laws that prohibit transgender patients from receiving certain medically necessary gender-affirming care or those that protect religious freedom and conscience. Other commenters suggested that OCR should include a subsection in the final rule that addresses the interaction between section 1557 and State or local laws, VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 making explicit that a State may set more rigorous standards for nondiscrimination in the provision of health care but not lesser protections than those of section 1557. To the extent State or local law offers lesser protections these commenters recommended OCR make explicit that such laws are preempted by Federal law, consistent with the general preemption standard for title I of the ACA, codified at 42 U.S.C. 18041(d). Response: OCR appreciates these comments regarding the rule’s interaction with State and other Federal laws. We agree with commenters who observed that Federal laws, as a general matter, preempt conflicting State laws. See U.S. Const. art. 6, cl. 2. We also note that title I of the ACA itself contains a preemption provision, which courts have interpreted to preempt State laws that serve as an obstacle to or frustrate the purpose of the ACA.34 See 42 U.S.C. 18041(d). Accordingly, we decline to alter the regulation to include any additional language under this provision addressing preemption. OCR recognizes that some States may have laws impacting health programs and activities that are contrary to the final rule’s nondiscrimination protections, and as discussed later regarding § 92.206 (Equal program access on the basis of sex), section 1557 preempts those laws, though OCR will consider the specific facts of each case and any other relevant factors in determining whether the recipient has a legitimate, nondiscriminatory reason for taking actions that conflict with section 1557. OCR is adding § 92.3(d) regarding State and local laws to provide: ‘‘Nothing in this part shall be construed to supersede State or local laws that provide additional protections against discrimination on any basis described in § 92.1.’’ Comment: Commenters recommended that OCR include in the final rule clarification that the Emergency Medical Treatment and Labor Act (EMTALA) protects emergency care for pregnancy and related conditions, including termination of pregnancy. 34 See St. Louis Effort for AIDS v. Huff, 782 F.3d 1016, 1021, 1024 (8th Cir. 2015) (partially affirming lower court preliminary injunction because Missouri law ‘‘frustrates Congress’ purpose’’ and ‘‘pose[s] an obstacle to the accomplishment and execution of the full purposes and objectives of Congress’’); Coons v. Lew, 762 F.3d 891 (9th Cir. 2014), as amended, (Sept. 2, 2014) (‘‘The Affordable Care Act presents a classic case of preemption by implication because the Arizona Act ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’ ’’), quoting Gade v. Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88, 98 (1992). PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 37535 Response: This rule concerns section 1557 and does not purport to interpret or enforce EMTALA—indeed, OCR does not enforce EMTALA, nor does EMTALA limit or expand the civil rights protections found in section 1557. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.3, with modifications. We are revising § 92.3(c) to provide that, insofar as the application of any requirement under the part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. For example, 42 U.S.C. 18023 provides (among other things) that, nothing in section 1557 shall be construed to have any effect on Federal laws regarding conscience protection; willingness or refusal to provide abortion; and discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion. We are also adding a new § 92.3(d) to provide that nothing in the part shall be construed to supersede State or local laws that provide additional protections against discrimination on any basis described in § 92.1. Definitions (§ 92.4) In § 92.4 of the Proposed Rule, we set out proposed definitions of various terms. The comments and our responses regarding § 92.4 are set forth below. Auxiliary aids and services. The term auxiliary aids and services was defined in the 2016 Rule and has not been changed substantively. The proposed definition is consistent with the Americans with Disabilities Act (ADA) regulations at 28 CFR 35.104 and 36.303(b) and provides examples of auxiliary aids and services. Comment: Commenters generally supported the definition of ‘‘auxiliary aids and services.’’ Some commenters recommended that the final rule clarify that ‘‘similar services and actions’’ are available for all individuals with disabilities, not just for individuals who are deaf or hard of hearing and individuals who are blind or have low vision. Response: OCR appreciates this comment; however, effective communication requirements are addressed in § 92.202(a). As § 92.4 is simply providing a definition for the term auxiliary aids and services, which is used in § 92.202(b), we do not believe E:\FR\FM\06MYR4.SGM 06MYR4 37536 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations it is appropriate to adopt language suggested by the commenters. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘auxiliary aids and services’’ as proposed in § 92.4, with one technical correction in paragraph (1) to provide the correct cite for the title II definition of ‘‘qualified interpreter’’ by striking ‘‘36.303(b)’’ and replacing it with ‘‘36.104.’’ Companion. We proposed to define the ‘‘companion’’ to mean ‘‘family member, friend, or associate of an individual seeking access to a service, program, or activity of a covered entity, who along with such individual, is an appropriate person with whom a covered entity should communicate.’’ This term appeared in the 2016 Rule and has not been changed substantively. Comment: Many commenters support the inclusion of the term ‘‘companion’’ in the definitions section of the regulation, and some highlighted that companions for persons with certain disabilities, such as brain injuries and other conditions with cognitive effects, as well as individuals with sensory disabilities, are critical to effective communication of very sensitive and important medical information. Some commenters suggested that OCR clarify that such companions should be selected by the patient and not the provider. Response: OCR appreciates the commenters’ support for inclusion of this definition. OCR declines to add additional language, as the definition of ‘‘companion’’ in this rule is consistent with the definition from 28 CFR 35.160(a)(2) under title II of the ADA, and with the proposed definition in OCR’s notice of proposed rulemaking for section 504 at proposed 45 CFR 84.10.35 We agree that the individual with a disability should be the one to determine who shall serve as their companion absent any concerns of conflict of interest or suspected abuse. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘companion’’ as proposed in § 92.4, without modification. Federal financial assistance. We proposed to define the term ‘‘Federal financial assistance’’ to include grants, 35 See 88 FR 63392, 63465 (Sept. 14, 2023) (proposing to define ‘‘companion’’ consistent with ADA title II regulations). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 loans, and other types of assistance from the Federal Government, consistent with the definition of the term in the section 504 and the Age Act implementing regulations at 45 CFR 84.3(h) and 91.4, respectively. We also proposed to specifically include credits, subsidies, and contracts of insurance, in accordance with the statutory language of section 1557. 42 U.S.C. 18116(a). Consistent with the 2016 Rule, we proposed including a clause to clarify that Federal financial assistance includes Federal financial assistance that the Department plays a role in providing or administering. Comment: Many commenters supported the inclusion of credits, subsidies, contracts of insurance, and grants and loans in this definition. Some commenters recommended expanding the definition of ‘‘Federal financial assistance’’ to include Federal disaster relief loans and pandemic relief grants and loans. Response: The definition of ‘‘Federal financial assistance’’ includes funds provided by the Federal Government, including grants and loans, along with Federal financial assistance that the Department plays a role in providing or administering. Because the types of funds raised by the commenters already fall under the longstanding definition of ‘‘Federal financial assistance,’’ and the inclusion of specific types of Federal financial assistance would cause unnecessary confusion and may be read as unintentionally limiting the scope of what constitutes Federal financial assistance, we decline to revise the definition. Comment: Some commenters requested that OCR clarify whether taxexempt status is considered Federal financial assistance. Response: OCR appreciates commenters’ request for clarity. Generally, tax benefits, tax exemptions, tax deductions, and most tax credits are not included in the statutory or regulatory definitions of Federal financial assistance. See, e.g., 42 U.S.C. 2000d–1 (title VI); 28 CFR. 42.102(c) (Department of Justice Title VI Regulation). Most courts that have considered the issue have concluded that typical tax benefits are not Federal financial assistance because they are not contractual in nature.36 Comment: Many commenters supported the definition’s inclusion of Federal financial assistance that ‘‘the 36 See, e.g., Paralyzed Veterans of Am. v. Civil Aeronautics Bd., 752 F.2d 694, 708–09 (D.C. Cir. 1985); Johnny’s Icehouse, Inca v. Amateur Hockey Ass’n of Ill., Inc., 134 F. Supp. 2d 965, 971–7297172 (N.D. Ill. 2001); Chaplin v. Consol. Edison Co., 628 F. Supp. 143, 145–46 (S.D.N.Y. 1986). PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 Department plays a role in providing or administering, including advance payments of the premium tax credit and cost-sharing reduction payments.’’ 37 A commenter expressed support for this definition’s application to funds extended via programs operated by States under section 1332 State Innovation Waivers, 42 U.S.C. 18052, which could include funds extended to issuers receiving reimbursement through reinsurance programs and entities participating in programs intended to modify or replace Exchanges that would otherwise be within the scope of section 1557. Response: OCR appreciates these comments and believes it is important to explicitly state in regulatory text that funds that the Department plays a role in providing or administering constitute Federal financial assistance. As explained in the Proposed Rule, 87 FR 47843, this includes funds the Department administers with the Department of the Treasury under the ACA, including advance payments of the premium tax credit, cost-sharing reductions,38 and pass-through funding available to States with approved section 1332 waivers. Thus, an issuer participating in any Exchange that receives advance payments of the premium tax credit or cost-sharing reductions on behalf of any of its enrollees is receiving Federal financial assistance from the Department. Section 1332 of the ACA permits a State to apply for a section 1332 waiver to pursue innovative strategies for providing residents with access to high quality, affordable health insurance while retaining the basic protections of the ACA. Section 1332 waiver funds constitute Federal financial assistance and States receiving such funds are recipients. As discussed in the 2022 NPRM, section 1332 allows States to apply to HHS and the Department of the Treasury to waive certain ACA requirements in the individual and small group markets if the waiver satisfies certain statutory 37 See section 1412 of the ACA, codified at 42 U.S.C. 18082 (Advance determination and payment of premium tax credits and cost-sharing reductions). 38 The Department is not currently making costsharing reduction payments to issuers. See Memo. from Eric Hargan, Acting Sec’y, U.S. Dep’t of Health & Hum. Servs., to Seema Verma, Admin’r, Ctrs. for Medicare & Medicaid Servs. (enclosing Attorney General Jeff Sessions’ legal opinion, dated October 11, 2017, regarding cost-sharing reduction payments) (Oct. 12, 2017), https://www.hhs.gov/ sites/default/files/csr-payment-memo.pdf. If the Department begins making cost-sharing reduction payments in the future, such payments would be considered Federal financial assistance. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations requirements.39 87 FR 47843. For example, under this provision, several States have utilized section 1332 waivers to introduce new or expanded plan options to consumers that lower premiums and/or expand access to coverage, or implemented reinsurance programs to lower premiums and stabilize the individual or small group market by compensating issuers for eligible high-cost claims for enrollees with significant medical costs. These State reinsurance programs use section 1332 pass-through funding to reimburse eligible issuers for high-cost enrollees. These States establish reimbursement eligibility criteria for issuers under the State’s reinsurance program, which may include payments to issuers offering coverage both on and off the Exchange. Health insurance issuers receiving payments through a State’s section 1332 waiver reinsurance program are subrecipients and therefore subject to section 1557. To the extent a State’s waiver utilizes pass-through funding for provider reimbursement those providers would also be subrecipients and subject to section 1557; however pass-through funding received by individual consumers would not be subject to section 1557. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘Federal financial assistance’’ as proposed in § 92.4, without modification. Health program or activity. OCR proposed to adopt a definition of ‘‘health program or activity.’’ In paragraph (1), we proposed defining health program or activity to mean any project, enterprise, venture, or undertaking to provide or administer health-related services, health insurance coverage, or other health-related coverage; provide assistance to persons in obtaining health-related services, health insurance coverage, or other health-related coverage; provide clinical, pharmaceutical, or medical care; engage in health research; or provide health education for health care professionals or others. In paragraph (2), we proposed further defining ‘‘health program or activity’’ to 39 Sections 1332(a)–(b) of the ACA, codified at 42 U.S.C. 18052(a)–(b). States with approved waivers have specific terms and conditions (STCs) pursuant to which the state must also comply with all applicable Federal statutes relating to nondiscrimination, including section 1557. See, e.g., Ctrs. for Medicare & Medicaid Servs., approval of New Jersey’s extension application for a section 1332 State Innovation Waiver, STC 4 (Aug. 15, 2023), https://www.cms.gov/files/document/1332nj-extension-approval-letter-stcs-final.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 include all of the operations of any entity principally engaged in the provision or administration of health projects, enterprises, ventures, or undertakings described in paragraph (1) (‘‘principally engaged’’). We proposed that whether such entities are administered by a government or a private entity, all of their operations would be covered under this part.40 We also invited comment on the circumstances under which a group health plan might receive funds that could be considered Federal financial assistance from the Department, including the type and prevalence of funds received that could be considered Federal financial assistance under this part. Comment: Commenters expressed a variety of views regarding the application of the rule to health insurance issuers as health programs or activities and the rule’s application to all their operations when principally engaged in any project, enterprise, venture, or undertaking to provide or administer health-related services, health insurance coverage, or other health-related coverage, as set forth under paragraph (2) of the definition of ‘‘health program or activity.’’ Many commenters supported the inclusion of health insurance issuers and coverage of all their operations when so principally engaged. These commenters argued the 2020 Rule’s approach, which applies to health insurance issuers only to the extent a specific plan receives Federal financial assistance, is contrary to the text of section 1557, the CRRA, and the broad remedial intent of Congress in enacting the ACA to ensure access to health insurance. Specifically, commenters argued the 2020 Rule is arbitrary and contrary to the plain language of section 1557, which applies to ‘‘any health program or activity, any part of which is receiving Federal financial assistance’’ (emphasis added) and specifically includes three examples of Federal financial assistance that refer to health insurance (‘‘credits, subsidies, or contracts of insurance’’). 42 U.S.C. 18116(a). This statutory language, commenters argued, affirms that Congress intended section 1557 to apply to the entire health program or activity, not just the parts that directly receive 40 See, e.g., Fain v. Crouch, 545 F. Supp. 3d 338, 343 (S.D.W. Va. 2021), rehearing en banc granted, No. 22–1927 (4th Cir. Apr. 12, 2023) (oral argument held Sept. 21, 2023) (argued with Kadel v. Folwell, No. 22–1721) (holding that defendant health plan was, ‘‘by virtue of its acceptance of Federal assistance under its Medicare Advantage program,’’ required to comply with section 1557 ‘‘under its entire portfolio’’). PO 00000 Frm 00017 Fmt 4701 Sfmt 4700 37537 Federal financial assistance. Commenters noted that the statutory text should be construed broadly and stated that the Proposed Rule’s application to health insurance will align with the application to all operations of other covered entities. Many commenters raised objections to the 2020 Rule’s provision at § 92.3(b) that covers all operations of an entity only when principally engaged ‘‘in the business of providing healthcare’’ (emphasis added), in combination with § 92.3(c) that specified a health insurance issuer was not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance, which resulted in the 2020 Rule not covering all operations of a recipient health insurance issuer. Commenters stated this approach was inconsistent with Congress’s approach in the CRRA, which supports an expansive interpretation of section 1557’s application to cover all operations of a recipient if any part of it receives Federal financial assistance. Specifically, one commenter asserted that the section 1557 statute’s use of the CRRA language ‘‘program or activity’’ and ‘‘any part of which,’’ coupled with the statute’s reference to title VI, title IX, section 504, and the Age Act, demonstrate Congress’s intent to adopt the same broad application for section 1557. Commenters also argued the 2020 Rule’s approach is inconsistent with the text of section 1557, which broadly applies to health programs or activities and is not limited to the delivery of health care. Commenters challenged the 2020 Rule’s contention that health insurance is not health care, arguing that health insurance issuers are in fact engaged in the business of health care and that other parts of the ACA support this position. For example, ‘‘health care entity’’ is defined to include ‘‘a health insurance plan’’ under 42 U.S.C. 18113(b) and 42 U.S.C. 300gg–91(b)(1) defines ‘‘health insurance coverage’’ to mean benefits consisting of medical care.’’ Among other things, commenters cited to section 1551 of the ACA, 42 U.S.C. 18111, which specifies that, unless otherwise indicated, the definitions in 42 U.S.C. 300gg–91 apply to title I of the ACA. Conversely, other commenters urged the Department to retain the 2020 Rule’s approach, asserting that the CRRA limits the scope of section 1557 with regard to all operations of a program or activity to only those that are ‘‘principally engaged in the business of providing . . . healthcare’’ (emphasis added). Others argued that the Proposed Rule’s application to health insurance is E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37538 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations too broad and should not apply to all operations of a health insurance issuer, particularly its lines of business that do not receive Federal financial assistance. Specifically, commenters noted that because health insurance issuers participate in some types of health insurance that receive Federal financial assistance and other types that do not, the Proposed Rule would require compliance even in activities that do not benefit from Federal financial assistance. Commenters opined that this interpretation goes beyond the scope of Congressional intent, where Congress did not apply the protections to any entity engaging in health programs and activities, but only to those health programs and activities that specifically receive Federal financial assistance. One organization asserted that the Proposed Rule could result in health insurance issuers incurring substantial costs and declining to participate in or withdrawing from the Exchanges, the Medicaid managed care market, or the Medicare Advantage market, resulting in reduced coverage options in those markets. Response: In re-evaluating the 2020 Rule’s interpretation of ‘‘health program or activity’’ as it relates to health insurance and in deciding to add a definition of ‘‘health program or activity,’’ OCR considered a number of factors, including the plain language of section 1557, the context of its placement within the ACA, longstanding civil rights principles, and relevant case law. The 2020 Rule does not include a definition of ‘‘health program or activity,’’ but rather addresses the term under § 92.3, the scope of application section. The 2020 Rule provides that ‘‘health program or activity’’ encompasses ‘‘all of the operations of entities principally engaged in the business of providing healthcare’’ (emphasis added) and specifies that a health insurance issuer is not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance. 45 CFR 92.3. The 2020 Rule further provides that for entities not principally engaged in the business of providing health care, their operations are only covered under the rule to the extent such operation is a health program or activity that receives Federal financial assistance. 45 CFR 92.3(b). Thus, the 2020 Rule limits OCR’s jurisdiction over health insurance issuers to only their plans that directly receive Federal financial assistance. This is in contrast to the 2016 Rule, which defined ‘‘health program or activity’’ to include all the operations of VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 entities principally engaged in health services, health insurance coverage, or other health-related coverage, including health insurance issuers, at former 45 CFR 92.4. OCR agrees with commenters’ assessment that the Proposed Rule’s approach to the inclusion of health insurance coverage and other healthrelated coverage in the definition of ‘‘health program or activity’’ is most consistent with section 1557’s statutory text and Congressional intent. The statutory text demonstrates Congress’s clear intent to apply section 1557 to health insurance coverage and other health-related coverage. This statutory text does not support the 2020 Rule’s limiting ‘‘health program or activity’’ to encompass all of the operations of only those entities principally engaged in the business of providing ‘‘healthcare.’’ Under the plain language of the statute, section 1557 applies to any ‘‘health’’ program or activity not ‘‘healthcare’’ program or activity. And the provision of health insurance coverage and other health-related coverage is plainly classified under the term ‘‘health.’’ Private health insurance issuers exercise significant control over enrollees’ access to health care and play a critical role in the business of health care, as insurance is an essential component of ensuring that people receive care in the current health care system. For example, a district court opinion on this issue held that a health insurance issuer, by virtue of being the ‘‘gatekeeper’’ to the plaintiff’s health services, qualified as a ‘‘ ‘health program’ that Congress intended to rid of discrimination.’’ 41 Further, as we discussed in the Proposed Rule, 87 FR 47845, the fact that Congress placed section 1557 in title I of the ACA, a title that predominantly regulates health insurance coverage and other healthrelated coverage with the purpose of increasing access to care and reducing discriminatory insurance practices, demonstrates Congress’s intent for section 1557 to protect individuals from discrimination in health insurance coverage and other health-related coverage. While not dispositive, we do appreciate commenters’ thoughts on whether health insurance issuers are in 41 Fain v. Crouch, 545 F. Supp. 3d 338, 342–43 (S.D.W. Va. 2021) (finding ‘‘ ‘health program or activity’ under Section 1557 necessarily includes health insurance issuers’’ and holding that defendant health plan was, ‘‘by virtue of its acceptance of federal assistance under its Medicare Advantage program,’’ required to comply with section 1557 ‘‘under its entire portfolio’’), rehearing en banc granted, No. 22–1927 (4th Cir. Apr. 12, 2023) (oral argument held Sept. 21, 2023) (argued with Kadel v. Folwell, No. 22–1721). PO 00000 Frm 00018 Fmt 4701 Sfmt 4700 fact engaged in the business of providing health care. Commenters among other things, cited to section 1551 of the ACA, which specifies that, unless otherwise indicated, the definitions in 42 U.S.C. 300gg–91 shall apply with respect to title I of the ACA. Section 300gg–91(b)(1) defines the term ‘‘health insurance coverage’’ as ‘‘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.) The 2020 Rule specifies that ‘‘medical care’’ as used in that provision is limited to the ‘‘amounts paid for’’ certain medical services and that a health insurance issuer is not considered to be principally engaged in the business of providing health care merely by virtue of providing health insurance. However, the text of section 1557 does not support the 2020 Rule’s position that the rule applies only to the business of providing ‘‘healthcare.’’ OCR found commenters’ concerns regarding the negative consequences that could result from the Proposed Rule’s scope of application to insurance issuers unpersuasive given the lack of information provided to substantiate their concerns. For example, one commenter cited to Exchange participation statistics that indicated certain issuers have limited or no Exchange participation.42 However, the statistics do not demonstrate the reason for such issuers’ lack of participation or provide evidence that an issuer’s decision not to participate in an Exchange was due to apprehension that section 1557 would apply to its activities that did not receive Federal financial assistance. The application of civil rights laws to all operations of an entity receiving Federal financial assistance is not new and did not originate with section 1557. For more than 35 years, under the CRRA, a recipient of Federal financial assistance that accepts Federal funds in any part of its program has been required to comply with title VI, section 504, and the Age Act in ‘‘all of the[ir] operations.’’ 43 The CRRA specifies that the entire program or activity, as defined in that statute, is required to comply with title VI, section 504, and the Age Act if any part of the program or activity receives Federal financial 42 Mark Farrah Assocs., https:// www.markfarrah.com (statistics compiled using data from the National Association of Insurance Commissioners, the California Department of Managed Health Care, and CMS). 43 Public Law 100–259, 102 Stat. 29 (Mar. 1988), codified at 20 U.S.C. 1687; 29 U.S.C. 794(b); 42 U.S.C. 2000d–4(a); 6107(4). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations assistance. We note that the terms ‘‘program’’ and ‘‘program or activity’’ predate the CRRA in the underlying civil rights statutes, and the legislative history of the CRRA indicates that Congress did not believe it was enacting a new definition, but rather overturning an overly narrow construction of the term by the Supreme Court and thereby restoring what Congress and the executive branch had previously understood to be a broad, institutionwide application of the term ‘‘program.’’ See S. Rep. No. 100–64 (1987). OCR maintains that Congress adopted a similar approach in section 1557 by specifying in the statute that section 1557 applies when ‘‘any part of’’ the health program or activity receives Federal financial assistance.44 Entities must comply with civil rights laws just as they must comply with any other State or Federal law that is applicable to their operations. The 2020 Rule states it was applying the CRRA’s definition of ‘‘program or activity’’ to cover all operations of entities under section 1557 only when they are ‘‘principally engaged in the business of providing healthcare.’’ We received some comments in support of the approach in that rulemaking, and while we appreciate the importance of the CRRA in shaping the interpretation of the scope of Federal civil rights protections under title VI, section 504, title IX, and the Age Act, it is not applicable here. Section 1557 employs the term ‘‘program or activity’’ without adopting by reference the CRRA or any of the underlying civil rights statutes. The 2020 Rule erred in applying the CRRA to narrow the application of section 1557 by excluding a significant portion of the health insurance industry. If Congress had intended to limit section 1557 to entities principally engaged in the business of providing ‘‘healthcare,’’ it could have provided as such in the statute. Instead, the statute expressly modified ‘‘program or activity’’ with ‘‘health,’’ without requiring that that entity be ‘‘principally engaged in the business of providing healthcare.’’ While Congress did not incorporate the CRRA into section 1557 wholesale, it stated that section 1557 applies to ‘‘any health program or activity, any part of which is receiving Federal financial assistance.’’ 42 U.S.C. 18116(a) (emphasis added). By modifying ‘‘program or activity’’ with ‘‘health,’’ and noting a health programs or activity is covered if ‘‘any part’’ of it receives 44 Compare CRRA, 20 U.S.C. 1687(4) (‘‘any part of which is extended Federal financial assistance’’) with section 1557, 42 U.S.C. 18116 (‘‘any part of which is receiving Federal financial assistance’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Federal financial assistance, it is reasonable to infer that Congress intended the term ‘‘health program or activity’’ to be interpreted broadly and to include all of that entity’s operations, if the entity that receives Federal funding is principally engaged in the provision or administration of health insurance coverage or other healthrelated coverage. And because ‘‘health program and activity’’ is undefined in the section 1557 statute, it is also reasonable to infer that those health programs or activities include healthrelated services, health insurance coverage, or other health-related coverage. Comment: One commenter argued that, because the CRRA delineates the scope of coverage of section 1557’s underlying civil rights statutes, failing to include this limitation in the final rule would expand the notion of Federal financial assistance to ultimate beneficiaries of the funding and would have significant effect on other civil rights laws dealing with funding, including title VI, title IX, and others. Response: The commenter’s concerns regarding interference with the longstanding principle that Federal civil rights laws do not apply to direct, unconditional assistance to ultimate beneficiaries are unsupported. Ultimate beneficiaries are the intended class of private individuals receiving Federal aid,45 a concept that is not impacted or modified under this rulemaking. In fact, the definition of ‘‘recipient’’ in the final rule at § 92.4 adopts standard language that explicitly states that the term ‘‘does not include any ultimate beneficiary.’’ Comment: OCR received comments specifically related to the rule’s application to health insurance issuers’ other products and lines of business that do not receive Federal financial assistance, such as health insurance coverage sold off the Exchange, excepted benefits, short-term, limitedduration insurance, and third party administrator activities. Response: These comments are addressed in the Scope of Application discussion under § 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage). Comment: Some commenters, including an association representing State insurance regulators, critiqued OCR’s ‘‘fungibility of funds’’ rationale for including all operations of recipients that are principally engaged in the provision or administration of health insurance coverage. These commenters 45 U.S. Dep’t of Justice, Title VI Legal Manual, section V.C.2.F. PO 00000 Frm 00019 Fmt 4701 Sfmt 4700 37539 argued it is inappropriate to consider funding to be fully fungible in the context of health insurance, where issuers justify their premiums based on expected costs in a particular market, not across all operations, and thus Federal financial assistance for one type of coverage does not actuarially support or subsidize an issuer’s operations in other markets. Commenters noted that entities have a myriad of corporate structures, and that Federal funds received by one legal entity might not be shared with sibling entities in unrelated business ventures. Commenters pointed to the 2016 Rule’s analysis regarding liability of third party administrators, where OCR discussed that a third party administrator that is legally separate from an issuer is unlikely to be covered under the rule. 81 FR 31433. Conversely, other commenters agreed with OCR’s fungibility of funds rationale, and argued that Federal financial assistance going to any part of a health program or activity necessarily benefits the entity receiving such funds as a whole. These commenters noted that a narrower construction, in which nondiscrimination rules apply only to part of a recipient, makes it easier for discriminatory actors to structure their operations to evade responsibility and frustrates the purpose of the statute. Response: As commenters noted, OCR discussed the fungibility of funds rationale as one means of support for the interpretation that all of a health insurance issuer’s operations will be covered by the final rule when the health insurance issuer receives Federal financial assistance. See 87 FR 47844. However, we note that reliance on this rationale is not necessary to support OCR’s interpretation that this final rule applies to all of the operations of a recipient that is ‘‘principally engaged,’’ as discussed above. Under the best reading of the statutory text, where an entity receives Federal financial assistance and that entity is ‘‘principally engaged in the provision or administration of any health projects, enterprises, ventures, or undertakings described in paragraph (1)’’ of the definition of ‘‘health program or activity,’’ the whole entity is defined as a health program or activity covered under section 1557 and must comply with the final rule. We acknowledge that covered entities may structure their businesses in a variety of ways. Unless an entity that is principally engaged can demonstrate that part of their operations is truly a separate legal entity, as discussed below, a recipient that is principally engaged is liable for all its operations under the final rule. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37540 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: One organization recommended that OCR explicitly identify patient billing and collections activities as ‘‘health programs or activities’’ by amending the definition to add a new paragraph (1)(vi) as follows: ‘‘provide or administer billing and collections services for health-related services, including providing assistance to persons to obtain financial help or counseling.’’ Response: This final rule, consistent with OCR’s other civil rights implementing regulations, prohibits covered entities—directly or through contractual or other arrangements—from discriminating in patient billing and collection activities related to health programs and activities. For example, a hospital’s in-house administration of billing would be covered and any contractual arrangement for collections of debt would also be covered. We decline to add the recommended language because it is unnecessary. Comment: Many commenters strongly supported the Proposed Rule’s explicit inclusion of health research in the definition of ‘‘health program or activity.’’ Some commenters recommended updating paragraph (1)(iv) to include ‘‘clinical’’ research for clarity and to update paragraph (2) to include: ‘‘clinical trial sites including wherever potential clinical trial participants are screened or recruited’’ in the list of entities considered ‘‘principally engaged.’’ In addition, other commenters recommended that OCR provide technical guidance in what ‘‘inclusion’’ in clinical research looks like and how it can be achieved through nondiscriminatory research protocols. Response: OCR supports the request to include clinical research in the definition of ‘‘health program and activity,’’ and have revised paragraph (1)(iv) accordingly. Clinical research is the comprehensive study of the safety and effectiveness of the most promising advances in patient care, and is different from laboratory research as it involves people who volunteer to help the field better understand medicine and health.46 However, we decline to add reference to physical sites, as the jurisdiction applies to the health program or activity regardless of where it takes place and whether it can be said to take place at a site at all. For example, if a hospital receives a grant from the National Institutes of Health to conduct a clinical study on the effects of Tuberous Sclerosis Complex, the 46 John Hopkins Medicine, Research, Understanding Clinical Trials, Clinical Research: What Is It?, https://www.hopkinsmedicine.org/ research/understanding-clinical-trials/clinicalresearch-what-is-it.html. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 hospital is prohibited from discriminating in its screening and recruitment activities wherever they take place, such as at the hospital itself, at community health fairs, online, or at the home of a hospital researcher who is working out of their own home. Comment: One organizational commenter requested that OCR clarify section 1557’s application to health research projects and activities to explicitly recognize that health research is conducted to answer specific questions, and that research protocols may target or exclude certain populations where nondiscriminatory justifications show that such criteria are appropriate, consistent with the 2016 Rule preamble. Response: Consistent with the 2016 Rule, OCR does not intend the inclusion of health or clinical research within the definition of ‘‘health program or activity’’ to alter the fundamental nature in which research projects are designed, conducted, or funded. 81 FR 31385. As in the 2016 Rule, we note that criteria in research protocols that target or exclude certain populations are warranted where nondiscriminatory justifications establish that such criteria are appropriate with respect to the health or safety of the subjects, the scientific study design, or the purpose of the research. See 81 FR 31385. Comment: Some commenters recommended that OCR narrow the definition of ‘‘health program or activity’’ to exclude programs and activities unrelated to health. These commenters also requested that OCR clarify what ‘‘any project, enterprise, venture or undertaking to provide or administer health-related services’’ means. For example, these commenters were unclear whether a health-related venture may include such things as vitamin manufacturing. Response: The final rule applies to health programs and activities that receive Federal financial assistance from the Department (or that are administered by the Department or a title I entity) and does not apply generally to programs and activities that are unrelated to health. However, where an entity is principally engaged as set forth in paragraph (2) of the definition of ‘‘health program or activity,’’ all operations of the covered entity must comply with the final rule. This applies even where the covered entities’ other operations are not necessarily healthrelated. Though not an exhaustive list, ‘‘health-related service’’ would include the provision of medical, dental, and pharmaceutical care; preventive health services; physical, occupational, or PO 00000 Frm 00020 Fmt 4701 Sfmt 4700 speech therapy; behavioral health care; clinical trials; and transportation to and from such services when necessary to facilitate access to other health-related services.47 Should an entity engaged in commercial vitamin manufacturing receive Federal financial assistance from the Department, OCR would conduct an analysis as to whether the program or activity in question meets the definition of ‘‘health program or activity.’’ Comment: A few commenters urged the Department to expressly list Medicaid programs, Children’s Health Insurance Program (CHIP), or the Basic Health Program in its definition for ‘‘health program or activity.’’ Response: The 2016 Rule included Medicaid programs, CHIP and the Basic Health Program in its definition of ‘‘health program or activity’’ at former 45 CFR 92.4. As stated in the preamble to the 2022 NPRM, these entities would be covered in their entirety as operations of State or local health agencies and we sought comment on whether such programs should be explicitly referenced in the regulatory language. 87 FR 47844. For clarity and to reduce confusion, OCR accepts the recommendation to include State Medicaid programs, CHIP, and the Basic Health Program in paragraph (2) of the definition of ‘‘health program or activity.’’ Comment: Numerous commenters objected to the 2022 NPRM’s proposal to not explicitly include group health plans 48 in the list of entities considered to be principally engaged in paragraph (2) of the ‘‘health program or activity’’ 47 See, e.g., 42 CFR 431.53 (requiring a state Medicaid plan to specify that the Medicaid agency will ensure ‘‘necessary transportation for beneficiaries to and from providers’’). 48 ‘‘Group health plan’’ is defined in the Employee Retirement Income Security Act (ERISA) as an employee welfare benefit plan to the extent that the plan provides medical care (as defined in paragraph (2) and including items and services paid for as medical care) to employees or their dependents (as defined under the terms of the plan) directly or through insurance, reimbursement, or otherwise. Such term shall not include any qualified small employer health reimbursement arrangement (as defined in 26 U.S.C. 9831(d)(2)). 29 U.S.C. 1191b(a)(1); see also 42 U.S.C. 300gg– 91(a)(1). ‘‘Employee welfare benefit plan’’ is defined in ERISA as any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment, or vacation benefits, apprenticeship or other training programs, or day care centers, scholarship funds, or prepaid legal services, or (B) any benefit described in 29 U.S.C. 186(c) (other than pensions on retirement or death, and insurance to provide such pensions). 29 U.S.C. 1002(1). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations definition. Expressing concerns that this would result in confusion that the rule excludes group health plans, commenters urged OCR to reinstate the 2016 Rule’s approach by expressly including group health plans in the definition of ‘‘health program or activity.’’ Former 45 CFR 92.4. Commenters further suggested that the rule clarify that group health plans are covered entities when the group health plan itself receives Federal financial assistance or when the employer sponsoring the group health plan receives Federal financial assistance, such as through an Employer Group Waiver Plan (EGWP) or Retiree Drug Subsidy (RDS) plan. Some commenters argued that an employer and a group health plan should not be treated as distinct entities for purposes of section 1557 jurisdiction, and that group health plans should be considered indirect recipients of Federal financial assistance when the employer receives Federal funds. Other commenters stated that employers are usually the sponsors of group health plans and were concerned that OCR’s case-by-case analysis may find an employer liable under section 1557 based on the employee benefits it provides. Several commenters expressed concerns with OCR’s proposed approach to conduct a case-by-case review to determine whether a group health plan is a covered entity and requested that OCR provide additional clarity on when employers and group health plans are liable under the rule. Response: Commenters’ concerns that group health plans would never be subject to the rule if they are not expressly included in the definition of ‘‘health program or activity’’ are unwarranted. The list of entities included as principally engaged, at paragraph (2), is not exhaustive. The fact that a group health plan is not expressly included in paragraph (2) does not affect the determination of whether a group health plan is principally engaged under this definition. As group health plans provide or administer group health coverage, they would be operating a health program or activity under the rule and would be subject to this rule if in receipt of Federal financial assistance. Further, recipient group health plans, like health insurance issuers, would be considered to be principally engaged in the provision or administration of health insurance coverage or other health-related coverage, meaning all their operations would be covered. In the 2022 NPRM, we declined to expressly include group health plans in VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 the definition of ‘‘health program or activity’’ in an attempt to reduce confusion because many group health plans do not receive Federal financial assistance. 87 FR 47845. It remains OCR’s understanding that many group health plans do not receive Federal financial assistance, and thus we decline commenters’ request to add group health plans to the nonexhaustive list of entities that are considered principally engaged that is provided in paragraph (2) of the definition of ‘‘health program or activity.’’ A group health plan that receives Federal financial assistance itself is distinct from other entities that might separately receive Federal financial assistance, such as the plan sponsor of the group health plan or the third party administrator administering the plan. As such, a group health plan does not necessarily become a covered entity under this rule by virtue of the plan sponsor or third party administrator’s receipt of Federal financial assistance. Single employers that are plan sponsors of single-employer group health plans and joint boards of trustees or similar bodies, associations, and other groups that are plan sponsors of multiemployer Taft-Hartley plans or multiple employer welfare arrangements (MEWAs) do not become covered entities under the rule due to their employment practices, including the provision of employee health benefits. Later in this section, we address how OCR will determine whether related business entities are considered separate legal entities under section 1557. When OCR receives a complaint alleging discrimination related to a group health plan, we will conduct a fact-specific analysis to determine if the group health plan is a recipient or subrecipient of Federal financial assistance. We decline to take the position that a group health plan is an indirect recipient of Federal financial assistance whenever the plan sponsor receives Federal financial assistance. Determining whether an entity is an indirect recipient requires a fact-specific inquiry.49 Entities that receive Federal financial assistance from the Department for an 49 See, e.g., Doe One v. CVS Pharmacy, Inc., No. 18–CV–01031–EMC, 2022 WL 3139516, slip op. at 7, 9 (N.D. Cal. Aug. 5, 2022) (analyzing whether defendant pharmacy benefit manager is an indirect recipient of Federal financial assistance from defendant pharmacy chain and, relying on the section 1557 statute and 2020 Rule, holding that CVS Pharmacy, Inc. is principally engaged in the business of health care and all of its operations are covered by section 1557, including its pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, L.L.C.). PO 00000 Frm 00021 Fmt 4701 Sfmt 4700 37541 EGWP or RDS plan would be subject to this rule, though we note that employers and other plan sponsors are not subject to this rule with regard to their employment practices, pursuant to § 92.2(b). This includes when the Federal financial assistance received is for their employee health benefits. For more information about employer and plan sponsor liability, see the previous discussion under § 92.2(b). In addition, as noted in the Proposed Rule, covered entities that contract with a group health plan could be subject to this rule themselves, regardless of the group health plan’s liability. For instance, recipient health insurance issuers may be covered under this rule when offering health insurance coverage to a fully-insured group health plan or when providing third party administrator services for a self-funded group health plan.50 We also noted in the Proposed Rule at 87 FR 47845 that even if a group health plan is not subject to section 1557, group health plans may be subject to other Federal nondiscrimination requirements.51 Comment: Some commenters urged OCR to expressly include pharmacy benefit managers in the definition of ‘‘health program or activity.’’ Commenters argued it was important to do so because pharmacy benefit managers play a significant role in developing and administering prescription drug benefits, and section 1557 can serve to prevent certain practices that may result in discriminatory access to medications, such as coverage criteria, utilization management practices, limitations on 50 See, e.g., Tovar v. Essentia Health, 857 F.3d 771, 778 (8th Cir. 2017) (holding that a third party administrator could be liable under section 1557 for damages arising from discriminatory terms in a selffunded employer-provided health plan if the third party administrator provided the employer with a discriminatory plan document, notwithstanding the fact that the employer subsequently adopted the plan and maintained control over its terms); C.P. v. Blue Cross Blue Shield of Ill., No. 20–cv–6145, 2022 WL 17788148, *7–9 (W.D. Wash. Dec. 19, 2022) (relying on the section 1557 statute because the ‘‘2020 Rule is contrary to the statutory law, and the rule appears to be arbitrary, capricious and contrary to law,’’ and holding that a health insurance issuer acting as a third party administrator for a selffunded employer-provided plan is a covered entity under section 1557, regardless of whether the discriminatory exclusion originated with the third party administrator, and ERISA’s requirement that decisions be made in accordance with the plan documents is no defense as ERISA expressly provides that it is not to be construed to invalidate or impair Federal laws like section 1557). 51 For example, group health plans and health insurance issuers offering group or individual health insurance coverage are generally prohibited from establishing any rule for eligibility, benefits, or premiums or contributions that discriminates based on any health factor. 26 U.S.C. 9802: 29 U.S.C. 1182; 42 U.S.C. 300gg–4; 26 CFR 54.9802– 1; 29 CFR 2590.702; 45 CFR 146.121, 147.110. E:\FR\FM\06MYR4.SGM 06MYR4 37542 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 where medicines can be dispensed, and high out of pocket costs. Response: We decline to list pharmacy benefit managers expressly in paragraph (2) of the definition of ‘‘health program or activity.’’ Pharmacy benefit managers are entities that manage prescription drug benefits for issuers, group health plans, Medicare Part D drug plans, and other payers, such as State Medicaid programs (collectively known as ‘‘payers’’).52 In their role of administering prescription drug benefits on behalf of payers, pharmacy benefit managers develop drug formularies and related policies, create pharmacy networks, reimburse pharmacies for patients’ prescriptions, negotiate rebates and fees with drug manufacturers, process enrollees’ claims and appeals, and review drug utilization, among other things.53 These activities constitute the operation of health programs and activities under section 1557. If pharmacy benefit managers receive Federal financial assistance from the Department, either directly or indirectly, they are subject to this rule. Further, if they are principally engaged under paragraph (2), all their operations are covered by the rule. As discussed previously, the fact that a type of entity—such as a pharmacy benefit manager—is not expressly included in the definition of ‘‘health program or activity’’ does not mean that those entities are excluded from the rule or could never be subject to section 1557 jurisdiction. Even if a pharmacy benefit manager does not receive direct Federal financial assistance, we note that the three largest pharmacy benefit managers are integrated with large health insurance or pharmacy companies, and thus could be covered under the rule as part of the operations of a health program or activity receiving Federal financial assistance.54 52 Staff of H. Comm. on Oversight & Reform, 117th Cong., A View from Congress: Role of Pharmacy Benefit Managers in Pharmaceutical Markets, 6 (Dec. 10, 2021), https://oversight. house.gov/wp-content/uploads/2021/12/PBMReport-12102021.pdf. 53 See, e.g., U.S. Gov’t Accountability Off., GAO 19–19–498, Medicare Part D: Use of Pharmacy Benefit Managers and Efforts to Manage Drug Expenditures and Utilization, 14–15, 39–42 (2019), https://www.gao.gov/assets/gao-19-498.pdf; Visante, Pharmacy Benefit Managers (PBMs): Generating Savings for Plan Sponsors and Consumers, pp. 3–4 (2023), https:// www.pcmanet.org/wp-content/uploads/2023/01/ Pharmacy-Benefit-Managers-PBMs-GeneratingSavings-for-Plan-Sponsors-and-Consumers-January2023.pdf. 54 See Doe One v. CVS Pharmacy, Inc., No. 18– cv–01031–EMC, 2022 WL 3139516, slip op. at 7, 9 (N.D. Cal., Aug. 5, 2022) (relying on the section 1557 statute and 2020 Rule when finding that CVS Pharmacy, Inc. is principally engaged in the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Determining whether a pharmacy benefit manager is subject to the rule as part of the operations of a recipient health program or activity is a factspecific analysis based on the corporate structure of the entity. Comment: Commenters requested that OCR provide more clarity on how it will analyze whether corporate subsidiaries and related business entities are subject to section 1557 as part of a covered entity’s operations. Specifically, some commenters were concerned about health insurance issuers that receive Federal financial assistance avoiding responsibility through use of subsidiaries in their other activities, such as third party administrators or pharmacy benefit managers. Conversely, other commenters expressed concerns that the rule would apply too broadly to an issuer’s business ventures that are unrelated to their federally funded activities. Response: As stated throughout this section, if any part of a health program or activity receives Federal financial assistance and the entity administering said health program or activity is principally engaged as provided in paragraph (2), then all the operations of the recipient are subject to the rule. If a part of a recipient’s operations is determined to be a separate legal entity independent from its federally funded activities, that part would not be subject to the rule. When determining whether an entity’s subsidiaries or other entities are legally separate from the federally funded activities, OCR may consider— among other things—the organizational structure and the interrelatedness between the entities, such as the degree of common ownership, management, and control between the entities, and whether the entities share centralized control of labor relations; whether the entity has some ability to accept or reject the Federal funding or exercise controlling authority over a federally funded program; 55 and whether the purpose of the legal separation was to avoid liability or avoid the application of civil rights law requirements, business of health care and all of its operations are covered by section 1557, including its pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, L.L.C.). 55 See id. Cf. Papa v. Katy Indus., Inc., 166 F.3d 937, 939 (7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA); Arrowsmith v. Shelbourne, Inc., 69 F.3d 1235, 1240–42 (2d Cir. 1995) (title VII); Valesky v. Aquinas Acad., 2011 U.S. Dist. LEXIS 103791, No. 09–800 (W.D. Pa. Sept. 14, 2011) (title IX); Russo v Diocese of Greenberg, 2010 U.S. Dist. LEXIS 96338, No. 09–1169 (W.D. Pa. Sept. 15, 2010) (title IX, section 504); Margeson v. Springfield Terminal Railway Co., 1993 U.S. Dist. LEXIS 12243, No. CIV.A. 91–11475–Z (D. Mass. Aug. 24, 1993) (section 504). PO 00000 Frm 00022 Fmt 4701 Sfmt 4700 meaning it is intended to allow the entity to continue to discriminate.56 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘health program or activity’’ as proposed in § 92.4, with modifications. We have revised paragraph (1)(iv) to include clinical research, such that it will now read: ‘‘Engage in health or clinical research.’’ We have also revised paragraph (2) to include ‘‘a State Medicaid program, Children’s Health Insurance Program, and Basic Health Program’’ as examples of entities principally engaged under this definition. Information and communication technology (ICT). We proposed to define the term ‘‘ICT’’ to mean ‘‘information technology and other equipment, systems, technologies, or processes, for which the principal function is the creation, manipulation, storage, display, receipt, or transmission of electronic data and information, as well as any associated content.’’ We also provided examples of ICT in our proposed definition. Comment: Some commenters urged OCR to include ‘‘electronic health records (EHRs)’’ as an example within the definition of ‘‘information and communication technology’’. Response: We appreciate that there are many different examples that can fit within the definition of ‘‘information and communication technology’’. We agree that EHRs meet the definition of ‘‘information and communication technology’’; however, we believe that it is unnecessary to specify this in the final rule. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘information and communication technology’’ as proposed in § 92.4, without modification. Language assistance services. OCR proposed to define the term ‘‘language assistance services’’ to include, but not be limited to: (1) oral language assistance, including interpretation in non-English languages provided inperson or remotely by a qualified interpreter for a limited English proficient individual, and the use of services of qualified bilingual or multilingual staff to communicate directly with limited English proficient 56 Papa v. Katy Indus., Inc., 166 F.3d 937, 941 (7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations individuals; (2) written translation, performed by a qualified translator, of written content in paper or electronic form into or from languages other than English; and (3) written notice of availability of language assistance services. The definitions of oral language assistance and written translation appeared in both the 2016 Rule at former § 92.4 and the 2020 Rule at § 92.101 in paragraphs (2)(i) and (iii) and have not been changed. The 2016 Rule did not explicitly include a written notice of availability of language assistance services in the definition of ‘‘language assistance services,’’ but rather included the term ‘‘taglines,’’ which was defined to mean ‘‘short statements written in non-English languages that indicate the availability of language assistance services free of charge.’’ Comment: One commenter recommended that the definition of ‘‘language assistance services’’ include assistance with form completion in another language. The commenter noted that many individuals with limited English proficiency (LEP) as well as many others (including older individuals and those with limited access to technology) have difficulty completing online forms to apply for health benefits or report life changes. Response: OCR appreciates the suggestion and agrees it is critical for individuals with LEP to receive language assistance in completing forms. The definition of ‘‘language assistance services’’ is intended to provide a non-exhaustive list of some of the means by which a covered entity may facilitate such access—namely, oral interpretation and written translation as provided by qualified interpreters and translators, respectively. This definition works together with the requirements at § 92.201, which provide that covered entities must take reasonable steps to provide meaningful access to individuals with LEP. If an individual with LEP needs assistance with form completion in a covered health program or activity, a covered entity must provide language assistance services consistent with the requirements at § 92.201. OCR declines to modify the definition of ‘‘language assistance services’’ as suggested because the context in which services are provided is not germane to the definition. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘language assistance services’’ as proposed in § 92.4, with modification. As discussed in the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 following summary of regulatory changes to the proposed term ‘‘limited English proficient individual,’’ we are revising the term to ‘‘individual with limited English proficiency’’ in § 92.4. Limited English proficient individual. OCR proposed to define the term ‘‘limited English proficient individual’’ to mean ‘‘an individual whose primary language for communication is not English and who has a limited ability to read, write, speak, or understand English.’’ Further, OCR proposed that a ‘‘limited English proficient individual’’ ‘‘may be competent in English for certain types of communication (e.g., speaking or understanding), but still be limited English proficient for other purposes (e.g., reading or writing).’’ These definitions appeared in the 2016 Rule and have not changed substantively. Former 45 CFR 92.4 (2016 Rule). OCR sought comment on whether to use the term ‘‘limited English proficient individual’’ or ‘‘individual with limited English proficiency’’ throughout the rule. Comment: Some commenters recommended the final rule adopt the language either ‘‘people with limited English proficiency’’ or ‘‘individual with limited English proficiency’’ instead of ‘‘limited English proficient individual.’’ Response: OCR agrees with this recommendation and OCR is finalizing the rule with the term ‘‘individual with limited English proficiency’’ throughout. Comment: Several commenters supported the proposed definition’s emphasis that an individual with LEP includes those who may be competent in English for certain types of communication but still have limited English proficiency for other purposes. Commenters explained that this will ensure providers and other covered entities understand that people who have some English competency may still need translated written materials. Commenters noted this will improve language access and have far-reaching consequences for patients who both seek and receive care, which will also reduce barriers to quality health care for individuals with LEP. Response: We appreciate the support of inclusion of additional details around what it means to be ‘‘limited English proficient’’ and are finalizing the definition as proposed. Comment: A few commenters that agreed with the proposed definition urged that the word ‘‘and’’ be replaced with ‘‘or’’ to read ‘‘an individual whose primary language for communication is not English or who has a limited ability to read, write, speak, or understand PO 00000 Frm 00023 Fmt 4701 Sfmt 4700 37543 English . . .’’ These commenters explained that there are many people in the United States whose primary language is English but who have a limited ability to read, write, speak, or understand English, for reasons that may or may not be related to disability, who deserve protection from discrimination. Response: OCR appreciates the commenters’ recommendation and recognizes that there are many individuals whose primary language is English but who have a limited ability to read, write, speak, or understand English. However, section 1557’s language access provisions rely on the statute’s prohibition on national origin discrimination.57 For individuals with LEP, the lack of proficiency in English and the use of non-English languages is often tied to their national origin. Changing the definition to include an individual who has a limited ability to read, write, speak, or understand English, but whose primary language is English, would go beyond national origin discrimination. With respect to individuals who have a limited ability to read, write, speak, or understand English related to disability, § 92.202 addresses requirements for effective communication for individuals with disabilities, which is a long-standing requirement. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘limited English proficient individual’’ as proposed in § 92.4, with modification. We are changing ‘‘limited English proficient individual’’ to ‘‘individual with limited English proficiency’’ in § 92.4 and throughout the final rule. Machine translation. OCR proposed to define the term ‘‘machine translation’’ to mean ‘‘automated translation, without the assistance of or review by a qualified human translator, that is text-based and provides instant translations between various languages, sometimes with an option for audio input or output.’’ Neither the 2016 Rule nor the 2020 Rule addressed machine translation. We invited comment on the adequacy of this new definition. Comment: We received many comments in support of the inclusion of a definition of ‘‘machine translation’’. One commenter supported the language as proposed but noted the importance of adaptability and potential for future regulation or guidance over time as 57 See Lau v. Nichols, 414 U.S. 563, 568–69 (1974). E:\FR\FM\06MYR4.SGM 06MYR4 37544 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 technology changes. For example, machine translation companies may develop technology that includes some level of human review but remains insufficient for the purposes of conforming with the intent of this rule. Response: We appreciate commenters’ support for the inclusion of this definition. The requirement to provide written translations via a qualified translator included at § 92.201(c)(2) continues to apply, regardless of whether human or machine translation is provided. Section 92.201(c)(3) requires a human translator to review machine translation under certain circumstances. The circumstances outlined in § 92.201(c)(3) set a minimum requirement for when machine translations must be reviewed by a qualified human translator— including circumstances that are critical to one’s rights or benefits. Thus, any machine translation technologies that are developed must include such review if they are to meet the requirements of this rule. OCR will continue to monitor the progression of this technology and will revisit regulatory updates as well as consider issuance of future guidance as needed. Comment: One commenter stated that the definition of ‘‘machine translation’’ should include reference to the use of software or automated tools. Specifically, the commenter recommended modifying the language to read ‘‘machine translation is the use of automated translation software or tools, without the assistance of . . .’’ Response: OCR appreciates the commenter’s suggestion to explicitly refer to software or automated tools; however, the definition as proposed sufficiently accounts for translations that would be generated by software or automated tools as it refers to ‘‘automated translation.’’ Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘machine translation’’ as proposed in § 92.4, with modification. We are making a technical correction to change ‘‘automated translations’’ to ‘‘automated translation.’’ National Origin. We proposed to define the term ‘‘national origin’’ to mean ‘‘a person’s, or their ancestor’s, place of origin or a person’s manifestation of the physical, cultural, or linguistic characteristics of a national origin group.’’ This is consistent with the 2016 Rule’s definition of ‘‘national origin,’’ and with the well-established definition of the term that the Equal VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Employment Opportunity Commission (EEOC) uses in its interpretation of title VII.58 Comment: Various commenters discussed the need to include this definition to address entrenched inequities and practices that can constitute national origin discrimination but are not always recognized. This includes the failure to take reasonable steps to provide meaningful access for individuals with LEP, even though such a failure has been long recognized as a form of national origin discrimination. Commenters added that there are also clear intersections between LEP status and race and ethnicity because the great majority of individuals with LEP are people of color; however, they noted that when individuals seek to vindicate their civil rights, they often must choose between pursuing a claim based on either their LEP status or race. Commenters also provided examples of how some people have been denied benefits they are entitled to due to national original discrimination. Several national organizations and local service providers commented that refugees, migrant workers, and other immigrants experience barriers to federally funded or provided health care due to fears related to their immigration status. Response: OCR appreciates commenters’ support for inclusion of this definition. We recognize that individuals can experience both national origin and race discrimination (or national origin discrimination and discrimination on another protected basis) and are finalizing new regulatory language that provides additional clarity and addresses such instances in which individuals may experience discrimination under multiple bases. See discussion regarding § 92.101. OCR appreciates comments related to immigration status. While section 1557 does not prohibit discrimination on the basis of immigration status, we note that differential treatment such as requiring additional verification or documentation from individuals based on their appearance, name, accent, LEP, or suspected immigration status may violate section 1557 and other civil rights laws.59 58 29 CFR 1606.1; see, also, U.S. Equal Emp. Opportunity Comm’n, EEOC Enforcement Guidance on National Origin Discrimination, https:// www.eeoc.gov/laws/guidance/eeoc-enforcementguidance-national-origin-discrimination#_ Toc451518799. 59 See, e.g., U.S. Dep’t of Justice, Guidance to State and Local Governments and Other Federally Assisted Recipients Engaged in Emergency Preparedness, Response, Mitigation, and Recovery Activities on Compliance with Title VI of the Civil Rights Act of 1964, Section D, https:// www.justice.gov/crt/fcs/EmergenciesGuidance. PO 00000 Frm 00024 Fmt 4701 Sfmt 4700 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘national origin’’ as proposed in § 92.4, with modification. We are making a technical correction to change ‘‘ancestor’s’’ to ‘‘ancestors’.’’ Patient care decision support tool. The Proposed Rule described but did not include a definition in § 92.4 for, the term ‘‘clinical algorithms.’’ See 87 FR 47880. Many commenters supported the inclusion of a provision such as proposed § 92.210, addressing nondiscrimination in the use of clinical algorithms in decision-making, but recommended OCR clarify that the provision applies to tools used to assess health status, recommend care, determine eligibility, allocate resources, conduct utilization review, and provide disease management guidance. Further, commenters requested that OCR define what tools are covered under § 92.210. Based on comments received, we are replacing the term ‘‘clinical algorithm’’ with the more precise term ‘‘patient care decision support tool,’’ and we are adding a definition for ‘‘patient care decision support tool’’ to mean ‘‘any automated or non-automated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decisionmaking in its health programs or activities.’’ The definition of ‘‘patient care decision support tool’’ reaffirms that § 92.210 applies to tools used in clinical decision-making that affect the care that patients receive. This includes tools, described in the Proposed Rule, used by covered entities such as hospitals, providers, and payers (health insurance issuers) in their health programs and activities for ‘‘screening, risk prediction, diagnosis, prognosis, clinical decision-making, treatment planning, health care operations, and allocation of resources’’ as applied to the patient. 87 FR 47880. We clarify that tools used for these activities include tools used in covered entities’ health programs and activities to assess health status, recommend care, provide disease management guidance, determine eligibility and conduct utilization review 60 related to patient care that is 60 See, e.g., Patrick Rucker et al., How Cigna Saves Millions by Having Its Doctors Reject Claims Without Reading Them, ProPublica (March 25, 2023), https://www.propublica.org/article/cignapxdx-medical-health-insurance-rejection-claims; Casey Ross & Bob Herman, Denied by AI: How Medicare Advantage Plans Use Algorithms to Cut Off Care for Seniors in Need, STAT News (March 13, 2023), https://www.statnews.com/2023/03/13/ medicare-advantage-plans-denial-artificialintelligence/. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 directed by a provider, among other things, all of which impact clinical decision-making. Please see our discussion regarding § 92.210, where we discuss ‘‘patient care decision support tool’’ in more detail, including examples of tools to which § 92.210 does not apply. Summary of Regulatory Changes Considering the comments received, we are finalizing the definition of ‘‘patient care decision support tool’’ in § 92.4 to mean ‘‘any automated or nonautomated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decision-making in its health programs or activities.’’ Qualified Bilingual/Multilingual Staff. OCR proposed to define the term ‘‘qualified bilingual/multilingual staff’’ to mean a member of a covered entity’s workforce who is designated by the covered entity to provide oral language assistance directly to an individual in their primary language as part of the person’s current, assigned job responsibilities and who has demonstrated to the covered entity that they are: (1) proficient in speaking and understanding both spoken English and at least one other spoken language, including any necessary specialized vocabulary, terminology, and phraseology; and (2) able to effectively, accurately, and impartially communicate directly with individuals with LEP in their primary language. Comment: Some commenters urged that additional attention should be given to assessing qualifications for selfidentified bilingual/multilingual staff abilities to provide services in languages other than English, and that policies and procedures should be developed to assess and retain their competency. Additionally, some commenters recommended establishing qualifications for bilingual/multilingual staff who may also be expected to serve as interpreters, and added that they should be compensated appropriately. Commenters stated that research has shown that bilingual staff who are not qualified interpreters often do not feel comfortable serving as interpreters. A commenter posited that bilingual/ multilingual staff must be provided training and compensation opportunities to support professional development and prevent staff turnover and burnout. Response: OCR appreciates the commenters’ suggestions to establish assessment requirements for qualified bilingual/multilingual staff; however, we believe the current definition establishes sufficient requirements and VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 guidelines regarding the necessary skills a qualified bilingual/multilingual staff member must have. The definition sets forth a two-prong definition to ensure proficiency, effectiveness, and impartiality in direct communications with individuals with LEP in their primary languages, including any necessary specialized vocabulary, terminology, and phraseology. Similar to the rule’s definitions for qualified interpreters and qualified translators, OCR has established the necessary skills that must be held to meet the definition, while providing covered entities the flexibility by which to have these skills assessed. We note that an individual’s self-identification as bilingual or multilingual alone is insufficient to determine whether they meet this definition, and covered entities should determine processes by which they will independently determine and periodically assess an individual’s qualifications. While qualified bilingual/multilingual employees may also be qualified interpreters, the ability to interpret is a separate skill. Anyone whom a covered entity allows to serve as an interpreter must be qualified to do so, consistent with the definition of ‘‘qualified interpreter for an individual with limited English proficiency’’ in this section, independent of whether they have been identified as a qualified bilingual/multilingual staff member. OCR will consider developing guidance and providing technical assistance for covered entities on mechanisms for covered entities to assess if staff members meet the requirements. Consistent with the Department’s approach on language access, OCR encourages covered entities to provide training and compensation opportunities to support professional development for bilingual/multilingual staff. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘qualified bilingual/ multilingual staff’’ as proposed in § 92.4, with modification. As discussed in the summary of regulatory changes to the proposed term ‘‘limited English proficient individual,’’ we are revising the term to ‘‘individual with limited English proficiency’’ in § 92.4. Qualified interpreter for an individual with a disability. We proposed to define the term ‘‘qualified interpreter for an individual with a disability’’ to mean ‘‘an interpreter who . . . is able to interpret effectively, accurately, and impartially, both receptively and PO 00000 Frm 00025 Fmt 4701 Sfmt 4700 37545 expressively, using any necessary specialized vocabulary.’’ Such an interpreter may interpret via a video remote interpreting service (VRI) or in person. We also provided a nonexhaustive list of examples of qualified interpreters, to include sign language interpreters, oral transliterators, and cued-language transliterators. Comment: Most of the commenters recommended that OCR amend this definition to include the three (3) parts of the definition of ‘‘qualified interpreter for an individual with limited English proficiency’’, which requires that the qualified interpreter: (1) has demonstrated proficiency, (2) is able to interpret effectively, accurately, and impartially, (3) and adheres to generally accepted interpreter ethics principles. Commenters noted that these revisions would provide alignment between the different types of interpreters and recognize that similar standards should apply regardless of whether an interpreter is interpreting for an individual with LEP or a person with a disability. Commenters recommended that the definition include that a qualified interpreter for a person with a disability demonstrate proficiency. For sign language interpreters, this should include proficiency in speaking or communicating in and understanding both English and a relevant sign language, noting that not all individuals who are deaf or hard of hearing are signers of American Sign Language (ASL). Some commenters also recommended that in order to be proficient, Certified Deaf Interpreters (CDI) must have specialized training in Deaf interpreting in addition to the basic CDI training. For transliterators, these commenters recommended that the rule require proficiency in the relevant alternative communication modality, such as cued speech or oral transliteration. Commenters further stated that an interpreter for an individual with a disability should communicate ‘‘without changes, omissions, or additions while preserving the tone, sentiment, and emotional level of the original statement.’’ Finally, commenters stated that an interpreter for an individual with a disability must also adhere to the principles contained in recognized standards of practice and professional codes of ethics for health care interpreters, such as those of the National Council on Interpreting in Health Care and the Registry of Interpreters for the Deaf. Response: We appreciate commenters’ recommendation to revise the definition E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37546 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations of ‘‘qualified interpreter for an individual with a disability’’ to align more closely with the definition of ‘‘qualified interpreter for an individual with limited English proficiency’’. While the proposed definition is consistent with the ADA, we agree that the standards for a qualified interpreter should be equivalent regardless of whether an individual has LEP or has a disability. We have revised the definition for consistency among the standards, which is also consistent with the 2016 Rule’s definition at former 45 CFR 92.4. Comment: Some commenters recommended aligning the two qualified interpreter definitions but recommended that a revised definition be expanded to recognize qualified interpreters who have demonstrated proficiency in speaking and understanding two non-English languages. These commenters noted that not all interpreters for people with disabilities are interpreting between English and another language. For example, these commenters noted that a CDI may be interpreting between an individual who is deaf and uses a unique version of ASL and a nonAmerican sign language, or home signs unfamiliar to the medical interpreter. Commenters were concerned that a definition that specified interpretation ‘‘between English and non-English language’’ would exclude CDIs and cued-language transliterators. These commenters recommended a multipronged definition where several contexts are taken into consideration and is inclusive of ASL-to-English interpretation, ASL-to-ASL CDI interpretation, and cued-language transliteration. Response: As proposed, the definition of ‘‘qualified interpreter for an individual with a disability’’ does not reference ‘‘English’’ or a ‘‘non-English language,’’ but rather included a nonexhaustive list of examples of qualified interpreters inclusive of sign language interpreters, oral transliterators, and cued-language transliterators. However, as previously discussed, we have revised the definition of ‘‘qualified interpreter for an individual with a disability’’ to be more aligned with the definition of ‘‘qualified interpreter for an individual with limited English proficiency.’’ The revised definition includes language that is inclusive of different types of interpretation and also includes the non-exhaustive list of examples from the proposed definition. Comment: Some commenters noted that a covered entity must not use the services of staff who use sign language or another communication modality to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 act as interpreters and relay information to individuals with disabilities unless they meet the definition of a ‘‘qualified interpreter for an individual with a disability’’ found within this section, and they meet the unique needs of the individual for whom the services of an interpreter is being provided. Response: The definition of a ‘‘qualified interpreter for an individual with a disability’’ addresses these concerns; and anyone designated by a covered entity to serve as an interpreter for an individual with a disability must be qualified to do so. Comment: Some commenters recommended that the definition of ‘‘qualified interpreter for a person with a disability’’ take into consideration applicable State law governing licensure of interpreters if any are available in the State where the covered entity provides services. These commenters noted that the process of who can serve as a qualified interpreter differs from State to State, and OCR should adopt language that reflects the minimum standards of State laws governing qualifications of sign language interpreters, if any. Response: OCR understands and appreciates commenters raised concerns. Covered entities may use adherence to State law governing licensure as a means by which to demonstrate compliance with this definition, provided licensure demonstrates the individual possesses the requirements provided in the definition. OCR declines to adopt language that incorporates any State law licensure requirements as a minimum standard of compliance with this rule. Comment: Some commenters raised concerns over the qualifications of interpreters. Commenters recommended that the definition include the requirement that an interpreter be certified or assessed by a formal process that objectively measures the competency of the individual. Other commenters recommended that health care entities include a screening system to ensure quality assurance of the abilities of the sign language interpreters to meet the needs of the patients. Response: OCR appreciates the commenters’ recommendations to require certification for qualified interpreters and agrees that covered entities should ensure that the use of interpreter services provides for effective communication. OCR will take into account certification in assessing compliance with this regulation; however, as we will discuss below in the response for certification of qualified interpreter for an individual with LEP in § 92.201, we decline to require certification in the definition of PO 00000 Frm 00026 Fmt 4701 Sfmt 4700 ‘‘qualified interpreter for an individual with a disability.’’ Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘qualified interpreter for an individual with a disability’’ in § 92.4, to more closely align with the definition of ‘‘qualified interpreter for an individual with limited English proficiency,’’ such that it now means an interpreter who, via a video remote interpreting service (VRI) or an on-site appearance: (1) has demonstrated proficiency in communicating in, and understanding: (i) both English and a non-English language (including American Sign Language, other sign languages); or (ii) another communication modality (such as cuedlanguage transliterators or oral transliteration); (2) is able to interpret effectively, accurately, and impartially, both receptively and expressively, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original statement; and (3) adheres to generally accepted interpreter ethics principles including client confidentiality. Qualified interpreters include, for example, sign language interpreters, oral transliterators, and cued-language transliterators. Qualified interpreter for a limited English proficient individual. OCR proposed to define the term ‘‘qualified interpreter for a limited English proficient individual’’ to mean an interpreter who via a remote interpreting service or an on-site appearance: (1) has demonstrated proficiency in speaking and understanding both spoken English and at least one other spoken language; (2) is able to interpret effectively, accurately, and impartially to and from such language(s) and English, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original oral statement; and (3) adheres to generally accepted interpreter ethics principles, including client confidentiality. This definition is consistent with both the 2016 Rule at former § 92.4 and the 2020 Rule at § 92.101(b)(3)(i). Comment: Some commenters who otherwise supported this definition expressed concern that, as written, it may inadvertently create difficulties for interpreting in certain languages, especially indigenous languages of Central and South America. These E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations commenters recommended that the definition be amended to allow for the use of services of relay interpreters, such as those who are proficient in an indigenous language and another language such as Spanish. Commenters explained that these interpreters may not be fluent in spoken English or trained to interpret to and from spoken English, and that those who are qualified to interpret between two nonEnglish languages are critical in providing meaningful access for many isolated and marginalized communities. Furthermore, a few of these commenters recommended the inclusion of the following definition for relay interpreting: ‘‘relay interpreting means a form of simultaneous interpreting when the speech is rendered from an intermediate language rather than directly from the source language.’’ One commenter recommended adding ‘‘and dialect’’ after ‘‘spoken language’’ under paragraph (1) to acknowledge that speakers of a language may not always be qualified to interpret for a person who speaks a variation in that language and adding ‘‘understanding and’’ before ‘‘using necessary specialized vocabulary or terms’’ under paragraph (2) to indicate that providing effective interpretation for complex situations, such as communicating a treatment regimen, requires understanding of the terminology being used, particularly given the consequences of a miscommunication. Response: OCR appreciates and understands concerns that the proposed definition may inadvertently create obstacles for meaningful access in certain languages. For example, if a Zapotec-speaking patient with LEP attended a medical appointment and the hospital could not find an individual qualified to interpret between Zapotec and English after reasonable efforts, the hospital could utilize the services of two qualified interpreters that could perform relay interpretation between Zapotec and Spanish and Spanish and English. While relay interpretation may introduce challenges related to accuracy, it may be necessary to afford meaningful access for individuals who speak languages, dialects, or variants not common to the area where they are receiving services. For this reason, we are revising the definition of a ‘‘qualified interpreter for an individual with limited English proficiency’’ to provide that the qualified interpreter (1) has demonstrated proficiency in speaking and understanding both spoken English and at least one other spoken language (qualified interpreters for relay interpretation must demonstrate VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 proficiency in two non-English spoken languages); and (2) is able to interpret effectively, accurately, and impartially to and from such language(s) and English (or between two non-English languages for relay interpretation), using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original oral statement. This provision makes clear that specialized skills and vocabulary may be needed for less commonly spoken languages as well as dialects. In light of these modifications to the definition of ‘‘qualified interpreter for an individual with limited English proficiency’’, we are also adding and finalizing a definition of ‘‘relay interpretation’’ to mean interpreting from one language to another through an intermediate language. This mode of interpretation is often used for monolingual speakers of languages of limited diffusion, including select indigenous languages. In relay interpreting, the first interpreter listens to the speaker and renders the message into the intermediate language. The second interpreter receives the message in the intermediate language and interprets it into a third language for the speaker who speaks neither the first nor the second language. Lastly, OCR appreciates the commenter’s suggestion to add ‘‘understanding and’’ before ‘‘using necessary specialized vocabulary or terms’’ under paragraph (2). However, the interpreter themself does not need to understand complex medical concepts behind medical terms but rather must be able to interpret said terms effectively and accurately. OCR is of the view that the interpretation should directly convey the provider and patient’s words and phrases in order to avoid the risk that the individual’s message was not accurately communicated. Further, paragraph (1) already requires that the interpreter have ‘‘proficiency in speaking and understanding’’ the languages at issue (emphasis added). Comment: A few commenters recommended the definition address how an individual would demonstrate proficiency in English and another language (i.e., through use of an established standard for describing language ability, such as the Common European Framework of Reference of Languages 61). Some commenters recommended implementing a 61 Council of Europe, Common European Framework of Reference for Languages (CEFR), https://www.coe.int/en/web/common-europeanframework-reference-languages/introduction-andcontext. PO 00000 Frm 00027 Fmt 4701 Sfmt 4700 37547 certification requirement and suggested implementing a national credential requirement that establishes interpretation proficiency for enforcement purposes. Some commenters requested that OCR lay out examples of when it would be appropriate to require qualified interpreters to obtain certification in order to comply with section 1557. Commenters expressed their belief that the proposed definition could be easily misinterpreted and result in assigning the least skilled interpreter for a medical encounter. Response: OCR appreciates the commenters’ suggestions to establish certification requirements for qualified interpreters; however, there are currently no consistent certification standards and there is also a lack of certification available for a significant number of languages. The requirements in this definition provide sufficient standards for determining interpreter qualifications. Individuals that hold a certification will still need to meet the standards provided in this definition. For covered entities seeking information on certification, we encourage covered entities to review the Department of Justice’s (DOJ) resource regarding what it means to be a certified linguist.62 Comment: One commenter encouraged OCR to include ‘‘via a video remote interpreting service’’ to the definition because telehealth can be an important tool for expanding access to interpretation for individuals with LEP. Response: The definition as proposed and finalized includes interpreter services provided via remote interpreting services and is therefore inclusive of video remote interpreting as drafted. Comment: One commenter noted that we use the phrase ‘‘use an interpreter’’ in our text. They recommended we use the wording ‘‘utilize the services of an interpreter’’ instead. Response: OCR agrees that we are referring to the utilization of interpreter services and have adjusted the use of this phrase accordingly. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments we received, we are revising the definition for a ‘‘qualified interpreter for an individual with limited English proficiency’’ as proposed in § 92.4, with modifications. To account for concerns related to relay 62 U.S. Dep’t of Justice, Fed. Coordination & Compliance Section, What Does It Mean to Be a Certified Linguist (2014), https://www.justice.gov/ crt/page/file/1255916/download. E:\FR\FM\06MYR4.SGM 06MYR4 37548 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 interpreting, we are revising paragraph (1) to add ‘‘(qualified interpreters for relay interpretation must demonstrate proficiency in two non-English spoken languages).’’ As discussed in the summary of regulatory changes to the proposed term ‘‘limited English proficient individual’’ we are revising the term to ‘‘individual with limited English proficiency’’ in § 92.4. We are also adding a definition of ‘‘relay interpretation’’ to § 92.4 to mean interpreting from one language to another through an intermediate language. This mode of interpretation is often used for monolingual speakers of languages of limited diffusion, including select indigenous languages. In relay interpreting, the first interpreter listens to the speaker and renders the message into the intermediate language. The second interpreter receives the message in the intermediate language and interprets it into a third language for the speaker who speaks neither the first nor the second language. Qualified Reader. We proposed to define the term ‘‘qualified reader’’ to mean ‘‘a person who is able to read effectively, accurately, and impartially using any necessary specialized vocabulary,’’ which comes from the ADA title II regulation at 28 CFR 35.160 through 35.164. This definition, which did not appear in the 2016 or 2020 Rules, was included to provide clarity to both covered entities and protected individuals about the necessary qualifications of a reader when required under this regulation. Comment: Commenters supported the addition of ‘‘qualified reader’’ to the proposed list of definitions. Response: OCR appreciates the commenters support for adding the definition of ‘‘qualified reader’’ to the proposed list of definitions. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments we received, we are finalizing the definition of ‘‘qualified reader’’ as proposed in § 92.4, without modification. Qualified Translator. OCR proposed to define the term ‘‘qualified translator’’ to mean a translator who: (1) has demonstrated proficiency in writing and understanding both written English and at least one other written non-English language; (2) is able to translate effectively, accurately, and impartially to and from such language(s) and English, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original written VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 statement; and (3) adheres to generally accepted translator ethics principles, including client confidentiality. This definition of ‘‘qualified translator’’ appeared in the 2016 Rule at § 92.4 and appears in the 2020 Rule at § 92.102(b)(2)(ii) and has not been changed. Comment: One commenter recommended that the definition of a ‘‘qualified translator’’ include the requirement that such individuals, for purposes of providing translation services, be certified or assessed by a formal process that objectively measures the competency of the individual. A number of commenters stated that high quality translation is essential to providing equal access to health care and health services. Some added that oral interpretation is critical to ensuring understanding of written translations, some of which have been inaccurate or insufficient to convey the complicated medical and technical terms translated in the communications. Response: OCR appreciates the commenter’s suggestion to require that a qualified translator be certified or objectively assessed to verify competency in translating. For the reasons we provided when declining to require certification of qualified interpreters for individuals with LEP, we decline to specify the means by which a covered entity may determine that an individual meets the definition of ‘‘qualified translator’’. In order to be qualified, translators must meet the definition provided in the rule. OCR also notes that reasonable steps to provide meaningful access may require the provision of both written translation and oral interpreting, and thus utilizing the services of both a qualified translator and a qualified interpreter may be necessary under certain circumstances. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the definition of ‘‘qualified translator’’ as proposed in § 92.4, without modification. State. The 2022 NPRM did not propose a definition of the term ‘‘State.’’ However, based on comments received, we became aware that there may be some confusion as to what encompasses ‘‘State’’ for purposes of this final rule. We therefore have decided to include a definition of ‘‘State.’’ Summary of Regulatory Changes Considering the comments received, we are finalizing a definition of ‘‘State’’ in § 92.4 to mean ‘‘each of the several PO 00000 Frm 00028 Fmt 4701 Sfmt 4700 States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, the Trust Territory of the Pacific Islands, and the Commonwealth of the Northern Mariana Islands.’’ This definition is consistent with the ADA regulations at 28 CFR 35.104. Telehealth. The 2022 NPRM did not propose a definition of the term ‘‘telehealth.’’ However, based on comments received, we became aware that there may be some confusion as to what encompasses ‘‘telehealth’’ for purposes of this final rule. We therefore have decided to include a definition of ‘‘telehealth.’’ Summary of Regulatory Changes Considering the comments received, we are finalizing a definition of ‘‘telehealth’’ in § 92.4 to mean the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional healthrelated education, public health, and health administration. Technologies include videoconferencing, the internet, store-and-forward imaging, streaming media, and terrestrial and wireless communications. This definition is consistent with the Health Resources and Services Administration and the Office of the National Coordinator for Health Information Technology definitions referenced in the 2022 NPRM, 87 FR 47884. Assurances Required (§ 92.5) In § 92.5 of the 2022 NPRM, we proposed retaining the requirement of the 2016 and 2020 Rules, at former § 92.5 and current § 92.4 respectively, for recipients to submit assurances of compliance to OCR. In paragraph (a), we proposed that each entity applying for Federal financial assistance, each issuer seeking certification to participate in an Exchange, and each State seeking approval to operate a State Exchange is required to submit an assurance that its health programs and activities will be operated in compliance with section 1557 and this part, consistent with similar requirements found in the implementing regulations for title VI, title IX, section 504, and the Age Act. The duration of obligation (proposed paragraph (b)), and covenants language (proposed paragraph (c)) adopt the corresponding requirements found in the section 504 regulation at 45 CFR 84.5. The comments and our responses regarding § 92.5 are set forth below. Comment: Commenters expressed support for the assurances provision included in the 2022 NPRM because it E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations is consistent with other Federal civil rights regulations and the 2016 and 2020 Rules, and it is reasonable for OCR to require recipients of Federal financial assistance to comply with section 1557 as a condition of receiving that funding. One organizational commenter recommended revising this requirement to conditioning prospective recipients’ receipt of Department Federal financial assistance on recipients’: (1) collection of demographic data such as race, ethnicity, spoken and written language, disability status, age, sex, gender identity, sex characteristics, and sexual orientation; and (2) submission of a written proposal (including through written policies and procedures) about how they intend to provide language assistance services, auxiliary aids and services, and whether an entity’s proposed budget includes funding to meet these identified needs. Response: We appreciate the suggestion to include a data collection requirement in this provision, but do not believe such a requirement is appropriate, as this language is longstanding and consistent across civil rights regulations. We address data collection in further detail later in this preamble, when discussing responses to our request for comment on the issue. We also decline to revise § 92.5 to require Federal financial assistance applicants to provide OCR with budget information and a written proposal about how they intend to provide language assistance services and auxiliary aids and services as a condition of receiving Federal financial assistance. The combined requirements at §§ 92.8 (Policies and procedures), 92.201 (Meaningful access for individuals with LEP), 92.202 (Effective communication for individuals with disabilities), and 92.205 (Requirement to make reasonable modifications) address the commenter’s concerns regarding a recipient’s obligation and ability to provide language assistance services and auxiliary aids and services. Comment: One commenter raised concerns that proposed § 92.5’s requirement that recipients make assurances to comply with all provisions of the rule does not take into account situations where a third party administrator could otherwise lawfully administer a plan sponsored by a religious employer that does not conform to OCR’s current interpretation of section 1557 with regard to the prohibition on sex discrimination. Specifically, the commenter suggested that a third party administrator may be inhibited from submitting an assurance required by § 92.5 because (1) of the Employee Retirement Security Act of VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 1974 (ERISA), 29 U.S.C. 1104(a)(1)(D), which for example, obligates such a third party administrator to administer the religious employer’s self-insured health plan in accordance with terms that may conflict with section 1557’s prohibition of sex discrimination; and (2) there are injunctions that currently prohibit OCR from enforcing prohibitions on sex discrimination against religious employers and those acting in concert with them.63 Response: OCR complies with court orders, including court-ordered injunctions. If a recipient third party administrator is covered by any current court order or court-ordered injunction, OCR would not find the third party administrator to be in violation of section 1557 or this rule for its activities that are covered by the injunction, and such an entity would not need to provide an assurance under § 92.5 to the extent it conflicts with a current court order or court-ordered injunction by which they are covered. Regarding the commenter’s point that third party administrators are required under ERISA to administer plans consistent with the plan’s terms, OCR addresses this issue in detail under the third party administrator section of § 92.207. In short, while we acknowledge that ERISA requires plans to be administered consistent with the documents and instruments governing the plan,64 ERISA further provides that it is not to be construed to impair or supersede other Federal laws, including regulations issued under such laws.65 Courts have held that ERISA’s requirement to comply with the terms of the plan must not be construed to invalidate or impair section 1557.66 63 Franciscan All., 553 F. Supp. 3d at 378. U.S.C. 1104(a)(1)(D) (‘‘[A] fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries and . . . in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of this subchapter and subchapter III.’’). 65 29 U.S.C. 1144(d) (‘‘Nothing in this subchapter shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States (except as provided in sections 1031 and 1137(b) of this title) or any rule or regulation issued under any such law.’’). 66 See, e.g., C. P. by & through Pritchard v. Blue Cross Blue Shield of Ill., No. 3:20–CV–06145–RJB, 2022 WL 17788148, at *8, 10 (W.D. Wash. Dec. 19, 2022) (holding that ERISA’s requirement at 29 U.S.C. 1104(a)(1)(D) to administer a plan’s terms as written ‘‘is subservient to Section 1557, outlawing discrimination, which is dominant’’); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. Minn. 2018) (‘‘The Court will not construe ERISA to impair Section 1557. Nothing in Section 1557, explicitly or implicitly, suggests that TPAs are exempt from the statute’s nondiscrimination requirements.’’). 64 29 PO 00000 Frm 00029 Fmt 4701 Sfmt 4700 37549 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.5, without modification. Remedial Action and Voluntary Action (§ 92.6) In § 92.6, OCR proposed to include requirements regarding remedial and voluntary action, which would reinstate former § 92.6 in the 2016 Rule and is consistent with parallel requirements in the implementing regulations for section 504, title IX, and the Age Act. The 2020 Rule does not include a similar provision. In § 92.6(a)(1) of the 2022 NPRM, we proposed requiring recipients or State Exchanges that have been found by the Director to have engaged in discriminatory conduct in their health programs and activities in violation of this part to take voluntary actions to remediate the effects of such discriminatory conduct. Similarly, we proposed that under § 92.6(a)(2), where a recipient exercises control over another recipient that has discriminated, the Director may require either or both entities to take remedial action. Under proposed § 92.6(a)(3), a recipient or State Exchange must take remedial action if OCR requires such action to redress the harm experienced by an individual who was subjected to prohibited discrimination. Under proposed § 92.6(b), a covered entity may voluntarily take nondiscriminatory steps to overcome the effects of the conditions that limited an individual’s ability to participate in a health program or activity based on their race, color, national origin, sex, age, or disability. The comments and our responses regarding § 92.6 are set forth below. Comment: Commenters generally supported the requirement that a recipient remedy instances of confirmed discrimination and the voluntary action provision that allows for covered entities to address effects of past discrimination. One commenter recommended that we limit the application of this provision to avoid exposing recipients to unfair and specious claims of discrimination. Specifically, the commenter suggested that the remedial action be limited to: (1) individuals who applied to participate in a health program or activity but were unable to participate due to alleged discrimination; or (2) individuals who had been participants in a health program or activity but are no longer participants due to alleged discrimination. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37550 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Response: This provision is an essential tool in remediating findings of discrimination and encouraging recipients to take voluntary actions to overcome potential discrimination. The suggested revisions to § 92.6 are unnecessary, as they generally request implementing conditions that are already present. For example, § 92.6(a)(1) requires remedial action by a recipient or State Exchange only after a finding of discrimination. Section 92.6(a)(3) limits any required remedial action in the spirit of the commenter’s recommendation, namely providing that recipients and State Exchanges take remedial action with respect to individuals who were or would have been participants in the health program or activity had the discrimination not occurred. Covered entities are prohibited from discriminating and as such should take steps to ensure nondiscrimination, even in the absence of a finding of discrimination by OCR. Where a covered entity has identified conditions that currently or in the past had resulted in limited participation in their health programs and activities by individuals protected by this rule, they are encouraged to take the voluntary action contemplated in § 92.6(b). We also note that regulations for section 504, title IX, and the Age Act require recipients to take remedial action, and recipients have complied with the remedial action provisions in those civil rights statutes for more than 40 years.67 For example, where there is a finding that a recipient engaged in disability discrimination, the recipient’s remedial action to overcome the effects of the disability discrimination would likely satisfy this provision’s remedial action requirement as well as section 504’s remedial action requirement at 45 CFR 84.6(a). Comment: Another commenter expressed concern about the obligation this provision places on a recipient that exercises control over another recipient that is found to have engaged in discrimination prohibited by section 1557. The commenter recommended that OCR revise the provision so that only the recipient that OCR found to have engaged in unlawful discrimination (and not the controlling entity) take remedial action and that OCR enumerate specific remedial actions OCR may require and the circumstances under which OCR may require them. Response: The word ‘‘control’’ has appeared in civil rights regulations 67 See 45 CFR 84.6(a) and (b) (section 504); 86.3(a) and (b) (title IX); and 91.48 (Age Act). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 enforced by OCR for many years, and its meaning has been established over time. As we explained in the preamble for the 2016 Rule, OCR’s experience and the longstanding approach for controlling entities to secure appropriate action from discriminating entities over which they have control has played an important role in remedying discrimination. 81 FR 31393. Given that nothing has changed in OCR’s experience in the intervening years regarding the principles of ‘‘control’’ as applied here, we decline to define the term ‘‘control.’’ While we appreciate the commenter’s request to list the remedial actions OCR may require of a recipient or State Exchange found in violation of this part, the remedial actions that a recipient or State Exchange must take to address confirmed discrimination will be subject to the facts involved in a particular case. A review of past resolution agreements provides useful, though not exhaustive, examples of the variety of means by which OCR achieves corrective action.68 Comment: One commenter recommended that OCR revise § 92.6 to require a recipient or State Exchange to notify participants, enrollees, and beneficiaries of any finding of discrimination by the Director and the remedial action the recipient has taken or will take to address the confirmed discrimination. Response: We recognize the benefit that notice of confirmed discrimination and the steps a recipient or State Exchange will take to remedy the discrimination can provide to participants, enrollees, and beneficiaries. While we encourage recipients and State Exchanges to provide notice to participants, we decline to require they do so. Current Federal civil rights regulations with similar remedial and voluntary action provisions do not include a notice requirement, and we do not believe imposing such a requirement on recipients and State Exchanges is warranted at this time. We note, however, it is OCR’s practice to notify the public via a press release or posting on our website when a violation has been found or a resolution has been reached.69 Additionally, OCR has established a Civil Rights listserv to 68 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Recent Civil Rights Resolution Agreements & Compliance Reviews, https:// www.hhs.gov/civil-rights/for-providers/complianceenforcement/agreements/. 69 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Civil Rights News Releases & Bulletins, https://www.hhs.gov/civil-rights/newsroom/ index.html. PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 inform the public about civil rights settlement and enforcement activities, press releases, FAQs, guidance, and technical assistance materials. To subscribe to OCR’s Civil Rights listserv, please visit https://list.nih.gov/cgi-bin/ wa.exe?SUBED1=OCR-CIVILRIGHTSLIST&A=1. Comment: One commenter recommended that, for § 92.6(b) (voluntary action), we replace ‘‘may’’ with ‘‘must’’ to require covered entities to take nondiscriminatory steps to overcome effects that result or resulted in limiting participants ability to participate in the covered entity’s health program or activities based on the participants’ race, color, national origin, sex, age, or disability. Response: Such a revision would alter the voluntary nature of the provision, which encourages covered entities to take nondiscriminatory steps on their own accord to make their programs more inclusive absent a finding of discrimination. We note that, when there is a finding that prohibited discrimination occurred, § 92.6(a) mandates the offending recipient or State Exchange to take action to remedy such discrimination. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.6, without modification. Designation and Responsibilities of a Section 1557 Coordinator (§ 92.7) In proposed § 92.7(a), OCR proposed requiring covered entities with 15 or more employees to designate at least one employee to serve as a Section 1557 Coordinator (‘‘Coordinator’’) to coordinate their efforts to comply with and carry out the covered entity’s responsibilities under section 1557 and the part. OCR also proposed to permit covered entities to, as appropriate, assign one or more designees to carry out some of the responsibilities of the Coordinator. In § 92.7(b), we proposed a list of responsibilities of the Coordinator. We invited comment on this requirement, including whether OCR should require covered entities with fewer than 15 employees to designate a Coordinator and, if so, whether there should be a requisite number of employees or whether all covered entities should be required to designate a Coordinator. We further sought comment on whether the enumeration of responsibilities of the Coordinator is beneficial and sufficiently comprehensive. We also requested comment on how the E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Department can support Coordinators, including through the provision of training, so that they understand their duties, the protections afforded by section 1557, and the rationales for both. The comments and our responses regarding § 92.7 are set forth below. Comment: Commenters on this provision overwhelmingly supported the Coordinator requirement at § 92.7. A number of supportive commenters indicated that civil rights violations often occur due to ignorance, neglect, and administrative indifference, and Coordinators will equip providers with critical civil rights knowledge and the ability to recognize and adequately care for patients at risk for poor health outcomes. Other commenters similarly emphasized that the Coordinator requirement will equip covered entities with an internal resource dedicated to section 1557 implementation and compliance, and that this is especially critical for small covered entities and covered entities in rural communities. Commenters cited a number of other reasons for their support of the Coordinator requirement, including that having a Coordinator will help covered entities proactively protect civil rights; will provide central points of contact for language access; and will allow covered entities and OCR to better identify patterns or practices of discrimination, which will aid covered entities in delivering effective and efficient care. One commenter expressed concern about the possibility that Coordinators evolve and become ineffective by privileging the institutions they serve rather than appropriately conducting thorough investigations of grievances. Relatedly, another commenter recommended that OCR revise § 92.7 to require covered entities’ Coordinators to be independently minded or independent from the covered entity to ensure impartiality and transparency and to require that Coordinators be able to work independently. Many of these commenters cited the COVID–19 Public Health Emergency as a reason for their support of the Coordinator requirement. Specifically, they stated that the health outcomes resulting from the COVID–19 pandemic highlighted covered entities’ ignorance of civil rights regulations with respect to individuals from marginalized communities. Response: We agree with commenters regarding the myriad benefits of the Coordinator requirement, particularly with regard to increasing covered entities’ ability to proactively prevent discrimination before it happens and hopefully more thoroughly address it VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 when it does. Coordinators are expected to perform their impartially, which will also benefit covered entities through ensuring compliance with section 1557. OCR appreciates commenters’ concerns that Coordinators be sufficiently independent from a covered entity to ensure impartiality and transparency. We note that a covered entity may run the risk of noncompliance with section 1557 if an investigation reveals that its Coordinator did not carry out their obligations under section 1557 in an impartial manner. By having a Coordinator, with specific compliance responsibilities, OCR expects that covered entities will be cognizant of the importance of compliance with civil rights requirements, including in times of public health emergencies or other crises. Comment: Other commenters opposed the Coordinator requirement, contending that it will increase the burdens covered entities will face. One commenter reiterated the 2020 Rule’s reasoning for eliminating the Coordinator requirement by stating that regulations for underlying civil rights statutes requiring coordinators is sufficient for section 1557 enforcement. Another commenter stated covered entities can meet section 1557 compliance obligations without a Coordinator. Yet another commenter recommended that OCR instead encourage practices to adopt a collaborative approach where all staff take an active role in ensuring nondiscrimination. Response: The role of the Coordinator is to promote effective and efficient implementation of section 1557 and the part, and in so doing decrease compliance inefficiencies and promote meaningful investigations of allegations of potential civil rights violations. OCR remains confident that the benefits to a covered entity and the public of the Coordinator requirement outweigh any potential burdens. Time spent coordinating a covered entity’s section 1557 compliance program is an investment that will likely result in improved, nondiscriminatory health care delivery and saving resources otherwise spent responding to potential OCR investigations and private litigation. Even if a covered entity is subject to a civil rights complaint or litigation, its Coordinator’s presence and active coordination efforts may enable the covered entity to more quickly resolve a complaint or litigation. This rule addresses the confusion that the 2020 Rule creates surrounding the extent to which covered entities were required to maintain a Coordinator for PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 37551 purposes of section 1557 compliance. The 2020 Rule does not clarify, for example, whether a covered entity’s existing section 504 coordinator—whose role relates to ensuring a recipient’s efforts to comply section 504 alone, per 45 CFR 84.7—must also ensure the covered entity’s compliance with section 1557’s prohibition of discrimination based on race, color, national origin, age, or sex. OCR is providing for a specific Section 1557 Coordinator, rather than relying on the requirements found in the implementing regulations for the referenced statutes, to resolve any confusion as to covered entities’ responsibilities. Comment: Some commenters requested that OCR clarify that Coordinators are responsible for covered entities’ internal section 1557 oversight and that covered entities may have other staff members implement various Coordinator activities. These commenters recommended that OCR revise § 92.7(b) to add ‘‘or designee’’ after ‘‘Section 1557 Coordinator’’ to confirm that one or more staff can assist the Coordinator with the enumerated Coordinator responsibilities. Some commenters requested clarity about whether a covered entity’s Coordinator can also serve in other capacities within the covered entity’s organization, and whether the Coordinator requirement obligates covered entities to hire a new employee to serve as a Coordinator, and if so, whether the job description must list all of the Coordinator responsibilities enumerated at § 92.7(b). Response: Section 92.7(a) expressly states that a covered entity may assign one or more designees to assist the Coordinator in carrying out their responsibilities. However, the Coordinator must retain ultimate oversight for ensuring the covered entity’s compliance with this part. In general, it is the covered entity’s prerogative to designate any qualified individual to serve as its Coordinator. A covered entity does not need to hire a new employee for the role, and the Coordinator may serve in other capacities and have responsibilities in addition to their Coordinator responsibilities at § 92.7(b); so long as those responsibilities do not create a conflict of interest or otherwise prevent the Coordinator from effectively carrying out their responsibilities. Comment: Some commenters recommended that OCR not require covered entities to list a Coordinator’s name and contact information in their publicly available Notice of Nondiscrimination because of the constant need to update Coordinators’ E:\FR\FM\06MYR4.SGM 06MYR4 37552 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 names and contact information due to turnover and to avoid potential harassment from section 1557 opponents. Instead, these commenters requested that OCR allow covered entities to list the Section 1557 Coordinator job title instead of an individual’s name. Response: OCR appreciates the challenges associated with updating specific contact information; for this reason, nothing in § 92.8 (Policies and procedures) or § 92.10 (Notice of nondiscrimination) require covered entities to include a Coordinator’s name. As proposed, and finalized, §§ 92.8(b) and 92.10(a)(1)(v) both require ‘‘contact information’’ for the Coordinator; providing the job title rather than an individual’s name is sufficient to meet this requirement. However, contact information in the form of a phone number, email address, and mailing address must also be provided. A covered entity may establish a general phone number, email address, and/or mailing address to meet this requirement. Absent this information, individuals who need to reach the Coordinator will have no knowledge of how to do so. While this rule does not apply to employment practices, as discussed in § 92.2(b), employees of covered entities remain protected against retaliation as provided in §§ 92.303 and 92.304. If a covered entity’s staff is harassing the Coordinator because of the Coordinator’s job responsibilities, the covered entity should take appropriate measures to address the harassment, and, if the harassment is based on one or more characteristics protected by the Federal laws enforced by the EEOC, the Coordinator may file a charge of discrimination with the EEOC at https:// www.eeoc.gov/filing-chargediscrimination.70 If staff, including a covered entity’s Coordinator, are being threatened by other covered entity staff or by individuals external to the covered entity, we strongly encourage reporting these threats to the FBI at 1–800–225– 5324 or via www.fbi.gov/tips. Comment: One commenter requested that OCR clarify whether a large health system made up of several covered entities can have a single Coordinator for the entire health system or whether each covered entity needs to have its 70 The EEOC is responsible for enforcing Federal laws that make it illegal to discriminate against an employee because of the person’s race, color, religion, sex (including pregnancy, childbirth or related medical conditions, gender identity, and sexual orientation), national origin, age (40 or older), disability or genetic information. See U.S. Equal Emp. Opportunity Comm’n, Overview, https://www.eeoc.gov/overview. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 own Coordinator. Another commenter stated that it is impossible for one Coordinator to oversee section 1557 compliance for an entire large health care system, with another suggesting that there should be at least one Coordinator for every 250 employees for covered entities with 500 or more employees. Response: In order to provide covered entities with flexibility, OCR clarifies that large health systems may customize their Coordinator and designee configurations as long as each individual covered entity has either a Coordinator or designee responsible for section 1557 compliance. Because a covered entity is better positioned to determine how to ensure that the coordinator(s) can effectively perform all of their duties, we decline to revise the Coordinator requirement so that a covered entity is required to designate one Coordinator for every 250 employees. Comment: A significant number of commenters recommended that all covered entities, regardless of size, have a Coordinator because ensuring section 1557 compliance is integral to providing nondiscriminatory health care services. Another commenter noted that the requirement aligns with the Joint Commission’s recent standards requiring accredited hospitals and similar facilities to designate an individual to lead activities to reduce health disparities. Several commenters stated that the 15-employee threshold is arbitrary, arcane, and inconsistent with protecting civil rights to the maximum extent possible. Others stated the position is critical for smaller covered entities that provide services to individuals with disabilities, particularly in rural and low-income communities, and for covered entities that provide long-term services and supports to older adults and people with disabilities who use home and community-based services. Others referenced that smaller covered entities include mental health providers, social workers, psychologists, counselors, and family and marriage therapists. One commenter suggested that covered entities with fewer than 15 employees could still voluntarily designate a Coordinator. Response: OCR appreciates comments received regarding the application of the Coordinator provision. While all covered entities, regardless of size, would benefit from having a dedicated Coordinator on staff, we decline to extend the requirement to all covered entities beyond those with 15 or more employees, in an effort to reduce PO 00000 Frm 00032 Fmt 4701 Sfmt 4700 unnecessary or counterproductive administrative obligations on small providers. OCR does not find this limitation to be arbitrary, as it is consistent with section 504’s coordinator requirement, 45 CFR 84.7(a), and was also included in the 2016 Rule at former § 92.7. We note that covered entities with fewer than 15 employees retain the option of designating a Coordinator. Comment: Other commenters thought the 15-employee threshold was appropriate, and that applying the requirement to smaller entities would result in burdens and costs for small and solo practices. Another commenter recommended increasing the employee threshold so that only covered entities with 50 or more employees be required to designate a Coordinator. Another commenter recommended that covered entities that fall within the Small Business Association’s (SBA) classification 71 of a small business not be required to designate a Coordinator. Another commenter recommended that the Coordinator requirement be removed altogether. Response: The Coordinator requirement is a vital step in encouraging proactive civil rights compliance; therefore, OCR declines to remove this provision. We also decline to increase the employee threshold for the Coordinator requirement to 50 or more employees. Though the coordinator requirement in title II of the ADA is limited to public entities with 50 or more employees, 28 CFR 35.107, the 15-employee threshold in section 504 is more appropriate for section 1557. Section 504 covered entities are more analogous to section 1557 covered entities given that they are recipients of Federal financial assistance of all sizes; ADA title II covered entities, however, are all State or local governments. For similar reasons, we believe that that the SBA classification of a small business— which was set in a very different context serving very different purposes—is inappropriate for this rule. Comment: Some commenters requested additional clarity about the 15-employee threshold. For example, commenters asked whether part-time, contractor, and sub-contractor employees would count toward a covered entity’s employee total or if 71 U.S. Small Business Ass’n, Basic Requirements: Meet Size Standards, https://www.sba.gov/federalcontracting/contracting-guide/basicrequirements#section-header-6 (The SBA assigns a size standard to each NAICS code. Most manufacturing companies with 500 employees or fewer, and most non-manufacturing businesses with average annual receipts under $7.5 million, will qualify as a small business.). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations only full-time employees would count. One commenter suggested that, without this clarification, some covered entities will engage in hiring and human resources practices that undermine and abuse the 15-employee threshold. Another commenter also sought to clarify whether only clinical staff should count toward the 15-employee threshold and whether administrative staff should count as well. Response: With respect to the employees who will count towards the 15 or more-employee threshold, OCR will consider the total number of individuals employed by a covered entity. This includes full-time and parttime employees and independent contractors. All employees, regardless of job classification (e.g., clinical versus clerical), will count toward the threshold. We intend for this clarification to reduce concerns that the 15-employee threshold may lead to questionable employment practices. Comment: One commenter indicated that the Coordinator requirement implicates religiously affiliated covered entities’ authority to hire people who share their religious beliefs because requiring religiously affiliated covered entities to have a Coordinator may compromise the religiously affiliated covered entity’s religious beliefs if its Coordinator has fundamentally different beliefs or viewpoints. Response: Nothing in the regulatory text requires a covered entity to designate a Coordinator with a particular viewpoint or particular beliefs. No part of this final rule prevents a religiously affiliated recipient from designating or hiring an employee who shares the entity’s religious beliefs as its Coordinator, provided that the individual is qualified to effectively and impartially perform the role required by the regulation. In addition, where title VII applies to a recipient’s employment and hiring decisions, section 1557 does not interfere or otherwise conflict with requirements or protections afforded under title VII. Comment: Several commenters supported the 2022 NPRM’s inclusion of an enumerated list of Coordinator responsibilities at § 92.7(b). Many of these commenters appreciate the flexibility for covered entities to spread or delegate responsibilities to one or more designees within a covered entity’s organization. Some commenters requested that OCR consider revising § 92.7(b) to add an additional responsibility that Coordinators coordinate with other covered entities, as necessary, to ensure that individuals who are interacting with multiple entities receive the required language VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 assistance services and/or auxiliary aids and services. A different commenter felt that the enumerated list of Coordinator responsibilities at § 92.7(b) is too prescriptive and recommended that OCR allow each covered entity the opportunity to determine their Coordinator’s responsibilities. Response: The responsibilities enumerated at § 92.7(b) provide a baseline for expected duties while allowing covered entities the flexibility, discretion, and ability to structure responsibility for such duties to their Coordinator(s) or designee(s). A covered entity may assign duties beyond those enumerated at § 92.7(b), at its discretion. With respect to situations where two covered entities are interacting with the same individual with LEP, individual with a disability, or individual with a disability with LEP, both covered entities are responsible for ensuring that individuals receive the appropriate language assistance services and/or auxiliary aids and services required by this rule under §§ 92.201 and 92.202. Some agencies may find that coordination between their Section 1557 Coordinators will help to more effectively meet the needs of these individuals, but OCR declines to implement a requirement to this effect as each covered entity has an obligation under this part regardless of what services they believe another covered entity may be providing. Comment: Another commenter recommended that a covered entity’s Coordinator not handle section 1557 grievances given that a covered entity may have an existing grievance collection point, which allows it to quickly address grievances through existing structures. A different commenter recommended that OCR clarify that a covered entity can assign Coordinator responsibilities to a group or division instead of one or more specific individuals because organizations may already have individuals specifically trained and responsible for ensuring nondiscrimination. Response: These regulations do not prohibit a Coordinator from working within existing organizational structures that receive and investigate grievances or perform other Coordinator responsibilities identified in § 92.7(b). As discussed above, this provision provides a covered entity wide latitude to designate one or more Coordinator(s) and to assign one or more designee(s) to assist the Coordinator with their responsibilities, including collecting and addressing grievances. A covered entity may also assign Coordinator responsibilities to a group or division, PO 00000 Frm 00033 Fmt 4701 Sfmt 4700 37553 provided that the covered entity identifies an individual Coordinator who retains ultimate oversight for coordinating section 1557 compliance. Comment: One commenter recommended that OCR make clear that, when performing their grievance responsibilities, the Coordinator is required to collect specific data, including: alleged basis or bases of discrimination; the date the grievance was filed; the date of the alleged discriminatory action; and the grievance resolution. This commenter indicated that this data should not include individually identifying information and indicated that the covered entity, through the Coordinator, should be responsible for the privacy of the data that they collect while fulfilling their coordinator role. A different commenter recommended that OCR require Coordinators to review grievance data in order to identify potential and actual discriminatory trends. Response: OCR appreciates the commenter’s suggestion regarding the data that must be retained for each grievance. However, we decline to include these details here as the data points the commenter suggested are already in § 92.8(c)(2), which discusses the information that must be retained in grievance records. Although this final rule does not require covered entities to collect data on trends across the organization, we highly encourage all Coordinators to review grievance data to identify and address any potential and actual discriminatory trends revealed in such data. We discuss this in greater detail at § 92.8(c) (grievance procedure). Comment: Multiple commenters requested that OCR provide training and other resources to help covered entities implement the Coordinator requirement. Some commenters requested that OCR provide (1) training for people who are new to the Coordinator role and for providers who are updating the role; (2) facts sheets to introduce section 1557 to the Coordinator and other staff throughout the organization; and (3) checklists that can be consulted and used to confirm the Coordinator’s responsibilities. One commenter requested that OCR training for Coordinators include civil rights, cultural, and implicit bias training. Response: OCR commits to serve as a resource and partner with covered entities that need help regarding their Coordinator obligations. As discussed in further detail at § 92.8 (Policies and procedures), we plan to make various resources available to assist Coordinators with their responsibilities. Comment: One commenter asked how OCR will audit covered entities’ E:\FR\FM\06MYR4.SGM 06MYR4 37554 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations compliance with the Coordinator requirement and whether the Coordinator post will be eligible for the Federal matching rate as an administrative activity under section 1903(a)(7) of the Social Security Act. Response: Consistent with current practice, OCR will determine a covered entity’s compliance with the Coordinator requirement during complaint investigations and affirmative compliance reviews. With regard to the commenter’s inquiry regarding the availability of Federal financial participation under section 1903(a)(7) of the Social Security Act, 42 U.S.C. 1396b(a)(7), OCR does not administer Medicaid and therefore this comment is outside of the scope of this rulemaking. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.7, without modification. Policies and Procedures (§ 92.8) At § 92.8 of the 2022 NPRM, OCR proposed requiring covered entities to develop and implement written policies and procedures that are designed to facilitate compliance with the requirements of the part. We proposed requiring each covered entity, in its health programs and activities, to adopt and implement a nondiscrimination policy, grievance procedures (for covered entities employing 15 or more persons), language access procedures, auxiliary aids and services procedures, and procedures for reasonable modifications for individuals with disabilities (collectively, ‘‘Section 1557 Policies and Procedures’’). In § 92.8(a), we proposed a general requirement for covered entities to implement written Section 1557 Policies and Procedures. The policies and procedures must include an effective date and be reasonably designed, taking into account the size, complexity, and the type of health programs or activities undertaken by a covered entity, to ensure compliance with the part. In § 92.8(b), we proposed requiring each covered entity to implement a written nondiscrimination policy that, at minimum, provides the contact information for the Section 1557 Coordinator (if applicable) and states that the covered entity in its health programs and activities: is prohibited from unlawfully discriminating on the basis of race, color, national origin (including limited English proficiency and primary language), sex (including pregnancy, sexual orientation, gender VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 identity, and sex characteristics), age, or disability; and provides language assistance services and appropriate auxiliary aids and services free of charge, when necessary for compliance with section 1557 or the part. In § 92.8(c), we proposed addressing the requirements for covered entities with 15 or more employees with regard to grievance procedures and recordkeeping in their health programs and activities, including ensuring that the grievance procedure is accessible to individuals with LEP and individuals with disabilities. In § 92.8(c)(1), we proposed requiring that covered entities with 15 or more employees establish written civil rights grievance procedures. In § 92.8(c)(2), we proposed that a covered entity must retain records related to grievances filed with it that allege discrimination on the basis of race, color, national origin, sex, age, or disability in its health programs and activities for no less than three (3) years from the date of the filing of the grievance. In § 92.8(c)(3), we proposed that a covered entity keep confidential the identity of an individual who has filed a grievance, except as required by law or to the extent necessary to carry out the purposes of this proposed regulation, including the conduct of any investigation. We invited comment on the record retention requirement, particularly with regard to patient privacy concerns or concerns regarding potentially unauthorized use of information included in such records. We also sought comment on best practices for record retention of grievance procedures, including strategies for ensuring patient privacy. In § 92.8(d), we proposed requiring covered entities to develop and implement written language access procedures to support compliance with requirements to take reasonable steps to provide meaningful access to individuals with LEP in their health programs and activities under proposed § 92.201. In § 92.8(e), we proposed requiring covered entities to develop and implement written effective communication procedures to support compliance with requirements to take appropriate steps to ensure that communications in their health programs and activities with individuals with disabilities are as effective as communications with individuals without disabilities under proposed § 92.202. In § 92.8(f), we proposed requiring covered entities to develop and PO 00000 Frm 00034 Fmt 4701 Sfmt 4700 implement written procedures for making reasonable modifications to their policies, practices, or procedures that allow individuals with disabilities equal opportunity to participate in their health programs and activities as required under proposed § 92.205. In § 92.8(g), we proposed that a covered entity may combine the content of the policies and procedures required by this provision with any policies and procedures pursuant to other civil rights statutory protections if they clearly comply with section 1557 and the provisions in the part. We sought comment on this proposed provision and whether there may be alternative measures that OCR should consider to proactively prevent discrimination, and whether they would be more or less burdensome than what was proposed. We also invited comment from all covered entities that had previously implemented or were currently implementing any of the proposed procedures; consumers who interact with covered health programs and activities; and community-based organizations that work with individuals with LEP and individuals with disabilities. We also requested comment on whether covered entities employing fewer than 15 people should be required to have a grievance procedure, including the benefits of a less formal resolution process. The comments and our responses regarding § 92.8 are set forth below. General Comments Comment: Many commenters expressed support for the Section 1557 Policies and Procedures requirement at § 92.8, noting that, in their view, it will help prevent discrimination and health disparities; requires providers to proactively engage in the process of avoiding discrimination; elevates covered entities and their employees’ knowledge about their section 1557 obligations; and alleviates the burden on patients to file complaints in order to trigger section 1557 compliance and enforcement. Some commenters supported the requirement because the 2020 Rule leaves requirements for policies and procedures disjointed, confusing, and ineffective. Some commenters recommended that OCR strengthen this requirement by requiring covered entities to evaluate the effectiveness of their Section 1557 Policies and Procedures and update them when necessary to ensure consistency. Response: Covered entities’ Section 1557 Policies and Procedures should be dynamic and updated to ensure covered entities comply with changes in the law E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations and meet their section 1557 obligations. In addition, when covered entities’ operations change, this may necessitate revising Section 1557 Policies and Procedures to maintain section 1557 compliance. Accordingly, we have added § 92.8(h) to address when it is required and permissible for a covered entity to revise their Section 1557 Policies and Procedures. Section 92.8(h)(1) explains that a covered entity must review and revise its policies and procedures, as necessary, to ensure they are current and in compliance with section 1557 and this rule. Section 92.8(h)(2) states that a covered entity may change its policies and procedures at any time, provided that the changed policies comply with section 1557 and the part. Comment: Some commenters who opposed this requirement cited covered entities’ existing compliance burdens and the resources needed to draft Section 1557 Policies and Procedures. Some commenters requested that, if OCR maintains the requirement in the final rule, OCR make template Section 1557 Policies and Procedures available for covered entities to use and tailor to their organizations as far in advance of the final rule’s effective date as possible. One commenter stated that existing Federal and State regulations prevent covered entities from focusing on highquality care, and that this requirement is an unfunded mandate. One commenter recommended that OCR should continue previously permitted flexibility and allow covered entities to develop Section 1557 Policies and Procedures voluntarily. Response: To assist covered entities’ compliance with this requirement, OCR has developed Section 1557 Policies and Procedures templates that are available on OCR’s website at www.hhs.gov/1557, which are designed to assist covered entities in tailoring their own Section 1557 Policies and Procedures. We reiterate the requirement that a covered entity’s Section 1557 Policies and Procedures must be reasonably designed, take into account a covered entity’s size, complexity, and the type of health programs or activities provided. A covered entity should view these templates as a starting point for adopting and implementing Section 1557 Policies and Procedures that are specific to their health programs and activities. The templates provided may be insufficient for large covered entities given the range in complexity and structure of those entities, and entities must ensure that their Section 1557 Policies and Procedures reflect the appropriate scope. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Comment: Some commenters recommended that OCR not require covered entities to identify the names of their respective Coordinators in their Section 1557 Policies and Procedures required by § 92.8(b), (d), (e), and (f) because high employee turnover may make coordinators’ names obsolete and require constant changes. Response: OCR notes that nothing in § 92.8 requires a covered entity to identify the Coordinator by name; rather, § 92.8(b), (d), (e), and (f) require the Coordinator’s current contact information. The referenced provisions require sufficient information for an individual who needs assistance in implementing the procedures to reach the Coordinator. Thus, a covered entity could choose to list the position title with a phone number, email address, and mailing address. Comment: One commenter requested that OCR clarify, especially with respect to large health systems (such as hospitals, clinics, home care entities, and home medical equipment retail settings), the regulatory language related to scalability. Response: OCR recognizes that covered entities—including not only recipients, but also the Department and title I entities—need flexibility when developing and implementing their Section 1557 Policies and Procedures. A covered entity should consider its size, capabilities, the costs of specific measures, the operational impact, and the composition of the patient populations they serve in deciding the appropriate scale of their Section 1557 Policies and Procedures. Thus, OCR expects the scope and detail of a covered entity’s Section 1557 Policies and Procedures to vary accordingly. Comment: Some commenters requested that OCR include additional required policies and procedures, such as policies and procedures regarding service animals, protecting civil rights in public health emergencies, assessing the competency of bilingual/ multilingual staff, and telehealth. Specifically, one commenter recommended requiring a telehealth procedure designed to assist covered entity employees communicate with patients before, during, and after telehealth visits, and that this telehealth procedure could address preappointment telehealth screenings to ensure that patients have the necessary equipment or technology for their appointments and to determine whether the patient has the requisite technological skills to participate in a telehealth session. The proposed telehealth procedure would require covered entities to provide telehealth PO 00000 Frm 00035 Fmt 4701 Sfmt 4700 37555 training resources for patients who lack skills or familiarity with telehealth prior to their appointments. Other commenters recommended that covered entities’ procedures ensure accessibility for individuals with physical and/or behavioral health disabilities and specifically comply with the U.S. Access Board’s Standards for Accessible Medical Diagnostic Equipment. 82 FR 2810 (Jan. 9, 2017). Response: OCR recognizes the benefit of policies and procedures to support civil rights compliance. However, we recognize that developing and implementing such policies and procedures is not without an initial burden on the covered entities, and the continued—though much diminished— effort of maintaining the procedures and employee familiarity with such procedures. For that reason, we decline to require additional policies and procedures at this time. However, covered entities are encouraged to develop and implement policies and procedures related to service animals, protecting civil rights during public health emergencies, assessing bilingual and multilingual staff members’ competency, nondiscriminatory provision of telehealth,72 accessible medical equipment, or any other situation they choose in order to ensure compliance with section 1557. For more about section 1557’s accessibility requirements, please refer to our discussion for § 92.204, which requires covered entities to make their buildings and facilities accessible to individuals with disabilities. In addition, please see the discussion of medical diagnostic equipment under § 92.207. Please also see the discussion of § 92.211 related to nondiscrimination in the delivery of health programs and activities through telehealth services. Summary of UUegulatory changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the policies and procedures requirement provision at § 92.8 as proposed, with modifications. We have added a paragraph (h) that explains that a covered entity must review and revise its policies and procedures, as necessary, to ensure they are current and in compliance with section 1557 and this rule and that a covered entity 72 See, e.g., U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts.; U.S. Dep’t of Justice, Civil Rts. Div., Guidance on Nondiscrimination in Telehealth: Federal Protections to Ensure Accessibility to People with Disabilities and Limited English Proficient Persons, https://www.hhs.gov/sites/ default/files/guidance-on-nondiscrimination-intelehealth.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 37556 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 may change its policies and procedures at any time, provided that the changed policies comply with section 1557 and this rule. Nondiscrimination Policy Comment: Many commenters supported the Nondiscrimination Policy at proposed § 92.8(b). Some commenters recommended that OCR revise the language in this Policy so that the description of prohibited sex discrimination is consistent with the description of sex discrimination included in § 92.101 (i.e., revise to include sex stereotypes and pregnancy or related conditions). Some of these commenters further recommended that OCR also specify that ‘‘pregnancy or related conditions’’ includes termination of pregnancy. Other commenters requested that OCR further revise § 92.8(b)’s reference to sex discrimination and make a corresponding revision to § 92.101(a)(2) by adding ‘‘transgender status’’ to the description of sex discrimination for both provisions. Response: OCR appreciates the need for consistency across the regulation, and to ensure that the public is aware of the various types of discrimination included under the umbrella of sex discrimination. We clarify that a Nondiscrimination Policy’s prohibition of sex discrimination encompasses protections afforded for various types of sex discrimination such as pregnancy, including termination of pregnancy or related conditions, and we have revised the parenthetical in § 92.8(b) to explain that this provision’s reference to sex discrimination is consistent with the various types of sex discrimination described at § 92.101(a)(2), which includes ‘‘gender identity.’’ We decline to add ‘‘transgender status’’ to the regulatory text, as the term ‘‘gender identity’’ necessarily encompasses ‘‘transgender status’’ and these terms are often used interchangeably.73 At the same time, we want to emphasize that the ACA itself provides that ‘‘[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 73 See, e.g., Bostock v. Clayton Cnty., Georgia, 590 U.S. 644, 658–59 (2020); Doe v. Mass. Dep’t of Correction, No. CV 17–12255–RGS, 2018 WL 2994403 (D. Mass. June 14, 2018); Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034 (7th Cir. 2017). VerDate Sep<11>2014 22:34 May 03, 2024 Jkt 262001 18023(c)(2)(A). HHS will comply with this provision.74 For further discussion regarding what constitutes sex discrimination, including the application of religious freedom and conscience protections in this context, please see the discussion at § 92.101(a)(2). Comment: One commenter expressed opposition to § 92.8(b) because it would increase paperwork without benefiting or improving the quality of care. Response: As we noted above, many commenters, some of which are providers and professional medical associations, support the requirement to have a Nondiscrimination Policy. Peerreviewed medical publications acknowledge that a health care organization’s written policies and procedures can improve quality of care and mitigate the legal risk of causing patient harm.75 Indeed, research suggests that the mere existence of policies that prohibit discrimination helps reduce health and other inequities.76 Thus, we disagree with the commenter’s contention that § 92.8(b) increases paperwork without benefitting or improving quality of care particularly for individuals who belong to communities with a history of 74 The application of this final rule to covered entities with religious freedom or conscience objections is discussed more fully below in §§ 92.3 (Relationship to other laws) and 92.302 (Notification of views regarding application of Federal religious freedom and conscience laws). 75 See James O’Donnell et al., Policies and Procedures: Enhancing Pharmacy Practice and Limiting Risk, 37 Health Care & L. 341 (2012), https://www.ncbi.nlm.nih.gov/pmc/articles/ PMC3411206/; Savithiri Ratnapalan et al., Organizational Learning in Health Care Organizations, 2 Systems 24–33 (2014), https:// www.mdpi.com/2079-8954/2/1/24. 76 See generally Douglas Almond & Kenneth Chay, Civil Rights, The War on Poverty, and BlackWhite Convergence in Infant Mortality in the Rural South and Mississippi, Mass. Inst. of Tech., Dep’t of Economics, Working Paper Series, SSRN, (2007), https://papers.ssrn.com/sol3/papers.cfm?abstract_ id=961021; Doughlas Almond & Kenneth Chay, The Long-Run and Intergenerational Impact of Poor Infant Health: Evidence from Cohorts Born During the Civil Rights Era, Nat’l Bureau of Econ. Rsch (2006), https://users.nber.org/∼almond/chay_npc_ paper.pdf; Nancy Krieger et al., The Unique Impact of Abolition of Jim Crow Laws on Reducing Inequities in Infant Death Rates and Implications for Choice of Comparison Groups in Analyzing Societal Determinants of Health, 103 a.m. J. of Pub. Health, 2234 (2013), https://www.ncbi.nlm.nih.gov/ pmc/articles/PMC3828968/; John J. Donahue III & James Heckman, Continuous Versus Episodic Change: The Impact of Civil Rights Policy on the Economic Status of Blacks, NBER Working Papers Series, SSRN, (2007), https://papers.ssrn.com/sol3/ papers.cfm?abstract_id=474003; David Card & Alan Krueger, Trends in Relative Black-White Earnings Revisited, 83 The Am. Econ. Rev. 85–91 (1993), https://www.jstor.org/stable/2117645#:∼: text=For%20both%20of%20these%20 cohorts,1939%20cohort%20is%20especially%20 noteworthy. PO 00000 Frm 00036 Fmt 4701 Sfmt 4700 experiencing discrimination in health care settings. Comment: A few commenters expressed First Amendment concerns related to the overarching Section 1557 Policies and Procedures requirement, particularly the Nondiscrimination Policy requirement. One of these commenters recommended that, with respect to the Section 1557 Policy and Procedures requirement, OCR should clarify that covered entities retain free speech protections to the extent that sex discrimination does not result if a covered entity acknowledges a patient’s sex assigned at birth. An organizational commenter stated that the Nondiscrimination Policy is problematic under the First Amendment because requiring a covered entity to state that it does not discriminate on the bases of pregnancy, sexual orientation, gender identity, and sex characteristics constrains freedom of speech and freedom of association. Response: OCR acknowledges the comments regarding protections on the basis of sex, particularly as they relate to nondiscrimination on the basis of pregnancy or related conditions, sexual orientation, and gender identity. As noted above, we have revised § 92.8(b) by removing descriptions of sex discrimination and by cross-referencing § 92.101(a)(2) and that provision’s description of sex discrimination. Thus, a covered entity’s Nondiscrimination Policy need not explicitly include the various forms of prohibited sex discrimination to address any potential First Amendment concern. However, we emphasize that these concerns do not negate a covered entity’s obligation to implement Section 1557 Policies and Procedures. We also note here that we have amended the regulatory text to add, as a best practice towards compliance, that a recipient’s Nondiscrimination Policy reflect assurance of exemptions that have been triggered or that have been granted to that recipient under § 92.302. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Nondiscrimination Policy requirement at § 92.8(b) as proposed, with modifications. We are revising § 92.8(b)(1) to adjust the explanatory parenthetical for sex in the Nondiscrimination Policy to state ‘‘consistent with the scope of sex discrimination described at § 92.101(a)(2).’’ We are revising § 92.8(b) to add paragraph (b)(2) that states, ‘‘OCR considers it a best practice toward achieving compliance for a covered E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 entity to provide information that it has been granted a temporary exemption or granted an assurance of exemption under § 92.302(b) in the nondiscrimination policy required by paragraph (b)(1) of this section.’’ Grievance Procedures Comment: In general, commenters supported the grievance procedures requirement at § 92.8(c), including because allowing patients to voice concerns to providers builds trust between patients and providers. Response: OCR’s enforcement experience reveals that grievance procedures help covered entities lower compliance costs and provide covered entities the opportunity to resolve grievances—through direct communication with the individual raising the grievance—in the quickest possible manner without OCR’s involvement. Comment: Some commenters recommended that OCR require covered entities to adjudicate grievances quickly, and some of these commenters specifically requested that OCR add timeframes by which section 1557 grievances must be both acknowledged and resolved because covered entities may either belatedly or never acknowledge a complaint or take longer than perceived as necessary to resolve grievances. Others requested that OCR define ‘‘prompt and equitable’’ resolution, with one stating that ‘‘equitable’’ is a subjective construct and suggested that OCR consider requiring covered entities to resolve grievances by affording the aggrieved individual appropriate access to the health program or activity at issue. Relatedly, another commenter asked that OCR consider differentiating between pretreatment grievances and other grievances, because denials of care and coverage can result in the postponement or foregoing of care altogether and can require patients to wait for the resolution of a grievance before seeking care from an alternate provider. Response: We appreciate these commenters’ desire for additional specificity regarding what is meant by ‘‘prompt and equitable’’ resolution of a grievance. This terminology is consistent with grievance procedures requirements found in the Department’s section 504 and title IX regulations at 45 CFR 84.7(b) and 86.8(b), respectively. Imposing a single timeframe by which a covered entity must resolve a grievance does not account for the fact that covered entities vary in size, resources, and capabilities, and so one timeframe may not be appropriate for all entities. Multiple factors may impact the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 length of time required to evaluate and resolve a particular grievance and to ensure a fair process and reliable outcome, including the nature of the grievance. This is balanced by the fact that prompt resolution of complaints is necessary to further section 1557’s nondiscrimination objective. We encourage individuals to file complaints with OCR if they have filed a grievance that they do not believe has been resolved in a prompt and equitable manner. OCR’s investigation of such a complaint may determine whether a covered entity’s grievances procedures truly provide for prompt and equitable resolutions, and if they do not, OCR may seek corrective actions from the covered entity. For these reasons, we decline to add timeframes within which covered entities are required to address grievances, and we decline to define the term ‘‘prompt and equitable.’’ Comment: Some commenters recommended that OCR require covered entities to notify individuals of the ability to file a grievance. Other commenters requested that OCR revise § 92.8(c) to require a covered entity’s process for filing grievances be simple, not burdensome, and accessible to individuals with LEP and individuals with disabilities. Response: To the extent covered entities are required to have grievance procedures, covered entities are also required to include information about the availability of their grievance procedures and how to file a grievance in their Notice of Nondiscrimination, per § 92.10(a)(1)(vi). All covered entities, regardless of size, must also include information in the Notice of Nondiscrimination on how to file a discrimination complaint with OCR, per § 92.10(a)(1)(vii). In addition, the grievance process must be accessible to individuals with LEP and individuals with disabilities, consistent with section 1557 and this regulation. If an individual finds that a covered entity’s grievance process is generally overly burdensome to the point it is ineffective or nonexistent and thus hindering the prompt and equitable resolution of grievances, we recommend the individual file a complaint with OCR. Comment: Many commenters on this provision recommended that OCR require all covered entities (not just those with 15 or more employees) to have grievance procedures, while others either requested that OCR maintain the 15-employee threshold or eliminate the requirement altogether. Commenters in support of eliminating the 15-employee threshold contended that a covered entity’s size does not PO 00000 Frm 00037 Fmt 4701 Sfmt 4700 37557 protect patients from discrimination and the threshold is inequitable because it deprives patients of smaller covered entities the opportunity to directly engage with the covered entity to address alleged discrimination. According to commenters, individuals with disabilities face significant barriers to care when seeking and receiving services from smaller covered entities, and the 15-employee threshold unjustly deprives individuals with disabilities of the opportunity to address these barriers through grievances. Further, commenters remarked that regulatory carve outs and distinctions are confusing and difficult for both covered entities and patients when determining applicable requirements and protections. Commenters expressed concern that individuals from marginalized communities would be confused about why they could not submit a grievance with a covered entity with fewer than 15 employees simply due to the size of the covered entity, when other requirements in the rule apply regardless of covered entity size. Commenters also raised the following issues countering inclusion of a 15employee threshold: the statutory text of section 1557 is not so limited; the limitation is inconsistent with expanding section 1557’s application; an individual should have the ability to address discrimination in the first instance directly to the covered entity; and a covered entity with fewer than 15 employees that has grievance procedures will be able to resolve discrimination complaints more promptly at an earlier stage without formal OCR investigation. Citing the burden on smaller covered entities, some commenters requested that OCR maintain the grievance procedures requirement only for covered entities with at least 15 employees, eliminate the procedures altogether or utilize the SBA’s definition of small business. Response: We appreciate commenters’ concerns about the 15-employee threshold and recognize that individuals are not immune from experiencing discrimination when interacting with smaller covered entities. However, OCR declines to apply this requirement to all covered entities and note that this approach is consistent with OCR’s section 504 regulation, which similarly limits the grievance procedure requirement. See 45 CFR 84.7(a). Individuals remain able to file complaints with OCR when they experience discrimination in health programs and activities and may also raise concerns to smaller covered E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37558 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations entities outside of a formal grievance process. Given the benefits of having grievance procedures, we encourage smaller covered entities to voluntarily implement such procedures, which may help them more meaningfully engage with all individuals, including members of underserved communities, and better identify potential barriers to accessing their health programs and activities. Comment: Some commenters pointed to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) as precedent and demonstrable evidence that the Department believes providers of all sizes have the ability to comply with a Federal requirement to implement a process for handling complaints. These commenters suggested that all HIPAA-covered entities, including those with fewer than 15 employees, have experience implementing a process for receiving, handling, and investigating privacy complaints, which these covered entities can modify or replicate, if necessary, to include section 1557 discrimination grievances. Response: OCR appreciates commenters’ observation that HIPAAcovered entities of all sizes have experience implementing a complaint process. However, we are unpersuaded that the potential burden to smaller covered entities with existing HIPAA complaint processes would be minimal because these entities would need to revise their existing policies, train relevant staff, and process civil rightsrelated grievances in addition to processing HIPAA-related complaints. This is similar to our position in response to comments received in response to the 2015 NPRM. 81 FR 31395. Nothing in this rule prohibits entities of fewer than 15 employees from voluntarily creating a grievance process. Comment: In support of requiring all covered entities to have grievance procedures, commenters suggested that covered entities could have less extensive or detailed grievance procedures, and that such a procedure would not need to involve significant staff or resources. These commenters recommended that OCR develop model grievance procedures for smaller covered entities to help them comply with the grievance procedures requirement. Response: To assist all covered entities—including those with fewer than 15 employees that may wish to voluntarily implement a grievance procedure—we have made available sample grievance procedures on OCR’s website at www.hhs.gov/1557. We note VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 that the sample grievance procedure available on OCR’s website is more appropriate for smaller covered entities, and we remind covered entities that the rule’s general Section 1557 Policies and Procedures requirement is founded on the principle of scalability. Accordingly, the sample grievance procedure on our website may not be adequate for a larger covered entity or health system made up of several covered entities. Comment: Many commenters supported the record retention requirement at § 92.8(c)(2). Under this provision, we proposed that covered entities must retain records for a minimum of three (3) calendar years, and each record must include the name and contact information of the complainant, the alleged discriminatory action and alleged basis or bases of discrimination, the date the grievance was filed, the grievance resolution, and any pertinent information. Some commenters expressed that this requirement will help covered entities identify potential patterns and practices of discrimination of which they may not have otherwise been aware. Other commenters who supported this requirement expressed concern about patient privacy and recommended that OCR require covered entities to deidentify information related to the grievance during the retention period. Response: We appreciate commenters’ support for this new provision and recognize the importance of ensuring patient privacy related to recordkeeping. Section 92.8(c)(3) requires covered entities to keep confidential the identity of the individual who submits a grievance, subject to limited exceptions. We decline to revise the records retention requirement to require covered entities to deidentify that information related to the grievance. Many section 1557 covered entities must also comply with the HIPAA Privacy and Security Rules, which requires HIPAA covered entities to protect and secure all protected health information that a covered entity or business associate creates, receives, maintains, or transmits. If a covered entity discloses an individual’s protected health information in violation of the HIPAA Rules, then the covered entity is subject to OCR’s HIPAA enforcement measures.77 If a section 1557 covered entity maintains grievance records beyond three (3) calendar years, the covered entity may deidentify the information after the records retention period has elapsed. Even where a section 1557 covered 77 See 45 CFR 160.312 and 160.400 through 160.414. PO 00000 Frm 00038 Fmt 4701 Sfmt 4700 entity is not subject to HIPAA, that section 1557 entity must still comply with all applicable Federal and State privacy laws. Comment: One commenter requested that OCR revise § 92.8(c)(2) so that a covered entity be required to retain only ‘‘actionable’’ grievances because large, covered entities may receive grievances that are not related to section 1557’s protections. This commenter gave an example that a complaint may be employment-related, and therefore § 92.8(c)(2) should not require a covered entity to retain such a grievance. Another commenter raised a similar concern and recommended that OCR completely eliminate any record retention requirement as they relate to grievances because it is difficult to know when a grievance triggers the retention requirement. This commenter requested that, if OCR retains the grievance records retention requirement, that it only apply to covered entities with 15 or more employees. Response: Section 92.8(c)(2) applies only to covered entities that are required to have grievance procedures (i.e., those with 15 or more employees), and this provision expressly specifies that covered entities retain grievances it receives pursuant to the grievance procedures requirement at § 92.8(c)(1) that allege discrimination on the basis of race, color, national origin, sex, age, or disability in the covered entity’s health programs or activities. Thus, covered entities need not retain records pertaining to employment-related grievances or grievances that do not allege discrimination based on race, color, national origin, sex, age, or disability in the covered entity’s health programs or activities. If a covered entity cannot determine whether a complaint relates to section 1557, the covered entity should contact the complainant to obtain sufficient information to either investigate the grievance or determine if the complaint should be handled under a different process. We note that a covered entity’s dismissal of a grievance constitutes its resolution of the grievance. Comment: One commenter who expressed support for the retention requirement opined that the proposed three-year retention period is less burdensome than the seven-year retention requirement applicable to most records for hospice and palliative care. Another commenter recommended that covered entities be required to retain grievance-related records permanently due to the low costs associated with maintaining these records electronically, and a covered entity could find older records useful in E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations litigation. Another commenter recommended that OCR adopt a fouryear retention period to match section 1557’s four-year statute of limitations 78 because a retention period shorter than section 1557’s statute of limitations would prevent private litigants from obtaining grievance-related evidence relevant to a section 1557 claim. One commenter also recommended that OCR revise § 92.8(c)(2) so that the timeframe for covered entities to retain grievance records starts once the covered entity resolves the grievance rather than when the covered entity receives it. Response: OCR has determined that the three-year record retention requirement strikes the appropriate balance between covered entities’ burden concerns and the need for OCR to access this vital information in the course of a complaint investigation or compliance review. As stated in the 2022 NPRM, we understand that many covered entities already have a practice of retaining grievance records, and nothing in this rule prevents a covered entity from retaining records longer if they so choose. 87 FR 47849. We appreciate commenters’ recommendation that OCR specify that the retention obligation starts on the date that the covered entity resolves the grievance rather than on the date that the complainant filed the grievance, and we are revising § 92.8(c)(2) to reflect this change. Grievances take varying amounts of time to resolve, and starting the retention obligation on the date of receipt could potentially result in a covered entity disposing of records pertaining to a grievance prior to the resolution of the grievance. This change necessitates that we further revise § 92.8(c)(2) to require a covered entity’s grievance records also include the date that the covered entity resolved a grievance. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Grievance Procedure requirement provision at § 92.8(c) as proposed, with modifications. We are revising § 92.8(c)(2) to explain that the grievances that a covered entity must retain are those filed pursuant to its 78 See, e.g., Tomei v. Parkwest Med. Ctr., 24 F.4th 508, 515 (6th Cir. 2022) (holding the catchall Federal statute of limitations at 28 U.S.C. 1658(a) applies to claims under section 1557 because section 1557 lacks an express statute of limitations); but see Solis v. Our Lady of the Lake Ascension Cmty. Hosp., Inc., No. CV 18–56–SDD–RLB, 2020 WL 2754917, at *4 (M.D. La. May 27, 2020) (applying the Rehabilitation Act statute of limitations to a section 1557 claim of disability discrimination). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 grievance procedures required by § 92.8(c)(1) that allege discrimination based on race, color, national origin, sex, age, and disability in a covered entity’s health programs or activities, and that the records include the date the grievance was resolved. We are also clarifying at § 92.8(c)(2) that the retention period for grievance procedures starts on the date the covered entity resolves the grievance. Language Access Procedures Comment: Most commenters on this provision expressed support for the proposed language access procedures requirement at proposed § 92.8(d). Some commenters recommended that OCR revise § 92.8(d) to make clear that a covered entity’s language access obligations extend to companions of patients, beneficiaries, enrollees, and applicants. Response: It has been OCR’s practice to require covered entities to provide language assistance services for LEP companions of patients, beneficiaries, enrollees, and applicants when necessary. Rather than revising § 92.8(d), we are revising § 92.201 (Meaningful access for individuals with LEP) to codify this requirement. We discuss this further when addressing comments related to § 92.201. Because the language access procedures are intended to assist covered entities in complying with their language access obligations under § 92.201, they should ensure that companions are included. Comment: One commenter recommended that OCR allow covered entities the flexibility to identify the process and business rules that they currently use to identify individuals with LEP, how to provide language assistance services, and how to create and store translated materials and resources. This commenter suggested that § 92.8(d) reads as if it is intended for smaller covered entities that provide language assistance services in an ad hoc manner. Response: Section 92.8(d) applies to covered entities of all sizes, allowing flexibility for covered entities to scale their language assistance services procedures as needed. Section 92.8(d) does not restrict the manner in which a covered entity implements its language access procedures, which may include the use of pre-existing business tools that meet the necessary requirements. For example, § 92.8(d) does not dictate how covered entities’ employees identify individuals with LEP or how covered entities obtain language assistance services from qualified interpreters and translators (i.e., through PO 00000 Frm 00039 Fmt 4701 Sfmt 4700 37559 contract interpreters, in-house interpreters, etc.). Comment: Some commenters indicated that often patients with LEP have to repeat a language access intake process with every visit to a covered entity, even when they have already gone through such a process and their language access needs have been previously identified by the covered entity. To avoid this situation, commenters recommended that OCR require covered entities to note in a patient’s records whether the patient needs language assistance services, and if so, the specific language and services needed. Response: OCR understands that repeatedly having to request necessary language assistance services from the same covered entity can be frustrating and may result in wasted time or the cancellation of an appointment if the needed services are unavailable. While the commenters’ suggestion for covered entities to document the specific language assistance services needs in the patient with LEP’s record is a best practice that we encourage for inclusion in a covered entities’ language access procedures, OCR declines to revise § 92.8(d). As drafted, the provision allows covered entities the flexibility needed to comply. Comment: Some commenters requested that OCR revise § 92.8(d) with text: (1) directly from § 92.201 related to covered entities’ obligation to provide each individual with LEP with meaningful access; and (2) that aligns with Executive Order 13166 (‘‘Improving Access to Services for Persons with Limited English Proficiency’’); 79 title VI; Medicaid’s commitment to enhancing access through culturally competent care as defined in 42 CFR 440.262; and the Agency for Healthcare Research and Quality’s ‘‘Improving Patient Safety Systems for Patients with Limited English Proficiency’’ guide.80 Response: Section 92.8(d) already references covered entities’ obligations under § 92.201, so it is unnecessary to restate that language here. We decline to modify the provision to add language from the suggested requirements and resources, as this provision relates to covered entities’ obligation under section 1557. Comment: Many commenters sought clarity about whether the language 79 E.O. 13166, 65 FR 50121 (Aug. 11, 2000). Dep’t of Health & Hum. Servs., Agency for Healthcare Rsch. and Quality, Improving Patient Safety Systems for Patients With Limited English Proficiency: A Guide for Hospitals (2012), https:// www.ahrq.gov/sites/default/files/publications/files/ lepguide.pdf. 80 U.S. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37560 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations access ‘‘procedures’’ required by § 92.8(d) differ from documents commonly referred to as language access ‘‘plans.’’ Noting OCR’s longstanding recognition of the benefits of having a language access plan, as expressed in the Department’s ‘‘2003 Guidance to Federal Financial Assistance Recipients Regarding Title VI Prohibition Against National Origin Discrimination Affecting Limited English Proficient Persons’’ (HHS LEP Guidance), 68 FR 47311 (Aug. 8, 2003), many commenters recommended that OCR modify § 92.8(d) to clarify that covered entities must develop and implement a language access plan before developing language access procedures because developing effective policies and procedures require such advance planning and give covered entities clear policies to follow when seeing patients with LEP. According to these commenters, formal language access plans require a covered entity to consider and evaluate the needs of a service area, providing a better understanding of populations, prevalence of specific language groups, language access needs, and scope of services needed to provide meaningful access. Commenters highlighted the rapid growth of pockets of individuals with LEP with distinct language and cultural conventions, including indigenous immigrant populations from Central and South America, and the changing language needs for recent arrival of refugees from Afghanistan, Ukraine, Russia, and other non-English speaking countries. In contrast, one commenter appreciated that the Proposed Rule did not require covered entities to implement language access plans and noted that small, covered entities lack resources, including time, administrative effort, and financial resources to implement a language access plan. Citing the 2015 NPRM, the commenter stated the cost to develop a language access plan at $1,135 per small, covered entity,81 and recommended that OCR finalize the rule without requiring covered entities to develop and implement a language access plan. Response: OCR appreciates commenters’ emphasis on the value of language access plans, which as commenters noted, are distinct from the language access procedures required under this section. Covered entities are not explicitly required to analyze the specific populations with LEP in their service areas. However, in order to 81 The $1,135 figure is derived from the 2015 NPRM for section 1557 on ‘‘training costs’’ for small entities. See 80 FR 54213. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 develop effective language access procedures and ensure compliance with the obligations at § 92.201, a covered entity will need to engage in some form of analysis to identify the language access needs in their service area. For example, when finalizing a list of preferred language assistance services providers, a covered entity will need to determine which providers are most capable of meeting the language needs of the individuals with LEP within the service area. To best inform its decisionmaking process, a covered entity may first attempt to identify the non-English languages most spoken in the relevant service area and confirm that interpreter and translation service providers can accommodate those languages. The HHS LEP Guidance, cited by commenters, is still instructive and relevant and provides helpful information in how to develop a strategy for delivery of language assistance services. See 68 FR 47313–22. Covered entities are also encouraged to use the language access planning resources provided at https:// www.lep.gov/language-access-planning or reference HHS’s 2023 Language Access Plan for guidance at https:// www.hhs.gov/sites/default/files/ Language-Access-Plan-2023_0.pdf. Covered entities with language access plans are often better prepared to provide individuals with LEP with meaningful access to their health programs and activities. For covered entities that have developed, implemented, and maintained language access plans, we highly encourage those covered entities to sustain that practice and to consider modifying their plans to include the elements required by § 92.8(d), to the extent it is not already included. To the extent a covered entity’s language access plan meets the requirements of § 92.8(d), a separate procedures document will not be required regardless of whether the document is referred to as a ‘‘plan’’ or ‘‘procedures.’’ Comment: Some commenters recommended that OCR delete the requirement in § 92.8(d) for covered entities to identify the names of qualified bilingual/multilingual staff members due to employee turnover, with one commenter also requesting that OCR eliminate the requirement to maintain a list and location of electronic and written translated materials because such a requirement would be an onerous, inefficient use of time due to frequent changes to translated materials. Another commenter indicated that these requirements are especially difficult for large, covered entities, and that health insurance issuers in particular should have the option to provide business PO 00000 Frm 00040 Fmt 4701 Sfmt 4700 rules and rationale with respect to how and where they store documents rather than create a duplicative process. This commenter also recommended that OCR allow covered entities to articulate the process for accessing language services and contact information for the covered entity’s department or functional group responsible for translations. Response: OCR acknowledges that covered entities may need to periodically revise their language access procedures to reflect changes to qualified bilingual/multilingual staff; however, these staff members play a critical role in the delivery of timely language assistance services and therefore it is imperative that employees be able to identify qualified bilingual/ multilingual staff members as quickly as possible through the use of a current directory. We decline to remove the requirement that language access procedures include a current list of qualified bilingual/multilingual staff members. Timely and effective language assistance services are also best served by maintaining a current list of translated materials. OCR notes commenters’ concerns regarding the practicality and burden of maintaining a list of the physical location of all written translated materials. For this reason, we are revising the requirement to no longer require the location of written translated materials, but only how to access electronic translated materials (i.e., their location on a covered entity’s network, intranet, or external-facing website). Section 92.8(d) requires covered entities to include contact information for their Coordinator and how employees obtain services of qualified interpreters, translators, and multilingual/bilingual staff. This allows for covered entities to articulate the process for accessing language services; if this function has been delegated to a department or functional group, contact information for that department or functional group should be included in the language access procedures. Comment: Some commenters recommended that the Department secure resources for small, covered entities to support their provision of language assistance services. For example, one commenter recommended that OCR contract with a telephonic interpretation service and allow small, covered entities to opt-in to using that service. Another commenter suggested that OCR partner with the U.S. Department of Education to invest in medical interpreter training for smaller language communities because investing in these communities would E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 result in higher quality health care. Another commenter requested that OCR make available sample policies and procedures; best practices for working with language assistance companies, identifying qualified (and unqualified) interpreters, and producing accurate and quality translations; and training videos. Response: OCR appreciates these commenters’ suggestions for providing resources to assist small, covered entities and, we are committed to making sample language access procedures available on our website at www.hhs.gov/1557. However, it is not appropriate for OCR, as a Federal agency, to endorse private interpreter or translator service providers. We are also unable to provide a telephonic interpretation contract into which small, covered entities could voluntarily participate. OCR also appreciates the importance of interpreter training for less frequently encountered languages and is committed to developing a robust health care work force. To illustrate this commitment, the Department announced a ‘‘Promoting Equitable Access to Language Services in Health and Human Services’’ initiative in Fall 2022, for which grants were awarded to 11 organizations to develop and test methods of informing individuals with LEP about the availability of language assistance services in health care settings.82 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Language Access procedures requirement provision at § 92.8(d) as proposed, with modifications. We are revising § 92.8(d) to require language access procedures to strike the requirement to include the location of any written or electronic materials and adding a requirement to include ‘‘how to access electronic translations.’’ We replaced ‘‘publication date’’ with ‘‘date of issuance’’ to better account for translated materials that may be in hard copy or electronic format. We are also making one technical revision. We are replacing ‘‘limited English proficient individual’’ with ‘‘individual with limited English proficiency,’’ consistent with modifications elsewhere. 82 U.S. Dep’t of Health & Hum. Servs., Off. of Minority Health, FY 2022 Grants Awards: Promoting Equitable Access to Language Services in Health and Human Services (October 11, 2022), https://minorityhealth.hhs.gov/fy-2022-grantawards#:∼:text=Grant%20period%3A%20 2022%2D2025,in%20health%20care%2D related%20settings. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Effective Communication Procedures Comment: Comments related to proposed § 92.8(e), regarding effective communication procedures, were similar to the language access procedures comments. Many commenters requested that OCR require covered entities to develop and implement a broad ‘‘communication access plan,’’ which would address effective communication and accessibility for individuals with disabilities, including individuals with disabilities who also have LEP. Commenters recommended that covered entities be required to develop communication access plans prior to developing their effective communication procedures. Some commenters suggested that a covered entity’s effective communication procedures should also include how to determine the sign language an individual with a communication disability uses and whether the individual needs the services of an interpreter team, such as a certified deaf interpreter and an American Sign Language interpreter. One commenter recommended that we add a requirement for covered entities to create section 1557, ADA, and section 504 communication access plans along with the effective communication procedures requirement. Response: Advance planning is an essential component of developing and implementing effective procedures that will ensure compliance with the obligations at § 92.202, which necessitate consideration of the various aids and services that may be required to deliver effective communication. Thus, while covered entities are not explicitly required to engage in advance planning, their ability to comply with § 92.202 will be best supported though robust procedures that are developed though a thoughtful and thorough process. Covered entities may include more information in their respective effective communication procedures than § 92.8(e) requires, and we encourage covered entities that are already implementing communication access plans to maintain that practice. Covered entities with active communication access plans are permitted to modify such plans to include the information required by § 92.8(e); to the extent a covered entity’s communication access plan meets the requirements of § 92.8(e), a separate procedures document will not be required regardless of whether the document is referred to as a ‘‘communication access plan’’ or ‘‘effective communication procedures.’’ PO 00000 Frm 00041 Fmt 4701 Sfmt 4700 37561 While OCR appreciates the similarities between section 1557, section 504, and ADA’s effective communication requirement, section 1557 is a distinct statute and imposing requirements for a similar procedure under the ADA and section 504 is outside the authority of this rulemaking. Comment: One commenter requested that OCR make clear in the final rule that covered entities must implement effective communication and language access requirements in a wellcoordinated, comprehensive, seamless, and equally effective manner such as through a standard operating procedure. This commenter also recommended that we inform covered entities that effective communication and language access requirements are of equal, paramount importance and closely interdependent with each other, and the commenter suggested that we issue guidance recommending effective communication and language access coordination. Response: We agree with the commenter that effective communication and language access requirements are equally important, and effective communication and language access requirements can be interdependent, particularly when communicating with individuals with disabilities who have LEP. Though covered entities would ideally implement their effective communication and language access requirements in a well-coordinated, comprehensive, seamless, and equally effective manner, we decline to revise either paragraph (d) or (e) of § 92.8 or include any additional regulatory provisions imposing such standards on covered entities, in part, because such standards would be difficult to objectively measure. Comment: Another commenter recommended that we revise § 92.8(e) to require covered entities’ effective communication procedures include information about how covered entities will assess staff members’ competency as qualified interpreters or qualified readers. Response: We discuss assessment of interpreters at § 92.4; because of the flexibility allowed by the definition regarding how a covered entity chooses to assess the qualifications of interpreters (and readers), we decline to require this information be included in the procedures. Comment: Some commenters recommended that OCR clarify that a covered entity’s effective communication procedures apply to individuals with any disability that affects an individual’s ability to communicate. Further, these E:\FR\FM\06MYR4.SGM 06MYR4 37562 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations commenters also requested that we clarify that a covered entity’s auxiliary aids and services options are not limited to qualified interpreters. Another commenter recommended that we include examples of accommodations, assistance, and opportunities for individuals with speech-related disabilities in the preamble and accompanying guiding documents. Response: Covered entities’ effective communication responsibilities, further discussed at § 92.202, apply to communication with all people with disabilities and a covered entity’s effective communication procedures must equip employees with the information and tools necessary to meet the needs of individuals with many different types of disabilities. These may include, but are not limited to, sensory, manual, or speaking disabilities. Covered entities’ obligations to provide auxiliary aids and services extend beyond qualified interpreters. A nonexhaustive list of auxiliary aids and services can be found in the definition of ‘‘auxiliary aids and services’’ in § 92.4. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Effective Communication Procedures requirement provision at § 92.8(e) as proposed, without modifications. Reasonable Modification Procedures Comment: Many commenters supported the reasonable modification procedures requirement under proposed § 92.8(f), with some noting that many covered entities, particularly smaller covered entities, are unaware of their obligation to reasonably modify their policies and procedures when necessary to avoid discrimination on the basis of disability. Some commenters recommended that OCR proactively provide examples of the types of reasonable modifications that covered entities should consider as a means of increasing the likelihood that a covered entity’s reasonable modifications procedures are adequate. One commenter urged OCR to include a statement in the final rule’s preamble or guidance that a reasonable modification can include communicating in a more accessible modality (e.g., via email), if the patient requests it. Response: It is OCR’s intent that requiring a reasonable modification procedure will address the lack of knowledge on behalf of covered entities that commenters raised, and will increase covered entities’ ability to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 respond appropriately to requests. OCR believes this will raise overall compliance with the requirement at § 92.205 to provide reasonable modifications, and will benefit both covered entities and individuals seeking access to health programs or activities. The vast range of potential reasonable modifications available or necessary do not lend themselves to an exhaustive list and so we are not able to include such a list here. However, many reasonable modifications involve reasonable changes in the way that an entity does something or permits an individual to do something. For example, a covered entity that generally communicates with patients via phone but receives a request from an individual with a disability to receive communication via email as a modification should generally grant that request, unless the covered entity can demonstrate that doing so would fundamentally alter the nature of the health program or activity. Other examples include allowing an individual with a disability whose disability makes attending morning appointments difficult to schedule afternoon appointments when appointments may not generally be available at that time, or allowing an individual with a disability to attend appointments via telehealth instead of in person when such modification does not fundamentally alter the nature of the service being provided. To be clear, there is no exhaustive list of what constitutes a reasonable modification, nor must covered entities develop one. Rather, covered entities are required to implement written procedures describing their process by which an individual with a disability may request a reasonable modification and how a covered entity processes and responds to such requests. Comment: One commenter stated that a covered entity must provide reasonable modifications to an individual with a disability in the absence of an affirmative request for the modification if the covered entity had knowledge of the individual’s disability or when the individual’s disability is obvious. Relatedly, another commenter requested that OCR revise § 92.8(f) to reflect that an individual’s failure to request a reasonable modification does not always excuse the covered entity from providing a reasonable modification if the modification does not result in a fundamental alteration. Response: Section 92.8(f) is an administrative requirement to implement a procedure by which a reasonable modification can be requested, evaluated, and granted. PO 00000 Frm 00042 Fmt 4701 Sfmt 4700 However, as noted in the 2022 NPRM, failure to request a reasonable modification does not always excuse the covered entity from providing a reasonable modification to avoid discrimination on the basis of disability, as long as the modification would not result in a fundamental alteration of the health program or activity. 87 FR 47850. For example, when a covered entity has knowledge of an individual’s disability and needs, or when an individual’s disability and needs are obvious, a covered entity must provide modifications in the absence of a request.83 Comment: Some commenters noted a common occurrence where patients with disabilities must repeatedly request the same reasonable modifications or auxiliary aids and services from the same covered entity for each visit. These commenters urged OCR to include additional language in the final rule preamble and guidance for covered entities to minimize patients’ burdens of having to repeatedly notify, request, monitor, and enforce the covered entity’s obligation to remove access barriers. Response: These commenters’ recommendations mirror similar comments related to experiences of patients with LEP who must repeatedly request the same language assistance services from the same covered entity. Such a practice may be inefficient and may violate the requirements of this part if they result in the delay or denial of access to a health program or activity. See discussion of § 92.201. While we strongly recommend that covered entities engage in the best practice of documenting in patients’ medical records the specific reasonable modifications requested by patients with disabilities, in an effort to avoid overly prescriptive requirements we decline to revise § 92.8(f). Comment: Commenters recommended that OCR require covered entities to appoint an individual to ensure compliance with the reasonable modification requirement. This person would: inquire whether patients need communications-related modifications; ensure such modifications are provided promptly; and monitor the patient’s stay 83 See, e.g., Greer v. Richardson Indep. Sch. Dist., 472 F. App’x 287, 296 (5th Cir. 2012) (holding that a ‘‘failure to expressly ‘request’ an accommodation is not fatal to an ADA claim where the defendant otherwise had knowledge of the individual’s disability and needs but took no action’’); Duvall v. Cnty. of Kitsap, 260 F.3d 1124, 1139 (9th Cir. 2001) (‘‘When the plaintiff has alerted the public entity to his need for accommodation (or where the need for accommodation is obvious . . .), the public entity is on notice that an accommodation is required . . .’’). E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations to ensure the modification is provided through the duration of the entire stay. This person would also be responsible for ensuring the covered entity is otherwise complying with the requirement to provide auxiliary aids and services. Response: This rule, at § 92.7, requires designation of a Section 1557 Coordinator by covered entities that employ 15 or more persons. The Coordinator is responsible for ensuring compliance with section 1557’s requirements, including the requirement to provide auxiliary aids and services at § 92.202 and to make reasonable modifications at § 92.205. A covered entity may delegate responsibility for the actual provision of auxiliary aids and reasonable modifications, and implementation of the corresponding procedures, to an individual other than the Coordinator, such as a designee; however, we decline to require the designation of an additional employee to implement these requirements. Comment: One commenter recommended that OCR revise the regulatory text for § 92.8(f) to substitute the modifier ‘‘reasonable’’ with ‘‘reasonable and appropriate.’’ Response: We decline to adopt the commenter’s suggested regulatory revision because ‘‘reasonable modification’’ is a term of art with a long history of enforcement in the disability context. We note that, consistent with similar longstanding disability rights law enforcement, we use ‘‘appropriate’’ in §§ 92.8(e) and 92.202(b) when describing the auxiliary aids and services that a covered entity must use to effectively communicate with individuals with disabilities. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the Reasonable Modification Procedures requirement provision at § 92.8(f) as proposed, without modifications. Training (§ 92.9) In § 92.9, we proposed requiring covered entities to train relevant employees in their health programs and activities on their Section 1557 Policies and Procedures. In § 92.9(a), we proposed a general requirement that covered entities train relevant employees of their health programs and activities on the Section 1557 Policies and Procedures required by proposed § 92.8. In § 92.9(b), we specified when covered entities must train relevant employees on their Section 1557 Policies and Procedures. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 In § 92.9(b)(1), we proposed that covered entities would be required to train existing relevant employees on their Section 1557 Policies and Procedures as soon as practicable, but no later than one (1) year after the effective date of the final rule. In § 92.9(b)(2), we proposed that covered entities train new relevant employees within a reasonable period of time after they join a covered entity’s workforce. In § 92.9(b)(3), we proposed requiring covered entities to train relevant employees whose roles are affected by material changes to the covered entity’s Section 1557 Policies and Procedures and any other civil rights policies or procedures the covered entity has implemented. In § 92.9(c), we proposed requiring covered entities to contemporaneously document their employees’ completion of the training required by this section in written or electronic form and maintain said documentation for no less than three (3) calendar years. We invited comment on the experiences of covered entities in implementing training such as that required by proposed § 92.9, examples of where training made a difference in compliance, the timing of required training, whether covered entities would like the flexibility to include this required training as part of their existing annual compliance training, what types of changes would constitute a material change such that a covered entity would need to retrain staff, and how long training records must be retained. We also sought general comment on this proposal, including the effectiveness of civil rights training programs, the benefits experienced by covered entity staff and the people they serve, as well as the costs associated with the proposed training requirements. We further requested comment on whether the Section 1557 Policies and Procedures requirements and training requirements may increase the likelihood of compliance with the substantive legal requirements of section 1557. The comments and our responses regarding § 92.9 are set forth below. Comment: Many commenters on this provision expressed support for the training requirement and provided a range of reasons, including because the training is intended to impart knowledge and awareness of civil rights requirements and responsibilities; it will serve as an additional safeguard against discrimination and help reduce health disparities; and it will help providers connect patients to the services they need. PO 00000 Frm 00043 Fmt 4701 Sfmt 4700 37563 Commenters believed that a covered entity’s staff need to understand section 1557 requirements, especially considering increased instances of employee turnover. One commenter also encouraged OCR to repeat the language in the Proposed Rule and remind covered entities that ‘‘the more thoroughly a covered entity trains its staff on its Section 1557 Policies and Procedures, the more likely it is that the covered entity will successfully provide services to individuals in a nondiscriminatory manner.’’ 87 FR 47850. Some commenters said that civil rights violations occur due to lack of awareness and that training on covered entities’ Section 1557 Policies and Procedures will help eliminate discrimination in health care because it promotes knowledge about how to deliver and administer health programs and activities to all patients, including patients who are members of communities that have experienced discrimination in health care services. Some commenters suggested that OCR provide additional detail regarding the contents and delivery of the training, including by being more explicit about the nature and standards for determining adequacy of training. Conversely, one commenter recommended that OCR not make the training requirement overly prescriptive, and another asked OCR to give covered entities the authority to determine the training elements that best fit covered entities’ operations. Some commenters opposed the training requirement, referencing existing compliance burdens for providers, particularly small providers. Some commenters requested that OCR abandon the training requirement in the final rule because the requirement lacks specificity, is weak, vague, difficult to enforce, ineffective, will require more paperwork, and will confuse specialty clinics like dental offices; one commenter requested that OCR specifically exempt dermatology practices from the training requirement. Many of the commenters that opposed the training requirement added that, if the rule is finalized as proposed, OCR should develop and provide educational materials and training resources, including materials to test trained employees’ understanding of the new requirements. Response: Section 92.9 requires covered entities to train relevant employees on their tailored Section 1557 Policies and Procedures, which will serve as a proactive safeguard against discrimination. Given this benefit, we decline to remove this E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37564 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations provision or exempt specific fields of practice from compliance with this requirement. Recognizing the resources needed to comply with the training requirement, § 92.9 allows covered entities flexibility in designing the training they provide. However, the efficacy of the training— and its civil rights compliance benefit— will depend on a covered entity’s effort in developing and conducting the training. OCR’s experience with enforcing HIPAA’s training requirement, 45 CFR 164.530(b), has found that employee-related violations are more limited where the required HIPAA training is routinely provided compared to where it is not. We anticipate that the section 1557 training requirement will similarly result in covered entities’ employees being more aware of section 1557’s discrimination prohibitions and establish a foundation by which covered entities’ employees more consistently comply with nondiscrimination requirements. With respect to the commenters’ view that the training requirement will be difficult to enforce, the document retention requirement in § 92.9(c) is designed to assist with this. Moreover, OCR has been successfully enforcing HIPAA covered entities’ compliance with HIPAA training requirements for more than 20 years. Through investigations, OCR evaluates covered entities’ compliance with training requirements, and, when necessary, OCR ensures that a covered entity takes corrective actions to comply with said requirement. To support compliance with this rule, OCR has made materials available on our website at www.hhs.gov/1557; however, the training required under § 92.9 must be based on the covered entity’s own policies and procedures. Thus, while OCR is providing general resources on section 1557 requirements, they must be supplemented by the covered entity to include information regarding their specific Section 1557 Policies and Procedures. Comment: Several commenters asked OCR to clarify whether covered entities could incorporate training on their Section 1557 Policies and Procedures with existing employee and annual compliance training instead of mandating a stand-alone training. One commenter recommended that covered entities train their employees on their respective Section 1557 Policies and Procedures separately because combining this training can result in information overload if employees are trained on multiple issues at the same training. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: This rule does not require or prohibit covered entities from incorporating the training required under § 92.9 with pre-existing employee or annual compliance trainings. We encourage covered entities to regularly train employees on their Section 1557 Policies and Procedures, possibly alongside other annual compliance trainings, and we recommend that covered entities offer section 1557 trainings in a manner that will result in maximum knowledge retention. While the rule does not specify the frequency with which trainings must be provided, covered entities should keep in mind that they must train new employees within a reasonable period of time after the employee joins a covered entity’s workforce. Comment: We received several comments recommending that OCR clarify the term ‘‘relevant employees’’ who must be trained under § 92.9. Many commenters recommended that we define ‘‘relevant employees’’ in the final rule’s definitions section at § 92.4 or within § 92.9 itself. Some commenters suggested that ‘‘relevant employees’’ should include: employees whose roles and responsibilities require interfacing with patients and the public; employees who make decisions about patient care and covered entity operations that impact patient care; employees in leadership and supervisory roles who make decisions that affect nondiscrimination; and employees, including C-suite leadership (i.e., the chief executive officer, chief financial officer, chief operating officer, and chief information officer), who are responsible for executing and making decisions regarding financial assistance, patient billing, and collections. Citing the importance of interactions between covered entities and patients in the long-term services and supports context, one commenter recommended that ‘‘relevant employees’’ should include temporary staff who interact with the public or clients. Response: We appreciate commenters’ recommendations to define ‘‘relevant employee.’’ Though we described a covered entity’s relevant staff who must receive the training required in the 2022 NPRM, 87 FR 47851, based on comments received, we agree that including more specificity in the final rule text will add additional clarity for covered entities. We have provided a description of ‘‘relevant employee(s)’’ in new § 92.9(b)(4), which that, for purposes of the section, ‘‘relevant employees’’ includes employees whose roles and responsibilities entail interacting with patients and members of the public; making decisions that PO 00000 Frm 00044 Fmt 4701 Sfmt 4700 directly or indirectly affect patients’ health care, including the covered entity’s executive leadership team and legal counsel; and performing tasks and making decisions that directly or indirectly affect patients’ financial obligations, including billing and collections. Below, we specify that relevant employees may include temporary employees in addition to permanent employees and have revised the regulatory text accordingly. Comment: Other commenters recommended that OCR require covered entities to train all of their employees on the covered entities’ Section 1557 Policies and Procedures because all employees may encounter a patient at any time, and they should understand basic section 1557 concepts. One commenter suggested that if OCR does not require covered entities to train all of their employees, then we should broaden who we consider to be ‘‘relevant employees’’ because employees who do not have direct patient interaction or policy-making roles may still have section 1557 responsibilities, and many of these employees are likely to engage in incidental patient interaction during the course of their work. Response: A covered entity has the discretion to train all of its employees to eliminate the burden of determining who the covered entity believes is and is not a relevant employee. OCR notes that an employee who makes decisions that indirectly affect patients’ health care or financial obligations meets the definition for ‘‘relevant employee’’ at § 92.9(b)(4), and therefore a covered entity would need to train such an employee pursuant to this provision. However, given the diversity of covered entities under this rule, we decline to mandate training for all staff. For example, to do so may cause confusion for covered entities that operate a health program that is part of a larger operation (e.g., a retail grocery store that also operates a covered pharmacy). Comment: Some commenters recommended that, due to high staff turnover and the common practice of hiring temporary, contract, or travel staff, OCR should consider allowing temporary staff to transfer prior, completed training from one facility to another to limit burden and redundancy. These commenters also asked OCR to permit training completion documentation from one covered entity to meet the documentation requirement for another covered entity as a means to limit burden and redundancy. Response: Section 92.9 requires a covered entity to train employees on its E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations specifically tailored Section 1557 Policies and Procedures. Thus, Covered Entity A’s Section 1557 Policies and Procedures will be different from Covered Entity B’s Section 1557 Policies and Procedures, and therefore a temporary employee’s training on Covered Entity A’s policies and procedures will not be transferable to Covered Entity B. Though temporary, contractor, and travel employees may be with an entity for a limited amount of time, that does not minimize the likelihood that these employees may still encounter an individual with LEP or an individual with a disability who may need language assistance services, effective communication, or a reasonable modification. Covered entities that hire temporary, contract, and travel employees will still need to train these employees, document such training, and maintain that documentation for the requisite amount of time. We note that this approach is consistent with OCR’s enforcement of the HIPAA training requirement. Comment: Several commenters requested that OCR require covered entities to train their employees beyond their respective Section 1557 Policies and Procedures. For example, commenters suggested that OCR require covered entities to train their employees on a variety of issues including: how to work with interpreters (in person, over the telephone, and via remote video); cultural competence, including how employees should address stigma experienced by individuals with LEP and individuals with disabilities; interacting with people with disabilities (including individuals who are deaf, hard of hearing, deafblind, and deafdisabled); and how to competently address transgender and nonbinary patients. Some commenters recommended that covered entities invite individuals with disabilities and other diverse backgrounds to help conduct required training because learning from people with lived experiences will help covered entities achieve effective communication and reduce biases. Another commenter recommended that OCR work with stakeholders to develop appropriate training materials. Response: We encourage covered entities to consider investing in their workforces by providing employees additional civil rights and nondiscrimination training beyond what § 92.9 requires. For example, covered entities may deploy interactive civil rights trainings that involve questions and answers and that more actively engages participants rather than the use of training formats like pre-recorded VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 sessions to maximize comprehension of complex civil rights concepts. OCR also acknowledges that hiring, collaborating with, or otherwise engaging individuals with disabilities and other individuals from underserved communities to provide input on training (and the underlying Section 1557 Policies and Procedures) is a best practice. Further, engaging with these same groups to provide training regarding best practices and other civil rights-related issues will give a covered entity’s employees valuable perspective about the importance of delivering compassionate, inclusive, and responsive health care. However, we decline to expand the scope of the training requirement at this time. It is our position that the training on the Section 1557 Policies and Procedures required in § 92.9 strikes the appropriate balance between covered entities’ burden concerns and the need for awareness of this vital information. We note that OCR has provided a general resource on section 1557 requirements that can supplement covered entities’ Section 1557 Policies and Procedures training, available at www.hhs.gov/1557. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing § 92.9 as proposed, with modifications. We are revising § 92.9(b)(1) to specify that a covered entity must begin training its relevant employees no later than 30 days after a covered entity implements its policies and procedures required by § 92.8 and no later than 300 days after the effective date of the part. We are including a definition of ‘‘relevant employee(s),’’ for purposes of the section only, at § 92.9(b)(4) to provide: ‘‘for the purposes of this section ‘relevant employees’ includes permanent and temporary employees . . . .’’ Lastly, we are modifying § 92.9(c) to clarify that covered entities are required to retain (rather than ‘‘maintain’’) training documentation for the requisite time period. Notice of Nondiscrimination (§ 92.10) In § 92.10(a), we proposed requiring covered entities to provide a notice of nondiscrimination, relating to their health programs and activities, to participants, beneficiaries, enrollees, and applicants of their health programs and activities, and to members of the public (‘‘Notice of Nondiscrimination’’). Section 92.10(a)(1) proposed the required contents of the Notice of Nondiscrimination. Section 92.10(a)(2) proposed when and where covered PO 00000 Frm 00045 Fmt 4701 Sfmt 4700 37565 entities must provide the Notice of Nondiscrimination. In § 92.10(b), we proposed that a covered entity may combine the content of the notice required by § 92.10(a) of this section with the notices required by title VI, section 504, title IX, and the Age Act implementing regulations 84 if the combined notice clearly informs individuals of their civil rights under section 1557 and the part and meets the requirements outlined in proposed § 92.10(a)(1). We invited comment on whether the Notice of Nondiscrimination requirement as proposed is practical, likely to be effective, and responsive to concerns raised regarding the 2016 and 2020 Rules, including the sufficiency of the contents of the notice and requirements regarding when and where covered entities must provide this notice. We sought comment on the best ways to provide an accessible notice to individuals with disabilities who may require auxiliary aids and services and the best way in which to provide the notice in a manner accessible to individuals with LEP. The comments and our responses regarding § 92.10 are set forth below. Comment: Many commenters strongly support the notice requirements set forth in §§ 92.10 and 92.11 (Notice of Availability), stating that such notices are needed to help people know their rights and will reduce health disparities, especially for persons with LEP and persons with disabilities. Some organizational commenters added that when the 2016 Rule’s notice requirement, former 45 CFR 92.8, was removed by the 2020 Rule, many people did not know their rights, how to access interpreters or auxiliary aids and services, or how to file a grievance. Several commenters added that a clear explanation of rights and contact information for the Section 1557 Coordinator, as set forth in § 92.10(a)(1)(v), is crucial. Some disability rights groups commented that not only should the Section 1557 Coordinator’s contact information be included, but also that of the ADA Coordinator. Response: The Notice of Nondiscrimination is a critical means by which to inform individuals of their civil rights, which is part of a proactive civil rights compliance structure that functions—in part—through grievances and complaints raised by individuals. We decline to require inclusion of contact information for an ADA 84 45 CFR 80.6(d) (title VI); 84.8 (section 504, federally assisted); 85.12 (section 504, federally conducted); 86.9 (title IX); 91.32 (Age Act). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37566 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Coordinator as this regulation is limited to section 1557; further, not all covered entities under this rule are subject to the ADA. Comment: Various covered entities commented that the burden of the notice provisions is compounded by the complexity of having two separate notices (i.e., the Notice of Nondiscrimination and the Notice of Availability) and the requirements to provide information in 15 languages. Response: OCR takes seriously the concerns raised by some commenters regarding burden. In crafting the two distinct notice requirements, OCR considered comments received in response to the 2015 and 2019 NPRMs regarding the burden of a notice requirement. The provisions in the final rule reflect careful consideration of what must be included in each notice, and they include substantially more clarity regarding when and where each notice must be provided compared to the 2016 Rule. We note that there is not a requirement that ‘‘all information’’ be provided in multiple languages; the requirement is that the Notice of Availability required by § 91.11 be provided in 15 non-English languages to inform individuals of the availability of language assistance services and auxiliary aids and services. Further discussion of this requirement can be found in our discussion related to the Notice of Availability (§ 92.11). Comment: Many commenters noted that the parenthetical for sex discrimination included in proposed § 92.10(a)(1)(i) differs from the language of § 92.101(a)(2) and that it should be consistent, such that it should include sexual orientation and gender identity as well as pregnancy-related conditions. Response: OCR appreciates the need for consistency across the regulation, and to ensure that the public is aware of the various bases for discrimination included under the umbrella of sex discrimination. As such, OCR has revised the parenthetical in § 92.10(a)(1)(i) to directly cite to § 92.101(a)(2), rather than listing examples of discrimination on the basis of sex. This is consistent with edits made to the Nondiscrimination Policy required by § 92.8(b). Comment: Various commenters requested that OCR require any entity receiving a religious exemption to include notice of the exemption in the Notice of Nondiscrimination; they said it would be misleading to have a notice stating that the entity does not discriminate if it has been granted permission to do so in certain circumstances. They stated that the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 information is needed for LGBTQI+ persons seeking health care. Response: OCR appreciates these comments. OCR declines to revise § 92.10 to impose an affirmative obligation on a recipient to identify any exemptions it has received under applicable Federal religious freedom and conscience laws. OCR additionally notes that it is a best practice for a recipient to include in its Notice of Nondiscrimination language when it has received a temporary exemption or an assurance of exemption. OCR is also subject to the Freedom of Information Act (FOIA), and information may be released to a requestor or made available for public inspection consistent with the agency’s obligations under that statute and its implementing regulations. Comment: Several commenters stated that the Notice of Nondiscrimination should be provided in the same nonEnglish languages required by § 92.11 (Notice of Availability). Several commenters urged OCR to create a model Notice of Nondiscrimination, and to issue translations of this notice. Response: The Notice of Nondiscrimination is among the materials that must be accompanied by a Notice of Availability, per § 92.11(c)(5)(i), which must be provided in multiple languages. While we have declined to require translation of the Notice of Nondiscrimination into a set number of languages, covered entities may still be required to provide translations when necessary to ensure meaningful access as required under § 92.201. OCR will provide a sample Notice of Nondiscrimination and may provide translations of the sample Notice of Nondiscrimination.85 Comment: Some commenters argued that the requirement for when and where the Notice of Nondiscrimination must be provided, § 92.10(a)(2), is too burdensome; others commented that it eases financial burdens compared to the 2016 Rule requirements, while also ensuring that people receive information about the covered entities’ civil rights obligations. Some commenters supported the requirement of prominent posting on websites, including because of the low cost, while another commenter observed that poor and rural areas sometimes cannot be reached by internet and described the need to reach historically underserved and marginalized populations. 85 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Translated Resources for Covered Entities, https://www.hhs.gov/civil-rights/forindividuals/section-1557/translated-resources/ index.html (translated Notice of Nondiscrimination. Statement of Nondiscrimination, and Taglines required by the 2016 Rule). PO 00000 Frm 00046 Fmt 4701 Sfmt 4700 Various commenters agreed with the proposal to provide the Notice of Nondiscrimination annually and upon request as opposed to the 2016 Rule’s ‘‘significant communications’’ 86 requirement, including because the current proposal is clearer than the 2016 Rule requirement. Others stated that OCR should require the Notice of Nondiscrimination in all significant communications, such as Explanations of Benefits and patient intake forms. Some opposed annual notices as costly and annoying to patients, recommending that notice instead be upon enrollment, upon request, and prominently in health care plan documents. Others argued for using the HIPAA model, which requires notice at first point of service and then upon request only. Response: In developing the points of contact at which a Notice of Nondiscrimination must be provided, OCR considered the concerns raised by covered entities regarding burden, consumer fatigue, and lack of clarity and specificity in prior requirements. However, we also considered comments that stated the Notice of Nondiscrimination is important to ensure that persons are informed of their civil rights and without this knowledge, including the right to language assistance services and effective communication, health disparities may continue to increase as they did during the COVID–19 pandemic. The provision is a reasonable and balanced approach that reduces the number of communications in which this essential notification is required compared to the 2016 Rule requirements,87 while preserving its necessary function. While OCR appreciates that many individuals lack internet access, we note that the regulation as drafted requires posting in physical locations, as well as being provided upon request, § 92.10(a)(2)(ii) and (iv); therefore, access to the Notice of Nondiscrimination is not dependent on internet access. Comment: Various commenters recommended that the Notice of Nondiscrimination be posted prominently where frontline employees can see it, and that it be in large sans serif font (at least 18-point font). Response: OCR appreciates these comments and the importance of ensuring that the Notice of Nondiscrimination posted in physical 86 87 FR 47852–53 (discussion in 2022 NPRM); 85 FR 37161–62, 37175 (discussion in 2020 Final Rule). 87 Id. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations locations can be seen and is accessible to individuals who may have low vision. For this reason, we are finalizing § 92.10(a)(2)(iv) to require that posted notices be in a sans serif font, no smaller than 20-point font.88 Comment: Several commenters argued that the Notice of Nondiscrimination and Notice of Availability must be provided together, because they are so intertwined, adding that this may also reduce the burden for covered entities. Response: OCR appreciates this comment and directs commenters to the requirement at § 92.11(c)(5)(i), which requires that the Notice of Availability be provided with the Notice of Nondiscrimination. Covered entities may choose to integrate the Notice of Availability into its Notice of Nondiscrimination. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.10, with modifications. OCR is revising the explanatory parenthetical for sex at § 92.10(a)(1)(i) to read ‘‘consistent with the scope of sex discrimination described at § 92.101(a)(2).’’ We are also providing a technical revision to § 92.10(a)(1)(iii) to replace ‘‘necessary’’ with ‘‘a reasonable step’’ for consistency with the standard articulated in § 92.201(a), that ‘‘[a] covered entity must take reasonable steps to provide meaningful access to each individual with limited English proficiency (including companions with limited English proficiency) eligible to be served or likely to be directly affected by its health programs and activities.’’ We are revising § 92.10(a)(2)(iv) to require that posted notices be provided ‘‘in no smaller than 20-point sans serif font.’’ Finally, we are making a technical revision to replace ‘‘limited English proficient individual’’ with ‘‘individual with limited English proficiency,’’ consistent with modifications elsewhere. Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11) In § 92.11, we proposed requiring covered entities to notify the public of the availability of language assistance services and auxiliary aids and services for their health programs and activities (‘‘Notice of Availability’’). In § 92.11(a), we proposed requiring a covered entity to provide a notice that, 88 See Am. Council of the Blind, Best Practices and Guidelines for Large Print Documents Used by the Low Vision Community (2011), https:// archive.org/details/bestpracticesgui00coun. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 at minimum, states that the covered entity provides language assistance services and appropriate auxiliary aids and services free of charge in its health programs and activities, when necessary for compliance with section 1557 or the part. This notice must be provided to participants, beneficiaries, enrollees, and applicants of the covered entity’s health program or activity, and members of the public. In § 92.11(b), we proposed requiring the Notice of Availability to be provided in English and at least the 15 most common languages spoken by individuals with LEP of the relevant State or States, and in alternate formats for individuals with disabilities who require auxiliary aids and services to ensure effective communication. In § 92.11(c), we proposed requiring the notice be provided on an annual basis to participants, beneficiaries, enrollees (including late and special enrollees), and applicants, and upon request at any time; we also proposed that the notice be provided online (when applicable) and in a clear and prominent physical location where it is reasonable to expect individuals seeking services from the health program or activity to be able to read or hear the notice. In § 92.11(c)(5), we proposed a list of specific electronic and written communications that the Notice of Availability must accompany. We invited comment as to whether requiring a Notice of Availability for all Explanation of Benefit (EOB) documents is the most appropriate approach, balancing the burden of providing Notices of Availability with all EOBs against the burdens associated with determining which EOBs must include the notice. In § 92.11(d), we proposed alternative, optional methods by which a covered entity may be deemed in compliance with proposed § 92.11(a). We sought comment on whether the Notice of Availability requirement as proposed is practical and responsive to concerns raised regarding the 2016 and 2020 Rules, including the sufficiency of the content of the Notice of Availability and requirements for when and where covered entities must provide the notice. We also invited comment as to whether the proposed requirements adequately address the specific concerns raised regarding the burdens associated with the 2016 Rule requirements by providing a list of specific documents with which the Notice of Availability must be provided. Additionally, we invited comment on how to best provide the Notice of Availability to individuals with disabilities to ensure they know how to PO 00000 Frm 00047 Fmt 4701 Sfmt 4700 37567 request and receive relevant materials and documents in formats that meet their disability-related needs, and whether covered entities should be required to provide the Notice of Availability in sign language. Similarly, we sought comment on how to best provide the Notice of Availability to individuals with LEP, including individuals with LEP with disabilities, to ensure they know how to request and receive language assistance services and auxiliary aids and services to provide meaningful access to relevant materials and documents. We also sought comment on whether the proposed list of electronic and written communications that the Notice of Availability must accompany adequately captures the documents for which individuals with LEP and individuals with disabilities should receive the Notice of Availability. We further invited comment on the anticipated costs to covered entities of various sizes to comply with the proposed requirements. The comments and our responses regarding § 92.11 are set forth below. Comment: Many commenters stated that the Notice of Availability is needed because people are unaware of their rights to language assistance and auxiliary aids and services, leaving them unable to advocate for themselves and leading to health disparities. Commenters agreed that the 2019 NPRM and 2020 Rule fail to address the costs borne by participants, beneficiaries, and enrollees in the absence of notice, and the additional costs to the health care system that could result. 87 FR 47853. Many commenters provided examples of how individuals with LEP experience disparities in health care, including poor care and outcomes; higher uninsured status; lower health literacy; longer hospital stays; greater difficulty understanding health instructions; and general health care underuse. The commenters emphasized that providing Notice of Availability is the most essential element to decreasing language barriers and that with proper notice of their rights, health disparities for individuals with LEP would be reduced. Response: OCR appreciates commenters highlighting the importance of providing individuals with LEP notice of their right to receive language assistance services, and the negative consequences of failure to do so. As discussed, OCR considered the concerns raised in response to the 2019 NPRM and 2020 Rule’s failure to include a similar notice provision, as well as concerns raised in response to the 2016 Rule’s notice provision. As proposed and finalized, § 92.11 provides E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37568 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations an appropriate balance between the approaches of these prior rules and is an important tool for combatting and preventing health disparities based on communication barriers. Comment: Numerous commenters stated that the requirement to provide the Notice of Availability in 15 nonEnglish languages was too many, providing examples of places in which they believe fewer languages were needed. For example, one provider commented that in California, 95 percent of their communications were requested in the top five languages in the State, therefore translations into the top five languages would be sufficient. Other commenters noted that smaller entities would be particularly burdened by the proposed standards. One commenter stated that requiring pediatric dental offices to offer the Notice of Availability as proposed would be burdensome and cause confusion. Conversely, many other commenters stated that 15 languages is too few and that, under the proposed requirements, the Notice of Availability would not reach enough individuals with LEP, giving examples of language populations that would not be reached. Some commenters expressed a belief that covered entities should ensure each individual with LEP receives information about their rights in their preferred language, and that a 15language requirement would not adequately provide that assurance. Some commenters stated that the identification of languages required should not be determined at the State level but should instead be based on the covered entity’s entire program area in various states. On the other hand, some commenters expressed that the required languages should always be determined at the State level only, rather than ‘‘State or States.’’ Commenters said that because OCR will provide model notices translated into the required languages, and because of the need for meaningful notice of auxiliary aids and language assistance services, the burden for providing notices in the top 15 languages per State is lessened and reasonable. A few local government commenters stated that their jurisdiction currently requires translation in more than 100 languages and recommended that this rule incorporate State and local norms. Response: In determining the formula for the Notice of Availability translation requirement, OCR considered the 2016 Rule requirement, evaluated nationaland State-level language proficiency data issued by the U.S. Census Bureau VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 (Census), as well as potential the costs and burdens for covered entities. The need to provide individuals with LEP notice of the availability of language assistance services remains clear and there is ample evidence that failure to provide meaningful language access in a health care setting can lead to higher costs to the health care system and have grave consequences to individuals with LEP. 87 FR 47853–54. Since the ACA was enacted, the percentage of the U.S. population with LEP (defined as those who speak English less than ‘‘very well,’’ as collected by the Census) has remained at roughly 10 percent.89 OCR has received complaints and entities have sued the Department for rescinding the 2016 Rule’s notice requirements.90 Litigants in Chinatown Services Center v. U.S. Department of Health & Human Services raised specific concerns that older members of the Asian American, Native Hawaiian, and Pacific Islander community, who have high rates of limited English proficiency, experienced disparities because they are not aware of their right to receive language assistance services or how to raise a concern when such services are not provided.91 Although one Federal court ultimately held that a plaintiff health system was not likely to prevail on the merits of its Administrative Procedure Act challenge to the 2020 Rule’s repeal of the 2016 Rule’s notice requirements, the court notably acknowledged that a consequence of the 2020 Rule was that the plaintiff health system provided ‘‘costlier and more difficult treatment’’ because patients with LEP likely received inadequate health care elsewhere and arrived to their system sicker than they otherwise may have.92 OCR appreciates concerns regarding proposed § 92.11, which would require a covered entity operating in all 50 States to aggregate the populations with LEP across those States to determine the top 15 languages spoken by individuals with LEP in its service area. While this may result in a failure to reach some in89 U.S. Bureau of Census, Sandy Dietrich & Erik Hernandez, Language Use In the United States: 2019, Am. Community Survey Reports, p. 4 (2022), https://www.census.gov/content/dam/Census/ library/publications/2022/acs/acs-50.pdf. 90 See Compl., Chinatown Serv. Ctr. v. U.S. Dep’t of Health & Hum. Servs., No. 1:21–cv–00331 (D.D.C. Feb. 25, 2021), Compl., Whitman-Walker Clinic v. U.S. Dep’t of Health Hum. Servs., No. 1:20–cv– 01630 (D.D.C. June 22, 2020) and see 87 FR 47853– 54. 91 Compl., Chinatown Serv. Ctr. v. U.S. Dep’t of Health & Hum. Servs., No. 1:21–cv–00331, 22–35 (D.D.C. Feb. 25, 2021). 92 Whitman-Walker Clinic v. U.S. Dep’t of Health & Hum. Servs., 485 F. Supp. 3d 1, 30 (D.D.C. 2020). PO 00000 Frm 00048 Fmt 4701 Sfmt 4700 State LEP populations due to geographical variances, no single formula, including a State-level formula, will cover all individuals with LEP. However, this formula would cover a significant majority (over 93 percent) of individuals with LEP, even for covered entities that operate on a national level.93 Thus, while OCR appreciates the request to increase the number of languages into which the Notice of Availability must be translated, we have determined that this would likely increase burdens while yielding additional coverage of marginally few individuals with LEP. However, covered entities are reminded that they must still take reasonable steps to provide meaningful access to all individuals with LEP, regardless of whether the individual’s primary language is one of the 15 most frequently spoken nonEnglish languages in their State or States, per § 92.201. Further, nothing in this rule prevents jurisdictions from requiring that the Notice of Availability be translated into more languages; covered entities wishing to provide more languages may also do so. OCR recognizes concerns raised in the comments regarding the potential cost of translating the Notice of Availability into the required languages. To offset this concern, OCR has provided translations of the model Notice of Availability in the top 15 languages in each State, at www.hhs.gov/1557. Additionally, § 92.11(c) reduces the number of documents for which provision of the translated notices is required from the 2016 Rule, and § 92.11(d) provides two options for how a covered entity may otherwise meet the requirements of this provision. OCR anticipates that efficiencies created by this formula—complemented by the availability of OCR-translated Notices of Availability—will benefit covered entities and the communities they serve. These benefits will reduce harmful impacts of the failure to take reasonable steps to provide meaningful access— such as unnecessary hospital readmissions, lower rates of outpatient follow up, limited use of preventive services, poor medication adherence, and lack of understanding of discharge 93 U.S. Census Bureau, Am. Community Survey 5Year Estimates Public Use Microdata Sample 2020 for the 50 States and DC (2000), ACS 5-Year Estimates Public Use Microdata Sample 50 States & DC; https://data.census.gov/mdat/#/ search?ds=ACSPUMS5Y2020& cv=ENG&rv=ucgid,LANP&wt= PWGTP&g=0400000US01,02,04,05,06,08,09, 10,11,12,13,15,16,17,18,19,20,21,22, 23,24,25,26,27,28,29,30,31,32, 33,34,35,36,37,38,39,40,41,42, 44,45,46,47,48,49,50,51,53,54,55,56. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations instructions 94—thereby alleviating burdens on community organizations that have been providing notice of language access as well as providers who have seen negative impacts such as increased costs and sicker patients since the repeal of the 2016 Rule’s notice requirements. See 87 FR 47853–54. Given these efforts, the requirement of providing notice of language access rights is not overly burdensome when balanced with the need to provide notice of the availability of language assistance services to individuals with LEP. Comment: A few commenters suggested that a hybrid method should be used to calculate which languages are required for translation under this provision, such as the higher or lower of a percentage or absolute number (for example, a threshold of five percent or 1,000 individuals with LEP, whichever is lower). Some commenters recommended OCR adopt the standard found in Tri-Departmental regulations at 26 CFR 54.9815–2719(e), 29 CFR 2590.715–2719(e), and 45 CFR 147.136(e), which applies a county-level formula and is applicable to the internal claims and appeals and external review processes for group health plans and health insurance issuers in the group and individual health insurance markets, to decrease costs and avoid confusion. Some added that a hybrid method, such as allowing for calculations at the county- instead of State-level, is especially critical for small practices operating at only the county level. They stated these practices may not have resources to translate the Notice of Availability into the top 15 languages spoken in the State and may serve language communities that are different from those represented by the top 15 languages at the State-level. Response: OCR appreciates these suggestions but, as we discussed in the Proposed Rule, OCR declined to adopt a population threshold due to variances among urban and rural communities. 87 FR 47855. We are concerned about similar results if a percentage threshold is used, and we decline to adopt this approach. While OCR appreciates that some covered entities will have to comply with both OCR and Tri-Departmental regulations, we decline to adopt the county-level formula found in the referenced Tri-Departmental regulations, 26 CFR 54.9815–2719(e), 29 CFR 2590.715–2719(e), and 45 CFR 94 See Neelam H. Ahmed et al., Moderation of the Association Between Primary Language and Health by Race and Gender: An Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 (2022), https://www.mdpi.com/1660-4601/19/13/7750. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 147.136(e), which provides that a nonEnglish language is an applicable nonEnglish language if ten percent or more of the population residing in the county is literate only in the same non-English language, as section 1557 applies to a wider range of covered entities, communications, and individuals with LEP. We will continue to monitor issues related to this area and work with CMS as appropriate in the future to ensure compliance. Comment: Some commenters suggested that OCR work with covered entities and community groups to develop additional effective ways to inform individuals with LEP about their language access rights. A health insurance entity suggested convening a stakeholder process to develop and test a pilot with easy-to-understand, universal language access symbols to connect persons with LEP to language assistance services. Response: OCR appreciates this recommendation and welcomes the opportunity to collaborate with covered entities and community groups to develop effective means for informing individuals with LEP of their language access rights. Comment: Many commenters supported the list of documents requiring a Notice of Availability in § 92.11(c), emphasizing the critical importance of clear communications in health care settings. Some commenters noted the provision fills information gaps and that receiving information multiple times is sometimes needed for effective notice, particularly for older adults. Others expressed support for the balanced approach of including opt-out provisions so that covered entities are not overly burdened, but participants and beneficiaries know their rights. Several commenters urged OCR to add medical bills to the list, providing examples of negative impacts of bills being sent without notice of how to access effective communication. Many other commenters expressed concerns about administrative burdens and costs of notice in relation to the number of communications in which the Notice of Availability would be required under § 92.11(c), while others pointed out that the list is effectively shorter than in the past. Several commenters wrote generally about language assistance services and auxiliary aids and services, with some asking for flexibility in the language access rules to allow for translation of the most important documents with the provision of oral interpretation for other information. Another argued that translation and interpretation as well as auxiliary aids and services rules should PO 00000 Frm 00049 Fmt 4701 Sfmt 4700 37569 not apply to physician practices or health centers. Others requested that health insurance issuers or the Federal Government reimburse providers for disseminating these items. Response: We appreciate the comments and believe that the list of documents identified in § 92.11(c), which provides clarity and prioritizes inclusion of the Notice of Availability in critical health care documents, strikes the appropriate balance between potential burdens to covered entities and the benefits to individuals with LEP and individuals with disabilities. OCR appreciates commenters raising concerns regarding the accessibility of medical billing, which can have longterm negative financial impacts on patients.95 Similarly, accessible notices of expected costs and benefits, such as the good faith estimate, can help patients make informed, cost-conscious decisions about their care and reduce the risk of unexpected medical bills.96 The potential financial impact of making these estimates accessible is particularly significant for individuals with LEP and individuals with disabilities who are uninsured (or selfpay), because these individuals have the right to dispute medical bills that are substantially in excess of the expected charges on their good faith estimate 97 and exercise of this right depends on the ability of such individuals to understand both their good faith estimates and their medical bills. For these reasons, we are adding § 92.11(c)(5)(ix), which requires a covered entity to provide its Notice of Availability along with billing-related documents and reads: ‘‘Communications related to the cost and payment of care with respect to an individual, including medical billing and collections materials, and good faith estimates required by section 2799B–6 of the Public Health Service Act.’’ Comment: Regarding an alternative, optional means of compliance at § 92.11(d), one covered entity commenter requested that OCR specify that entities in compliance with other 95 See NPR, Lauren Weber & Hannah Recht, Medical Bills Remain Inaccessible for Many Visually Impaired Americans, Health, Inc. (Dec. 1, 2022), https://www.npr.org/sections/health-shots/ 2022/12/01/1139730806/blind-disabilityaccessibility-medical-bills (discussing an investigative news report and including an OCR investigation). 96 Internal Revenue Code section 9816(f), ERISA section 716(f), and PHS Act section 2799A–1(f), as added by section 111 of title I of division BB of the Consolidated Appropriations Act, 2021 (CAA); PHS Act section 2799B–7, as added by section 112 of title I of division BB of the CAA; 45 CFR 149.610. 97 PHS Act section 2799B–6, as added by section 112 of title I of division BB of the CAA; 45 CFR 149.620. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37570 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Department requirements related to language access and auxiliary aids are deemed to have complied with section 1557. One commenter stated that the Notice of Availability should be combined with the Notice of Nondiscrimination, as well as HIPAA notices; another suggested OCR work with CMS and other HHS agencies to leverage existing practices and make these requirements technically operational. Response: As discussed elsewhere, OCR appreciates that covered entities may have compliance requirements under other Department regulations similar to those found in this provision. However, given the range of health programs and activities to which section 1557 and the part apply—including those where inaccessible communication can have life-or-death consequences—it is imperative to have an independent requirement. Covered entities’ compliance with § 92.11(b) will increase the likelihood of compliance with similar Department translation requirements. While we appreciate commenters’ suggestion to combine the Notice of Availability with the Notice of Nondiscrimination and the HIPAA notices, § 92.11(c)(5) requires the Notice of Availability to additionally be included with a list of important health care documents because the ability of patients to avail themselves of language access services is foundational to improving health outcomes for individuals with LEP. OCR will therefore maintain this requirement under § 92.11(c)(5) for covered entities. Comment: Various commenters expressed support for the alternate compliance provisions found in § 92.11(d). One group raised the idea of an ‘‘opt-in’’ provision, in which individuals with LEP would have to state that they want Notice of Availability, in lieu of the proposed optout provision, and sought clarification about whether the opt-out provision can be combined with Notice of Availability. Some commenters argued that the alternate compliance options could be difficult to implement and lead to additional costs, cause confusion, or be generally burdensome, with one commenter stating they would be more burdensome than the 2016 Rule requirements because they require customizing documents. One commenter requested OCR delay implementation of the opt-out provision until 2024; other commenters suggested replacing the option with a less burdensome approach, asking that it be only electronic. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 On the other hand, commenters stated that the opt-out provision strikes a reasonable balance that is effectively narrower than the 2016 Rule’s ‘‘significant communications’’ requirement. Another commenter agreed, commenting that the proposal could be both more consumer friendly and helpful, as well as less duplicative and costly than the 2016 Rule. One commenter encouraged OCR to provide robust oversight of opt-out processes in order to protect civil rights. Response: OCR appreciates the range of comments received on this new provision. We emphasize that the options included in § 92.11(d) are options, and not requirements. Thus, we appreciate that covered entities may wish to have a delayed applicability date, to pursue these options only through electronic means, or not pursue them at all. OCR is not requiring any actions under § 92.11(d) be taken; rather, OCR is providing alternate means to satisfy the requirements of § 92.11 without including the full Notice of Availability with all communications listed at § 92.11(c). OCR declines to make further changes clarifying that a person should only be asked about their language needs once, because § 92.11(d)(1) permits this if the individual exercises the option to optout. Moreover, § 92.11(d)(2) allows a covered entity to document an individual’s primary language, any appropriate auxiliary aids and services, and to communicate with them in that manner. OCR intends to provide robust review of opt-outs, as well as technical assistance, to ensure that covered entities that choose to exercise this option do so in a manner consistent with the requirements at § 92.11(d). Comment: Many commenters submitted recommendations to increase guarantees of accessibility of the Notice of Availability for individuals with disabilities, such as requiring that: (1) notices be provided in large sans serif print, at a minimum of 18-point font; (2) notices be on the first page or otherwise at the beginning of documents or publications; (3) the needs of persons who are illiterate be taken into account through provision of audio or video notices; (4) all written notices be in plain language (fourth grade reading level), accompanied by visual aids when practicable; and (5) notice should be provided via audio, video, and American Sign Language. A coalition also discussed recommendations to ensure effective communication. Other accommodations recommended included: (1) screen readers and audio/ video accessibility; (2) alternatives to PO 00000 Frm 00050 Fmt 4701 Sfmt 4700 braille (e.g., large print, qualified reader) because braille may not be economically feasible for all entities; (3) accessible tagline requirements or cross-references to language access rights; and (4) ‘‘Easy Read’’ text, images, brief sentences, large and simple fonts, and location on the first page. Many also commented that the Notice of Availability should be posted where frontline employees can readily see it, that employees should be trained to provide it, and that it be available upon request. Various commenters urged that covered entities must proactively ask people if they have communications barriers. Further, commenters stated that primary consideration should be given to what a person with a disability asks for in terms of auxiliary aids or services. Another commenter added that provision of the notice should be clarified so it applies to listening devices and the other range of auxiliary aids. Response: OCR appreciates all the suggestions and reminds commenters and others that the meaningful access and effective communication requirements (§§ 92.201 and 92.202, respectively) regarding the provision of language access and auxiliary aids apply to the Notice of Availability. Covered entities have existing effective communication obligations under section 504 and section 1557, which may include providing the notice in an alternate format or providing another auxiliary aid or service. Thus, if an individual is in need of the notice in an alternate format or through another auxiliary aid or service, that would likely already be required when it is necessary to ensure effective communication. We decline to affirmatively require the notice be provided in any additional formats at this time. However, OCR agrees that larger print should be required to ensure the accessibility of the Notice of Availability when posted in physical locations, and that this requirement is relatively straightforward to implement; accordingly, § 92.11(c)(4) has been amended to require print no smaller than 20-point in a sans serif font. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.11, with modifications. We are revising § 92.11(b) to clarify the relevant State or States are those ‘‘in which a covered entity operates.’’ We are modifying § 92.11(c)(4) to clarify that posted notices be provided ‘‘in no smaller than 20-point sans serif font.’’ We are adding E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 § 92.11(c)(5)(ix) to read: ‘‘Communications related to the cost and payment of care with respect to an individual, including medical billing and collections materials, and good faith estimates required by section 2799B–6 of the Public Health Service Act.’’ We are also making technical revisions, including replacing ‘‘limited English proficient individual’’ with ‘‘individual with limited English proficiency,’’ consistent with modifications elsewhere. Data Collection We solicited comments on requiring covered entities to collect additional data, beyond those required by the referenced statutes and their regulations, on race, ethnicity, language, sex, gender, gender identity, sexual orientation, disability, and age, to inform a final rule and OCR’s overall civil rights work. We also sought comment on whether covered entities are already collecting disaggregated demographic data in their health programs and activities and, if so, for which categories of data, through what systems, and at what cost. We also invited comment on how a section 1557 civil rights data collection requirement could impact current data collection efforts, either positively or negatively. We also requested comment on whether the adoption of a regulatory standard for a recurring civil rights data collection would benefit civil rights enforcement, as well as how frequently the data should be submitted to OCR. We also sought comment on whether the data collection requirements should vary by type of entity, as recipients of Federal financial assistance include a variety of entities, including State and local agencies, health insurance issuers, providers, health care facilities and clinics, hospitals, Federally Qualified Health Centers, and health-related educational and training programs. Accordingly, we invited comment on which types of recipients (if any) should be covered; if recipients under a certain size should be exempt from the data collection requirement, and if so, whether that exemption should be based on employee number, the number of beds (if relevant), or some other metric; what types of data should be collected; what definitions should be used; the potential costs associated with such a requirement; and the potential benefits of such a requirement. The comments and our responses regarding data collection are set forth below. Comment: Some commenters recommended that OCR not mandate the collection of data, with some VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 strongly suggesting that we minimize provider burden and utilize existing data collection systems. Response: OCR is not including a data collection requirement in the final rule. OCR has the authority independent of this rulemaking to conduct data calls to ensure recipient compliance with Federal civil rights laws.98 OCR is actively engaged with other agencies within the Department and throughout the Federal Government related to responsible data collection and recognizes the importance of data collection to meet its mission. We will continue to work with covered entities and beneficiaries to determine whether an additional data collection requirement is needed in a future rulemaking. Comment: Some commenters recommended that OCR adopt data collection standards. They noted that with any demographic data collection requirement, OCR must provide appropriate training and technical assistance resources to programs and grantees and make clear that data cannot be used for negative actions such as immigration or law enforcement, redlining, or targeting of specific groups. Response: OCR appreciates the comments regarding standards and safeguards to ensure that programs and grantees have the appropriate training. OCR also understands the concerns that some commenters have regarding data being used for adverse actions. While OCR is not including a data collection requirement in the final rule, OCR will continue to research the benefits of civil rights data collection and how to mitigate potential negative impacts. Comment: Some commenters urged OCR to require covered entities to collect data regarding a core set of disaggregated categories to include race, ethnicity, language, sex, gender, gender identity, sexual orientation, pregnancy status, sex characteristics, disability, and age from patients and providers. Commenters stated that data are essential to identify and address unmet needs, and for many populations data remain largely uncollected. Some commenters also noted that collecting disaggregated data could allow OCR to distinguish the impact of intersectional discrimination on those seeking access to health care. Some commenters also urged that if individuals volunteer such information, it should be self-reported to ensure accuracy and privacy. Response: OCR agrees that better standards and practices for collecting data can have a positive impact on reducing disparities. OCR will continue 98 See, PO 00000 e.g., 45 CFR 80.6(b). Frm 00051 Fmt 4701 Sfmt 4700 37571 to work to ensure that any civil rights data collection yields accurate data that adequately protects the privacy of individuals. Summary of Regulatory Changes For the reasons set forth above and considering the comments received, we are finalizing the rule without a data collection provision. Subpart B—Nondiscrimination Provisions In subpart B, OCR proposed provisions related to the prohibition of discrimination on the basis of race, color, national origin, sex, age, and disability in covered health programs and activities. Discrimination Prohibited (§ 92.101) In § 92.101(a), we proposed a general prohibition of discrimination on the basis of race, color, national origin, sex, age, or disability under any health program or activity to which section 1557 or the part applies and provided additional detail regarding what constitutes discrimination on the basis of sex. In § 92.101(a)(1), we proposed general prohibitions on discrimination under section 1557 by restating the core objective of section 1557. In § 92.101(a)(2), we clarified that discrimination on the basis of sex includes discrimination on the basis of sex stereotypes; sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; and gender identity. In § 92.101(b), we identified several specific forms of prohibited discrimination under section 1557. Proposed § 92.101(b)(1)(i) specifically referred to recipients of Federal financial assistance and State Exchanges; proposed § 92.101(b)(1)(ii) referred to the Department’s health programs and activities, including Federally-facilitated Exchanges. In § 92.101(b)(2), we proposed that the enumeration of specific forms of discrimination in 92.101(b) does not limit the general application of the prohibition in proposed § 92.101(a). The comments and our responses regarding § 92.101 are set forth below. Comment: Numerous commenters supported the Proposed Rule’s nondiscrimination provisions, stating that these provisions would promote the health equity for communities of color and increase access to coverage and care for those who have been historically underserved because of race, ethnicity, language, age, disability, and sex. Many commenters stated that OCR should finalize the provisions without delay. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37572 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Another commenter supported the proposed discrimination prohibitions as consistent with the ACA, and another requested that more support be provided for educating the public about the nondiscrimination obligations of health programs and activities. Response: OCR agrees that the nondiscrimination provisions are one important tool to address health disparities and advance health equity. OCR will continue to provide technical assistance and public education related to compliance with section 1557 and encourages covered entities to continue to visit our website for technical assistance materials. Comment: Numerous commenters stated that section 1557’s explicit prohibition on discrimination based on multiple grounds fills a critical gap by protecting patients who may experience multiple forms of discrimination. Commenters provided numerous examples of simultaneous discrimination on more than one protected basis, including, but not limited to, discrimination against LGBTQI+ individuals of color, with disabilities, with LEP, or who are immigrants; and Black and Hispanic/ Latino older adults. Numerous commenters recommended that OCR revise § 92.101(a)(1) to include ‘‘or any combination thereof’’ to explicitly account for intersectional discrimination within the regulatory text. Response: OCR agrees that simultaneous discrimination on multiple prohibited bases, is important to account for and is prohibited by section 1557. As we noted in the Proposed Rule, a recent study examined disability and pregnancy as intersecting traits and how this may impact risk for maternal morbidity and mortality, underscoring the importance of ensuring nondiscrimination against women with disabilities. 87 FR 47837. The Proposed Rule also provided information regarding Black maternal health and the alarming disparities in maternal mortality rates for Black women and American Indian/Alaska Native women. 87 FR 47832. Therefore, to account for the fact that individuals can experience discrimination based on two or more protected bases (race, color, national origin, sex, age, and disability), we have amended the language of § 92.101(a)(1) to include ‘‘or any combination thereof.’’ This language has also been amended throughout the final rule for consistency. The addition intends to clarify that an individual is protected from discrimination on more than one VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 protected basis that occurs at the same time. Comment: A commenter provided a discussion of the harms and unaddressed discrimination faced by patients with rare diseases and requested that OCR explicitly prohibit discrimination against patients with rare diseases. Some commenters requested that specific recognition also be made for patients with liver diseases. A commenter requested that the proposed regulatory text or accompanying guidance provide examples of discrimination on the basis of disability. Response: Discrimination against an individual with a rare or specific disease that meets the definition of ‘‘disability’’ will be addressed under section 1557’s prohibition on discrimination on the basis of disability, which already appears in the rule. The commenter’s request for further guidance will be taken into consideration. For additional information related to disability discrimination, please see the discussions under subpart C. OCR also provides guidance and examples, as well as answers to frequently asked questions related to disability discrimination on our website. Comment: A number of commenters asked that vaccination status be added as a ground of prohibited discrimination, stating that their right to make their own health care decisions should be protected. Response: Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, and disability. To the extent vaccination status is not related to these prohibited bases of discrimination specified by Congress in section 1557, we decline to include it as a ground of prohibited discrimination under this rule. Comment: Some tribal organizations recommended that OCR acknowledge American Indian/Alaska Native (AI/AN) people as holding a political classification as compared to a racebased classification and to exempt Tribal health programs from the final rule. These commenters stated that recognizing the political classification of AI/AN people allows AI/AN providers to only serve AI/AN patients, which commenters said is necessary because of logistical capacity constraints. Response: As discussed at § 92.2, OCR recognizes the unique relationship between the United States and federally recognized tribal entities. Federal Government preferences based on an individual’s membership or eligibility in a federally recognized tribal entity are based on political classifications. Such classifications are not race-based. As PO 00000 Frm 00052 Fmt 4701 Sfmt 4700 such, preferences on this basis do not violate the Equal Protection Clause,99 title VI,100 or section 1557. As discussed at § 92.2, preferences based on the unique relationship between the United States and federally recognized Tribes are distinct from the protections afforded under Federal civil rights laws, which protect all individuals from discrimination on the basis of race, color, or national origin (including AI/ AN individuals, regardless of tribal enrollment or affiliation). This final rule adopts by reference the Department’s title VI regulatory provision at 45 CFR 80.3(d), which provides that an individual shall not be deemed subjected to discrimination by reason of their exclusion from benefits limited by Federal law—such as the Indian Health Service—to individuals of a different race, color, or national origin. OCR will fully apply this provision as well as other applicable exemptions or defenses that may exist under Federal law. OCR intends to address any restrictions on application of section 1557 to Tribal entities in the context of individual complaints or compliance reviews. Comment: A commenter suggested that nondiscrimination protections should be extended to health care workers, indicating that health care workers often experience discrimination, especially on the basis of race and that additional protections are needed. Response: While OCR acknowledges that health care workers can face discrimination as they provide health care, OCR does not have jurisdiction over patients who may discriminate against health care workers, as patients are not covered entities under section 1557. Separately, and as previously noted, OCR does not intend for this rule to apply to employment discrimination. If OCR receives a complaint from a health care worker, we will determine if we have jurisdiction to investigate. Complaints received by OCR from health care workers alleging discrimination experienced in the context of employment will be referred to an appropriate agency, per §§ 92.303(b) and 92.304(a) (incorporating 45 CFR 85.61(e)), as this regulation does not apply to employment practices. Comment: Many commenters expressed support for the explicit references to discrimination on the basis of sex stereotypes; sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; and gender identity as forms of 99 See 100 45 E:\FR\FM\06MYR4.SGM Morton v. Mancari, 417 U.S. 535 (1974). CFR 80.3(d). 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 discrimination on the basis of sex in § 92.101(a)(2). Commenters pointed to evidence of health disparities and barriers to accessing health care faced by LGBTQI+ people, and how ongoing health care discrimination contributes to higher rates of substance use, mental health conditions, HIV, cancer, and cardiovascular disease for LGBTQI+ people relative to non-LGBTQI+ people.101 Several commenters stated that § 92.101(a)(2)’s prohibitions should be mirrored in the CMS regulations addressed in section IV. Response: It is well documented that LGBTQI+ people face significant health disparities and barriers to health care and insurance coverage,102 and section 1557’s protections are critical tools to combat those disparities. We appreciate commenters’ view that CMS regulations within this rulemaking should mirror the language provided in § 92.101(a)(2), and we refer readers to section IV (CMS Amendments). Comment: A number of comments addressed discrimination in the context of organ transplantation. Several commenters noted that people with disabilities are routinely denied access to organ transplants due to stereotypical assumptions about compliance with post-operative care and policies that deny transplants to otherwise eligible individuals with disabilities.103 Several commenters noted that existing practices in organ transplants appear to discriminate against Black, Hispanic/Latino, and Native American/ Alaska Native individuals, as those 101 See, e.g., Charlotte Patterson et al., Nat’l Acads. of Sci., Eng’g, & Med., Understanding the Well-Being of LGBTQI+ Populations (2020), https:// doi.org/10.17226/25877; Lambda Legal, When Health Care Isn’t Caring: Lambda Legal’s Survey of Discrimination Against LGBT People and People with HIV (2010), www.lambdalegal.org/health-carereport; Cornell Univ., What Does the Scholarly Research Say about the Effects of Discrimination on the Health of LGBT People? (2019), https:// whatweknow.inequality.cornell.edu/topics/lgbtequality/what-does-scholarly-research-say-aboutthe-effects-of-discrimination-on-the-health-of-lgbtpeople/. 102 See, e.g., Sharita Gruberg et al., Ctr. for Am. Progress, The State of the LGBTQ Community in 2020 (2020), https://www.americanprogress.org/ issues/lgbtq-rights/reports/2020/10/06/491052/ state-lgbtq-community-2020/; Sandy E. James et al., Nat’l Ctr. for Transgender Equality, The Report of the 2015 U.S. Transgender Survey, p. 97 (2016), https://transequality.org/sites/default/files/docs/ usts/USTS-Full-Report-Dec17.pdf. See also Caroline Medina et al., Ctr. For Am. Progress, Discrimination and Barriers to Well-Being: The State of the LGBTQI+ Community in 2022 (2023), https:// www.americanprogress.org/article/discriminationand-barriers-to-well-being-the-state-of-the-lgbtqicommunity-in-2022/. 103 See Nat’l Council on Disability, Organ Transplant Discrimination Against People with Disabilities (2019), https://www.ncd.gov/assets/ uploads/reports/2019/ncd_organ_transplant_ 508.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 individuals are more likely to develop end stage renal disease but are less likely to receive a kidney transplant than white individuals.104 Another commenter stated that providers may discriminate against immigrant patients during the assessment process by assuming they lack social support or the ability to care for themselves after organ transplantation, resulting in a denial of care.105 Response: Discrimination on the basis of disability and race in the provision of health care, including organ transplantation, is a continuing issue that limits opportunities for life-saving treatment. This final rule provides OCR with a powerful tool to help address this ongoing issue. While section 1557 does not prohibit discrimination on the basis of immigration status, section 1557’s protections apply regardless of someone’s citizenship or immigration status, and individuals who believe they have been discriminated against based on certain characteristics such as race, color, and national origin can file a complaint. We will continue to address discrimination in organ transplantation through robust enforcement of not only section 1557, but all Federal civil rights laws.106 Comment: Numerous commenters generally supported the inclusion of the prohibition of discrimination on the basis of gender identity and sexual orientation as prohibited types of sex discrimination in proposed § 92.101(a)(2). They maintained that inclusion was consistent with Bostock v. Clayton County, 590 U.S. 644 (2020), in which the Supreme Court held that title VII’s prohibition of discrimination because of sex includes discrimination on the basis of sexual orientation and gender identity. Commenters supported the application of the reasoning in Bostock to title IX by citing several cases, DOJ resource materials, and Executive Order (E.O.) 13988.107 104 See U.S. Renal Data System, 2021 Annual Report: End Stage Renal Disease ch. 1 (2021) (Figure 1.8); Hannah Wesselman et al., Social Determinants of Health and Race Disparities in Kidney Transplant, 16 Clin. J. Am. Soc’y Nephrol. 262, 262 (2021). 105 See Garyphallia Poulakou, Oscar Len & Murat Akova, Immigrants as Donors and Transplant Recipients: Specific Considerations, 45 Int. Care Med. 401 (2019), https://pubmed.ncbi.nlm.nih.gov/ 30701293/. 106 See, e.g., U.S. Dep’t Health & Hum. Servs., Off. for Civil Rts., OCR Resolves Disability Complaint of Individual Who Was Denied the Opportunity for Health Transplant List Placement (Feb. 12, 2019), https://www.hhs.gov/about/news/2019/02/12/ocrresolves-disability-complaint-individual-who-wasdenied-opportunity-heart-transplant-list.html. 107 E.O. 13988, 86 FR 7023 (Jan. 25, 2021). U.S. Dep’t of Justice, Title IX Legal Manual, https:// www.justice.gov/crt/title-ix. See, e.g., Grimm v. PO 00000 Frm 00053 Fmt 4701 Sfmt 4700 37573 Another commenter cited several cases stating that courts have treated title VII and title IX protections as consistent with one another in support of the application of Bostock to title IX.108 A few commenters cited City of Los Angeles Department of Water and Power v. Manhart, 435 U.S. 702 (1978), as indicating that, for decades, sex discrimination prohibitions have covered sex stereotypes. The commenters also cited several opinions from district courts and one appellate court as indicating that discrimination on the basis of gender identity, gender transition, sex stereotypes, or transgender status are, similarly, unlawful types of sex discrimination.109 Other commenters provided cites to numerous other cases as including gender identity and sexual orientation as characteristics protected by sex discrimination law.110 Conversely, several commenters stated that Bostock does not support § 92.101(a)(2) as written. Some commenters stated that Bostock defined sex to include only ‘‘biological distinctions between male and female’’ and used the term ‘‘transgender status’’ Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616–17 (4th Cir. 2020), as amended (Aug. 28, 2020), reh’g en banc denied, 976 F. 3d 399 (4th Cir. 2020), cert. denied, No. 20–1163 (June 28, 2021); B.P.J. v. W. Va. State Bd. of Educ., No. 2:21–CV–00316, 2021 WL 3081883, at *7 (S.D.W. Va. July 21, 2021); Koenke v. Saint Joseph’s Univ., No. CV 19–4731, 2021 WL 75778, at *2 (E.D. Pa. Jan. 8, 2021); Doe v. Univ. of Scranton, No. 3:19–CV–01486, 2020 WL 5993766, at *11 n.61 (M.D. Pa. Oct. 9, 2020). 108 See, e.g., Doe v. Snyder, 28 F.4th 103, 113–14 (9th Cir. 2022); Emeldi v. Univ. of Or., 698 F.3d 715, 725 (9th Cir. 2012); Franklin v. Gwinnett Cnty. Pub. Sch., 503 U.S. 60, 75 (1992); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020). 109 See Kadel v. Folwell, 620 F. Supp. 3d 339, 379 (M.D.N.C. 2022); Fain v. Crouch, 618 F .Supp. 3d 313, 326–27 (S.D.W. Va. 2022); Fletcher v. Alaska, 443 F. Supp. 3d 1024, 1027, 1030 (D. Alaska 2020); Flack v. Wisconsin Dep’t of Health Servs., 395 F. Supp. 3d 1001, 1019–22 (W.D. Wis. 2019); Boyden v. Conlin, 341 F. Supp. 3d 979, 1002–03 (W.D. Wis. 2018); Cf. Brandt by & through Brandt v. Rutledge, 2022 WL 3652745, at *2 (8th Cir. Aug. 25, 2022). 110 See, among others cited, Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 593, 616, 619 (4th Cir. 2020), reh’g en banc denied, 976 F.3d 399 (4th Cir. 2020); Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, 1049–50 (7th Cir. 2017); Fain v. Crouch, No. 3:20–0740, 2022 U.S. Dist. LEXIS 137084, at *35–36 (S.D. W. Va. Aug. 2, 2022); Scott v. St. Louis Univ. Hosp., No. 4:21–cv– 01270–AGF, 2022 U.S. Dist. LEXIS 74691, at *18 (E.D. Mo. Apr. 25, 2022); C.P. v. Blue Cross Blue Shield of Ill., 536 F. Supp. 3d 791, 793 (W.D. Wash. 2021); Flack v. Wis. Dep’t of Health Servs., 395 F. Supp. 3d 1001, 1014–15 (W.D. Wis. 2019); Boyden v. Conlin, 341 F. Supp. 3d 979, 997, 1002–03 (W.D. Wis. 2018); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 953 (D. Minn. 2018); Prescott v. Rady Children’s Hosp.-San Diego, 265 F. Supp. 3d 1090, 1098–1100 (S.D. Cal. 2017); Adams v. Sch. Bd. of St. Johns Cnty., 968 F.3d 1286, 1305 (11th Cir. 2020); Zarda v. Altitude Express, Inc., 883 F.3d 100, 112–13 (2nd Cir. 2018); Franchina v. Providence, 881 F.3d 32, 53–54 (1st Cir. 2018); Hively v. Ivy Tech, 853 F.3d 339, 340–41 (7th Cir. 2017). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37574 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations rather than ‘‘gender identity.’’ A commenter argued that title VII should be treated as distinct from title IX because title IX uses the term ‘‘on the basis of sex’’—language the commenter described as requiring more than ‘‘but for causation’’—while title VII uses ‘‘because of . . . sex.’’ Other commenters discussed title IX to support arguments that discrimination on the basis of sex does not include discrimination on the basis of sexual orientation or gender identity, and that title IX only protects people on the basis of ‘‘biological sex.’’ Some commenters cited to various cases in opposition to the inclusion of gender identity and sexual orientation in proposed § 92.101(a)(2), including State of Tennessee v. Department of Education, 615 F. Supp. 3d 807 (E.D. Tenn. 2022), to support the belief that agencies cannot rely on the reasoning in Bostock to interpret what constitutes sex discrimination under title IX. Another commenter stated that E.O. 13988 improperly expands the application of Bostock and cited Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016) in support. Some commenters stated that RFRA’s religious protections may supersede the sex discrimination protections described in Bostock, and one commenter cited Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, 565 U.S. 171 (2012), for the proposition that that First Amendment protections may supersede employment discrimination laws. Another commenter stated that OCR’s interpretation of what is prohibited sex discrimination is contrary to law, citing to Franciscan Alliance, Inc. v. Becerra 111 and Christian Employers Alliance v. EEOC.112 Response: Case law offers strong support for the position that sex discrimination under section 1557 includes discrimination on the basis of gender identity and sexual orientation. As previously noted, a body of developing case law explains how to identify unlawful sex discrimination. As part of its prohibition on sex discrimination, this rule prohibits discrimination against individuals who do not conform with stereotypical notions of how an individual is expected to present as male or female, regardless of gender identity. This is consistent with longstanding case law; 111 553 F. Supp. 3d 361 (N.D. Tex. 2021), amended, No. 7:16–cv–00108–O, 2021 WL 6774686 (N.D. Tex. Oct. 1, 2021), appeal docketed, No. 21– 11174 (5th Cir. Nov. 26, 2021); see also Franciscan All., Inc. v. Becerra, 47 F.4th 368 (5th Cir. 2022). 112 Christian Emp’rs All. v. EEOC, No. 21–cv– 00195, 2022 WL 1573689 (D.N.D. May 16, 2022). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 more than 30 years ago, a plurality of the Supreme Court held in Price Waterhouse that discrimination based on sex stereotypes was a prohibited form of sex discrimination. We have included a number of examples throughout the preamble discussion to help covered entities better understand their obligations. OCR is also committed to providing technical assistance to support compliance with this final rule and may consider additional guidance that may assist covered entities with their obligations. As noted in the Proposed Rule, the inclusion of ‘‘sexual orientation’’ and ‘‘gender identity’’ in § 92.101(a)(2) is consistent with the Supreme Court’s reasoning in Bostock. 87 FR 47858. Title IX and section 1557 prohibit discrimination ‘‘on the basis of sex.’’ 113 And the Bostock Court used the phrase ‘‘because of sex’’ and ‘‘on the basis of sex’’ interchangeably.114 Because the statutory prohibitions against sex discrimination in title VII and title IX are similar, the Supreme Court and other Federal courts look to interpretations of title VII to inform title IX.115 Thus, Bostock’s discussion of the text of title VII informs the OCR’s analysis of title IX and section 1557. Given the similarity in nondiscrimination language between title VII and title IX, many Federal courts that have addressed the issue have interpreted section 1557 and title IX consistent with Bostock’s reasoning.116 Since Bostock, three Federal courts of appeals have held that the plain language of title IX’s prohibition on sex discrimination must be read similarly to title VII’s prohibition.117 OCR agrees with the reasoning in these cases.118 113 20 U.S.C. 1681(a); 42 U.S.C. 18116. e.g., 590 U.S. 653, 662, 681. 115 See, e.g., Franklin v. Gwinnett Cnty. Pub. Sch., 503 U.S. 60, 75 (1992); Jennings v. Univ. of N.C., 482 F.3d 686, 695 (4th Cir. 2007); Gossett v. Okla. ex rel. Bd. Of Regents for Langston Univ., 245 F.3d 1172, 1176 (10th Cir. 2001). 116 See, e.g., Doe v. Snyder, 28 F.4th 103, 113–14 (9th Cir. 2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020); but cf. Adams v. Sch. Bd. of St. Johns Cnty, 57 F.4th 791, 811–15 (11th Cir. 2022) (en banc)). 117 See A.C. by M.C. v. Metro. Sch. Dist. Of Martinsville, 75 F.4th 760, 769 (7th Cir. 2023); Grabowski v. Ariz. Bd. Of Regents, 69 F.4th 1110, 1116–17 (9th Cir. 2023); Doe v. Snyder, 28 F.4th 103, 113–14 (9th Cir. 2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020), as amended (Aug. 28, 2020), cert. denied, 141 S. Ct. 2878 (Mem) (2020). 118 OCR acknowledges that at least one court has held that it would be a misapplication of Bostock to interpret the definition of ‘‘sex discrimination’’ under section 1557 and title IX to include gender identity and sexual orientation. In Neese v. Becerra, 640 F. Supp. 3d 668, the U.S. District Court for the Northern District of Texas held that the Department 114 See, PO 00000 Frm 00054 Fmt 4701 Sfmt 4700 Additionally, there is a significant amount of case law, pre-and postBostock that affirms that sex discrimination includes discrimination based on gender identity.119 We disagree with commenters’ assertion that the Court’s use of the term ‘‘transgender status’’ in Bostock, rather than ‘‘gender identity,’’ results in any meaningful distinction regarding protections afforded to transgender individuals or other individuals experiencing discrimination on the basis of their gender identity. The Court’s choice of language reflects that it was addressing the gender identity of the plaintiff before it, who was transgender, and does not preclude the case’s application to other gender identities. Indeed, even the dissent stated that ‘‘there is no apparent difference between discrimination because of transgender status and discrimination because of gender identity.’’ 590 U.S. at 686, n.6 (Alito, J. joined by Thomas, J., dissenting). Additional citations by those opposing the language in § 92.101(a)(2) are either not applicable, already discussed in the Proposed Rule, or outdated. To begin, this rule does not misapplied Bostock when it issued a public notice, 86 FR 27984 (May 25, 2021), stating that it would interpret section 1557 and title IX’s prohibition on sex discrimination to include discrimination on the basis of sexual orientation and gender identity. The Department appealed that decision to the U.S. Court of Appeals for the Fifth Circuit and oral argument was held on January 8, 2024. The Department is not applying the challenged interpretation to members of the Neese class pending the appeal. 119 See, e.g., Whitaker By Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. Of Educ., 858 F.3d 1034 (7th Cir. 2017) (title IX); Smith v. City of Salem, Ohio, 378 F.3d 566 (6th Cir. 2004) (title VII); Rosa v. Park W. Bank & Trust Co., 214 F.3d 213 (1st Cir. 2000) (Equal Credit Opportunity Act); Schroer v. Billington, 577 F. Supp. 2d 293 (D.D.C. 2008) (title VII); Boyden v. Conlin, 341 F. Supp. 3d 979 (W.D. Wis. 2018) (section 1557 and title VII); Flack v. Wis. Dep’t. of Health Servs., 395 F. Supp 3d 1001, 1014 (W.D. Wis. 2019) (section 1557 and Equal Protection Clause); Prescott v. Rady Children’s Hosp. San Diego, 265 F. Supp. 3d 1090, 1098–100 (S.D. Cal. 2017) (section 1557); Tovar v. Essential Health, 342 F. Supp. 3d 947, 957 (D. Minn. 2018) (section 1557). See also Doe v. Snyder, 28 F.4th 103, 113–14 (9th Cir. 2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020), as amended (Aug. 28, 2020), cert. denied, 141 S. Ct. 2878 (Mem) (2020); Kadel v. Folwell, No. 1:19–cv– 00272, 2022 WL 2106270, at *28-*29 (M.D.N.C. June 10, 2022); Scott v. St. Louis Univ. Hosp., No. 4:21–cv-01270–AGF, 2022 WL 1211092, at *6 (E.D. Mo. Apr. 25, 2022); C.P. by & through Pritchard v. Blue Cross Blue Shield of Ill., No. 3:20–cv–06145– RJB, 2021 WL 1758896, at *4 (W.D. Wash. May 4, 2021); Koenke v. Saint Joseph’’s Univ., No. CV 19– 4731, 2021 WL 75778, at *2 (E.D. Pa. Jan. 8, 2021); Doe v. Univ. of Scranton, No. 3:19–cv–01486, 2020 WL 5993766, at *11 n.61 (M.D. Pa. Oct. 9, 2020); Maxon v. Seminary, No. 2:19–cv–9969, 2020 WL 6305460 (C.D. Cal. Oct. 7, 2020); B.P.J. v. W. Va. State Bd. Of Educ., No. 2:21–cv–00316, 2021 WL 3081883, at *7 (S.D.W. Va. July 21, 2021); Clark Cnty. Sch. Dist. V. Bryan, 478 P.3d 344, 354 (Nev. 2020). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations rely on E.O. 13988 for its authority, so criticisms of that order do not undermine the final rule. State of Tennessee is inapposite. There, the court held that the plaintiffs had demonstrated a reasonable likelihood of success on the claim that two other Federal agencies violated the Administrative Procedure Act by foregoing notice-and-comment procedures.120 That is not at issue here, as this is notice-and-comment rulemaking and not the issuance of informational documents. HosannaTabor involved First Amendment limitations on the application of employment discrimination laws— specifically the ‘‘ministerial exception’’ that precludes application of employment discrimination laws to ‘‘claims concerning the employment relationship between a religious institution and its ministers.’’ 565 U.S. at 188. As discussed throughout the Proposed Rule, beginning at 87 FR 47826, OCR is aware of and discusses both Franciscan Alliance v. Becerra and Christian Employers Alliance v. EEOC, and the Department is not prohibited from finalizing this rule by either decision. 87 FR 47826. Additionally, the final rule adopts new procedures for recipients wishing to invoke Federal religious freedom and conscience protections. For more on those procedures, see § 92.302. Finally, OCR disagrees with the commenters who cited Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), in support of the view that section 1557 and title IX’s prohibition on sex discrimination does not include discrimination on the basis of sexual orientation and gender identity. The legal landscape in this area has changed since that decision issued and the publication of the Proposed Rule. The Franciscan Alliance v. Burwell court concluded that the 2016 Rule’s definition of ‘‘sex’’ as including ‘‘gender identity’’ was contrary to section 1557 because ‘‘Title IX and Congress’ incorporation of it in [section 1557 of] the ACA unambiguously adopted the binary definition of sex.’’ Id. at 689. Four years later, the Supreme Court held that the prohibition on discrimination ‘‘because of . . . sex’’ under title VII covers discrimination on the basis of gender identity and sexual orientation, even assuming that ‘‘sex’’ refers ‘‘only to biological distinctions between male and female.’’ Bostock, 590 U.S. at 655. The Bostock Court held that 120 Tennessee v. U.S. Dep’t of Educ., 615 F. Supp. 3d 807 (E.D. Tenn. 2022); appeal docketed, No. 22– 5807 (6th Cir. Sept. 13, 2022) (oral argument held April 26, 2023). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 the statute’s prohibition on employment discrimination ‘‘because of sex’’ encompasses discrimination on the basis of sexual orientation and gender identity. Id. at 670–71. Comment: Several commenters generally asserted that sex is an immutable, biological binary. Some commenters relayed that their religious beliefs include that sex is an immutable binary. A commenter stated that sex has a biological component that impacts medical care. A commenter argued that if the rule does not recognize that sex is a biological binary, there will be increased confusion in the provision of medical services. Another commenter expressed concern that the rule would diminish the quality of health care received by some patients because some health conditions, such as symptoms of heart attacks, are based on ‘‘biological sex characteristics.’’ A commenter said that a prohibition of discrimination on the basis of gender identity would validate the recognition of gender identity and increase gender dysphoria. Response: OCR recognizes that sex has biological components and knowledge of an individual’s biological attributes is an essential component of providing high quality health care for all patients. For example, in the Proposed Rule, we discussed the various health disparities experienced by women, which require that providers have adequate knowledge of biology and anatomy to effectively address. 87 FR 47833–34. OCR disagrees with commenters suggesting that nondiscrimination protections on the basis of gender identity will either cause confusion in the medical profession or lead to diminished quality of care. Health care providers are highly trained in issues of biology, anatomy, and physiology. This rule requires that individuals be treated without discrimination on the basis of sex. There is no evidence that demonstrates that compliance with civil rights protections, including on the basis of sex, has caused any confusion in the medical field. On the contrary, evidence suggests that when patients are protected on the basis of sex in health care programs, quality of care improves because patients at risk of discrimination are more likely to seek and receive high quality care. For example, research shows that individuals who are experiencing gender dysphoria—defined by the American Psychiatric Association to include ‘‘clinically significant distress or impairment related to gender incongruence’’—have a clinically significant decrease in distress if they PO 00000 Frm 00055 Fmt 4701 Sfmt 4700 37575 have access to medically necessary care.121 Moreover, section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a patient or that they are not qualified to provide. With respect to commenters’ concerns about potential conflicts between the final rule and individuals’ or organizations’ sincerely held religious beliefs, we refer commenters to the discussion of this topic at § 92.302. Comment: Some commenters stated that because OCR relied on Bostock, it is bound by the definition of ‘‘sex’’ in Bostock and that definition should be included in the final rule. These commenters opined that the term ‘‘sex characteristics’’ as used by OCR is sometimes contrary to a binary understanding of the term ‘‘sex,’’ and accordingly ‘‘sex characteristics’’ either must be avoided in the regulations or used in a manner not to contradict the term ‘‘sex’’ being binary. Response: OCR has determined it is not necessary to define ‘‘sex’’ in this rule, as we have addressed a nonexhaustive list of what constitutes discrimination on the basis of sex at § 92.101(a)(2). The Supreme Court did not define the term ‘‘sex’’ in Bostock, but rather noted that nothing in their approach to the cases considered turned on the debate over whether ‘‘sex’’ was limited to ‘‘biological distinctions between male and female,’’ and the Court therefore proceeded on the assumption that ‘‘sex’’ carried that meaning. 590 U.S. at. 655. OCR declines to remove reference to ‘‘sex characteristics’’ (including intersex traits) from § 92.101(a)(2). Discrimination on the basis of sex characteristics, including intersex variations, is a prohibited form of sex discrimination because discrimination based on anatomical or physiological sex characteristics is inherently sexbased. See 87 FR 47858. Comment: Numerous commenters supported the explicit inclusion of 121 Jack Turban, M.D., M.H.S., What is Gender Dysphoria?, Am. Psychiatric Assoc., https:// www.psychiatry.org/patients-families/genderdysphoria/what-is-gender-dysphoria (Aug. 2022). E:\FR\FM\06MYR4.SGM 06MYR4 37576 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 discrimination based on sex characteristics, including intersex traits, stating that discrimination based on intersex traits is inherently sex-based. Several commenters supported this proposal, citing barriers to appropriate care and coverage resulting from discrimination suffered by intersex patients.122 These commenters cited a report in which more than half of intersex respondents reported that a provider refused to see them because of their sex characteristics or intersex variation and that almost two-thirds reported having concerns that if they disclosed their intersex status to a provider, they could be denied quality medical care.123 A few commenters recommended that § 92.101(a)(2) include concrete examples of sex discrimination, specifically on the basis of intersex traits. Response: Discrimination based on sex characteristics is a prohibited form of sex discrimination because discrimination based on anatomical or physiological sex characteristics is inherently sex-based. 87 FR 47858. It follows that discrimination on the basis of intersex traits is prohibited sex discrimination because the individual is being discriminated against based on their sex characteristics. Comment: Numerous commenters generally supported the inclusion of pregnancy or related conditions as protected bases of sex discrimination at § 92.101(a)(2) and recommended that OCR include examples of pregnancyrelated discrimination. Commenters recommended including protection for pregnancy-related conditions as a standalone provision to emphasize the importance of these protections. Commenters stated that protection against discrimination on the basis of pregnancy or related conditions would protect many patients. Commenters also pointed out that as drafted, the Proposed Rule does not consistently define sex discrimination to include pregnancy-related conditions because other sections just state ‘‘pregnancy’’ as opposed to ‘‘pregnancy or related conditions.’’ The commenters urged OCR to be consistent throughout the rule. 122 Lambda Legal & interACT Advocates, Providing Ethical and Compassionate Health Care to Intersex Patients: Intersex-Affirming Hospital Policies (2018), https://legacy.lambdalegal.org/ sites/default/files/publications/downloads/ resource_20180731_hospital-policies-intersex.pdf. 123 See Caroline Medina & Lindsay Mahowald, Ctr. for Am. Progress, Advancing Health Care Nondiscrimination Protections for LGBTQI+ Communities (2022), https:// www.americanprogress.org/article/advancinghealth-care-nondiscrimination-protections-forlgbtqi-communities. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: The inclusion of ‘‘pregnancy or related conditions’’ is consistent with the longstanding interpretation of the ‘‘ground’’ of discrimination prohibited under title IX because pregnancy-based discrimination has long been understood as a form of sex-based discrimination under title IX. For many years preceding the enactment of the ACA, the Department (along with other agencies) determined that discrimination based on pregnancy or related conditions is discrimination based on sex.124 Discrimination on the basis of pregnancy or related conditions may include, but is not limited to, instances of individuals who experience discrimination throughout pregnancy, labor and delivery, or the postpartum period. OCR agrees that the explicit inclusion of pregnancy or related conditions in the rule text is important for protecting many patients from discrimination. As discussed in the Proposed Rule, OCR considered inclusion of a provision to specifically address discrimination on the basis of ‘‘pregnancy or related conditions.’’ 87 FR 47878. We received comments stating that a separate section was not appropriate. Those comments recommended that this issue be addressed under either § 92.101 (Discrimination prohibited) or § 92.206 (Equal program access on the basis of sex). Accordingly, we maintain the inclusion of ‘‘pregnancy or related conditions’’ here under § 92.101(a)(2). For a further discussion of ‘‘pregnancy or related conditions,’’ please refer to the preamble discussion at § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status). Comment: A commenter stated that protections from pregnancy-based discrimination should include an informed consent requirement for abortion and childbirth, because the commenter asserted that consent for a Cesarean delivery is often obtained through coercion. Response: As noted in the Proposed Rule, 87 FR 47868, informed consent to any medical treatment is both a legal and ethical standard, regardless of the type of care, and serves as a basis for shared decision making.125 OCR declines to make any changes in response to this comment. Comment: Numerous commenters recommended that, in light of the Supreme Court’s decision in Dobbs v. 124 See 45 CFR 86.21(c)(2), (3); 86.40(b)(1), (4), and (5); 86.51(b)(6); 86.57(b)(d) (title IX regulation). 125 Am. Med. Ass’n, Informed Consent, https:// www.ama-assn.org/delivering-care/ethics/informedconsent. PO 00000 Frm 00056 Fmt 4701 Sfmt 4700 Jackson Women’s Health Organization, 142 S. Ct. 2228 (2022), and increased restrictions on reproductive health, OCR should provide that ‘‘pregnancy or related conditions’’ includes termination of pregnancy in the final rule. A group of commenters opined that the definition of ‘‘pregnancy or related conditions’’ should expressly exclude an abortion. Several commenters stated that OCR should clarify that this provision protects patients from discrimination on the basis of actual or perceived prior abortions. Several commenters stated that, as a result of abortion bans that have gone into effect post-Dobbs, women have been denied critical care, such as cancer treatment, because of abortion-related concerns. A commenter wrote that abortion is often necessary to save patients’ lives, especially from complications like ectopic pregnancy or premature rupture of membrane. Response: OCR appreciates commenters’ concerns and recognizes that the Supreme Court decision in Dobbs changed the legal landscape as to abortion access. While we agree that protections afforded for pregnancy or related conditions include termination of pregnancy, OCR declines to revise the language at § 92.101(a)(2) to include or exclude specific examples and will interpret section 1557’s protections on the basis of sex consistent with applicable case law addressing discrimination on the basis of sex, including pregnancy or related conditions. OCR has concluded as a matter of statutory interpretation that section 1557 does not require the Department to incorporate the language of title IX’s abortion neutrality provision, see preamble discussion at § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status). At the same time, OCR emphasizes that a covered provider’s decision not to provide abortions does not itself constitute discrimination in violation of section 1557. Also, a covered provider’s willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion also is not discrimination under section 1557. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. A covered provider that generally offered abortion care could violate that prohibition if, for example, it refused to provide an abortion to a particular patient because of that patient’s race or disability. But a covered provider does not engage in E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. It bears emphasis that nothing in the ACA, including section 1557, has ‘‘any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A). In addition, nothing in the ACA, including section 1557, preempts or has any effect on State laws regarding ‘‘the prohibition of (or requirement of) coverage, funding, or procedural requirements on abortions’’ as provided in section 1303 of the ACA, 42 U.S.C. 18023(c)(1). Against this legal landscape, OCR will evaluate specific claims of discrimination on prohibited bases on a case-by-case basis, and we decline to revise the language at § 92.101(a)(2). We note also that, as commenters suggested, this provision protects patients from discrimination on the basis of actual or perceived prior abortions. For example, a recipient’s denial of unrelated medical care that the provider generally provides to other patients to an individual based solely on the fact they had a prior abortion would constitute prohibited discrimination within the meaning of section 1557. Moreover, both the 2016 and 2020 Rules recognized that discrimination on the basis of pregnancy termination can be a form of sex discrimination. Comment: Conversely, a commenter argued that OCR should not interpret ‘‘pregnancy or related conditions’’ to include ‘‘termination of pregnancy’’ because of a concern that it will force health care providers to participate in abortions and requested that OCR provide further clarification as to what types of conduct would be prohibited discrimination under the rule. Another commenter stated the Proposed Rule wrongly treats abortion as a right protected from sex discrimination and that title IX contains an abortion neutrality provision that the rule would contravene. Response: As discussed above, a covered provider’s decision not to provide abortions does not itself constitute discrimination in violation of section 1557. A covered provider does not engage in discrimination prohibited by section 1557 if it declines to provide VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. A covered entity that chooses to provide abortion care but refuses to provide an abortion for a particular individual on the basis of a protected ground—such as race—would violate section 1557. For discussion regarding the title IX abortion neutrality provision, please see § 92.208. Comment: Several commenters requested that OCR clarify that § 92.101(a)(2) prohibits discrimination against individuals when they are seeking or accessing fertility care, maternity care, and other reproductive health care specifically. A commenter recommended that OCR clarify that pregnancy-related care applies throughout pregnancy, childbirth, and the postpartum period. Response: Section 1557 protects individuals against prohibited discrimination in all covered health programs and activities regardless of the type of care they are seeking or accessing, including fertility care, maternity care, and other reproductive health care. Similarly, section 1557 protects individuals seeking or accessing health programs and activities provided for or during preconception, pregnancy, childbirth, and postpartum recovery. Ensuring that section 1557’s protections apply throughout the continuum of care is especially critical for Black women and other people of color, who face worse health outcomes and experience higher rates of discrimination throughout pregnancy and the postpartum period.126 Comment: Many commenters raised concerns about barriers to reproductive health care faced by LGBTQI+ patients. A commenter strongly urged more explicit inclusion of ‘‘fertility’’ as a form of impermissible sex-based discrimination—so that § 92.101(a)(2)(ii) prohibits discrimination on the basis of ‘‘pregnancy, fertility, or related conditions’’—as infertility is a serious issue that impacts many LGBTQI+ populations. Commenters stated that LGBTQI+ people continue to face barriers to fertility treatment, such as in vitro fertilization (IVF), and that coverage of fertility treatments often limit or exclude LGBTQI+ patients. Response: OCR acknowledges the unique challenges faced by LGBTQI+ 126 Saraswathi Vedam et al., The Giving Voice to Mothers Study: Inequity and Mistreatment During Pregnancy and Childbirth in the United States, 16 Reprod. Health 1 (2019), https://doi.org/10.1186/ s12978-019-0729-2. PO 00000 Frm 00057 Fmt 4701 Sfmt 4700 37577 individuals seeking fertility treatment. Individuals are protected from discrimination regardless of the type of health care they seek, and we have concluded it is unnecessary to provide provisions for each specific form of health care available. Whether discrimination on the basis of sexual orientation or gender identity occurred in the provision or coverage of assistive reproductive technology—such as IVF— is necessarily fact specific. However, if a covered entity elects to provide or cover fertility services but categorically denies them to same-sex couples, it may violate section 1557’s prohibition on sex discrimination. Comment: Numerous commenters generally supported inclusion of sexual orientation as a protected basis for sex discrimination, and said that its inclusion would improve health care for LGBTQI+ individuals. Many commenters stated that LGBTQI+ individuals face discriminatory challenges to accessing health care and that the rule would alleviate these issues. Many commenters wrote that LGBTQI+ individuals often anticipate that they will experience discrimination in health care and thus often may not seek out care. Response: It is well documented that LGBTQI+ individuals face discrimination when accessing or attempting to access health care and health insurance. Section 1557 is a critical tool in combating such discrimination and addressing the resulting health disparities and other negative impacts. Comment: Numerous commenters generally supported the inclusion of discrimination on the basis of gender identity as a prohibited form of sex discrimination. Other commenters recommended including ‘‘transgender or nonbinary status,’’ ‘‘nonbinary and gender-nonconforming,’’ and ‘‘including status as transgender, nonbinary, gender nonconforming, two-spirit, or other gender.’’ Response: OCR recognizes that individuals use various terminology to describe their gender identity. For this reason, we decline to provide a definition of ‘‘gender identity’’ or ‘‘transgender status’’ in the regulation. We reiterate here that OCR will investigate discrimination against an individual based on having a gender identity that is different from their sex assigned at birth as discrimination on the basis of gender identity, regardless of whether the individual identifies with or uses the term ‘‘transgender’’ or another identity. OCR is aware that the Bostock majority uses the term ‘‘transgender E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37578 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations status’’ exclusively. But Bostock reasoned that when a person discriminates ‘‘against transgender persons, the employer unavoidably discriminates against persons with one sex identified at birth and another today’’ such that ‘‘[a]ny way you slice it, the employer intentionally refuses to hire applicants in part because of the affected individuals’ sex, even if it never learns any applicant’s sex.’’ See Bostock, 590 U.S. at 669. This therefore includes discrimination against a person because they are transgender, or because they identify in some other way that is inconsistent with their sex assigned at birth, e.g., because they are gender nonconforming. Such discrimination is also based on requiring persons to conform to stereotypical norms about sex and gender, which can also serve as the basis for impermissible sex discrimination. See, e.g., Whitaker, 858 F.3d at 1048–49 (citing Price Waterhouse, 490 U.S. at 251). Therefore, the prohibition against discrimination based on gender identity, rather than just transgender status, more fully protects individuals from prohibited sex discrimination. Indeed, the Bostock dissent stated that, as defined by the American Psychological Association, ‘‘there is no apparent difference between discrimination because of transgender status and discrimination because of gender identity.’’ 590 U.S. at 686, n.6 (Alito, J. joined by Thomas, J., dissenting). Comment: Several commenters supported OCR’s general goal at § 92.101(b) of explicitly incorporating the prohibitions on discrimination found in title VI, section 504, title IX, and the Age Act and thought this approach is prudent, given that some health care entities may not be readily familiar with the specific regulatory standards and obligations that apply to them under civil rights laws. A few commenters noted that incorporating section 504 regulations pertaining to accessibility could create conflicting obligations and specifically objected to incorporating 45 CFR 84.23(c), which applies an outdated standard (the Uniform Federal Accessibility Standards) to new facility constructions. These commenters recommended including additional language in § 92.101(b)(1)(i) that expressly states ‘‘(except for § 84.23(c)).’’ Response: We appreciate commenters’ concerns regarding inclusion of § 84.23(c). Because the rule has a separate subsection with respect to ‘‘Accessibility for buildings and facilities,’’ commenters should refer to this preamble’s discussion of § 92.203. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Comment: Some commenters requested that OCR restore the 2016 Rule clarification that any age distinctions exempt from the Age Act are also exempt from section 1557 enforcement. Response: OCR appreciates commenters’ request for clarity regarding the Age Act’s permitted age distinctions. This rule adopts by reference the Age Act implementing regulation provisions at 45 CFR part 91 (subpart B), which explicitly recognize that some age distinctions may be necessary to the normal operation of a program or activity or to the achievement of any statutory objective. See 45 CFR 91.13 (adopting statutorily permissive age distinctions found at 42 U.S.C. 6103(b)(1)). Comment: A commenter stated that OCR should exercise its authority to enforce disparate impact claims in order to address systemic discrimination in health care.127 Another commenter supported the approach taken by OCR in the Proposed Rule to not include the site location provision from the 2016 Rule, stating they believed section 1557’s context, structure, and text make evident that Congress did not intend to import multiple, piecemeal legal standards and burdens of proof derived from different statutory contexts into the doctrinal patchwork; and that section 1557 provides the full range of enforcement mechanisms and remedies available to any person pursuing a discrimination claim under section 1557, regardless of their protected characteristic. Response: After reviewing comments, OCR declines to include provisions similar to former 45 CFR 92.101(b)(3)(ii) and (iii), which are not included in the 2020 Rule. OCR will preserve the longstanding treatment of discrimination in the referenced statutes’ implementing regulations consistent with relevant case law. Summary of Regulatory Changes For the reasons set forth above and considering the comments received, we are finalizing the provision as proposed 127 Ruqaiijah Yearby et al., Structural Racism in Historical and Modern US Health Care Policy, 41 Health Affairs 187 (2022), https:// www.healthaffairs.org/doi/10.1377/ hlthaff.2021.01466; Joe Feagin & Zinobia Bennefield. Systemic Racism and U.S. Health Care, 103 Soc. Sci. & Med. 7 (2014), https://doi.org/ 10.1016/j.socscimed.2013.09.006; Cara A. Fauci, Racism and Health Care in America: Legal Responses to Racial Disparities in the Allocation of Kidneys, 21 Boston Coll. Third World J. 35 (2001); Amitabh Chandra et al., Challenges to Reducing Discrimination and Health Inequity through Existing Civil Rights Laws, 36 Health Affairs 1041 (2017), https://www.ncbi.nlm.nih.gov/pmc/articles/ PMC5654529/. PO 00000 Frm 00058 Fmt 4701 Sfmt 4700 in § 92.101, with modifications. We added ‘‘or any combination thereof’’ after disability and deleted the ‘‘or’’ before disability in § 92.101(a)(1). Subpart C—Specific Applications to Health Programs and Activities Because of section 1557’s specific application to health programs and activities, subpart C provides additional detail regarding nondiscrimination requirements in these settings. The provisions in this subpart are responsive to the nature and importance of health care, health insurance coverage, and other health-related coverage, and related health programs and activities as those health-related issues impact individuals and communities protected by section 1557’s prohibition of discrimination. These provisions are intended to provide clear instruction to covered entities and are informed by OCR’s experience in both enforcement and in providing technical assistance as well as outreach to interested parties. Meaningful Access for Individuals With Limited English Proficiency (§ 92.201) In proposed § 92.201, we proposed provisions to effectuate section 1557’s prohibition on national origin discrimination as it is applied to individuals with LEP in covered health programs and activities. In § 92.201(a), we proposed that covered entities ‘‘must take reasonable steps to provide meaningful access to each limited English proficient individual eligible to be served or likely to be directly affected by its health programs and activities.’’ In § 92.201(b), we proposed that language assistance services required under § 92.201(a) must be provided free of charge, be accurate and timely, and protect the privacy and independent decision-making ability of an individual with LEP. In § 92.201(c), we proposed specific requirements for interpreter and translation services. Section 92.201(c)(1) proposed that when interpreter services are required under this part, a covered entity must offer a qualified interpreter. Section 92.201(c)(2) proposed that when translation services are required under this part, a covered entity must use a qualified translator. In § 92.201(c)(3), we proposed regulatory language requiring a covered entity that uses machine translation to have translated materials reviewed by a qualified human translator when the underlying text is critical to the rights, benefits, or meaningful access of an individual with LEP; when accuracy is essential; or when the source documents or materials contain complex, nonliteral, or technical language. We sought E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations comment on the use of machine translation in health programs and activities generally, other possible approaches to address this issue, and whether there should be an exception to this provision to allow for the limited use of machine translation in exigent circumstances. In § 92.201(d), we addressed how the Director will evaluate compliance with this section. In § 92.201(d)(1), we proposed that the Director shall evaluate, and give substantial weight to, the nature and importance of the health program or activity and the particular communication at issue, to the individual with LEP. Proposed § 92.201(d)(2) provides that the Director shall take into account other relevant factors, including the effectiveness of the covered entity’s written language access procedures for its health programs and activities, that the covered entity has implemented pursuant to proposed § 92.8(d). In § 92.201(e), we proposed restrictions on the use of certain persons to provide language assistance services for individuals with LEP. In § 92.201(e)(1), we proposed prohibitions on covered entities from requiring individuals with LEP to provide, or pay for, their own interpreters. Proposed § 92.201(e)(2) provided for very limited situations in which an adult, not qualified as an interpreter, accompanying an individual with LEP can serve as an interpreter. Section 92.201(e)(3) proposed to prohibit a covered entity from relying on a minor child to interpret or facilitate communication, except as a temporary measure while finding a qualified interpreter in an emergency involving an imminent threat to the safety or welfare of an individual or the public where there is no qualified interpreter for the individual with LEP immediately available. In § 92.201(e)(4), we proposed prohibiting reliance on staff other than qualified interpreters, qualified translators, or qualified bilingual or multilingual staff to communicate directly with individuals with LEP. In § 92.201(f), we proposed standards for video remote interpreting (VRI). In § 92.201(g), we proposed standards for audio remote interpreting services. In § 92.201(h), we proposed that nothing in this section shall be construed to require an individual with LEP to accept language assistance services. The comments and our responses regarding § 92.201 are set forth below. Comment: Many commenters were very supportive of § 92.201(a)’s requirement that covered entities must take reasonable steps to provide VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 meaningful access to ‘‘each’’ individual with LEP eligible to be served or likely to be directly affected by its health programs and activities. Commenters also supported OCR’s revision concerning individuals with LEP ‘‘likely to be directly affected’’ by a health program or service, as opposed to the previous ‘‘likely to be encountered,’’ as it provides greater clarity about the applicability of this rule and reduces some burden on health care practices. Commenters maintained that this standard provides a better description for providers to understand. Other commenters supported inclusion of ‘‘eligible to be served or likely to be directly affected’’ because they believe it expands the definition of who can receive language access and better reflects how language service needs are experienced by people seeking health care. Many commenters recommended that OCR clarify that companions are expressly included, noting that this is especially important for caretakers of minor children or those accompanying older adults. Response: OCR appreciates commenters’ thoughts on the language at § 92.201(a) and confirms that covered entities’ language access obligations also apply to companions (defined in § 92.4), as companions are ‘‘directly affected by [a covered entity’s] health programs and activities’’ by virtue of their relationship with the person whom they are accompanying. For example, a covered entity will need to take reasonable steps to provide meaningful access to a parent with LEP whose minor child is being treated or an individual with LEP who may be assisting their spouse with postoperative care. To reinforce this requirement, OCR is adding a parenthetical to the text of § 92.201(a) to clarify that individuals with LEP who are covered under this part include companions with LEP. This language is consistent with the requirement to provide effective communication for companions with disabilities under § 92.202. Comment: Various commenters appreciated OCR providing clarity on the terms ‘‘reasonable steps’’ and ‘‘meaningful access,’’ noting that the 2020 Rule’s deletion of meaningful access requirements was detrimental to the health of communities with LEP. A few commenters recommended that clearer directives should be included as to what types of services constitute ‘‘reasonable steps,’’ suggesting this could be clarified by providing examples of ‘‘reasonable steps,’’ or by adding definitions of ‘‘reasonable steps’’ and ‘‘meaningful access’’ to § 92.4 (Definitions). Another commenter PO 00000 Frm 00059 Fmt 4701 Sfmt 4700 37579 cautioned that the lack of clarity could result in covered entities coming to the determination that no services are required of them. Others stated that additional guidance is needed specifically for providers and payers. Response: OCR appreciates the request for additional definitions; however, we decline to provide a definition for ‘‘reasonable steps’’ or ‘‘meaningful access,’’ as these terms are not unique to section 1557 and reflect longstanding requirements under title VI. OCR will consider developing additional guidance on this topic but also refers commenters to the Department’s longstanding HHS LEP Guidance, 67 FR 47311, as well as the Department’s 2023 Language Access Annual Progress Report. The 2023 Progress Report describes the Department’s reconstituted Language Access Steering Committee based on the HHS Equity Action Plan issued under E.O. 13985, clarifies benchmarks for meaningful language access in key areas such as developing best practices for oral interpretation and internet-based access to written translation, and sets forth current plans to update the Department’s Language Access Plans and issue related guidance.128 Comment: A number of commenters stated that failure to provide meaningful access may violate both section 1557’s national origin prohibition and the prohibition on race discrimination. Several commenters stated that there are instances in which an individual experiences discrimination based on their limited English proficiency, in addition to another protected characteristic. For example, a person who is Black and has limited English proficiency is more likely to experience discrimination in health care settings than an individual who is Black but does not have limited English proficiency or an individual with limited English proficiency but who is not Black.129 Commenters stated that this type of discrimination may deter patients from seeking critical health care services, leading to adverse health outcomes and decreased trust in the health care system.130 Commenters also 128 U.S. Health & Hum. Servs., Off. for Civil Rts., 2023 Language Access Annual Progress Report (2023), https://www.hhs.gov/sites/default/files/ language-access-report-2023.pdf. 129 Neelam H. Ahmed et al., Moderation of the Association Between Primary Language and Health by Race and Gender: An Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 (2022), https://www.mdpi.com/1660-4601/19/13/7750. 130 Neelam H. Ahmed et al., Moderation of the Association between Primary Language and Health by Race and Gender: An Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 (2022), E:\FR\FM\06MYR4.SGM Continued 06MYR4 37580 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 provided data showing that almost one in four health center patients communicate in a language other than English;131 63 percent of individuals with LEP identify as Hispanic/Latino;132 language barriers have been proven to contribute to health inequities for Asian American, Native Hawaiian, and Pacific Islander individuals in particular;133 and people with LEP are less likely to receive primary care and preventive care, such as breast and cervical cancer screenings.134 Some commenters also specifically addressed the importance of language assistance services for older individuals with LEP. These commenters submitted research demonstrating that it is especially difficult for older adults with LEP to communicate with providers because of limited English proficiency, low health literacy, and lack of translators and interpreters.135 Many https://www.mdpi.com/1660-4601/19/13/7750: Francisco Ramos-Gomez et al., Addressing Social Determinants of Oral Health, Structural Racism and Discrimination and Intersectionality among Immigrant and Non-English Speaking Hispanics in the United States, 82 J. Pub. Health Dentistry 133 (2022), https://doi.org/10.1111/jphd.12524. 131 Kathryn Pitkin Derose et al., Limited English Proficiency and Latinos’ Use of Physician Servs., 57 Med. Care Rsch. Rev. 76 (2000), https://doi.org/ 10.1177/107755870005700105. 132 Jie Zong & Jeanne Batalova, Migration Pol’y Inst., The Limited English Proficient Population in the United States in 2013 (2015), https:// www.migrationpolicy.org/article/limited-englishproficient-population-united-states-2013. 133 Gilbert C. Gee et al., Associations Between Racial Discrimination, Limited English Proficiency, and Health-Related Quality of Life Among 6 Asian Ethnic Groups in California, 100 Am. J. of Pub. Health 891 (2010), https://www.ncbi.nlm.nih.gov/ pmc/articles/PMC2853608/. 134 Elizabeth A. Jacobs et al., Limited English Proficiency and Breast and Cervical Cancer Screening in a Multiethnic Population, 95 Am. J. Pub. Health, 1410 (2005), https:// www.ncbi.nlm.nih.gov/pmc/articles/PMC1449374/; Israel De Alba et al., English Proficiency and Physicians’ Recommendation of Pap Smears Among Hispanics, 30 Cancer Detection & Prevention 292 (2006), https:// pubmed.ncbi.nlm.nih.gov/16844320/; Lisa Diamond et al., A Systematic Review of the Impact of Patient– Physician Non-English Language Concordance on Quality of Care and Outcomes, 34(8) J. Gen. Internal Med. 1591 (2019), https://www.ncbi.nlm.nih.gov/ pmc/articles/PMC6667611/; Kelly H. Bruce et al., Barriers and Facilitators to Prevent Cancer Screening in Limited English Proficient (LEP) Patients: Physicians’ Perspectives, 11 Commc’ns. Med. 235 (2014), https://journal.equinoxpub.com/ CAM/article/view/8592. 135 U.S. Dep’t of Health & Hum. Servs., Ctr. for Disease Control, Adults with Disabilities: Ethnicity and Race, https://www.cdc.gov/ncbddd/ disabilityandhealth/materials/infographicdisabilities-ethnicity-race.html (citing Elizabeth A. Courtney-Long et al., Socioeconomic Factors at the Intersection of Race and Ethnicity Influencing Health Risks for People with Disabilities, 4 J. Racial and Ethnic Health Disparities 213 (2017), https:// pubmed.ncbi.nlm.nih.gov/27059052/); Francisco J. Medrano et al., Limited English Proficiency in Older Adults Referred to the Cardiovascular Team, 136 Am. J. of Med. 466 (2023); Terceira A. Berdahl et VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 commenters argued that to ensure access to quality care, covered entities must have translators and interpreters available at all points of contact at no cost to an individual. This is because older adults may be less inclined to ask for language assistance or may rely on family members who are not qualified to interpret health information. Additionally, the commenters noted that language assistance services are critical for people at the end of life who, absent these services, cannot give true informed consent or thoroughly understand their end-of-life care options. Response: OCR appreciates these comments and the data submitted. As discussed elsewhere in this preamble, section 1557’s language access requirements derive from the statute’s prohibition on discrimination against national origin. OCR also appreciates, and agrees with, comments highlighting the ways in which individuals may experience discrimination on multiple grounds as well as comments about the importance of language assistance services for older individuals with LEP. The provisions for § 92.201(a) enhance health access and reduce discrimination by requiring covered entities to take reasonable steps to provide meaningful access to each individual with LEP. Comment: Many commenters stated that language assistance has often been costly to the individuals with LEP, and translations have often been inaccurate, incomplete, or both. Commenters additionally noted that language assistance has often been provided later in time than other services and that interpretation has not been done in a way that protects patient privacy. Other commenters submitted examples of individuals with LEP being provided with incomplete information, such as being told of only one treatment option, rather than be told of other available treatment options. Response: We appreciate concerns raised regarding cost, timeliness, and privacy concerns, which we address in § 92.201(b). Consistent with language access requirements in the 2016 and 2020 Rules, required language assistance services must be provided free of charge, be accurate and timely, and protect the privacy of the individual with LEP. Inaccurate or incomplete translations or interpretation may violate the accuracy standard found in this provision and the overarching requirement to take reasonable steps to al., Patient-Provider Communication Disparities by Limited English Proficiency (LEP): Trends from the US Medical Expenditure Panel Survey, 2006–2015, 34 J. Gen. Internal Med. 1434 (2019), https:// www.ncbi.nlm.nih.gov/pmc/articles/PMC6667581/. PO 00000 Frm 00060 Fmt 4701 Sfmt 4700 provide meaningful access. Accuracy issues are further addressed by requiring covered entities to use the services of qualified interpreters and translators, at § 92.201(c). Comment: Commenters noted a lack of definition for timeliness in § 92.201(b), and one recommended OCR establish time, distance, and wait time standards. Another commenter suggested that the timeliness standard take into account the geographic location of the covered entity and the hour of the day when the need for language assistance services arises. Response: As OCR discusses in the HHS LEP Guidance, timeliness may depend on multiple variables and so no one definition would be reasonable or applicable to ‘‘all types of interactions at all times by all types of recipients.’’ 68 FR 47316. However, language assistance should be provided at a time and place that avoids the effective denial of the service, benefit, or right at issue or the imposition of an undue burden on or delay in important rights, benefits, or services to the person with LEP. 68 FR 47316. When evaluating a complaint, OCR will consider the context, including the urgency and importance of many health care services. We encourage covered entities to review the HHS LEP Guidance for additional guidance. Comment: Several commenters stated that language assistance services should be required to include cultural competency and that providers should reflect the community around them in order to build trust. One commenter noted that during listening sessions they conducted, participating health centers emphasized the important role that bilingual and bicultural staff who represent the community served to provide accurate and culturally comprehensible interpretation. A few commenters recommended requiring covered entities to ensure sufficient staff with appropriate training and to administer language proficiency assessments to confirm competency of bilingual and multilingual staff. Some commenters urged that translators and interpreters be from or a part of the impacted community in which they serve, with some suggesting that community-based interpreters and translators may be more qualified for a number of reasons, including familiarity with local dialect and cultural competency. Others, however, stated that family members and community service providers or other external groups should not have to bear the burden of interpreting. Response: OCR generally agrees that cultural competency is essential for E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 equitable language access and communications.136 This is especially important considering variations in dialects, expressions, or ‘‘regionalisms.’’ For example, a Spanish word that may be understood to mean something for someone from Puerto Rico may mean something else for someone from Mexico. Thus, cultural competency is a key factor in providing accurate interpretation and translation, and accuracy is a necessary component of meaningful access. OCR recognizes that community members may be more likely to be culturally competent but declines to include in the regulatory text a requirement that translators and interpreters be from the community they serve. Covered entities are free to determine their own hiring and contracting processes for utilizing the services of qualified interpreters and translators, and hiring bilingual/ multilingual staff, as long as these individuals meet the requirements for their respective positions as provided in § 92.4 (Definitions). Comment: Many commenters supported the novel proposal to address machine translation in this regulation, with some requesting that machine translation always be checked by a qualified human translator and that patients be advised when a translation has been completed by machine translation due to high error rates. One commenter specified that covered entities should not use Google Translate as the only resource for translations as it generates errors, pointing to a State Department of Health website translating ‘‘the vaccine is not required’’ for COVID–19 to ‘‘the vaccine is not necessary’’ in Spanish (since corrected). Other commenters stated that the rule does not adequately account for future innovations and that the final rule should include an exception for exigent circumstances. Insurance entities and other providers commented that machine translation is a viable option to reduce costs in some instances. 136 See U.S. Dep’t of Health & Hum. Servs., Off. of Minority Health, Think Cultural Health, National Standards for Culturally and Linguistically Appropriate Services (CLAS) in Health and Health Care, https://thinkculturalhealth.hhs.gov/assets/ pdfs/EnhancedNationalCLASStandards.pdf (recommending that health organizations: ‘‘[p]rovide effective, equitable, understandable, and respectful quality care and services that are responsive to diverse cultural health beliefs and practices, preferred languages, health literacy, and other communication needs,’’ through providing language assistance and ‘‘[e]stablish[ing] culturally and linguistically appropriate goals, policies, and management accountability, and infuse them throughout the organization’s planning and operations’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: OCR recognizes that machine translation is an evolving technology. However, given that it still carries significant potential for error, we believe this provision strikes an appropriate balance between the convenience some may find in this technology and the critical nature of communications in the health care context. We appreciate commenters’ concerns regarding exigent circumstances, where use of machine translation technology may provide immediate language assistance capabilities in very urgent circumstances. As provided under § 92.201(a), ‘‘[a] covered entity must take reasonable steps to provide meaningful access to each individual with limited English proficiency (including companions with limited English proficiency) eligible to be served or likely to be directly affected by its health programs and activities.’’ For example, if an emergency medical technician must provide urgent medical care to an individual with LEP, and no other language assistance services are available, it may be reasonable to use machine translation technology to communicate with that person while a qualified interpreter is identified. We note that the definition for machine translation found at § 92.4 under this final rule ‘‘means automated translation . . . that is text based and provides instant translations between various languages,’’ which includes automated translation covers speech as well as written communications. However, given the importance of communication and understanding in the health care and services setting, OCR requires that in such circumstances, the machine translation must be subsequently checked by a qualified human translator as soon as practicable. OCR also recommends that, if machine translation is used in circumstances that do not require human review (i.e., those circumstances that do not meet the criteria set forth in § 92.201(c)(3)), the patients should be warned that it may contain errors. OCR directs commenters to § 92.4 (Definitions) for further discussion on machine translation and future technology. Comment: OCR received limited comments on our proposed revisions to the factors the Director will take into account when evaluating compliance with language access obligations (proposed § 92.201(d)). Several commenters supported discontinuing the 2020 Rule’s use of the ‘‘four-factor analysis,’’ 45 CFR 92.101(b)(1), found in the HHS LEP Guidance, 68 FR 47314– 16, to determine compliance with a PO 00000 Frm 00061 Fmt 4701 Sfmt 4700 37581 covered entity’s language access requirements under section 1557. These commenters stated that the four-factor analysis is too vague to be useful for oversight of compliance and does not provide direction on how each of the factors would be weighed against each other. Conversely, a few commenters recommended that OCR retain the fourfactor analysis since it provides covered entities more flexibility. These commenters noted that recipients must have flexibility in achieving compliance with requirements for language access because of their limited resources and patient populations. A few commenters noted that the phrase ‘‘other relevant factors’’ in § 92.201(d) is vague and should either be removed or clarified. Specifically, they said that compliance has been an ongoing problem and more information is needed to help covered entities understand the factors that will be used for evaluation of compliance. Additionally, one commenter recommended that the final rule include the geographic location of the covered entity and the hour of the day when the need for language assistance services arises as one of the factors for OCR to consider in evaluating compliance. For example, the ability of a small, rural provider to find an interpreter for an individual with LEP at midnight on a Saturday is going to be substantially more challenging than it would be for a provider in an urban setting. Response: As discussed in the 2022 NPRM, 87 FR 47862, after additional consideration OCR determined that the four-factor test was not a sufficiently precise or flexible compliance tool. Section 92.201(d)(1) provides flexibility that allows the Director to take into account a range of relevant factors, including the ‘‘nature and importance of the health program or activity and the particular communication at issue, to the individual with limited English proficiency.’’ Additionally, § 92.201(d)(2) allows for the consideration of ‘‘other relevant factors,’’ including those that relate to whether ‘‘reasonable steps’’ were taken in a given situation. Thus, the Director may take into account the geographic location and timing considerations posed by the commenter’s example in evaluating whether ‘‘reasonable steps’’ were taken. Comment: Many commenters supported the inclusion of an explicit prohibition on the use of certain persons to interpret or facilitate communication, including the expectation that in an emergency situation, reliance on an accompanying adult or minor should be ‘‘a temporary measure’’ at § 92.201(e). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37582 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Commenters stated that children oftentimes are asked to interpret medical information for which they do not have the vocabulary or content knowledge. Some also stated that older adults with LEP may feel pressure to rely on family members as interpreters, even if those family members are not qualified to interpret health information, which can inhibit the older adult’s understanding of their health status and instructions from their provider. Response: We appreciate the commenters’ support and underscore that untrained ‘‘interpreters’’ are more likely to make errors, violate confidentiality, and increase the risk of poor outcomes. Research has shown that the ability of a provider to accurately diagnose a patient’s condition can be jeopardized by untrained interpreters, such as family and friends, and especially minor children who are prone to omissions, additions, substitutions, volunteered opinions, semantic errors, and other problematic practices.137 Additionally, the use of children as interpreters raises not only the same concerns as those of an accompanying adult who is not qualified as an interpreter, but also poses other problems including exposing children to complex health care interactions for which they are not developmentally prepared, upsetting a family power dynamic, causing embarrassment, and conveying incorrect or incomplete information. 87 FR 47863. Comment: Some commenters requested that OCR provide emergency exceptions for using bilingual/ multilingual staff as interpreters. These commenters noted that covered entities should be able to use their staff’s skills in different languages when needed in emergency situations. Response: We appreciate commenters’ concerns regarding obtaining the services of a qualified interpreter in emergency situations. Under § 92.201(e)(2) introductory text, a covered entity may ‘‘[r]ely on an adult, not qualified as an interpreter, accompanying a limited English proficient individual to interpret or facilitate communication’’ as a temporary measure in an emergency pending the retention of a qualified interpreter. OCR has revised § 92.201(e)(2) introductory text to remove references limiting reliance on a 137 Joseph R. Betancourt et al., The Disparities Solutions Ctr., Mongan Inst. for Health Pol’y, Mass. Gen. Hosp., Improving Patient Safety Systems for Patients with Limited English Proficiency: A Guide for Hospitals, pp. 3–5, 10–11, 14–16 (2012), https:// www.ahrq.gov/sites/default/files/publications/files/ lepguide.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 non-qualified interpreter to only an adult ‘‘accompanying an individual with LEP.’’ This provision now allows for a covered entity to rely on a bilingual/multilingual staff member—or other adult not accompanying an individual with LEP—to serve as an interpreter as a temporary measure in such emergency situations. Furthermore, the interpreter services of bilingual/multilingual staff who are also qualified interpreters may be utilized in any situation, including emergency situations. However, covered entities should consider how to obtain the services of a qualified interpreter as quickly as possible in emergency and exigent circumstances, and only rely upon other persons in highly exceptional circumstances. Comment: A couple of commenters recommended that OCR revise § 92.201(e)(2)(ii) to allow a covered entity to use a qualified interpreter even in situations where the patient has requested that a family member or friend interpret or facilitate communication. These commenters explained that if a provider believes that the family member or friend may not be accurately communicating with the patient or appears to be struggling when interpreting or if a health provider suspects in good faith that an individual may be a victim of trafficking or abuse, then the health provider should be able to utilize a qualified interpreter. Another commenter recommended that OCR clarify that an accompanying adult may only facilitate communication at the request of an individual with LEP when the request is made in private, without the adult present. The commenter expressed concern that the exception as written could interfere with the autonomy of the individual with LEP seeking sexual or reproductive health services, especially if the individual is accompanied by an abusive partner that objects to certain sexual and reproductive health services. Additionally, one commenter noted that the prohibition of an accompanying adult acting as an interpreter—absent the individual with LEP’s consent or in the case of an emergency—is particularly important for survivors of domestic and sexual violence. The commenter stated that without such a restriction, victims and survivors are faced with situations where their abuser, child, or family member may be used to interpret traumatic and sensitive information, compounding the risk to victims and trauma to themselves as well as their children. Another commenter recommended OCR specify that if an individual with LEP requests an accompanying adult to facilitate one PO 00000 Frm 00062 Fmt 4701 Sfmt 4700 time, this does not mean the covered entity can assume the individual with LEP will continue to bring that same adult or choose to use that adult as an interpreter for future interactions. The covered entity must offer language services each and every time it encounters an individual with LEP. One commenter requested OCR also address nonemergency situations where the patient does not ‘‘specifically request’’ that an accompanying adult interpret or facilitate communication, but where, despite best efforts to find a qualified interpreter, it is not possible to find a qualified interpreter for the individual with LEP, such as when a patient speaks a rare dialect of a language. Response: We appreciate the commenters’ concerns regarding when it may or may not be appropriate to grant an adult with LEP’s request for an individual not qualified as an interpreter to interpret or facilitate communication. When considering reliance on an accompanying adult to interpret, the covered entity must consider whether that reliance is appropriate—this includes whether the covered entity believes the accompanying adult can adequately convey the information being discussed and whether they may have a conflict or bias, as in the case of intimate partner violence. Any agreement by a covered entity to allow an accompanying adult to interpret or facilitate communication may only be at the affirmative and independent request of the individual with LEP so as to protect individuals in situations such as intimate partner violence, abuse, or trafficking. We clarify that OCR appreciates the critical role parents and guardians play in medical decision-making for their children and that the rule does not prevent parents from being involved in their children’s health care decisions. To address the concern of coercion and the like, we are finalizing § 92.201(e)(2)(ii) to include a requirement that the individual with LEP make their request without the accompanying adult present and with the services of a qualified interpreter, which does not include the exigent circumstances exception found at § 92.201(e)(2)(i). Comment: One commenter encouraged OCR to include a specific provision at § 92.201(e) ensuring privacy and confidentiality for individuals with LEP, such as not having sensitive discussions in waiting rooms and other public spaces. Response: We appreciate the commenter’s concern regarding privacy and confidentiality for individuals with E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 LEP and restate that one of the key components of the definition of ‘‘qualified interpreter for an individual with limited English proficiency’’ is that they must adhere to generally accepted interpreter ethics principles, including client confidentiality. Additionally, covered entities that are subject to both HIPAA and section 1557 must comply with the requirements of both laws.138 Comment: Several commenters supported the restoration of requirements related to video remote interpreting (VRI) for individuals with LEP. Commenters noted that the 2020 Rule removed requirements related to VRI for individuals with LEP, yet many covered entities use video interpreting not only for deaf or hard of hearing patients but also patients with LEP. Further, these commenters noted that the quality of video interpreting should be the same for all individuals who use it. A couple of commenters specifically noted the importance of high-quality picture, video, and transmissible audio for all parties in order for interpreters to perform their job effectively. For example, one commenter noted the importance of restoring VRI standards for individuals with LEP given frequent concerns about the poor quality of interpreter services using VRI. A couple of other commenters mentioned that the use of such technology will facilitate discussion between qualified interpreters and individuals with LEP and will also assist individuals who may have disabilities who are aided by using such technology. One commenter, who supported inclusion of VRI standards, recommended in-person interpretation should be sought as a first step because it is more responsive than VRI. Response: We agree with commenters that it is important to have parity in VRI quality standards for all individuals who use it. The final rule reinstates the VRI standards from the 2016 Rule, former 45 CFR 92.201(f), which were based on standards found in the implementing regulations for title II of the ADA.139 This provision is designed 138 Determining the relationship between the interpreter and the covered entity is a covered entity’s HIPAA obligation and is unchanged by section 1557 or the part. We encourage covered entities to review OCR’s HIPAA Frequently Asked Questions (FAQ) regarding business associates. See U.S. Health & Hum. Servs., Off. for Civil Rts., Health Information Privacy FAQs, https:// www.hhs.gov/hipaa/for-professionals/faq/760/ must-a-covered-provider-obtain-individualauthorization-to-disclose-to-an-interpreter/ index.html. 139 See 28 CFR 35.160(d)(1)–(4). In contrast to 28 CFR 35.160(d)(2), which regulates the size of the video image to ensure that the screen shows one’s face, arms, hands, and fingers, § 92.201(f)(2) in this final rule does not regulate the size of the video VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 to achieve parity with the VRI requirements found in § 92.202 regarding effective communication for people with disabilities. We recognize that VRI is not always the most appropriate method for providing language assistance services. This provision does not require a covered entity to provide VRI but rather ensures that when such services are used, they meet a minimum quality standard. To also clarify that the language assistance services delivered via VRI must provide meaningful access, we are revising § 92.201(f) to require that when a covered entity uses VRI services, it ‘‘must ensure the modality allows for meaningful access.’’ Comment: A few commenters raised concerns with the proposed technical requirements for VRI services. A couple of commenters requested OCR provide emergency exceptions for performance standards for video remote interpreting. These commenters also expressed concern with the requirement that VRI must be over a dedicated high-speed, wide-bandwidth video connection or wireless connection since it may be difficult to meet that standard in an emergency, such as a natural disaster that disrupts access to the high-speed connection. Another commenter suggested revising the rule to require covered entities to use audio and video communications for interpretation services that are consistent with those available in the community served by the health program or activity. The commenter explained the communications framework in a community, such as a rural community, may not fully meet the standards proposed. Response: We appreciate commenters’ concerns regarding the ability to meet the VRI standards proposed. In the event of a natural disaster or locations where high-speed wide-bandwidth video capabilities may not be available, covered entities may not be able to meet the required standards. In these circumstances, a reasonable step to achieving meaningful access may be through using the services of a qualified interpreter via telephone (or in-person, if available). As in all circumstances, OCR will consider the specific facts of whether a covered entity has taken reasonable steps to provide meaningful access under the circumstances. Comment: A couple of commenters recommended that VRI requirements be image because this component is less relevant for oral interpretation between English and nonEnglish languages or two non-English spoken languages. PO 00000 Frm 00063 Fmt 4701 Sfmt 4700 37583 reflective of and adaptable to the specific community or individual. One organizational commenter recommended that the rule clarify that covered entities should follow an individual’s preference with respect to interpreter services where appropriate. The commenter noted that the majority of their members and patients with LEP communicate through telephonic interpretation services and that there are also situations where a member or patient may express a preference to use an audio interpreter service rather than be required to participate in a video session. Response: We appreciate commenters’ suggestions regarding prioritizing an individual with LEP’s preference when determining the manner in which interpreting services will be provided. However, we decline to revise the requirements for VRI standards. These standards set minimum requirements for when language assistance services are provided via VRI; they do not, however, require a covered entity to use such technology. Covered entities are free to use audio-only interpretation if that is a reasonable step to provide meaningful access to an individual with LEP, including if it is the expressed preference of an individual with LEP. Comment: A few commenters recommended OCR establish further requirements with respect to VRI. These commenters suggested OCR specify that the covered entity should be held responsible for ensuring that the VRI device connects to a qualified interpreter within five minutes of the arrival of the VRI device in the room and ensure that there are no interruptions in communication, such as disconnections or screensavers. Further, commenters recommended that health care entities should have personnel available on a 24-hour basis who are trained and able to operate the VRI system efficiently. These commenters stressed that hospitals are already responsible for the maintenance and upkeep of multiple types of equipment necessary for health care and, as such, the same strict standards for optimal operation and upkeep should apply to VRI technology as well. A few commenters stated that covered entities should have policies and procedures in place to procure video remote interpretation. Response: OCR appreciates the commenters’ recommendations for providing further requirements related to VRI. The rule requires that language assistance services be provided in a timely manner. We decline to mandate a specific time period in which an interpreter must be made available once E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37584 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations a VRI device is present, as it does not allow for the necessary flexibility that may be required to account for the specific circumstances giving rise to the interaction, such as whether it is scheduled or unscheduled. We agree it is important to ensure a covered entity has personnel who can maintain and efficiently set up and operate VRI technology. To this end, the rule requires covered entities to maintain language access procedures per § 92.8(d), and to provide adequate training to users of the technology and other involved persons so that they may quickly and efficiently set up and operate the VRI device per § 92.201(f)(4). Although we support covered entities having policies and procedures in place related to the procurement of video remote interpretation, we decline to require them to do so because we do not believe imposing such a requirement is warranted at this time. Comment: OCR received a few comments on the standards for audio remote interpreting services at § 92.201(g), which were generally supportive. One commenter expressed that audio-only interpretation is often a poor substitute for video remote or inperson interpretation and recommended OCR consider audio-only interpretation to be a last resort. Response: We appreciate the commenter’s concern and recognize that audio remote interpreting may not be adequate to provide meaningful access to an individual with LEP. However, there are situations in which audio remote interpreting may be the only option available to a covered entity and so we decline to place further restrictions on its use. To address concerns that audio remote interpreting may fail to provide meaningful access, we are revising § 92.201(g) to require that when a covered entity uses audio remote interpreting services, it ‘‘must ensure the modality allows for meaningful access.’’ Comment: One commenter recommended OCR explicitly prohibit covered entities from coercing individuals with LEP to decline language assistance services, which was stated in the preamble to the 2015 NPRM. 80 FR 54185. The commenter noted that the 2022 NPRM did not capture this important concept and covered entities should be prohibited from discouraging individuals with LEP from exercising their rights, which may be a form of discrimination. Response: We appreciate the commenter’s concern and reiterate that a covered entity may not coerce an individual with LEP to decline language VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 assistance services. In the same way that a covered entity is prohibited from requiring an individual with LEP to accept language assistance services, § 92.201(h), a covered entity similarly cannot require or coerce an individual to decline such services. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the provisions as proposed in § 92.201, with modifications. In § 92.201(a), we are adding ‘‘(including companions with limited English proficiency)’’ after the term ‘‘individual with limited English proficiency.’’ In § 92.201(e)(2), we are deleting the clause ‘‘accompanying a limited English proficient individual.’’ In § 92.201(e)(2)(i), we are replacing ‘‘the accompanying adult’’ with ‘‘an initial adult interpreter.’’ In § 92.201(e)(2)(ii) we are adding the phrase ‘‘in private with a qualified interpreter present and without an accompanying adult present,’’ after ‘‘where the individual with limited English proficiency specifically requests.’’ In § 92.201(f), we are adding the phrase ‘‘ensure the modality allows for meaningful access and must . . .’’ after ‘‘through video remote interpreting services in the covered entity’s health programs and activities must . . .’’ In § 92.201(g), we are adding the phrase ‘‘ensure the modality allows for meaningful access and must . . .’’ after ‘‘through audio remote interpreting services in the covered entity’s health programs and activities must . . .’’ We are also making technical revisions. Throughout § 92.201, we are replacing the term ‘‘limited English proficient individual’’ with ‘‘individual with limited English proficiency.’’ In § 92.201(c)(2), we are replacing the phrase ‘‘a covered entity must use a qualified translator’’ with ‘‘a covered entity must utilize the services of a qualified translator.’’ In § 92.201(e)(2)(ii), we are replacing the word ‘‘the’’ in the phrase ‘‘by the accompanying adult is documented’’ with ‘‘by an accompanying adult is documented.’’ In § 92.201(e)(4) we are striking the word ‘‘directly’’ as technically incorrect to describe the manner in which a covered entity communicates to an individual with LEP via the services of a qualified interpreter or qualified translator. Effective Communication for Individuals With Disabilities (§ 92.202) Proposed § 92.202 addressed requirements related to providing PO 00000 Frm 00064 Fmt 4701 Sfmt 4700 effective communication for individuals with disabilities. In § 92.202(a), we proposed requiring a covered entity to take appropriate steps to ensure that communications with individuals with disabilities, and companions with disabilities, are as effective as communications with individuals without disabilities in its health programs and activities, incorporating the standards found at 28 CFR 35.130 and 35.160 through 35.164 of the regulation implementing title II of the ADA. In § 92.202(b), we proposed to require covered entities to provide appropriate auxiliary aids and services to individuals with impaired sensory, manual, or speaking skills, where necessary to afford such individuals an equal opportunity to benefit from the service in question. The comments and our responses regarding § 92.202 are set forth below. Comment: While commenters generally expressed support for § 92.202, many discussed the extensive lack of compliance with current effective communication requirements under section 1557, section 504, and title II of the ADA by covered entities. Some referenced costs as the key issue, and one commenter stated that some providers have a policy of only providing an interpreter if the cost is covered by the patient’s health insurance. Another commenter stated that even when the State has a Medicaid billing code, the patients still are faced with the burden of having to educate prospective providers about the availability of the code and the provider’s obligation to provide auxiliary aids and services. Other commenters mentioned that compliance will require implementing programs to develop, maintain, and communicate clear policies, and train on the provision of language assistance services and auxiliary aids and services for effective communication. Response: OCR is aware that some covered entities fail to comply with their responsibility to ensure effective communication with individuals with disabilities, including through requiring an individual to bring their own interpreter, only providing interpreter services when covered by the individual’s health insurance coverage or other health-related coverage, or incorrectly citing health privacy laws as a reason to not provide interpreter services. In an effort to proactively address compliance concerns and resulting lack of access to covered health programs and activities, we are requiring all covered entities to develop and E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations maintain effective communication procedures, per § 92.8(e). OCR encourages covered entities to include any necessary billing codes in such procedures. We are further requiring covered entities to train relevant employees on these procedures, per § 92.9. Comment: A patient advocacy group recommended requiring that states establish a medical communication access fund that pools fees from Statemandated medical licenses to pay for effective communication. The commenter expressed that this method spreads out the costs of auxiliary aids and services so that no single covered entity bears the costs. Response: All covered entities must provide auxiliary aids and services when needed to communicate effectively with people with disabilities. OCR encourages covered entities to develop creative approaches to support the provision of these required aids and services. OCR declines to include a specific requirement for states to establish mandatory medical communication access funds in this rulemaking as such a requirement would exceed the authority granted to OCR for this rulemaking. Comment: Some commenters expressed appreciation and support for the inclusion of ‘‘companions’’ in the text of § 92.202. One commenter added that doctors and hospitals have told patients that their legal counsel informed them that they are not obligated to provide communication access to anyone who is not a patient. One commenter recommended that OCR include that the selection of ‘‘appropriate’’ companion(s) be made by the individual not the provider. Response: Section 1557 requires that covered entities ensure effective communication for individuals with disabilities, including companions. The definition in § 92.4 is consistent with the definition of ‘‘companion’’ from the implementing regulations for title II of the ADA, which similarly requires that a public entity ‘‘take appropriate steps to ensure that communications with . . . companions with disabilities are as effective as communications with others.’’ 28 CFR 35.160(a). Comment: A couple of commenters mentioned that patients are sometimes told that due to confidentiality they cannot have a friend, family member, advocate, or attorney be present for an appointment for effective communication purposes. One commenter provided the following example: An individual with Autism Spectrum Disorder (ASD) was required to enter the hospital without his mom, VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 who could assist him in communicating, and likely because of that he was misdiagnosed and required to return to the emergency room within a week. Response: Unless a covered entity has a specific confidentiality concern regarding the presence of a specific companion, the individual with a disability should be permitted to select a companion and have them present when accessing a covered health program or activity. Further, and consistent with instruction under the ADA, a companion may need to help the patient with information or instructions given by hospital personnel.140 Companions may be an essential part of ensuring an individual with a disability is afforded effective communication and should not be separated from an individual with a disability outside of extenuating circumstances. However, we note that a covered entity may not rely on a person accompanying an individual with a disability to interpret or otherwise facilitate communication; this is only permitted when the individual with a disability specifically requests that an accompanying adult interpret or facilitate communication, the accompanying adult agrees to provide such assistance, and reliance on that adult for such assistance is appropriate under the circumstances. See 28 CFR 35.160(c)(2)(ii), incorporated by § 92.202. Comment: Several commenters thanked OCR for proposing to restore the requirements for quality measures in VRI, while some raised concerns regarding the appropriateness of VRI in various circumstances. They shared that, for example, VRI may not be effective for a person lying on their back for a medical procedure due to challenges with viewing the screen and that VRI has been inappropriately used during high-risk childbirth. Yet another commenter mentioned that VRI is not appropriate for individuals who are deafblind (i.e., individuals who have combined hearing and vision loss that limit access to both auditory and visual information). One commenter expressed concern that a provider made it a policy that their facility only uses VRI and never uses the services of in-person interpreters. Response: We acknowledge the concerns with VRI and note that it may not provide effective communication for all individuals in all situations. Covered entities are required to take appropriate steps to ensure that communications with individuals with disabilities are as 140 75 PO 00000 FR 56183, 56223–24 (Sept. 15, 2010). Frm 00065 Fmt 4701 Sfmt 4700 37585 effective as communications with individuals without disabilities in their health programs and activities. If the use of VRI does not provide an individual equal opportunity to participate in or benefit from the service in question, then the communication is ineffective and does not meet section 1557 requirements. Several cases have found that VRI was ineffective due to hospital staff’s lack of knowledge about how to operate the VRI equipment or technology issues with the equipment itself, including the attempted use of VRI during labor.141 Settlement agreements with the United States have similarly found concerns with VRI, including one settlement decree that specified that VRI would not be considered effective in specific situations, including situations due to: ‘‘(1) a patient’s limited ability to move his or her head, hands or arms; vision or cognitive issues; or significant pain; (2) space limitations in the room; (3) the complexity of the medical issue; or (4) any other time when there are indicators that VRI is not providing effective communication.’’ 142 This enforcement activity suggests that VRI may not always afford a person with a disability an equal opportunity to participate in and enjoy the benefits of the program or activity of a covered entity. Thus, policies that require the exclusive use of VRI, or the exclusive use of any particular auxiliary aid or service, are likely to result in the eventual failure to provide effective communication and therefore should not be adopted. Comment: One patient advocacy group recommended that OCR emphasize that family members should not act as interpreters for a deaf or hard of hearing patient, except in certain exigent circumstances. 141 Sunderland v. Bethesda Hosp., Inc., 686 F. App’x 807 (11th Cir. 2017); Silva v. Baptist Health S. Fla., Inc., 303 F. Supp. 3d 1334 (S.D. Fla. 2018), aff’d in part, vacated in part, remanded, 838 F. App’x 376 (11th Cir. 2020); Juech v. Children’s Hosp. & Health Sys., Inc., 353 F. Supp. 3d 772 (E.D. Wis. 2018); Settlement Agreement Between the United States of America and Floyd Medical Center (2016), https://archive.ada.gov/floyd_sa.html; see also Manako Yabe, Healthcare Providers’ and Deaf Patients’ Interpreting Preferences for Critical Care and Non-Critical Care: Video Remote Interpreting, 13.2 Disability and Health J. 100870 (2020), https:// pubmed.ncbi.nlm.nih.gov/31791822/; Nat’l Ass’n for the Deaf, Minimum Standards for Video Remote Interpreting Services in Medical Settings, https:// www.nad.org/about-us/position-statements/ minimum-standards-for-video-remote-interpretingservices-in-medical-settings/. 142 Settlement Agreement Between the U.S. and Swedish Edmonds Hospital (2014), https:// archive.ada.gov/swedish_edmonds_sa.htm; Settlement Agreement Between the U.S. and Grady Memorial Hospital (2016), https://archive.ada.gov/ grady_sa.html. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37586 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Response: Covered entities are responsible for providing effective communication, including through utilizing the services of a qualified interpreter, and cannot require an individual to bring someone to interpret for them. Persons with disabilities can, however, bring an interpreter of their choosing, including a family member, and OCR declines to add the suggested language prohibiting this choice. This approach is consistent with existing ADA title II regulations, 28 CFR 35.160(c), and with the approach OCR has followed in the section 504 proposed rule. 88 FR 63392, 63508 (Sept. 14, 2023) (proposed 45 CFR 84.77(c)(2)(ii)). Comment: One group recommended that the final rule include language that requires health care entities to consider a patient’s preference for gender of the interpreter as a means of ensuring more effective communication. This group noted that given the intimate nature of medical assessments and treatments, patients may not be comfortable with an interpreter of a different gender than themselves, particularly in settings that involve nudity such as in an obstetrics and gynecology appointment. Response: While OCR appreciates that a patient may prefer an interpreter of a particular gender and recommends consideration of a patient’s preference for a particular gender whenever possible, including when the request is made based on an individual’s religious practices and beliefs, we decline to include such language in the rule regarding the gender of a qualified interpreter for an individual with a disability. OCR notes that some organizations, such as the National Association of the Deaf and Deaf Seniors of America, have issued position statements to guide providers in adopting internal VRI policies, and have stated that medical providers ‘‘shall honor the preference of the deaf or hard of hearing patient and/or companion with respect to the gender of video interpreter.’’ 143 However, OCR notes that whether a covered entity has ensured their communication is effective for an individual with disability does not inherently depend on whether the covered entity is able to satisfy a patient’s preference regarding the interpreter’s gender. Comment: An organizational commenter said that providers should be required to ‘‘affirmatively ask’’ patients what they need to make 143 Nat’l Ass’n of the Deaf, Minimum Standards for Video Remote Interpreting Services in Medical Settings, https://www.nad.org/about-us/positionstatements/minimum-standards-for-video-remoteinterpreting-services-in-medical-settings/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 documents accessible and should document that requirement so that it does not need to be repeatedly asked and answered. Response: OCR understands the frustration experienced by individuals who have to inform their providers of their need to receive communication in accessible formats multiple times. We note that the Department has implemented a process by which Medicare beneficiaries who are blind or have low vision can request Medicare Summary Notices in an accessible format, and following the initial request, the required accessible format will be the default format of the document mailed to the beneficiary.144 We recognize this as a best practice, and while we decline to require that such need be documented, we encourage covered entities to implement such a practice in the written effective communication procedures required under § 92.8(e). Comment: Some organizational commenters urged OCR to incorporate the following OCR guidance documents directly into the final regulations, as well as all subsequent similar guidance, technical assistance, and enforcement activities: enforcement efforts related to support persons in hospital settings145 and Bulletin on Civil Rights, HIPAA, and the Coronavirus Disease 2019.146 Response: OCR thanks commenters for their suggestion to incorporate guidance and enforcement materials into the final rule. Guidance documents advise members of the public how an agency understands its legal authorities.147 Similarly, covered entities and others may be able to look to OCR’s enforcement to gain clarity regarding regulatory requirements. As guidance, technical assistance, and 144 Beneficiaries can find information on how to request Medicare Summary Notices in accessible formats at Medicare.gov, Accessibility & Nondiscrimination Notice, https:// www.medicare.gov/about-us/accessibilitynondiscrimination-notice; see also 88 FR 22120, 22122 (April 12, 2023). 145 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., OCR Resolves Complaints after State of Connecticut and Private Hospital Safeguard the Rights of Persons with Disabilities to Have Reasonable Access to Support Persons in Hospital Settings During COVID–19 (June 9, 2020), https:// public3.pagefreezer.com/content/HHS.gov/31-122020T08:51/https://www.hhs.gov/about/news/2020/ 06/09/ocr-resolves-complaints-after-stateconnecticut-private-hospital-safeguard-rightspersons.html. 146 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., March 28, 2020 BULLETIN: Civil Rights, HIPAA, and the Coronavirus Disease 2019 (COVID– 19) (Mar. 28, 2020), https://www.hhs.gov/guidance/ document/march-28-2020-bulletin-civil-rightshipaa-and-coronavirus-disease-2019-covid-19. 147 Kisor v. Wilkie, 139 S. Ct. 2400, 2420 (2019) (plurality opinion) (quoting Perez v. Mortgage Bankers Ass’n, 575 U.S. 92, 97 (2015)). PO 00000 Frm 00066 Fmt 4701 Sfmt 4700 enforcement activities are constantly evolving, we decline to codify the referenced materials in this rule. Comment: Multiple commenters, including organizations, recommended that § 92.202(b) explicitly parallel the language in § 92.201(b) by stating that auxiliary aids and services must be provided free of charge, be accurate and timely, and protect the privacy and the independent decision-making of the individual with a disability. The commenters noted that while this section adopts by reference 28 CFR 35.160 through 35.164 (ADA title II communication requirements), some covered entities may simply read the regulatory language and note the difference in language between §§ 92.201 and 92.202. Noting this difference, several commenters also requested that OCR develop technical assistance materials on 28 CFR 35.160 through 35.164 in plain language. Response: Like multiple places in this regulation, the text of § 92.202 adopts ADA title II standards by reference, including the requirements related to auxiliary aids and services. OCR appreciates the concerns raised by commenters regarding the apparent lack of parity between §§ 92.201(b) and 92.202(b), and how this may lead to confusion on behalf of covered entities and the public and may increase the likelihood that individuals with disabilities may either not receive or may be required to pay for auxiliary aids and services. Therefore, in light of comments received and continued compliance concerns, we are revising § 92.202(b) as follows. First, OCR is revising the text, consistent with 28 CFR 35.160(b)(1), to clarify that all individuals with disabilities must be afforded appropriate auxiliary aids and services and an equal opportunity to ‘‘participate in and enjoy the benefits of’’ the health program or activity in question. Further, OCR agrees with commenters that it is important that those reading this regulation can immediately identify that appropriate auxiliary aids and services must be provided free of charge. Some commenters and our enforcement experience demonstrate that this requirement, similar to that in the ADA and section 504, is not always clear or adhered to by covered entities. Thus, OCR is adding a sentence to § 92.202(b) stating that auxiliary aids and services must be provided free of charge. OCR notes that this is similar to the approach taken in DOJ’s implementing regulations for title II and title III of the ADA, which forbid surcharges on persons with disabilities or groups of persons with disabilities to E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 cover the provision of auxiliary aides and services. 28 CFR 35.130(f) (title II), 36.301(c) (title III). For parity with 28 CFR 36.160(b)(2) and 45 CFR 92.201(b), we are also revising the text to clarify that auxiliary aids and services must be provided in accessible formats, in a timely manner, and in such a way to protect the privacy and the independence of the individual with a disability. OCR appreciates commenters’ suggestion to develop technical assistance materials regarding effective communication under 28 CFR 35.130 and 35.160 through 35.164. These are regulations promulgated and enforced by DOJ, and we will continue to coordinate and collaborate with DOJ to develop technical assistance materials related to effective communication requirements under our respective authorities.148 Comment: A few organizational commenters argued that the provision of auxiliary aids and services is necessary but not a sufficient tool for avoiding and remedying effective communication discrimination. The commenters said that individuals who cannot rely on natural speech for effective communication require ‘‘effective access to the robust language-based alternative and augmentative communication they need to express themselves and be understood.’’ Another group said that OCR should expand on the definition of ‘‘auxiliary aids and services’’ to include plain language and screen reader capabilities. Response: Covered entities are required take appropriate steps to ensure effective communication. Though the provision of appropriate auxiliary aids and services is addressed in § 92.202(b), the examples of auxiliary aids and services provided at § 92.4 (Definitions) is non-exhaustive and covered entities may use additional auxiliary aids and services to achieve effective communication. Effective communication for patients with cognitive, neurological, and psychiatric disabilities may require auxiliary aids and services or strategies different from those employed with patients with other disabilities. For example, while an individual who is deaf or hard of hearing may require an ASL interpreter to effectively 148 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Disability Resources for Effective Communication, https://www.hhs.gov/civil-rights/ for-individuals/special-topics/hospitals-effectivecommunication/disability-resources-effectivecommunication/; see also Medicaid.gov, Unwinding Documents, https://www.medicaid.gov/ resources-for-states/coronavirus-disease-2019covid-19/unwinding-and-returning-regularoperations-after-covid-19/state-letters/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 communicate with a provider, an individual with a cognitive disability may require additional time with the provider to ask questions and receive plain language answers about a specific health care decision. In addition, one type of auxiliary aid or service that may be required is the acquisition or modification of equipment or devices, including for augmentative and alternative communication, and the provision of training and assistance to the individual with a disability on how to use them. Augmentative and alternative communications devices include, but are not limited to, speech generating devices, single-message devices, computers, tablets, smartphones, amplification devices, telecommunications devices, voice amplifiers, artificial phonation devices, picture and symbol boards, paper-based aids, and other equipment or devices used to compensate for impairments to speech-language production or comprehension, including spoken and written modes of communication. In some instances, the use of augmentative and alternative communication is necessary for individuals with certain disabilities that impair speech production and comprehension to access vital health and human services programs and activities. Often, the most effective way for recipients to ensure effective communication is to provide training on the use of this equipment. Comment: A health care organization requested that this provision should be modified to state that covered entities ‘‘must make a reasonable attempt’’ to provide auxiliary aids and services, ‘‘unless the covered entity can demonstrate that providing such auxiliary aids or services would fundamentally alter the nature of the service in question or result in an undue burden, i.e., significant difficulty or expense.’’ Response: OCR declines to modify the standard for effective communication, which requires that covered entities ensure that communications with people with disabilities are as effective as communications with others. The language on fundamental alteration or undue burden related to the provision of communications, found in 28 CFR 35.164, is already adopted into this section by reference. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.202, with modification. We are revising § 92.202(b) to read: ‘‘A covered entity PO 00000 Frm 00067 Fmt 4701 Sfmt 4700 37587 must provide appropriate auxiliary aids and services where necessary to afford individuals with disabilities an equal opportunity to participate in, and enjoy the benefits of, the health program or activity in question. Such auxiliary aids and services must be provided free of charge, in accessible formats, in a timely manner, and in such a way to protect the privacy and the independence of the individual with a disability.’’ Accessibility for Buildings and Facilities (§ 92.203) In § 92.203, we proposed adding a general provision establishing that no qualified individual with a disability shall, because a covered entity’s facilities are inaccessible to or unusable by individuals with disabilities, be denied the benefits of, be excluded from participation in, or otherwise be subjected to discrimination under any health program or activity to which this part applies, consistent with OCR’s section 504 regulation. OCR also proposed incorporating the identical language found in the 2020 Rule at § 92.103, except that the definitions for 1991 Americans with Disabilities Act Standards for Accessible Design (1991 ADA Standards), 2010 ADA Standards for Accessible Design (2010 ADA Standards), and Uniform Federal Accessibility Standards (UFAS), Public Law 90–480; 42 U.S.C. 4151 et seq., are now located in § 92.4. OCR also notes that the section 504 regulatory provisions incorporated into subpart B in this regulation contain program accessibility requirements that apply to existing facilities as well as new construction and alterations. Title II of the ADA and section 504 require that covered entities operate their programs and activities so that, when viewed in their entirety, they are readily accessible to individuals with disabilities; neither statute has been interpreted to require that each existing facility be made accessible.149 Nearly all of the entities subject to the facility access requirements in the final rule are also subject to facility access requirements under section 504 and the ADA. Section 92.203 establishes specific accessibility standards for new construction and alterations under section 1557. The comments and our responses regarding § 92.203 are set forth below. Comment: Some commenters emphasized the importance of a 149 See 28 CFR 35.150(a); 45 CFR 84.22(a); Bird v. Lewis & Clark Coll., 303 F.3d 1015, 1021 (9th Cir. 2002) (‘‘the central inquiry [under the ADA and section 504] is whether the program, when viewed in its entirety is readily accessible to and usable by individuals with disabilities’’). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37588 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations continued push towards universal compliance with the 2010 ADA Standards. Many commenters also noted how critical it would be for OCR to provide oversight to ensure that covered entities’ buildings and facilities come into compliance with the 2010 ADA Standards. These commenters also noted that the uniform application of the 2010 ADA Standards will also enable greater consistency among implementing agencies. Response: OCR appreciates the comments regarding the existing standards and the push towards universal compliance with the 2010 ADA Standards and will continue to retain the requirement that new construction or alteration of buildings or facilities must comply with the 2010 ADA Standards. Comment: Some commenters did not support the incorporation of 45 CFR 84.23(c) at § 92.101(b) because they stated it would allow facilities to only conform with UFAS instead of the more recent 1991 ADA Standards or 2010 ADA Standards. They also expressed concern that the application of the UFAS to new facilities would be outdated. These commenters believe that the UFAS permits facilities to maintain barriers that exclude people with disabilities that impact their mobility or strength. Response: OCR appreciates the commenters concerns regarding the incorporation of the UFAS. However, this rule does not allow UFAS to be used as the accessibility standard for new facilities. UFAS is only used to determine if a building built before July 18, 2016, was designed and constructed in accordance with the standards at the time. Any alteration or addition of any building or facilities built after July 18, 2016, must follow the 2010 ADA Standards. Comment: Some commenters also recommend incorporating existing standards relating to accessible Medical and Diagnostic Equipment (MDE) that were developed by the U.S. Access Board. 82 FR 2810 (Jan. 9, 2017), codified at 36 CFR part 1195 (U.S. Access Board 2017 Standards for MDE). Commenters also noted that the lack of access to MDE should constitute both a discriminatory benefit design and network inadequacy. Response: On September 14, 2023, OCR published a NPRM proposing modifications to the implementing regulations for section 504. The NPRM proposes adopting the U.S. Access Board 2017 Standards for MDE used by recipients of Federal financial assistance to ensure accessibility for patients with disabilities. 88 FR 63450–55, 63511 VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 (proposed 45 CFR 84.92). OCR will continue to address accessible MDE in that rulemaking. Summary of Regulatory Changes For the reasons set forth above and considering the comments received, we are finalizing the provisions as proposed in § 92.203 with modification. We are making two technical corrections to add ‘‘or alteration’’ after ‘‘construction’’ in § 92.203(b) and (c) for consistency with the description of the 2010 Standards elsewhere in the provision. We have replaced the phrase ‘‘and such facility was not covered by the 1991 Standards or 2010 Standards’’ in § 92.203(c) with ‘‘and such facility would not have been required to conform with a different accessibility standard under 28 CFR 35.151’’ for clarity and consistency. We have also added language clarifying the timeframes for compliance with either the 2010 Standards or the UFAS standards for existing facilities where construction or alteration was begun on or after July 18, 2016, and on or before January 18, 2018, in conformance with UFAS but the facility or part of the facility was not covered by the 2010 Standards. That addition reads, ‘‘If construction or alteration was begun on or after July 18, 2016, and on or before January 18, 2018, in conformance with UFAS, and the facility or part of the facility was not covered by the 2010 Standards prior to July 18, 2016, then it shall be deemed to comply with this section requirements of this section and with 45 CFR 84.23(a) and (b).’’ Accessibility of Information and Communication Technology for Individuals With Disabilities (§ 92.204) Proposed § 92.204 addressed the accessibility of information and communication technology (ICT) for individuals with disabilities. In § 92.204(a), OCR proposed requiring covered entities to ensure that their health programs and activities provided through ICT are accessible to individuals with disabilities, unless doing so would result in undue financial and administrative burdens or a fundamental alteration in the nature of the health programs or activities. If an action required to comply with this subpart would result in such an alteration or burdens, a covered entity is required to take any other action that would not result in such an alteration or burdens but would nevertheless enable, to the maximum extent possible, individuals with disabilities to receive the benefits or services of the health program or activity provided by the covered entity. PO 00000 Frm 00068 Fmt 4701 Sfmt 4700 In § 92.204(b), OCR proposed requiring recipients and State Exchanges to ensure that their health programs and activities provided through websites and mobile applications comply with the requirements of section 504 as interpreted in a manner consistent with title II of the ADA. Given the crucial role that ICT can play for individuals with disabilities accessing health programs and activities, OCR sought comment on whether the section 1557 rule should include a provision requiring covered entities to comply with specific accessibility standards, such as the Web Content Accessibility Guidelines (WCAG) developed by the Web Accessibility Initiative. Additionally, OCR invited comments on whether to adopt a safe harbor provision under which covered entities that are in compliance with established specific accessibility standards are deemed in compliance with proposed § 92.204(a) and (b); whether OCR should require covered entities to comply with the most recent edition of a published standard; and the timeline necessary for covered entities to come into compliance with a new standard. The comments and our responses regarding § 92.204 are set forth below. Comment: Many commenters, including civil rights groups, health care organizations, and a group of Federal elected officials, expressed general support for the ICT requirements for people with disabilities in the Proposed Rule. Several commenters said they are concerned that this section only focuses on accessibility for individuals with disabilities, saying that this section should be applicable to all individuals covered by section 1557. These commenters noted that section 1557’s nondiscrimination mandate guards against discrimination on the basis of race, color, national origin, sex, and age, as well as disability. Therefore, these commenters recommended that § 92.204 provide that covered entities must ensure that their health programs or activities provided through ICT are accessible to individuals on all protected bases, not just disability. Response: Section 92.204 prohibits discrimination based on disability in health programs and activities provided through ICT because individuals with certain disabilities are often unable to access certain aspects of ICT when that ICT is not developed to be accessible. For example, OCR has received complaints from people with disabilities, including those who are blind or have low vision, alleging that the ICT of covered entities is E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 inaccessible to them and not compatible with screen reader software, resulting in a denial of access to health programs and activities. While § 92.204 addresses ICT accessibility issues for individuals with disabilities, it does not limit the application of general nondiscrimination principles found throughout section 1557 regulations to the accessibility of health programs and activities offered through ICT to other groups. Thus, the general prohibition against discrimination set forth in § 92.101(a) requires the accessibility of health programs and activities offered through ICT, without discrimination on the basis of race, color, national origin, sex, age, or disability. Comment: Several groups recommended adding that ‘‘covered entities must procure, design, maintain and use accessible ICT in all aspects of providing health programs and activities’’ to remind covered entities that their civil rights obligations apply in procurements. One group said that OCR should clarify that covered entities should be aware that third-party providers of ICT are not directly covered by this regulation, and that covered entities are obligated to ensure that they procure ICT that is accessible. Several commenters suggested the use of a Voluntary Product Accessibility Template,150 a document that indicates compliance with section 508 standards,151 should be completed by the third-party vendors. Response: Regardless of the method that a covered entity uses to acquire ICT, the health programs and activities it provides through that ICT must be accessible to individuals with disabilities. Due to the increasing importance of ICT in the provision of health care, health insurance coverage, and other health-related coverage, OCR will continue to closely monitor this area. Both OCR and DOJ recently issued NPRMs addressing the accessibility of web content and mobile apps used by recipients of Federal financial assistance and public entities, respectively.152 Those rulemakings provide greater clarity on obligations to ensure that web content and mobile applications are accessible. Comment: An organizational commenter asked OCR to provide more 150 Section508.gov, Voluntary Product Accessibility Template (VPAT), https:// www.section508.gov/sell/vpat/. 151 36 CFR part 1194, appendix A. Section 508 of the Rehabilitation Act imposes accessibility requirements for information and communication technology that Federal departments and agencies develop, procure, maintain, or use. 152 88 FR 63392 (Sept. 14, 2023) (HHS) and 88 FR 51948 (Aug. 4, 2023) (DOJ). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 guidance on what constitutes undue burden or fundamental alteration. Response: This rulemaking does not create a different standard for fundamental alteration or undue burden beyond the standards in section 504 and the ADA. As DOJ noted in its August 4, 2023 NPRM, Nondiscrimination on the Basis of Disability; Accessibility of Web Information and Services of State and Local Government Entities, there are current undue burden and fundamental alteration limitations in the ADA title II regulation that are familiar to public entities. 88 FR 51948, 51978. The current limitations are in the ADA title II implementing regulation at 28 CFR 35.150(a)(3) (program accessibility) and 35.164 (effective communication) for fundamental alteration and undue burden limitations and 28 CFR 35.130(b)(7) (reasonable modifications in policies, practices, or procedures) for fundamental alteration limitations. DOJ also provides additional context for fundamental alteration and undue burden on its ADA.gov website.153 Additionally, DOJ’s technical assistance manual on title III of the ADA provides guidance on what constitutes fundamental alteration and undue burden for public accommodations under title III.154 Comment: A professional association asked OCR to work with small, independent, and under-resourced physician practices to ensure they have the resources, tools, and financial assistance necessary to ensure ICT accessibility for patients with disabilities. Response: OCR will continue to develop technical assistance and educational materials to assist covered entities’ compliance with section 1557 and this regulation. However, we are unable to provide other resources or financial assistance to ensure ICT accessibility. Comment: One organizational commenter said that OCR should provide technical assistance to covered entities servicing populations with digital inequities, such as populations of older adults that may not be as digitally 153 See U.S. Dep’t of Justice, State and Local Governments, https://www.ada.gov/topics/title-ii/. 154 See U.S. Dep’t of Justice, ADA Title III Technical Assistance Manual, https://www.ada.gov/ resources/title-iii-manual/. This guidance document on title III of the ADA defines fundamental alteration as ‘‘a modification that is so significant that it alters the essential nature of the goods, services, facilities, privileges, advantages, or accommodations offered.’’ It defined undue burden as a ‘‘significant difficulty or expense’’ that can be determined based on the nature and cost of the action, the overall financial resources of the site involved, geographical separateness, overall financial resources of the parent entity, and the type of operation of the parent entity. PO 00000 Frm 00069 Fmt 4701 Sfmt 4700 37589 savvy or individuals who do not have stable internet connections. Response: OCR recognizes that many people lack internet connectivity and may therefore be unable to access webbased tools and resources provided by covered entities, and OCR encourages entities to develop creative means to meet the needs of these individuals. However, though this issue may raise civil rights concerns in some contexts, it is outside the scope of this regulation. Covered entities have general nondiscrimination obligations under § 92.101(a), including that a covered entity may not discriminate based on age. Accordingly, covered entities that use web-based health programs and activities must ensure that older adults are not denied participation, denied benefits, or otherwise discriminated against in the provision of those webbased health programs and activities. For example, a covered entity may not decline to provide an electronic appointment reminder to an older individual because of a stereotype that older individuals may experience difficulties using such technology. Comment: One organizational commenter recommended extending the full ICT requirements to recipients and State exchanges. Response: Recipients and State Exchanges are required to comply with both § 92.204(a) and (b), per the text of the section. Comment: Multiple commenters requested the explicit inclusion of mobile applications within this section. They stated that it would spur greater awareness among software developers of the need for fully accessible mobile applications that are also compatible with mobile devices and internet platforms. One organizational commenter warned that there could be privacy concerns with certain mobile apps used for substance use disorder treatment and recommended that OCR collaborate with the Substance Abuse and Mental Health Services Administration (SAMHSA) to determine if Federal privacy laws apply to mobile application health information, and communicate that information to consumers. Response: OCR appreciates these comments. Mobile applications are a form of information and communication technology and are explicitly included in the regulatory text under § 92.204(b); thus, to the extent covered entities use mobile applications as part of their health programs and activities they must be accessible for individuals with disabilities. Though privacy protections are outside of the scope of this rulemaking, OCR reminds commenters E:\FR\FM\06MYR4.SGM 06MYR4 37590 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 that it has issued guidance on the application of the HIPAA Privacy, Security, and Breach Notification Rules to mobile health apps.155 Comment: Many commenters recommended OCR require covered entities to comply with specific accessibility standards, such as section 508 standards, the WCAG 2.0 standards, the WCAG 2.1 standards, or other standards that provide equal or greater accessibility. Several commenters, including organizations, recommended requiring covered entities to comply over time with the latest WCAG as they are updated by the Web Accessibility Initiative of the World Wide Web Consortium (W3C). The commenters also said that a requirement to adhere to the latest standards could offer a range of time for compliance, with larger entities that have more resources being required to comply with a new WCAG standard within a shorter timeline than smaller entities. A technology company said that OCR should not establish a requirement to conform to the latest standard, but rather a requirement to conform to technical specifications that are proven and generally accepted for achieving and maintaining reasonable levels of accessibility; currently that is WCAG 2.1 levels A and AA. Some organizational commenters suggested that OCR should incorporate a functional, evergreen standard for accessibility that will adapt to changes in technology and accessibility practices. Such a standard would require the ICT to be perceivable, operable, understandable, and robust, and ‘‘enable individuals with disabilities to access the same information as, to engage in the same interactions as, to communicate and to be understood as effectively as, and to enjoy the same services offered to other individuals with the same privacy, same independence, and same ease of use as, individuals without disabilities.’’ Several commenters, including health care organizations, advocacy groups, and a trade association, offered suggestions for the timeline for compliance with new standards. These included 60 days, 12 months, 18 months, and 2 years. A health care organization recommended that OCR only require initial compliance in fields that are ‘‘critical to utilizing telehealth 155 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Resources for Mobile Health Apps Developers, https://www.hhs.gov/hipaa/forprofessionals/special-topics/health-apps/ index.html; U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Protecting the Privacy and Security of Your Health Information When Using Your Personal Cell Phone or Tablet, https:// www.hhs.gov/hipaa/for-professionals/privacy/ guidance/cell-phone-hipaa/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 services’’ and that covered entities be required to meet the minimum conformance levels of the two most recent versions of the W3C guidelines. Some commenters supported compliance with accessibility standards, provided that OCR conducts real-world testing with successful results across a variety of physician offices before requiring compliance. The commenter also suggested that OCR work with the Office of the National Coordinator for Health Information Technology and vendors to ensure that compliance does not place an undue financial or administrative burden on physician practices. Expressing concern about the cost of compliance, a professional association requested an exemption for businesses classified as small businesses by the Small Business Administration. A few commenters, including a trade association, health care organizations, and health insurance entities, suggested that OCR establish a safe harbor by which covered entities compliant with WCAG 2.1 Level AA are deemed in compliance with the section 1557 requirements. Other commenters argued that OCR should not establish a safe harbor because compliance with a set of accessibility standards is not necessarily evidence of compliance with accessibility requirements; there may be ICT that meets published standards but remains inaccessible. Another commenter said OCR should not establish a safe harbor because the ADA, the Rehabilitation Act, and other Federal laws must continue to provide standalone protections. Response: OCR appreciates commenters’ input on this important topic but has decided not to adopt specific accessibility standards or a safe harbor at this time. This is in part due to OCR and DOJ recently publishing NPRMs proposing specific accessibility requirements for section 504 and title II of the ADA, respectively.156 Those NPRMs propose to require that recipients of Federal financial assistance and public entities must ensure that their web content and mobile applications comply with set accessibility standards. In this rulemaking, OCR continues to require covered entities to ensure that health programs and activities provided through ICT are accessible to individuals with disabilities sufficient to provide equal access to the health program or activity, unless doing so would impose undue financial and administrative burdens or would result in a fundamental alteration in the nature 156 See 88 FR 63392 (Sept. 14, 2023) (section 504) and 88 FR 51948 (Aug. 4, 2023) (ADA title II). PO 00000 Frm 00070 Fmt 4701 Sfmt 4700 of the entity’s health program or activity. OCR strongly encourages covered entities that offer health programs and activities through ICT to incorporate current WCAG standards as they take steps to ensure that those programs and activities comply with requirements of this regulation and other Federal civil rights laws. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.204, without modifications. Requirement To Make Reasonable Modifications (§ 92.205) In § 92.205, we proposed requiring covered entities to make reasonable modifications to policies, practices, or procedures when such modifications are necessary to avoid discrimination on the basis of disability, unless the covered entity can demonstrate that making the modifications would fundamentally alter the nature of the health program or activity. Section 92.205 is the same as § 92.205 in the 2016 Rule and § 92.105 in the 2020 Rule. The term ‘‘reasonable modifications’’ will be interpreted as set forth in the regulation implementing title II of the ADA at 28 CFR 35.130(b)(7), such that ‘‘[a covered entity] shall make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability, unless the [covered entity] can demonstrate that making the modifications would fundamentally alter the nature of the [health] service, program, or activity’’ and ‘‘[a covered entity] is not required to provide a reasonable modification to an individual who meets the definition of ‘disability’ solely under the ‘regarded as’ prong of the definition of ‘disability’ at § 35.108(a)(1)(iii).’’ The comment and our response regarding § 92.205 are set forth below. Comment: One commenter urged OCR to strengthen the section by adding language to clarify that a modification to add something that is medically necessary for individuals with disabilities, or to eliminate exclusions related to medically necessary services, are not considered fundamental alterations to the nature of the health program. Response: OCR appreciates the commenter’s request for clarifying language related to fundamental alterations. In promulgating this rule, OCR cannot address how the requirements of section 1557 apply to every scenario that may arise. OCR also E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations cannot state every modification that could result in a fundamental alteration because determining whether a modification is a fundamental alteration is a fact-specific process. ddrumheller on DSK120RN23PROD with RULES4 Summary of Regulatory Changes For the reasons set forth above and considering the comments received, we are finalizing the provisions as proposed in § 92.205, without modification. Equal Program Access on the Basis of Sex (§ 92.206) OCR proposed a section clarifying covered entities’ obligation to ensure equal access to their health programs and activities without discrimination on the basis of sex. In proposed § 92.206(a), we described a covered entity’s general obligation to provide individuals equal access to the covered entity’s health programs or activities without discrimination on the basis of sex. In proposed § 92.206(b)(1) through (4), we clarified certain types of discriminatory actions that would be prohibited for a covered entity in its provision of access to health programs or activities. In § 92.206(b)(1), we proposed prohibiting a covered entity from denying or limiting health services, including those that are offered exclusively to individuals of one sex, to an individual based on the individual’s sex assigned at birth, gender identity, or gender otherwise recorded. In § 92.206(b)(2), we proposed prohibiting covered entities from denying or limiting a health care professional’s ability to provide health services on the basis of a patient’s sex assigned at birth, gender identity, or gender otherwise recorded. In § 92.206(b)(3), we proposed prohibiting a covered entity from applying any policy or practice of treating individuals differently or separating them on the basis of sex in a manner that subjects any individual to more than de minimis harm. In § 92.206(b)(4), we proposed prohibiting a covered entity from denying or limiting health services sought for the purpose of genderaffirming care that the covered entity would provide to a person for other purposes if the denial or limitation is based on a patient’s sex assigned at birth, gender identity, or gender otherwise recorded. In § 92.206(c), we proposed that nothing in this section requires the provision of any health service where the covered entity has a legitimate, nondiscriminatory reason for denying or limiting that service, including where VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 the covered entity reasonably determines that such health service is not clinically appropriate for that particular individual. In § 92.206(d), we proposed that the enumeration of specific forms of discrimination in paragraph (b) does not limit the general applicability of the prohibition in paragraph (a). The comments and our responses regarding § 92.206 are set forth below. Comment: Numerous commenters supported OCR’s proposal to specifically address equal access on the basis of sex in the final rule. A supporter of the provision argued that patients who trust their provider not to discriminate against them will share better information, enabling better treatment. Some commenters specifically requested this section be strengthened by including specific examples of what constitutes discrimination based on sex characteristics. Response: OCR agrees that open communication between a provider and their patient is a bedrock of the provision of quality care, and that cannot happen where the patient experiences or expects that they will face discrimination by the provider. In addition, we note that the question of whether prohibited discrimination has occurred is often context specific and fact intensive, so it is difficult to provide succinct examples of scenarios that would constitute prohibited discrimination in each and every instance. Comment: Commenters urged OCR to include specific language related to reproductive health care and fertility treatments in §§ 92.206 and 92.207. A few commenters urged OCR to specify the full range of reproductive health care protected from discrimination under section 1557, including protections against discrimination based on reproductive health decisions. A few commenters said the final rule should make clear that section 1557 prohibits discrimination related to maternity care, such as failing to provide accessible medical equipment or transfer assistance, leaving wheelchair users unable to access care. Another commenter opined that the final rule should make clear that section 1557 prohibits discrimination relating to treating pregnancy emergencies and complications, including termination of pregnancy, miscarriage management, and other pregnancy outcomes. Response: Matters related to reproductive health care, fertility, pregnancy, family status, and maternity care are addressed in § 92.208, and OCR refers commenters to that section. PO 00000 Frm 00071 Fmt 4701 Sfmt 4700 37591 Covered entities must ensure accessibility of their health programs and activities for individuals with disabilities, which includes accessible equipment and transfer assistance. Comment: Some commenters argued that it would be more appropriate to address the impacts of the Dobbs decision and protections against discrimination on the basis of obtaining an abortion in § 92.206 rather than in § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status), because addressing abortion in the section on marital, parental, or family discrimination could convey that denying abortion care is only discriminatory in those contexts. Conversely, many commenters expressed opposition to the inclusion of termination of pregnancy within the scope of equal program access on the basis of sex, primarily stating that the rule would force health care professionals to perform abortions or deem their refusal to do so discrimination. Response: OCR appreciates commenters’ feedback regarding the addition of pregnancy or related conditions in § 92.206 rather than in § 92.208. Based on a review of the totality of the comments, additional language has not been added to § 92.206, and we discuss this issue further in § 92.208. Further, the ACA itself provides that ‘‘[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A). OCR will comply with this provision. For further discussion regarding a health care professional’s decision not to provide an abortion, including due to a sincerely held religious belief or conscience objection to performing the procedure, see §§ 92.208 and 92.302. Comment: Many commenters recommended that in addition to the specific forms of discrimination based on gender identity, it is important to include specific forms of reproductive health and pregnancy-related care discrimination in § 92.206(b). Many commenters recommended incorporating a provision or provisions under § 92.206(b) to clarify that covered entities are prohibited from denying or limiting services—or denying or limiting a health professional’s ability to provide services—based on a patient’s E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37592 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations pregnancy or related conditions, including termination of pregnancy, contraceptive use, miscarriage management, assisted reproduction, fertility care, and pregnancy-related services. One of these commenters recommended that the language of this provision not be limited to reproductive or sexual ‘‘health care decisions,’’ as covered entities also discriminate based on reproductive and sexual health histories such as past experiences with sexual violence, which exist beyond the realm of services and that including ‘‘care’’ here could limit how covered entities understand this form of discrimination. Some commenters also stated that failure to codify some of the most prevalent forms of sex discrimination will directly undermine efforts to implement proposed §§ 92.101 and 92.206. Response: OCR appreciates the recommendations regarding discrimination based on pregnancy or related conditions, including the request to provide additional examples, and directs commenters to the discussion at § 92.208. The rule does not include language related to discrimination based on health care decisions. The rule is not so limited—it prohibits discrimination in health programs and activities generally. This includes discrimination on the basis of sex in the context of health decisions or histories related to reproductive and sexual health. Comment: Many commenters supported § 92.206 as important to ensure access to necessary health services that might otherwise be denied to people due to discrimination on the basis of sexual orientation or gender identity, with many providing specific examples of discrimination faced by LGBTQI∂ individuals. Some commenters recommended specifically addressing protections for LGBTQI∂ people seeking fertility treatments. A commenter recommended that OCR consider adding a subsection to § 92.206 or § 92.208 to discuss the prohibition of discrimination on the basis of sexual orientation and gender identity in access to fertility services, and provided examples of the numerous barriers that LGBTQI∂ individuals and same-sex couples face in accessing this type of reproductive health care. Response: Section 1557 and this rule prohibit discrimination on the basis of sex, including sex characteristics, sexual orientation, and gender identity, in health care access. Depending on the specific facts at issue, barriers described may rise to the level of discrimination and would be evaluated under this rule’s general prohibition of discrimination under § 92.101(a)(1), to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 make a case-by-case determination as to whether prohibited discrimination has occurred. In general, OCR anticipates that if a covered entity elects to provide or cover fertility services, but categorically denies them to same-sex couples or to individuals on the basis of sexual orientation or gender identity, such a denial of care or coverage may violate section 1557’s prohibition on sex discrimination. We decline to add such specific language to the regulatory text as proposed. Comment: Commenters recommended that OCR should add language to § 92.206(b) affirming that section 1557 prohibits covered entities from denying, limiting access to, or otherwise placing special caps, costs, or additional procedural requirements on medications or treatments needed specifically by people with disabilities, irrespective of whether those medications or treatments can also be used to end or complicate pregnancies or fertility. Response: We address special caps, costs, or additional procedural requirements related to health insurance coverage and other health-related coverage in § 92.207, and direct commenters to that section. A discussion of medications and treatments related to pregnancy and fertility care is in § 92.208. Comment: Many commenters recommended including ‘‘transgender status’’ in § 92.206(b)(1), (2), and (4) because there have been instances in which those seeking to permit discrimination against transgender people have justified it by pressing distinctions between transgender status and gender identity. Response: As noted in the discussion for § 92.101(a)(2), the term ‘‘gender identity’’ necessarily encompasses transgender status and the two terms are often used interchangeably.157 We decline to enumerate the full range of identities protected under the term ‘‘gender identity.’’ Comment: Multiple commenters expressed support for the rule’s prohibition on denying or limiting care on the basis of a patient’s assigned sex at birth, gender identity, or gender otherwise recorded at § 92.206(b)(2). A commenter expressed support for the rule’s prohibition on covered entities denying or limiting a clinician’s ability to provide clinically appropriate care when the failure to do so would constitute discrimination. 157 See, e.g., Bostock v. Clayton Cnty., Georgia, 590 U.S. 644, 658–59 (2020); Doe v. Mass. Dep’t of Correction, No. CV 17–12255–RGS, 2018 WL 2994403 (D. Mass. June 14, 2018); Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034 (7th Cir. 2017). PO 00000 Frm 00072 Fmt 4701 Sfmt 4700 Another commenter supported this provision, arguing that it is necessary to ensure that specialists and providers who see LGBTQI+ patients every day do not experience retaliation for providing care. Pointing to State legislative efforts seeking to restrict or ban providers from offering safe and effective treatment to LGBTQI∂ patients, the commenter argued that such protections are particularly important to alleviate providers’ fears that they may be subject to retaliation or loss of licensure for providing gender-affirming care. Another commenter similarly argued that covered entities sometimes discriminate against transgender patients by prohibiting their providers from providing certain services. Response: As noted in the Proposed Rule, 87 FR 47866, this provision recognizes that prohibited discrimination may take the form of restrictions on individual providers, such as attending physicians, that have the effect of discriminating against patients. Where a covered entity imposes such a restriction based on a patient’s gender identity or sex assigned at birth, the restriction may constitute prohibited discrimination in violation of this rule, even if the form that the restriction takes is a limitation on the ability of providers to prescribe or provide care. Regarding providers’ fears that they may be subject to retaliation by their employer or loss of licensure, this rule does not apply to employment practices, as discussed in § 92.2(b), but employees of covered entities remain protected against retaliation as provided in §§ 92.303 and 92.304. Not all State licensure boards receive Federal financial assistance from the Department; upon receipt of a complaint against a licensure board, OCR would need to first determine whether we have jurisdiction before commencing an investigation. Also, we note that a health care provider’s decision not to provide any service due to a sincerely held religious belief or conscience objection is discussed further in §§ 92.208 and 92.302. Comment: Many commenters suggested that § 92.206(b)(2) would be clearer if the following phrase was deleted because it is redundant: ‘‘if such denial or limitation has the effect of excluding individuals from participation in, denying them the benefits of, or otherwise subjecting them to discrimination on the basis of sex under a covered health program or activity.’’ Response: OCR appreciates the suggestion and has considered it, but we E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations will maintain the proposed language, as the phrase provides additional explanation of what would constitute discrimination. As we noted in the Proposed Rule, 87 FR 47866, this is modeled on the provision in the title VI regulations that notes that certain discriminatory employment practices may be prohibited to the extent that they result in discrimination against program participants, even though the primary objective of title VI is not to regulate employment practices. See 45 CFR 80.3(c)(3). Likewise, the phrase commenters propose deleting here clarifies that these restrictions on providers are prohibited only insofar as they result in discrimination against individuals on the basis of sex in a covered health program or activity. This phrase is necessary to establish a violation because a discriminatory act under this rule is one in which the individual is excluded from, denied the benefits of, or otherwise subjected to discrimination under a health program or activity on the basis of sex. Comment: A few commenters stated that it appears that § 92.206(b)(2) is directly aimed at the United States Conference of Catholic Bishops’ Ethical and Religious Directives for Catholic Health Care Services.158 These commenters recommended that OCR disavow this provision and affirm support for the value of religiously affiliated health care and the right of faith-based hospitals to operate in accordance with their convictions. Response: As stated throughout this preamble, OCR values the vital role that faith-based hospitals and other health care providers and systems play in our nation’s health care system. With respect to concerns about potential conflicts between provisions of the final rule and individuals’ or organizations’ sincerely held religious beliefs, we refer commenters to the discussion at § 92.302. The aim of § 92.206(b)(2) is to address discrimination that has a secondary effect on the ability of individuals to participate meaningfully in and/or to receive health care from a covered health program in a nondiscriminatory manner. OCR did not, nor did it intend to, single out any religious teachings and will respect all guarantees of Federal religious freedom and conscience laws. Comment: Commenters highlighted that transgender and nonbinary people face unique discrimination in inpatient settings that are separated by sex, 158 U.S. Conference of Catholic Bishops, Ethical and Religious Directives for Catholic Health Care Services (6th ed. 2018), https://www.usccb.org/ resources/ethical-religious-directives-catholichealth-service-sixth-edition-2016-06_0.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 particularly those that have only male and female facilities available. These commenters noted that this results in nonbinary people not having access to facilities consistent with their gender identity. A few commenters raised concerns about the application of § 92.206(b)(3) to arrangements and practices involving patients who share intimate space with, or require intimate personal assistance from, other individuals. The commenters argued that the requirement to treat individuals consistent with their gender identity may raise concerns for privacy. Response: OCR appreciates the commenters’ feedback. As specified in the preamble discussion for § 92.101, this final rule protects all people regardless of gender identity, including transgender and nonbinary people. Nothing in this rule prohibits a covered entity from operating sex separated programs and facilities, so long as it does not subject anyone, including transgender and nonbinary individuals, to more than de minimis harm on the basis of sex. When a nonbinary individual seeks participation in a single-sex health program or activity or a health program or activity that maintains sex separate facilities, the covered entity should work with that individual to determine where they will best be served and where they can benefit the most from the health program or activity without experiencing trauma, distress, or threats to their safety due to an incorrect placement. A covered entity must not deny a nonbinary individual access to a health program or facility on the basis that the program or facility separates patients based on sex or offers separate male and female programs or facilities. Courts have held that all individuals’ safety and privacy can be protected without also excluding transgender individuals from accessing sex-separate facilities and activities consistent with their gender identity.159 Nothing in the rule prevents covered entities from implementing policies or procedures to preserve any patient’s privacy— consistent with the requirements of this rule and any other applicable laws. Providers have a range of tools at their disposal to accommodate individuals’ privacy concerns and patient interests 159 Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 613–15 (4th Cir. 2020); see also Cruzan v. Special Sch. Dist. # 1, 294 F.3d 981, 984 (8th Cir. 2002) (per curiam) (holding that transgender woman’s mere presence in a sex-separate space did not constitute actionable sexual harassment of her female co-workers); Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, 1052– 53 (7th Cir. 2017). PO 00000 Frm 00073 Fmt 4701 Sfmt 4700 37593 in a nondiscriminatory manner. For example, a provider generally may accommodate a patient’s preferences about roommate assignments. A covered entity will be in violation of this rule if they refuse to admit a transgender person for care or refuse to place them in facilities consistent with their gender identity, because doing so would result in more than de minimis harm. We also note that no application of this rule shall be required insofar as it would violate Federal religious freedom and conscience laws. Recipients may rely on those protections directly, see § 92.3(c), or they may seek an assurance of a religious freedom or conscience exemption, see § 92.302(b). Comment: A commenter opposed the rule on the grounds that it would violate the U.S. Constitution’s Equal Protection Clause standard for sex discrimination claims, which the commenter asserted allows men and women to be treated differently based on inherent differences in biology when such differences are real and not based on stereotypes. The commenter argued that proposed § 92.206(b)(3) would inappropriately prohibit providers from using any sexbased distinction unless they can prove it does not cause more than de minimis harm. This commenter alleged that the true purpose of such a provision is not equal treatment for all patients but special treatment for transgender individuals, particularly with respect to the use of sex-separate facilities. This commenter also argued that the provision would contradict the Voluntary Resolution Agreement the Department entered into with Michigan State University (MSU) under section 1557, which requires the presence of a chaperone—the sex of whom should be determined by the wishes and comfort of the patient—for all sensitive examinations.160 Response: Not all differential treatment on the basis of sex constitutes unlawful discrimination under section 1557, and the final rule does not prohibit all differential treatment.161 If a 160 See Voluntary Resolution Agreement between U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rights & The Bd. of Trs. of Mich. State Univ., dba Mich. State Univ. & MSU HealthTeam & MSU Health Care, Inc. (2019), https://www.hhs.gov/sites/ default/files/vra-between-msu-and-ocr.pdf. 161 Several courts have held that discrimination against transgender people constitutes sex discrimination under the Equal Protection Clause. See, e.g., Hecox v. Little, Nos. 20–35813, 20–35815, 2023 WL 5283127, at *12 (9th Cir. Aug. 17, 2023); Brandt v. Rutledge, 551 F. Supp. 3d 882, 889 (E.D. Ark. 2021), aff’d sub nom. Brandt ex rel. Brandt v. Rutledge, 47 F.4th 661, 670 (8th Cir. 2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 608 (4th Cir. 2020); Whitaker by Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, E:\FR\FM\06MYR4.SGM Continued 06MYR4 37594 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 sex-based distinction has only a de minimis impact, it is not prohibited discrimination.162 But treating individuals differently on the basis of sex constitutes sex discrimination where it imposes a more-than-de minimis level of harm. Under the rule, providers may use sex-based distinctions to administer individualized care, provided those distinctions do not cause more than de minimis harm. We disagree with the proposition that purpose of § 92.206(b)(3) is special treatment for transgender individuals, particularly with respect to the use of sex-specific facilities. The purpose of this section is to prevent unlawful discrimination on the basis of sex. The prevention of discrimination on the basis of gender identity is an important government objective that is substantially achieved by this rule. Further, the Voluntary Resolution Agreement entered into with MSU, provides that a patient may request a chaperone to be present at any time and that the patient’s ‘‘wishes and comfort should determine the sex of the chaperone.’’ 163 It further specifies that MSU ‘‘shall accommodate, to the extent practicable, the Patient’s request for a same-sex chaperone.’’ 164 The final rule does not prohibit patients from requesting or receiving a chaperone of the sex of their choosing. Finally, OCR disagrees with the commenter that the rule violates the Equal Protection Clause. OCR’s authority to promulgate this rule stems from a Federal non-discrimination statute, section 1557. This rule does not purport to interpret the Equal Protection Clause. Thus, even assuming the commenter is correct that the rule bans certain sex-based distinctions that would be permitted under the Equal Protection Clause, such a discrepancy would not mean the rule is unlawful. OCR may promulgate a rule that imposes different non-discrimination requirements on recipients of Federal funds than the non-discrimination 1048 (7th Cir. 2017), abrogated on other grounds as recognized by Ill. Republican Party v. Pritzker, 973 F.3d 760, 762 (7th Cir. 2020); Glenn v. Brumby, 663 F.3d 1312, 1316 (11th Cir. 2011); Smith v. City of Salem, 378 F.3d 566, 572, 577 (6th Cir. 2004); but see L. W. by & through Williams v. Skrmetti, 83 F.4th 460 (6th Cir. 2023). 162 See, e.g., Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75, 81 (1998) (title VII does not reach non-harmful ‘‘differences in the ways men and women routinely interact with’’ each other); see also Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 59–60 (2006) (‘‘No one doubts that the term ‘discriminate against’ refers to distinctions or differences in treatment that injure protected individuals.’’). 163 MSU Agreement at IV.D.1.v. 164 MSU Agreement at IV.D.1.vi. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 requirements the Equal Protection Clause imposes on the government.165 Comment: A health research organization expressed support regarding § 92.206(b)(3)’s discussion of the impact on health research and clinical trials. The commenter commended OCR on its guidance on sex-specific health research. This commenter stated that the standard for limiting research outlined by OCR in the 2022 NPRM was reasonable and health researchers will typically be able to demonstrate the requisite justification for a sex-specific research project or clinical trial based on research protocols. However, the commenter requested OCR provide similar guidance for the final rule on whether health research protocols that target or exclude individuals with disabilities would be considered discriminatory. Conversely, another organizational commenter disagreed with the statement on sex-specific clinical trials because the commenter believed it would pressure clinical researchers and organizations to disregard sex-based distinctions for fear of inviting a gender identity discrimination claim. The commenter claimed that the rule would contradict National Institutes of Health (NIH)’s expectation for clinical trials, which the commenter claimed required specifying the ‘‘biological sex’’ of subjects, by laying down an ‘‘unscientific marker’’ that sex-specific clinical trials can only be justified in limited circumstances.166 The commenter further argued that this would represent a backward step for women’s health, because the evaluation of diseases and treatments improved when researchers recognized that sex must be taken into account as a biological variable in medicine. Response: OCR appreciates these comments regarding the application of this provision to sex-specific health research and clinical trials and the standard proposed for evaluating claims of discrimination in such health programs and activities. We agree that researchers should not have challenges showing necessary justifications for nondiscriminatory research distinctions grounded in a participant’s 165 Cf. Fitzgerald v. Barnstable Sch. Comm., 555 U.S. 246, 257 (2009) (recognizing that the liability standards under title IX and the Equal Protection Clause ‘‘may not be wholly congruent’’). 166 The commenter does not provide a citation when making this statement; however earlier in their comment, the commenter cites a Notice from the National Institutes of Health (NIH): U.S. Dep’t of Health & Hum. Servs., Nat’l Inst. of Health, Consideration of Sex as a Biological Variable in NIH-funded Research, NOT–OD–15–102 (June 9, 2015), https://grants.nih.gov/grants/guide/noticefiles/not-od-15-102.html. PO 00000 Frm 00074 Fmt 4701 Sfmt 4700 reproductive, anatomical, and genetic characteristics. We disagree with the proposition that OCR is disregarding sex-based distinctions in medicine. Health research and clinical trial protocols are not prohibited from specifying an individual’s sex consistent with their reproductive, anatomical, and genetic characteristics, where those characteristics are relevant to the clinical trial. However, there are ways in which health research and protocols may result in discrimination, such as disallowing participation based on gender identity rather than on the basis of scientific requirement of the research. Should the need arise, OCR will consider issuing guidance on the impacts of disability protections on research participation. Comment: Several commenters supported the rule’s prohibition on sexspecific health programs or activities that subject any individual to more than de minimis harm. One supportive commenter argued that this approach recognizes harm as the primary measure of discrimination and creates flexibility to identify new forms of harm, and another argued the standard of no more than de minimis harm is consistent with applicable case law, including Bostock. A commenter expressed appreciation for the Proposed Rule’s detailed explanation of de minimis harm and the difference between clinical care for a patient. Conversely, another commenter stated the Proposed Rule ‘‘cherry picks’’ a title IX court decision to justify a standard of ‘‘more than de minimis harm’’ as the basis for ‘‘adjudicating gender identity,’’ arguing that title IX has never required sex to be recognized as anything but ‘‘objectively, biologically based.’’ Similarly, another commenter argued the rule applies beyond denial or limitations on health services. The commenter argued that the rule would prohibit health care professionals, medical facilities, and insurance companies from using any sex-based distinction unless they can prove it does not cause more than de minimis harm, and that if a provider asks the wrong question or asks an appropriate question in the wrong manner then the provider will likely face a claim of discrimination on the basis of gender identity. Response: OCR appreciates the range of comments provided on the proposed language regarding de minimis harm, and after careful review, OCR is finalizing the language as proposed. The rule does not prohibit all sex-based distinctions in health programs or activities, nor does it broadly prohibit any policy or practice of treating E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations individuals differently based on sex. As noted in the Proposed Rule, although intentional differential treatment on the basis of sex would generally be considered prohibited discrimination, separation by sex or differential treatment on the basis of sex is permissible under section 1557 where it does not cause more than de minimis harm. 87 FR 47866. This distinction generally allows for sex-specific clinical trials when sex is relevant to the trial, for example, while still prohibiting differential treatment that causes harm. Providers often need to make inquiries about a patient’s sex-related medical history, health status, or physical traits related to sex in the course of providing care and this rule does not prohibit or inhibit that. 87 FR 47867–68. Such inquiries are not per se discriminatory, even where they touch on intimate or sensitive matters. For example, it is not discriminatory for a provider treating a patient presenting with symptoms consistent with an ectopic pregnancy to inquire about the possibility that the patient could be pregnant, regardless of that patient’s gender identity. Similarly, when providing appropriate care to a patient, asking medically relevant questions about a patient’s anatomy or medical history in a way that causes inadvertent distress—on its own—would not violate section 1557. However, it is important to note that if such questions are not relevant to assessing the patient’s condition, or the patient has answered the questions and makes clear that further questions are unwelcome, the inquiries may rise to the level of harassment on the basis of sex. For example, if the conduct is so severe or pervasive that it denies a patient access to medical care, it would no longer be permissible. OCR will evaluate these types of harassment claims on a case-bycase basis to determine whether the alleged harassment was ‘‘sufficiently severe, pervasive, and objectively offensive,’’ to meet the standards for discriminatory harassment.167 In response to commenters that questioned the legal basis for our de minimis standard, we discussed in the 2022 NPRM, 87 FR 47866, n. 412, that sex-based distinctions that have only de minimis impact are not the type of discrimination that Congress envisioned.168 167 Cf. Davis by Next Friend LaShonda D. v. Monroe Cnty. Bd. of Educ., 526 U.S. 629, 650 (1999) (Under title IX, discriminatory harassment must be ‘‘severe, pervasive, and objectively offensive’’). 168 See also Elborough v. Evansville Cmty. Sch. Dist., 636 F. Supp. 2d 812, 820–21 (W.D. Wis. 2009) (noting that Title IX does not ‘‘authorize[ ]lawsuits for damages in all cases of differential treatment, no VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Comment: A commenter recommended that, based on existing racial disparities in maternal health and overall poor maternal health outcomes in the United States, § 92.206(b)(3) be amended to specify that harm exceeding the threshold of de minimis harm with respect to pregnancy and maternal health can include policies or practices that subject people to rough handling, harsh language, undertreatment of pain or pregnancy-related conditions, or other discriminatory mistreatment during childbirth or the prenatal or postpartum periods. Response: OCR recognizes that there is ample research demonstrating the significant racial disparities in maternal health outcomes.169 Section 92.206(b)(3) specifically addresses different treatment on the basis of sex, such as through sex-separate health programs and activities. Depending on the specific facts at issue, the treatment described by the commenter may rise to the level of discrimination and would be evaluated under this rule’s general prohibition of discrimination under § 92.101. Comment: An organizational commenter strongly supported the additional guidance provided by proposed §§ 92.206 and 92.207 and noted that the forms of discrimination highlighted in proposed §§ 92.206(b)(3) and (4) and 92.207(b)(3) through (5), in particular, affect many intersex people. Response: OCR appreciates the commenter’s feedback regarding the discrimination addressed in §§ 92.206(b)(3) and (4) and 92.207(b)(3) through (5) affecting intersex people as well. This final rule makes explicit in regulatory text that sex discrimination includes discrimination based on sex characteristics, including intersex traits, as reflected in § 92.101(a)(2). Comment: Many commenters expressed support for the proposed provisions related to gender-affirming care at § 92.206(b)(4). These commenters stated that such care can be critical to the well-being of transgender and nonbinary people, and that accessing such care can reduce the risk of negative physical and mental health outcomes matter how isolated or minimal. The maxim that ‘the law doesn’t concern itself with trifles’ applies to civil rights cases as it does to any other case.’’). 169 Donna L. Hoyert, U.S. Dep’t of Health & Hum. Servs., Ctrs. for Disease Control & Prevention, Maternal Mortality Rates in the United States (Feb. 2022), https://www.cdc.gov/nchs/data/hestat/ maternal-mortality/2020/E-stat-Maternal-MortalityRates-2022.pdf; Marian F. MacDorman et al., Racial and Ethnic Disparities in Maternal Mortality in the United States Using Enhanced Vital Records, 2016– 2017, 111 a.m. J. Pub. Health 1673, 1671 (2021), https://ajph.aphapublications.org/doi/10.2105/ AJPH.2021.306375. PO 00000 Frm 00075 Fmt 4701 Sfmt 4700 37595 associated with gender dysphoria. Commenters discussed the negative impact of widespread health care discrimination against transgender people, stating that transgender people of color and transgender people with disabilities are at particularly high risk of discrimination and associated harms. Response: OCR appreciates these comments and agrees that the nondiscrimination protections are important to transgender and nonbinary people’s ability to access clinically appropriate care, especially those who may face elevated risk of harm due to discrimination on multiple protected bases. In determining whether a covered entity violated section 1557 by denying or limiting a health service sought for the purpose of gender-affirming care, OCR will continue to consider evidence that the covered entity would provide that same service for other purposes. Evidence that OCR may consider to establish that the type of care is ordinarily provided could include, among other things, statements by the provider, information showing that the provider has provided similar care in the past, or documentation regarding the provider’s scope of practice. Where there is other evidence that the covered entity has subjected the individual to differential treatment on the basis of sex apart from the denial of care itself, OCR may investigate and make a case-by-case determination as to whether prohibited discrimination has occurred. Comment: A few commenters stated that OCR is explicitly asserting that it has authority under section 1557 to regulate the practice of medicine according to its own determination of what is appropriate and nondiscriminatory care, along with authority to definitively determine what is the current standard of medical care. Some commenters requested OCR amend the provision to specify that care standards cannot facially discriminate or otherwise result in discrimination based on a protected characteristic, such that covered entities cannot mask discrimination behind clinical policies or criteria. Response: Section 1557 prohibits discrimination on certain prohibited bases, and does not (and cannot) require a specific standard of care or course of treatment for any individual or otherwise interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37596 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a patient or that they are not qualified to provide. Section 92.206(c) is consistent with the general principle in nondiscrimination law that entities facing allegations of discrimination have the opportunity to articulate a legitimate, nondiscriminatory basis for their challenged action or practice but that such a basis may not be a pretext for discrimination. Comment: Some commenters expressed concern that OCR is setting standards of care for gender-affirming care in this rule, and that is outside the scope of OCR’s authority. Many commenters weighed in with their views on the state of medical evidence relating to gender-affirming care and submitted citations to research studies and other data. Some comments characterized the evidence as lacking or mixed, and highlighted their concerns relating to gender-affirming care for minors. Others stated that there is robust evidence, including from major medical associations, supporting the provision of gender-affirming care, including that such medically necessary care benefits the health and well-being of transgender patients. Response: This final rule prohibits discrimination on the basis of sex, consistent with Federal law. As such, nothing in this rule impedes covered entities from taking nondiscriminatory actions based on current medical standards and evidence, such as making decisions about the timing or type of protocols appropriate for care. The rule does not (and cannot) require a specific standard of care or course of treatment for any individual, minor or adult. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. Comment: A number of commenters had concerns or questions about the scope of how OCR would define genderaffirming care. Some commenters requested a definition or an enumeration of what types of procedures would fall within this term. Others raised concerns about the impact of such care and the benefits of such care. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: As with the 2016 Rule, 81 FR 31435, OCR declines to provide a regulatory definition for genderaffirming care. However, when we used the term ‘‘gender-affirming care’’ in both §§ 92.206 and 92.207, we are generally referring to care designed to treat gender dysphoria that may include, but is not necessarily limited to, counseling, hormone therapy, surgery, and other related services. 87 FR 47834 n.139. As noted elsewhere, the rule does not impose a categorical requirement that covered entities must provide genderaffirming care. Further, while we acknowledge comments in support of and opposed to gender affirming care and its subsequent impacts on individuals, we are not making any additional edits to the rule in response. Comment: Some commenters opposing the rule raised First Amendment concerns and questioned the scope of what would be required of providers in terms of expressing support of transgender people who wish to access gender-affirming care, using the name and pronouns requested by patients, and speaking about genderaffirming care. Response: OCR takes seriously concerns about, and is fully committed to upholding, the First Amendment, and nothing in these regulations restricts conduct protected by the First Amendment.170 Whether discrimination is unlawful or considered harassment is necessarily fact-specific. This final rule does not purport to identify all of the circumstances that could constitute unlawful harassment. It is unlikely that an isolated incident with no other indications of animus or ill treatment would meet the standards for discriminatory harassment. Conversely, OCR notes that conduct, including verbal harassment, that is so severe or pervasive that it creates a hostile environment on the basis of sex is a form of sex discrimination. Comment: A few commenters argued that providing gender-affirming care poses high malpractice lawsuit risks to providers, and therefore OCR should not categorically require providers to provide such services. Response: As discussed elsewhere in this preamble, this final rule prohibits discrimination in the provision of health programs and activities and does not require provision of any specific 170 See, e.g., W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624, 642 (1943) (‘‘We think the action of the local authorities in compelling the flag salute and pledge transcends constitutional limitations on their power and invades the sphere of intellect and spirit which it is the purpose of the First Amendment to our Constitution to reserve from all official control.’’). PO 00000 Frm 00076 Fmt 4701 Sfmt 4700 services, including gender-affirming care. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. Comment: One commenter expressed concern that the rule would result in decreased access to health care, as providers may choose to leave Federal health care programs based on a belief that they will be required to provide gender-affirming care, especially if there is no avenue for providers with religious or conscience objections to certain types of care to request exemptions. Response: Section 1557 requires that health care providers who receive Federal financial assistance must provide nondiscriminatory care. However, providers do not have an affirmative obligation to offer any health care, including gender-affirming care, that they do not think is clinically appropriate or if religious freedom and conscience protections apply. OCR believes that the majority of providers already provide nondiscriminatory care to their patients and will continue to do so. This commenter presented no evidence that a significant exodus of providers is likely, and we are not aware of any data to support a significant concern on this front. Providers with religious freedom or conscience concerns, however, may rely upon §§ 92.3 and 92.302. Comment: A few commenters expressed support for nondiscrimination protections that prohibited discriminating against an individual because of their gender identity but opposed interpreting such protections to protect access to genderaffirming care. Response: OCR appreciates these commenters’ support for the rule’s nondiscrimination protections on the basis of gender identity. We respectfully disagree, however, that such protections have no implications for the provision of gender-affirming care. A fact-specific analysis is necessary to determine whether prohibited discrimination has occurred, but the rejection of a practice closely linked with a protected status may, in conjunction with other evidence, lead to a finding of discrimination. This rule does not require or mandate the provision of any particular medical service. Section 1557 prohibits discrimination on certain prohibited bases, and does not interfere E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. Comment: An organizational commenter supported reference to the multi-factor test found in Arlington Heights v. Metro. Housing Dev. Corp., 429 U.S. 252 (1977), and the burdenshifting framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), among a non-exhaustive list of tools that OCR may utilize for investigating discrimination claims. The commenter asserted that sex discrimination claims are hard to prove, and that together these approaches are appropriate for their adjudication by allowing people to rely on different types of circumstantial evidence to collectively demonstrate a discriminatory act by a covered entity and by placing the onus on the covered entity to provide a legitimate, nondiscriminatory reason for its actions. Similarly, another commenter encouraged OCR to clearly state in the final rule that the familiar but-for causation test applies to establishing a violation of section 1557; that the use of the phrase ‘‘legitimate, nondiscriminatory reason’’ in these sections should not be construed in any way to limit the method of proof for any section 1557 claim to the McDonnell Douglas burden-shifting framework; and that this method cannot be used to defend an express sex-based classification that causes injury. Another commenter recommended that OCR clarify in the preamble to the final rule that the McDonnell Douglas burden-shifting framework and legitimate non-discriminatory reason framework apply to circumstantial evidence cases but not where there is direct evidence of discrimination. Response: OCR agrees that different methods of proof drawn from civil rights case law should be used in analyzing claims of discrimination under this section including, but not limited to, the Arlington Heights multifactor test and the McDonnell Douglas burden-shifting framework. For cases where the alleged discrimination is not based on a facially discriminatory policy, we are clarifying that the phrase ‘‘legitimate, nondiscriminatory reason’’ in these sections is taken from, but should not be construed to limit, the method of proof to the McDonnell Douglas burden-shifting framework. As we noted in the Proposed Rule, Arlington Heights provides a method of VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 proof that uses a number of different types of evidence—e.g., direct, circumstantial, statistical, and anecdotal—that, taken collectively, can demonstrate that the covered entity acted because of a protected basis; the McDonnell Douglas burden-shifting framework is an inferential method of proof most commonly applied in cases alleging discrimination in individual instances where a plaintiff alleges that a defendant treated similarly situated individuals differently because of a protected basis. 87 FR 47865. Under the Arlington Heights framework, McDonnell Douglas evidence identifying similarly situated comparators can also be considered but is not required.171 Comment: Many commenters supported the rule’s clarification that while providers may exercise clinical judgment when determining if a particular service is appropriate for an individual patient, they may not refuse gender-affirming care based on a belief that such care is never clinically appropriate. A great number of individuals and organizations provided comment on the types of rationales that might constitute a legitimate, nondiscriminatory basis for a provider declining to provide gender-affirming care. Some commenters opined that it should not be considered discriminatory to deny care when a provider categorically objects to gender-affirming care. Other commenters appreciated the clarification that a provider’s personal belief that gender-affirming care is never appropriate is not a legitimate, nondiscriminatory basis for denying such care. The majority of commenters opined that the rule provides adequate protection for providers exercising nondiscriminatory clinical judgment about the appropriateness of particular care for a specific patient, though some commenters disagreed. Response: OCR appreciates commenters’ views on proposed § 92.206(c). In light of comments received, we are modifying the language in this provision to provide additional specificity regarding how OCR will evaluate a covered entity’s proffered legitimate, nondiscriminatory reason for denying care. We also add a reference to § 92.302 to make clear that this provision does not limit a recipient’s 171 Pac. Shores Props., LLC v. Newport Beach, 730 F.3d 1142, 1158–59 (9th Cir. 2013) (noting that a plaintiff need not rely on the McDonnell-Douglas approach to intentional discrimination but may instead produce other circumstantial evidence of intentional discrimination using Arlington Heights, as McDonnell Douglas ‘‘is not a straightjacket requiring the plaintiff to demonstrate that such similarly situated entities exist’’). PO 00000 Frm 00077 Fmt 4701 Sfmt 4700 37597 ability to seek assurance of an exemption based on religious freedom or conscience laws. Also, we note that while many commenters specifically discuss providers’ personal beliefs, these changes clarify that the rule applies to covered entities rather than specific individuals. To provide additional specificity, we are striking the second sentence of § 92.206(c), which previously read, ‘‘[h]owever, a provider’s belief that gender transition or other genderaffirming care can never be beneficial for such individuals (or its compliance with a State or local law that reflects a similar judgment) is not a sufficient basis for a judgment that a health service is not clinically appropriate,’’ in its entirety and replacing it with: ‘‘A covered entity’s determination must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302.’’ Our reasons for this change are as follows: First, many commenters strongly urged OCR to consider that providers may have a nondiscriminatory reason to not provide some aspects of or all gender-affirming care. OCR understands that a provider may have a legitimate nondiscriminatory reason not to provide a health service, which the newly revised § 92.206(c) makes clear. While this section has application in the gender-affirming care context, the revised language is also intended to make clear that it is not limited to that context. When OCR investigates claims of discrimination based on the denial of care, OCR will consider the covered entity’s rationale for such denial, any supporting information the covered entity offers for its position, and any evidence of unlawful animus, bias, or other discriminatory factors in the case. Second, and as discussed, section 1557 prohibits discrimination on certain prohibited bases, and does not interfere with individualized clinical judgment about the appropriate course of care for a patient. OCR has a general practice of deferring to a clinician’s judgment about whether a particular service is medically appropriate for an individual, or whether the clinician has the appropriate expertise to provide care. There is no part of section 1557 that compels clinicians to provide a service that they do not believe is medically appropriate for a particular patient or that they are not qualified to provide. Since the rule does not (and cannot) set a standard of care for genderaffirming care, the focus of any investigation will not be to generally E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37598 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations review a covered entity’s clinical judgment but rather to determine whether the assertion of that judgment reflects unlawful animus or bias, or is a pretext for discrimination. Similarly, outside of the gender-affirming care context, OCR may find an invocation of clinical appropriateness to be pretextual if, for example, the evidence demonstrates that the covered entity asserted that pain medication was not clinically appropriate for a patient because of the belief that women exaggerate pain symptoms and inaccurately relay information about their symptoms. Third, because many commenters expressed concern about the relationship between § 92.206(c) and religious or moral beliefs concerning gender-affirming care, we added an explicit reference in § 92.206(c) to § 92.302. The new language clarifies that § 92.206(c) does not preclude the process set forth in § 92.302 where a recipient’s objection to gender-affirming care may be protected under religious freedom and conscience laws. Comment: Many commenters also cited religious or moral objections to gender-affirming care, urging that these should be considered a legitimate, nondiscriminatory reason to decline to provide such care. Response: OCR understands that recipients may have religious or conscience objections to the provision of certain types of care. Such an objection can serve as a legitimate, nondiscriminatory reason where it is neither pretextual nor discriminatory. If a provider typically declines to provide a particular health service to any individual based on a religious belief, regardless of individual’s sex assigned at birth or gender identity, the provider likely meets § 92.206(c)’s standard for a ‘‘legitimate, nondiscriminatory reason.’’ And where a provider’s religious belief causes the provider to treat individuals differently based on sex assigned at birth or gender identity, the provider may rely on the protections afforded by religious freedom and conscience laws or choose to seek assurance of those protections by making use of § 92.302(b)’s assurance of religious freedom and conscience exemption process, a feature that both the 2016 and 2020 Rules lacked. As discussed in more detail below, OCR is making several modifications to § 92.302 to strengthen and clarify this process. Comment: Many commenters supported the inclusion of § 92.206(c) but recommended that OCR strengthen the language pertaining to providers complying with a State or local law as a justification for denying gender- VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 affirming care, abortions, or other reproductive health care to clarify that as a Federal civil rights law, the rule preempts any such State or local law restricting access to such care. Some commenters suggested including language in the preamble to make clear that the majority of States’ policies that restrict transgender and nonbinary people’s access to health care would be barred. Another commenter expressed support for explicit preemption language, because otherwise providers would be forced to attempt to comply with State and local laws, while also trying not to run afoul of OCR’s case-bycase judgment concerning what conduct may be considered discriminatory. Some commenters expressed concern that the rule could deem physicians’ conduct discriminatory when declining to provide services because of State or local laws restricting those services, leaving them in an untenable position. Other commenters criticized the rule because they believe it preempts State laws restricting abortion and genderaffirming care and seeks to preempt State laws on religious freedom and conscience. A commenter expressed confusion as to how the rule would preempt State law as opposed to simply disallowing Federal funds from entities that do not comply. Response: OCR understands providers’ concerns that the provision’s reference regarding compliance with State or local law would place them in a difficult position with regard to the conflicting demands of this rule’s nondiscrimination requirements and various State and local laws restricting access to abortion or gender-affirming care. While we have removed the language from § 92.206(c) that many commenters supported, section 1557’s nondiscrimination requirements nevertheless generally preempt conflicting State law for the reasons stated earlier in this preamble. That said, in exercising and determining its enforcement priorities, OCR will consider the specific factual record of each complaint on a case-by-case basis. This may include, among other things, consideration of whether any covered entity that is taking discriminatory actions under the rule is doing so because it believes in good faith it is obligated to do so by State or local law, whether that covered entity demonstrated a willingness to refer or provide accurate information about gender-affirming care, or is otherwise engaging in good faith efforts to ensure patients are receiving medically necessary care. Comment: Several commenters expressed support for § 92.206(d)’s PO 00000 Frm 00078 Fmt 4701 Sfmt 4700 clarification that the enumeration of specific forms of prohibited discrimination in § 92.206(b) does not limit the general prohibition against discrimination in § 92.206(a), while recommending that additional preamble language be added to the final rule citing additional examples of discrimination and to provide confirmation that OCR’s investigations will not be limited by the enumerated examples in § 92.206(b). Response: We emphasize that § 92.206(b) is not an exhaustive list of all scenarios that would constitute of sex discrimination under the rule. We have provided additional examples of sex discrimination in this preamble, and OCR’s investigations will not be limited by the enumerated forms of discrimination addressed in § 92.206(b) or elsewhere. Comment: One commenter stated that OCR ignored Burwell v. Hobby Lobby, 573 U.S. 682 (2014), in the Proposed Rule and that the Proposed Rule is comparable to the Department’s actions in that case, in which the Court found that the government’s compelling interest in protecting women’s health could be accomplished in a less restrictive manner. Response: OCR has considered Hobby Lobby and will be mindful of it when carrying out enforcement of the final rule. For a further discussion of views regarding application of Federal conscience or religious freedom laws, refer to § 92.302. Summary of Regulatory Changes For the reasons set forth above and considering the comments received, we are finalizing the provision as proposed in § 92.206, with modifications. We have revised § 92.206(b)(1) to state: ‘‘Deny or limit health services, including those that have been typically or exclusively provided to, or associated with, individuals of one sex . . . .’’ We are revising § 92.206(c) to remove the sentence that reads: ‘‘However, a provider’s belief that gender transition or other gender-affirming care can never be beneficial for such individuals (or its compliance with a state or local law that reflects a similar judgment) is not a sufficient basis for a judgment that a health service is not clinically appropriate.’’ To the end of § 92.206(c) we are adding sentences that read: ‘‘A covered entity’s determination must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302.’’ E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 Nondiscrimination in Health Insurance Coverage and Other Health-Related Coverage (§ 92.207) In § 92.207, OCR proposed to prohibit discrimination on the basis of race, color, national origin, sex, age, or disability in the provision or administration of health insurance coverage and other health-related coverage. This proposed section would apply to all covered entities that provide or administer health insurance coverage or other health-related coverage that receive Federal financial assistance, and the Department in the administration of its health-related coverage programs. In § 92.207(a), OCR proposed a general nondiscrimination requirement, and § 92.207(b) proposed specific examples of prohibited actions. In § 92.207(b)(1), OCR specified that covered entities are prohibited from denying, cancelling, limiting, or refusing to issue or renew health insurance coverage or other healthrelated coverage, or denying or limiting coverage of a claim, or imposing additional cost sharing or other limitations or restrictions on coverage, on the basis of race, color, national origin, sex, age, or disability. In § 92.207(b)(2), OCR proposed prohibiting marketing practices or benefit designs that discriminate on the basis of race, color, national origin, sex, age, or disability. In § 92.207(b)(3), OCR proposed that it is prohibited discrimination to deny or limit coverage, deny or limit coverage of a claim, or impose additional cost sharing or other limitations or restrictions on coverage to an individual based upon the individual’s sex at birth, gender identity, or gender otherwise recorded. We invited comment on this provision, including whether it sufficiently addresses the challenges transgender and gender nonconforming individuals are experiencing when seeking access to medically necessary care due to a discordance between their sex assigned at birth and their sex as recorded by their issuer. In § 92.207(b)(4), OCR proposed to prohibit a covered entity from having or implementing a categorical coverage exclusion or limitation for all health services related to gender transition or other gender-affirming care.172 172 As noted in the discussion of § 92.206 above, this preamble uses the terms ‘‘gender transition’’ and ‘‘gender affirmation’’ interchangeably in discussing the range of care that transgender individuals (including those who identify using other terms, for example, nonbinary or gender nonconforming) may seek to treat gender dysphoria and support gender transition or affirmation. Because insurance coverage provisions and medical-necessity determinations more often use VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 In § 92.207(b)(5), OCR proposed to ensure that a covered entity does not impose discriminatory limits on coverage for specific health services related to gender transition or other gender-affirming care, which would generally be the case if such limits are not applied when those same health services are not related to gender transition or other gender-affirming care. In § 92.207(b)(6), OCR proposed an integration provision that prohibits covered entities from having or implementing a benefit design that does not provide or administer health insurance coverage or other healthrelated coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities. OCR sought comment on the scope and nature of the benefit design features that result in unjustified segregation or institutionalization of qualified individuals with disabilities or place such individuals at serious risk of institutionalization or segregation. We were interested in feedback on the application of the integration requirement to a wide variety of health services and were particularly interested in comments on the application of the integration requirement to coverage of post-acute services, mental health services, and other services commonly provided by non-State payers (i.e., health insurance issuers, self-insured group health plans, and other payers). OCR was also interested in feedback on the application of the integration requirement to the Medicaid program and its statutory framework at title XIX of the Social Security Act. Specifically, we requested input on how State Medicaid agencies are able to achieve compliance with the integration requirement through benefit design, such as through reimbursement, service scope, and service authorization that do not incentivize institutional services over community services. In addition, OCR requested input on the amount of time needed to reach compliance with needed benefit design modifications. In § 92.207(c), OCR stated that nothing in this section requires the coverage of any health service where the covered entity has a legitimate, nondiscriminatory reason for determining that such health service fails to meet applicable coverage the term gender transition, within these provisions, the term gender affirmation encompasses gender transition, that is the terminology used in the text of the regulation. The use of the term ‘‘gender transition’’ in the regulation, however, is not intended to convey a narrower meaning than the term ‘‘gender affirmation.’’ PO 00000 Frm 00079 Fmt 4701 Sfmt 4700 37599 requirements, such as medical necessity requirements, in an individual case. Finally, in § 92.207(d), OCR made clear that the enumeration of specific forms of discrimination in § 92.207(b) does not limit the general applicability of the prohibition in § 92.207(a). OCR generally invited comment on how section 1557 might apply to: provider networks; how provider networks are developed, including factors that are considered in the creation of the network and steps taken to ensure that an adequate number of providers and facilities that treat a variety of health conditions are included in the network; the ways in which provider networks limit or deny access to care for individuals on the basis of race, color, national origin, sex, age, or disability; and the extent to which the lack of availability of accessible medical diagnostic equipment in a provider network limits or denies access to care for individuals with disabilities. We also sought comment on the extent, scope and nature of value assessment methods that discriminate on the basis of race, color, national origin, sex, age, or disability. We were interested in feedback on the civil rights implications of value assessment across a wide variety of contexts, including utilization management, formulary design, price negotiations, alternative payment models and other relevant applications. Finally, OCR invited comment on all aspects of this section. In particular, we sought comment on the anticipated impact of the proposed application to excepted benefits and short-term, limited duration insurance (STLDI) when such products are offered by a covered entity; how the Proposed Rule’s nondiscrimination requirements would impact the industry that offers excepted benefits and STLDI and the consumers who rely upon those products; the prevalence of excepted benefits and STLDI offered by covered entities and the standard industry practices under which such plans are designed and administered; and excepted benefits and STLDI plans’ scope of coverage, types of exclusions and limitations, underwriting practices, premium setting, and actuarial or business justifications for industry practices (as applicable), that may raise concerns about discrimination under section 1557. The comments and our responses regarding § 92.207 are set forth below. For ease of reference, OCR may simply refer to ‘‘health insurance issuers’’ or ‘‘issuers’’ throughout the preamble, but other covered entities may also be subject to the section under E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37600 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations discussion. In addition, for purposes of this preamble only, OCR uses the term ‘‘health plan’’ or ‘‘plan’’ interchangeably to refer generally to health insurance coverage and other health-related coverage that is subject to this rule. As used in this preamble, ‘‘health plan’’ or ‘‘plan’’ may include health insurance coverage or other health-related coverage offered in the group and individual markets, group health plan coverage, Medicare Advantage plans, Medicare Part D plans, and Medicaid programs that are subject to this rule. OCR does not intend ‘‘health plan’’ or ‘‘plan’’ to be regulatory terms in this regulation or to replace any existing or proposed term in Federal law. OCR notes that a variety of entities may be considered covered entities subject to § 92.207, including but not limited to health insurance issuers, group health plans, Medicare Advantage Organizations, Medicare Part D plan sponsors, Medicaid managed care plans, pharmacy benefit managers, third party administrators (as part of a covered entity’s operations when it meets the criteria in paragraph (2) of the definition of ‘‘health program or activity’’ under § 92.4), and the Department. Comment: Commenters strongly supported the inclusion of an explicit provision related to prohibited discrimination in health insurance coverage and other health-related coverage, noting that it will help provide clarity for covered entities. Many commenters stated that it is clear from the statutory text of the ACA that Congress intended for section 1557 to apply to health insurance. Commenters stated that the 2020 Rule’s rescission of similar protections created confusion, was contrary to the intent and purpose of the ACA, and increased the burden on States to monitor and enforce nondiscrimination laws. Commenters noted that ensuring covered entities provide health insurance coverage and other health-related coverage in a nondiscriminatory manner will reduce adverse health outcomes and address some of the barriers vulnerable communities face in accessing health insurance coverage and other healthrelated coverage. Commenters from the health insurance industry were generally supportive of reinstating the section with some suggested modifications. This includes one commenter noting that, as an employer, they appreciated the Proposed Rule’s clarification prohibiting categorical exclusions, noting that the 2016 Rule’s similar prohibition had allowed them to negotiate a nondiscriminatory plan to cover their employees. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 One organizational commenter opposed to the inclusion of § 92.207 argued that health insurance issuers could face substantial costs, including compliance costs and claims costs, as a result of having to alter their coverages and business practices, which would result in higher premiums. This commenter also argued OCR is engaging in expansive and detailed regulation of numerous issuer business decisions in an arbitrary and capricious manner that could result in issuers facing heightened business risks and increased liability exposure. Response: OCR agrees that section 1557 applies broadly, including to prohibit discrimination by covered entities that provide or administer health insurance coverage and other health-related coverage. As discussed throughout this preamble, particularly under the discussion of the definition of ‘‘health program or activity’’ under § 92.4, the ACA is clearly intended to apply to health insurance coverage and other health-related coverage and prohibit the discriminatory practices therein. OCR disagrees that § 92.207 imposes expansive regulation of health insurance issuers and their business decisions in an arbitrary and capricious manner. The plain text of section 1557 applies to health insurance coverage and other health-related coverage; OCR is implementing Congressional intent to prohibit discrimination in health insurance coverage and other healthrelated coverage in § 92.207. In addition to section 1557, health insurance issuers are required to comply with myriad State and Federal laws regulating the practice of health insurance coverage and other health-related coverage. These laws include other Federal laws that regulate health insurance coverage and other health-related coverage practices, including nondiscrimination requirements.173 Compliance with legal requirements, such as section 1557, is a standard business practice as a health insurance issuer. Further, health insurance issuers were subject to former § 92.207’s requirements174 from either July 18, 2016, or January 1, 2017 (if plan design changes were required as a result 173 See, e.g., 42 CFR 422.100(f)(2) and (3), 422.110 (Medicare Advantage), 423.104(d)(2)(iii), 423.2262(a)(1)(iv) (Part D), 438.3(d) and (f) (Medicaid managed care), and 600.405(d) (Basic Health Program); 45 CFR 147.104(e) (group and individual health insurance markets), 156.125(a) and (b) (EHB), 156.200(e), and 156.225(b) (qualified health plans). 174 Issuers were subject to those requirements except for provisions either enjoined or vacated through lawsuits. See, e.g., Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016). PO 00000 Frm 00080 Fmt 4701 Sfmt 4700 of the 2016 Rule), through August 18, 2020, the effective date of the 2020 Rule. Comment: Some commenters supported § 92.207(b)(1), related to coverage denials and limitations. Some commenters asked OCR to state that cost sharing must not be used by covered entities in a discriminatory manner. Commenters acknowledged that cost sharing can be an effective tool, but they also expressed concern that insurance companies and pharmacy benefit managers are increasingly employing high cost sharing that disproportionately affects people with disabilities, chronic conditions, and other significant health needs. Commenters cited several studies that show patients who are uncertain about their ability to afford their out-of-pocket care expenses delay or forgo care or fall out of compliance with recommended follow-up steps.175 Commenters noted that such gaps in care can have deadly consequences for individuals with certain conditions, such as people living with HIV/AIDS. Commenters also provided examples of concerns related to cost sharing and patient financial assistance. A few commenters raised concerns about treatment of patient financial assistance, accumulator adjustment programs, copay maximizers, and alternative funding programs. Other commenters raised concerns about issuers designating drugs as ‘‘non-essentialhealth-benefits’’ to avoid certain 175 See, e.g., Joel F. Farley, Medicaid Prescription Cost Containment and Schizophrenia, 48 Med. Care 5, 440–47 (2010), https://pubmed.ncbi.nlm.nih.gov/ 20351586/; Teresa B. Gibson & Ronald J. Ozminkowski, The Effects of Prescription Drug Cost Sharing: A Review of the Evidence, 11 a.m.. J. Managed Care 11, 730–40 (2005), https:// pubmed.ncbi.nlm.nih.gov/16268755/; Daniel M. Hartung et al., Impact of a Medicaid Copayment Policy on Prescription Drug and Health Services Utilization in a Fee-for-Service Medicaid Population, 46 Med. Care 6, 565–72 (2008), https:// pubmed.ncbi.nlm.nih.gov/18520310/; Nantana Kaisaeng et al., Out-of-Pocket Costs and Oral Cancer Medication Discontinuation in the Elderly, 20 J. Managed Care Pharmacy 7, 669–75 (2014), https://pubmed.ncbi.nlm.nih.gov/24967520/; Deliana Kostova & Jared Fox, Chronic Health Outcomes and Prescription Drug Copayments in Medicaid, 55 Med. Care 5, 520–27 (2017), https:// pubmed.ncbi.nlm.nih.gov/28234755/; Sujha Subramanian, Impact of Medicaid Copayments on Patients With Cancer, 49 Med. Care 9, 842–47 (2011), https://pubmed.ncbi.nlm.nih.gov/21577164/ ; Samantha Artiga et al., The Effects of Premium and Cost-Sharing on Low-Income Populations: Updated Review of Research Findings, Kaiser Family Found., pp.1–5 (2017), https://www.kff.org/ medicaid/issue-brief/the-effects-of-premiums-andcost-sharing-on-low-income-populations-updatedreview-of-research-findings/; David B. Ridley & Kirsten J. Axelsen, Impact of Medicaid Preferred Drug Lists on Therapeutic Adherence, 24 Pharmacoeconomics Suppl. 3, 65–78 (2006), https:// www.ncbi.nlm.nih.gov/pubmed/17266389. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations essential health benefits (EHB) requirements.176 One organizational commenter expressed concerns about § 92.207(b)(1) and argued that this provision would impose new nondiscrimination tests on issuer business decisions that result in the denial or limitation of payment for a claim, on variations in cost sharing under the terms of a health plan, or on the imposition of other limitations or restrictions on coverage. The commenter argued this would result in expansive and detailed regulation of numerous issuer business decisions in an arbitrary and capricious manner. Response: OCR appreciates commenters’ concerns regarding cost sharing, which is explicitly addressed in § 92.207(b)(1). Covered entities are prohibited from ‘‘impos[ing] additional cost sharing or other limitations or restrictions on coverage, on the basis of race, color, national origin, sex, age, or disability.’’ We disagree with the commenter’s concerns that this provision arbitrarily or capriciously imposes new nondiscrimination tests on issuer business decisions. Covered entities subject to this rule are prohibited from engaging in unlawful discrimination in their health programs or activities, including in health insurance coverage or other healthrelated coverage. Cost sharing is standard industry practice that is a feature of an issuer’s health insurance coverage or other health-related coverage. Nothing in this rule dictates the business decisions an issuer should make in establishing its coverage limitations, including with regard to cost sharing. To the extent an issuer imposes cost sharing in its coverage, it cannot do so in a discriminatory manner. Comments related to violations of EHB requirements are outside the scope of this regulation.177 Comment: Commenters generally supported the prohibition on discriminatory marketing practices in § 92.207(b)(2). Commenters discussed that covered entities might use marketing practices to dissuade enrollment by individuals with highcost conditions. For example, commenters noted that plans present inaccurate or confusing information about formularies and hide or fail to provide information about certain drugs. Several commenters referenced a 2022 study by the AIDS Institute that found 57.9 percent of the 299 Exchange plan documents reviewed did not list PrEP 176 See section 1302 of the ACA, codified at 42 U.S.C. 18022. 177 See 42 U.S.C. 18022, 300gg–6(a); 45 CFR 156.100 through 165.155. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 (pre-exposure prophylaxis to prevent HIV infection) as a free preventive service, though health insurance issuers were required to include such coverage for all plans offered through the Exchanges in 2022.178 Commenters asked OCR to provide an example of discriminatory marketing practices in regulatory text. They further requested that OCR coordinate the study of marketing practices with other regulatory agencies. Response: OCR concurs with the importance of ensuring that an issuer’s marketing practices are not designed or implemented in a way that discriminates against individuals with a specific disability or on any other basis prohibited under section 1557. Inaccuracies or omissions in plan marketing materials may impede an individual’s ability to determine what treatments and services are covered. While certain inaccuracies or omissions in marketing materials may not be prohibited discrimination under this section, inaccuracies or omissions that were intended to or resulted in discouraging individuals from enrolling in health insurance coverage and other health-related coverage or steering individuals away from enrolling in health insurance coverage and other health-related coverage on the basis of disability or other prohibited basis would raise concerns of prohibited discrimination. The determination of whether a particular marketing practice is prohibited under this section requires a case-by-case analysis dependent on the facts of the challenged marketing practice. Accordingly, OCR declines to specify particular examples in the regulation, though we included an example in the Proposed Rule, stating that covered entities that avoid advertising in areas populated by a majority of people of color to reduce the enrollment of people of color in their health insurance coverage could violate § 92.207. 87 FR 47869–70. We note that covered entities may be subject to other Departmental and Federal regulations governing marketing practices.179 While 178 Letter from The AIDS Institute to Dr. Ellen Montz, Deputy Admin’r & Dir. (June 9, 2022), https://www.theaidsinstitute.org/letters/ marketplace-insurance-plan-prep-compliance. In general, under section 2713 of the PHS Act and its implementing regulations, plans and issuers must provide coverage, without cost sharing, for recommended preventive services for plan years (in the individual market, policy years) that begin on or after the date that is 1 year after the date the recommendation or guideline is issued. 26 CFR 54.9815–2713(b); 29 CFR 2590.715–2713(b); 45 CFR 147.130(b). 179 See, e.g., 45 CFR 147.104(e) (health insurance issuers offering coverage in the individual and group markets) and 156.225(b) (qualified health PO 00000 Frm 00081 Fmt 4701 Sfmt 4700 37601 OCR declines to coordinate a study of marketing practices, we continue to coordinate with other regulatory agencies on health insurance-related matters. We note that individuals with LEP or disabilities may face challenges in accessing a covered entity’s marketing materials. This final rule addresses such concerns in multiple ways, including by requiring covered entities to provide a Notice of Nondiscrimination under § 92.10; a Notice of Availability under § 92.11 (including in member handbooks at § 92.11(c)(5)(x)); taking reasonable steps to provide meaningful access to individuals with LEP under § 92.201; and taking appropriate steps to ensure effective communication for individuals with disabilities under § 92.202. Comment: Numerous commenters supported the prohibition on discriminatory health plan benefit designs in § 92.207(b)(2). Commenters stated that covered entities employ many features of benefit design and delivery to deny coverage or discourage people with significant or high-cost health needs from enrolling in their plans. These include exclusions, cost sharing, formularies, visit limits, provider networks, service areas, benefit substitutions, prior authorization, and other utilization management that the commenters allege are arbitrary and not clinically based or appropriate. Some commenters requested that OCR define the term ‘‘benefit design’’ or include specific examples of benefit design features in the regulatory text of § 92.207(b)(2). While some commenters expressed concern that failing to define benefit design in the regulation would result in a lack of clarity as to what the rule prohibits, other commenters supported OCR’s proposed approach to avoid defining the term in a prescriptive manner. One organizational commenter opposed § 92.207(b)(2) as imposing nondiscrimination tests on insurance benefit design, which the commenter argued would result in expansive and detailed regulation of a number of issuer business decisions in an arbitrary and capricious manner. Response: Benefit design features may result in a discriminatory denial of access to medically necessary care, particularly for individuals with disabilities who have significant health needs. To address this concern, covered entities are explicitly prohibited from having or implementing benefit designs plans); 42 CFR 423.2263 (Medicare Part D marketing requirements). E:\FR\FM\06MYR4.SGM 06MYR4 37602 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations that discriminate on any protected basis as set forth under § 92.207(b)(2). We decline to define ‘‘benefit design’’ or specify types of benefit design features in the regulatory text. Section 92.207(b)(2) sufficiently notifies covered entities that discriminatory benefit designs are prohibited under this rule. In addition, we seek to avoid being overly prescriptive or unintentionally inconsistent with other Departmental regulations that may define benefit design.180 While OCR declines to provide examples of specific benefit design features in the regulatory text, for purposes of applying section 1557 and this final rule, examples of benefit design features include, but are not limited to, coverage, exclusions, and limitations of benefits; prescription drug formularies; cost sharing (including copays, coinsurance, and deductibles); utilization management techniques (such as step therapy and prior authorization); medical management standards (including medical necessity standards); provider network design; and reimbursement rates to providers and standards for provider admission to participate in a network. OCR disagrees with the organizational commenter’s concern that this provision arbitrarily or capriciously imposes new nondiscrimination tests on issuer business decisions. This section does not dictate what business decisions an issuer must make in establishing its benefit design and does not specify any particular design feature must be included. OCR acknowledges that issuers have discretion in designing their plans; however, they must do so in a nondiscriminatory manner as discussed throughout this section. Comment: Commenters requested that OCR provide a non-exhaustive list of presumptively discriminatory benefit design examples. Some commenters also suggested that OCR incorporate the presumptively discriminatory benefit design examples provided in CMS’ EHB regulations 181 or otherwise rely on other nondiscrimination provisions in ddrumheller on DSK120RN23PROD with RULES4 180 Other Departmental and Federal regulations governing private health insurance and public health coverage refer to ‘‘benefit design’’ and ‘‘marketing practices.’’ See, e.g., 45 CFR 147.104(e), 156.20, 156.125(a) (health insurance issuers offering coverage in the individual and group markets), 156.200(b)(3), 156.225(b) (qualified health plans), 156.110(d), and 156.111(b)(2)(v) (EHB benchmark plans); 42 CFR 422.100(f)(3) (Medicare Advantage), 423.2263 (Medicare Part D marketing requirements), 423.882, 423.894(d) (Medicare retiree prescription drug plans), 440.347(e) (Medicaid benchmark plans), and 600.405(d) (Basic Health Program); 29 CFR 2510.3–40(c)(1)(iv)(A) (multiple employer welfare arrangements under ERISA). 181 See Patient Protection and Affordable Care Act; HHS Notice of Benefit & Payment Parameters for 2023, 87 FR 27208, 27301–02 (May 6, 2022). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 CMS regulations implementing the ACA. Commenters stated that allowing plan discretion on every benefit other than gender dysphoria undercuts the regulation. Many commenters stated that OCR should recognize that most benefit design elements are inherently discriminatory as they apply disproportionately to individuals with disabilities and chronic conditions. Commenters expressed concerns that without presumptively discriminatory benefit design examples, issuers will adopt designs that exclude or make lifesaving treatments unaffordable for individuals in protected categories. Commenters noted that such designs include cost-sharing requirements, restrictive medical necessity standards, narrow networks, drug formularies, adverse tiering, benefit substitution, utilization managements, exclusions, visit limits, quantity limits, waiting periods, service areas, and coercive wellness programs. Response: OCR declines to provide specific examples of presumptively discriminatory benefit designs in the rule due to the fact-intensive analysis needed to determine whether a particular benefit design feature is discriminatory under this section. We also decline to give examples of presumptively discriminatory benefit designs similar to those in EHB regulations applicable to nongrandfathered health insurance coverage in the individual and small group markets that CMS finalized in the preamble of its Notice of Benefit and Payment Parameters for 2023 final rule.182 Essential health benefits are governed by CMS regulations and not by this final rule. While many of the practices cited by CMS would raise concerns of prohibited discrimination under this rule, OCR’s determinations that a particular benefit design is discriminatory will be a fact-specific inquiry that OCR will conduct on a case-by-case basis. OCR’s process for analyzing claims of discrimination in 182 Patient Protection and Affordable Care Act; HHS Notice of Benefit & Payment Parameters for 2023, 87 FR 27208, 27301–05 (May 6, 2022) (providing the following examples of presumptively discriminatory benefit designs under CMS’ EHB nondiscrimination regulations applicable to nongrandfathered health insurance coverage in the individual and small group markets: (1) limitation on hearing aid coverage based on age; (2) autism spectrum disorder coverage limitations based on age; (3) age limits for infertility treatment coverage when treatment is clinically effective for the age group; (4) limitation on foot care coverage based on diagnosis (whether diabetes or another underlying medical condition); and (5) access to prescription drugs for chronic health conditions (adverse tiering)). We note these regulations are enforced by CMS and are distinct from section 1557 and other civil rights laws enforced by OCR. PO 00000 Frm 00082 Fmt 4701 Sfmt 4700 benefit design is discussed in more detail under the Benefit Design Analysis discussion later in this section. OCR will consider issuing guidance on discriminatory practices prohibited under this section in future guidance. OCR disagrees that the prohibition against categorical exclusions or limitations of coverage for all health services related to gender transition or other gender-affirming care under § 92.207(b)(4) undercuts the regulation. Such explicit, categorical exclusions or limitations impermissibly single out an entire category of services based on an individual’s transgender status and are presumptively discriminatory on the basis of sex as prohibited under this section. As discussed in detail under § 92.206, this rule includes specific provisions related to gender-affirming care given the widespread discriminatory denial of care for such services and its direct connection to an individual’s transgender status.183 As discussed in more detail below, covered entities may raise a defense under § 92.207(c) where they contend that they have a legitimate, nondiscriminatory basis for a coverage limitation that may otherwise appear to constitute discrimination. Recipients may also rely upon §§ 92.3 and 92.302(a) or request an assurance of exemption under § 92.302(b) based on their view that religious freedom or conscience protections apply. We also decline to incorporate examples of presumptively discriminatory benefit designs similar to those in EHB regulations applicable to non-grandfathered health insurance coverage 184 in the individual and small group markets that CMS finalized in the preamble of its Notice of Benefit and Payment Parameters for 2023 final rule. Essential health benefits are governed by CMS regulations and are not addressed by this final rule. While many of the practices cited by CMS would raise concerns of prohibited 183 See, e.g., Bos. All. of Gay, Lesbian, Bisexual & Transgender Youth v. U.S. Dep’t of Health & Hum. Servs., 557 F. Supp. 224, 239 (D. Mass. 2021) (‘‘[p]laintiffs have shown a substantial risk that insurers will deny reimbursement for treatment they previously covered based on the elimination of the prohibition on categorical coverage exclusions. Out2Enroll’s analysis indicates that ‘‘the number of insurers using transgender-specific exclusions . . . more than doubled’’ after HHS promulgated the 2020 Rule.’’). 184 In general, health coverage is considered grandfathered if it was in existence and has continuously provided coverage for someone (not necessarily the same person, but at all times at least one person) since March 23, 2010, provided the plan (or its sponsor) or the issuer has not taken certain actions resulting in the plan relinquishing grandfathered status, as more fully described at 26 CFR 54.9815–1251, 29 CFR 2590.715–1251, and 45 CFR 147.140. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 discrimination under this rule, OCR’s determinations that a particular benefit design is discriminatory will be a factspecific inquiry that OCR will conduct on a case-by-case basis. OCR’s process for analyzing claims of discrimination in benefit design is discussed in more detail under the Benefit Design Analysis discussion later in this section. OCR will consider issuing guidance on discriminatory practices prohibited under this section in future guidance. Comment: Commenters asked OCR to include examples of discriminatory benefit design specifically related to prescription drug formularies. These commenters provided examples of practices they considered to be discriminatory, such as issuers placing most or all drugs used in the treatment of certain conditions into the highest cost sharing tier; excluding single tablet regimens even when they are the standard of care for a condition; requiring the use of specialty pharmacy programs that require mail delivery even when that adds unnecessary and burdensome administrative barriers and delays to obtaining drugs; and using quantity limits for an entire class of medications without scientific or clinical explanation. Commenters expressed concerns that discriminatory prescription drug formularies discourage enrollment among certain populations, including individuals with HIV, mental health needs, or other chronic conditions. Commenters noted that enrollees who need high-cost medications often must choose between plans that will provide adequate coverage of their medication or plans that cover their preferred providers. A commenter cited a study that showed that Black and Hispanic/Latino people are more likely to abandon medications at the pharmacy because of high cost.185 Finally, some commenters recommended that OCR develop specific mechanisms to monitor prescription drug formulary practices and coverage of physician-administered ‘‘medical benefit’’ drugs to ensure that formularies are not used to discriminate against patients with specific disabilities. Response: Benefit design practices related to prescription drugs have an enormous impact on individuals’ access 185 PhRMA, Patient Experience Survey: Barriers to Health Care Access in the Patient Experience, pp. 10–11 (2021), https://phrma.org/-/media/Project/ PhRMA/PhRMA-Org/PhRMA-Org/PDF/P-R/PESReport_100621_Final.pdf (stating that utilization management disproportionately impacts people of color (Black Americans (56 percent) and Hispanic Americans (60 percent) versus white Americans (36 percent)) and that barriers imposed by utilization management can contribute to poor medication adherence or prescription abandonment). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 to medically necessary medication. Coverage of prescription drugs could pose concerns of prohibited discrimination and OCR would investigate such practices under the rule on a case-by-case basis. OCR declines to state that specific practices are per se discriminatory under the rule because each investigation is a fact-specific inquiry, based on nondiscrimination principles and relevant case law,186 including consideration of the covered entity’s reason for the design feature in question. As discussed in the Proposed Rule, several benefit design practices related to drug formularies could be discriminatory under this section, including prescription drug formularies that place utilization management controls on most or all drugs that treat a particular condition regardless of their costs without placing similar utilization management controls on most or all drugs used to treat other conditions, and benefit designs that place utilization management controls on most or all services that treat a particular disease or condition but not others. 87 FR 47874. OCR notes that coverage of physicianadministered ‘‘medical benefit’’ drugs would be considered part of a plan’s benefit design and therefore subject to this rule. While we identify some prescription drug practices above that may raise concerns under section 1557, this rule does not prohibit covered entities from engaging in nondiscriminatory practices related to prescription drug benefit design. For example, covered entities may utilize preferred drug lists, such as preferred drug lists under the Medicaid program under title XIX of the Social Security Act, as long as the coverage criteria does not constitute prohibited discrimination. In addition, as discussed in more detail below, covered entities are not prohibited from applying nondiscriminatory utilization management techniques in their drug formularies. Comment: Many commenters expressed concerns about benefit designs that impose coverage limitations or exclusions related to health services that could result in discrimination on the basis of disability. For example, some commenters argued that plans should not be permitted to have blanket exclusions for services related to ASD or applied behavioral analysis (ABA) therapy, a therapeutic intervention 186 See, e.g., Doe v. CVS Pharmacy, Inc., 982 F.3d 1204, 1212 (9th Cir. 2020); Doe v. BlueCross BlueShield of Tenn., 926 F.3d 235, 241 (6th Cir. 2019). PO 00000 Frm 00083 Fmt 4701 Sfmt 4700 37603 sometimes recommended for autistic children. Several commenters raised concerns about how frequently insurance benefit design practices inappropriately limit coverage of durable medical equipment. Commenters noted that issuers place unique annual coverage caps on items such as wheelchairs, ventilators, and hearing aids. A commenter noted an example of an individual with hearing loss that requires treatment other than cochlear implants being denied coverage of hearing aids and outpatient visits to an audiologist due to their issuer’s blanket exclusion of programs or treatments for hearing loss other than cochlear implants. Another commenter noted that issuers limit coverage of multiple-use speech-generating devices, which are most useful and effective for autistic individuals, even when those devices are less expensive than singleuse speech generating devices. Other commenters expressed concerns that covered entities include clinically inappropriate limits on the coverage of habilitative and rehabilitative services and devices. Commenters noted that such limitations, including on the number of covered visits, discriminate against people with more significant disabilities who need extensive habilitation or rehabilitation in order to gain, regain, or maintain functioning. Commenters requested that OCR clarify that blanket limitations or exclusions of habilitative services for individuals with specific disabilities are prohibited discrimination under section 1557 when those same services are allowed for rehabilitation of nondisabled persons. Commenters noted that people with developmental disabilities are routinely denied coverage for habilitative services needed to gain skills or improve functioning while an identical service is covered for individuals who require it for rehabilitative care to restore functioning. For example, a commenter noted that coverage of ‘‘speech therapy to restore speech’’ results in excluding all children with developmental delays who need the therapy to attain speech. Commenters noted that habilitative services are important for children who are delayed in walking or talking or need to learn other muscular skills for the first time and for individuals with disabilities to be able to live as independently as possible. Response: OCR appreciates the variety of concerns raised by commenters. A coverage limitation or exclusion that is based on a specific disability or condition (or other basis prohibited by section 1557, such as age, discussed below), would be investigated as E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37604 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations potentially discriminatory under this rule. Blanket exclusions of all treatments related to a particular condition, such as ASD or hearing loss, would raise significant concerns of prohibited discrimination on the basis of disability such that OCR would expect the covered entity to provide a legitimate, nondiscriminatory reason for the exclusion. Non-categorical exclusions or limitations for certain treatments related to a specific disability or condition may also raise concerns under the rule. This rule, however, does not require covered entities to cover all services related to a specific disability or condition. Application of standard disability discrimination principles requires a specific analysis of each claimed exclusion. We therefore decline to expressly state that a particular coverage exclusion or limitation is per se discriminatory on the basis of disability under this rule. Determinations of whether a particular coverage exclusion or limitation is discriminatory will be evaluated on a case-by-case basis, in accordance with longstanding civil rights principles and relevant case law, as discussed throughout this section. When investigating a potentially discriminatory exclusion or limitation, OCR will consider whether the covered entity has a legitimate, nondiscriminatory reason for the challenged design feature. If OCR determines that the covered entity’s reason is a legitimate, nondiscriminatory reason that is not a pretext for discrimination, OCR will conclude that the challenged exclusion or limitation is not prohibited under the rule. Regarding durable medical treatment, the commenters’ example of exclusions of coverage for programs or treatments for hearing loss other than cochlear implants has been the subject of at least two court cases where the courts have held that such exclusions do not state a claim for proxy disability discrimination under section 1557.187 We also note that health insurance issuers may be subject to other Departmental authorities that are relevant to issues raised by commenters.188 For example, to the extent durable medical equipment is an EHB, like hearing aids are in some states, covered entities may also be subject to CMS’ EHB nondiscrimination 187 Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 945, 960 (9th Cir. 2020); E.S. v. Regence BlueShield, No. 2:17–cv–01609–RAJ, 2022 WL 279028, at *8–9 (W.D. Wash., Jan. 31, 2022). 188 See, e.g., Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 regulations at 45 CFR 156.125 applicable to non-grandfathered health insurance coverage in the individual and small group markets.189 Further, CMS’ EHB regulations require coverage of habilitative services and devices, and specify that plans may not impose limits on coverage of habilitative services and devices that are less favorable than limits imposed on coverage of rehabilitative services and devices.190 Comment: Many commenters raised concerns related to mental health services. Commenters asked OCR to require both public and private payers to remedy the current inadequacies and inequities in mental health service reimbursement rates and policies, explaining that reimbursement rates have been historically lower for mental health services than physical health services. Commenters also identified a range of specific mental health benefit design inequities, including the need for intermediate-care facility coverage for high-use patients with non-urgent care needs to mobile crisis response that is on par to that of physical emergency response. Commenters also requested that the rule align with the mental health parity protections in the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). Response: OCR acknowledges commenters’ concerns regarding coverage for mental health services. Mental health services may be needed by people who may or may not be individuals with disabilities under this rule. OCR will examine complaints alleging less favorable treatment for mental health coverage as compared to physical health coverage on a case-bycase basis to determine if the coverage discriminates against people with disabilities. Reimbursement rates and policies are subject to § 92.207 as part of a plan’s benefit design, and thus must be provided in a nondiscriminatory manner. We also discuss reimbursement rates in the context of the integration provision under § 92.207(b)(6). We decline to incorporate or align this rule with MHPAEA, as section 1557 is a distinct Federal civil rights law. We note that coverage limitations found to 189 See Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2023, 87 FR 27208, 27301–02 (May 6, 2022) (concluding that age limitations on hearing aid coverage are presumptively discriminatory under 45 CFR 156.125 when applied to EHB and there is no clinical basis for the age distinction). We note these regulations are enforced by CMS and are distinct from section 1557 and other civil rights laws enforced by OCR. 190 45 CFR 156.110(a)(7) and 156.115(a)(5)(ii). PO 00000 Frm 00084 Fmt 4701 Sfmt 4700 violate section 1557 may also be prohibited under MHPAEA.191 Comment: Commenters expressed concerns about issuers discriminating against enrollees based on age through certain benefit designs. Commenters provided examples of practices they believed to be discriminatory, such as issuers requiring an ASD diagnosis by a certain age to access coverage for ASDrelated health care; not covering hearing aids for adults when otherwise covered for children; and imposing limitations on wheelchair and mobility device replacement for children that fail to align with how quickly children outgrow such devices. One commenter asked that OCR require issuers to attest that their pediatric benefit packages are comprehensive and age-appropriate by demonstrating that physical and mental health benefits do not have age, visit, or coverage limits that are not based on medical necessity or that are based on adult metrics. Commenters noted that plans that limit coverage to specific conditions or a child’s capacity to attain a certain functional status will unfairly prevent many children with special health care needs from accessing critically important services. Response: Section 1557 prohibits discrimination on the basis of age, consistent with the Age Act and its implementing regulations. The Age Act allows age distinctions under certain circumstances, including distinctions 191 The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA), Public Law 110–343; 42 U.S.C. 300gg– 26 (HHS); 29 U.S.C. 1185a (Department of Labor); 26 U.S.C. 9812 (Department of Treasury), and implementing regulations at 45 CFR 146.136 and 45 CFR 147.160, 29 CFR 2590.712, and 26 CFR 54.9812–1, respectively; The Departments of the Treasury, Labor, and HHS also published proposed rules on August 3, 2023 (88 FR 51552), to amend existing regulations and establish new regulations for the nonquantitative treatment limitation comparative analyses required under MHPAEA, as amended by the Consolidated Appropriations Act, 2021. The proposed rules would amend the existing rules to prevent group health plans and health insurance issuers offering group or individual health insurance coverage that provides both medical and surgical benefits and mental health or substance use disorder benefits from using nonquantitative treatment limits to place greater limits on access to mental health and substance use disorder benefits as compared to medical/surgical benefits; see also U.S. Dep’t of Labor, U.S. Dep’t of Health & Hum. Servs., U.S. Dep’t of the Treasury, 2022 MHPAEA Report To Congress: Realizing Parity, Reducing Stigma, and Raising Awareness: Increasing Access to Mental Health and Substance Use Disorder Coverage (2022), https://www.dol.gov/ sites/dolgov/files/EBSA/laws-and-regulations/laws/ mental-health-parity/report-to-congress-2022realizing-parity-reducing-stigma-and-raisingawareness.pdf; U.S. Dep’t of Labor, SelfCompliance Tool for the Mental Health Parity and Addiction Equity Act (MHPAEA), p. 38 (2020), https://www.dol.gov/sites/dolgov/files/EBSA/lawsand-regulations/laws/mental-health-parity/selfcompliance-tool.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations that reasonably take into account age as a factor necessary to the normal operation or the achievement of any statutory objective 192 of a program or activity; are based on age-related factors that bear a direct and substantial relationship to the normal operation of the program or activity or to the achievement of a statutory objective; provide special benefits to the elderly or children; or are contained in a rule or regulation issued by the Department.193 As a result, not all age-related distinctions in State or Federal law, including Department regulations, are prohibited by section 1557.194 As noted above, these permissible age distinctions form part of the ‘‘ground’’ of discrimination prohibited under the Age Act, because they identify distinctions that either are not forbidden age discrimination, 42 U.S.C. 6103(b)(1)(A) (‘‘reasonably takes into account age as a factor necessary to the normal operation or the achievement of any statutory objective of such program or activity’’), or are not age discrimination at all, id. section 6103(b)(1)(B) (‘‘based upon reasonable factors other than age’’). When investigating a benefit design with an age distinction, OCR will first determine whether the distinction is permitted under the Age Act (and therefore section 1557). If it is not, OCR will then investigate the age distinction to determine whether it violates section 1557. As with other benefit design investigations, OCR’s analysis will involve a fact-specific inquiry and will consider a covered entity’s reason for the age distinction in its benefit design. The covered entity’s justification must be a legitimate, nondiscriminatory reason, as discussed under § 92.207(c). For example, if an issuer is not able to provide a legitimate, nondiscriminatory reason to substantiate an age distinction in ASD coverage, such an age distinction would likely violate section 1557. We reiterate that this rule does not require a covered entity to provide coverage for all health services related to a particular disability or condition; rather, it requires covered entities to design their plan benefits in a nondiscriminatory manner. We note ddrumheller on DSK120RN23PROD with RULES4 192 45 CFR 91.12(b) (Defining ‘‘Statutory objective’’ to mean ‘‘any purpose of a program or activity expressly stated in any Federal statute, State statute, or local statute or ordinance adopted by an elected, general purpose legislative body.’’). 193 See 42 U.S.C. 6103(b); 45 CFR 91.12 through 91.14 and 91.17. 194 See, e.g., 42 U.S.C. 300gg; 45 CFR 147.102 (permitting premium rates charged by a health insurance issuer for health coverage offered in the individual or small group market to vary with respect to the particular plan of coverage by age, among other factors). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 that covered entities may also be subject to relevant CMS EHB nondiscrimination regulations regarding presumptively discriminatory age distinctions.195 OCR does not agree that it is necessary to require a separate attestation related to pediatric benefit packages. As recipients of Federal financial assistance, issuers are required to submit an Assurance of Compliance with section 1557 under § 92.5, which attests that they will not discriminate on the basis of age, among other prohibited bases. Comment: A commenter requested that OCR clarify the obligation of issuers and plan administrators to ensure that their staff, as well as the staff of any subsidiary entities with which they do business, receive explicit training on the relationship between benefit design choices and practices and activities that can amount to discrimination based on race, color, national origin, sex, age or disability. Response: Covered entities are responsible for ensuring their staff, subrecipients, and subcontractors are compliant with section 1557. Section 92.9 requires covered entities to provide training to relevant employees on their section 1557 Policies and Procedures, and while we note that it is in a covered entity’s best interest to ensure that relevant staff are adequately trained, we decline to specify additional training requirements at this time. Comment: Commenters requested that the final rule expressly state that section 1557 prohibits proxy discrimination in benefit design, either in the preamble or regulation. Commenters expressed concern that absent express incorporation of proxy principles, covered actors may attempt to evade section 1557’s nondiscrimination provisions. A commenter requested that the final rule incorporate established discrimination principles and noted that issuers continue to justify discriminatory plan designs by taking the position that health plans that target a particular medical service rather than a disability are neutral or uniform with respect to all enrollees. As an example, the commenter noted that plans 195 See, e.g., Patient Protection and Affordable Care Act; HHS Notice of Benefit & Payment Parameters for 2023, 87 FR 27208, 27301–02 (May 6, 2022) (providing examples of presumptively discriminatory benefit designs under CMS’ EHB nondiscrimination regulations applicable to nongrandfathered health insurance coverage in the individual and small group markets that include limitations on hearing aid coverage based on age, autism spectrum disorder coverage limitations based on age, and age limits for infertility treatment coverage when treatment is clinically effective for the age group). These regulations are enforced by CMS and are distinct from section 1557 and other civil rights laws enforced by OCR. PO 00000 Frm 00085 Fmt 4701 Sfmt 4700 37605 restricting coverage of dialysis justify it as not being discriminatory against enrollees with end-stage renal disease. The commenter requested that the final rule declare that discriminatory plan designs that limit dialysis treatment are a form of prohibited disability discrimination under section 1557 due to the fact that dialysis services are a near perfect proxy for end-stage renal disease, according to the commenter. Response: Proxy discrimination occurs when a policy or practice treats individuals differently on the basis of seemingly neutral criteria that are so closely associated with the disfavored group that discrimination on the basis of such criteria is, constructively, facial discrimination against the disfavored group.196 Proxy discrimination is one of many basic civil rights theories available to OCR when investigating complaints under section 1557 and which courts have applied in cases alleging discrimination under section 1557.197 Due to the fact-intensive nature of the analysis necessary, including determinations of whether a particular benefit design is discriminatory,198 we decline to expressly include this theory of discrimination in the rule text. As we have noted above, all claims under this section will be evaluated on a case-bycase basis. Comment: Some commenters noted that health insurance coverage and other health-related coverage may employ coverage limitations that are facially neutral and apply to all enrollees but have a disparate impact on a basis protected under section 1557. Specifically, commenters observed that these limitations and exclusions can have a particular discriminatory effect on individuals with disabilities who have chronic conditions and significant health needs. Response: OCR utilizes all applicable causes of action when investigating potential discrimination under section 1557 consistent with relevant case law. For further discussion related to OCR’s enforcement procedures, see § 92.301. 196 Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 945, 958 (9th Cir. 2020) (citing Davis v. Guam, 932 F.3rd 822, 837 (9th Cir. 2019)). 197 See, e.g., Schmitt v. Kaiser Found. Health Plan of Wash. No. 2:17–cv–01611–RSL, 2018 WL 4385858 (W.D. Wash. Sept. 14, 2018), aff’d in part, rev’d in part and remanded, 965 F.3d 945 (9th Cir. 2020); E.S. v. Regence BlueShield, No. 2:17–CV– 01609–RAJ, 2022 WL 279028, at *1 (W.D. Wash. Jan. 31, 2022). 198 See, e.g., Schmitt v. Kaiser Found. Health Plan of Wash., No. 2:17–cv–01611–RSL, 2018 WL 4385858 (W.D. Wash. Sept. 14, 2018), aff’d in part, rev’d in part and remanded, 965 F.3d 945 (9th Cir. 2020); E.S. v. Regence BlueShield, No. 2:17–CV– 01609–RAJ, 2022 WL 279028, at *1 (W.D. Wash. Jan. 31, 2022). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37606 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: Commenters requested that the final rule make clear the language in § 92.207(b), which addresses sex-related health services, includes the full spectrum of reproductive health services and treatments and medications for people with disabilities that may prevent, complicate, or end fertility or pregnancies. Response: OCR appreciates the unique challenges faced by people with disabilities seeking reproductive health care. Section 1557 prohibits discrimination on prohibited bases regardless of the type of care an individual is seeking or receive. Therefore, we do not believe it is necessary to provide specific provisions related to each form of care an individual may seek. Comment: Commenters requested that the final rule expressly state that infertility diagnoses, treatment, and services, including assisted reproductive technology, if offered, must be covered without regard to sexual orientation, gender identity, sex characteristics (including intersex traits), or any other protected basis. Commenters raised several examples of benefit design or coverage related to assisted reproductive technology that they stated should be prohibited as discriminatory against individuals based on their relationship status and sexual orientation. As examples, commenters cited requiring enrollees to use their spouse’s sperm to fertilize their eggs for in vitro fertilization and requiring that single enrollees or those in non-heterosexual relationships pay out of pocket for a predetermined number of failed intrauterine insemination cycles before providing coverage when heterosexual couples do not have to meet the same standard. Commenters stated that issuers justify these types of benefit design features on outdated definitions of infertility. A commenter argued that in vitro fertilization coverage should include screening for genetic abnormalities that are unique to enrollees’ lineage as a matter of reproductive justice and religious freedom. Response: OCR agrees that to the extent plans cover infertility diagnosis, treatment, and services, including assisted reproductive technology, they must do so on a nondiscriminatory basis, including for same-sex couples. Due to the fact-intensive nature of the analysis necessary, determinations of whether a particular benefit design is discriminatory under this section will be evaluated on a case-by-case basis. Comment: Commenters recommended that OCR add a new paragraph to § 92.207(b) affirming that denying or VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 limiting coverage of, or coverage of a claim for, health services because they may prevent, cause complications to, or end fertility or pregnancies is prohibited. Commenters asserted this language would address discrimination by a State program that otherwise provides coverage of contraceptives but excludes a specific contraceptive because of a medically inaccurate assertion that the contraception causes an abortion, or a provider network that only includes facilities that refuse to provide certain types of contraception. Commenters emphasized that individuals are currently being improperly denied access to medications or treatments for care unrelated to abortion because the medicine is also used for abortion care. Response: Denying access to specific medication or health services that may potentially be used for medication abortion purposes but are prescribed for reasons unrelated to abortion care may constitute discrimination under section 1557.199 OCR finds it unnecessary to add any additional regulatory language to prohibit such discrimination on the basis of disability and sex. As noted above, simultaneous discrimination on multiple prohibited bases is important to account for and is prohibited by section 1557. Comment: A commenter asked OCR to provide confirmation that while nothing in the regulation would require a covered entity to cover abortions, to the extent plans do cover abortions, they must do so on a nondiscriminatory basis. Response: As the commenter stated, nothing in this rule requires the provision of any particular medical care, including abortion. To the extent plans offer coverage for termination of pregnancies and related services, they must do so on a nondiscriminatory basis. Comment: Commenters recommended that OCR revise the regulatory text of proposed § 92.207(b)(4) and (5) to address sex discrimination related to pregnancy or related conditions by adding discrimination related to abortion, fertility care, and contraception. Some commenters requested that OCR specifically add ‘‘termination of pregnancy, contraception, fertility care, miscarriage management, pregnancy loss, maternity 199 See U.S. Dep’t of Health & Hum. Servs., Guidance to the Nation’s Retail Pharmacies: Obligations Under Federal Civil Rights Laws to Ensure Nondiscriminatory Access to Health Care at Pharmacies (Sept. 29, 2023), https://www.hhs.gov/ civil-rights/for-individuals/special-topics/ reproductive-healthcare/pharmacies-guidance/ index.html. PO 00000 Frm 00086 Fmt 4701 Sfmt 4700 care, other reproductive and sexual health services, or any health services’’ to the prohibitions on exclusions, limitations, and cost sharing related to gender transition or other genderaffirming care in § 92.207(b)(4) and (5). Response: OCR declines this suggestion. Section 92.207(b)(4) and (5) are not intended to list all types of potentially prohibited exclusions. The general prohibition on discriminatory limitations under § 92.207(b)(1) would apply to any exclusion or limitation related to all types of care that resulted in discrimination on the basis of sex. Comment: Some commenters stated that they oppose § 92.207 to the extent it violates religious freedom and conscience protections. Other commenters stated that they opposed § 92.207 because it prevents plans from excluding coverage of all gender affirming care. Response: Section 92.207 does not violate such protections because providers may rely on the protections of Federal religious freedom and conscience laws or choose to seek assurance of those protections from OCR under this final rule. With respect to concerns about potential conflicts between provisions of the final rule and individuals’ or organizations’ conscience or religious freedom, please refer to the preamble discussion of § 92.302. Additionally, we are revising § 92.207(c) to specify that nothing in this section precludes a covered entity from availing itself of protections described in § 92.3 and § 92.302. This modification is consistent with the revised language in § 92.206(c). As noted elsewhere in this preamble, and in § 92.3(c), insofar as the application of any rule requirement would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. Comment: Many commenters expressed strong support for the provisions in § 92.207(b)(3) through (5), citing the extensive discrimination faced by transgender people in the health insurance coverage and other health-related coverage context. Several legal service providers described their experiences assisting clients facing various types of discrimination in their health plans, even where State law or the plan terms provided some protection for gender-affirming care. Some commenters noted these provisions also addressed forms of discrimination commonly faced by intersex people. Commenters noted that the physical, mental health, and financial costs of such discrimination could be high, with individuals forgoing necessary care, facing extreme financial E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations burdens, and experiencing distress when denied access to necessary medical care. Both supporters and opponents of the Proposed Rule raised many of the same issues discussed in § 92.206(b)(4) (prohibiting categorical coverage exclusions on gender transition or other gender-affirming care) and (c) (discussing legitimate, nondiscriminatory reasons for denying or limiting care) above. As with § 92.206, some commenters asked OCR to define gender-affirming care or provide more detail about what types of care must be covered. Response: OCR agrees that transgender and intersex people have long faced discrimination in the health insurance coverage and other healthrelated coverage context. Many of OCR’s responses to the comments in § 92.206(b)(4) (prohibiting categorical coverage exclusions on gender transition or other gender-affirming care) and (c) (discussing legitimate, nondiscriminatory reasons for denying or limiting care) above are applicable to the comments in this section as well. For example, for the reasons we discussed above, we will not provide a definition of ‘‘gender-affirming care’’ in the regulation text. Comment: Commenters noted that even plans without categorical exclusions will exclude certain types of gender-affirming care as ‘‘cosmetic.’’ Commenters noted that categorizing procedures as cosmetic when needed for gender-affirming care is contrary to established standards of care for the treatment of gender dysphoria and urged OCR to explicitly prohibit such procedure-specific exclusions. Some commenters further noted that plans will often consider these procedures on a case-by-case basis when not related to gender transition but will not do so when the care is related to gender transition. Many commenters recommended deleting the word ‘‘all’’ from § 92.207(b)(4) to make clear that the exclusion of any gender-affirming care from coverage is prohibited. Some commenters stated that this change would be more consistent with § 92.207(b)(5), which more generally prohibits discriminatory limits on gender-affirming care coverage. Response: OCR appreciates commenters’ feedback and concern about forms of discrimination beyond broad categorical coverage exclusions. While we understand that some genderaffirming care exclusions are limited to the specific type of care at issue, we decline to revise the language of § 92.207(b)(4). Section 92.207(b)(5)’s VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 general prohibition on limitations or restrictions on coverage for gender transition or other gender-affirming care reaches the narrower exclusions or restrictions on gender-affirming care. We also decline to state that any denial of gender-affirming care will necessarily be discriminatory regardless of context or rationale. We will instead consider claims of discrimination raising non-categorical denials on a case-by-case basis. Where OCR receives complaints about such exclusions or restrictions, we will investigate on a case-by-case basis whether they constitute prohibited discrimination under § 92.207(b)(5) or any other applicable provision of the rule. Since section 1557 only prohibits discrimination and does not prescribe any specific standard of care, such denials will violate the final rule only where they entail discrimination on the basis of sex. As stated throughout this section, covered entities will have the opportunity to provide a legitimate, nondiscriminatory reason for such exclusions or restrictions. Comment: Some commenters proposed striking the phrase ‘‘if such denial, limitation, or restriction results in discrimination on the basis of sex’’ from § 92.207(b)(5), stating that the elimination would make this provision clearer. Commenters viewed this phrase as confusing and redundant, as they stated that limiting or restricting coverage for services related to genderaffirming care is necessarily discriminatory. Another commenter noted the intersectionality of discrimination and stated that this language may be limiting. Response: For the reasons discussed above, we disagree that any restriction impacting gender-affirming care will necessarily constitute prohibited discrimination. For example, if an insurance plan places restrictions on coverage for gender-affirming surgeries that are no more stringent than the restrictions placed on any other type of surgical care, those restrictions will not violate the rule. As such, we decline to make the deletion proposed by these commenters. OCR agrees that the rule prohibits discrimination in the provision or coverage of gender-affirming care whether it is on the basis of sex or on the basis of race, color, national origin, age, or disability. That said, allegations about such discrimination are best brought under § 92.207(b)(1), as § 92.207(b)(5) is aimed at the types of denials or limitations on coverage that are based on a person’s gender identity and are thus a form of sex discrimination. PO 00000 Frm 00087 Fmt 4701 Sfmt 4700 37607 Comment: Commenters noted that even plans without categorical exclusions of gender-affirming care may adopt barriers to accessing such care, such as more stringent pre-approval processes. The commenters noted that these requirements could result in transgender people ultimately not receiving necessary care or having to invest significant time and resources to navigate the barriers. Some commenters additionally noted the high mental health toll on individuals facing discriminatory limitations on medically necessary care. Response: OCR appreciates the commenter’s feedback and concern about the forms of discrimination transgender people encounter in seeking coverage for gender-affirming care but declines to revise § 92.207(b)(3) as suggested. Section 92.207(b)(5) prohibits limitations or restrictions on coverage for gender transition or other genderaffirming care. Comment: Many commenters supported the provisions limiting issuers’ ability to deny care based on a person’s sex assigned at birth, gender identity, or gender otherwise recorded, noting that transgender, nonbinary, and intersex people can all face such discriminatory denials. Other commenters objected to these provisions, expressing concern that this would compel issuers to pay for care that was not medically necessary or appropriate for a given individual. Response: Section 92.207(c) makes clear that a nondiscriminatory determination that care is not medically necessary based on a patient’s anatomy or medical need is permissible. For example, this final rule would not prohibit a covered entity from denying coverage for preventive health services for a transgender patient where such care is not medically necessary, such as a prostate exam for a transgender man who does not anatomically have a prostate. In contrast, the rule may prohibit a covered entity from denying coverage for medically necessary preventive care for a transgender patient. Comment: One provider group urged OCR to work with the Office of the National Coordinator for Health Information Technology (ONC) and electronic health record vendors to ensure that there are options for separately identifying a patient’s gender identity and anatomy to reduce the risk of improper denials. Response: OCR appreciates the suggestion that discriminatory denials could be reduced if the records systems used by providers, issuers, and other covered entities provide better options E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37608 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations for recording gender identity and sex characteristics. While minimum standards for record systems are not within the scope of the rule, we are committed to working with ONC and other relevant stakeholders to explore solutions to this issue. Comment: Commenters noted that transgender people often have difficulty getting their health coverage to update their records to reflect their correct name and gender. Commenters noted that gender marker mismatches in health insurance records can result in denial of coverage for clinically appropriate care, and one commenter urged OCR to make clear that claims processing procedures that automatically deny coverage for care based on a perceived mismatch of sex or gender is a form of impermissible sex discrimination. Response: OCR appreciates commenters’ concerns about coverage denials due to a sex mismatch in claims processing procedures, which can result in transgender patients being denied coverage for a medically necessary and clinically appropriate services. However, we decline to categorically state that sex mismatch denials are always discriminatory. Instead, OCR will consider and investigate complaints raising this issue on a case-by-case basis under § 92.207(b)(3). While we refrain from categorically stating that initial sex mismatch or coding denials are prohibited under this rule, we caution that denials resulting in an undue delay or denial of services, such as repeated denials, could result in a finding of prohibited discrimination. For more information on OCR’s view of this issue, please see the 2016 Rule preamble’s discussion on computer systems with gender coding resulting in gender mismatches at 81 FR 31436. Comment: With respect to cases where coverage for comparable treatments is relevant to the discrimination analysis, some commenters urged OCR to clarify that the question of what is comparable can be construed broadly, rather than parsing minor differences in broadly similar types of care. Response: OCR declines to identify a bright line of how similar care must be to be considered comparable when such considerations are relevant to a discrimination claim, as there are many factors that may be relevant to this analysis, and our approach is case by case. Comment: Commenters who addressed the integration requirement in § 92.207(b)(6) overwhelmingly supported the newly proposed provision, which clarifies the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 prohibition on having or implementing benefit designs that do not provide or administer health insurance coverage or other health-related coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities. Several noted the particular importance of this provision and access to community integration in light of the COVID–19 pandemic and the higher infection risks associated with congregate settings. A few commenters noted the role that discrimination on multiple bases may play with regard to community integration, highlighting the overrepresentation of people of color in institutional settings, and the relationship between access to effective communication and community integration. Numerous comments included examples of current practices that may violate the integration provision. Commenters agreed that this provision should apply to both benefit design and implementation of a benefit design, including: coverage, exclusions, and limitations of benefits; prescription drug formularies; cost sharing (including copays, coinsurance, and deductibles); utilization management practices; medical management standards (including medical necessity standards); provider network design; provider reimbursement; standards for provider admission to participate in a network; benefits and service administration contracted to third parties, such as pharmacy benefit managers; and quality measurement and incentive systems. Many commenters requested that OCR clarify that the convenience or potential cost-saving of administering treatments in institutional settings are not legitimate, nondiscriminatory reasons for not providing comparable benefits in less restrictive settings. Commenters suggested that providing coverage to qualified individuals with disabilities in the most integrated setting appropriate should not be done in a way that unnecessarily increases costs for all enrollees or compromises individual health benefits. Response: We appreciate support for the inclusion of this provision. OCR recognizes the importance of providing and administering health coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities; we also recognize that discrimination on multiple bases heightens barriers and are committed to addressing allegations of discrimination on all bases protected under section 1557. As discussed in the Proposed Rule, 87 FR 47873, this provision encompasses both the benefit design of PO 00000 Frm 00088 Fmt 4701 Sfmt 4700 the benefit being offered by a covered entity as well as the indirect mechanisms that affect the implementation of the benefit design within a covered entity’s control, such as utilization management practices, provider reimbursement, contracting out to third-party contractors such as pharmacy benefit managers, and quality measurement and incentive systems. OCR is not prescriptive in the list of potential mechanisms that could result in prohibited discrimination through implementation of a benefit design because it is a case-by-case analysis depending on the facts of each situation. With respect to concerns about unnecessarily increasing costs to comply with this provision, OCR notes that institutional care is generally more expensive than community-based care and that increased cost alone is not necessarily a fundamental alteration.200 However, concerns related to cost can be raised through a fundamental alterations defense.201 Comment: Nearly all commenters who addressed this provision agreed with the 2022 NPRM preamble language stating that requiring prior authorization, step therapy, or other utilization management when individuals access treatment in the community but not in an institution, would constitute discrimination if the discrepancy results in unnecessary segregation or a serious risk of unnecessary segregation. Commenters noted that these practices place additional terms and conditions on the receipt of certain benefits in integrated settings that are not in place within segregated or institutional settings, and that they can often delay care and cause unnecessary institutionalization. For example, commenters asserted that people with physical and sensory disabilities, complex medical needs, and people with psychiatric and mental disabilities are often required to try less expensive and often unsuccessful medication (i.e., step therapy) before being able to access effective treatments in the community. If utilization management techniques are only required for community-based treatment and not for institutional care, commenters argued this may push individuals urgently in need of care into institutional setting so they can access treatment more quickly. In contrast, one commenter suggested that it may be clinically appropriate to distinguish between institutional settings and home and community-based settings (HCBS) through the use of medical management 200 Fisher v. Okla. Health Care Auth., 335 F.3d 1175, 1183 (10th Cir. 2003). 201 Id. at 1182. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 tools like prior authorization and step therapy due to closer monitoring by medical professionals in institutional settings. Response: OCR shares commenters’ concerns about the potential discrimination associated with the serious risk of institutionalization. The integration mandates of the ADA and section 504 apply to people with disabilities who are at serious risk of segregation or institutionalization, not only to people with disabilities who are currently in institutions.202 For example, an individual could show sufficient risk of institutionalization such that it would constitute a violation of this provision if a covered entity’s failure to provide community services or its cut to such services will likely cause a decline in health, safety, or welfare that result in the serious risk of institutionalization or segregation. As articulated in the Proposed Rule, 87 FR 47873, step therapy and other utilization management practices that impose different standards on members or beneficiaries in the community than in institutional settings are discriminatory if the discrepancy results in unnecessary segregation or a serious risk of unnecessary segregation. Section 1557’s incorporation of section 504’s integration provision through § 92.101(b)(1) makes clear that serious risk of institutionalization is covered under section 1557 as well, given that the vast majority of courts have found section 504 and title II of the ADA prohibits actions, omissions, policies, and practices that place individuals at serious risk of unjustified isolation. Indeed, nearly every court of appeals to address the issue has held that the integration mandate of the ADA and section 504 apply not only to people 202 See, e.g., Waskul v. Washtenaw Cnty. Cmty. Mental Health, 979 F.3d 426, 460–62, (6th Cir. 2020) (‘‘Plaintiffs may thus state a claim by sufficiently alleging that they are at serious risk of institutionalization’’); Steimel v. Wernert, 823 F.3d 902, 911–12 (7th Cir. 2016) (agreeing that the mandate applies to ‘‘persons at serious risk of institutionalization or segregation’’); Davis v. Shah, 821 F.3d 231, 262–64 (2d Cir. 2016) (‘‘We thus hold that a plaintiff may state a valid claim . . . by demonstrating that the defendant’s actions pose a serious risk of institutionalization for disabled persons.’’); Pashby v. Delia, 709 F.3d 307, 322 (4th Cir. 2013) (individuals state claims under the ADA and the Rehabilitation Act when ‘‘they face a risk of institutionalization’’); M.R. v. Dreyfus, 663 F.3d 1100, 1117–18 (9th Cir. 2011), amended by 697 F.3d 706 (9th Cir. 2012) (plaintiff must ‘‘show that the challenged state action creates a serious risk of institutionalization’’); Fisher v. Okla. Health Care Auth., 335 F.3d 1175, 1181–82 (10th Cir. 2003) (plaintiffs who ‘‘stand imperiled with segregation’’ because of state action may state a claim under the ADA’s integration mandate); but see U.S. v. Miss., No. 21–60772, 2023 WL 6138536, at *5–*9 (5th Cir. Sep. 20, 2023) (rejecting the United States’ at-risk Olmstead claim). VerDate Sep<11>2014 22:57 May 03, 2024 Jkt 262001 with disabilities who are currently in institutions, but also to people with disabilities who are at serious risk of segregation or institutionalization.203 As noted in Fisher v. Oklahoma, the integration mandate’s ‘‘protections would be meaningless if plaintiffs were required to segregate themselves by entering an institution before they could challenge an allegedly discriminatory law or policy that threatens to force into segregated isolation.’’ 204 Likewise, section 1557’s integration mandate would ring hollow if individuals were required to show that they have already had to submit to institutionalization in order to assert their right to receive services in the most integrated setting appropriate to their needs. Further, even if a serious risk of unnecessary institutionalization was not an actionable claim in and of itself, it would still be appropriate for courts to grant relief to those at serious risk in order to prevent the unnecessary institutionalization prohibited by law.205 For these reasons, the rule’s integration provision explicitly prohibits benefit design that results in a serious risk of institutionalization. Plans continue to be able to limit services, use utilization review standards, and employ other limitations to manage costs as long as they are not discriminatory in doing so. OCR has revised the regulation text to clarify that the integration requirement under section 1557 extends to practices that result in the serious risk of institutionalization or segregation. We recognize that the question of what constitutes ‘‘serious risk’’ is a fact-based inquiry, which is why the Federal courts to have considered the question have provided only general guidance on determining risk rather than an exhaustive test.206 Comment: Several commenters strongly disagreed with the 2022 NPRM 203 See supra footnote 202 (citing cases). F.3d 1175, 1181 (10th Cir. 2003). 205 See, e.g., U.S. v. W.T. Grant Co., 345 U.S. 629, 633 (1953) (explaining that ‘‘[t]he purpose of an injunction is to prevent future violations’’ and that such relief is appropriate where there is a ‘‘cognizable danger of recurrent violation.’’). 206 For example, in Davis v. Shah, 821 F.3d 231, 262–63 (2d Cir. 2016), the court quoted DOJ, noting that ‘‘a plaintiff ‘need not wait until the harm of institutionalization or segregation occurs or is imminent’ ’’ to bring a claim under the ADA. A plaintiff establishes a ‘‘sufficient risk of institutionalization to make out an Olmstead violation if a public entity’s failure to provide community services . . . will likely cause a decline in health, safety, or welfare that would lead to the individual’s eventual placement in an institution.’’ See also Waskul v. Washtenaw Cnty. Cmty. Mental Health, 979 F.3d 426, 462 (6th Cir. 2020) (finding ‘‘declines in health, safety, or welfare’’ as to sufficient to show plaintiffs were at serious risk of institutionalization). 204 335 PO 00000 Frm 00089 Fmt 4701 Sfmt 4700 37609 preamble language that stated that a State Medicaid program would generally not be required to provide a new benefit because that would fundamentally alter the nature of the program. Commenters noted that a State Medicaid program or other covered entity may have to expand its HCBS waiver programs or modify eligibility for particular services where necessary to satisfy the integration provision, and that there are many situations in which a State program has been required to create a ‘‘new’’ community-based benefit, where that benefit was previously only available in institutional settings. For example, commenters stated that a covered entity that provides for residential treatment for certain substance use disorder conditions and does not provide coverage of such services in appropriate community-based settings may need to create a ‘‘new benefit’’ by offering an existing institutional benefit in the community. Response: After considering these comments, we clarify here that while a State Medicaid program is not required to create ‘‘new’’ programs to assist people with disabilities, nor are states required to provide a particular standard of care or level of benefits, covered entities must nevertheless adhere to section 1557’s disability nondiscrimination requirements— including the integration requirement— with regard to the services they in fact provide. When a covered entity chooses to provide a service, it must do so in a nondiscriminatory fashion by ensuring access to that service in the most integrated setting appropriate to the needs of the qualified individual.207 States may be required to offer services in an integrated setting that they have only been offering in segregated settings; that is not offering a ‘‘new service,’’ but instead is ensuring the service is offered in integrated settings and not just in segregated settings.208 207 See Olmstead, 527 U.S. 581, 603 (1999); see also Radaszewski v. Maram, 383 F.3d 599, 609 (7th Cir. 2004) (citing Olmstead, 527 U.S. at 603 n. 14, for the principle ‘‘that States must adhere to the ADA’s nondiscrimination requirement with regard to the services they in fact provide’’) (‘‘While ‘a State is not obligated to create new services,’ it ‘may violate Title II when it refuses to provide an existing benefit to a disabled person that would enable that individual to live in a more communityintegrated setting.’’’). 208 See U.S. Dep’t of Justice, Civil Rts. Div., Statement of the Dep’t of Justice on Enforcement of the Integration Mandate of Title II of the Americans with Disabilities Act and Olmstead v. L.C., Question 8 (February 28, 2020), https://www.ada.gov/ olmstead/q&a_olmstead.htm (stating that ‘‘(p)ublic entities cannot avoid their obligations under the ADA and Olmstead by characterizing as a ‘‘new E:\FR\FM\06MYR4.SGM Continued 06MYR4 37610 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 OCR clarifies that a program providing community-based services that are already available in institutional settings is not a new program for purposes of evaluating a fundamental alteration defense.209 In addition, states may be required to offer services in an integrated setting that have only been offered in a segregated setting. Providing services beyond what a State currently covers under its Medicaid program may not be a fundamental alteration under § 92.205 (Requirement to make reasonable modifications), and existing nondiscrimination law, including section 504 and the ADA,210 may require states to provide those services, under certain circumstances. In addition, to the extent that a benefit, including an optional benefit, is already provided in institutions as part of the State’s program, the same or a substantially similar benefit must be offered in the community in a manner that does not incentivize institutional services over community services. Comment: OCR received many comments in response to our request for comment on the application of the integration provision to State Medicaid programs. A number of comments related to Medicaid program designs required by title XIX of the Social Security Act. One commenter recommended that any action by a State Medicaid authority to reduce the existing scope of Medicaid-funded home and community-based long term services and supports, or to more strictly limit eligibility for them, that would have the effect of forcing people with disabilities who currently do, or could, live in their own homes and participate in unrestricted community activities into segregated, congregate, and/or institutional residential or day settings, or to cease their current level service’’ services that they currently offer only in institutional settings.’’); see also Townsend v. Quasim, 328 F.3d 511, 517 (9th Cir. 2003) (‘‘Here, the precise issue is not whether the state must provide the long term care services sought by Mr. Townsend and the class members—the state is already providing these services—but in what location these services will be provided.’’). 209 See Townsend, 328 F.3d at 517 (‘‘[c]haracterizing community-based provision of services as a new program of services not currently provided by the state fails to account for the fact that the state is already providing those very same services. If services were to constitute distinct programs based solely on the location in which they were provided, Olmstead and the integration regulation would be effectively gutted.’’). 210 While this final rule periodically references the ADA and section 504, the requirements under this rule are under section 1557, a separate legal authority. Accordingly, the integration requirements, like other requirements under this section 1557 rule, do not limit or impact the interpretation of integration requirements under the ADA and section 504. VerDate Sep<11>2014 22:57 May 03, 2024 Jkt 262001 of community participation, on the basis of any general categorization of disability would be discriminatory under this provision. Response: We appreciate the many comments highlighting potential issues related to community integration and State Medicaid programs. This rule does not impact the ability of states to target benefits under section 1915(c), section 1915(i), or section 1937 of the Social Security Act, consistent with Medicaid law. At the same time, the fact that a State chooses to use a Medicaid authority to target a particular disability population does not relieve a State of its obligations towards other populations. We will continue to work with our partners in CMS to ensure the robust provision of services in a nondiscriminatory manner to the maximum extent possible. We remind covered entities that obligations under the Medicaid statute are distinct from obligations under section 1557, and compliance with Medicaid requirements does not per se constitute compliance with section 1557. Comment: A significant number of commenters raised concerns with ‘‘usein-the-home’’ policies, where an insurance issuer will cover the provision of a benefit or service solely for use ‘‘in the home.’’ For example, commenters discussed that a covered entity might offer supplemental oxygen equipment for use in the home but decline to provide sufficient oxygen or equipment for an individual to access the broader community. Similarly, commenters noted that issuers might decline to cover medically necessary wheelchairs with functions that an individual needs to access the broader community outside their home. Commenters also provided examples of other kinds of medical diagnostic equipment, durable medical equipment, and home-use devices that are often not covered, but which would replace services provided in an institution and enable individuals to receive care in their home and community. Commenters expressed concern that many State Medicaid programs, delegated managed care companies, and employer-sponsored private health plans have adopted the Medicare Mobility Assistive Equipment Coverage Policy 211 (a policy designed specifically to apply in the context of Medicare Part B) as their policy, despite what commenters see as the statutory differences between Medicare Part B 211 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., National Coverage Determination, Mobility Assistive Equipment (MAE) (2005), https://www.cms.gov/medicare-coveragedatabase/view/ncd.aspx?NCDId=219. PO 00000 Frm 00090 Fmt 4701 Sfmt 4700 and other authorities. Commenters contended that the unnecessary and unmandated adoption of such a policy in all programs unnecessarily restricts benefits to a low bar, denying people the ability to live in the most integrated setting possible. Response: We appreciate the concerns raised by commenters. Each covered entity should review any legal authority governing the coverage they may provide to ensure that they are not interpreting it in a manner that results in discrimination. For example, Medicaid programs that impose homebound or ‘‘in-the-home’’ criteria that are not statutorily required under Federal law may be unnecessarily restricting services in the community in violation of civil rights laws. Where an in-the-home restriction is included in a statute, covered entities may not automatically deny coverage for any good or service that may also have use outside of the home, but must assess each claim to determine whether the denial will violate the most integrated setting requirement. Comment: Many commenters expressed the need for § 92.207(b)(6), due to states increasingly turning to managed care plans to deliver Medicaid benefits. These commenters expressed concern that large issuers that administer a range of private employer plans and individual plans, as well as public Medicare and Medicaid plans, could employ uniform coverage policies across their plans that do not adequately support community integration. Commenters additionally noted that that Medicaid agencies should monitor whether Medicaid Managed Care Organizations (MCOs) are appropriately authorizing services in the community and that under current law states contracting with MCOs cannot escape liability when MCOs discriminate against people with disabilities. Response: We appreciate the concerns raised by commenters. We recognize the increasing reliance on alternative payment models for the delivery or management of services to individuals with disabilities. The shift towards managed care in State Medicaid programs and other changes, such as quality incentives, quality assurance activities, and risk-sharing arrangements, requires addressing unnecessary segregation in these emerging models in this rule. As we noted in the Proposed Rule, 87 FR 47873, covered entities designing contracts with MCOs, pharmacy benefit managers, or other third-party entities taking on financial risk for the delivery of health services should carefully scrutinize their capitation, E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations reimbursement, quality measurement, and incentive structures to ensure that they do not result in the unjustified segregation of individuals with disabilities or place individuals with disabilities at serious risk of institutionalization or segregation. When responsibility for services is shared across multiple entities, for example, under a managed care contract, both the State Medicaid agency and the contracted entity have obligations under this provision if they are both recipients of Federal financial assistance. Comment: Many commenters discussed challenges related to mental health services, noting that the lack of available and funded community alternatives to institutional mental health care will continue to result in the institutionalization of individuals with serious mental illness, whether in hospitals, inpatient psychiatric facilities, prisons, or other secure facilities. Many commenters voiced concern related to discharge planning, as people requiring intensive mental health services are often referred only to institutional or otherwise congregate care options, rather than comparably intensive services in community-based settings. Commenters recommended that OCR clarify that this can constitute a violation of the integration provision if it forces people with psychiatric disabilities to enter segregated settings in order to receive access to adequate services. Other commenters discussed the disparity in access to community-based care for children who need mental health care. Response: OCR appreciates the significant concerns related to the availability of community-based behavioral health services, particularly services to address youth mental health. With respect to discharge planning, a hospital or acute care provider that routinely discharges individuals with disabilities, including those with serious mental illness, to nursing homes, psychiatric residential treatment facilities, or other segregated care settings due to discharge planning procedures that do not assess for homebased support services or refer individuals to community-based providers may violate this provision. Covered entities are prohibited from implementing planning, service system design, and service implementation practices that result in the serious risk of institutionalization or segregation. Comment: Several commenters provided insight into the relationship between community integration and VerDate Sep<11>2014 22:57 May 03, 2024 Jkt 262001 reimbursement rates necessary to sustain a direct care workforce. Commenters explained that individuals receiving care in the community often fail to receive all of the hours of care for which they are approved due to a lack of provider capacity to fully staff the approved hours. Commenters noted that nurse’s aides and other individuals who provide assistance in institutional settings are often paid at a higher rate than home health aides and other direct care professionals, resulting in an imbalanced direct care workforce. Commenters emphasized the importance of rate setting to incentivize HCBS. Response: Reimbursement rates and network adequacy both constitute methods of program administration. As such, these are factors that OCR would consider as reimbursement practices or methods of administration related to this provision. Comment: Commenters suggested additional guidance clarifying implementation of this provision, including incorporating DOJ’s guidance on enforcement of the integration requirement under title II of the ADA describing how to provide the most integrated setting appropriate for an individual or group of individuals; 212 addressing the remedies available for violations of the integration provision; and explaining how OCR will undertake a fundamental alteration analysis. One commenter recommended incorporating the fundamental alteration defense into regulatory text. Commenters underscored the importance of setting a high bar for a fundamental alteration, noting that programs must alter an essential aspect of the health program or activity. Other commenters urged OCR to clarify how the fundamental alteration analysis applies to the integration provision, including whether and how OCR will incorporate DOJ guidance and case law related to the ADA’s fundamental alteration defense for ADA title II entities. Commenters also requested clarification on whether covered entities will be required to establish an Olmstead integration plan 213 to raise the 212 U.S. Dep’t of Justice, Civil Rts. Div., Statement of the Dep’t of Justice on Enforcement of the Integration Mandate of Title II of the Americans with Disabilities Act and Olmstead v. L.C. (June 22, 2011), https://www.ada.gov/olmstead/q&a_ olmstead.htm. 213 Under the ADA, an Olmstead plan is a public entity’s plan for implementing its obligation to provide individuals with disabilities opportunities to live, work, and be served in integrated settings. U.S. Dep’t of Justice, Civil Rts. Div., Statement of the Dep’t of Justice on Enforcement of the Integration Mandate of Title II of the Americans with Disabilities Act and Olmstead v. L.C. (June 22, PO 00000 Frm 00091 Fmt 4701 Sfmt 4700 37611 fundamental alteration defense, and if so, guidance related to that requirement. Commenters also asked OCR to explain in future guidance how covered entities, including Medicaid programs, must coordinate community-based primary care and specialty mental health care and offer case management to avoid discrimination on the basis of disability and to avoid placing individuals with mental disabilities at serious risk of institutionalization. Commenters further suggested guidance to covered entities explaining the specific HCBS that are essential to achieving compliance with the integration requirement, including as part of EHB. Commenters suggested that it would be discriminatory if EHB plans set higher reimbursement rates for a service or item for individuals in segregated settings rather than community-based settings; if rehabilitation services for physical conditions are covered, but not psychiatric rehabilitation services; and if a particular benefit (such as personal care services) is offered in greater amounts to individuals in segregated settings by virtue of the plan benefit design. Finally, commenters encouraged OCR to develop joint guidance with DOJ on section 1557, section 504, and titles II, III, and IV of the ADA to ensure the rights of people with disabilities to access community integration in health care settings. Response: We appreciate the comments requesting clarification through sub-regulatory guidance. We will consider future guidance after this rule has been finalized and are committed to our continued partnership with DOJ in developing shared guidance on civil rights requirements. The availability of the fundamental alteration defense is clear as drafted and so we decline to specifically incorporate this recommendation into regulation text. In this final rule, we clarify that a program is not required to provide coverage for a service in the most integrated setting appropriate to an individual’s needs if it would fundamentally alter the program to do so. Comment: Commenters, primarily representatives of the insurance industry, supported proposed § 92.207(c) that specified nothing in this section requires coverage of any health service where the covered entity has a legitimate, nondiscriminatory reason for determining that such health service fails to meet applicable coverage 2011), https://www.ada.gov/olmstead/q&a_ olmstead.htm. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37612 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations requirements, such as medical necessity requirements, in an individual case. Commenters appreciated that OCR acknowledged that a covered entity’s legitimate, nondiscriminatory reason for its actions may serve as a defense under this section. Some commenters requested clarification that use of the phrase ‘‘legitimate, nondiscriminatory reason’’ not be construed in any way to limit the method of proof for any section 1557 claim to the McDonnell Douglas burdenshifting framework; that this method cannot be used to defend an express sex classification that causes injury; that the familiar but-for causation test applies to establishing a violation of section 1557; and that the McDonnell Douglas burdenshifting framework and legitimate nondiscriminatory reason framework apply to circumstantial evidence cases but not where there is direct evidence of discrimination. Response: OCR appreciates commenters’ support of this provision. As discussed throughout this section and in the Proposed Rule, in instances where there is not a facially discriminatory policy and OCR is investigating whether a particular action or practice is discriminatory under this rule, covered entities have the opportunity to defend the challenged action or practice by providing a legitimate, nondiscriminatory reason for its actions that is not pretext for discrimination. OCR will then evaluate whether the reason given by the covered entity is a pretext for prohibited discrimination. When considering whether a proffered reason is pretextual, OCR will consider, among other things, whether a denial of a health service is based on medical necessity standards or other reasonable medical management techniques that are not discriminatory, as discussed in more detail below. To provide additional clarity about OCR’s analysis when evaluating whether a covered entity’s legitimate, nondiscriminatory reason is pretextual, OCR is revising § 92.207(c) to state that a covered entity’s denial or limitation of a health service must not be based on unlawful animus or bias, or constitute a pretext for discrimination. This modification is consistent with the revised language in § 92.206(c). Under either section, in instances where there is no evidence of a facially discriminatory policy, covered entities may assert a legitimate, nondiscriminatory basis for actions that could otherwise give rise to the inference of discrimination. Consistent with general principles of civil rights law, OCR will consider such asserted bases but may also investigate to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 determine whether such asserted bases are pretextual and whether there is evidence that the challenged action was taken because of unlawful animus, bias, or other discriminatory factors. In evaluating claims of discrimination, OCR relies on general nondiscrimination principles and longstanding civil rights case law. Such principles include, but are not limited to, the multi-factor test articulated in Arlington Heights and the McDonnell Douglas burden-shifting framework, which were discussed in detail in the Proposed Rule at 87 FR 47865. Arlington Heights sets forth a method of proof that utilizes different types of evidence that collectively may demonstrate that a covered entity acted, at least in part, because of a protected basis. The McDonnell Douglas burdenshifting framework is an inferential method of proof used to show that a covered entity treated similarly situated individuals differently because of a protected basis. Under McDonnell Douglas, where non-facial evidence of discrimination exists, a covered entity must articulate a legitimate, nondiscriminatory reason for its actions. The entity’s legitimate, nondiscriminatory reason may refute the evidence of discrimination, unless it can be established that this reason is a mere pretext for prohibited discrimination. In response to the commenters’ concerns about how § 92.207(c) may be interpreted inconsistently with the principles set forth in McDonnell Douglas and other civil rights principles, please see our response to the same comments under § 92.206 in which we affirm commenters’ interpretations are correct—McDonnell Douglas’ burdenshifting framework and legitimate nondiscriminatory reason framework apply to circumstantial evidence cases but not in cases where there is direct evidence of discrimination based on a facially discriminatory policy. Comment: Some commenters appreciated OCR clarifying that medical management techniques based on clinical evidence are permitted, including the use of reasonable medical necessity and utilization management techniques based on clinical standards and evidence-based guidelines, when applied in a neutral manner. Commenters noted that medical management tools provide an important role in promoting quality care and reducing health care costs. Other commenters raised concerns about medical necessity criteria and other medical management tools, noting that such tools may limit access to needed services and treatment. PO 00000 Frm 00092 Fmt 4701 Sfmt 4700 Commenters noted that discriminatory decisions often occur under the guise of medical necessity determinations. Some commenters argued that medical management practices such as prior authorization, step therapy, and durational or quantity limits are inherently discriminatory and inconsistent with patient health and safety. Many commenters strongly supported OCR clarifying that excessive use or administration of benefit utilization management tools that target particular disabilities could violate section 1557. Commenters asked OCR to expressly note the limitation on the use of utilization management tools in the text of the regulation. Commenters asked OCR for examples of excessive medical management and suggested the following examples: requiring step therapy for new enrollees who are already on a working course of treatment; transferring management of particular medicines to niche vendors that apply more extensive medical management through specialty carve-out programs; requiring the use of off-label medications within step therapy; and imposing categorical prior authorization and step therapy requirements on most or all drugs required to treat a particular disease. Commenters noted that issuers apply such medical management techniques to discourage individuals with high-cost needs from enrolling in their plans. A commenter cited evidence that plans have restricted access to lower-cost brand drugs and generics when demand for those drugs attracts patients who have overall high health costs.214 Other commenters noted that information about treatment limitations can be difficult to find for enrollees and cited evidence of issuers building arbitrary coverage denials into their business plans.215 Commenters cited a study that found that more than half of step therapy policies developed by commercial health plans were more 214 Michael Geruso et al., Screening in Contract Design: Evidence from the ACA Health Insurance Exchanges, 11 a.m. Econ. J.: Econ. Pol. 2, 64–107 (2019), https://www.ncbi.nlm.nih.gov/pmc/articles/ PMC8130799/. 215 Karen Pollitz et al., Claims Denials and Appeals in ACA Marketplace Plans in 2021, Kaiser Family Found. (2022), https://www.kff.org/privateinsurance/issue-brief/claims-denials-and-appealsin-aca-marketplace-plans/ (finding nearly 17 percent of in-network claims in non-group qualified health plans were denied in 2021; insurer denial rates varied widely around this average, ranging from 2 to 49 percent; about 14 percent were denied because the claim was for an excluded service, 8 percent were due to lack of preauthorization or referral, 2 percent were based on medical necessity, and 77 percent were classified as ‘‘all other reasons’’). E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 restrictive than recommended clinical guidelines.216 Some commenters requested that OCR revise the text of § 92.207(c) to state that, in addition to medical necessity requirements, covered entities may employ reasonable medical management techniques. Response: OCR appreciates the variety of comments and recommendations put forth by commenters related to the rule’s coverage of medical management techniques, including medical necessity standards and utilization management techniques. OCR agrees that revising the regulatory text to reference reasonable medical management techniques would provide clarity and would be consistent with other provisions in the ACA and the Proposed Rule. Therefore, OCR is revising § 92.207(c) to state that applicable coverage requirements include reasonable medical management techniques, including medical necessity. Further, as stated in the Proposed Rule, covered entities are not prohibited from employing reasonable medical management techniques as long as they are not discriminatory and are not otherwise prohibited under other applicable Federal and State law. 87 FR 47873–74. As just one example, covered entities participating in the Medicaid program under title XIX of the Social Security Act are not prohibited from implementing nondiscriminatory utilization management techniques, such as prior authorization.217 Under § 92.207(c), an issuer may assert a legitimate, nondiscriminatory reason for its denial or limitation of coverage of a health service that asserts the denial was based on medical necessity standards—or any other medical management technique. When assessing whether the challenged action was based on prohibited discrimination rather than on nondiscriminatory medical necessity standards, OCR will review a medical necessity determination only to make sure that it is a bona fide medical judgment, not conduct a review of the medical judgment underlying the medical necessity determination, but rather will 216 Kelly L. Lenahan et al., Variation in Use and Content of Prescription Drug Step Therapy Protocols, Within and Across Health Plans, 40 Health Affairs 11, 1749–57 (2021), https:// www.healthaffairs.org/doi/abs/10.1377/ hlthaff.2021.00822?journalCode=hlthaff (finding that plans applied step therapy in 38.9 percent of drug coverage policies, with varying frequency across plans (20.6–57.5 percent); 34.0 percent were consistent with corresponding clinical guidelines, 55.6 percent were more stringent, and 6.1 percent were less stringent). 217 See, e.g., 42 U.S.C. 1396r–8(d). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 assess whether the rationale for the denial was based on impermissible discriminatory considerations. In its review, OCR may require a covered entity to provide the following information: its medical necessity standards or guidelines; the clinical, evidence-based criteria or guidelines 218 relied upon to make the medical necessity determination; and the medical substantiation for the medical necessity determination. As discussed previously, OCR will evaluate a covered entity’s assertion that its actions were based on legitimate, nondiscriminatory reasons to determine if it is pretextual. Medical necessity determinations that are not based upon general medical judgments or based on clinical, evidence-based criteria or guidelines may be considered evidence of pretext for discrimination. Similarly, as noted in the Proposed Rule, 87 FR 47872, we affirm that covered entities are not prohibited from using other reasonable medical management techniques, such as utilization management tools, when applied in neutral, nondiscriminatory manner and not otherwise prohibited under other applicable Federal and State law. Utilization management techniques include prior authorization,219 step therapy (or ‘‘failfirst’’),220 and durational or quantity limits.221 OCR shares commenters’ concerns about potentially discriminatory practices related to medical management techniques and the negative impacts of excessive utilization management. As such, when relying on 218 See also Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2023, 87 FR 27208, 27296–300 (May 6, 2022) (discussing newly promulgated 45 CFR 156.125(a), which states ‘‘[a] non-discriminatory benefit design that provides [EHB] is one that is clinically-based’’). 219 Medicare defines ‘‘prior authorization’’ as ‘‘the process through which a request for provisional affirmation of coverage is submitted to CMS or its contractors for review before the service is provided to the beneficiary and before the claim is submitted for processing.’’ 42 CFR 419.81 (Medicare definition of ‘‘prior authorization’’ for hospital outpatient department services). See also Ctrs. for Medicare & Medicaid Servs., Prior Authorization Process for Certain Hospital Outpatient Department (OPD) Services Frequently Asked Questions (FAQs), Q1 (Dec. 27, 2021), https://www.cms.gov/files/ document/opd-frequently-asked-questions.pdf. 220 Medicare defines ‘‘step therapy’’ for the Medicare Advantage Program as a ‘‘utilization management policy for coverage of drugs that begins medication for a medical condition with the most preferred or cost effective drug therapy and progresses to other drug therapies if medically necessary.’’ 42 CFR 422.2. 221 Durational or quantity limits place limits on the frequency or number of benefits to be provided, such as limiting therapy visits to once per week or limiting prescription drug coverage to a 30-day supply of a medication. PO 00000 Frm 00093 Fmt 4701 Sfmt 4700 37613 medical necessity requirements and other medical management techniques to deny coverage for a health service, covered entities must ensure that such tools are developed and applied in a neutral, nondiscriminatory manner. OCR would have concerns about guidelines that establish more restrictive requirements for certain diseases or conditions without a nondiscriminatory justification. In addition, OCR expects that limitations within such guidelines should be applied consistently with clinical standards within each patient population disease state, condition level, and diagnostic category to ensure equal clinical treatment across protected bases. That is, all patients diagnosed with a particular disease state must receive the same treatment that is deemed clinically appropriate, regardless of their race, color, national origin, sex, age, or disability. We affirm that excessive use or administration of utilization management practices that target a particular condition that could be considered a disability or other prohibited basis under section 1557 could be discriminatory under this rule. OCR declines to state in preamble or regulatory text that specific practices are per se discriminatory under section 1557. As discussed throughout this section, OCR must conduct a factspecific inquiry into allegations of discriminatory actions and consider a covered entity’s proffered reason for the challenged action. Comment: OCR received a number of comments discussing costs as a legitimate, nondiscriminatory reason for benefit designs under § 92.207(c). Commenters supported the rule allowing clinical evidence to support a benefit design and requested that OCR allow covered entities to use extraordinary costs as justification for certain benefit designs. Commenters stated that covered entities use utilization management controls, such as drug tiering, as part of their benefit design to keep coverage affordable. Commenters noted concerns that highcost drugs or other services could lead to health plans becoming insolvent if they are unable to apply utilization management controls where all treatments for a particular condition are high cost, particularly when they are expensive new drugs or gene therapies. Commenters argued that issuers and plans must retain some flexibility in their approach to covering and paying for high-cost drugs and services. Commenters expressed concern that § 92.207 would prohibit covered entities from having utilization management controls on all or most drugs or services E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37614 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations that treat a particular condition or disease, regardless of their cost, and asked OCR to affirm that placing all treatments for a certain disease or condition in one tier may not in fact be discriminatory by default, but rather an appropriate benefit design due to the high cost of those particular items or services. Conversely, other commenters asked OCR to clarify that covered entities cannot justify benefit designs that disfavor coverage for medically necessary services based on cost savings. Commenters noted that as costs of medications and therapies have increased, covered entities have significantly increased the use of utilization management, including adding arbitrary prior authorization processes not based in clinical evidence for new cancer therapies. They added that rare disease patients face the additional challenge of having no or few treatment alternatives if a preferred medication or therapy is not covered. Response: OCR reiterates that § 92.207 does not prohibit a covered entity from engaging in reasonable utilization management techniques applied in a neutral, nondiscriminatory manner and that are not otherwise prohibited under other applicable Federal and State law. As noted above, excessive use or administration of utilization management tools that target a particular condition that could be considered a disability or other prohibited basis could violate section 1557. Where there is an alleged discriminatory practice or action that is not based on a facially discriminatory policy, § 92.207(c) provides that the covered entity has the opportunity to provide a legitimate, nondiscriminatory reason for the practice. Covered entities are not restricted in what information they elect to provide to OCR as part of their justification for the challenged practice or action. OCR will carefully review a covered entity’s proffered reason to ensure it is not pretext for discrimination. OCR discussed previously that determinations on whether a particular benefit design feature is discriminatory, such as utilization management or drug tiering, will be made on a case-by-case basis. Accordingly, OCR declines to specify whether certain benefit design practices are per se discriminatory. Comment: One organization raised concerns that OCR is asserting de facto authority over the relationship between health insurance and medical care, and that OCR is asserting that it has authority under section 1557 to regulate the practice of medicine and the structure of health insurance coverage VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 according to its own determination of what is ‘‘appropriate’’ and ‘‘nondiscriminatory,’’ along with the authority to definitively determine what is, or is not, the current standard of medical care. The commenter further states that OCR may in the future assert and exercise similar claims of authority with respect to other medical practices, standards of care, or health insurance coverages. Response: As previously discussed throughout this preamble, section 1557 was intended to prohibit discrimination in health insurance coverage and other health-related coverage, as the statute’s plaint text makes apparent. Congress expressly granted the Secretary the authority to promulgate regulations to implement section 1557. 42 U.S.C. 18116(c). Therefore, OCR is acting within its statutory authority in promulgating this final rule to regulate health insurance coverage or other health-related coverage provided or administered by a recipient health insurance issuer or other covered entity. OCR disagrees with the commenter that this rule establishes a standard of medical care, or requires certain health insurance coverages. As specified in the preceding discussion, when assessing whether a challenged action was based on prohibited discrimination rather than on nondiscriminatory medical necessity standards, OCR will not conduct a general review of the medical judgment underlying the medical necessity determination, but rather will assess whether there is facial or other direct evidence of discriminatory intent or if a proffered rationale for the denial was pretext for discrimination. Further, this final rule does not require coverage of a particular health service; rather, it requires that the coverage being offered must be provided in a neutral and nondiscriminatory manner. Comment: Commenters stated that issuers should provide transparent information on coverage details, utilization management practices, denial rates, and reasons for denials. Specifically, a commenter requested that this section be strengthened by implementing a requirement for health plans to disclose medical necessity determinations when care or coverage is denied based on medical necessity to individual enrollees. The commenter further suggested that OCR adopt the approach in the MHPAEA final rule, requiring disclosure of medical necessity criteria to potential beneficiaries or enrollees and the reasons behind denials of coverage or reimbursement. Commenters emphasized that disclosure would help providers and consumers to identify and PO 00000 Frm 00094 Fmt 4701 Sfmt 4700 challenge discriminatory denials of medically necessary care, which can be difficult to do when data regarding the coverage they need either does not exist or the issuer holds the data on details of coverage, denial rates, and reasons for denial. Response: OCR agrees with commenters that transparency about medical management policies and coverage determinations and denials is useful information for the public, and we encourage issuers to disclose such information to all enrollees. OCR considered requiring issuers to affirmatively disclose certain plan information to the public, but we decline to do so at this time. We have determined that placing a transparency requirement on health insurance issuers covered under section 1557 would not be helpful on issuers if required in every situation, and because the scope and application of section 1557 is broader than, and imposes different requirements from, MHPAEA. We stress that OCR has the authority to request and receive information from a covered entity on the details of coverage, medical management policies, denial rates, and reasons for denials, among other things, when necessary to determine compliance with section 1557.222 In addition, we note that appeals processes that subject individuals protected by section 1557 to excessive administrative burdens in accessing coverage benefits that other enrollees are not required to navigate when accessing coverage may be discriminatory under section 1557. Comment: OCR received many comments on the use of value assessment methods in benefit design and pricing and coverage decisions, and their impacts on treatments for people with disabilities and older adults, particularly in access to prescription drugs and benefit design. Commenters suggested that some payers use these assessment methods to steer patients away from newer or more innovative treatments to less effective options. Commenters on this issue appreciated OCR’s recognition in the Proposed Rule that these methods can have discriminatory impacts, though commenters did not provide uniform input about how to address these impacts. Several commenters called for increased oversight of value assessment methods by OCR, and some called on OCR to ban the use of the quality222 45 CFR 92.303 (section 1557); 80.6 (title VI); 84.61 (section 504, incorporating title VI’s § 80.6); 86.71 (title IX, incorporating title VI’s § 80.6); 91.34 (Age Act). E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 adjusted life year (QALY) framework and similar methods. Commenters supporting a ban on the use of QALYs stated that these methods are inherently discriminatory because they assign a lesser numerical value to extending the lives of people with disabilities and older adults compared to people without disabilities or younger persons, especially when applied to benefit design or access to prescription drugs.223 Response: OCR recognizes that value assessment methods can be helpful tools in making decisions in various contexts within health care and are used widely. The use of value assessment methods that result in discrimination on the basis of race, color, national origin, age, disability and sex are prohibited under section 1557’s general mandate of nondiscrimination. That is, where a value assessment uses methods that penalize patients or groups of patients on a ground protected by section 1557 and where such methods then result in limiting access to an aid, benefit, or service, they may violate section 1557. In response to commenters, we note that value assessment tools cannot be used to, to deny or afford an unequal opportunity to qualified individuals with disabilities or on the basis of age with respect to the eligibility or referral for, or provision or withdrawal of any aid, benefit, or service, including the terms or conditions under which they are made available. We further note that methods of value assessment are permissible so long as they do not discriminate in discounting the per-year value of life extension on the basis of age or disability under section 1557. In addition, OCR has proposed a prohibition against the discriminatory use of value assessment methods in pending rulemaking under section 504. 88 FR 63409. Proposed § 84.57, which applies to recipients of Federal financial assistance from HHS, prohibits, directly or through contractual, licensing, or other arrangements, using any measure, assessment, or tool that discounts the value of life extension on the basis of 223 These concerns were also highlighted in testimony at a recent Congressional hearing on proposed legislation to ban the use of QALYs in all Federal health programs. See Lives Worth Living: Addressing the Fentanyl Crisis, Protecting Critical Lifelines, and Combatting Discrimination Against Those with Disabilities: Hearing on H.R. 467, H.R. 498, H.R. 501, and H.R. 485 Before the Subcomm. on Health of the H. Comm. on Energy & Com., 118th Cong. (2023) (statement of Kandi Pickard, President & CEO, Nat’l Down Syndrome Society), https:// d1dth6e84htgma.cloudfront.net/Witness_ Testimony_Pickard_HE_02_01_2023_ 065c903370.pdf?updated_at=2023-0130T21:38:38.787Z (speaking on her support of Protecting Health Care for All Patients Act, H.R. 485, 118th Cong. (2023)). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 disability to deny or afford an unequal opportunity to qualified individuals with disabilities with respect to the eligibility or referral for, or provision or withdrawal of any aid, benefit, or service, including the terms or conditions under which they are made available. Given that many different measures exist for use in value assessment and may be applied in different ways, this discussion applies to evaluating any value assessment methodology rather than commenting on specific measures at this time. However, we appreciate the concerns raised by the commenters and will take them into account as OCR proceeds with future work on value assessment. Comment: Many comments on value assessment also requested further development of new value assessment measures and the incorporation of input from patients with disabilities (and, per some commenters, their family members and providers) into value assessment schema. Commenters urged the Department to support the development and dissemination of these methodologies. Another commenter noted that cultural barriers existed in institutions that prevented the adoption of new metrics. Response: OCR appreciates commenters’ input and encourages and supports the development of such metrics and the incorporation of input from people with disabilities and other interested groups protected under section 1557, as reflected in research priorities elsewhere in the Department. Numerous research and grantmaking initiatives from the National Institutes of Health (NIH) and the National Institute on Disability, Independent Living, and Rehabilitation Research (NIDILRR) support this and similar efforts.224 In addition, OCR notes that the National Council on Disability issued an updated policy brief released in November 2022.225 224 Funding Opportunity Announcement, U.S. Dep’t of Health & Hum. Servs., Nat’l Insts. of Health, NIH Faculty Institutional Recruitment for Sustainable Transformation (FIRST) Program: FIRST Cohort (U54 Clinical Trial Optional) (December 8, 2020), https://grants.nih.gov/grants/ guide/rfa-files/RFA-RM-20-022.html; U.S. Dep’t of Health & Hum. Servs., Adm. for Cmty. Living, Disability and Rehabilitation Research Projects (DRRP) Program, https://acl.gov/programs/researchand-development/disability-and-rehabilitationresearch; U.S. Dep’t of Health & Hum. Servs., Nat’l Insts. of Health, All of Us Research Program, https://allofus.nih.gov/. 225 Nat’l Council on Disability, Alternatives to QALY-Based Cost-Effectiveness Analysis for Determining the Value of Prescription Drugs and Other Health Interventions (2022), https:// www.ncd.gov/report/alternatives-to-qaly-basedcost-effectiveness-analysis-for-determining-the- PO 00000 Frm 00095 Fmt 4701 Sfmt 4700 37615 Benefit Design Analysis The comments and our responses regarding benefit design are set forth below. In the Proposed Rule, we discussed that OCR will apply basic nondiscrimination principles to the facts of the particular plan or coverage when analyzing allegations of discrimination under this section to determine if the challenged action is unlawful. We discussed that, consistent with general principles in civil rights law, covered entities will have the opportunity to articulate a legitimate, nondiscriminatory justification for an alleged discriminatory action or practice, and that OCR will scrutinize the justification to ensure it is not a pretext for discrimination. Comment: Some commenters requested that OCR provide additional guidance explaining how it intends to investigate potential violations by health programs or activities engaged in providing or administering health insurance coverage or other healthrelated coverage and to ensure ongoing compliance with Federal law. Commenters urged OCR to establish clear, predictable standards that covered entities can rely upon when designing their plans and that will ensure OCR’s ‘‘case-by-case’’ analysis does not result in only retroactive reviews of existing plans or lead to arbitrary results. Another commenter noted that if OCR will not provide presumptively discriminatory benefit design examples, OCR should provide more information to educate covered entities about what OCR interprets to be best practices other than the information, corrective plans, and resolution agreements it stated it would publish on its website in the 2016 Rule. The commenter urged OCR to publicly publish deidentified information on each and every investigation that it pursues, including the specific actions purported to be discriminatory by a covered entity, the alleged basis of discrimination, and OCR’s resolution of the complaint so that covered entities can educate themselves on best practices and actions that OCR may deem to be discriminatory. Response: We appreciate the comments requesting further specificity regarding OCR’s analysis when investigating potential violations under this section. We agree that providing clarity to covered entities promotes compliance and reduces prohibited discrimination. Each potentially discriminatory action involves unique value-of-prescription-drugs-and-other-healthinterventions/. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37616 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations facts and circumstances that must be independently investigated on a caseby-case basis before OCR can determine whether a challenged action is considered discriminatory under this section, particularly considering that each covered entity’s reason for engaging in the challenged action may be specific to that covered entity and the circumstances surrounding its decision process. For example, when determining whether a challenged design feature is discriminatory, OCR considers the benefit design of the plan as a whole, whether similar limitations or restrictions are placed on other types of health services, and whether the covered entity consistently relies on neutral, nondiscriminatory criteria when developing the design feature, among other things. Therefore, OCR reaffirms the investigative approach set forth in the Proposed Rule, 87 FR 47875, whereby OCR’s determination of whether a challenged action is discriminatory is necessarily a factspecific, case-by-case analysis dependent on the facts of the particular situation. When analyzing whether an action violates this section, OCR will apply basic nondiscrimination principles to the facts of the particular health insurance coverage or other health related coverage, consistent with civil rights case law. This includes the opportunity for covered entities to articulate a legitimate, nondiscriminatory justification for an alleged discriminatory action, which OCR will scrutinize to ensure it is not a pretext for discrimination. Where a covered entity’s justification relies upon medical standards or guidelines, we note that such standards or guidelines may be subject to additional scrutiny if they are not based on clinical, evidencebased criteria or guidelines. For more information related to OCR’s consideration of a covered entity’s legitimate, nondiscriminatory reason, please see previous discussion under § 92.207(c). OCR reiterates that this rule does not require a covered entity to provide coverage for any particular health service in its health insurance coverage or other health-related coverage when provided in a nondiscriminatory manner; however, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide the health service to all individuals in a neutral, nondiscriminatory manner consistent with this rule. Regarding our analysis when investigating potential discrimination in the benefit design of excepted benefits and short-term, limited duration VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 insurance (STLDI), we provide additional information below in the discussion under this section on Scope of Application to Health Insurance and Health-Related Coverage (Including Excepted Benefits and STLDI). OCR acknowledges that the nature of our complaint-driven investigative process results in OCR reviewing existing plans and making determinations on the benefit designs of existing plans. However, OCR’s case-bycase analysis is necessary in order to consider the fact-specific nature of each challenged action and to apply relevant case law to each situation. OCR investigates each allegation in a consistent manner and treats all complainants and covered entities evenly. We appreciate commenters’ suggestions to provide more information to educate covered entities about what OCR interprets to be best practices; OCR will consider issuing such guidance in the future. To educate both the public and covered entities, OCR posts its resolution agreements on its website and issues press releases when cases are resolved, and we intend to continue this practice. Comment: Commenters recommended that OCR specify in the final rule that a nondiscriminatory benefit design is one that is clinically based. While expressing support for OCR considering clinical guidelines and standards of care when evaluating plan benefit designs, these same commenters also cautioned that OCR should not exclusively rely on clinical guidelines and journal articles in its analysis of discriminatory design because clinical guidelines may perpetuate racial bias and health disparities, and entities could cite a single peer-reviewed article as a shield to escape valid claims of discriminatory benefit design. Response: An analysis of whether a benefit design is discriminatory under this rule is a fact-specific inquiry that will be made in accordance with general civil rights principles and applicable case law. As discussed under § 92.207(c), covered entities may provide a legitimate, nondiscriminatory reason as a defense to a potentially discriminatory coverage determination. A covered entity has latitude to submit any legitimate reason for its actions as long as it is not discriminatory or pretext for discrimination. However, if the justification given is not based on clinical, evidence-based criteria or guidelines, OCR will consider that evidence of pretext. When a covered entity submits a justification that relies upon medical standards or guidelines, OCR may conduct additional PO 00000 Frm 00096 Fmt 4701 Sfmt 4700 investigation to ensure the justification is not pretextual, including a review on whether the standards or guidelines are or are not based on clinical, evidencebased criteria or guidelines. OCR’s review of a covered entity’s justification will not rely solely on a covered entity’s provision of one piece of literature but will consider a variety of factors, as discussed in detail above under §§ 92.206(c) and 92.207(c). We further note that OCR will not conduct a general medical review of the medical judgment undergirding the determination. Comment: Commenters noted that OCR could ensure higher quality health care for all enrollees through stronger oversight and regulation. These commenters urged OCR not to rely solely on complaints and to engage in proactive oversight by affirmatively reviewing covered entities’ plan designs. Response: We agree that robust enforcement of section 1557 is critical to ensure individuals’ ability to receive medically necessary health services, unencumbered by discriminatory conduct. OCR will employ all available means of investigating health insurance coverage and other health-related coverage under this rule, including through compliance reviews and complaint investigations. Comment: Commenters requested that OCR clarify how it will coordinate with State and Federal agencies that establish specific plan requirements and approval processes. Commenters noted that many facets of benefit design are heavily regulated by other agencies within the Department, including CMS’ regulation of nondiscriminatory plan design in EHB and qualified health plans, retail pharmacy network adequacy of Medicare Part D plans, and benefit coverage requirements under Medicare Advantage and Medicaid. Commenters suggested that OCR should not enforce a discrimination claim if the underlying design is accepted by the plan’s regulator and should defer enforcement action to existing review processes where appropriate. Some commenters also suggested that the Department should establish a safe harbor for health insurance issuers to comply with section 1557 in cases where there are State law interactions to avoid creating multiple or duplicative standards. Response: OCR acknowledges commenters’ concerns about harmonization in the regulation and enforcement of benefit design requirements across State and Federal laws. We note that covered entities offering health insurance coverage and other health-related coverage, such E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Medicaid or qualified health plans in the Exchanges, are subject to a host of other laws and regulations, at both the State and Federal level. OCR does not view a covered entity’s compliance with other State or Federal laws, which were adopted under different requirements and for different purposes, to be determinative in all cases of a covered entity’s compliance with section 1557, unless otherwise specified in this rule.226 OCR commits to coordinating with other Federal agencies as appropriate to avoid inconsistency and duplication in enforcement efforts and will consider issuing guidance in coordination with other agencies, such as CMS, after publication of the rule. We will give consideration to a covered entity’s compliance with other Federal laws when those requirements overlap with section 1557’s requirements and will work closely with covered entities when compliance with this final rule requires additional action. That said, as the lead enforcement agency for section 1557, OCR maintains sole authority to determine a covered entity’s compliance with this final rule. Comment: Commenters requested clarity on which covered entity is liable for potentially discriminatory plan benefit designs when several covered entities provide or administer elements of the benefit design. Commenters requested that OCR state that all entities, including third party administrators, benefits advisers, and consultants, that participate in discriminatory plan design with respect to group or individual insurance plans are covered entities under section 1557. A commenter requested that benefits advisers or consultants working with employers to design self-funded group health plans specifically should be considered a covered entity presumptively where the employer, the plan, or the third party administrator receives Federal financial assistance. The commenter noted concern that such advisers and consultants are a driving force behind discriminatory plan design and should be put on notice that their conduct is subject to section 1557 in many circumstances. A commenter requested that OCR make clear that any entity itself covered by section 1557 violates the statute by outsourcing the implementation or design of discriminatory plans to entities that might themselves not be covered by the statute. Response: OCR clarifies that in situations where multiple covered 226 E.g., 45 CFR 92.203, which requires covered entities to comply with certain accessibility requirements in the ADA. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 entities provide or administer elements of a discriminatory benefit design, all of the entities may be found liable under section 1557. In the discussion of the definition of ‘‘Federal financial assistance’’ in § 92.4, we explained that both the direct recipient and subrecipient (or subcontractor) are responsible for complying with applicable civil rights laws. We also note that covered entities are responsible for the conduct of their subcontractors and cannot outsource or contract away their civil rights obligations by entering into contractual arrangements with subcontractors. The responsibility of third party administrators is discussed later in this section. As noted, this final rule does not apply to employment practices. See § 92.2(b). Comment: Commenters expressed concern that the proposed regulation may unintentionally limit covered entities’ ability to develop effective programs and initiatives to close care gaps and address unique needs to reduce health disparities. Commenters explained that they currently conduct individual outreach to members of a subgroup through care management processes, invest in social determinants of health interventions, tailor marketing to subgroups to address particular health concerns, provide plans that restrict enrollment to special needs individuals with specific chronic conditions, and develop targeted quality programs and chronic care management programs to reduce health disparities for their members. A commenter noted that issuers take those actions to more efficiently provide care to particularly vulnerable populations without an intent to discriminate. Another commenter noted that if health plans are required to provide services that address chronic care, social determinants of care, or other similar programs ‘‘equally’’ to all enrollees rather than ‘‘equitably’’ target services to those in need based on health or socioeconomic condition, plans will be limited in their ability to provide appropriate services and scale and sustain these programs. To address these concerns, commenters requested that OCR clarify in the final rule that actions taken to reduce health disparities and those designed to improve health for specific populations are not discriminatory for purposes of section 1557. Commenters also recommended that OCR consider an approach similar to language in the Department’s Group Health Insurance Market regulations prohibiting prohibition on discrimination based on health status that explicitly permits PO 00000 Frm 00097 Fmt 4701 Sfmt 4700 37617 group health plans and health insurance issuers to treat individuals with adverse health conditions more favorably. 45 CFR 146.121(g).227 Response: We appreciate commenters raising this concern and applaud efforts to mitigate and address health disparities. Nothing in this rule prohibits programs designed to improve health outcomes for specific populations so long as the programs do not discriminate on the basis of race, color, national origin, age, sex, or disability. For example, programs could be developed using social determinants of health or other metrics that serve to identify underrepresented individuals that are not based on protected bases under section 1557. To illustrate, a ‘‘Special Needs Plan’’ is a specialized Medicare Advantage coordinated care plan that exclusively enrolls ‘‘special needs individuals,’’ who are not limited to individuals with disabilities, and do not violate section 1557.228 In addition, covered entities are permitted and encouraged to develop programs that address health disparities related to a person’s age. Under the Age Act and section 1557, age distinctions in programs that provide special benefits to older adults or children are permitted. 45 CFR 91.17 (Age Act); 92.101(b)(1) (section 1557, incorporating 45 CFR 91.17). Scope of Application to Health Insurance Coverage and Other HealthRelated Coverage (Including Excepted Benefits and STLDI) In the 2022 NPRM, we sought comment on excepted benefits and short-term, limited-duration health insurance (STLDI), and the Proposed Rule’s application to these products. Consistent with the definition of ‘‘health program or activity’’ under § 92.4, we proposed that the rule would apply to all the operations of any covered entity principally engaged in the provision or administration of health insurance coverage or other health-related coverage. 87 FR 47875–76.229 As an example, we explained that an issuer participating in the Exchange and thereby receiving Federal financial assistance would be covered by the rule for its qualified health plans offered on the Exchange, as well as for its health 227 In this final rule, we cite to HHS regulations, but note that the Departments of Labor and the Treasury have parallel regulatory citations. 228 See sections 1859(b)(6), 1859(f)(2)–(4) of the Social Security Act (42 U.S.C. 1395w–28(b)(6), (f)(2)–(4)). 229 However, per § 92.2(b), this rule does not apply to employers with regard to their employment practices, including the provision of employee health benefits. E:\FR\FM\06MYR4.SGM 06MYR4 37618 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations plans offered outside the Exchange, including, for example, large group market plans,230 grandfathered plans,231 grandmothered plans,232 excepted benefits,233 and STLDI,234 as well as for its operations related to acting as a third party administrator for self-insured group health plans. 87 FR 47876. The comments and our responses regarding the scope and application to all operations of a covered health insurance issuer and to excepted benefits and STLDI specifically are set forth below. Comment: Several commenters, including those representing the health insurance industry and some State insurance regulators, raised concerns about how the Proposed Rule’s application to all operations of a recipient health insurance issuer would result in covering an issuer’s other operations and lines of business that do not receive Federal financial assistance, including, for example, plans sold off the Exchange, grandfathered plans, grandmothered plans, employer plans, excepted benefits, STLDI, third party 230 42 U.S.C. 300gg–91(e)(3); 45 CFR 144.103. U.S.C. 18011; 45 CFR 147.140. 232 Grandmothered plans are certain nongrandfathered health insurance coverage in the individual and small group market that are not considered to be out of compliance with certain specified market reforms under certain conditions. See U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Extended NonEnforcement of Affordable Care Act-Compliance With Respect to Certain Policies (Mar. 23, 2022), https://www.cms.gov/files/document/extensionlimited-non-enforcement-policy-through-calendaryear-2023-and-later-benefit-years.pdf. 233 42 U.S.C. 300gg–21(b), 300gg–63, and 300gg– 91(c); 45 CFR 144.103, 146.145(b), and 148.220(b). The Departments of HHS, Labor, and the Treasury share interpretive jurisdiction over the definition of ‘‘excepted benefits’’. We cite to HHS regulations but note that the Departments of Labor and the Treasury have parallel statutory and regulatory citations. 234 Short-term limited duration insurance is a type of health insurance coverage that is generally exempt from the provisions of title XXVII of the PHS Act because it is specifically excluded from the definition of ‘‘individual health insurance coverage’’ in the PHS Act. See 42 U.S.C. 300gg– 91(b)(5). Short-term limited duration insurance is currently defined in Federal regulations as health insurance coverage issued under a contract that is effective for less than 12 months, and, taking into account renewals or extensions, has a duration of no longer than 36 months in total. 45 CFR 144.103. Short-term limited duration insurance is defined by the Departments of HHS, Labor, and the Treasury (Tri-Departments). The Tri-Departments issued a Notice of Proposed Rulemaking on Short-Term, Limited-Duration Insurance; Independent, Noncoordinated Excepted Benefits Coverage; and Tax Treatment of Certain Accident and Health Insurance that would revise the definition of ‘‘Short-Term Limited-Duration Insurance’’ to limit the length of the initial contract period to no more than three months and the maximum coverage period to no more than four months, taking into account any renewals or extensions. 88 FR 44596 (July 12, 2023). In this final rule, we cite to HHS regulations, but note that the Departments of Labor and the Treasury have parallel regulatory citations. ddrumheller on DSK120RN23PROD with RULES4 231 42 VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 administrator activities and pharmacy benefit manager activities. Commenters noted that these plans are treated separately under the ACA and are not subject to some or all of the ACA’s health insurance market reforms. Commenters suggested that plans that do not receive Federal financial assistance should not be subject to section 1557. Comments about particular types of plans are discussed in turn below. Commenters argued the Proposed Rule’s application was too broad and went beyond Congressional intent and urged OCR to retain the 2020 Rule’s approach that the rule cover a health insurance issuer’s operations only to the extent the operations directly receive Federal financial assistance. In addition, commenters argued that applying the rule to a covered issuer’s operations that do not receive Federal financial assistance would create an unlevel playing field among health insurance issuers that accept Federal funding and those that do not, placing those that receive Federal funding at a competitive disadvantage. For example, commenters stated that issuers that do not receive Federal financial assistance may underwrite excepted benefits or STLDI by age or sex, or exclude higher cost health care services, which may result in non-covered entities offering lower-cost coverage to a pool of individuals whose coverage is less costly, while the pool of individuals under a covered entity’s coverage could be costlier, leading to higher premiums. Commenters also argued that covered entities would be subject to increased compliance costs to which competitors are not subject. For example, these commenters stated that compliance with the rule’s nondiscrimination notices would result in tremendous costs to which non-covered entities are not subject. Some commenters argued that this competitive disadvantage could discourage issuers from participating in the Exchanges. A few commenters that supported the proposed application to all an issuer’s operations also raised concerns that the rule would create an unlevel playing field that would disadvantage plans that support Federal programs like Medicare and Medicaid while giving an unfair competitive advantage to competitors that are not required to comply with nondiscrimination requirements. To level the playing field, these commenters and others suggested that OCR work with other Federal agencies and develop a tri-Department rule with the Departments of Labor and the Treasury to subject all health plans to PO 00000 Frm 00098 Fmt 4701 Sfmt 4700 similar nondiscrimination and accessibility requirements. A number of commenters, including some members of Congress, supported the broad application of the rule to an issuer’s other operations and argued the 2020 Rule’s approach is contrary to Congress’s intent in passing the ACA to prohibit discrimination in health care. Commenters argued that a private insurance company receiving financial assistance from the Federal Government should not be allowed to engage in discriminatory practices in its other lines of business. Commenters observed that issuers offering plans that receive Federal financial assistance, such as qualified health plans or Medicare Advantage plans, often also offer plans that do not receive Federal financial assistance. Noting that many of these other types of plans are not currently subject to any or all nondiscrimination requirements under the ACA’s health insurance market reforms, these commenters argued that the Proposed Rule’s broad application will increase protections from discriminatory practices for individuals enrolled in those plans. Response: OCR appreciates the concerns raised by some commenters regarding the Proposed Rule’s application to all operations of a recipient health insurance issuer; however, these concerns do not abrogate a recipient’s obligation to comply with section 1557. Under the definition of ‘‘health program or activity’’ at § 92.4, a recipient of Federal financial assistance that is principally engaged in the provision or administration of health insurance coverage or other healthrelated coverage is covered under this rule for all of its operations. Section 1557 applies to ‘‘any health program or activity, any part of which is receiving Federal financial assistance,’’ 42 U.S.C. 18116(a) (emphasis added). As we explain in detail under the discussion of the definition of ‘‘health program or activity’’ in § 92.4, it is reasonable to infer that Congress intended the term ‘‘health program or activity’’ to be interpreted broadly and to include all of that entity’s operations if the entity that receives Federal funding is principally engaged in the provision or administration of health insurance coverage or other health-related coverage.235 235 See, e.g., Fain v. Crouch, 545 F. Supp. 3d 338, 342–43 (S.D.W. Va. 2021) (finding ‘‘‘health program or activity’ under Section 1557 necessarily includes health insurance issuers’’ and holding that defendant health plan was, ‘‘by virtue of its acceptance of federal assistance under its Medicare Advantage program,’’ required to comply with section 1557 ‘‘under its entire portfolio’’), rehearing E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations In response to comments that this obligation might cause a competitive disadvantage with entities that do not accept Federal funds, this obligation is consistent with statutory text as set forth by Congress, as discussed above. Further, the risk of competitive disadvantage is low given that the majority of health insurance issuers offer some type of product that receives Federal financial assistance, such as Medicare Advantage plans, Medicare Part D prescription drug plans, Medicaid managed care plans, and qualified health plans through the Exchanges.236 In any event, by accepting the benefit of Federal funds, a recipient is prohibited from discriminating in its health programs and activities under section 1557, as discussed previously under the definition of ‘‘health program or activity.’’ Any recipient of Federal financial assistance from the Department is subject to this same requirement and prohibited from discriminating in its health programs and activities, including all of its operations when principally engaged, as set forth in this final rule. Section 1557 does not authorize OCR to require a health plan or insurance issuer not otherwise subject to section 1557 to comply with the statute. Whether the Department could issue a rule, under different authority, with the Departments of Labor and the Treasury, to apply similar nondiscrimination and accessibility standards to all health plans or health insurance issuers, is outside the scope of this rule. We further address comments about particular types of plans and their coverage under this final rule in various comment responses below. Comment: Some commenters requested that grandfathered and grandmothered plans should be exempt from the rule because they are not subject to many of the ACA’s provisions. These plans benefit consumers, commenters stated, by allowing them to maintain affordable existing coverage as long as it continues to meet their needs. Commenters argued that applying section 1557 to these plans would be inconsistent with the longstanding regulatory treatment of the plans. Further, commenters argued that the costs of complying with section 1557, including but not limited to notice and tagline requirements, could result en banc granted, No. 22–1927 (4th Cir. Apr. 12, 2023) (oral argument held Sept. 21, 2023) (argued with Kadel v. Folwell, No. 22–1721). 236 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medical Loss Ratio Data and System Resources (2022), https:// www.cms.gov/CCIIO/Resources/Data-Resources/ mlr. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 in increased costs for issuers, which would be passed on to consumers, and could lead to a decision to discontinue plans. Response: OCR understands commenters’ concerns and acknowledges that grandfathered and grandmothered plans are not subject to many of the ACA’s provisions. However, the statutory text of the grandfathered health plan provision 237 indicates that Congress did not intend to exclude them from dection 1557. The statute sets forth the specific provisions of the PHS Act that apply to grandfathered plans and then provides that except for those provisions, ‘‘this subtitle and subtitle A (and the amendments made by such subtitles) shall not apply’’ to grandfathered plans. 42 U.S.C. 18011(a)(2). ‘‘This subtitle’’ refers to subtitle C of title I of the ACA, while ‘‘subtitle A’’ refers to subtitle A of title I of the ACA, both of which contain market reforms. Section 1557 is in subtitle G of title I of the ACA and therefore is not one of the subtitles that Congress specified should not apply to grandfathered health plans. Grandmothered plans 238 were not established in the ACA or the PHS Act; they are not exempt from the ACA or the PHS Act by statute or regulation. Rather, CMS specified that it will not take enforcement actions against grandmothered plans that are out of out of compliance with certain specified ACA market reforms under certain conditions (CMS Non-Enforcement Policy).239 The CMS Non-Enforcement 237 Grandfathered health plans were established by Congress in title I of the ACA to permit the continuation of coverage for certain plans in effect as of the date of enactment of the ACA (March 23, 2010) in which individuals were enrolled at that time. 42 U.S.C. 18011; 45 CFR 147.140. Grandfathered health plans are statutorily subject to only certain market reforms in the ACA, 42 U.S.C. 18011(a)(3)–(5), and thus are not subject to certain market reforms related to nondiscrimination, such as fair health insurance premiums and EHB. To maintain grandfathered status, plans cannot make certain changes to the terms of the plan or coverage. Specifically, certain changes to benefits, costsharing requirements, and contribution rates will cause a plan or coverage to relinquish its grandfather status. 238 Grandmothered plans are certain nongrandfathered health insurance coverage in the individual and small group market that are not considered to be out of compliance with certain specified market reforms under certain conditions, including those related to nondiscrimination, such as fair health insurance premiums, the prohibition of preexisting condition exclusions or other discrimination based on health status with respect to adults (except with respect to group coverage), the prohibition of discrimination based on health status (except with respect to group coverage), and EHB. 239 See U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Extended NonEnforcement of Affordable Care Act-Compliance With Respect to Certain Policies (Mar. 23, 2022), PO 00000 Frm 00099 Fmt 4701 Sfmt 4700 37619 Policy has been in place since 2013 240 and has provided relief from the same ACA market reform provisions continuously since that time.241 Section 1557 has never been one of the provisions for which enforcement relief was provided; therefore, grandmothered plans are not exempt from section 1557. When offered by a recipient health insurance issuer, grandfathered and grandmothered plans would be covered under the rule as part of the issuer’s operations when the issuer is principally engaged in the business of providing or administering health insurance coverage or other healthrelated coverage. If OCR were to receive a complaint about a grandfathered plan or grandmothered plan, OCR would carefully consider the facts and circumstances of the challenged action or practice. As discussed throughout this section, the health insurance issuer may provide a legitimate, nondiscriminatory reason for the action or practice. Further, in cases of alleged disability discrimination, covered entities may also prove that modifying a plan to comply with section 1557 would result in a fundamental alteration to their health program or activity. Comment: A commenter requested clarification on how the rule would apply to Medicare Employer Group Waiver Plan (EGWP) participants. Response: EGWPs are types of Medicare Part C (Medicare Advantage) plans 242 or Medicare Part D prescription drug plans 243 that qualify for waivers of certain Medicare regulations because they are offered exclusively to the employees, former employees, members or former members of an employer, union or labor organization, or the trustees of a fund established by one or more employers or labor organizations (or combination thereof). Entities that receive funding through the Department’s Medicare Part C or Medicare Part D program are subject to the rule as recipients of Federal financial assistance. This includes entities providing Medicare https://www.cms.gov/files/document/extensionlimited-non-enforcement-policy-through-calendaryear-2023-and-later-benefit-years.pdf. 240 See Letter from Gary Cohen, Director, Ctr. for Consumer Info. & Ins. Oversight, Ctrs. for Medicare & Medicaid Servs., to Insurance Commissioners (Nov. 14, 2013), https://www.cms.gov/cciio/ resources/letters/downloads/commissioner-letter11-14-2013.pdf. 241 See U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Extended NonEnforcement of Affordable Care Act-Compliance With Respect to Certain Policies (Mar. 23, 2022), https://www.cms.gov/files/document/extensionlimited-non-enforcement-policy-through-calendaryear-2023-and-later-benefit-years.pdf. 242 42 U.S.C. 1395w–27(i); 42 CFR 422.106. 243 42 U.S.C. 1395w–132(b); 42 CFR 423.458. E:\FR\FM\06MYR4.SGM 06MYR4 37620 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 Advantage plans or Medicare Part D plans, including EGWPs, or qualified retiree prescription drug plans (as defined at 42 CFR 423.882) (also known as RDS plans). Because employers and other plan sponsors are not subject to this rule with regard to their employment practices, pursuant to § 92.2(b), an employer or other plan sponsor would not be liable for discrimination related to these plans under this rule. This applies even if an employer directly contracts with CMS to offer a Medicare Advantage or Part D plan as an EGWP and receives Federal financial assistance for that EGWP.244 In circumstances where an employer offers an ‘‘800 series’’ EGWP through a Medicare Advantage organization or Part D plan sponsor,245 the health insurance issuer or entity offering the EGWP would be subject to the rule for the EGWP plan due to receipt of either Medicare Part C or Part D funding. Comment: One commenter requested clarification as to whether self-funded non-Federal Governmental plans, such as municipal plans, that opt out of certain Federal market reforms are covered under this rule if they receive funds from the Department directly or indirectly. Response: A self-funded non-Federal Governmental plan is a governmental plan established or maintained by a non-Federal Governmental agency, such as a State, county, school district, or municipality, for its employees.246 As with any other type of group health plan coverage, a non-Federal Governmental plan would be subject to this rule if it directly or indirectly receives Federal 244 CMS may contract directly with an employer, union or labor organization, or the trustees of a fund established by one or more employers or labor organizations (or combination thereof) for the entity to offer a Medicare Advantage plan or Part D plan to its employees, former employees, members or former members. 42 U.S.C. 1395w–28(i) and 1395w–132(b); 42 CFR 422.106(d) and 423.458(c). 245 In these situations, a Medicare Advantage organization or a Part D plan sponsor contracts with CMS to offer the Medicare health or drug plan and separately contracts with the employer, union or labor organization, or trustee of a fund established by one or more employers or labor organizations (or combination thereof) for the Medicare Advantage organization or Part D plan sponsor to offer an EGWP. For more information about direct contract and ‘‘800 series’’ EGWPs, see generally U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medicare Managed Care Manual, Chapter 9—Employer/Union Sponsored Group Health Plans (2013), https://www.cms.gov/ Regulations-and-Guidance/Guidance/Manuals/ Downloads/mc86c09.pdf. 246 42 U.S.C. 300gg–91(d)(8)(A)–(C); 45 CFR 144.103. For more information on self-funded, nonFederal Governmental plans, see U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Self-Funded, Non-Federal Governmental Plans, https://www.cms.gov/CCIIO/ Programs-and-Initiatives/Health-Insurance-MarketReforms/nonfedgovplans. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 financial assistance from the Department. The non-Federal Governmental agency sponsoring the employee health benefit plan would be excluded from liability under this rule an employer or plan sponsor, as applicable, pursuant to § 92.2(b). Comment: Commenters requested that the rule clarify when group health plans are subject to the rule. Response: A group health plan is subject to this rule if it is a recipient (or subrecipient) of Federal financial assistance as set forth under § 92.2(a)(1). We address the rule’s applicability to group health plans in more detail in the discussion above under §§ 92.1 (Applicability) and 92.4 (definition of ‘‘health program or activity’’). Comment: Several commenters expressed concerns with the rule’s proposed application to excepted benefits as part of a covered health insurance issuer’s operations and urged OCR to exclude excepted benefits from the rule. Commenters argued that the rule’s coverage of excepted benefits is inconsistent with Congressional intent and likely subject to legal challenge. These commenters explained that excepted benefits are statutorily defined benefits that Congress has long recognized as distinct from traditional health insurance coverage by excluding them from health insurance and group health plan coverage mandates under the PHS Act, ERISA, and the Internal Revenue Code, as long as they meet certain requirements.247 Commenters argued that the ACA retained this exclusion and that Congress therefore intended excepted benefits to be excluded from the ACA. To further demonstrate Congressional intent to exclude excepted benefits, commenters stated that since Congress first recognized excepted benefits in 1996 as part of HIPAA by incorporating their provisions into the PHS Act, ERISA, and the Internal Revenue Code, Congress has had several opportunities to redefine excepted benefits or to impose new requirements on them in subsequent laws, including the ACA, but it has not chosen to do so.248 While acknowledging that section 1557 does not explicitly exclude excepted benefits, commenters asserted that OCR cannot use its regulatory 247 Title XXVII of the PHS Act; part 7 of ERISA; chapter 100 of the Internal Revenue Code. 248 For example, the Mental Health Parity Act of 1996; Newborns’ and Mothers’ Health Protection Act of 1996 (NMHPA); Genetic Information Nondiscrimination Act of 2008 (GINA); Paul Wellstone and Pete Domenici Mental Health Parity and Equity Additional Act of 2008 (MHPAEA); Michelle’s Law (2008); ACA (2010); and No Surprises Act (2020). PO 00000 Frm 00100 Fmt 4701 Sfmt 4700 authority to impose new requirements that are inconsistent with the carefully crafted statutory provisions governing excepted benefits where Congress has clearly chosen not to do so. As support, commenters cited to Central United Life v. Burwell, 827 F.3d 70 (D.C. Cir. 2016). Commenters stated the court in Central United struck down a Department rule that revised the requirements related to fixed indemnity excepted benefit insurance in the individual market as an unconstitutional exercise of regulatory authority because the ACA maintained the HIPAA excepted benefit exemption for these benefits and the law did not authorize the Department’s proposed requirement. Central United, commenters argued, illustrates that nothing in the ACA changes the excepted benefits governing statutes and demonstrates that agencies must adhere to the boundaries set forth in Federal statute. Commenters stated that the ACA is entirely focused on comprehensive medical coverage, while excepted benefits are not intended to serve as such coverage. They maintained that excepted benefits are not used to finance the delivery of health care services but are meant to provide benefits for a wide variety of costs associated with accidents or illnesses not covered by comprehensive medical insurance, or to defray costs that are not fully covered by comprehensive medical coverage. For example, commenters stated that some of these products, such as dental and vision plans and Medicare supplemental insurance (Medigap), can cover additional benefits not included in comprehensive medical plans. Commenters stated that noncoordinated excepted benefits, such as fixed indemnity excepted benefits and specified disease excepted benefits coverage, must pay benefits regardless of whether the medical event triggering benefits is covered under another plan. Commenters stated that while comprehensive medical insurance coverage is regulated through HIPAA or the ACA, excepted benefits are subject to separate long-standing and extensive State regulatory regimes whereby Congress and State policymakers have consistently maintained excepted benefits are not meant to be a type of comprehensive health insurance that pays for medical benefits, and therefore, commenters argue, should not be within the purview of the ACA, including section 1557. Commenters further expressed concerns that applying the rule to excepted benefits could severely disrupt the market for these benefits and may drive competitors out of the market, E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ultimately increasing health care costs and premiums and reducing product choice for consumers and employers, and thereby reducing access to care. Commenters also asserted that applying the rule to excepted benefits could result in increased costs that are passed onto consumers as increased premiums, which could result in individuals dropping coverage due to lack of affordability and thereby result in reducing access to care, particularly in dental plans where consumers are highly price sensitive when selecting coverage. Conversely, many other commenters supported applying the rule to excepted benefits as part of an issuer’s operations. Commenters noted that excepted benefits are under-regulated and not otherwise subject to nondiscrimination requirements. Commenters argued this would provide comprehensive nondiscrimination protections for individuals enrolled in excepted benefits, particularly individuals with disabilities who face barriers to accessing care. Response: OCR appreciates the breadth of comments received and the concerns raised. Excepted benefits are statutorily defined benefits that are exempt from the Federal consumer protection and market reforms applicable to comprehensive coverage under title XXVII of the PHS Act, part 7 of ERISA, and Chapter 100 of the Internal Revenue Code (hereinafter the Federal consumer protections and market reform requirements applicable to comprehensive coverage). Some excepted benefits are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage in all circumstances, such as coverage only for accident, workers’ compensation or similar coverage, disability income coverage, and coverage for on-site medical clinics. 42 U.S.C. 300gg–21(b), 300gg–63(a), and 300gg–91(c)(1). Other types of coverage, known as limited excepted benefits, are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage when the benefits are offered under a separate policy, certificate or contract of insurance, or are otherwise not an integral part of the plan. 42 U.S.C. 300gg–21(c)(1), 300gg–63(b), and 300gg– 91(c)(2). Examples of limited excepted benefits include certain limited scope vision insurance and limited scope dental insurance (though stand-alone dental plans sold through the Exchange are subject to certain qualified health VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 plan requirements),249 and long term care insurance. Another type of coverage, known as independent, noncoordinated excepted benefits, are exempt from the Federal consumer protection and market reform requirements applicable to comprehensive coverage when certain conditions are met. 42 U.S.C. 300gg– 21(c)(2), 300gg–63(b), and 300gg– 91(c)(3). This category of excepted benefits includes coverage only for a specified disease or illness (such as cancer-only policies) and hospital indemnity or other fixed indemnity insurance. The final type of excepted benefit coverage is supplemental excepted benefits. Benefits are supplemental excepted benefits only if they are provided under a separate policy, certificate, or contract of insurance and are Medicare supplemental health insurance (also known as ‘‘Medigap’’), coverage supplemental to the coverage provided under 10 U.S.C. chapter 55 (also known as TRICARE supplemental programs), or similar supplemental coverage provided to coverage under a group health plan. 42 U.S.C. 300gg– 21(c)(3), 300gg–63(b), and 300gg– 91(c)(4). Excepted benefits offer more limited coverage than, and are generally not intended to be an alternative to or replacement for, comprehensive coverage. These products are not subject to the Federal consumer protections and market reform requirements applicable to comprehensive coverage when applicable criteria are met. As we stated in the 2016 Rule, 81 FR 31431, and the 2022 NPRM, 87 FR 47875, and restate here, the fact that excepted benefits are exempt from the Federal consumer protections and market reform requirements applicable to comprehensive coverage, including the ACA’s consumer protections and market reforms, and are not intended to serve as comprehensive coverage does not justify their exclusion from section 1557.250 In addition, section 1557 does not limit its protections only to health programs and activities that are themselves subject to other provisions of the ACA or that are comprehensive coverage, but also applies to all operations of any covered entity that is principally engaged, as defined under the term ‘‘health program or activity’’ in 249 See, e.g., 45 CFR 155.1065 and 156.150. further note that none of the statutory provisions that establish the exemption for these products from the PHS Act Federal consumer protections and requirements applicable to comprehensive coverage extend beyond the requirements in title XXVII of the PHS Act. See 42 U.S.C. 300gg–21(b)–(c), 300gg–63, and 300gg–91(c). 250 We PO 00000 Frm 00101 Fmt 4701 Sfmt 4700 37621 § 92.4. Further, section 1557 is an independent provision, which Congress did not codify in the PHS Act or colocate in the ACA with the ACA’s market reforms. Further, section 1557 uses the broad term ‘‘health program or activity,’’ in contrast to elsewhere in the ACA where Congress specifically made distinctions between various types of insurance. If Congress had intended to limit section 1557’s reach to only certain types of insurance in the PHS Act or to carve out excepted benefits from the scope of section 1557, it could have done so. OCR is mindful of comments raised about potential market disruption and reduced health care options for the public. However, as we discussed previously in the definition of ‘‘health program or activity’’ under § 92.4, commenters did not provide sufficient evidence to support this contention. Further, we note that when OCR has determined that a particular plan is discriminatory under this final rule, a covered entity may provide a legitimate, nondiscriminatory reason for the plan’s benefit design. This could include evidence that compliance with § 92.207 would result in making the plan unaffordable to the extent the covered entity could no longer offer the plan. When such a reason is proffered, OCR will carefully consider the evidence presented by the covered entity in making our determination as to whether the reason is legitimate and not pretext for discrimination. In the case of alleged disability discrimination, covered entities may also prove that modifying a plan to comply with section 1557 would result in a fundamental alteration to their health program or activity. For these reasons, we are not excluding excepted benefits from requirements established in this final rule. If a recipient health insurance issuer is principally engaged in the provision or administration of health insurance coverage or other healthrelated coverage, all of its operations are covered, including its provision of excepted benefits. Further, we note that a principally engaged issuer would not be covered under this rule for its excepted benefits subsidiary if the issuer can prove that the subsidiary is legally separate from its federally funded activities.251 Commenters’ reliance on Central United to argue that this rule exceeds OCR’s regulatory authority by imposing new requirements that are inconsistent 251 For more information on how OCR will analyze such claims, see discussion of subsidiary liability under the definition of ‘‘health program or activity’’ in § 92.4 and under the Application to Third Party Administrators in this section. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37622 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations with statutory provisions regarding excepted benefits is misplaced. In Central United, the court invalidated the requirement at 45 CFR 148.220(b)(4)(i) that an individual must attest to having minimum essential coverage prior to purchasing fixed indemnity excepted benefits coverage in the individual market. The court held that imposing that requirement went beyond what Congress required under the PHS Act. 827 F.3d at 74. The PHS Act statutes at issue in Central United contain statutory language specifically addressing excepted benefits, while section 1557 does not expressly mention or address excepted benefits. Further, Congress could have but did not extend the exemption under the PHS Act for these products to section 1557.252 OCR therefore maintains that this rule’s interpretation and application to all operations of a recipient health insurance issuer when principally engaged, including an issuer’s excepted benefits, is the best reading of the section 1557 statutory language, which applies to ‘‘any health program or activity, any part of which is receiving Federal financial assistance.’’ 42 U.S.C. 18116(a) (emphasis added). Comment: A few commenters raised concerns with the sufficiency of the Proposed Rule’s discussion on excepted benefits. These commenters asserted the Proposed Rule did not adequately explain why subjecting excepted benefits to the rule is necessary or appropriate. Commenters stated that the regulatory text does not address excepted benefits and that the preamble discussion does not explain how the rule would apply to excepted benefits. Thus, according to commenters, there was insufficient notice for public comment, which they assert would likely subject the final rule to legal challenge as violative of the Administrative Procedure Act. These commenters argued OCR should issue a new Proposed Rule with comment period that explains how OCR intends to address excepted benefits and provides additional clarity on how the rule will apply to excepted benefits, taking into account the specific nature and legal structure of such products that Congress made statutorily distinct from major medical products. Commenters also objected to the Proposed Rule’s investigative approach to evaluate claims of discrimination on a case-bycase basis, with one commenter arguing the case-by-case approach indicated a ‘‘regulation-by-audit scheme.’’ 252 See 42 U.S.C. 300gg–21(b)–(c) and 300gg–63. See also the conforming amendments in section 1563(a) of the ACA. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: We disagree that the Proposed Rule failed to adequately provide notice and opportunity to comment on OCR’s reasoning regarding the applicability of section 1557 to all operations of a recipient health insurance issuer that is principally engaged in the provision or administration of health insurance coverage or other health-related coverage. We fully discussed OCR’s legal authority and reasoning regarding this scope of coverage in the Proposed Rule’s discussion of the definition of ‘‘health program or activity’’ under § 92.4. 87 FR 47844–45. We also disagree that the Proposed Rule did not provide notice to the public of the terms or substance of how OCR intends to address excepted benefits for purposes of applying section 1557. In the preamble to the Proposed Rule, we clearly stated that all operations of a covered issuer principally engaged would include its other plans, explicitly mentioning excepted benefits. 87 FR 47875–76. Further, in the Proposed Rule, 87 FR 47875, we described the subject and the issues involved in how OCR will analyze claims of discriminatory benefit design by specifically stating that we acknowledged the unique nature of these products as being exempt from the Federal consumer protections and market reform requirements applicable to comprehensive coverage, and discussed how OCR proposes to investigate such plans by considering the nature, scope, and contours of the specific plan at issue and evaluating on a case-by-case basis an alleged discriminatory design feature in light of the entity’s stated coverage parameters.253 We also reiterated that covered entities have the opportunity to articulate a legitimate, nondiscriminatory basis for their challenged action or practice. As discussed throughout this section and in the Proposed Rule, OCR’s analysis for investigating a potentially discriminatory benefit design—as well as for all OCR investigations—is necessarily a fact-specific, case-by-case analysis. This is true for allegations related to benefit design features in all plans, including major medical coverage as well as excepted benefits. Comment: Some commenters raised concerns specific to Medicare 253 Cf. Easley by Easley v. Snider, 36 F.3d 297, 301–05 (3d Cir. 1994) (examining the ‘‘essential nature of the program’’ as intended by the state when determining that a state’s Attendant Care Program did not discriminate against individuals with mental disabilities under the ADA by excluding adults with disabilities who were not mentally alert). PO 00000 Frm 00102 Fmt 4701 Sfmt 4700 supplemental health insurance (known as ‘‘Medigap’’), which is an excepted benefit, and requested that the rule not apply to such plans. Commenters argued that applying section 1557 to Medigap plans would be inconsistent with Congress’s intent and the interlocking Federal-State regulatory framework set forth by Congress. A commenter noted that when Congress wants to alter this regulatory scheme, it speaks clearly,254 and because Congress made no such specific reference to Medigap when enacting section 1557, Congress intended Medigap to be beyond the scope of section 1557. Commenters discussed that Medigap is highly standardized coverage comprehensively regulated under both Federal and State law over which issuers have little discretion with respect to plan benefit design.255 Commenters explained that Federal law prescribes ten different types of Medigap benefit packages, with each offering a different set of standardized benefits.256 Commenters noted that Congress established a Federal-State regulatory framework that prescribes the benefits, eligibility, and rating methodologies permissible for Medigap plans, with States establishing Statespecific requirements for Medigap policies sold in their State. For example, a commenter noted that State laws may regulate Medigap plans in several ways, such as premium rating based on age, sex/gender, or medical underwriting, with some states requiring sex/gender rating; Medigap eligibility criteria based on an individual’s age, disability, or end-stage renal disease, with some States specifying that Medigap plans are not available to such individuals; and State-specific standardized Medigap plans over which issuers have no control with respect to benefit design, communications, or other factors. Commenters stated that Medigap is commonly underwritten after an initial open enrollment period to prevent adverse selection, and that Medigap 254 For example, the commenter noted that Congress revised the Medigap statute when it wanted to expressly apply section 104 of the Genetic Information Nondiscrimination Act to Medigap. Public Law 100–360, 102 Stat. 683, sec. 221 (1988) (codified in 42 U.S.C. 1395ss). 255 See 42 U.S.C. 1395ss, 42 CFR 403.200 through 403.258; see also Nat’l Ass’n of Ins. Comm’rs, NAIC Model Regulation to Implement the NAIC Medicare Supplement Insurance Minimum Standards Model Act, MO–651–1 (2022), https://content.naic.org/ sites/default/files/model-law-651.pdf. 256 See 42 U.S.C. 1395ss. See also U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare, 11 (2023), https://www.medicare.gov/ publications/02110-medigap-guide-healthinsurance.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 issuers are generally limited to competing along two dimensions: price and customer service.257 Commenters argued that subjecting Medigap to section 1557 could result in adverse selection that could force covered issuers to leave the Medigap market, resulting in reduced consumer choice, higher Medigap premiums, and lower quality of service for seniors. If the final rule does not exclude Medigap from section 1557, commenters requested at minimum that the rule specify that covered issuers are not responsible for possible discriminatory benefit designs, decisions, or actions that are a result of complying with a Federal or State requirement, including State-approved commercial underwriting practices. Response: OCR appreciates the concerns raised by commenters about Medigap, which is a statutorily defined excepted benefit.258 Medigap is a type of private supplemental health insurance coverage designed to cover cost-sharing gaps in original Medicare, such as deductibles, coinsurance, and copayments.259 Medigap is regulated by both Federal and State law. 42 U.S.C. 1395ss. Congress standardized Medigap plans to establish standard plan designs.260 While the plan benefits are standardized, the premiums and availability of the plans may vary by issuer depending on Federal and State law requirements. Medigap plans are statutorily prohibited from medical underwriting based on health status or imposing preexisting condition exclusions under certain circumstances, including during a six-month Medigap open enrollment period that begins when an individual turns 65 and enrolls in Medicare Part B and other specific times when guaranteed issue rights are available, 42 U.S.C. 1395ss(s), after which they are generally not prohibited from such practices under Federal law. States may enact their own Statespecific requirements on Medigap, including whether the plans are 257 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medigap (Medicare Supplement Health Insurance), https:// www.cms.gov/Medicare/Health-Plans/Medigap (stating that ‘‘the only difference between medigap policies sold by different insurance companies is the cost.’’). 258 Referred to as ‘‘Medicare supplemental health insurance’’ under 42 U.S.C. 300gg–91(c)(4); 45 CFR 144.103, 146.145(b)(5), and 148.220(b)(5). 259 Cong. Rsch. Serv., R47552, Medigap: Background and Statistics, 2 (2023), https:// sgp.fas.org/crs/misc/R47552.pdf. 260 Omnibus Budget Reconciliation Act of 1990, H.R. 5835, Pub. L. 101–508, pt. 5, Nov. 5, 1990, 104 Stat. 1388, https://www.congress.gov/bill/101stcongress/house-bill/5835. See also Cong. Rsch. Serv., R47552, Medigap: Background and Statistics, 5–7 (2023), https://sgp.fas.org/crs/misc/R47552.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 guaranteed issue and whether the premiums may be rated based on age, health status, sex, or other factors.261 In addition, while there generally is no Federal Medigap open enrollment period during which time Medigap plans must be sold to individuals with disabilities under the age of 65, some States may require it.262 Like other excepted benefits, Medigap is not designed to serve as comprehensive coverage and does not receive Federal financial assistance. As an excepted benefit, Medigap plans would be subject to the rule in the same fashion as other excepted benefits: if a Medigap plan is offered by a recipient health insurance issuer that is principally engaged in the provision or administration of health insurance coverage or other health-related coverage as specified under the definition of ‘‘health program or activity’’ in § 92.4, the Medigap plan would be subject to the rule as part of the issuer’s operations. That said, we acknowledge commenters’ concerns about State law requirements that might result in benefit design features that could violate section 1557. When investigating a discriminatory design feature in a Medigap plan, OCR will evaluate the covered entity’s legitimate, nondiscriminatory reason for the challenged feature. If the reason is based on a Federal or State law requirement, OCR will take this information into account when evaluating the context of the challenged design feature and will work with the covered entity to achieve compliance to help ensure that issuers do not leave the Medigap market or lower quality of products for consumers; however, section 1557 would preempt a State law Medigap requirement—or any other excepted benefit requirement— that compelled conduct prohibited by section 1557 as applied to a recipient health insurance issuer subject to section 1557. Comment: Many commenters supported the Proposed Rule’s application to STLDI as part of a principally engaged covered entity’s operations. Commenters argued that the proposed broad application is crucial to protect against discrimination in these products. 261 See, e.g., Cristina Boccuti et al., Kaiser Family Found., Medigap Enrollment and Consumer Protections Vary Across States, pp. 8–13 (2018), https://files.kff.org/attachment/Issue-BriefMedigap-Enrollment-and-Consumer-ProtectionsVary-Across-States. 262 See 42 U.S.C. 1395ss(s)(2)(A). See also Cong. Rsch. Serv., R47552, Medigap: Background and Statistics, 3 (2023), https://sgp.fas.org/crs/misc/ R47552.pdf. PO 00000 Frm 00103 Fmt 4701 Sfmt 4700 37623 Commenters stated that STLDI plans are marketed, often misleadingly and fraudulently, as an alternative to comprehensive coverage, but have significant gaps that lead to high out-ofpocket costs and little financial protection for consumers.263 Commenters stated that STLDI plans are under-regulated and use a lax regulatory environment to market and sell products that can harm individuals, especially those with complex health needs. For example, a commenter stated that a person with cancer would pay anywhere from $23,000 to $100,000 in out-of-pocket expenses during the first six months following diagnosis under an STLDI plan.264 Commenters discussed that STLDI plans charge higher prices based on an applicant’s age, sex, or disability and exclude or severely limit coverage for benefits related to preexisting conditions, prescription medications, mental health, and preventive services for women, contraception, and maternity care, all of which adversely impact individuals with disabilities, women, and individuals who are or who may become pregnant.265 Commenters suggested that the plans appear to be designed to discourage enrolling women of child-bearing age and that one study revealed that all plans reviewed discriminated against women through various practices, including gender rating and coverage exclusions.266 Commenters stated that including 263 See, e.g., Sabrina Corlette et al., Urban Inst., The Marketing of Short-Term Health Plans: An Assessment of Industry Practices and State Regulatory Responses (2019), https:// www.urban.org/sites/default/files/publication/ 99708/moni_stldi_final_0.pdf. 264 See, e.g., Gabriela Dieguez & Dane Hansen, Milliman, The Impact of Short-Term LimitedDuration Policy Expansion on Patients and the ACA Individual Market, p. 13 (2020), https://www.lls.org/ sites/default/files/National/USA/Pdf/STLD-ImpactReport-Final-Public.pdf. 265 See, e.g., H.R. Comm. on Energy & Com., 116th Cong., Shortchanged: How the Trump Administration’s Expansion of Junk Short-Term Health Insurance Plans is Putting Americans at Risk (2020), https://drive.google.com/file/d/ 1uiL3Bi9XV0mYnxpyaIMeg_Q–BJaURXX3/view; Dania Palanker & Emily Curran, Commonwealth Fund, Limitations of Short-Term Health Plans Persist Despite Predictions That They’d Evolve (2020), https://www.commonwealthfund.org/blog/ 2020/limitations-short-term-health-plans-persistdespite-predictions-theyd-evolve; JoAnn Volk et al., Commonwealth Fund, Trump Administration Promotes Coverage That Fails to Adequately Cover Women’s Key Health Care Needs (2020), https:// www.commonwealthfund.org/blog/2020/trumpadministration-promotes-coverage-that-fails-tocover-womens-key-health-care-needs. 266 H.R. Comm. on Energy & Com., 116th Cong., Shortchanged: How the Trump Administration’s Expansion of Junk Short-Term Health Insurance Plans is Putting Americans at Risk, 61, 74 (2020), https://drive.google.com/file/d/ 1uiL3Bi9XV0mYnxpyaIMeg_Q–BJaURXX3/view. E:\FR\FM\06MYR4.SGM 06MYR4 37624 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 coverage under section 1557 for these plans is particularly important for individuals with disabilities, including those with HIV, hepatitis, and mental health and substance use disorder disabilities who are harmed by discriminatory practices, such as including more frequent application of prior authorization and fail-first protocols and denials of medically necessary services. Because STLDI plans are not subject to traditional oversight of their provider networks, commenters stated that the plans may be designed in a way that limits care for LGBTQI+ people, individuals with disabilities, older individuals, individuals with LEP, or people of color.267 In addition, commenters observed that STLDI plans retroactively cancel coverage and are not guaranteed renewable, leaving people with serious health conditions without coverage and often unable to enroll if the denial occurred outside of an ACA open enrollment period.268 One insurance industry commenter raised detailed concerns about applying the rule to STDLI in its discussion opposing the rule’s application to excepted benefits. The commenter argued that similar to arguments above regarding excepted benefits, Congress excluded these products from most of the ACA’s requirements and that applying the rule to these products would create a competitive disadvantage for covered entities that must comply with section 1557 as compared to non-recipient competitors that can offer lower-cost coverage due to the ability to vary premium rates on the basis of factors otherwise prohibited under section 1557 or exclude higher cost benefits. The commenter also argued recipients would be subject to greater costs due to compliance with section 1557’s procedural requirements. Response: OCR appreciates commenters’ support and shares the concerns raised by commenters about the misleading and deceptive practices of some issuers of STLDI plans. STLDI is excluded from the definition of ‘‘individual health insurance coverage’’ under the PHS Act.269 As a result, it is 267 See, e.g., H.R. Comm. on Energy & Com., 116th Cong., Shortchanged: How the Trump Administration’s Expansion of Junk Short-Term Health Insurance Plans is Putting Americans at Risk (2020), https://drive.google.com/file/d/ 1uiL3Bi9XV0mYnxpyaIMeg_Q–BJaURXX3/view. 268 See, e.g., Gabriela Dieguez & Dane Hansen, Milliman, The Impact of Short-Term LimitedDuration Policy Expansion on Patients and the ACA Individual Market, p. 11 (2020), https://www.lls.org/ sites/default/files/National/USA/Pdf/STLD-ImpactReport-Final-Public.pdf. 269 42 U.S.C. 300gg–91(b)(5) defines ‘‘individual health insurance coverage’’ to mean ‘‘health VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 generally exempt from the Federal consumer protections and market reform requirements applicable to comprehensive coverage offered in the individual market, such as the prohibition on discrimination based on health status, 42 U.S.C. 300gg–4, the prohibition of preexisting condition exclusions, 42 U.S.C. 300gg–3, and the prohibition on lifetime and annual dollar limits on EHB, 42 U.S.C 300gg– 11, among others. These plans were traditionally not designed to serve as comprehensive coverage and were intended to fill temporary coverage gaps when an individual was transitioning between comprehensive coverages. See 81 FR 38020, 38032 (June 10, 2016).270 OCR acknowledges the commenter’s concerns about competitive disadvantage and compliance costs. However, as discussed previously, the risk of competitive disadvantage is low given that the majority of health insurance issuers offer some type of product that receives Federal financial assistance, and by accepting the benefit of Federal funds, a recipient is prohibited from discriminating in its health programs and activities under section 1557. For the same reasons set forth above explaining why this rule applies to a principally engaged recipient issuer’s excepted benefits, STLDI would be covered under this final rule as part of a recipient issuer’s operations if the issuer is principally engaged as set forth in the definition of ‘‘health program or activity’’ at § 92.4. That Congress excluded STLDI from the PHS Act definition of individual health insurance coverage does not exclude such coverage from section 1557. Congress could have but did not extend the exemption for these products to section 1557. section 1557 applies to ‘‘health programs or activities’’ and contains no exceptions for certain types of plans or coverage, nor is it limited to plans or coverage that are subject to other provisions in the ACA. OCR therefore maintains that this rule’s interpretation and application to all operations of a recipient health insurance coverage offered to individuals in the individual market, but does not include short-term limited duration insurance.’’ (Emphasis added.) 270 See also, U.S. Dep’t of Health & Hum. Servs., Short-Term Limited Duration Insurance: Independent, Noncoordinated Excepted Benefits Coverage; Level-Funded Plan Arrangements; and Tax Treatment of Certain Accident and Health Insurance, Proposed Rule, 88 FR 44596 (July 12, 2023) (proposing to narrow the definition of ‘‘shortterm limited duration insurance’’ to mean health insurance coverage that has an expiration date that is ‘‘no more than 3 months after the original effective date of the policy, certificate, or contract of insurance, and taking into account any renewals or extensions, has a duration no longer than 4 months in total’’.) PO 00000 Frm 00104 Fmt 4701 Sfmt 4700 insurance issuer when principally engaged, including an issuer’s products, is the best reading of the section 1557 statutory language, which applies to ‘‘any health program or activity, any part of which is receiving Federal financial assistance.’’ 42 U.S.C. 18116(a) (emphasis added). Application to Third Party Administrators In the Proposed Rule, we discussed that an issuer’s or other entity’s operations related to third party administrative services also would be subject to the rule when the issuer receives Federal financial assistance and is deemed to be principally engaged in the provision or administration of health insurance coverage or other health-related coverage as set forth in the definition of ‘‘health program or activity’’ under § 92.4. 87 FR 47876–77. We stated that we will engage in a factspecific analysis to evaluate whether a third party administrator is appropriately covered under section 1557 as a recipient of Federal financial assistance in circumstances where the third party administrator is legally separate from the issuer that receives Federal financial assistance. When investigating complaints relating to third party administrators that are appropriately covered under section 1557, we stated that OCR will determine whether responsibility for the decision or alleged discriminatory action lies with the plan sponsor or with the covered third party administrator. Where the alleged discrimination relates to the administration of the plan by a covered third party administrator, we stated that OCR will process the complaint against the third party administrator because it is the entity responsible for the decision or other action being challenged in the complaint. We also stated that OCR will pursue claims against the covered third party administrator in circumstances where the third party administrator is the entity responsible for developing the discriminatory benefit design feature that was adopted by the employer. Where the alleged discrimination relates to the benefit design of self-insured group health plan coverage that did not originate with the third party administrator, but rather with the plan sponsor, OCR will refer the complaint to the Equal Employment Opportunity Commission (EEOC) or DOJ for potential investigation. We discussed that we would refer complaints related to the Federal Employees Health Benefits (FEHB) Program, the Federal Employees Dental and Vision Insurance Program (FEDVIP), or the Federal Long Term E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 Care Insurance Program (FLTCIP) to the Office of Personnel Management (OPM). The comments and our responses regarding coverage of third party administrator activities are set forth below. Comment: Several commenters supported the rule’s application to third party administrators as part of the operations of a principally engaged recipient health insurance issuer. Commenters stated that issuers often serve as third party administrators and the rule’s application to an issuer’s third party administrator activities will help achieve health equity, improve health outcomes, and ensure that all individuals can access health care without unnecessary barriers. Commenters stated that third party administrators play an outsized role in administering and designing health coverage for millions of people enrolled in self-funded employer group health plan coverage,271 which may contain discriminatory provisions prohibited by section 1557.272 Commenters discussed how third party administrators do more than simply process claims. These commenters stated that, similar to issuers, third party administrators make significant decisions about critical health plan features and often design benefits, formularies, payment structures, and networks; conduct prior authorization; and establish and evaluate other clinical coverage criteria. One commenter stated that third party administrators rely on their own clinical criteria, which may result in discriminatory denials of coverage despite the plan providing coverage generally. For example, the commenter discussed that where a self-funded plan might provide coverage for genderaffirming care, the third party administrator might rely on its own clinical criteria to categorically exclude coverage for certain types of genderaffirming care. Other commenters opposed the rule covering third party administrators. These commenters argued the rule should exclude third party administrators from the scope of the final rule and that section 1557’s 271 Commenters noted that 64 percent of workers in the United States receive health coverage through self-insured employer plans. Gary Claxton et al., Kaiser Family Found., Employer Health Benefits 2021 Annual Survey, p. 9 (2021), https:// files.kff.org/attachment/Report-Employer-HealthBenefits-2021-Annual-Survey.pdf. 272 See, e.g., Anna Kirkland et al., Transition Coverage and Clarity in Self-Insured Corporate Health Insurance Benefit Plans, 6 Transgender Health 4, 214 (2021), https://www.liebertpub.com/ doi/full/10.1089/trgh.2020.0067 (showing that employer plans had three times as many categorical exclusions for gender-affirming health care). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 application should not extend beyond the legal entity that provides or offers the ‘‘health program or activity.’’ Several commenters argued that the rule’s coverage of third party administrators would create an unlevel playing field and result in a competitive disadvantage for health insurance issuers that accept Federal financial assistance. For example, commenters argued the administrative costs of complying with section 1557, such as the nondiscrimination notice requirements, would place covered third party administrators at a competitive disadvantage with noncovered third party administrators that are not subject to the same requirements. Commenters asserted that third party administrators generally do not receive Federal financial assistance and argued that applying section 1557 to third party administrators would result in subjecting all their clients to section 1557’s requirements when neither the client nor the third party administrator receives Federal financial assistance. Commenters argued this would create a disincentive for clients to engage a third party administrator that is subject to section 1557 and so would create an unlevel playing field between third party administrators covered by section 1557 and those that are not. Commenters further suggested this could result in entities deciding not to participate in federally funded or conducted programs, such as the Exchanges. One commenter asserted OCR did not explain the need for this proposed change from the 2020 Rule, which does not cover an issuer’s third party administrator activities, and that the uncertainty of how the rule will apply to covered third party administrators would likely result in higher third party administrator charges to employers, which would be passed through to enrollees. Response: We appreciate the diversity of comments received on our proposal to apply section 1557 to third party administrators when certain criteria are met. The final rule applies to all the operations of a recipient principally engaged in the provision or administration of health insurance coverage or other health-related coverage, including its third party administrator activities, as discussed in detail previously under the definition of ‘‘health program or activity’’ under § 92.4. This position is also supported by a decision of the District Court for the Western District of Washington, which held that third party administrators operated by health insurance issuers are subject to section PO 00000 Frm 00105 Fmt 4701 Sfmt 4700 37625 1557 even if the third party administrators do not receive Federal financial assistance.273 In addition, a third party administrator could be covered under the rule if it is a subrecipient of Federal financial assistance. We also note that where a third party administrator is not covered under section 1557, a covered entity that contracts with a third party administrator, such as a health insurance issuer or group health plan, may be liable for the third party administrator’s actions as a subcontractor. Please see the earlier discussion on subrecipients and contractors in the sections on Application, § 92.2, and the definition of ‘‘Federal financial assistance,’’ § 92.4. We acknowledge commenters’ concerns that this may result in a competitive disadvantage for health insurance issuers that accept Federal financial assistance. This argument, however, is not unique to health insurance issuers or their third party administrator activities. Any covered entity that accepts Federal funding from the Department knowingly agrees to comply with section 1557 and other civil rights laws that apply to recipients of Federal financial assistance. Comment: Some commenters were opposed to the rule holding a third party administrator liable for plan benefit designs even if the discriminatory terms originated with the third party administrator. Commenters stated this approach was inconsistent with the 2016 Rule’s approach that a third party administrator was liable only where the third party administrator was ‘‘responsible for the decision or action . . . as the decision-making entity.’’ 81 FR 31432. These commenters requested that OCR clarify that a third party administrator will be held responsible for actions only when it is the entity that controls whether or not the action must be taken. Commenters argued that third party administrators should not be liable for plan benefit designs simply because a third party administrator suggested or helped develop the benefit design ultimately chosen by the group health plan because the third party administrator is not the decision-making entity that adopted the benefit design. Accordingly, commenters argued that third party administrators should not be held responsible for administering benefits based on benefit design decisions made solely by a plan sponsor and urged OCR to clarify that the rule will not apply to third party 273 See C. P. by & through Pritchard v. Blue Cross Blue Shield of Ill., No. 3:20–CV–06145–RJB, 2022 WL 17788148, at *8 (W.D. Wash. Dec. 19, 2022). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37626 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations administrators in cases where a plan sponsor adopts a potentially discriminatory plan design that the third party administrator played no role in selecting. Commenters also noted that, under ERISA, third party administrators generally must administer self-insured plans according to the plans’ terms. 29 U.S.C. 1104(a)(1)(D). These commenters asserted that a third party administrator should not be liable for the benefit design of a plan, including utilization management techniques, when it is administering the plan consistent with the plan terms as adopted by the group health plan or plan sponsor. Otherwise, commenters argued, the rule would effectively hold a third party administrator responsible for decisions made by another entity, namely, the plan’s named fiduciary or plan administrator. Commenters further stated that ERISA does not require the third party administrator to be responsible for plan terms, but does require the plan sponsor to have a ‘‘named fiduciary’’ that has ultimate control over the plan’s operation.274 A commenter argued it would be unreasonable for OCR to take the position that a third party administrator is legally obligated under section 1557 to violate its obligation under ERISA to honor its contract with the plan sponsor and honor the plan’s terms. Commenters also argued that covering third party administrators is contrary to Congressional intent. Commenters stated that under ERISA, Congress made the group health plan responsible for the benefits it chooses to provide, and that OCR should not shift that responsibility to third party administrators through section 1557. These commenters argued that had Congress intended for third party administrators to be subject to section 1557, it would have said so clearly. In contrast, several commenters expressed support for the rule that would make a covered third party administrator liable when the discriminatory plan feature originated with the third party administrator. These commenters asserted that third party administrators cannot insulate themselves from liability by arguing that ERISA requires a group health plan to be administered according to its terms (including by a third party administrator contracted by a plan sponsor). ERISA, commenters noted, does not exempt group health plans or their service providers (including third party 274 See, e.g., Dep’t of Labor, Meeting Your Fiduciary Responsibilities (2021), https:// www.dol.gov/node/63375. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 administrators) from complying with other Federal laws, like section 1557.275 These commenters, citing to case law,276 argued that third party administrators should be held liable under section 1557 for discriminatory plan administration and when discriminatory plan terms originate with the third party administrator, even when the plan sponsor subsequently adopts the plan designed by the third party administrator and maintains control over its terms. Commenters noted that many large health insurance issuers design and market self-funded plans to plan sponsors and contract to serve as third party administrators.277 Commenters noted that third party administrators are largely responsible for designing plans except for those offered by the most sophisticated employers. Commenters stated that issuers administer the self-funded plans using the same coverage policies that they use in their fully insured plans, and therefore the discriminatory terms in self-funded plans are often directly traceable to and redressable by third party administrators. Some commenters suggested that third party administrators should be liable for administering a plan with discriminatory benefit design features even when the plan design did not originate with the third party administrator. Commenters argued that third party administrators that agree to administer discriminatory plans play a role in discriminating against protected individuals and should not be given immunity when administering plans with discriminatory designs. Response: OCR carefully considered the variety of views expressed by commenters relating to the liability of a third party administrator covered under this rule. We agree with commenters that a third party administrator should not be held responsible for discriminatory plan design features over 275 See 29 U.S.C. 1144(d) (‘‘Nothing in this subchapter shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States . . . .’’). 276 Tovar v. Essentia Health, 857 F.3d 771, 778 (8th Cir. 2017). 277 Blue Cross Blue Shield of N.D., Self-Funding, Alternative Financial Arrangements for Group Benefit Plans, p. 1 (2019), https://www.bcbsnd.com/ content/dam/bcbsnd/documents/brochures/ employers/29300143_BND-Self-FundingBrochure.pdf (‘‘Groups with 26 or more employees enrolled have a choice of several standard design plan options available. There is additional flexibility for custom designed benefit plans for groups with more than 50 employees enrolled.’’); UnitedHealthcare, UMR, https://www.uhc.com/ employer/employer-resources/umr (stating UMR, UnitedHealthcare’s third party administrator, ‘‘serve[s] over 5 million members with custom plan designs, cost-containment solutions and innovative services’’). PO 00000 Frm 00106 Fmt 4701 Sfmt 4700 which the third party administrator exercised no control. We disagree with commenters that believe a covered third party administrator should not be liable for discriminatory benefit design features that originated with the third party administrator simply because the plan sponsor is ultimately the entity responsible under ERISA for adopting the plan and maintaining control over its terms. Our interpretation is consistent with case law, which has held that a third party administrator may be liable for discriminatory plan terms that originated with the third party administrator, notwithstanding the fact that the plan sponsor subsequently adopted the plan and maintained control over the terms.278 Further, as commenters noted, health insurance issuers operating as third party administrators often design the plans that they offer to self-insured group health plans and offer standard plan design options, often to small and midsize employers while only offering flexibility in the plan design to larger employers.279 We recognize that ERISA requires group health plans to be administered consistent with the terms governing the plan, as long as the terms are consistent with the provisions of the same 278 See, e.g. Tovar v. Essentia Health, 857 F.3d 771, 778 (8th Cir. 2017) (concluding that enrollee in a self-insured employer-sponsored plan could establish Article III standing for a claim of discrimination under section 1557 to sue a third party administrator where ‘‘the plan and its allegedly discriminatory terms originated with [the third party administrator]—not with [the employer],’’ and if the third party administrator provided the employer ‘‘with a discriminatory plan document, . . . notwithstanding the fact that [the employer] subsequently adopted the plan and maintained control over its terms’’); C. P. by & through Pritchard v. Blue Cross Blue Shield of Ill., No. 3:20–CV–06145–RJB, 2022 WL 17788148, at *7, *9 (W.D. Wash. Dec. 19, 2022) (holding that ‘‘third party administrators can be liable under Section 1557 based on discriminatory terms in a self-funded plan even if the third party administrator provided the plan document ‘notwithstanding the fact that the [plan sponsor] subsequently adopted the plan and maintained control over its terms’’’ (quoting Tovar, 857 F.3d at 778)); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. Minn. 2018) (holding that a third party administrator may be liable under section 1557 for damages arising from discriminatory terms in a self-insured, employersponsored health plan where the harm suffered ‘‘was proximately caused by [the third party administrator’s] designing and providing to [the self-insured plan] the discriminatory provisions in the plan’’). 279 See, e.g., Blue Cross Blue Shield of N.D., SelfFunding, Alternative Financial Arrangements for Group Benefit Plans, p. 1 (2019), https:// www.bcbsnd.com/content/dam/bcbsnd/documents/ brochures/employers/29300143_BND-Self-FundingBrochure.pdf (‘‘Groups with 26 or more employees enrolled have a choice of several standard design plan options available. There is additional flexibility for custom designed benefit plans for groups with more than 50 employees enrolled.’’). E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 subchapter in ERISA.280 ERISA then provides in the same subchapter that it is not to be construed to impair or supersede other Federal laws, including regulations issued under such laws.281 This rationale finds support in the cases that have held that ERISA’s requirement that a plan’s terms must be administered as written must not be construed to invalidate or impair section 1557.282 For these reasons, we affirm our general approach as discussed in the Proposed Rule at 87 FR 47876–77. When OCR investigates a potentially discriminatory action or plan design related to a self-insured group health plan coverage administered by a covered entity acting as a third party administrator, OCR will take into account the party responsible for the alleged discriminatory conduct. Recognizing that third party administrators might not be responsible for the benefit designs of the selfinsured group health plan coverage that they administer, OCR does not intend to enforce this rule against a third party administrator for a plan design that it did not design and over which it has no control. Where the discriminatory terms of the plan originated with the covered third party administrator rather than with the plan sponsor, the third party administrator could be liable for the discriminatory design feature under section 1557. Accordingly, when analyzing a claim against a covered third party administrator, OCR will determine whether responsibility for the decision or alleged discriminatory action lies with the third party administrator, group health plan, or the plan sponsor. Where the alleged discrimination relates to the administration of the plan by a covered third party administrator, OCR 280 29 U.S.C. 1104(a)(1)(D) (‘‘[A] fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries and . . . in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of this subchapter and subchapter III.’’ (emphasis added)). 281 29 U.S.C. 1144(d) (‘‘Nothing in this subchapter shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States (except as provided in sections 1031 and 1137(b) of this title) or any rule or regulation issued under any such law.’’). 282 See, e.g., C. P. by & through Pritchard v. Blue Cross Blue Shield of Ill., No. 3:20–CV–06145–RJB, 2022 WL 17788148, at *8, 10 (W.D. Wash. Dec. 19, 2022) (holding that ERISA’s requirement at 29 U.S.C. 1104(a)(1)(D) to administer a plan’s terms as written ‘‘is subservient to Section 1557, outlawing discrimination, which is dominant’’); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. Minn. 2018) (‘‘The Court will not construe ERISA to impair Section 1557. Nothing in Section 1557, explicitly or implicitly, suggests that TPAs are exempt from the statute’s nondiscrimination requirements.’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 will process the complaint against the covered third party administrator because it is the entity responsible for the decision or other action being challenged. For example, if a covered third party administrator applies a plan’s neutral, nondiscriminatory utilization management guidelines in a discriminatory way against an enrollee, OCR will proceed against the covered third party administrator as the entity responsible for the decision. In addition, OCR will pursue claims against a covered third party administrator in circumstances where the third party administrator is the entity responsible for developing the discriminatory benefit design feature that was adopted by the employer. For instance, if a covered third party administrator develops standard plan designs that it offers to employers, the covered third party administrator is liable for any discriminatory design feature in the plans because the plans originated with the third party administrator. Where the alleged discrimination relates to the benefit design of self-insured group health plan coverage that did not originate with the covered third party administrator, but rather with the plan sponsor or the group health plan, and where the third party administrator played no role in the development of the plan’s benefit design, OCR will refer the complaint to the EEOC or DOJ for potential investigation. As discussed in the Proposed Rule at 87 FR 47877, as part of OCR’s enforcement authority, OCR has the option of referring or transferring matters to other Federal agencies with jurisdiction over the entity. Accordingly, OCR will transfer matters to the EEOC or DOJ where OCR lacks jurisdiction over an employer responsible for the benefit design of employer-sponsored group health plan coverage. OCR will refer to OPM complaints alleging discrimination in the FEHB Program (including the Postal Service Health Benefits Program), FEDVIP, and FLTCIP. This Rule does not determine how or whether any other agency will investigate or enforce any matter referred or transferred by OCR. As part of OCR’s analysis, we will also engage in a fact-specific inquiry to evaluate whether a third party administrator is appropriately covered under section 1557 in circumstances where the third party administrator is legally separate from the issuer that receives Federal financial assistance, as discussed in more detail below. Comment: Commenters requested that OCR provide additional clarity on the circumstances under which OCR would hold a third party administrator liable PO 00000 Frm 00107 Fmt 4701 Sfmt 4700 37627 under the rule. Commenters stated that plan sponsors and third party administrators may place blame on each other for the discriminatory features. Another commenter said that a selfinsured plan sponsor could direct a third party administrator on the goals or parameters of the design it seeks or refer the third party administrator to other plan designs and request that the third party administrator develop a plan design in accordance with those parameters. The commenter argued that in these cases, where the third party administrator is not the decision-making entity that ultimately controls and determines whether to implement the design or feature, it should not be liable under section 1557 for that design or feature. Response: If a third party administrator is a covered entity under section 1557, it is responsible for ensuring that its actions do not discriminate on the basis of race, color, national origin, sex, age, or disability. Where a covered third party administrator plays a role in designing benefits for self-insured group health plan coverage, it must not do so in a manner that results in discrimination on a prohibited basis. This is so even if the plan sponsor requests that the covered third party administrator develop a certain plan design that includes a discriminatory feature. For example, if a plan sponsor requested that a covered third party administrator develop a plan design that excluded all enrollees of a certain race, there would be no question that a third party administrator could not design such a plan without violating section 1557. This is true for any other discriminatory design feature that would violate section 1557. In these cases, while the plan sponsor may be the entity requesting the particular design feature for a group health plan, the covered third party administrator would still be liable as the entity that designed such a plan, notwithstanding the plan sponsor’s request. Comment: Several commenters requested that OCR provide clarity on the rule’s application to pharmacy benefit managers. Many commenters argued that pharmacy benefit managers, similar to third party administrators, make significant decisions about critical health plan features and should be liable when they are responsible for discriminatory formulary benefit designs. Commenters noted that plan sponsors often defer to the expertise of pharmacy benefit managers. Commenters opposed to the rule’s application to third party administrators argued that pharmacy benefit managers similarly should not be liable under the E:\FR\FM\06MYR4.SGM 06MYR4 37628 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 rule when a pharmacy benefit manager was not responsible for designing the plan benefits that were adopted by the plan sponsor, similar to their arguments above against holding third party administrators liable under the rule. Response: We discuss the rule’s applicability to pharmacy benefit managers in the discussion under § 92.4 regarding the definition of ‘‘health program or activity.’’ Pharmacy benefit managers are health programs or activities and would be covered under the rule if they receive Federal financial assistance. A pharmacy benefit manager that does not directly receive Federal financial assistance would also be covered under the rule if it is part of the operations of a recipient that is principally engaged in the provision or administration of health-related services, health-related insurance coverage, or other health-related coverage, as set forth under the definition of ‘‘health program or activity’’ at § 92.4.283 If a pharmacy benefit manager is subject to section 1557 as part of the operations of a principally engaged recipient, we agree with commenters that the pharmacy benefit manager’s liability under the rule would be similar to that of a covered third party administrator. Both entities contract with other parties, such as issuers or sponsors of self-insured group health plan coverage, to administer health benefits to plan enrollees. They may design plan benefits, formularies, payment structures, networks, and conduct utilization management. Therefore, if OCR receives a complaint about a covered pharmacy benefit manager, OCR will evaluate the liability of the pharmacy benefit manager consistent with the analysis set forth above for third party administrators. That is, OCR will determine whether responsibility for the challenged action lies with the covered pharmacy benefit manager or the plan sponsor. Comment: One commenter requested that OCR clarify that administrative actions such as developing documents or preparing policy booklets for clients, alone, would not constitute third party administrator liability for discriminatory plan design features. Response: We affirm that such administrative actions would not violate 283 See, e.g., Doe One v. CVS Pharmacy, Inc., No. 18–cv–01031–EMC, slip op. at 12–23 (N.D. Cal., Aug. 5, 2022) (relying on section 1557, the 2016 Rule, and the incorporated civil rights statutes to conclude that the complaint plausibly alleged that CVS Pharmacy, Inc. is principally engaged in the business of health care and all of its operations are covered by section 1557, including its pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, L.L.C.). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 this rule to the extent the covered third party administrator is merely relaying information to enrollees consistent with the underlying plan terms that the third party administrator played no role in developing. Comment: Some commenters requested that the rule clarify that an entity covered by section 1557 cannot outsource the implementation or design of discriminatory plans to entities that are not covered by the rule. Another commenter requested that OCR clarify that any third-party company may be liable under section 1557 when discriminatory plan terms originate with, or are managed by, the third-party company. For example, the commenter stated that third-party specialty benefits programs may promote or manage discriminatory specialty medication programs. Response: A covered entity that outsources the implementation or benefit design of discriminatory plans remains liable under this rule for any discriminatory plan terms. Under the discussion of the definition of ‘‘Federal financial assistance’’ in § 92.4, we clarify that covered entities are responsible for the conduct of their subcontractors and cannot outsource or contract away their civil rights obligations by entering into contractual arrangements with subcontractors. A third-party company that develops or manages discriminatory plans on behalf of a covered entity would only be liable under section 1557 to the extent the third-party company is a recipient or subrecipient of Federal financial assistance from the Department, including if the third party is part of a principally engaged recipient’s operations. Comment: Commenters requested that OCR clarify when liability under section 1557 extends across affiliated companies. Some commenters expressed concern that third party administrators and pharmacy benefit managers would automatically be deemed to be covered entities under the rule solely because they are related to an entity that received Federal financial assistance. These commenters requested that the final rule provide the same clarification that was in the 2016 Rule to clarify that a third party administrator (or pharmacy benefit manager 284) is unlikely to be covered under the rule where they are ‘‘a legal entity that is truly independent of an issuer’s other, federally funded, activities.’’ 81 FR 31433. 284 The 2016 Rule did not address pharmacy benefit managers. PO 00000 Frm 00108 Fmt 4701 Sfmt 4700 Other commenters expressed concern that third party administrators and pharmacy benefit managers could use complex corporate structures to distinguish separate lines of business to evade compliance with section 1557.285 These commenters requested that OCR provide greater clarity on when liability under section 1557 extends across affiliated companies. Response: As discussed in the 2016 Rule, 81 FR 31433, OCR will conduct a case-by-case analysis to determine whether a third party administrator or pharmacy benefit manager is appropriately subject to section 1557 as part of the operations of a recipient covered entity in situations where the third party administrator or pharmacy benefit manager is legally separate from an issuer or other covered entity that receives Federal financial assistance. This fact-specific analysis will rely on principles developed in longstanding civil rights case law, such as the degree of interrelatedness between or among entities, including the degree of common ownership and control between or among entities.286 OCR will also examine whether the purpose of the legal separation was to avoid liability or avoid the application of civil rights law requirements—that is, whether it is intended to allow the entity to continue to administer discriminatory health insurance coverage or other healthrelated coverage.287 As indicated in the 2016 Rule, a third party administrator or pharmacy benefit manager is unlikely to be covered by this final rule where it is a legal entity that is truly independent 285 Cf., Doe One v. CVS Pharmacy, Inc., No. 18– cv–01031–EMC, slip op. at 15 (N.D. Cal., Aug. 5, 2022) (‘‘To ignore the overall interrelationship among the entities which, in the case at bar, design and implement the allegedly discriminatory program and permit the CVS interrelated entities to escape responsibility would exalt form over substance and impair the effectiveness of the antidiscrimination provision of the ACA.’’). 286 See, e.g., Papa v. Katy Indus., Inc., 166 F.3d 937, 939 (7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA); Arrowsmith v. Shelbourne, Inc., 69 F.3d 1235, 1240–42 (2d Cir. 1995) (title VII); Valesky v. Aquinas Acad., 2011 U.S. Dist. LEXIS 103791, No. 09–800 (W.D. Pa. Sept. 14, 2011) (title IX); Russo v Diocese of Greenberg, 2010 U.S. Dist. LEXIS 96338, No. 09–1169 (W.D. Pa. Sept. 15, 2010) (title IX, section 504); Margeson v. Springfield Terminal Railway Co., 1993 U.S. Dist. LEXIS 12243, No. CIV.A. 91–11475–Z (D. Mass. Aug. 24, 1993) (section 504); See also Doe One v. CVS Pharmacy, Inc., No. 18–cv–01031–EMC, slip op. at 12–23 (N.D. Cal., Aug. 5, 2022) (relying on section 1557, the 2016 Rule, and the incorporated civil rights statutes to conclude that the complaint plausibly alleged that CVS Pharmacy, Inc. is principally engaged in the business of health care and all of its operations are covered by section 1557, including its pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, L.L.C.) 287 Papa v. Katy Indus., Inc., 166 F.3d 937, 941 (7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations of an issuer’s other, federally funded activities. We also address subsidiary liability under the discussion of § 92.4’s definition of ‘‘health program or activity.’’ Comment: One commenter urged OCR to consider whether stop-loss coverage sold by a covered third party administrator to an employer results in discrimination on the basis of disability prohibited under section 1557. The commenter stated that stop-loss coverage uses techniques that target group members with high medical needs. The commenter asserted this could result in stop-loss coverage penalizing employers when a covered individual needs intensive treatment for a disabling condition. Response: Stop-loss insurance provides coverage for the benefit of the employers, plan sponsors, or group health plans to cover financial liability for such entities to provide protection against catastrophic or unpredictable losses, and does not provide coverage for individuals. Stop-loss insurance that does not discriminate against individuals on the grounds protected under section 1557 does not implicate this final rule. Comment: A few commenters expressed concern that the rule’s application to covered third party administrators does not account for situations where the third party administrator is administering plans for religious employers. Commenters argued the rule could impose a burden on an employer’s religious beliefs. Another commenter further argued that it could cause the employer to be exposed to liability for a claim of employment discrimination. The commenter explained that § 92.207 prohibits covered entities, such as a covered third party administrator, from providing a health-coverage related product that aligns with the beliefs and practices of religious employers. The commenter argued this results in a burden on the employer’s religion because such religious employers cannot obtain a health coverage-related product that is illegal for covered entities to provide. If such an employer were to obtain a group health plan that was consistent with its faith, the commenter argued that the employer is at risk of liability due to OCR’s position that it will transfer complaints alleging discrimination by an employer to the EEOC, which will review the employer’s plan to determine if it is discriminatory under title VII of the Civil Rights Act. Response: As discussed throughout this section, a health insurance issuer or third party administrator subject to section 1557 is prohibited from VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 discriminating on the basis of race, color, national origin, sex, age, or disability in its provision or administration of health insurance coverage or other health-related coverage, and is also able to seek assurance of a religious exemption consistent with § 92.302(b). As specified in § 92.2(b), section 1557 does not apply to an employer or a plan sponsor with regard to its employment practices, including the provision of employee health benefits. A religious employer is able to obtain health insurance coverage or administration of its self-funded group health plan coverage from any entity not subject to section 1557, which would fall outside of the application of this rule. Network Adequacy The comments and our responses regarding network adequacy are set forth below. Comment: Commenters appreciated OCR’s attention to network adequacy and its acknowledgement that certain provider networks may constitute discriminatory benefit design under section 1557. Commenters stated that discriminatory provider networks profoundly affect the accessibility and quality of care for vulnerable populations. One commenter expressed concern that OCR has limited interest in complaints about access to care stemming from provider networks because the preamble in the Proposed Rule emphasized that health plans have discretion over benefit design and did not explicitly mention provider networks. A commenter recommended that OCR amend the proposed § 92.207(b)(2) to expressly reference provider networks as a type of design feature that falls within the scope of prohibited discriminatory activities. Response: OCR acknowledges the importance of network adequacy in ensuring nondiscriminatory access to health care while also recognizing covered entities’ autonomy in developing their provider networks as part of their benefit design packages, consistent with existing State and Federal network adequacy and other laws, including section 1557.288 OCR will accept complaints related to provider networks and will investigate allegations of discrimination on a case288 Network plans offer medical care through a defined set of providers under contract with the issuer. See 42 U.S.C. 300gg–91(d)(10); 45 CFR 144.103 (defining ‘‘network plan’’ as ‘‘health insurance coverage of a health insurance issuer under which the financing and delivery of medical care (including items and services paid for as medical care) are provided, in whole or in part, through a defined set of providers under contract with the issuer’’). PO 00000 Frm 00109 Fmt 4701 Sfmt 4700 37629 by-case basis. OCR declines to amend § 92.207(b)(2) because we believe the regulatory text is clear as written and does not require further clarification. As previously discussed, the term ‘‘benefit design’’ encompasses an array of features, including provider networks, and OCR intends to interpret it broadly. Comment: Commenters urged OCR to include examples of discriminatory network design while articulating several practices that they believed to be violations of section 1557. Some network design practices commenters characterized as discriminatory included low reimbursement rates that lead to lower provider participation, arbitrary limits to in-network providers, limiting the participation of safety-net providers, insufficient providers with accessible medical equipment, narrow pharmacy networks, and performance requirements related to cost or other outcome and quality measures. Commenters argued that all of these practices prevent access and may be used by covered entities to dissuade enrollees with high health needs from enrolling in plans. Response: OCR appreciates commenters providing examples of how network plan designs might have discriminatory impacts on vulnerable populations. While we agree that certain network plan designs and practices, such as excluding all or most providers that specialize in treating certain conditions, may be discriminatory under section 1557, we will not establish minimum network adequacy standards in this rulemaking. As discussed in the Proposed Rule, 87 FR 47877, covered entities employing network plan designs may be subject to network adequacy standards governed by State and Federal law. For example, CMS regulations establish network adequacy requirements for qualified health plans, Medicare Advantage plans, and Medicare Part D prescription drug plans, and require states to develop and enforce network adequacy standards for their contracted Medicaid managed care plans. See 87 FR 47877. Many of these regulations establish specific requirements that must be satisfied, such as inclusion of certain types of providers and time and distance standards. Recognizing that network adequacy is regulated by other Departmental regulations, as we noted in the 2016 Rule, and again note here, it is outside the scope of section 1557 to establish uniform or minimum network adequacy standards. Comment: Commenters asserted that discriminatory network design practices lead to excessive, and often insurmountable, administrative burdens E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37630 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations for enrollees. Commenters also stated that provider network appeals processes can be opaque, arbitrary, and ultimately a tool to deny access to necessary care that meet the definition of a disability under the ADA. Commenters expressed concern over the increase in ‘‘phantom networks,’’ plans that list providers as in-network when they are not actually accepting patients, particularly for mental health providers. For example, commenters cited a recent study that showed that 60 percent of the mental health providers in the Oregon Medicaid managed care network were not actually accepting patients.289 Commenters expressed frustration in discovering that certain in-network providers are unable or unwilling to address multiple co-occurring disabilities or general medical care for people with disabilities. Response: Plan designs that subject individuals protected by section 1557 to excessive administrative burdens to access coverage benefits that other enrollees do not have to navigate to access coverage may be discriminatory under section 1557. Section 92.207(b) prohibits covered entities from discrimination ‘‘in providing or administering’’ (emphasis added) health insurance coverage or other healthrelated coverage. Comment: Commenters requested strict monitoring and enforcement of provider network compliance with section 1557. A commenter suggested that OCR include scrutiny of provider networks via regular compliance reviews in addition to investigating complaints. To determine whether a certain network design is discriminatory, a commenter urged OCR to consider access measures such as medication adherence, uptake of innovative therapies, and complaints and appeals regarding delayed or denied access to specialists and drugs. A commenter requested that OCR provide greater scrutiny to the impact of provider network consolidation, especially those involving religiously affiliated institutions, in creating discriminatory impacts on health care recipients. Other commenters stated that OCR should not establish network adequacy standards, as they believe that discrimination through network adequacy is sufficiently addressed by other State and Federal agencies as well as the National Association of Insurance 289 Jane M. Zhu et al., Phantom Networks: Discrepancies Between Reported and Realized Mental Health Care Access in Oregon Medicaid, 41 Health Affairs 7, 1016 (2022), https:// www.healthaffairs.org/doi/abs/10.1377/ hlthaff.2022.00052. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Commissioners, National Committee for Quality Assurance, and URAC (formerly Utilization Review Accreditation Commission). Commenters noted that as network requirements increase, providers and facilities demand increased reimbursement rates, additional contracts for other member or system facilities, and specific network tier placement. Commenters asked OCR to consider limiting provider contracting practices such as ‘‘all-ornothing’’ contracting and anti-tiering clauses. They noted that such practices harm consumers by increasing provider leverage and driving up health care costs. Response: While we will not establish minimum network adequacy standards in this rulemaking, we emphasize that to ensure compliance with section 1557, covered entities must develop their networks in a nondiscriminatory manner. When determining whether an entity has violated this section, OCR will conduct a fact-intensive investigation to determine whether the challenged network excludes individuals from participation in or denies them the benefits of the plan, or otherwise discriminates against them on the basis of race, color, national origin, sex, age, or disability. This analysis will include evaluating whether a covered entity utilized, in a nondiscriminatory manner, a neutral rule or principle when deciding to adopt its provider network. As noted in the Proposed Rule, OCR is cognizant that a variety of factors may affect a covered entity’s provider network design.290 If OCR determines that a network design is discriminatory, covered entities will be expected to provide a neutral, nondiscriminatory reason for the network design that is not a pretext for discrimination. Concerns around provider consolidation are out of the scope of this regulation; however, OCR acknowledges that as providers consolidate, there may be increased or novel concerns around discriminatory provider network design and impact to access to care for protected classes. Medical Diagnostic Equipment In the Proposed Rule, 87 FR 47836, OCR noted that individuals with mobility disabilities experience challenges accessing preventative, primary, and specialty care due to 290 Such factors include ‘‘the geographic location of the service area, the number of available providers and specialists in the service area, reimbursement rates, the number of providers willing to contract with the payer, and the overall design of the plan as it relates to premiums.’’ 87 FR 47877. We note that the importance of geographic limitations may be reduced due to the industry growth in virtual care and ease of medical travel, where clinically appropriate. PO 00000 Frm 00110 Fmt 4701 Sfmt 4700 inaccessible medical diagnostic equipment (MDE). OCR sought comment on the extent to which a lack of accessible MDE within a provider network limits or denies access to care for individuals with disabilities. OCR also requested comment on whether it should incorporate the U.S. Access Board’s Medical Diagnostic Equipment Standards (MDE Standards) as enforceable standards and whether a lack of accessible MDE constitutes discriminatory benefit design or network inadequacy. Comment: OCR received many comments urging OCR to adopt the MDE Standards, created pursuant to section 510 of the Rehabilitation Act, in the final rule. These commenters stated that inaccessible MDE leads to poor health outcomes for people with disabilities, mainly because inaccessible MDE results in individuals with disabilities receiving less preventative care, including mammograms and cervical screenings, compared to their counterparts without disabilities.291 One commenter also noted that this lack of preventative care, and ensuing poor health outcomes, could also place people with disabilities at unnecessary risk for institutionalization. Finally, these commenters urged OCR to state that the denial of services to individuals with disabilities due to inaccessible MDE is discrimination under other Federal disability rights laws, including section 504 and the ADA. One commenter recommended that OCR require covered entities to ensure that within 30 days of the publication of the final rule, all newly purchased or replaced MDE comply with the MDE Standards. The commenter also recommended that OCR require all covered entities that use MDE to ensure that within two (2) years of the publication of this rule, all of their MDE meets the MDE Standards. A different commenter recommended that OCR use a similar approach to that required by the 2010 ADA Standards for Accessible Design, 75 FR 56236 (Sep. 15, 2010), where accessible MDE would be purchased to replace older equipment as needed. Response: OCR appreciates the numerous comments requesting that the final rule require covered entities to comply with the MDE Standards. OCR agrees that when individuals with disabilities are denied appropriate preventative health care due to the 291 See Nat’l Council on Disability, Enforceable Accessible Medical Equipment Standards: A Necessary Means to Address the Health Care Needs of People with Mobility Disabilities (2021), https:// www.ncd.gov/assets/uploads/reports/ncd_medical_ equipment_report_508.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 inaccessibility of MDE, they are placed at increased risk of poor health outcomes and potentially institutionalization. As noted, section 504, the ADA, and section 1557 all prohibit covered entities from discriminating against people with disabilities by denying them appropriate health care services. Requiring covered entities to comply with the MDE Standards would be one method to ensure that people with certain disabilities receive appropriate health care services, while allowing for greater patient autonomy. On September 14, 2023, OCR issued an NPRM proposing updates to the Department’s section 504 regulations.292 OCR proposed specific accessibility standards, scoping requirements, and time periods for compliance for MDE used by recipients of Federal financial assistance in that NPRM.293 Accordingly, while OCR recognizes the importance of ensuring that all people, regardless of disability status, receive effective preventative care, we will not address the MDE Standards in the regulatory text of this rulemaking. Comment: Many commenters noted that while the MDE Standards were published in 2017, many providers, including recipients of Federal financial assistance, have failed to abide by the standards and acquire accessible MDE. As evidence, some commenters point to the data collected by the State of California concerning the prevalence of accessible MDE among providers, which they state indicates that the majority of California providers do not have accessible MDE.294 These commenters note that until a Federal regulation creates specific requirements, accessible MDE will not be used by the majority of providers. Finally, commenters noted that even if providers acquire accessible MDE, they still must ensure that their staff are able to use the MDE effectively in order for people with disabilities to benefit. Response: OCR recognizes that in the absence of an enforceable standard that requires providers to acquire MDE with specific features, providers may not acquire accessible MDE. This may be due in part to the cost of accessible MDE exceeding the cost of non-accessible MDE and the durability of existing MDE. OCR also agrees that if a provider 292 88 FR 63392 (Sept. 14, 2023). FR 63392, 63511 (Sept. 14, 2023) (proposed subpart J). 294 Nancy R. Mudrick et al., Presence of Accessible Equipment and Interior Elements in Primary Care Offices, 3.1 Health Equity 275 (2019), https://dredf.org/wp-content/uploads/2019/10/ Presence-of-Accessible-Equipment-and-InteriorElements-in-Primary-Care-Offices.pdf. 293 88 VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 acquires accessible MDE, such as an adjustable exam table, but does not ensure that staff can effectively use the table and assist patients with transfers, patients with disabilities will not benefit. For the MDE Standards to be effective, providers must also know how to use accessible MDE. OCR will continue to enforce existing nondiscrimination obligations and, as noted above, is in the process of rulemaking to adopt enforceable standards for accessible MDE under section 504. Comment: Numerous commenters requested that OCR consider expanding on the existing MDE Standards. Some commenters requested that OCR create new standards specific to individuals with visual impairments, sensory limitations, or cognitive disabilities. Some commenters also requested that OCR expand the MDE Standards to nondiagnostic medical equipment in addition to MDE, with others, requesting that OCR determine the scoping requirements that covered entities would have to follow under the MDE Standards. Response: OCR appreciates commenters’ suggestions. Because we are not requiring providers to abide by the MDE Standards in this rulemaking, we will not determine whether to expand the MDE Standards beyond diagnostic equipment, create new standards unique to individuals with other disabilities, or determine the scoping requirements of the MDE Standards. However, we will consider these recommendations and note that regardless of whether medical equipment is diagnostic, a covered entity must make its health programs and activities accessible to individuals with disabilities. Comment: Numerous commenters stated that because of inaccessible MDE, many patients with disabilities have been asked to bring someone with them to appointments in order to help them transfer onto MDE. The commenters state that it is never appropriate to require this of a patient. Response: Existing Federal civil rights laws, including section 504, title II of the ADA, and the existing section 1557 implementing regulation, forbid providers from requiring a patient with a disability to bring their own aide or support person to an appointment to assist them with transfers. Any person who has been required by a provider to bring another person to an appointment to assist with transfers is encouraged to file a complaint with OCR. Comment: One commenter stated that the use of accessible MDE could be considered a reasonable modification PO 00000 Frm 00111 Fmt 4701 Sfmt 4700 37631 for persons with disabilities as required by existing disability rights laws. Response: Providing accessible MDE is one method that providers can use to ensure that a patient with a disability is able to access a provider’s programs and activities. A provider would likely violate Federal disability discrimination laws like section 504, the ADA, and section 1557 if the health programs and activities they provide, including preventative and diagnostic care, are not accessible to people with disabilities. Comment: One commenter stated that while requiring covered entities to obtain and use accessible MDE would be beneficial to people with disabilities, in certain circumstances it may be sufficient for a covered entity without accessible MDE to offer transportation to another covered entity with accessible MDE. Response: While a provider acquiring and using accessible MDE so that its patients with disabilities are able to receive health care in its offices is preferrable, there may be specific situations where it is appropriate for the provider to offer transportation to another facility that has accessible MDE. Comment: Many commenters stated that they consider accessible MDE to raise both network adequacy and benefit design implications. They believed that a lack of accessible MDE leads to a lack of in-network care and a lack of network adequacy, which they alleged to be discriminatory. They stated that benefit design could be used to embed accessible MDE requirements. They also stated that accessibility should also be considered in conjunction with time and distance standards to determine network adequacy. Response: OCR appreciates commenters raising these important opinions concerning how the presence of accessible MDE affects network adequacy and benefit design. While OCR has decided not to explicitly address accessible MDE in this rulemaking, we refer commenters to the discussion of network adequacy and benefit design under this section. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the nondiscrimination in health insurance coverage and other healthrelated coverage provision at § 92.207 as proposed, with modification. We have revised § 92.207(b)(6) to clarify that the integration requirement extends to practices that result in the serious risk of institutionalization or segregation. We have revised § 92.207(c) to strike the text following ‘‘legitimate, E:\FR\FM\06MYR4.SGM 06MYR4 37632 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 nondiscriminatory reason for’’ and now the text prohibits ‘‘denying or limiting coverage of the health service or determining that such health service fails to meet applicable coverage requirements including reasonable medical management techniques such as medical necessity requirements.’’ This section also provides that ‘‘such coverage denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302.’’ We have also made conforming edits to include ‘‘or any combination thereof’’ to the list of prohibited bases of discrimination found § 92.207(a) and (b)(1) and (2). Prohibition on Sex Discrimination Related to Marital, Parental, or Family Status (§ 92.208) In § 92.208, OCR proposed to prohibit covered entities from discriminating on the basis of sex in their health programs and activities with respect to an individual’s marital, parental, or family status. The 2016 and 2020 final rules did not include a similar provision. This is not a new concept, however, as it is similar to the Department’s title IX implementing regulations. See 45 CFR 86.40(a). Section 92.208 provides that, in determining whether an individual satisfies any policy or criterion regarding access to its health programs or activities, a covered entity must not take an individual’s sex into account in applying any rule concerning an individual’s current, perceived, potential, or past marital, parental, or family status.295 The comments and our responses regarding § 92.208 are set forth below. Comment: Many commenters supported the inclusion of § 92.208 because it provides clarity for patients and providers and brings OCR into alignment with other nondiscrimination practices set by section 1557, ensuring that all vulnerable groups receive the same level of civil rights protections. Several commenters mentioned that this change aligned with the title IX regulation, which has, since 1975, explicitly interpreted sex discrimination to encompass discrimination on the basis of current, potential, or past parental, family, or marital status that treats persons differently on the basis of sex. Commenters also raised other civil rights statutes, like the Civil Service Reform Act that is applicable to Federal 295 This final rule does not preclude the application of Federal laws regarding eligibility criteria for certain Federal programs under CMS. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 employees, which explicitly includes protections based on marital status.296 Response: OCR agrees that including this provision brings regulations in line with other civil rights laws that recognize policies that treat people differently on the basis of sex in applying rules related to marital, parental, or family status,297 as discrimination on the basis of sex, particularly, and as stated in the Proposed Rule’s preamble, the Department’s longstanding acknowledgment of this interpretation of title IX, at 45 CFR 86.40(a). Comment: Numerous commenters supported proposed § 92.208. Some of these commenters explained that taking marital, parental, or family status into account has engendered arbitrary policies at medical facilities that create barriers to accessing health care, which can result in harmful and inequitable treatment of individuals. Many commenters stated that this provision will help alleviate the denial of care some women experience because they are single, unmarried, childless, or not in the presence of a male partner or husband when they are seeking, for instance, birth control. Response: OCR agrees that absent the prohibition on taking sex into account in marital, parental, or family status, covered entities may adopt arbitrary policies that could create unnecessary inequities and result in harmful health outcomes. Section 92.208 prohibits discrimination that applies different policies and procedures based on sex in the context of marital, parental, or family status; it does not, however, prohibit discrimination on the basis of marital status alone (i.e., single, divorced, widowed, etc.). As discussed in the 2022 NPRM, OCR encountered complaints, in the course of its enforcement work, where covered entities applied different policies for married men and married women. For example, OCR has settled cases against covered entities with policies of automatically assigning a male spouse as the guarantor when a female spouse received medical services, while not automatically assigning a female spouse as the guarantor when a male spouse received medical services. 87 FR 78878. Comment: Many commenters supported the protections against discrimination on the basis of sex in the context of marital, parental, and family 296 See Public Law 95–454, sec. 101, 92 Stat. 1111, 1113–14 (Oct. 13, 1978), codified at 5 U.S.C. 2301(b). 297 The term ‘‘family status’’ used in this rule is distinct from any defined terms in other rules, including ‘‘familial status’’ as defined in the Fair Housing Act, 42 U.S.C. 3601 et seq. PO 00000 Frm 00112 Fmt 4701 Sfmt 4700 status contained in § 92.208 because of their impact on same-sex couples and the varying types of discrimination that this group experiences, including past experiences of discrimination on the basis of marital, parental, and family status alone. For example, some commenters said that these protections are critical because, although many same-sex couples live in committed relationships, they are less likely to be married, largely due to laws that until recently prohibited same-sex marriage. These protections, commenters argued, help to insulate LGBTQI+ individuals who have experienced discrimination in many health care settings, such as hospitals where they have been denied visitation rights and authority to make medical decisions impacting their loved ones’ health conditions. Many commenters highlighted that these forms of discrimination were well documented during the AIDS crisis, when longtime partners were regularly denied hospital visitation rights and lacked adequate protections, even for discrimination based solely on marital status. For similar reasons, some commenters stated that this provision would protect families headed by samesex couples, who may be denied the right to make medical decisions for their children. These commenters noted, that in the health care context, the involvement of family and external support systems can improve health outcomes, management of chronic illnesses, and continuity of care. Response: OCR agrees that the prohibition on taking an individual’s sex into account in applying any rule concerning an individual’s current, perceived, potential, or past marital, parental, or family status can be critical in health care settings involving medical decision-making and visitation rights, particularly for same-sex couples. Section 92.208 prohibits a covered entity from implementing a policy related to marital, parental, or family status that treats individuals differently on the basis of sex (e.g., male spouses of women can make medical decisions for their children but non-male spouses of women cannot, or allowing visitation rights for a married heterosexual couple but denying visitation rights to a married same-sex couple), but it does not prohibit covered entities from making distinctions based upon their marital status alone (e.g., applying different rules to married and nonmarried individuals that do not distinguish based on an individual’s sex). Comment: Other commenters also discussed the impact that the protections contained in proposed E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations § 92.208 have on same-sex couples seeking fertility treatments. They stated that these protections are needed because some health insurance coverage or other health-related coverage include in vitro fertilization (IVF) treatments as a covered benefit for heterosexual married couples, but not for same-sex married couples. Some commenters highlighted how, in their view, institutional policies’ definition of ‘‘infertility’’ lead to such a discriminatory practice. This establishes what commenters describe as an impossible standard for same-sex couples to meet when seeking fertility treatment and coverage. Response: OCR understands that not all covered health insurance issuers offer fertility coverage or treatments. However, those that do must offer such benefits in a nondiscriminatory manner. For example, a covered health insurance issuer that offers fertility coverage or treatments for married different-sex couples could not deny the same coverage or treatments to married samesex couples. section 1557’s prohibitions of discrimination apply across all covered health programs and activities. Comment: Other commenters who supported the inclusion of § 92.208 stated that these protections are important because they help ensure nondiscrimination against a wide range of family structures. Response: OCR reminds commenters that this section prohibits discrimination on the basis of sex when applying rules related to marital, parental, and family status, and is not to be conflated with prohibition against discrimination on the basis of these statuses alone. Thus, policies and procedures that include conditions or limitations tied to these statuses would not run afoul of this rule unless they applied differently based on the sex of the individuals. Comment: Some commenters supported § 92.208 because in their view, a medical practice cannot refuse a female patient solely because she has a female spouse or partner, as this could constitute a denial on the basis of association. Response: OCR agrees that a medical practice may not refuse to see a prospective female patient based solely on the fact that the patient has a female spouse if they otherwise accept married individuals into their practice. This is because the refusal would be based on the sex of the prospective patient and would therefore constitute sex discrimination related to marital status. And, as noted in the Proposed Rule, a denial based on a female patient having a female spouse or partner would also VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 constitute discrimination on the basis of association, which is specifically addressed in § 92.209, as the refusal would be based on the sex of an individual with whom the patient is known to have a relationship or association. 87 FR 47880. Comment: Many commenters opposed the inclusion of § 92.208, stating that if Congress meant to include ‘‘marital, parental, or family status’’ in section 1557 it would have done so, just as it did in part in the Equal Credit Opportunity Act (ECOA) (including ‘‘marital status’’) and the Fair Housing Act (FHA) (including ‘‘familial status’’). These commenters contended that adding these protections would make the addition of marital and familial status a mere surplusage to the text of the ECOA and FHA, and that it would include additional terms to their application despite neither statute explicitly including the additional terms. Some commenters who opposed the provision also stated that OCR needs to account for the additional costs of including these changes, especially as it may impact religious institutions that provide marital counseling services. Response: OCR disagrees that clarifying these protections under section 1557 impacts either the ECOA or FHA.298 While these statutes bar discrimination on the basis of an individual’s marital or familial status per se, § 92.208 bars discrimination on the basis of sex as it relates to marital and family status. As discussed in the 2022 NPRM, 87 FR 47878, this final rule’s interpretation is consistent with a parallel, longstanding prohibition included in the Department’s title IX implementing regulations, 45 CFR 86.40(a). OCR has consistently interpreted the scope of section 1557’s prohibition on the ground of sex consistently with the scope of title IX’s prohibition of discrimination on the ground of sex, which includes discrimination within the context of marital, parental, or family status.299 This provision will apply similar standards already enforced by OCR, and we do not anticipate additional costs for 298 Cf. Conn. Nat’l Bank v. Germain, 503 U.S. 249, 253 (1992) (courts must give effect to statutes with overlapping coverage ‘‘so long as there is no ‘positive repugnancy’ between the two’’). 299 As discussed in the 2022 NPRM, 87 FR 47878, OCR has resolved complaints against covered entities with policies of automatically assigning a male spouse as the guarantor when a female spouse received medical services, while not automatically assigning a female spouse as the guarantor when a male spouse received medical services. See U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Sex Case Summaries: Summary of Selected OCR Compliance Activities, https://www.hhs.gov/civilrights/for-providers/compliance-enforcement/ examples/sex-discrimination/. PO 00000 Frm 00113 Fmt 4701 Sfmt 4700 37633 covered entities, including religious institutions beyond the costs already captured in the Regulatory Impact Analysis below for recipients to seek assurances of religious and conscience exemptions under § 92.302(b). Discrimination on the Basis of Pregnancy-Related Conditions In proposing § 92.208, OCR stated its view that it could be beneficial to include a provision that would specifically prohibit discrimination on the basis of pregnancy-related conditions as a form of sex-based discrimination, and sought comment on how to include such a provision in the final rule. 87 FR 47879. This proposal was specifically requesting comment on a stand-alone provision, separate from the inclusion of ‘‘pregnancy or related conditions’’ in § 92.101(a)(2)’s inclusion of the term. Including such a provision at § 92.208 would mirror its placement to those of the Department’s title IX implementing regulations at 45 CFR 86.21(c), 86.40, 86.52(b), and 86.57. The 2016 Rule explicitly included ‘‘pregnancy, false pregnancy, termination of pregnancy, or recovery therefrom, childbirth or related medical conditions’’ in former § 92.4. While the 2020 Rule did not include any definition of ‘‘sex discrimination,’’ it indicated that section 1557 would be enforced consistent with title IX and its implementing regulations, which includes these terms. For the reasons explained below, we decline to add ‘‘pregnancy or related conditions’’ to § 92.208. The comments and our responses regarding this request for comment are set forth below. Comment: Many commenters supported the inclusion of a provision that includes pregnancy-related conditions as a prohibited form of discrimination on the basis of sex. Numerous commenters discussed that pregnancy-related conditions are inherently linked to sex because discrimination on that basis affects an individual’s ability to make decisions about their reproductive health and life, and affects individuals’ ability to be equal and participating members of society. Response: OCR appreciates these comments and agrees that clarifying that discrimination on the basis of sex includes pregnancy-related conditions, as § 92.101(a)(2)(ii) (‘‘discrimination on the basis of sex includes . . . pregnancy or related conditions’’) does, is critical to ensuring that individuals are protected against this form of sex discrimination. OCR also agrees that discrimination on the basis of E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37634 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations pregnancy or related conditions can negatively affect an individual’s ability to make decisions about their reproductive health and life, and their ability to be equal and participating members of society. Comment: Many commenters who supported the inclusion of pregnancyrelated conditions discussed the need for clarity in light of the Supreme Court’s decision in Dobbs. Commenters contended that pregnancy-related conditions should be included in the definition of ‘‘sex discrimination’’ because it would reinforce covered entities’ legal obligations under section 1557, and would allow OCR to address related discrimination more holistically and inclusively. Commenters maintained that pregnancy protections are critical in light of total or near-total abortion bans in some States after the Dobbs decision. Commenters explained that this legal uncertainty warrants clarity and explicit protections for pregnancy-related conditions, including termination of pregnancy, because patients and providers have been left uncertain and fearful of their ability to provide care, are subjected to additional scrutiny, and face the possibility of criminal prosecution and civil litigation in States that have limited reproductive health care options. Response: OCR affirms that under section 1557, covered entities may not discriminate against individuals for their pregnancy-related decisions, past, present, or future. OCR declines to add in additional protections outside of the scope of this rule. At the same time, the ACA itself provides that ‘‘[n]othing in this Act shall be construed to have any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A).300 HHS will comply with this provision. Comment: Some commenters discussed privacy concerns involving HIPAA, as some providers have worried that medical privacy may be compromised when patients seek care or information, even if unrelated to abortion. Commenters argued for the need to include pregnancy-related protections under section 1557 so that 300 The application of this final rule to covered entities with conscience or religious freedom objections are discussed more fully below in §§ 92.3 (Relationship to other laws) and 92.302 (Notification of views regarding application of Federal religious freedom and conscience laws). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 patients are not discriminated against for their pregnancy-related decisions, past, present, or future. Response: OCR appreciates the privacy concerns raised by these commenters. OCR affirms that under section 1557, covered entities may not discriminate against individuals for their pregnancy-related decisions, past, present, or future, including where the patient discloses the information or where such information is contained in medical records. Indeed, HIPAA was enacted to protect such sensitive patient health information from being disclosed without the patient’s consent or knowledge. Separately, OCR is considering revisions to the HIPAA Privacy Rule to strengthen privacy protections for individuals’ protected health information related to reproductive health care. See HIPAA Privacy Rule To Support Reproductive Health Care Privacy, notice of proposed rulemaking, 88 FR 23506 (Apr. 17, 2023). Comment: Other commenters urged OCR to address pregnancy-related conditions but to do so elsewhere in the rule, either in the provisions on what constitutes discrimination on the basis of sex (§ 92.101(a)(2)), equal program access on the basis of sex (§ 92.206(b)), or nondiscrimination in health insurance coverage (§ 92.207(b)). These commenters explained that confining the discussion of the pregnancy-related conditions to § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status) risked a narrow interpretation and application of the prohibition, and could lead providers to consider this prohibition to be limited in context and scope. Commenters emphasized that pregnancy-related protections are relevant to a wide range of conduct beyond the context of marital, parental, or familial status and should not exclude individuals who are single. Commenters also raised that pregnancyrelated discrimination applies to a broad scope of protected services, such as the decision to access certain reproductive health care services (e.g., contraception), as well as denials of reproductive services and insurance coverage. Many commenters suggested that OCR include pregnancy-related conditions in a standalone provision, because OCR could then further clarify the interplay between section 1557 and other Federal statutes or regulations related to termination of pregnancy that may apply to covered entities. Response: OCR appreciates these comments. In the 2022 NPRM, OCR considered including additional details regarding discrimination on the basis of PO 00000 Frm 00114 Fmt 4701 Sfmt 4700 ‘‘pregnancy or related conditions’’ in § 92.208 to mirror its placement to the Department’s title IX implementing regulations at 45 CFR 86.21(c), 86.40, 86.52(b), and 86.57. However, having considered the comments received, OCR concluded that the rule is better served by leaving ‘‘pregnancy or related conditions’’ in § 92.101(a)(2), which outlines the scope of discrimination on the basis of sex. The Department believes § 92.101(a)(2)—which addresses forms of sex discrimination generally—is a better location, so as to not suggest that discrimination based on pregnancy or its related conditions is limited to instances of discrimination involving only marital, parental, or family status. Comment: Many commenters supported the inclusion of pregnancyrelated conditions, but suggested additional changes to the rule, including explicit descriptions of what pregnancy or related conditions encompasses. Several commenters encouraged OCR to add language establishing that pregnancy-related conditions specifically include pregnancy termination, childbirth, false pregnancy, ectopic pregnancy, miscarriage, and recovery, including any refusal of service or procedure based on any other protected basis under the rule. Response: OCR agrees that protections for ‘‘pregnancy or related conditions’’ are critical and affirms that covered entities may not discriminate against individuals based on pregnancy or related conditions under section 1557. However, additional language to identify what the term ‘‘pregnancy or related conditions’’ means is not necessary given that the regulatory language is not intended to be exhaustive as explained above. As noted in the NPRM, OCR understands the term as including childbirth, false pregnancy, termination of pregnancy, and recovery therefrom, which are the ‘‘grounds’’ prohibited under title IX.301 87 FR 47878. Comment: Some commenters opposed the inclusion of pregnancy-related conditions. One commenter cautioned OCR to not rely on the Dobbs decision or its effects as a basis for prohibiting discrimination on pregnancy-related conditions, including pregnancy termination. Some commenters stated Dobbs held that the regulation of abortion was returned to the States, and thus, OCR cannot propose a provision that is inclusive of abortion, which would be contrary to Congressional and judicial prohibitions. Other commenters, despite acknowledging 301 45 E:\FR\FM\06MYR4.SGM CFR 86.40(a). 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations that the title IX regulations have since 1975 included ‘‘pregnancy and related conditions’’ (which includes termination of pregnancy), argued that because the term ‘‘termination of pregnancy’’ is not defined in the title IX regulations, the term should not be adopted here. A commenter suggested that OCR either not include ‘‘termination of pregnancy’’ as a pregnancy-related condition or clarify that ‘‘termination of pregnancy’’ does not include abortion because abortion is not morally equivalent to pregnancy or childbirth and should not be treated as such. Some commenters who opposed including pregnancy-related conditions argued that if the final rule includes such a term, OCR must account for its impact. Response: OCR appreciates comments regarding the inclusion of ‘‘pregnancy or related conditions,’’ including those concerns related to Dobbs. OCR is not promulgating this rule in response to Dobbs, which addressed the question of whether the Constitution provides a right to abortion. This rule does not purport to interpret the Constitution, nor does it address whether States may regulate or ban abortions. Indeed, we emphasize that section 1303 of the ACA specifically states that ‘‘[n]othing in this Act shall be construed to preempt or otherwise have any effect on State laws regarding the prohibition of (or requirement of) coverage, funding, or procedural requirements on abortions, including parental notification or consent for the performance of an abortion on a minor.’’ 42 U.S.C. 18023(c)(1). Pursuant to that provision, this rule should not be read to override any such State abortion laws. OCR reiterates that a covered provider does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the care, based on a professional or business judgement about the scope of services it wishes to offer, or for any other nondiscriminatory reason. This rule implements section 1557 of the ACA, which prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities by incorporating the ‘‘grounds prohibited under’’ title VI, title IX, the Age Act, and section 504. Under title IX, discrimination based on pregnancy has been understood to constitute sex discrimination since 1975. Consistent with this long-standing interpretation, OCR will consider complaints of sex discrimination, including discrimination based on pregnancy or related conditions, on a case-by-case VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 basis, and it will look to title IX and section 1557 case law to determine whether discrimination on the basis of sex has occurred. OCR is unaware of any instance in which a covered entity has been required to provide an abortion under title IX, title VI, the Age Act, or section 504. Consistent with this understanding of the incorporated statutes, the relevant case law, and historical practice, OCR emphasizes that a covered provider’s decision not to provide abortions is not itself sex discrimination, under section 1557. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. As noted above, a covered provider that generally offered abortion care could violate that prohibition if, for example, it generally offers or provides abortions to patients but refused to offer or provide an abortion to a particular patient because of that patient’s race or disability. But a covered provider does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. Comment: Many commenters stated that Dobbs prevents OCR from protecting access for abortion care through its proposed definition of sex, because the Supreme Court held there is no constitutional right to an abortion and returned the issue to the States. Other commenters also stated that, because Dobbs returned the issue of abortion to the States, OCR cannot create regulations that would create conflicts with State laws banning or restricting abortion. Additionally, these commenters raised section 1303 as another basis under which the ACA prohibits OCR from issuing regulations that preempt State laws regarding abortion. Other commenters raised the view that Dobbs reaffirmed Bray v. Alexandria Women’s Health Clinic, 506 U.S. 263 (1993), which held that opposition to abortion does not constitute animus against women. They contend that OCR cannot therefore define sex to include pregnancy termination. Commenters also stated that Dobbs established that there is no compelling government interest in promoting abortion, and therefore OCR has no authority to promulgate rules in support of abortion. A few commenters expressed that under the ‘‘major questions’’ doctrine, OCR cannot set an abortion policy such as prohibiting PO 00000 Frm 00115 Fmt 4701 Sfmt 4700 37635 discrimination on the basis of pregnancy termination without explicit authorization from Congress. Response: OCR appreciates the commenters’ concerns and their interpretation of Dobbs. The Dobbs opinion did not address title IX or section 1557. Dobbs nowhere prohibits OCR from issuing regulations or promulgating rules under its statutory authorities. Indeed, under section 1557, HHS is charged by Congress with the elimination of discriminatory barriers in the administration and provision of a diverse range of health programs and activities. As OCR has previously stated, this rule does not establish a Federal policy requiring or promoting abortion services. Although OCR has concluded that section 1557 does not require the Department to incorporate the language of title IX’s abortion neutrality provision, see § 92.208 (Prohibition on sex discrimination related to marital, parental, or family status), as we note throughout this preamble, OCR emphasizes that a covered provider’s decision not to provide abortions does not itself constitute discrimination in violation section 1557. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. It bears emphasis that nothing in the ACA, including section 1557, has ‘‘any effect on Federal laws regarding—(i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A). In addition, nothing in the ACA, including section 1557, preempts or has any effect on State laws regarding ‘‘the prohibition of (or requirement of) coverage, funding, or procedural requirements on abortions’’ as provided in section 1303 of the ACA, 42 U.S.C. 18023(c)(1). OCR’s interest is protecting individuals against prohibited forms of discrimination under section 1557 when accessing the range of health programs and activities covered under the statute. OCR also disagrees that the ‘‘major questions’’ doctrine is implicated by its promulgation of rules that protect individuals from discrimination on the basis of sex consistent with the manner in which the term has long been interpreted in the title IX context. Comment: Many commenters stated that Dobbs had—and continues to have—a significant impact that warrants section 1557’s protections against E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37636 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations discrimination on the basis of pregnancy or related conditions. Many commenters discussed that Dobbs limited access to abortion nationwide and created a complex web of State laws that ban or severely restrict access to care. These commenters stated that certain communities, including people of color, people with low incomes, immigrants, young people, people with disabilities, and LGBTQI+ individuals are most likely to face legal barriers to accessing abortion care, including an increased threat of arrest and prosecution in States hostile to abortion. Many commenters also posited that States’ efforts to restrict access to abortion have resulted in further challenges to accessing other reproductive health care, including contraception, fertility care and treatment, and miscarriage or early pregnancy loss management. Commenters cited examples from multiple States where women experiencing miscarriages have been denied care even as their pregnancyrelated complications threaten their health and lives. Response: OCR understands commenters’ concerns regarding the negative health impacts stemming from the Dobbs decision, including on those with pregnancy-related conditions. We emphasize, as we have repeatedly throughout this preamble, that this rule is neither a response to Dobbs nor affected by that decision. This rule rests on the application of section 1557’s nondiscrimination prohibition, and the longstanding interpretation of title IX’s prohibition on sex discrimination to include discrimination on the basis of pregnancy and related conditions. Comment: Many commenters raised concerns about access to prescriptions related to contraception, miscarriages or early pregnancy loss, and medication abortion. Commenters also raised concerns about access to drugs prescribed to treat conditions like chronic disease or illness that are unrelated to abortion, but may have the effect of terminating a pregnancy. Some commenters explained that pharmacists are fearful about dispensing medications that could terminate a pregnancy even when the medication is not prescribed for the purpose of abortion, and in some instances, pharmacists have refused to fill prescriptions in certain States that have banned abortion. In States that have banned abortion, commenters noted that physicians, health care providers, and pharmacists fear they will be criminally prosecuted under State law, leading to denials or delays in lawful access to medications to treat conditions unrelated to abortion. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 For instance, many commenters explained that certain drugs prescribed to treat health conditions such as cancer, arthritis, ulcers, autoimmune diseases, or other chronic conditions are being denied or limited because they can result in termination of a pregnancy. Specifically, commenters relayed that some treatments for conditions such as breast cancer, brain cancer, prostate cancer, alcoholism, post-traumatic stress disorder, and depression involve drugs that are being denied because of an indirect potential relationship with pregnancy termination. Similarly, many commenters requested clarification that section 1557’s prohibitions on discrimination protect access to contraception in the retail pharmacy setting. They raised concerns and described instances where individuals are denied access to hormonal contraception at a pharmacy that provides other forms of contraceptives. Some commenters opined that a pharmacy’s refusal to provide prescribed medication to enable IUD (intrauterine device) insertion, or to treat an incomplete miscarriage, should be considered a section 1557 violation. Commenters were concerned that such discrimination is not only sex and disability discrimination, but also creates additional and unnecessary barriers to prescription drugs that people need to live and maintain their health. For example, many commenters discussed that people with disabilities are increasingly denied or subjected to barriers to obtaining methotrexate, which is a prescription drug used to treat cancer and autoimmune conditions, because of the drug’s potential effects on pregnancy. Many commenters explained that a pharmacist’s refusal to fill an individual’s prescription or a pharmacist’s decision to not stock a specific drug or class of drugs inevitably harms persons with disabilities and women, especially those experiencing miscarriages and early pregnancy loss. They stated that women are also more likely than men to have autoimmune diseases for which many of these drugs are prescribed. Response: OCR appreciates comments relating to access to lawfully prescribed and medically necessary medications. To start, OCR notes that, on September 29, 2023, after the close of the comment period for this rule, OCR issued revised guidance to pharmacies that supersedes the guidance referred to by some commenters.302 If a covered entity 302 See U.S. Dep’t of Health & Hum. Servs., Guidance to the Nation’s Retail Pharmacies: Obligations Under Federal Civil Rights Laws to PO 00000 Frm 00116 Fmt 4701 Sfmt 4700 denies or delays lawful access to medications to support persons with disabilities, treat cancer, or treat an autoimmune condition, that refusal could violate section 1557 if, for example, the refusal is on the basis of a prohibited ground, such as the person’s race, age, disability, or sex. But, as OCR clarified in its updated guidance to the nation’s pharmacies, section 1557 does not require pharmacies to fill prescriptions for medication for the purpose of abortion, nor does the guidance suggest or imply an obligation of pharmacies to fill prescriptions for medication in violation of State laws, including those banning or restricting abortion.303 OCR provided several examples in the guidance, in which denying lawfully prescribed medication to customers may violate civil rights laws.304 For example, where a treating physician diagnoses a miscarriage complicated by a uterine infection and orders an antibiotic to treat a patient’s chills, fever, and vaginal bleeding, a pharmacy that refuses to provide the antibiotic because of concern that subsequent care may include an abortion may be discriminating on the basis of sex. OCR will evaluate and apply all applicable statutory protections, including relevant religious freedom and conscience protections, on a case-by-case basis. In addition, the ACA is hardly silent on the issue of abortion. It contains an elaborate set of rules for when and how a qualified health plan may refuse or be prohibited from providing or paying for certain abortions. See 42 U.S.C. 18023(a)–(b). It further specifies that State laws regarding abortion are not preempted and that ‘‘nothing in this act shall be construed to have effect on federal laws regarding—(i) conscience protections; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of willingness or refusal to provide, pay Ensure Nondiscriminatory Access to Health Care at Pharmacies, (Sept. 29, 2023), https://www.hhs.gov/ civil-rights/for-individuals/special-topics/ reproductive-healthcare/pharmacies-guidance/ index.html. On April 5, 2024, the court in State of Texas v. Becerra et al., No. 7:23–cv–00022–DC, Order for S.J., ECF No. 69 (W.D. Tex.), held that the revised guidance mooted plaintiffs’ legal challenge to the superseded guidance. 303 See U.S. Dep’t of Health & Hum. Servs., Guidance to Nation’s Retail Pharmacies: Obligations under Federal Civil Rights Laws to Ensure Nondiscriminatory Access to Health Care at Pharmacies (September 29, 2023), https:// www.hhs.gov/civil-rights/for-individuals/specialtopics/reproductive-healthcare/pharmaciesguidance/ (‘‘nor does the guidance suggest or imply an obligation of pharmacies to fill prescriptions for medication in violation of State laws, including those banning or restricting abortion’’). 304 Id. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ Id. at 18023(c). Comment: OCR sought comment on the title IX abortion neutrality provision’s inclusion and on other possible readings of that provision. Although OCR also sought comment on whether the Department should align its title IX regulation regarding the abortion neutrality provision of title IX with the 2000 ‘‘Common Rule’’ version of that regulatory provision that more than 20 agencies have long adopted,305 no comments addressed this specifically. Many commenters supported OCR’s proposal to not import the language of title IX’s abortion neutrality provision into section 1557’s final rule. Doing so, they contended, would undermine and be contrary to OCR’s implementation of section 1557, which is to eliminate barriers and expand access to health care and coverage. These commenters discussed how abortion is a critical form of health care and patients seek or need to terminate a pregnancy for a wide variety of reasons. Response: OCR’s determination to not incorporate title IX’s abortion neutrality provision is based on our conclusion that doing so is not required and unnecessary as the ACA itself speaks to this issue. The ACA provides that nothing in the statute, including section 1557, has ‘‘any effect on Federal laws regarding (i) conscience protection; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ 42 U.S.C. 18023(c)(2)(A). By contrast, the ACA does not contain specific language 305 See 65 FR 52869 (Aug. 30, 2000); see also, e.g., 28 CFR 54.235(d)(1) (DOJ regulation). The agencies that have adopted the Common Rule include: Agency for International Development, 22 CFR part 229; Corporation for National and Community Service, 45 CFR part 2555; Department of Agriculture, 7 CFR part 15d.; Department of Commerce, 15 CFR part 8a; Department of Defense, 32 CFR part 196; Department of Energy, 10 CFR part 1040; Department of Homeland Security, 6 CFR part 17; Department of Housing and Urban Development, 24 CFR part 3; Department of the Interior, 43 CFR part 41; Department of Justice, 28 CFR part 54; Department of Labor, 29 CFR part 36; Department of State, 22 CFR part 146; Department of Transportation, 49 CFR part 25; Department of the Treasury, 31 CFR part 28; Department of Veterans Affairs, 38 CFR part 23; Environmental Protection Agency, 40 CFR part 5; Federal Emergency Management Agency, 44 CFR part 19; General Services Administration, 41 CFR part 101– 4; National Aeronautics and Space Administration, 14 CFR part 1253; National Archives and Records Administration, 36 CFR part 1211; National Science Foundation, 45 CFR part 618; Nuclear Regulatory Commission, 10 CFR part 5; Small Business Administration, 13 CFR part 113; and Tennessee Valley Authority, 18 CFR part 1317. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 directing the incorporation of title IX’s abortion neutrality provision. That section 1557 does not require its incorporation is therefore the better reading of the statute with regard to title IX. We reiterate, moreover, that this rule does not—and indeed, cannot—create a right to abortion; it operates only to prohibit discrimination on specific prohibited grounds. Comment: Several commenters highlighted the differences between section 1557’s coverage of health care from title IX’s coverage of education because the decision to receive health care from a particular provider is often driven by factors, including geographic location, cost, insurance coverage, the type of care being sought, and the urgency of that care. Many other commenters stated that importing title IX’s abortion neutrality provision would allow denials of care that can directly harm patients, including putting at risk a patient’s life or health. Response: OCR agrees with commenters that health care is fundamentally different from education. And although section 1557 incorporates ‘‘the ground prohibited under’’ title IX and the ‘‘enforcement mechanisms provided for and available under’’ that statute, 42 U.S.C. 18116(a), it does not incorporate title IX’s other provisions. Title IX’s abortion neutrality provision does not purport to define what constitutes prohibited sex discrimination under title IX—the ‘‘ground prohibited’’ under that statute—and it is not an enforcement mechanism; it provides only that nothing in title IX shall be construed to require or prohibit any person or entity to provide or pay for abortion or related benefit or service. Congress made clear that the ACA, including section 1557, would have no effect on several specific Federal laws protecting individuals and entities that refuse to provide abortions. See 42 U.S.C. 18023(c)(2)(A). The ACA itself restates provisions of longstanding Federal law by making clear in 18023(c)(2)(A) that ‘‘nothing in this act shall be construed to have effect on federal laws regarding—(i) conscience protections; (ii) willingness or refusal to provide abortion; and (iii) discrimination on the basis of willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion.’’ These provisions reiterate existing Federal restrictions on abortion. For example, the Weldon Amendment forbids funds appropriated to HHS from being ‘‘made available to a Federal agency or program, or to a State or local government, if such PO 00000 Frm 00117 Fmt 4701 Sfmt 4700 37637 agency, program, or government subjects any institutional or individual health care entity to discrimination on the basis that the health care entity does not provide, pay for, provide coverage of, or refer for abortions.’’ 306 The CoatsSnowe Amendment forbids discriminating against an entity that refuses to undergo training in performance of or referrals for abortions.307 The Church Amendment forbids requiring any individual ‘‘to perform or assist in the performance of any part of a health service program . . . if his performance or assistance in the performance of such part of such program . . . would be contrary to his religious beliefs or moral convictions.’’ 308 It also provides that an entity’s receipt of any grant, contract, loan, or loan guarantee under the Public Health Service Act, the Community Mental Health Centers Act, or the Developmental Disabilities Services and Facilities Construction Act ‘‘does not authorize any court or any public official or other public authority to require . . . such entity to . . . make its facilities available for the performance of any sterilization procedure or abortion if the performance of such procedure or abortion in such facilities is prohibited by the entity on the basis of religious beliefs or moral convictions.’’ 309 The Church Amendments also prohibit discrimination against health care personnel related to their employment or staff privileges because they ‘‘performed or assisted in the performance of a lawful sterilization procedure or abortion.’’ 310 The same nondiscrimination protections also apply to health care personnel who refuse to perform or assist in the performance of sterilization procedures or abortion.311 In addition, some of HHS’s programs and services are specifically governed by abortion restrictions in the underlying statutory authority or program authorization.312 The ACA also contains a variety of ‘‘special rules’’ that apply specifically to 306 Consol. Appropriations Act, 2024, Public Law 118–47, div. H, tit. V, section 507(d)(1), 138 Stat. 460, 703 (Mar. 23, 2024). See also, e.g., id. sections 506–07, 138 Stat. 460, 703 (Hyde Amendment provisions). 307 42 U.S.C. 238n(a). 308 42 U.S.C. 300a–7(d). 309 42 U.S.C. 300a–7(b)(2)(A). 310 42 U.S.C. 300a–7(c)(1); see also U.S. Dep’t of Health & Hum. Servs., Guidance on Nondiscrimination Protections under the Church Amendments, https://www.hhs.gov/conscience/ conscience-protections/guidance-churchamendments-protections/. 311 42 U.S.C. 300a–7(c)(1). 312 See, e.g., title X of the PHS Act, 24 U.S.C. 300a–6; section 1303(b)(4) of the ACA, 42 U.S.C. 18023. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37638 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations abortion coverage and services.313 Each of these laws continues to apply and is not affected by this rule. Accordingly, it is not necessary to incorporate title IX’s abortion neutrality provision. OCR emphasizes that a covered provider’s decision not to provide abortions or abortion coverage does not itself constitute discrimination in violation section 1557. As described above, section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in covered health programs or activities. As such there may be nondiscriminatory reasons for a provider not to offer abortion care or coverage. A covered entity does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. Comment: Many commenters who supported OCR’s proposal noted that section 1557 does not require incorporation of title IX’s abortion neutrality provision because if Congress wanted to include such a provision, it would have done so either by explicitly referencing title IX’s abortion neutrality provision or by including text matching 20 U.S.C. 1688. Commenters suggested that silence on the incorporation or importation of title IX’s abortion neutrality provision is not an oversight on the part of Congress, but instead an intentional decision, as Congress legislates with knowledge of the basic rules of statutory construction. Many commenters stated that the Congressional drafters of section 1557 did not pick and choose among the multiple title IX exceptions, including those specific to military training, admissions decisions, and membership practices of certain tax-exempt organizations, and that there is no justification for OCR to do so either. They maintained that the statute only references title IX for the prohibition of sex discrimination. Commenters also said there was no need to import title IX’s abortion neutrality provision given the availability of existing Federal statutory protections for covered entities and individuals who object to the provision, payment, or referral of abortion services. Many commenters noted that OCR proposed a process in which a covered entity could seek an exemption based on conscience or religious conflicts. These commenters argued that, where permitted by 313 See 42 U.S.C. 18023(b). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 relevant Federal laws, such analysis by OCR would also account for any potential harm to third parties. Response: For the reasons we set forth above, OCR maintains that importing title IX’s abortion neutrality provision in this rule is not legally required by the statute. Comment: Other commenters who supported not importing the title IX abortion neutrality provision suggested that the final rule should include the Proposed Rule’s discussion that EMTALA protects emergency care for pregnancy-related conditions, including termination of pregnancy. Some commenters expressed that the final rule should make clear that section 1557 incorporates section 1303(d) of the ACA, 42 U.S.C. 18023(d), which states that nothing in title I of the ACA relieves any health care provider from providing emergency services as required by EMTALA. Response: OCR does not enforce EMTALA and directs commenters to the discussion of EMTALA under § 92.3. OCR notes that the 2022 NPRM’s discussion of EMTALA does not alter any requirements under section 1557, EMTALA’s existing obligations, or the Department’s previous guidance regarding EMTALA. Nothing in this rule changes or otherwise affects any health care provider’s obligations with respect to EMTALA, including with respect to the rights, remedies, procedures, or legal standards available to individuals and entities under section 1303(c) of the ACA. Comment: Many commenters objected to OCR’s proposal that it was not required to import title IX’s abortion neutrality provision in this rule. These commenters argued that the provision must be included to explicitly address that section 1557 and its implementing regulations are abortion neutral. Some commenters maintained that the 2022 NPRM’s request for comment on whether ‘‘it could be beneficial to include a provision specifically prohibiting discrimination on the basis of pregnancy-related conditions as a form of sex-based discrimination,’’ 87 FR 47879, constituted an ‘‘abortion mandate’’ that would discriminate against providers and covered entities who object to abortion. Some commenters stated that the inclusion of ‘‘pregnancy or related conditions’’ as a form of sex discrimination without importing title IX’s abortion neutrality provision would strip providers of their ability to object to pregnancy terminations. Some commenters acknowledged that other Federal laws exist to protect religious freedom and conscience, but nevertheless expressed PO 00000 Frm 00118 Fmt 4701 Sfmt 4700 concerns that absent the provision’s adoption of title IX’s abortion neutrality provision, health care providers and entities with religious objections would be left without protections and would be forced to provide, cover, pay, or refer for abortion services. Response: OCR appreciates commenters’ concerns, but for the reasons stated above, we disagree. A covered entity does not engage in discrimination prohibited by section 1557 if it declines to provide, pay for, cover, or refer for abortions based on religious or conscience objections to performing the procedure. OCR also intends to enforce and comply with all applicable religious freedom and conscience protections, including section 1303 of the ACA, the Weldon, Church, and Coats-Snowe amendments, RFRA, and other applicable religious freedom and conscience laws. We have added a procedure for recipients whereby they may rely on such protections or seek assurance of those protections, if they wish. See § 92.302. Comment: Other commenters who objected to the Department’s position contended that, on the one hand, OCR was relying on title IX’s regulations to prohibit discrimination on pregnancyrelated conditions, while, on the other hand, ignoring title IX’s statutory abortion neutrality provision and religious exception. These commenters argued that OCR is arbitrarily and capriciously picking and choosing which provisions of title IX to implement. They stated that, under title IX, declining to provide or pay for any service related to abortion is not treated as prohibited sex discrimination and therefore it cannot be that the same action, under section 1557, could constitute prohibited sex discrimination. Several commenters argued that the abortion neutrality provision, unlike title IX’s exceptions, is a rule of construction that applies to all of title IX, including the statute’s prohibition on sex discrimination, and thus OCR must incorporate the provision into any section 1557 implementing regulations. Response: OCR appreciates commenters’ concerns. As we explained above, however, section 1557 incorporates some, but not all, parts of title VI, title IX, the Age Act, and section 504. Specifically, section 1557 incorporates the ‘‘ground’’ of discrimination and the ‘‘enforcement mechanisms’’ under the referenced statutes, including title IX. Section 1557 is best read to incorporate existing interpretations of what constitutes sex discrimination under title IX, including regulatory interpretations and case law. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations But section 1557 does not incorporate provisions of title IX or that statute’s regulations that do not define or interpret what constitutes a ground of discrimination or an enforcement mechanism. Those provisions include the religious exception and the abortion neutrality provision. This reading gives meaning to every term in section 1557, while recognizing that although the statute incorporates parts of other civil rights statutes, each statute addresses distinct issues and contexts. Title IX’s abortion neutrality provision is a rule of construction as to what acts can be required of recipients under title IX, but nothing in the provision states that it construes what constitutes a ground of prohibited discrimination. In section 1557, Congress was explicit in the limited incorporation of title IX when it listed only the ground to be prohibited by itle IX and the enforcement mechanisms that apply, and the title IX abortion neutrality provision is not an enforcement mechanism. Comment: Many commenters stated that OCR’s proposal to not import the title IX abortion neutrality provision is contrary to Congress’s intent when it drafted section 1557 and explicitly adopted by reference the entire title IX scheme under 20 U.S.C. 1681 et seq. Commenters stated that enactment of title IX did not simply prohibit sex discrimination, because at least two categories of conduct are not, in Congress’s view, what constitutes sex discrimination for purposes of title IX— religious decisions by an entity that conflict with the terms of title IX and the refusal to provide or pay for abortion. In their view, this means that OCR cannot prohibit discrimination based on termination of pregnancy or abortion as a form of sex discrimination. Response: OCR appreciates commenters’ concerns but disagrees that the manner in which Congress chose to cite title IX in section 1557 indicates an intent to limit what constitutes discrimination of the basis of sex for the reasons stated above. OCR specifically disagrees that the inclusion of ‘‘et seq.’’ indicates Congress’s intent to incorporate the entire statute, thereby negating Congress’s use of the terms ‘‘ground prohibited’’ and ‘‘enforcement mechanisms’’ when describing which portions of title IX shall be incorporated in section 1557. Moreover, as discussed in detail above (see Treatment of the Title IX Religious Exception), OCR’s analysis considers the entire statute, including title IX’s specific limitation to the context of educational programs and activities. Comment: Commenters argued that title IX’s adoption by reference supports VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Congress’s longstanding position to legislate in a manner that remains neutral with respect to abortion. In support of this view, some commenters pointed to the Pregnancy Discrimination Act of 1978, where Congress prohibits discrimination on the basis of pregnancy, childbirth, or related medical conditions, but also explicitly included an exemption for health insurance benefits for abortion which, in their view, demonstrates Congress’s intent to remain neutral on abortion. Response: OCR will adhere to the specific terms Congress enacted in section 1557 as well as other applicable Federal laws, including section 1303 of the ACA, the Weldon, Church, and Coats-Snowe amendments, RFRA, and other applicable religious freedom and conscience laws. Comment: Other commenters who objected to OCR’s proposal not to import title IX’s abortion neutrality provision in the rule expressed concern that OCR ignored section 1303 of the ACA, 42 U.S.C. 18023, which they opine requires abortion neutrality throughout the ACA. For example, commenters discuss that section 1303(a), which gives States the option to prohibit abortion coverage in health plans, would be rendered meaningless if the final rule requires such coverage by either prohibiting discrimination on the basis of pregnancy-related conditions or by failing to include a provision establishing section 1557’s abortion neutrality. Commenters stated that section 1303 forecloses any construction of section 1557 that would require the provision or coverage of abortion. Response: OCR appreciates commenters’ concerns regarding section 1303’s applicability to section 1557. Section 1303(a) provides that States and qualified health plans may, to the extent allowed by State law, opt to offer or prohibit abortion coverage; it does not require that section 1557 to import the language of title IX’s abortion neutrality provision. Section 1303 primarily grants States flexibility to decide whether qualified health plans sold through their respective Exchanges can include coverage benefits for abortion services. See 42 U.S.C. 18023(a) (‘‘State opt-out of abortion coverage’’). And, unless otherwise prohibited by State law, participating issuers may elect to cover abortion services in qualified health plans. For qualified health plans that elect to offer as a coverage benefit abortion services for which Federal funding is prohibited, section 1303 establishes separate accounting requirements to ensure Federal funds are segregated and maintained separate from a policy holder’s out-of-pocket PO 00000 Frm 00119 Fmt 4701 Sfmt 4700 37639 funds, which may pay for abortion coverage. 42 U.S.C. 18023(b)(2)(B)–(C). OCR acknowledges that section 1303 allows qualified health plans the independence to choose whether to provide abortion coverage where consistent with State law, but it does not command that the final rule import title IX’s abortion neutrality provision. OCR reiterates, moreover, that a covered provider’s decision not to provide abortions or abortion coverage does not itself constitute discrimination in violation of section 1557. A covered entity that generally offered abortion care could violate section 1557 if, for example, it refused to provide an abortion to a particular patient because of their race or disability. But a covered provider does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure, based on a professional or business judgment about the scope of the services it wishes to offer, or for any other nondiscriminatory reason. Further, OCR maintains that importing title IX’s abortion neutrality provision is not required given the recognition of the ACA provisions on abortion and the inclusion of those provisions in regulatory text. Comment: Several commenters pointed to the Weldon and Church Amendments to assert that OCR does not have the authority to prohibit discrimination on the basis of pregnancy termination and requested that OCR include title IX’s abortion neutrality provision to avoid any uncertainty on the issue. Other commenters urged OCR to include affirmative language in the final rule that section 1557 does not require the provision of, referral for, or coverage of abortion to eliminate any uncertainty maintained by many religious providers. Response: OCR remains committed to upholding the Federal laws, including the abortion and conscience provisions of the ACA itself, the Church, CoatsSnowe, and Weldon Amendments; the generally applicable requirements of RFRA; and other applicable Federal laws that provide protection to covered entities. It is not necessary to include title IX’s abortion neutrality provision in the final rule to provide certainty as to the safeguards in place to protect religious freedom and conscience. As discussed, a covered entity does not engage in discrimination prohibited by section 1557 if it declines to provide abortions based on religious or conscience objections to performing the procedure. Also, we refer again to the process described at § 92.302, whereby E:\FR\FM\06MYR4.SGM 06MYR4 37640 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 providers may rely on the protections in Federal law for religious freedom and conscience or seek assurance of such protections from OCR, if they wish. Comment: Many commenters who objected to OCR’s proposal not to import title IX’s abortion neutrality provision in this rule expressed concern regarding the Proposed Rule’s discussion of EMTALA and emergency medical conditions that may necessitate abortion. Some commenters opined that the Proposed Rule’s preamble was a potential regulatory change by HHS to designate an ‘‘abortion mandate’’ in EMTALA. Some commenters also noted that such an ‘‘abortion mandate’’ meant that HHS could preempt State laws that prohibit abortion or alter State licensing and health and safety laws. Other commenters raised the ‘‘major questions’’ legal doctrine to conclude that Congress would not have granted HHS the authority to promulgate such rules that would rewrite the text of EMTALA on any grounds, including on the issue of abortion. Response: These comments fall outside the scope of the final rule. To be clear, EMTALA does not alter any of section 1557’s requirements, and this rule does not alter existing obligations under EMTALA, or any of the Department’s previous guidance regarding EMTALA. Thus, nothing about the final rule imposes any change to EMTALA’s statutory scheme, let alone a ‘‘radical or fundamental change’’ such that the major questions doctrine is implicated.314 Further, commenters’ view that the ‘‘major questions’’ legal doctrine applies is also misplaced. The ‘‘major questions’’ doctrine applies in certain ‘‘extraordinary cases’’ in which courts will refuse to defer to agency action it considers having ‘‘vast economic and political significance’’ absent express authorization from Congress.315 As described, the final rule does not alter any existing obligations or guidance as to EMTALA. The ‘‘major questions’’ doctrine is not relevant here. Additionally, there is no basis for commenters’ concerns about a potential regulatory change or preemption of State laws, including those involving licensing and health and safety. Per the 314 West Virginia v. EPA, 597 U.S. 697, 723 (2022). 315 West Virginia v. EPA, 597 U.S. at 716 (Invalidating the Environmental Protection Agency’s plan to require power plants to shift from coal to renewables, reducing gross domestic product by at least a trillion dollars within two decades); Nat’l Fed. of Indep. Business v. OSHA, 142 S. Ct. 661, 665 (2022) (per curiam) (Invalidating the Occupational Safety and Health Administration order requiring ‘‘84 million Americans to either obtain a COVID–19 vaccine or undergo weekly medical testing’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 ACA itself, this rule does not override State laws regarding ‘‘the prohibition of (or requirement of) coverage, funding, or procedural requirements on abortions’’ or alter preexisting obligations under Federal law. See 42 U.S.C. 18023(c)(1), (d). Comment: Other commenters stated that the Franciscan Alliance opinion vacating provisions similarly related to pregnancy-related conditions in the 2016 Rule precludes OCR from issuing this final rule with similar provisions that do not import title IX’s abortion neutrality provision. Some commenters maintained that if OCR promulgates this rule with similar provisions, OCR risks being held in contempt of court. Other commenters stated that to adequately issue this final rule, OCR must explain why the holdings of the Franciscan Alliance court are incorrect or inapplicable to this rulemaking. Response: OCR appreciates commenters’ concerns, but notes that they mischaracterize the impact of the relief ordered in Franciscan Alliance on this rulemaking. The Franciscan Alliance court vacated a portion of the 2016 Rule—namely its interpretation of sex discrimination to include gender identity and termination of pregnancy.316 The court also enjoined the Federal Government from interpreting or enforcing section 1557 or any related implementing regulations against the plaintiffs in that particular case in a manner that would require those plaintiffs to perform or provide insurance coverage for gender-transition procedures or abortions.317 The court’s orders have no effect on, and do not apply to, OCR’s authority to promulgate new regulations, including this final rule, and to enforce those regulations against covered entities that were not plaintiffs in Franciscan Alliance. The instant rulemaking is new and includes significant changes that address concerns raised against the 2016 Rule in Franciscan Alliance. Also notable is the fact that § 92.302 outlines new procedures whereby persons may rely on the protections of Federal conscience or religious freedom laws or choose to seek assurance of such protections, if they wish. And OCR has issued a separate final rule codifying safeguards for Federal conscience protections. See 89 FR 2078 (Jan. 11, 2024). In addition, OCR has considered the legal and factual developments since the issuance of the 2016 Rule, which help to inform its decisions in this final rule. 316 Franciscan All., Inc. v. Azar, 414 F. Supp. 3d 928, 945–47 (N.D. Tex. 2019). 317 Franciscan All., Inc. v. Becerra, 553 F. Supp. 3d 361, 378 (N.D. Tex. 2021). PO 00000 Frm 00120 Fmt 4701 Sfmt 4700 Therefore, OCR’s promulgation of its new regulation in no way contravenes the Franciscan Alliance court’s orders, and OCR will comply with that court’s orders, and all other applicable orders, in enforcing this final rule. OCR thus disagrees that issuing this rule puts the agency at risk of being held in contempt, merely for acting within the authority that has been lawfully delegated to HHS under section 1557. Comment: Some commenters requested that OCR provide clarification, either in a final rule or via sub-regulatory guidance, as to how the proposed pregnancy discrimination protections relate to and may be different from those guaranteed by the Pregnancy Discrimination Act of 1978. Response: OCR appreciates these commenters’ request and is intent on providing clear guidance on the scope of the final rule and its application through educational outreach efforts, trainings, and individualized assistance. OCR clarifies that it does not enforce the Pregnancy Discrimination Act of 1978, Public Law 95–555, which amended title VII, and applies to discrimination on the basis of pregnancy, childbirth, or related medical conditions in employment settings, while section 1557 applies to health programs or activities that receive Federal financial assistance. We also note that section 1557, title IX, and title VII are read consistently to apply similar protections in the different contexts in which they apply. Comment: Other commenters expressed concern that Dobbs created tension between health care providers and patients, increasing distrust in providers. Commenters also stated that Dobbs has created chaos in the health care system, increasing the risk that patients will experience discriminatory care and suffer delays in lifesaving treatment as a direct result of legal and medical uncertainty. These commenters said that discrimination in care propagates more distrust, which is a significant barrier for individuals seeking care and is precisely what section 1557 was designed to protect against. Response: OCR appreciates the commenters’ concerns. OCR understands that the provider-patient relationship is critical to the provision of quality, competent health care and critical for achieving optimal health. For example, in proposing the policies and procedures required under § 92.8, OCR confirmed that patients value the ability to have their concerns directly heard by E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations their provider,318 and understands that not all communities in the United States feel the same level of trust in their health care provider, particularly among racially and ethnically diverse communities.319 OCR further recognizes that in light of Dobbs, in certain States, a patient may fear sharing critical information relevant to their health status. OCR is separately considering revisions to the HIPAA Privacy Rule to strengthen privacy protections for individuals’ protected health information related to reproductive health care, which will assist in generating more trusting patientprovider relationships. See HIPAA Privacy Rule To Support Reproductive Health Care Privacy, notice of proposed rulemaking, 88 FR 23506 (Apr. 17, 2023). Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.208, with modification. For clarity, we are finalizing by adding a cross-reference to § 92.101(a)(2)’s description of sex discrimination. ddrumheller on DSK120RN23PROD with RULES4 Nondiscrimination on the Basis of Association (§ 92.209) In § 92.209, we proposed prohibiting discrimination against an individual on the basis of the race, color, national origin, sex, age, or disability of an individual with whom the individual is known to have a relationship or association. The comments and our responses regarding proposed § 92.209 are set forth below. Comment: Commenters on this provision overwhelmingly expressed support for the inclusion of an explicit prohibition on associational discrimination, which many stated will protect individuals, including children and elders, who associate with LGBTQI+ individuals. Other commenters said that a prohibition of associational discrimination will also protect individuals and families who associate with an individual who has a 318 Leslie Read et al., The Deloitte Ctr. for Health Solutions, Rebuilding Trust in Health Care: What Do Consumers Want—and Need—Organizations to Do?, p. 3 (2021) (‘‘62% [of surveyed people of color] want their local hospitals to ensure patients have a voice to relay their experiences and take action to address their problems.’’), https:// www2.deloitte.com/us/en/insights/industry/healthcare/trust-in-health-care-system.html. 319 Leslie Read et al., The Deloitte Ctr. for Health Solutions, Rebuilding Trust in Health Care: What Do Consumers Want—and Need—Organizations to Do? (2021); https://www2.deloitte.com/us/en/ insights/industry/health-care/trust-in-health-caresystem.html. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 history of drug use or substance use disorder (SUD). Some commenters noted that the 2020 Rule repealed the 2016 Rule’s associational discrimination protections at former 45 CFR 92.209, despite comments urging OCR to maintain the provision. Many commenters noted that courts have recognized an individual’s right to be free from discrimination based on their association with another an individual protected on one or more bases under section 1557.320 320 Falls v. Prince George’s Hosp. Ctr., No. Civ. A 97–1545, 1999 WL 33485550 at *11 (D. Md. Mar. 16, 1999) (holding that parent had an associational discrimination claim under section 504 when hospital required hearing parent to act as interpreter for child who was deaf); Holcomb v. Iona Coll., 521 F.3d 130 (2nd Cir. 2008) (an employee has a cognizable title VII claim against an employer who takes an adverse action against the employee because of the employee’s association with a person of another race); Larimer v. Int’l Bus. Machines Corp., 370 F.3d 698, 702 (7th Cir. 2004) (the court affirmed lower court’s summary judgment in favor of defendant employer, in part, because plaintiff employee’s employment claim did not fit into any one of three recognized categories of associational discrimination under the ADA); Loeffler v. Staten Island Univ. Hosp., 582 F.3d 268, 279 (2d. Cir. 2009) (court permitted associational discrimination claim brought by deaf father’s children who were forced to interpret for him in the hospital); Mx Grp., Inc. v. City of Covington, 293 F.3d 326, 335 (6th Cir. 2002) (holding a drug and alcohol treatment center that was wrongfully denied a zoning permit because it provided services to individuals with disabilities was subjected to discrimination under title II of the ADA); Barrett v. Whirlpool Corp., 556 F.3d 502, 512 (6th Cir. 2009) (title VII and sec. 1981 forbid employment discrimination on the basis of association with or advocacy for a protected party); Tetro v. Elliot Popham Pontiac, Oldsmobile, Buick, & GMC Trucks, Inc., 173 F.3d 988, 994–95 (6th Cir. 1999) (court reversed lower court’s dismissal of plaintiff’s associational discrimination claim because title VII prohibits such discrimination); Deffenbaugh-Williams v. Wal-Mart Stores, Inc., 156 F.3d 581, 589 (5th Cir. 1998) (court upheld jury’s determination that employer wrongfully terminated employee based on employee’s association with a Black person) vacated in part on other grounds by Williams v. Wal-Mart Stores, Inc., 182 F.3d 333 (5th Cir. 1999) (en banc); Parr v. Woodmen of the World Life Ins. Co., 791 F.2d 888, 892 (11th Cir. 1986) (trial court erred in dismissing plaintiff’s associational discrimination claim because § 1981 prohibits associational discrimination); Hively v. Ivy Tech Cmty. Coll. of Ind., 853 F.3d 339, 345 (7th Cir. 2017) (finding plaintiff had a case for sex discrimination in part based on the gender and orientation of her partner); Zarda v. Altitude Express, 883 F.3d 100, 124 (2d Cir. 2018), (court held that prohibition of associational discrimination applies with equal force to all the classes protected by title VII); Videckis v. Pepperdine Univ., 150 F. Supp. 3d 1151, 1161 (C.D. Cal. 2015) (sexual orientation discrimination is sex discrimination in part because it involves treatment that was based on the sex of the person(s) with whom the individual associates); Baldwin v. Foxx, 2015 WL 4397641 (EEOC July 15, 2015) (‘‘Sexual orientation discrimination is also sex discrimination because it is associational discrimination on the basis of sex.’’); Kauffman v. Maxim Healthcare Servs., Inc., No. 04–CV–2869, 2006 WL 1983196, at *3 (E.D.N.Y. July 13, 2006) (‘‘Although Defendant correctly points out that the Second Circuit has not recognized as valid causes of action third-party claims of association PO 00000 Frm 00121 Fmt 4701 Sfmt 4700 37641 Response: OCR agrees that it is important to include an explicit provision addressing associational discrimination, as both consistent with courts’ interpretation of what constitutes discrimination as well as to protect those experiencing such forms of discrimination.321 As commenters noted, this particularly impacts LGBTQI+ people because significant numbers of children and elders live with or are cared for by LGBTQI+ people,322 and some providers have refused to provide health care to children, for example, because their parents are gay or lesbian.323 This is discrimination or retaliation like those presented in the instant case, there is nevertheless a wealth of support in the prior decisions of the courts in this Circuit and our highest Court for recognizing these types of claims.’’). 321 See Kengerski v. Harper, 6 F.4th 531, 537–539 (3d Cir. 2021) (a white plaintiff employee’s claim is justiciable under an associational discrimination legal theory under title VII of the Civil Rights Act of 1964, where his employer retaliated against him for complaining about a supervisor’s racist remarks directed at the employee’s biracial family member and other minority coworkers); Kelleher v. Fred A. Cook, Inc., 939 F.3d 465, 469–470 (2d Cir. 2019) (an employer’s reaction to a non-disabled employee’s reasonable accommodation request to care for disabled dependent can support an inference of associational discrimination); McGinest v. GTE Serv. Corp., 360 F.3d 1103, 1118 (9th Cir. 2004) (case involving indirect comments in the workplace that crossed racial lines, noting that ‘‘Title VII has . . . been held to protect against adverse employment actions taken because of the employee’s close association with black friends or coworkers’’) (internal citations omitted); Johnson v. Univ. of Cincinnati, 215 F.3d 561, 574 (6th Cir. 2001) (a plaintiff who is not a member of a recognized protected class nevertheless alleges a cognizable discrimination claim under title VII and 42 U.S.C. 1981 if he alleges that he was discriminated against based on his association with a member of a recognized protected class); Tetro v. Elliot Popham Pontiac, Oldsmobile, Buick & GMC Trucks Inc., 173 F.3d 988, 994–95 (6th Cir. 1999) (holding that white plaintiff with biracial child stated a claim under title VII based on his own race ‘‘even though the root animus for the discrimination is a prejudice against the biracial child’’); Parr v. Woodmen of the World Life Ins., 791 F.2d 888, 892 (11th Cir. 1986) (‘‘Where a plaintiff claims discrimination based upon an interracial marriage or association, he alleges by definition that he has been discriminated against because of his race.’’). Cf. Loving v. Va., 388 U.S. 1 (1967). 322 Family Equality Council, LGBTQ Family Fact Sheet, https://www2.census.gov/cac/nac/meetings/ 2017-11/LGBTQ-families-factsheet.pdf, (as of 2017, between 2 and 3.7 million children in the US have LGBTQ+ parents); Family Equality Council, LGBTQ Family Building Survey (2019), https:// www.familyequality.org/wp-content/uploads/2019/ 02/LGBTQ-Family-Building-Study_Jan2019-1.pdf (77 percent of LGBTQ+ millennials either are already parents or are considering expanding their families in the years ahead); SAGE, Caregiving in the LGBT Community (2017), https:// www.lgbtagingcenter.org/resources/pdfs/SAGE% 20Caregiver%20Guide%20Final%20Interactive.pdf (approximately 3 million LGBTQ+ people are the primary caregiver for someone over the age of 50). 323 Tresa Baldas, Pediatrician Won’t Treat Baby With 2 Moms, USA Today (Feb. 18, 2015), https:// www.usatoday.com/story/news/nation/2015/02/18/ doctor-discrimination-baby/23642091/. E:\FR\FM\06MYR4.SGM 06MYR4 37642 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 likely also to be particularly important for people, especially children, who cannot access health care without the support of a caregiver. Such conduct by a covered entity may violate this provision and other provisions of this part, including §§ 92.101 (Discrimination prohibited), 92.206 (Equal program access on the basis of sex), 92.207 (Nondiscrimination in health insurance coverage and other health-related coverage), and 92.208 (Prohibition on sex discrimination related to marital, parental, or family status). Additionally, associational or caregiver discrimination also frequently arises in the context of disability discrimination, as addressed above in the preamble discussion of § 92.202 (Effective communication for individuals with disabilities). Another potential example of discrimination based on association relates to individuals with a substance use disorder (SUD) 324 and related stigma.325 The ADA, section 504, and section 1557 prohibit discrimination on the basis of disability, and individuals with an SUD or a history of having an SUD typically are protected under these authorities, unless they are engaged in the current illegal use of drugs.326 Section 92.209 makes clear that discrimination against individuals (including friends, nonfamilial caregivers, and family members) based on their association with individuals in recovery from SUD or with a history of drug use is prohibited under section 1557. Comment: One commenter accurately observed that, unlike the Proposed Rule, the 2016 Rule’s associational nondiscrimination provision referenced protections for both individuals and entities that associate with others. Emphasizing that an entity can also be discriminated against by other covered entities based on the original entity’s association with an individual due to the individual’s race, color, national origin, sex, disability or age, this commenter described a scenario where a health plan might discriminate against an entity that largely serves patients 324 Substance Use Disorder Demographics, American Addiction Centers, (Dec. 9, 2022), https:// sunrisehouse.com/addiction-demographics (more than 40 million Americans aged 12 or older suffered from a substance use disorder in 2020). 325 Janet Zwick et al., Stigma: How It Effects the Substance Use Disorder Patient, 15 Substance Abuse Treatment, Prevention, & Pol., (2020), https://link.springer.com/article/10.1186/s13011020-00288-0 (Stigma serves as a barrier to individuals with SUD seeking help, entering treatment, and accepting medications.). 326 See, e.g., U.S. Dep’t of Justice, The ADA and Opioid Use Disorder: Combatting Discrimination Against People in Treatment and Recovery (Apr. 5, 2022), https://www.ada.gov/resources/opioid-usedisorder/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 with LEP, LGBTQI+ populations, or an entity that provides Medications for Opioid Use Disorder (MOUD) to individuals with opioid use disorder. Response: OCR recognizes that there may be instances where covered entities may discriminate against other entities based on these other entities’ associations with populations they serve (including LGBTQI+ individuals, individuals with disabilities, etc.). For example, § 92.209 prohibits a covered entity from discriminating against another entity because that entity serves individuals protected under this rule, e.g., individuals with SUD,327 people with intellectual and developmental disabilities, people of a particular race or national origin, or people of a particular age. In this case, § 92.209 is violated based on the discriminatedagainst entity’s association with an individual or individuals based on their race, color, national origin, sex, age, or disability. OCR did not intend to suggest in the Proposed Rule that this was no longer considered a prohibited form of discrimination and therefore is including ‘‘entity’’ in the final rule text. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.209, with modification. We have revised the provision to clarify that covered entities are prohibited from discriminating against individuals and entities under this provision by adding ‘‘or entity’’ in the following locations: ‘‘. . . against an individual or entity . . .,’’ and ‘‘. . . with whom the individual or entity . . . .’’ Nondiscrimination in the Use of Patient Care Decision Support Tools (§ 92.210) Proposed § 92.210, entitled ‘‘Use of clinical algorithms in decision-making,’’ provided that a covered entity must not discriminate against any individual on the basis of race, color, national origin, sex, age, or disability through the use of clinical algorithms in its decisionmaking. We invited extensive public comment on this proposed provision, including on whether to limit the provision to clinical algorithms or to include additional forms of automated or augmented decision-making tools or models, such as artificial intelligence (AI) and machine learning, and whether the provision should include more 327 See MX Grp., Inc. v. City of Covington, 293 F.3d 326, 335 (6th Cir. 2002) (a public entity violated title II of the ADA when it discriminated against a drug and alcohol treatment center by denying it a zoning permit because the center provided services to individuals with disabilities). PO 00000 Frm 00122 Fmt 4701 Sfmt 4700 specificity, such as explaining actions covered entities must take to identify and mitigate potential discrimination from these tools. 87 FR 47884. The Proposed Rule preamble described clinical algorithms as ‘‘tools used to guide health care decision-making that could range in form from flowcharts and clinical guidelines to complex computer algorithms, decision support interventions, and models.’’ 87 FR 47880. The preamble also described clinical algorithms as tools used by ‘‘hospitals, providers, and payers (e.g., health insurance issuers) . . . to assist with health care decision-making for various purposes,’’ including ‘‘screening, risk prediction, diagnosis, prognosis, clinical decision-making, treatment planning, health care operations, and allocation of resources, all of which affect the care that individuals receive.’’ 87 FR 47880. The comments and our responses regarding § 92.210 are set forth below. Comment: Many commenters requested that OCR codify a definition for the term ‘‘clinical algorithm.’’ Some commenters requested a definition for ‘‘clinical algorithm’’ to include any form of automated decision systems and AI used in health programs or activities. Many commenters also recommended that § 92.210 apply to tools used in a covered entity’s health programs and activities in addition to those used in a clinical setting. These commenters suggested that § 92.210 should apply to a covered entity’s administrative health care operations because the use of these tools can impact individuals’ access to a covered entity’s health programs and activities and the quality of services provided. Arguing that the term ‘‘clinical algorithm’’ is insufficient, some commenters cited examples of tools that covered entities use in their health programs and activities, such as those used for budgeting and billing processes, utilization management, benefit design, program eligibility and enrollment, provider contracting, and pricing by providers and insurers which are susceptible to discriminatory bias. Commenters also identified tools used in skilled nursing facilities, tools used to allocate home and community-based services, and Medicaid eligibility systems. Response: In the Proposed Rule’s preamble, we indicated that ‘‘clinical algorithms’’ include tools beyond actual algorithms, 87 FR 47880, and we solicited comment about whether ‘‘clinical algorithms’’ should ‘‘include additional forms of automated or augmented decision-making tools or models such as artificial intelligence or E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations machine learning,’’ 87 FR 47884. The Proposed Rule described ‘‘clinical algorithms’’ as ‘‘tools used to guide health care decision-making that can range in form from flowcharts and clinical guidelines to complex computer algorithms, decision support interventions, and models,’’ which hospitals, providers and health insurance issuers use to ‘‘assist with decision-making for various purposes,’’ including ‘‘screening, risk prediction, diagnosis, prognosis, clinical decisionmaking, treatment planning, health care operations, and allocation of resources, all of which affect the care that individuals receive.’’ 87 FR 47880 (emphases added). Thus, the Proposed Rule described clinical algorithms broadly to include a variety of health care decision-making tools in a covered entity’s health programs and activities related to patient care. We further solicited comment about ‘‘what types of clinical algorithms are being used in covered health programs and activities; how such algorithms are being used by covered entities; [and] whether they are more prevalent in certain health settings . . . .’’ 87 FR 47884. As discussed in the preamble under § 92.4, we are adopting the more precise term ‘‘patient care decision support tool’’ to replace the term ‘‘clinical algorithm.’’ This new term more closely aligns with what we described as ‘‘clinical algorithms’’ in the preamble to the Proposed Rule, such as various tools used to guide health care decisionmaking that affect the care that patients receive. See 87 FR 47880. In § 92.4, we define ‘‘patient care decision support tool’’ to mean ‘‘any automated or nonautomated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decision-making in its health programs or activities.’’ The definition applies to tools that are used by a covered entity in its clinical decision-making that affect the patient care that individuals receive. Given covered entities’ widespread use of automated decision systems and AI, and the scale by which AI can influence covered entities’ clinical decision-making,328 we are confirming that the types of patient care decision support tools subject to § 92.210 include automated decision systems and AI used to support clinical decision-making. 328 Nat’l Acad. of Med., Artificial Intelligence in Health Care: The Hope, the Hype, the Promise, the Peril, pp. 2, 3 (2019), https://doi.org/10.17226/ 27111; Nat’l Inst. of Standards & Tech., Artificial Intelligence Risk Management Framework (AI RMF 1.0), NIST AI 100–1, pp. 1, 17, 40 (2023), https:// doi.org/10.6028/NIST.AI.100-1. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Covered entities may use patient care decision support tools in their health care decision-making in a variety of ways. Covered entities typically use patient care decision support tools at the individual patient level, such as a provider using clinical guidance from an algorithm to assess a patient’s risk of a severe cardiac event.329 Other patient care decision support tools pertain to health care administration decisions, typically used with regard to a group of patients (or a population) based on shared characteristics. For example, there is evidence that hospital system treatment protocol varies by geographic area due to variations produced by risk adjustment modeling.330 In addition to these examples, patient care decision support tools would also include tools used for prior authorization and medical necessity analysis,331 which directly impacts clinical decision-making and affects the care received by patients as directed by their providers. For example, a medical necessity review tool used by Medicare Advantage plans has been shown to deny enrollees’ medical claims for rehabilitative care without considering enrollees’ individual circumstances.332 One subset of patient care decision support tools to which § 92.210 applies includes ‘‘predictive decision support interventions’’ as defined in the Office 329 See, e.g., Darshali A. Vyas et al., Hidden in Plain Sight—Reconsidering the Use of Race Correction in Clinical Algorithms, 383 N. Engl. J. Med. 874, 876–78 (Aug. 27, 2020). 330 Elliott Fisher et al., Health Care Spending, Quality, and Outcomes—More Isn’t Always Better, The Dartmouth Inst. for Health Pol. & Clinical Practice (2009), https://www.ncbi.nlm.nih.gov/ books/n/darthhcspending/pdf/; Ziad Obermeyer et al., Dissecting Racial Bias in an Algorithm Used to Manage the Health of Populations, 366 Science 447 (2019), https://www.science.org/doi/10.1126/ science.aax2342. 331 See, e.g., Casey Ross & Bob Herman, UnitedHealth Pushed Employees to Follow an Algorithm to Cut Off Medicare Patients’ Rehab Care, STAT News (Nov. 14, 2023), https:// www.statnews.com/2023/11/14/unitedhealthalgorithm-medicare-advantage-investigation/; Patrick Rucker et al., How Cigna Saves Millions by Having Its Doctors Reject Claims Without Reading Them, ProPublica (March 25, 2023), https:// www.propublica.org/article/cigna-pxdx-medicalhealth-insurance-rejection-claims; Casey Ross & Bob Herman, Denied by AI: How Medicare Advantage Plans Use Algorithms to Cut Off Care for Seniors in Need, STAT News, (Mar. 13, 2023) https://www.statnews.com/2023/03/13/medicareadvantage-plans-denial-artificial-intelligence/; Shahed Al-Haque et al., AI Ushers in Next-Gen Prior Authorization in Healthcare, McKinsey & Co. (Apr. 19, 2022), https://www.mckinsey.com/ industries/healthcare/our-insights/ai-ushers-innext-gen-prior-authorization-in-healthcare#/. 332 See, e.g., Casey Ross & Bob Herman, Denied by AI: How Medicare Advantage Plans Use Algorithms to Cut Off Care for Seniors in Need, STAT News, https://www.statnews.com/2023/03/ 13/medicare-advantage-plans-denial-artificialintelligence/ (Mar. 13, 2023). PO 00000 Frm 00123 Fmt 4701 Sfmt 4700 37643 of the National Coordinator for Health Information Technology’s (ONC) recently published final rule for ‘‘Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing.’’ 333 In its rule, ONC defines the term ‘‘predictive decision support intervention’’ (Predictive DSI) to mean ‘‘technology that supports decision-making based on algorithms or models that derive relationships from training data and then produce an output that results in prediction, classification, recommendation, evaluation, or analysis.’’ 89 FR 1192 (codified at 45 CFR 170.102). As ONC discussed in the Proposed Rule, Predictive DSI are used to predict unknown values based on relationships learned in training data, and they pertain to automated tools used for clinical, financial, or administrative purposes. ‘‘Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing.’’ 88 FR 23746, 23785 (April 18, 2023). It is important to note that § 92.210 is not duplicative of ONC’s rule regarding Predictive DSIs because ONC’s rule applies to and includes requirements for health information technology (IT) developers, whereas § 92.210 applies to and includes requirements for section 1557 covered entity users of patient care decision support tools (including Predictive DSIs). A section 1557 covered entity may, of course, develop its own Predictive DSI, in which case that entity may be subject to ONC’s Predictive DSI requirements as well as section 1557’s nondiscrimination requirements under § 92.210. Refer to section V of ONC’s January 2024 Final Rule, 89 FR 1242– 54, for more detailed information regarding Predictive DSIs. OCR worked closely with ONC during the development of this final rule and ONC’s rule to advance a coordinated Departmental response in regulating 333 45 CFR 170.102; U.S. Dep’t of Health & Hum. Servs., Off. of the Nat’l Coordinator for Health Info. Tech., Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing, Final Rule, 89 FR 1192 (January 9, 2024). Regarding the term ‘‘intervention,’’ ONC notes that the term ‘‘intervention’’ in ‘‘prediction decision support intervention’’ was not intended to mean an intervention (medicine, medical procedure, or medical treatment) as the term is used in the practice of medicine, but rather, an intervention occurring within a workstream, including but not limited to alerts, order sets, flowsheets, dashboards, patient lists, documentation forms, relevant data presentations, protocol or pathway support, reference information or guidance, and reminder messages. Their use of the term intervention was consistent with how the Program used the term in § 170.315(a)(9). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37644 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations tools used to support health care decision-making. Section 92.210’s definition for ‘‘patient care decision support tool’’ also includes non-automated and evidencebased tools that rely on rules, assumptions, constraints, or thresholds, as these also have the potential to result in discrimination. This includes ‘‘evidence-based decision support interventions’’ identified in ONC regulations at 45 CFR 170.315(b)(11)(iii). An example of a non-automated patient care decision support tool is a Crisis Standards of Care 334 flowchart for triage guidance. Such a flowchart may result in discrimination if, for example, it screens out individuals with disabilities, prohibiting them from equally accessing a health care service, program, or activity that a covered entity offers by assessing an individual’s potential response to life-saving care without making an individualized assessment of the individual’s health and without providing modifications for how an individual’s disability or age could affect the assessment factors used in the algorithm or the time needed for the individual to respond to treatment. Another example is the race-adjusted estimated glomerular filtration rate (eGFR) equation that relies not only on training data, but also discriminatory assumptions and thresholds such as by applying a race-adjusted coefficient to the eGFR equation to reflect that Black people have been associated with higher levels of blood creatinine as compared with that of non-Black people, which results in a higher significance threshold for Black patients, thereby requiring more advanced kidney failure for Black patients than non-Black patients before they can receive the same level of care. Other examples of patient care decision support tools include, but are not limited to: flowcharts; formulas; equations; calculators; algorithms; utilization management applications; software as medical devices (SaMDs); software in medical devices (SiMDs); screening, risk assessment, and eligibility tools; and diagnostic and treatment guidance tools. Comment: Some commenters urged OCR to narrow the definition for ‘‘clinical algorithm’’ and to clarify that the scope of § 92.210 does not extend beyond flowcharts and clinical algorithms to any forms of automated decision systems or AI. These commenters contended that a narrow definition is necessary to limit covered 334 Crisis Standards of Care inform decisionmaking designed to accomplish the best outcome for a group of patients rather than focusing on an individual patient. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 entities’ liability and burden, disruption to covered entities’ decision-making, and patients’ exposure to greater health risks. Response: Section 92.210 does not apply to tools used to support decisionmaking unrelated to clinical decisionmaking affecting patient care or that are outside of a covered entity’s health programs or activities. For example, § 92.210 does not apply to the following activities when such activities are unrelated to clinical decision-making affecting patient care: automated or nonautomated tools that covered entities use for administrative and billingrelated activities; automated medical coding; fraud, waste and abuse; patient scheduling; facilities management; inventory and materials management; supply chain management; financial market investment management; or employment and staffing-related activities. The purpose of § 92.210 is to prohibit discrimination that occurs through covered entities’ use of patient care decision support tools in their health programs or activities. The rule does not seek to disrupt covered entities’ clinical decision-making, expose patients to greater health risks, or to prevent the use of these tools entirely. We encourage covered entities to continue procuring, developing, and using patient care decision support tools that will improve patient care and access to quality care. Section 92.210 will help covered entities use these tools in a nondiscriminatory manner. Under § 92.210, evidence-based researchers, whose findings inform many inputs to patient care decision support tools, will be incentivized to recalibrate data, assumptions, and methods used in earlier studies. Comment: Many commenters expressed support for proposed § 92.210 and discussed the extent of discrimination in health care resulting from the use of algorithms. Commenters were particularly concerned about the prevalence of ethnic and racial bias in clinical algorithms that results in fewer health care services provided to Black, Hispanic/Latino, Asian, and American Indian/Alaska Native patients. Others discussed Crisis Standards of Care, stating they are too often biased against people with disabilities, people of color (who disproportionately have at least one disability), and older individuals because these tools assess an individual’s potential response to lifesaving care without making an individualized assessment of the individual’s health and without providing modifications for how an individual’s disability or age could PO 00000 Frm 00124 Fmt 4701 Sfmt 4700 affect the assessment factors used in the algorithm or the time needed for the individual to respond to treatment. Response: OCR appreciates commenters’ feedback regarding proposed § 92.210. We share commenters’ concerns about the potential for discrimination caused by the use of algorithms in health care, which are receiving considerable attention from the Department and Administration,335 other executive agencies, Congress, stakeholders, professional associations, medical journals, and the media. As OCR implements section 1557 and other civil rights laws, it will continue to consider additional actions to support covered entities in implementation and compliance consistent with Federal law, including guidance or provision of technical assistance. We particularly note that, since publication of proposed § 92.210, the Administration has issued: (1) a Blueprint for an AI Bill of Rights, which includes a principle for protecting the public from algorithmic discrimination; 336 (2) E.O. 14091, Further Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, which includes a section requiring agencies to consider opportunities to ‘‘prevent and remedy discrimination, including by protecting the public from algorithmic discrimination;’’ 337 and (3) E.O. 14110, Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence, which sets forth 335 See, e.g., U.S. Dep’t of Health & Hum. Servs., HHS Finalizes Rule to Advance Health IT Interoperability and Algorithm Transparency (2023), https://www.hhs.gov/about/news/2023/12/ 13/hhs-finalizes-rule-to-advance-health-itinteroperability-and-algorithm-transparency.html; U.S. Dep’t of Health & Hum. Servs., Guiding Principles Help Healthcare Community Address Potential Bias Resulting from Algorithms (2023), https://www.hhs.gov/about/news/2023/12/15/ guiding-principles-help-healthcare-communityaddress-potential-bias-resulting-fromalgorithms.html; U.S. Dep’t of Health & Hum. Servs., Delivering on the Promise of AI to Improve Health Outcomes (2023), https:// www.whitehouse.gov/briefing-room/blog/2023/12/ 14/delivering-on-the-promise-of-ai-to-improvehealth-outcomes/; U.S. Dep’t of Health & Hum. Servs., FACT SHEET: Biden-Harris Administration Announces Voluntary Commitments from Leading Healthcare Companies to Harness the Potential and Manage the Risks Posed by AI (2023), https:// www.hhs.gov/about/news/2023/12/14/fact-sheetbiden-harris-administration-announces-voluntarycommitments-leading-healthcare-companiesharness-potential-manage-risks-posed-ai.html. 336 The White House, Blueprint for an AI Bill of Rights (Oct. 4, 2022), https://www.whitehouse.gov/ ostp/ai-bill-of-rights/. 337 E.O. 14091, sec. 8(f), 88 FR 10825, 10831 (Feb. 22, 2023), https://www.federalregister.gov/ documents/2023/02/22/2023-03779/furtheradvancing-racial-equity-and-support-forunderserved-communities-through-the-federal. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations numerous executive actions designed to ensure the equitable, safe, and secure use of AI.338 E.O. 14110 addresses civil rights violations and discrimination related to AI and seeks to protect individuals’ civil rights by preventing discrimination, including algorithmic discrimination, through the use of automated systems and AI.339 Executive Order 14110 directs the Department to take actions, ‘‘possibly including regulatory action,’’ to ‘‘ensure the safe, responsible deployment and use of AI in the healthcare, publichealth, and human-services sectors.’’ 340 It also directs the Department to ‘‘consider appropriate actions to advance the prompt understanding of, and compliance with, Federal nondiscrimination laws by health and human services providers that receive Federal financial assistance, as well as how those laws relate to AI.’’ 341 We also acknowledge the recent surge in academic research highlighting potential harms caused by use of patient care decision support tools that may create or contribute to discrimination prohibited by section 1557, as discussed in the Proposed Rule at 87 FR 47880– 82. We appreciate the comments addressing the potential bias in Crisis Standards of Care, which, as discussed at length in the Proposed Rule, 87 FR 47881–82, were the focus of OCR’s enforcement efforts during the COVID– 19 Public Health Emergency and resulted in six States revising their Crisis Standards of Care to prevent discriminatory prioritization of hospital resources.342 Comment: Some commenters opposed proposed § 92.210, in part, because existing laws and regulations already prohibit discrimination in algorithmic tools. Other commenters opposed to finalizing § 92.210 urged OCR to use the feedback we received during the public comment period to inform engagement with stakeholders, including the Food and Drug Administration (FDA), device manufacturers, algorithm developers, clinicians, patients, and others, through which OCR could develop a regulatory 338 E.O. ddrumheller on DSK120RN23PROD with RULES4 339 E.O. 14110, 88 FR 75191 (Nov. 1, 2023). 14110, sec. 7, 88 FR 75191, 75211 (Nov. 1, 2023). 340 E.O. 14110, sec. 8(b)(i), 88 FR 75191, 75214 (Nov. 1, 2023). 341 E.O. 14110, sec. 8(b)(iii), 88 FR 75191, 75214 (Nov. 1, 2023). 342 For more information on OCR’s work related to discrimination in Crisis Standards of Care, see Civil Rights and COVID–19, Non-Discrimination in Crisis Standards of Care, U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., https:// www.hhs.gov/civil-rights/for-providers/civil-rightscovid19/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 framework involving risk-based approaches. Response: While several Federal departments and agencies are taking action to regulate AI and other decisionmaking tools,343 OCR, consistent with its underlying authority, is in a unique position to provide additional specificity regarding the application of long-standing nondiscrimination requirements to the use of such tools to ensure that discrimination does not result from covered entities’ use of patient care decision support tools in their health programs or activities. The Department has authority to enforce section 1557, which prohibits covered 343 See, e.g., Proposed Rule at 87 FR 47882–84, n.569, 571, 578; U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of AllInclusive Care for the Elderly, Final Rule, 88 FR 22120, 22195 (Apr. 12, 2023), https:// www.govinfo.gov/content/pkg/FR-2023-04-12/pdf/ 2023-07115.pdf (‘‘MA organizations must ensure that they are making medical necessity determinations based on the circumstances of the specific individual, as outlined at § 422.101(c), as opposed to using an algorithm or software that doesn’t account for an individual’s circumstances.’’); U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Organ Acquisition; Rural Emergency Hospitals: Payment Policies, Conditions of Participation, Provider Enrollment, Physician Self-Referral; New Service Category for Hospital Outpatient Department Prior Authorization Process; Overall Hospital Quality Star Rating; COVID–19, Final Rule, 87 FR 71748, 72036 (Nov. 23, 2022), https:// www.federalregister.gov/documents/2022/11/23/ 2022-23918/medicare-program-hospital-outpatientprospective-payment-and-ambulatory-surgicalcenter-payment (responding to comment solicitation on how to prevent and mitigate bias in algorithms and predictive modeling); U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., Artificial Intelligence/Machine Learning (AI/ML)Based Software as a Medical Device (SaMD) Action Plan (2021), https://www.fda.gov/medical-devices/ software-medical-device-samd/artificialintelligence-and-machine-learning-softwaremedical-device; U.S. Dep’t of Health & Hum. Servs., Off. of the Nat’l Coordinator for Health Info. Tech., Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing, Final Rule, 89 FR 1192 (January 9, 2024); Consumer Fin. Protection Bureau, U.S. Dep’t of Justice, U.S. Equal Employment Opportunity Comm’n, & Fed. Trade Comm’n, Joint Statement on Enforcement Efforts Against Discrimination and Bias in Automated Systems (Apr. 2023), https:// files.consumerfinance.gov/f/documents/cfpb_jointstatement-enforcement-against-discrimination-biasautomated-systems_2023-04.pdf; Fed. Deposit Ins. Corp., Request for Information and Comment on Financial Institutions’ Use of Artificial Intelligence, Including Machine Learning, 86 FR 16837–38 (May 24, 2021), https://www.govinfo.gov/content/pkg/FR2021-05-24/pdf/2021-10861.pdf; Nat’l Inst. of Standards & Tech., Artificial Intelligence Risk Management Framework (AI RMF 1.0), NIST AI 100–1 (2023), https://doi.org/10.6028/NIST.AI.1001. PO 00000 Frm 00125 Fmt 4701 Sfmt 4700 37645 entities from discriminating in their health programs and activities, including through the use of AI and other tools. Section 92.210 provides additional clarity to covered entities regarding their obligations. We are finalizing § 92.210 with a delayed applicability date of no later than 300 days after the final rule’s effective date to give covered entities a reasonable period of time to come into compliance with § 92.210(b) and (c). We received significant input on this issue from stakeholders during the public comment period, and the breadth of stakeholders’ input and available research has informed the revisions in the final version of § 92.210. As OCR implements section 1557 and other civil rights laws, it will continue to consider additional actions to support covered entities in implementation and compliance consistent with Federal law, including guidance or engaging in future rulemaking. As AI, clinical algorithms, and predictive analytics are more widely used, OCR will continue to engage with the FDA, ONC, and other Federal partners to ensure consistency and a coordinated governmental effort to regulate such tools in health care. We will also continue to solicit stakeholders’ input and to assist covered entities with compliance. Comment: Some commenters expressed concern that proposed § 92.210 would not apply to health carerelated AI products that are autonomous or that augment a covered entity’s decision-making in its health programs and activities. Response: This final rule clarifies that § 92.210 applies to all patient care decision support tools used in a covered entity’s health programs or activities to support clinical decision-making, including patient care decision support tools that are autonomous and those that assist or augment a covered entity’s clinical decision-making. Comment: Some commenters recommended that § 92.210 exclude tools designed to improve health equity because these tools serve to protect members of historically marginalized communities. Relatedly, one commenter asked how proposed § 92.210 would affect algorithms that are currently in use and specifically designed to identify certain groups of patients susceptible to a particular condition or that may benefit from a particular therapy. Response: Section 92.210 does not prohibit covered entities from using patient care decision support tools that identify, evaluate, and address health disparities so long as their use does not constitute prohibited discrimination on E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37646 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations the basis of race, color, national origin, sex, age, or disability. Comment: Many commenters requested that OCR revise § 92.210 to include transparency requirements for covered entities regarding their use of clinical algorithms in their health programs and activities, including a requirement that covered entities notify individuals about the training data, assumptions, constraints, thresholds, and other inputs used to design each clinical algorithm in use. Commenters noted that otherwise, individuals would not know whether there has been a violation of § 92.210. Response: A covered entity may routinely change the patient care decision support tools it uses. While there may be benefits to providing such information to patients, we decline to revise § 92.210 to require covered entities to notify patients about the patient care decision support tools used in their health programs and activities given the possible frequent changes and the costs associated with notifying patients. We similarly decline to revise § 92.210 to require covered entities to notify patients about the training data and other inputs used to design and develop the patient care decision support tools used by a covered entity because, in addition to the costs discussed above, currently, patient care decision support tool developers may not ordinarily share this information with covered entities. We note, however, that ONC’s final rule requires decision support interventions, supplied by a developer of certified health IT as part of its Health IT Module certified to 45 CFR 170.315(b)(11) criterion, to support making this information (source attributes) available to users of the Health IT Module. In addition, developers of certified health IT certified to 45 CFR 170.315(b)(11)(iii)(B) are required to make summary information of intervention risk management practices publicly available for Predictive DSIs the developer supplies as part of its Health IT Module provided through 45 CFR 170.523(f)(1)(xxi). 89 FR 1192 (January 9, 2024). Covered entities using decision support interventions supplied by a developer of certified health IT should have this type of information available to them. In addition, to the extent that covered entities subject to HIPAA document their use of a patient care decision support tool in an individual’s medical record, individuals may obtain that information when they exercise their HIPAA right of access to their protected health information contained in their VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 respective designated record sets. See 45 CFR 164.524. Other Departmental agencies may also issue transparencyrelated guidance and requirements for AI developers. OCR seeks to partner with other agencies and covered entities to address best practices and may release guidance in the future. While we decline to impose transparency requirements under § 92.210 for the reasons stated above, we note that it would be a best practice for covered entities to disclose information to patients about the patient care decision support tools used in their health programs and activities.344 We further note, however, that such voluntary disclosure does not ensure compliance with § 92.210. Comment: Many commenters recommended that OCR revise § 92.210 to clarify the steps that a covered entity must take to comply with § 92.210 and to ensure nondiscriminatory use of clinical algorithms. Commenters explained that when providers use a patient care support tool, they often rely on a developer’s intended uses for the tool. Commenters discussed that covered entities do not design or develop many of the clinical algorithms that they use and are therefore unlikely to be aware of how the tool operates. They also stated that it is infeasible to require a covered entity to audit all algorithms in its health programs or activities and that proposed § 92.210 would force covered entities to police their own supply chains for clinical algorithms, which they state is also impracticable. Commenters expressed concern that covered entities may incur liability when they are unaware that an algorithmic output may result in discrimination and opined that covered entities should not be liable in such cases. Another commenter specified that physician liability should be limited to when a reasonable physician knows or should have known that the algorithm in question utilizes inputs and logic that are likely to result in discrimination. Further, commenters asserted that the additional steps that covered entities would need to take to comply with proposed § 92.210 are very likely to contribute to providers’ already strained workload and further contribute to burnout. Response: We appreciate commenters’ concerns and have revised § 92.210 to provide additional clarity. We have added additional clarification on covered entities’ obligations under 344 See, e.g., Am. Med. Ass’n, American Medical Association Principles for Augmented Intelligence Development, Deployment, and Use, pp. 2–4 (2023), https://www.ama-assn.org/system/files/ama-aiprinciples.pdf. PO 00000 Frm 00126 Fmt 4701 Sfmt 4700 § 92.210. Section 92.210 sets forth the general prohibition on discrimination on the basis of race, color, national origin, sex, age, or disability by a covered entity in its health programs or activities through the use of patient care decision support tools. Section 92.210(b) requires a covered entity to make reasonable efforts to identify patient care decision support tools used in its health programs and activities that employ input variables or factors that measure race, color, national origin, sex, age, or disability. Section 92.210(c) requires that for each patient care decision support tool identified in paragraph (b), a covered entity must make reasonable efforts to mitigate the risk of discrimination resulting from the tool’s use in its health programs or activities. We appreciate comments regarding how a covered entity may learn that a patient care decision support tool used in its health programs or activities creates a risk of discrimination on a protected basis. In the Proposed Rule, we noted that use of clinical algorithms may result in discriminatory outcomes when variables are used as a proxy for a protected basis, and that discrimination may result from correlations between a variable and a protected basis. 87 FR 47881. As a threshold matter, we note that section 1557 prohibits proxy discrimination as a general civil rights principle that applies to the entire final rule.345 However, given the many possible indirect measures of race, color, national origin, sex, age, and disability, covered entities are not required to identify all patient care decision support tools with input variables or factors that indirectly measure these protected bases. However, covered entities should exercise caution when using patient care decision support tools that are known to use indirect measures for race, color, national origin, sex, age, or disability, which could result in prohibited discrimination. We understand that covered entities in some circumstances may be largely unaware of the datasets developers use to train the patient care decision support tools that covered entities use. Section 92.210 does not require covered entities to obtain datasets or other attribute information from developers when purchasing or using patient care decision support tools. However, if a covered entity does not know whether a developer’s patient care decision support tool uses variables or factors that measure race, color, national origin, 345 See discussion of proxy discrimination at § 92.207. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations sex, age, or disability but has reason to believe such variables or factors are being used, or the covered entity otherwise knows or should know that the tool could result in discrimination, the covered entity should consult publicly available sources or request this information from the developer. Further, ONC’s recently published final rule discussed above revises existing certification criteria for developers of certified health IT by requiring developers with Health IT Modules certified to § 170.315(b)(11) to disclose information about a decision support intervention’s source attributes relevant to health equity with the decision support intervention users. 89 FR 1192. This disclosure requirement will work in tandem with § 92.210 by enabling a covered entity that uses Health IT Modules certified to § 170.315(b)(11) to learn from a developer whether a specific decision support intervention relies on attributes that measure race, color, national origin, sex, age, or disability. We are aware that covered entities use patient care decision support tools based on their respective needs and in accordance with developers’ intended uses. But covered entities must exercise due diligence when acquiring and using such tools to ensure compliance with § 92.210. Covered entities may learn that use of patient care decision support tools risk resulting in discrimination when OCR included that information in the Proposed Rule. In the Proposed Rule, in addition to the use of the race-adjusted eGFR equation discussed above, we identified uses of other categories of tools that may result in discrimination based on race, including tools used in ‘‘cardiology (to assess the risk of heart failure), cardiac surgery (to assess the risk of complications and death), obstetrics (to determine risks associated with vaginal birth after cesarean), urology (to assess the risk of kidney stones and urinary tract infections), oncology (to predict rectal cancer survival and breast cancer risk), endocrinology (to assess osteoporosis and fracture risks), and pulmonology (to measure lung function).’’ 87 FR 47881. The Proposed Rule also identified that use of Crisis Standards of Care to allocate health care resources may also discriminate on the basis of disability and/or age. 87 FR 47880–82. OCR aims to continue providing additional guidance to the public and covered entities as such information on potential discrimination in the use of such tools becomes available. The Department itself regularly publishes information and advisories to VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 the public. For example, the Agency for Healthcare Research and Quality (AHRQ) recently issued a report on the ‘‘Impact of Healthcare Algorithms on Racial and Ethnic Disparities in Health and Healthcare.’’ 346 Additionally, addressing published medical journals’ research studies and the subsequent media attention about racial bias resulting from the use of pulse oximeters, the FDA published a safety communication to announce that the FDA was reassessing the content of its pulse oximetry guidance document and would share additional updates with the public.347 Published articles of research studies in peer-reviewed medical journals are also a reliable source of information about evidence-based adverse outcomes based on patient care decision support tools that may result in discrimination. Such articles are increasing in prevalence given the growing use of AI and other patient care decision support tools in health care decision-making.348 For example, peer-reviewed medical journals have recently published several articles related to racial discrepancies resulting from the use of pulse 346 Kelley Tipton et al., U.S. Dep’t of Health & Hum. Servs., Agency for Healthcare Rsch. & Quality, Impact of Healthcare Algorithms on Racial and Ethnic Disparities in Health and Healthcare, Comparative Effectiveness Review No. 268, AHRQ Publication No. 24–EHC004 (2023), https:// effectivehealthcare.ahrq.gov/sites/default/files/ related_files/cer-268-racial-disparities-healthhealthcare.pdf. 347 U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., Pulse Oximeter Accuracy and Limitations: FDA Safety Communication, https:// public4.pagefreezer.com/content/FDA/20-022024T15:13/https://www.fda.gov/medical-devices/ safety-communications/pulse-oximeter-accuracyand-limitations-fda-safety-communication. 348 See, e.g., Armando D. Bedoya et al., A Framework for the Oversight and Local Deployment of Safe and High-Quality Prediction Models, 29 J. of Am. Med. Informatics Ass’n. 9, 1631–1636 (2022), https://doi.org/10.1093/jamia/ocac078 (describing a governance framework that combines current regulatory best practices and lifecycle management of predictive models being used for clinical care and maintaining a governance portfolio where models are actively added); Shyam Visweswaran et al., Clinical Algorithms with Race: An Online Database, medRxiv [Preprint], doi: 10.1101/2023.07.04.23292231 (2023), https:// pubmed.ncbi.nlm.nih.gov/37461462/ #:∼:text=These%20clinical %20algorithms%20based%20on,the %20inappropriate%20use%20of%20race (conducting a comprehensive search of online resources, the scientific literature, and the FDA Drug Label Information to identify clinical algorithms that incorporate race or ethnicity as an input variable or predictor in determining diagnoses, prognoses, treatment plans, or risk assessments; finding 39 race-based risk calculators, 6 laboratory test results with race-based reference ranges, 1 race-based therapy recommendation, and 15 medications with race-based recommendations; and creating a current and open-access database to track race-based clinical algorithms). PO 00000 Frm 00127 Fmt 4701 Sfmt 4700 37647 oximeters.349 One such study found that pulse oximeters more commonly overestimated arterial oxygen saturation levels in patients from minority racial and ethnic groups and led to delayed recognition of need for COVID–19 therapy among Black patients compared with white patients.350 Covered entities also may gain knowledge that use of a patient care decision support tool creates a risk of discrimination based on a prohibited basis through media outlets that may report on reliable studies.351 Health care professional and hospital associations are also often dependable sources of information that notify health care providers about developments in the practice of various specialties and in the administration of medical care, which can include potential discrimination that may result from the use of certain patient care decision support tools.352 Health insurancerelated associations also provide information to their members and the public.353 Relevant information is also 349 See, e.g., Ashraf Fawzy et al., Racial and Ethnic Discrepancy in Pulse Oximetry and Delayed Identification of Treatment Eligibility Among Patients with COVID–19, 182 JAMA Internal Med. 730 (2022), https://jamanetwork.com/journals/ jamainternalmedicine/fullarticle/2792653; Valeria S.Valbuena et al., Racial and Ethnic Bias in Pulse Oximetry and Clinical Outcomes, 182 JAMA Internal Med. 699 (2022), https://jamanetwork.com/ journals/jamainternalmedicine/fullarticle/2792654; Michael W. Sjoding et al., Racial Bias in Pulse Oximetry Measurement, 383 New Eng. J. Med. 2477 (2020) https://www.nejm.org/doi/full/10.1056/ nejmc2029240. 350 Ashraf Fawzy et al., Racial and Ethnic Discrepancy in Pulse Oximetry and Delayed Identification of Treatment Eligibility Among Patients with COVID–19, 182 JAMA Internal Med. 730 (2022), https://jamanetwork.com/journals/ jamainternalmedicine/fullarticle/2792653. 351 Following medical journals’ publication of research articles related to racial bias through the use of pulse oximeters, several media outlets amplified those findings further to the public. See, e.g., Anil Onza et al., COVID–19 Made Pulse Oximeters Ubiquitous. Engineers are Fixing Their Racial Bias, (Feb. 13, 2023), https://www.npr.org/ 2023/02/10/1156166554/covid-19-pulse-oximetersracial-bias; Pulse Oximeters Should Not Be Used to Diagnose COVID–19, U.S. FDA Says, Reuters (Feb. 19, 2021), https://www.reuters.com/article/ushealth-coronavirus-pulse-oximeter/pulse-oximetersshould-not-be-used-to-diagnose-covid-19-u-s-fdasays-idUSKBN2AJ2G7. 352 See, e.g., Augmented Intelligence in Medicine, Am. Med. Ass’n, https://www.ama-assn.org/ practice-management/digital/augmentedintelligence-medicine (updated Mar. 1, 2024); Clinical Applications of Artificial Intelligence (webinar), Am. Coll. of Physicians, https:// www.acponline.org/meetings-courses/webinars/ clinical-applications-of-artificial-intelligence (June 8, 2023). See generally, Medical & Professional Associations, Meditech, https://www.meditec.com/ resourcestools/professional-associations-list. 353 See, e.g., Artificial Intelligence, Nat’l Ass’n of Ins. Comm’rs, https://content.naic.org/cipr-topics/ artificial-intelligence; Creating Better Health Outcomes with Digital Tools and Artificial E:\FR\FM\06MYR4.SGM Continued 06MYR4 37648 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 provided through various nonprofit organizations in the field of AI. ONC’s rule also provides an opportunity for covered entities to learn about the data used in decision support interventions. Developers of decision support interventions that develop certified health IT as part of its Health IT Module are required to support making specific information disclosures under ONC’s rule regarding discriminatory bias in their tools, including disclosure of source attributes, and risk management and governance practices.354 OCR will assess each allegation that a covered entity is violating § 92.210 on a case-by-case basis. For example, when OCR investigated complaints related to State Crisis Standards of Care guidelines during the COVID–19 pandemic, the investigations involved a fact-specific analysis of each of the guidelines in question. They also included extensive technical assistance with States to revise their Crisis Standards of Care guidelines to remove the alleged discriminatory.355 In our analysis of whether a covered entity is in compliance with § 92.210(b)’s ‘‘reasonable efforts to identify’’ requirement, OCR may consider, among other factors: (1) the covered entity’s size and resources (e.g., a large hospital with an IT department and a health equity officer would likely be expected to make greater efforts to identify tools than a smaller provider without such resources); (2) whether the covered entity used the tool in the manner or under the conditions intended by the developer and approved by regulators, if applicable, or whether the covered entity has adapted or customized the tool; (3) whether the covered entity received product information from the developer of the tool regarding the potential for discrimination or identified that the Intelligence (webinar), Am.’s Health Ins. Plans, https://www.ahip.org/webinars/creating-betterhealth-outcomes-with-digital-tools-and-artificialintelligence (Dec. 8, 2023). 354 U.S. Dep’t of Health & Hum. Servs., Off. of the Nat’l Coordinator for Health Info. Tech., Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing, Final Rule, 89 FR 1192 (January 9, 2024). 355 See, e.g., U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Civil Rights and COVID–19, NonDiscrimination in Crisis Standards of Care, https:// www.hhs.gov/civil-rights/for-providers/civil-rightscovid19/; Press release, U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., OCR Resolves Complaint with Utah After It Revised Crisis Standards of Care to Protect Against Age and Disability Discrimination (Aug. 20, 2020), https:// public3.pagefreezer.com/content/HHS.gov/31-122020T08:51/https://www.hhs.gov/about/news/2020/ 08/20/ocr-resolves-complaint-with-utah-afterrevised-crisis-standards-of-care-to-protect-againstage-disability-discrimination.html. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 tool’s input variables include race, color, national origin, sex, age, or disability; and (4) whether the covered entity has a methodology or process in place for evaluating the patient care decision support tools it adopts or uses, which may include seeking information from the developer, reviewing relevant medical journals and literature, obtaining information from membership in relevant medical associations, or analyzing comments or complaints received about patient care decision support tools. In summary, OCR recognizes the challenges in identifying the discriminatory potential of every use of each patient care decision support tool, and therefore § 92.210(b) requires covered entities to make reasonable efforts to identify tools that employ input variables based on a protected basis. Comment: Many commenters referred to potential devastating consequences from the use of specific clinical algorithms 356 and recommended that § 92.210 be revised to include a requirement for covered entities to mitigate the risk of discrimination that results from the use of clinical algorithms. Some commenters suggested that OCR require specific mitigation efforts, such as requiring covered entities to: develop and implement policies specific to covered entities’ use of clinical algorithms; require staff training; use clinical algorithms in accordance with FDA clearance and developer’s intended uses; use peerreviewed research to inform adjustments to clinical algorithms; notify patients of suspect clinical algorithms; request an assessment of discriminatory inputs from developers; neutralize any discriminatory inputs by using the predominant cohort in the tool’s training data; and submit annual reports to OCR regarding their use of clinical algorithms and mitigation efforts. Response: OCR agrees with commenters’ concerns about the potential for harm resulting from discriminatory algorithms and the need to mitigate the risks of discrimination when possible. However, we acknowledge that it is not always possible to completely eliminate the risk of discriminatory bias in patient care 356 Examples included race-adjusted correction factors used in spirometry, nephrology, and cardiology; State Medicaid eligibility systems that reduce benefits impacting historically marginalized individuals disproportionately to the overall population; health care utilization algorithms that use prior health care spending data to predict future health care needs that results in under-representing Black patients as compared to white patients; and other examples discussed throughout this preamble. PO 00000 Frm 00128 Fmt 4701 Sfmt 4700 decision support tools,357 and these tools also serve important health care functions. Section 92.210(c) requires covered entities to make reasonable efforts to mitigate the risk of discrimination resulting from the covered entity’s use of a patient care decision support tool identified in § 92.210(b). This standard allows a covered entity to adopt more robust safeguards to prevent discrimination, should it choose to do so. For example, in order to comply with § 92.210(c)’s mitigation requirement, a covered entity that uses the raceadjusted eGFR equation could discontinue using that equation and instead use the revised eGFR equation that does not adjust for race.358 The covered entity may also implement measures to ensure that staff members follow proper protocols when using the race-adjusted eGFR equation.359 OCR will evaluate mitigation measures covered entities take on a case-by-case basis to determine compliance with § 92.210(c). A covered entity’s obligation to mitigate risk of discrimination under § 92.210(c) is consistent with the National Institutes of Standards and Technology’s (NIST) Artificial Intelligence Risk Management Framework, which explains that AI bias mitigation helps minimize potential negative impacts of AI systems while providing opportunities to maximize positive impacts, without articulating express mitigation measures.360 The same is true for patient care decision support tools that a covered entity uses 357 See, e.g., Nat’l Inst. of Standards & Tech., Artificial Intelligence Risk Management Framework (AI RMF 1.0), NIST AI 100–1, (2023), https:// doi.org/10.6028/NIST.AI.100-1. 358 See, e.g., Cynthia Delgado et al., Special Report: A Unifying Approach for GFR Estimation: Recommendations of the NKF–ASN Task Force on Reassessing the Inclusion of Race in Diagnosing Kidney Disease, 79 a.m. J. of Kidney Diseases, 268– 288 (Sept. 23, 2021), https://www.ajkd.org/article/ S0272-63862100828-3/fulltext. 359 See, e.g., Press Release, U.S. Dep’t of Health & Hum. Servs., Health Servs. & Rsch. Admin., Organ Procurement & Transplantation Network, OPTN Board Approves Waiting Time Adjustment for Kidney Transplant Candidates Affected by RaceBased Calculation (Jan. 5, 2023), https:// optn.transplant.hrsa.gov/news/optn-boardapproves-waiting-time-adjustment-for-kidneytransplant-candidates-affected-by-race-basedcalculation/. 360 Nat’l Inst. of Standards & Tech., Artificial Intelligence Risk Management Framework (AI RMF 1.0), NIST AI 100–1, p. 4 (2023), https://doi.org/ 10.6028/NIST.AI.100-1, (The NIST AI Framework provides: ‘‘Where tradeoffs among the trustworthy characteristics arise, measurement provides a traceable basis to inform management decisions. Options may include recalibration, impact mitigation, or removal of the system from design, development, production, or use, as well as a range of compensating, detective, deterrent, directive, and recovery controls.’’). E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 in its health programs and activities for clinical decision-making. While we appreciate the breadth of mitigation techniques suggested by commenters—and agree that many of those efforts would be best practices to prevent algorithmic discrimination—we decline to require covered entities to take any specific mitigation efforts under § 92.210(c). We have determined that a reasonable efforts mitigation requirement strikes the right balance between the need for covered entities to mitigate the risk of discrimination resulting from their use of patient care decision support tools and the burden placed on covered entities. In the Proposed Rule, 87 FR 47883, we noted that covered entities may choose to mitigate discrimination by establishing written policies and procedures governing how clinical algorithms will be used in decision-making, including adopting governance measures; monitoring any potential impacts and developing ways to address complaints; and training staff on the proper use of such systems in decision-making. We encourage covered entities to take these and other additional mitigating efforts to comply with § 92.210.361 We further note that this rule does not excuse a covered entity from complying with any other applicable Federal or State law that may apply, including but not limited to requirements for FDA approval where appropriate, such as the Food Drug and Cosmetic Act 362 and the Medical Device Amendments.363 In addition, once a covered entity identifies a particular use of patient care decision support tool under § 92.210(b), a covered entity’s mitigation efforts under § 92.210(c) may vary based on the input variable or factor, as well as the purpose of the tool in question. OCR acknowledges that some input variables may generate greater scrutiny, such as race, which is highly suspect,364 as compared to other variables, such as age, which is more likely to have a clinically and evidence-based purpose. Some bases protected by section 1557, 361 See, e.g., Marshall H. Chin et al., Guiding Principles to Address the Impact of Algorithm Bias on Racial and Ethnic Disparities in Health and Health Care, 6 JAMA Network Open 12 (2023), https://jamanetwork.com/journals/jamanetwork open/fullarticle/2812958; Coalition for Health AI, Blueprint for Trustworthy AI Implementation Guidance and Assurance for Healthcare (2023), https://www.coalitionforhealthai.org/papers/ blueprint-for-trustworthy-ai_V1.0.pdf. 362 21 U.S.C. 301 et seq. 363 Pub. L. 94–925. 364 See, e.g., Michelle Tong & Samantha Artiga, Use of Race in Clinical Diagnosis and Decision Making: Overview and Implications, KFF (2021), https://www.kff.org/report-section/use-of-race-inclinical-diagnosis-and-decision-making-overviewand-implications-issue-brief/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 such as age, are likely prevalent in patient care decision support tools and may not require extensive mitigation efforts under § 92.210(c) if use of the variable in the tool does not result in discrimination. For instance, where a tool employs an input variable for age, the covered entity’s mitigation efforts under § 92.210(c) regarding that tool may include justifying the tool’s use of age as an input variable by showing that age is clinically indicated as a measure in the particular tool and/or aligns with evidence-based clinical best practices that do not result in discrimination. We further note that the Age Act itself allows age distinctions under certain circumstances, including when related to age distinctions that reasonably take into account age as a factor necessary to the normal operation or the achievement of any statutory objective of a program or activity. 42 U.S.C. 6103(b)(1); 45 CFR 91.13 (adopting statutorily permissive age distinctions found at 42 U.S.C. 6103(b)(1)). Comment: Some commenters indicated that clinicians trust the FDA’s process for reviewing and approving clinical use of patient care decision support tools as well as published data illustrating a tool’s efficacy in their use of these tools. Response: The FDA regulates the sale of medical devices (including diagnostic tests) and monitors the ongoing safety and effectiveness of regulated marketed devices.365 The FDA has released draft guidance on Predetermined Change Control Protocol (PCCP AI/ML) 366 and will be publishing draft guidance for Artificial Intelligence/Machine Learning (AI/ML)-enabled Device Software Functions: Lifecycle Management Considerations and Premarket Submission Recommendations. In addition, FDA is actively working through public-private partnerships to set uniform guidelines on addressing bias in AI across its lifecycle. Section 92.210 is concerned with ensuring that covered entities’ use of a patient care decision support tool does not result in prohibited discrimination, which includes medical devices as 365 See U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., FDA’s Role in Regulating Medical Devices, https://www.fda.gov/medical-devices/ home-use-devices/fdas-role-regulating-medicaldevices#:∼:text=FDA%20regulates%20 the%20sale%20of,of%20all%20regulated%20 medical%20products. 366 88 FR 19648 (Apr. 3, 2023); see also U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., CDRH Issues Draft Guidance on Predetermined Change Control Plans for Artificial Intelligence/ Machine Learning-Enabled Medical Devices, https://www.fda.gov/medical-devices/medicaldevices-news-and-events/cdrh-issues-draftguidance-predetermined-change-control-plansartificial-intelligencemachine. PO 00000 Frm 00129 Fmt 4701 Sfmt 4700 37649 ‘‘automated or non-automated tool[s] . . . used by a covered entity to support clinical decision-making.’’ While FDA’s premarket review processes strive to minimize discriminatory biases in patient care decision support tools before they are authorized to market, real world postmarket deployment of FDA-approved devices can introduce discriminatory bias. Therefore, it is important to identify different points of bias and provide an action plan for remediation.367 Comment: Many commenters suggested that covered entities should share liability with algorithm creators for the consequences related to covered entities’ use of these tools because clinicians may lack sufficient information to detect that an algorithm can result in discrimination. Another commenter suggested that § 92.210 should impose strict liability on manufacturers of algorithms, not the end users. Yet another commenter suggested that OCR create a safe harbor for covered entities that use clinical algorithms consistent with and within the scope of their intended purpose. Response: Each covered entity is independently required to comply with all provisions in section 1557, including § 92.210. A covered provider’s liability under section 1557 is not contingent on or related to a developer’s potential liability under this rule or this provision. As discussed above, § 92.210(b) requires a covered entity to identify use of patient care decision support tools in its health programs and activities that employ input variables or factors that measure race, color, national origin, sex, age, or disability, and § 92.210(c) requires covered entities to make reasonable efforts to mitigate the risk of discrimination that results from the covered entity’s use of a tool identified in § 92.210(b) in clinical decision-making. If a developer is subject to section 1557, § 92.210 applies to it in the same manner it applies to all covered entities. Under § 92.210, covered entities must take requisite actions to ensure their use of a patient care decision support tool does not result in discrimination. We decline to impose strict liability on covered entities in their use of these tools, including covered developers. 367 See U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., About FDA: Patient Q&A, https:// www.fda.gov/media/151975/download#:∼: text=The%20FDA%20does%20not%20 regulate,by%20health%20insurance%20or%20 Medicare; Alessandro Hammond et al., An Extension to the FDA Approval Process Is Needed to Achieve AI Equity, 5 Nature Machine Intelligence 96 (2023), https://www.nature.com/articles/s42256023-00614-8. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37650 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: Some commenters opined that proposed § 92.210 lacked sufficient specificity and that our reference in the Proposed Rule to covered entities’ overreliance on clinical algorithms was confusing because there is no definition or criteria about what it means to ‘‘rely’’ on a clinical algorithm. Response: We appreciate commenters’ concerns. We note that § 92.210 relates to covered entities’ use of patient care decision support tools rather than their reliance on them. In the Proposed Rule, we cautioned that a covered entity’s overreliance on clinical algorithms in its decision-making can result in discrimination, and that covered entities should refrain from over-relying on patient care decision support tools by using them beyond their reasonably expected scope as a replacement or substitute for providers’ clinical judgment. 87 FR 47880–82. Comment: Some commenters characterized § 92.210 as a novel provision and argued that, in consequence, OCR investigative staff need to conduct fact-specific analyses of allegations of discrimination. Other commenters supported OCR’s proposed approach to conduct a case-by-case factual inquiry into compliance with § 92.210. Many commenters pointed out that proactive oversight by OCR is also needed due to the non-transparent, systemic nature of this form of discrimination, which may limit complaints. Response: OCR will investigate each complaint under § 92.210 on a case-bycase basis. OCR will review all applicable evidence to determine whether the covered entity took reasonable steps to identify whether the patient care decision support tool it is using is a tool that employs input variables that measure race, color, national origin, sex, age, or disability under § 92.210(b). When an investigation reveals that a covered entity has appropriately identified its use of a patient care decision support tool under § 92.210(b), OCR will determine whether the covered entity took reasonable efforts to mitigate the risk of discrimination resulting from the use of the patient care decision support tool at issue in accordance with § 92.210(c), as described above. As we have affirmed elsewhere with respect to other provisions of this final rule, OCR will employ all available means to investigate alleged violations of § 92.210, including through complaint investigations and compliance reviews based upon potential complaints in order to provide proactive oversight over the use of these tools. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Comment: A professional association commenter recommended that OCR’s enforcement actions should consider whether covered entities have set up incentives to pressure health care professionals to follow the recommendations of clinical algorithms even if they conflict with the professional’s clinical judgment. Response: We appreciate this comment, and OCR will take such situations into account on a case-by-case basis when determining whether a covered entity violates this provision as OCR evaluates the facts in complaints brought under § 92.210. Comment: Commenters recommended that OCR work with covered entities to achieve compliance by providing covered entities, specifically physician practices, with technical assistance and guidance, to help them integrate both clinical algorithms and improvements for these algorithms into existing clinical workflows to increase efficiency and minimize administrative burden. Response: OCR seeks to provide covered entities with technical assistance regarding compliance with all civil rights requirements, including compliance with § 92.210. OCR is committed to partnering with covered entities to eliminate discrimination resulting from the use of patient care decision support tools in covered entities’ health programs and activities. Comment: Some commenters were concerned that complying with § 92.210 would be difficult for smaller covered entities with fewer resources. Response: Section 92.210 applies to all covered entities regardless of size, including smaller entities. All covered entities must make reasonable efforts to mitigate the risk of discrimination resulting from their use of a patient care decision support tool identified in § 92.210(b), but the size and resources of the covered entity will factor into the reasonableness of their mitigation efforts and their compliance with § 92.210. Comment: Some commenters encouraged OCR to require covered entities to comply with § 92.210 as quickly as possible, while one commenter suggested that covered entities should be required to evaluate their algorithms and mitigate bias within 12 months. Response: We acknowledge that covered entities may need additional time to comply with the new requirements in § 92.210(b) and (c). Therefore, OCR is revising § 92.1 to reflect a delayed applicability date that specifies covered entities must comply with § 92.210(b) and (c) within 300 days following the effective date of the rule. PO 00000 Frm 00130 Fmt 4701 Sfmt 4700 Request for Additional Comment OCR seeks comment on whether we should engage in additional rulemaking to expand the scope of § 92.210, and if so, in what ways. Specifically, OCR seeks comment on other decision support tools that are being used in covered entities’ health programs and activities that do not directly impact patient care and clinical decisionmaking, but may nevertheless result in unlawful discrimination in violation of section 1557, and whether § 92.210 should apply to such decision support tools. For example, we are aware of decision support tools that are used by health insurance issuers to determine amounts owed to them or by providers for services rendered. Other examples include tools used for automated coding for billing,368 and fraud, waste, and abuse.369 Additionally, covered entities may use decision support tools for administrative and operational activities, such as patient scheduling, and we are aware that there is research suggesting that these tools can result in rushed and inadequate care for lower socioeconomic patients.370 Decision support tools may also be used to allocate resources, such as allocating spending geographically on diagnostic imaging that favors regions with historically more expensive, high-tech equipment and a lower presence of historically marginalized and underserved persons.371 OCR seeks comment on these uses and others that may result in unlawful discrimination in violation of section 1557, and whether § 92.210 should be expanded to cover these tools as well. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing § 92.210 with modifications. First, we are adding a § 92.210(a), which reads 368 See, e.g., Jessica Miller, How Is AI Quickly Taking Medical Coding to the Next Level?, Medicodio (June 6, 2023) https://medicodio.com/ how-is-ai-quickly-taking-medical-coding-to-thenext-level/#:∼:text=AI%20has%20transformed%20 medical%20coding,codes%2C%20 and%20assign%20them%20automatically. 369 See, e.g., Bill Siwicki, At UMich, AI-Based Fraud, Waste, and Abuse System Aims to Cut Costs and Protect Patients, HealthcareITNews (Aug. 1, 2023), https://www.healthcareitnews.com/news/ umich-ai-based-fraud-waste-and-abuse-systemaims-cut-costs-and-protect-patients. 370 See, e.g., Howard Fine et al., Health Care Embraces AI, Los Angeles Business Journal (June 12, 2023), https://labusinessjournal.com/specialreports/health-care-embraces-ai/. 371 See, e.g., Brent Nelson et al., Computerized Decision Support for Concurrent Utilization Review Using the HELP System, 1 J. Am. Med. Informatics Ass’n. 339 (1994), https://www.ncbi.nlm.nih.gov/ pmc/articles/PMC116216/pdf/0010339.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 the same as proposed § 92.210 except that we added ‘‘General prohibition’’ to the beginning of the provision and replaced the term ‘‘clinical algorithm’’ with the term ‘‘patient care decision support tool.’’ Second, we added § 92.210(b), which states, ‘‘A covered entity has an ongoing duty to make reasonable efforts to identify uses of patient care decision support tools in its health programs or activities that employ input variables or factors that measure race, color, national origin, sex, age, or disability.’’ Third, we have added § 92.210(c), which states, ‘‘For each patient care decision support tool identified in paragraph (b) of this section, a covered entity must make reasonable efforts to mitigate the risk of discrimination resulting from the tool’s use in the covered entity’s health programs or activities.’’ Nondiscrimination in the Delivery of Health Programs and Activities Through Telehealth Services (§ 92.211) In § 92.211, we proposed that a covered entity must not, in delivery of its health programs and activities through telehealth services, discriminate on the basis of race, color, national origin, sex, age, or disability. OCR sought comment on this approach and whether covered entities and others would benefit from a specific provision addressing accessibility in telehealth services for individuals with disabilities and individuals with LEP. We invited comment on what such a provision should include, and why the provisions at proposed §§ 92.201 (Meaningful access for individuals with LEP), 92.202 Effective communication for individuals with disabilities), and 92.204 (Accessibility of ICT for individuals with disabilities), would be insufficient. Further, we requested comment on challenges with accessibility specific to telehealth and recommendations for telehealth accessibility standards that would supplement the effective communication and ICT provisions of this part. We encouraged commenters to consider the range of technology available for accessing telehealth, including user-friendly design, as well as security and privacy requirements (for example, when using public Wi-Fi access). The comments and our responses regarding § 92.211 are set forth below. Comment: Most commenters on this issue were supportive, stating that a specific provision requiring nondiscrimination in delivery of health programs and activities through telehealth services is important for addressing health equity for VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 underserved groups and areas, social determinants of health, and improving access to a wide range of health care. Some commenters added that the expansion of telehealth has been particularly important for access to care for those who are immunocompromised or otherwise at risk for COVID–19 and potential future pandemics, those who live in rural communities, and those in need of gender-affirming care. Many commenters called for increased investment and training to promote technological literacy as a vital complement to this effort. Response: We agree that a standalone provision requiring nondiscrimination in delivery of health programs and activities through telehealth services is warranted and we appreciate the thoughtful comments. We welcome the opportunity to promote health literacy and provide technical assistance within our scope of authority. Comment: A few commenters indicated that covered entities will require additional time, technical assistance, and/or safe harbors to come into compliance with this provision, particularly if specific language access and accessibility requirements regarding telehealth platforms are incorporated. Furthermore, one commenter contended that regulation is premature since telehealth technology and platforms are too new. Response: While we appreciate the concerns expressed by covered entities, we respectfully disagree with the proposition that it is premature to regulate nondiscrimination in health programs and activities delivered via telehealth. As stated in the Proposed Rule and the Department’s joint guidance with DOJ on nondiscrimination in telehealth (Telehealth Guidance),372 covered entities that use telehealth are already prohibited from doing so in a discriminatory manner. The Telehealth Guidance explains covered entities’ responsibilities to ensure effective communication and the provision of auxiliary aids and services (section 504 and § 92.202) and the provision of language assistance services for individuals with LEP (title VI and § 92.201). Telehealth platforms, in particular, are also covered by the ICT provision (§ 92.204). Given the dramatic 372 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., U.S. Dep’t of Justice, Civil Rts. Div., Guidance on Nondiscrimination in Telehealth: Federal Protections to Ensure Accessibility to People with Disabilities and Limited English Proficient Persons (July 29, 2022), https:// www.hhs.gov/civil-rights/for-individuals/disability/ guidance-on-nondiscrimination-in-telehealth/ index.html. PO 00000 Frm 00131 Fmt 4701 Sfmt 4700 37651 expansion in the use of telehealth and continuing barriers in access to care experienced by individuals due to inaccessibility of telehealth services, we believe it is necessary and appropriate to regulate this medium of health care provision. OCR will provide further technical assistance and clarifying guidance as appropriate to help covered entities further understand their responsibilities. Comment: Some commenters requested that OCR apply a broad definition of ‘‘telehealth’’ requesting inclusion of medical devices, tests, and equipment used as part of telehealth services. Other commenters requested OCR define telehealth as ‘‘the use of digital technology to deliver health care, health information, and other health services, including diagnosis, treatment, assessment, monitoring, communications, and education.’’ Some commenters also requested that audio-only and remote patient monitoring be required to comply with §§ 92.201 (Meaningful access for individuals with LEP), 92.202 (Effective communication for individuals with disabilities), and 92.204 (accessibility of ICT for individuals with disabilities). Response: OCR has determined it is appropriate to codify the definition of the term ‘‘telehealth’’ as provided by the Health Resources and Services Administration 373 and the Office of the National Coordinator for Health Information Technology 374 referenced in the Proposed Rule at 87 FR 47884. As such, we are adding a definition for telehealth to the final rule under § 92.4. which will read ‘‘use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional health-related education, public health, and health administration. Technologies include videoconferencing, the internet, storeand-forward imaging, streaming media, and terrestrial and wireless communications.’’ Audio-only and remote patient monitoring services are included in this definition. Additionally, medical devices, tests, and equipment that are used as part of a health program or activity delivered through telehealth services must also be accessible. Comment: Some commenters requested OCR amplify and make clear 373 U.S. Dep’t of Health Hum. Servs., Health Rsch. Servs. Admin., What Is Telehealth?, https:// www.hrsa.gov/rural-health/telehealth/what-istelehealth. 374 HealthIT.gov, What Is Telehealth? How Is It Different from Telemedicine?, https:// www.healthit.gov/faq/what-telehealth-howtelehealth-different-telemedicine. E:\FR\FM\06MYR4.SGM 06MYR4 37652 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 that the privacy provisions under HIPAA are a part of this section. Many commenters detailed privacy concerns specific to individuals with disabilities and individuals with LEP. For individuals with disabilities, concerns were expressed for those who lack privacy in the home and might need additional functionality to be able to use telehealth privately.375 Other commenters described concerns individuals with LEP may have about their data being shared with immigration or law enforcement.376 Response: Comments related to HIPAA are outside of the scope of this rulemaking. However, we direct commenters to HIPAA guidance we have released related to HIPAA and reproductive health care,377 protecting the security of health information,378 and audio-only telehealth.379 Given our responsibility for HIPAA, OCR is very sensitive to privacy concerns among both people with disabilities and individuals with LEP and we remain committed to protecting their privacy and confidentiality.380 Comment: One commenter requested that OCR clarify that proposed § 92.211 on nondiscrimination through telehealth services does not apply to prescribing medication abortion or referring for abortion. Response: The specific content of the health services provided via telehealth is beyond the scope of this rulemaking. In the same way in which we have 375 Rupa S. Valdez et al., Ensuring Full Participation of People with Disabilities in an Era of Telehealth, 28 J. Am. Med. Inform. Ass’n 389 (Feb. 2021), https://www.ncbi.nlm.nih.gov/pmc/ articles/PMC7717308/. 376 Aswita Tan-McGrory et al., Addressing Virtual Care Disparities for Patients With Limited English Proficiency, The Am. J. of Managed Care (2022) https://www.ajmc.com/view/addressing-virtualcare-disparities-for-patients-with-limited-englishproficiency. 377 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., HIPAA Privacy Rule and Disclosures of Information Relating to Reproductive Health Care (June 29, 2022), https://www.hhs.gov/hipaa/forprofessionals/privacy/guidance/phi-reproductivehealth/. 378 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Protecting the Privacy and Security of Your Health Information When Using Your Personal Cell Phone or Tablet (June 29, 2022), https://www.hhs.gov/hipaa/for-professionals/ privacy/guidance/cell-phone-hipaa/. 379 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Guidance on How the HIPAA Rules Permit Covered Health Care Providers and Health Plans to Use Remote Communication Technologies for Audio-Only Telehealth (Jun. 13, 2022), https:// www.hhs.gov/hipaa/for-professionals/privacy/ guidance/hipaa-audio-telehealth/. 380 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., A Health Care Provider’s Guide to the HIPAA Privacy Rule: Communicating with a Patient’s Family, Friends, or Others Involved in the Patient’s Care (Sept. 16, 2008), https:// www.hhs.gov/sites/default/files/provider_ffg.pdf. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 generally declined to revise the final rule to address how a particular provision applies in the context of the provision of a particular type of care, we decline to do so here as well. Comment: Many commenters wrote that ensuring equitable payment for and access to telehealth across a range of modalities (including audio-only telehealth, audio-video telehealth, realtime text, and in-person services), as well as making payment rules for telehealth implemented during the COVID–19 Public Health Emergency permanent, is needed to ensure nondiscrimination in the administration of telehealth. Other commenters said that audio-only telehealth should be reimbursed for individuals without smartphones or reliable broadband service. One State commenter requested CMS provide additional guidance on how this rule would impact service delivery in rural areas in light of CMS’ audio-only service delivery in Medicare. Response: Although OCR is cognizant of and sensitive to health equity concerns involving coverage and payment policies for health care services delivered via telehealth, such policies are outside the scope of OCR authorities and the section 1557 rulemaking. However, in general, OCR does not expect the rule to affect audioonly delivery of Medicare services in rural areas. Comment: Several commenters wrote that inadequate reimbursement of telehealth and disparate medical management requirements limiting access to telehealth are discriminatory and that such practices ought to be prohibited. Response: OCR will consider complaints raising the issues of whether inadequate reimbursement of telehealth or disparate medical management requirements limiting access to telehealth is discriminatory under section 1557 on a case-by-case basis. To the extent a covered entity’s telehealth policies or practices delay or deny an individual’s access to a health program or activity delivered via telehealth, OCR will consider whether the delay or denial is based on prohibited grounds under section 1557 as set forth in this rule, including as a discriminatory benefit design prohibited under § 92.207(b)(2). Covered entities have flexibility in determining the reimbursement rates and medical management requirements in their plans, and this rule does not establish specific reimbursement requirements or medical management requirements. However, as noted elsewhere in this preamble, such practices must be PO 00000 Frm 00132 Fmt 4701 Sfmt 4700 implemented in a nondiscriminatory manner. Comment: Some commenters requested the rule prohibit covered entities from requiring individuals to use telehealth for programs, services, and assessments for which telehealth is inappropriate or risks substandard services or findings. Some commenters also asked OCR to require covered entities to offer in-person alternatives to telehealth services. Response: OCR recognizes that not all health programs and activities are appropriately delivered via telehealth, and OCR will review complaints related to payers or providers that require individuals to receive programs, services, or assessments via telehealth for potential discrimination concerns. However, we decline to issue a blanket prohibition on the use of telehealth in specific circumstances as requested by commenters, as the use in those situations may not be per se discriminatory or there may be a legitimate, non-discriminatory reason for the practice. A covered entity may need to offer inperson alternatives to telehealth, as a reasonable modification for individuals with disabilities who cannot be properly provided with effective communication or as a reasonable step to provide meaningful access for individuals with LEP through telehealth services. However, we decline to implement a general requirement that covered entities providing telehealth offer an inperson alternative. Comment: Many commenters urged that individuals with a disability be afforded the opportunity to choose between telehealth and in-person care based on the service delivery model that works better for their health and communications needs and urged the inclusion of an opt-out provision. Response: Any individual with a disability who needs to opt-out from receiving care via telehealth should request a reasonable modification of policies and procedures from the covered entity. Unless the reasonable modification fundamentally alters the health program or activity, the covered entity should approve an in-person visit. Comment: A number of commenters called on OCR to codify WCAG 2.0 (AA), WCAG 2.1 (AA),381 section 508, or related standards for telehealth platforms. Some recommended requiring certifications of compliance 381 Web Content Accessibility Guidelines 2.1 (AA), W3C World Wide Web Consortium Recommendation, https://www.w3.org/TR/ WCAG21/. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations from covered entities. One commenter recommended that covered entities be required to attest to making their best effort to accommodate patient needs. Another commenter suggested an elaborate alternative regulatory scheme that would treat telehealth platforms like public accommodations. Other commenters suggested that standards should be adopted in such a manner as to grant covered entities time to come into compliance, and others suggested safe harbors for compliance if a covered entity meets WCAG standards. Response: OCR recognizes that this is a complex and evolving area, and given the rapid evolution of platforms and technologies, we have decided not to adopt specific accessibility standards at this time for telehealth platforms, particularly given other ongoing rulemakings in this field. Both OCR and DOJ recently issued NPRMs addressing the accessibility of web content and mobile apps used by recipients of Federal financial assistance and public entities, respectively.382 Those rulemakings provide greater clarity on obligations to ensure that web content and mobile applications are accessible. This rulemaking requires covered entities to ensure telehealth platforms are accessible to individuals with disabilities, unless doing so would impose undue financial and administrative burdens or would result in a fundamental alteration in the nature of a covered entity’s health programs or activities. Specifically, OCR notes that communications before, during, and after telehealth appointments must be accessible to individuals with disabilities and individuals with LEP, consistent with pre-existing section 504, title VI, and section 1557 requirements. Comment: A number of commenters recommended expanding the nondiscrimination requirement of § 92.211 to designated companions or caregivers of people with disabilities, since shared involvement is often necessary to set and facilitate telehealth appointments. Response: Yes, companions with disabilities are covered under the effective communications requirements of this rule at § 92.202, and therefore we do not believe this language needs to be added. Companions with LEP are similarly covered under the meaningful access requirements of this rule at § 92.201. Comment: Many commenters stated that providers should assess individuals with disabilities seeking to use telehealth platforms for visual, 382 See 88 FR 63392 (Sept. 14, 2023) (HHS) and 88 FR 51948 (Aug. 4, 2023) (DOJ). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 cognitive, intellectual, mobility, and functional needs, and that platforms should be adapted to address the needs of a wide variety of people with diverse functional limitations who have difficulties communicating through traditional telehealth, including, but not limited to, people with visual, hearing, and speech disabilities. Response: OCR agrees that such an assessment would be informative and is recommended as a best practice and as a means of connecting individuals with the most appropriate auxiliary aids and services to meet their needs. However, OCR has concluded it is important to allow covered entities flexibility in determining whether to assess individuals with disabilities seeking to use telehealth platforms. We therefore decline to adopt an assessment requirement at this time. However, OCR will continue to monitor developments in methodology for assessing individuals with disabilities. Comment: Many commenters recommended that covered entities be required to provide individuals with a Notice of Availability (§ 92.11) when covered entities electronically communicate to individuals that they may make telehealth appointments with the covered entity. Response: Such a scheduling communication is already covered by § 92.11(c)(5)(v), because it relates to services that ‘‘require or request a response from a participant, beneficiary, enrollee, or applicant.’’ Comment: A significant number of commenters recommended adopting detailed specifications and performance standards for accessibility features on telehealth platforms for individuals with specific disabilities. Several commenters also said OCR needed to provide specific requirements related to qualified interpreters on telehealth platforms with ‘‘specific provisions addressing accessibility in telehealth services and particularly related to access for individuals with disabilities and LEP individuals.’’ Response: While OCR appreciates commenters’ request for detailed performance standards, we decline to adopt such provisions at this time given the rapid evolution of platforms and technologies. Requirements addressed elsewhere in the rule, including at §§ 92.201 (Meaningful access for individuals with LEP) and 92.202 (Effective communication for individuals with disabilities), provide a baseline from which covered entities can tailor their compliance. OCR will continue to consider issuing additional guidance on this topic. PO 00000 Frm 00133 Fmt 4701 Sfmt 4700 37653 Comment: One commenter wrote that audio-only visits are inherently inferior to audio-visual telehealth visits as they exclude information and meaning conveyed through visual cues, increasing chances for poor communications, misdiagnoses, flawed evaluations, and other subpar outcomes. This commenter advised requiring inperson care be available on the same terms as telehealth. Response: Although OCR appreciates the comment and recognizes that audioonly telehealth communication may not be appropriate for all circumstances, we decline to disallow audio-only as an option for telehealth delivery. We believe this would erect an unnecessary and unjustified barrier to telehealth for individuals who lack the quality or consistent internet access necessary for audio-visual telehealth. As stated previously, a covered entity may need to offer in-person alternatives to telehealth to ensure effective communication for individuals with disabilities (section 504, the ADA, and section 1557), or meaningful access for individuals with LEP (title VI and section 1557), but we decline to implement a general requirement that in-person care be available on the same terms as telehealth. For further information, we once again direct commenters to the Telehealth Guidance.383 Comment: One commenter wrote that, given that telehealth is incorporated in ‘‘information and communication technology for individuals with disabilities’’ (§ 92.204), it would be helpful to explain the interaction between these two sections. Response: This commenter is correct that telehealth is closely related to the ICT section. ICT is generally a means by which to facilitate access to information in a health program or activity, whereas telehealth is a medium through which a health program or activity is delivered and for which access is needed. Health programs and activities provided through ICT include telehealth, which we define as the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional health-related education, public health, and health administration. In contrast, ICT relates to the technology and other equipment, 383 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., U.S. Dep’t of Justice, Civil Rts. Div., Guidance on Nondiscrimination in Telehealth: Federal Protections to Ensure Accessibility to People with Disabilities and Limited English Proficient Persons (July 29, 2022), https:// www.hhs.gov/civil-rights/for-individuals/disability/ guidance-on-nondiscrimination-in-telehealth/ index.html. E:\FR\FM\06MYR4.SGM 06MYR4 37654 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations such as computers and peripheral equipment; information kiosks and transaction machines; telecommunications equipment; telehealth interfaces or applications; customer premises equipment; multifunction office machines; software; mobile applications; websites; videos; and electronic documents. Thus, while telehealth interfaces and applications are a form of ICT, the rapid expansion of its use by providers and broad impact on the health care landscape necessitate careful consideration independent of a broader ICT section. The telehealth section is designed to ensure that health programs and activities delivered via telehealth technologies are done so in a manner that does not discriminate. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.211 without modification. Subpart D—Procedures ddrumheller on DSK120RN23PROD with RULES4 Enforcement Mechanisms (§ 92.301) Proposed § 92.301 provides that the enforcement mechanisms available for and provided under title VI of the Civil Rights Act of 1964, title IX of the Education Amendments of 1972, section 504 of the Rehabilitation Act of 1973, and the Age Discrimination Act of 1975 shall apply for purposes of section 1557 as implemented by the part. The comments and our responses regarding § 92.301 are set forth below. Comment: Many commenters strongly supported OCR’s clarification that section 1557 provides an independent basis for regulation of discrimination in covered health programs and activities. Supporters indicated that the rule as proposed would provide for robust enforcement of section 1557, consistent with existing law and the clear intent of Congress. One commenter expressed support for the different mechanisms of enforcement and emphasized the importance of enforcement that is level, targeted, and constant to ensure longterm adherence to section 1557’s nondiscrimination provisions. Response: OCR appreciates and acknowledges the need for strong enforcement mechanisms in order to adequately address discrimination in health programs and activities. Comment: One commenter noted that making a clear procedure for claims of discrimination on multiple bases is important, not only for the complainant to fully understand their rights and remedies, but also for the covered entity to know how best to respond to a VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 grievance. Commenters also suggested that OCR provide guidance on how covered entities should proceed with complaints that involve multiple bases of discrimination. Response: OCR agrees that it is important to provide clarity to both complainants and covered entities regarding the procedures for raising a claim under section 1557. We currently offer resources on our website to provide the public and covered entities with information about the complaint process and how covered entities implement and maintain compliance. As discussed in § 92.303, in an effort to simplify the complaint process, OCR is revising the regulatory text to apply a single administrative enforcement procedure for discrimination complaints filed under section 1557, regardless of the alleged basis of discrimination. This will eliminate confusion for both covered entities and the public with regard to how OCR will evaluate and investigate allegations of discrimination brought under this part, including allegations involving multiple bases of discrimination. Covered entities should handle section 1557 grievances involving multiple bases of discrimination under one process. OCR will continue to provide guidance to covered entities on an ongoing basis to ensure compliance with the rule. Comment: Several commenters stated that section 1557 creates a healthspecific, nondiscrimination private cause of action. They opine that, because Congress expressly adopted one provision to prohibit discrimination on multiple grounds, the enforcement mechanisms available under each of the referenced statutes are not intended to be limited to the particular ground of alleged discrimination but rather would be available regardless of the ground of discrimination at issue. Many commenters strongly recommended that OCR expressly state, as it did in the 2016 Rule preamble, that it will interpret section 1557 as authorizing a private right of action for claims of disparate impact for all grounds of prohibited discrimination. They stated that making the private right of action language explicit in the rule will provide for transparency and patient protection and enable more consistent enforcement of section 1557. Commenters stated that without a disparate-impact theory of liability, a private right of action will ring hollow for people of color and other systemically marginalized groups. Additionally, commenters noted that in an era where artificial intelligence and automated decision-making are increasingly responsible for resource PO 00000 Frm 00134 Fmt 4701 Sfmt 4700 allocation, recognition of disparateimpact liability is critical. Other commenters noted that a private right of action is essential to ensuring that individuals who experience discrimination on the basis of sex in health care are not solely reliant on OCR to enforce the law and may be entitled to seek compensation through a private right of action for the harm they experience. Commenters further stated that the Supreme Court has affirmed the right of all private individuals to sue in Federal court to challenge violations of the protections of section 1557. Other commenters noted that a private right of action is essential to ensuring that individuals who experience discrimination on the basis of sex in health care are not solely reliant on OCR to enforce the law. Commenters also stated that by expressly including enforcement mechanisms ‘‘available under’’ the statutes, Congress authorized disparate-impact claims to be brought under section 1557. Finally, commenters raised specific concerns regarding the Age Act’s administrative exhaustion requirement, 42 U.S.C. 6104(f), and many commenters recommended that OCR include regulatory language in the final rule clarifying that administrative exhaustion is not required before a court action involving multiple bases of discrimination that includes age can be filed by the complainant. These commenters stated that because section 1557 is its own statute—enforceable by private right of action in the courts—an older adult who is discriminated against based on age and another basis should not be disadvantaged due to the Age Act’s administrative-exhaustion requirement. Response: Courts have long recognized that section 1557 authorizes a private right of action under any of the bases for discrimination. OCR declines to revise regulatory text to adopt a stance on the appropriate standards that apply to private litigants. This is an issue appropriately addressed by the Federal judicial branch and not via agency rulemaking. Comment: One commenter requested that OCR clarify whether providers caring for individuals with disabilities and relatives of such individuals have the ability to bring a civil rights action in appropriate cases, such as where the provider or relative are themselves harmed by the plan’s discriminatory conduct. Response: OCR cannot provide legal advice as to whether an individual can appropriately bring a private claim under section 1557. If an individual— E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations including providers and relatives of a plan holder—believes they have experienced discrimination prohibited by section 1557, they are able to file a complaint with OCR. OCR will conduct a case-by-case analysis to determine its jurisdiction over the complaint allegations. Comment: Some commenters urged OCR to increase enforcement capacity through coordination among agencies within the Department, and that the final rule should authorize OCR to empower other Department components, such as CMS, to investigate and enforce section 1557 claims. Response: As a law enforcement agency with specialized knowledge and delegated authority over section 1557 enforcement, OCR is the agency within the Department that investigates and enforces section 1557 complaints. However, OCR continues to work with other agencies on many different initiatives and issues, including to promote compliance with Federal civil rights laws such as section 1557. Comment: Some commenters suggested that OCR should pair enforcement with robust outreach and education. Several commenters requested that OCR postpone any enforcement action until after OCR provides education resources and technical assistance, to allow time for different practices to come into compliance without penalty. Several commenters requested that OCR use enforcement discretion for particular groups of providers. For example, one commenter asked OCR to provide assurances that pharmacists can use reasonable clinical judgment to treat patients within their scope of practice, and not be subject to additional administrative burden and legal liability. Another commenter requested that OCR use enforcement discretion and not penalize physicians for failing to provide interpreter services as long as they make reasonable efforts to satisfy the final rule’s requirements. This commenter also requested that OCR provide guidance and support for physicians in rural and other hard to reach areas for procuring and using the necessary technology to connect with remote interpreters. Specifically, this commenter pointed to concerns with physician practices in remote areas where interpreter availability is inconsistent and remote connectivity to interpreter services is either substandard or non-existent due to the lack of necessary broadband. Response: We appreciate the commenters’ concern, but section 1557 has been in effect since 2010 and OCR VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 declines to postpone enforcement past the effective date of 60 days after publication of the final rule. We note, however, that we have provided delayed implementation dates for a number of provisions. Further, prior to taking an enforcement action (i.e., terminating Federal financial assistance or referring a matter to DOJ for enforcement), OCR must attempt to achieve a covered entity’s voluntary compliance with the law, such as through providing technical assistance and reviewing policies and procedures.384 Comment: Some commenters recommended adding a new provision requiring OCR to publish general information about the number and types of complaints received and resolved on a yearly basis and to publicly post information regarding resolution agreements within 14 days of resolving a complaint. Response: Much of the information requested is already provided to Congress annually through OCR’s Congressional Justifications and these annual justifications are also available on OCR’s website.385 In addition, OCR posts its resolution agreements to its website, available to anyone to review. We intend to continue with this practice as more cases are resolved. Comment: Some commenters were also concerned with mandatory arbitration agreements and recommended that OCR include a specific provision prohibiting insurers from requiring binding arbitration as the exclusive means to resolve a complaint arising under section 1557. These commenters were concerned that binding arbitration greatly favors defendants, particularly large corporations. Response: OCR appreciates concerns with regards to arbitration but notes that agreements between private parties is beyond the scope of this rulemaking. Summary of Regulatory Changes For the reasons set forth above and in the Proposed Rule and considering the comments received we are finalizing the provisions as proposed in § 92.301, without modification. 384 See, e.g., U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., HHS Office for Civil Rights Resolves Complaints with CVS and Walgreens to Ensure Timely Access to Medications for Women and Support Persons with Disabilities (June 16, 2023), https://www.hhs.gov/civil-rights/forproviders/compliance-enforcement/agreements/cvswalgreens/. 385 Current and past OCR Congressional Justifications can be found at https://www.hhs.gov/ ocr/about-us/budget/. PO 00000 Frm 00135 Fmt 4701 Sfmt 4700 37655 Notification of Views Regarding Application of Federal Religious Freedom and Conscience Laws (§ 92.302) In proposed § 92.302, OCR proposed an administrative process under which recipients can notify OCR of their views that they are exempt from certain provisions of section 1557 due to an applicable Federal conscience or religious freedom law. This proposed provision was not in either the 2016 or 2020 Rule. Proposed § 92.302(a) provided that a recipient may notify OCR of its view that it is exempt from certain provisions of this part due to the application of a Federal conscience or religious freedom law. Proposed § 92.302(b) provided that once OCR receives such notification from a particular recipient, OCR shall promptly consider those views in responding to any complaints or otherwise determining whether to proceed with any investigation or enforcement activity regarding that recipient’s compliance with the relevant provisions of this part. We further explained that any relevant ongoing investigation or enforcement activity regarding the recipient shall be held in abeyance until a determination has been made under § 92.302(c). Proposed § 92.302(c) provided that based on the information provided in the notification under Proposed § 92.302(a), OCR may determine at any time whether a recipient is exempt from the application of certain provisions of this part, or whether modified application of the provision is required with respect to specific contexts, procedures, or health care services, based on an applicable Federal conscience or religious freedom law. In doing so, we further explained that OCR will assess whether there is a sufficiently concrete factual basis for making a determination and will apply the applicable legal standard of the relevant law. Proposed § 92.302(c) also provided that OCR will communicate its determination to the recipient. Proposed § 92.302(d) provided that if OCR determines that a recipient is exempt from the application of certain provisions of this part or modified application of the provision is required as to specific contexts, procedures, or health care services, based on a Federal conscience or religious freedom law, that determination does not otherwise limit the application of any other provision of this part to the recipient or to other contexts, procedures, or health care services. The comments and our responses regarding § 92.302 are set forth below. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37656 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: Many commenters expressed support for the proposed provision primarily because, in their view, § 92.302 would balance the need to protect both the religious and conscience views of recipients and the civil rights protections for patients, providers, and consumers. In commenting on the purpose of section 1557, one religious, organizational commenter stated that it ‘‘strongly supports the principle of nondiscrimination in health programs and activities established by the ACA and the promulgation of regulations to ensure that principle is implemented robustly’’ because ‘‘[a]ccess to health care is essential to promote and protect the inherent and inalienable worth and dignity of every individual.’’ Another religious, organizational commenter stated that ‘‘[e]nsuring access to health coverage and health care, and removing barriers to these, is without question a laudable goal.’’ Response: OCR appreciates these commenters’ views and agrees that § 92.302 allows OCR to fully consider and uphold religious freedom and conscience laws as well as civil rights laws for patients, providers, and consumers, to ensure broad access to health care for all individuals. Comment: Many other commenters opposed the addition of § 92.302. Commenters maintained that the process for notifying OCR of their exemption requests would burden religious entities and favor the interests of third parties. Some commenters raised concerns that claims of thirdparty harms can be used by opponents of religious liberty as a basis for denying any religious exemption. Additionally, a few commenters asserted that any investigation by OCR that excludes consultation with the Conscience and Religious Freedom Division will lead to religious and conscience objectors losing to claims of third-party harms. Commenters thus requested that OCR explain the types of harm that may overcome religious objections. Response: OCR appreciates commenters’ objections to § 92.302 and recognizes the request for guidance and clarification. In response to commenters who stated that the notification process itself burdens religious entities, OCR has added clarifications to the regulatory text stating that recipients may rely on the protections in religious freedom and conscience laws or seek further assurance of these protections from OCR, if they wish. OCR notes that under revised § 92.302, recipients are not required to seek assurance of an exemption in advance but may raise a claim under an applicable Federal VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 religious freedom and conscience protection in the context of an OCR investigation or enforcement action. Also, we have revised § 92.302(a) to make clear that, insofar as the application of any requirement under this part would violate applicable Federal protections for religious freedom and conscience, such application shall not be required. This language is consistent with language added to § 92.3(c) and has been interpreted by courts to support the Department’s position that it ‘‘will abide by RFRA in any enforcement of Section 1557’’ and that the Department ‘‘has never enforced section 1557 to require a provider with a religious objection to perform gender transition services.’’ Am. Coll. of Pediatricians v. Becerra, 2022 WL 17084365 (E.D. Tenn. 2022) (citing to this language from the 2016 Rule as support). In making determinations under § 92.302, OCR will faithfully apply the legal standards set forth in the Federal religious freedom or conscience law at issue. For example, RFRA provides that the Federal Government may not substantially burden a person’s exercise of religion unless ‘‘it demonstrates that application of the burden to the person—(1) is in furtherance of a compelling governmental interest; and (2) is the least restrictive means of furthering that compelling governmental interest.’’ 42 U.S.C. 2000bb–1(b). Further, while case law interpreting RFRA requires consideration of any potential third-party harms, such harms, where relevant, are one of several factors that will be considered. Other Federal religious freedom and conscience laws set forth different tests. For example, a provision of the Church Amendments, 42 U.S.C. 300a–7, states that the receipt of Federal financial assistance (under certain statutes implemented by HHS) ‘‘by any individual or entity does not authorize any court or any public official or other public authority to require . . . such individual to perform or assist in the performance of any sterilization procedure or abortion if his performance or assistance in the performance of such procedure or abortion would be contrary to his religious beliefs or moral convictions,’’ id. 300a–7(b)(1). When administering its exemption process, OCR will carefully apply the text of these statutes and judicial precedents interpreting them, including by being mindful of the ways in which the texts of these statutes differ from one another. We continue to believe that this approach is most consistent with the Federal religious freedom and conscience protections. In addition, PO 00000 Frm 00136 Fmt 4701 Sfmt 4700 OCR has consulted with the appropriate Department staff regarding the application of religious freedom and conscience protections during this rulemaking and will continue to engage staff during OCR’s enforcement of the final rule. Comment: Many commenters said that by not allowing a categorical preenforcement exemption and instead making the exemption process case-bycase, OCR will increase doubt among providers, inviting constant reliance upon administrative adjudication and litigation that will cost unnecessary time and money. Some commenters asserted that OCR’s consideration of claims on a case-by-case basis is problematic for large health care systems with multiple sites of care. These commenters raised concerns that hospital systems would be deprived of the clarity and certainty needed to adhere to their religious principles and to establish compliance with policies covering all member hospitals, such that the health system would ensure that claimed exemptions were being appropriately and narrowly applied. These commenters claimed that because a recipient would be left with significant uncertainty until OCR considered any enforcement action, the process of claiming a pre-enforcement exemption with OCR affords few assurances of future enforcement protections. Still, many other commenters supported the § 92.302 process because, in their view, such a case-by-case inquiry allows OCR an opportunity to consider objections in the contextspecific manner that Federal religious freedom laws like RFRA require. Many commenters emphasized that in the context of health care under section 1557, the government has a compelling interest in not only preventing discrimination but ensuring taxpayer dollars are not used to further discrimination. Other commenters, however, asserted that RFRA imposes an affirmative obligation on the government to respect and protect religious liberty and is not a defensive argument for individuals to raise on a case-by-case basis. Response: OCR understands some commenters’ concerns and opposition to the proposed provision requiring caseby-case determinations. OCR maintains an important civil rights interest in the proper application of Federal conscience or religious freedom protections, which requires taking a case-by-case approach to such determinations. Among other things, this allows OCR to determine whether the government has a compelling E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 interest in denying an exemption to a particular party; 386 to consider, when relevant under the applicable legal standard, any harm an exemption could have on third parties, including other recipients, providers, patients, and the public; and to evaluate whether imposing burdens on a covered entity is the least restrictive means of furthering a compelling government’s interest.387 However, to address commenters’ concerns, OCR has revised § 92.302(a) to state that a recipient may ‘‘rely on applicable Federal protections for religious freedom and conscience, and consistent with § 92.3(c), application of a particular provision(s) of this part to specific contexts, procedures, or health care services, shall not be required where such protections apply.’’ When a recipient acts based upon its good faith reliance that it is exempt from providing a particular medical service due to the application of relevant religious freedom and conscience protections (e.g., RFRA), OCR will not seek backward-looking relief against that recipient even if the recipient had not affirmatively sought assurance of an exemption under § 92.302(b). But if OCR determines, after an investigation, that the recipient does not satisfy the legal requirements for an exception, it will seek forward-looking relief as appropriate under the facts. If the recipient wishes to receive an assurance from OCR regarding an exemption under any applicable religious freedom and conscience laws, it may do so under § 92.302(b) either prior to, or during the course of, an investigation. We understand that there was some confusion regarding the ‘‘case-by-case approach’’ discussed in how OCR proposed to evaluate exemption requests under § 92.302(b). We clarify here that a recipient may seek assurance of an exemption applying to specific contexts, procedures, or health care services generally. When OCR makes a case-bycase determination, this refers to the evaluation of the exemption assurance request as a whole—which may be requesting assurance of an exemption from a category of procedures or health care services. Thus, when we indicate that exemption requests will be evaluated on a case-by-case basis, this 386 Fulton v. City of Phila., 593 U.S. 522, 541–42 U.S. (2021). 387 See Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682, 739 (2014) (Kennedy, J., concurring) (‘‘Among the reasons the United States is so open, so tolerant, and so free is that no person may be restricted or demeaned by government in exercising his or her religion. Yet neither may that same exercise unduly restrict other persons, such as employees, in protecting their own interests, interests the law deems compelling.’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 does not mean that a recipient must seek assurance of an exemption each time such procedure or health care is sought if an exemption already applies. Rather, a recipient may demonstrate that it is entitled to an exemption due to a religious or conscience objection to a particular provision in this part, as applied to specific contexts, procedures, or health care services. A recipient may obtain assurance of its exemption in multiple ways under § 92.302(b). For example, if a recipient is seeking assurance of an exemption while there is no investigation pending, the notification to the OCR Director under § 92.302(b) would include: (1) identification of the provision of care to which the covered entity objects, specifying whether the objection is to the service overall or to the provision of care in a specific circumstance (per item (1)); (2) an explanation of the legal basis supporting the claim (per item (2)); and (3) the factual basis supporting the claim (per item (3)). Thus, for example, if a Catholic hospital is seeking an assurance of an exemption from having to perform sterilization procedures that would conflict with the religious tenets of their institution, their notification under § 92.302(b) would potentially include: (1) the provision to which there is an objection and that the objection is to provision of a procedure overall, i.e., sterilization procedures that are prohibited by their religious tenets; (2) that they should be exempt under a specified religious freedom or conscience law; and (3) evidence that it, for example, never provides sterilization in violation of a particular religious or conscience belief for any patient, no matter their sex. Alternatively, if a covered entity is seeking assurance of an exemption during an OCR investigation, it may similarly submit a notification under § 92.302(b). This notification would include the same information, but the factual basis for the claim would also discuss the specific context of the investigation in question. Though raised in response to a specific complaint allegation, the recipient may use this same notification to seek assurance of an exemption for the same circumstances going forward. To take an example drawn from enforcement experience, OCR investigated allegations that a Catholic hospital discriminated against the complainant when it refused to allow his physician to perform a hysterectomy as a form of gender affirming care at their facility. The hospital confirmed during the investigation: (1) it did not perform the particular type of care or procedure (hysterectomy) on any patient PO 00000 Frm 00137 Fmt 4701 Sfmt 4700 37657 under the circumstances (as it performs ‘‘direct sterilization’’ only for ‘‘the cure or alleviation of a present and serious pathology and a simpler treatment is not available’’); (2) that it was raising a defense under RFRA, citing the relevant legal standard; and (3) the factual basis for not providing such medical care and how the hysterectomy request conflicted with the exercise of its religious beliefs. OCR evaluated the complaint and the hospital’s response in light of its obligations under RFRA, and determined that to require the hospital to allow the procedure in question to take place at their facility would result in a substantial burden on their religious exercise. OCR further found that section 1557’s prohibition on sex discrimination as applied to the facts of this case was not the least restrictive means of achieving the government’s compelling interest in preventing discrimination and therefore closed the matter. Comment: Some commenters who supported the provision expressed appreciation that the process outlined in § 92.302 would allow OCR to consider an exemption’s potential harms to third parties, such as patients or the public. Many commenters believed that this type of exemption process is structured to promote equity and transparency, while ensuring compliance with relevant legal requirements. Multiple commenters shared stories about denials of care, including in medical situations in which patients were seeking emergency services. One commenter reported an instance in which a woman was forced to deal with serious health complications when her treatment was delayed after emergency room staff learned of her sexual orientation. In another example, a commenter recalled that a pediatrician’s office refused to make an appointment for an infant because the patient’s parents were lesbians. Other commenters said a hospital refused to allow doctors with admitting privileges to provide their patients with, for instance, medically necessary gender-affirming care inside their facilities. Many commenters stated that even where patients are able to obtain the services from another provider, the delay in receiving care may cause irreparable harm. Multiple commenters described that the stress of being denied medical care and the fear of facing similar denials in the future can have serious negative health outcomes. Some commenters who supported proposed § 92.302 compared the provision to the title IX religious exception, explaining that they preferred an administrative process that E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37658 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations protects religious liberty, such as that proposed in § 92.302, over an exception that might be too broad. Response: OCR appreciates these comments and agrees that the § 92.302 exemption process is the better approach. Although commenters compared the proposed § 92.302 process with the title IX religious exception when expressing their support, OCR makes clear that the process provided under § 92.302 is separate and apart from title IX and this new provision does not rely upon or effectuate title IX’s religious exception. Rather, as explained above, this provision clarifies the applicability of religious freedom and conscience protections and provides a process for OCR to respect applicable Federal religious freedom and conscience laws for specific recipients, whether or not they are religious organizations, in its enforcement of section 1557. Comment: Several commenters who opposed this provision requested that OCR provide recipients with a categorical exemption, similar to what, in their view, was captured by the 2020 Rule through the importation of the title IX religious exception. In these commenters’ view, such importation would provide a categorical exemption from providing procedures that would violate their religious beliefs. Many commenters also argued for incorporation of the title IX religious exception to address their concerns over what they viewed as the complexities, inconsistencies, and unpredictable nature of the § 92.302 process. Many other commenters also stated that the process at § 92.302 is too burdensome and unclear, and in their view, it would effectively prohibit a provider from abstaining from procedures that violate their religious convictions. Additionally, some commenters stated that these burdens were unfair to religious employers, especially small employers, who the commenters said will refrain from applying for Federal funding, further harming patients due to limited providers. A few commenters stated that, as proposed, § 92.302 forces religious entities to expose themselves to potential sanctions by requesting an exemption. Requesting any exemption, commenters argued, makes the recipient a target for an agency that, in their view, is a ‘‘bully’’ to religious organizations. Several commenters expressed concerns that in requesting an exemption, the recipient will lose, in their views, its ‘‘privacy and anonymity,’’ which could have a chilling effect on its provision of health care services. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Response: OCR appreciates and respects commenters’ concerns relating to their religious convictions. The § 92.302 process demonstrates OCR’s concerted effort to enforce Federal antidiscrimination laws and apply Federal religious freedom and conscience laws. Section 92.302 provides an administrative process, not implemented in either the 2016 or 2020 Rule, which responds to the shortcomings of both rules. Through the § 92.302 process, OCR is committed to implementing a rule that clarifies legal obligations and maintains transparency about its enforcement mechanisms. Moreover, as previously addressed, supra, at § 92.208, OCR complies with the protections in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments; the generally applicable requirements of RFRA; and other applicable Federal laws that provide religious freedom and conscience protections—§ 92.302 provides an administrative process through which providers may rely upon and assert these protections.388 This provision helps ensure that recipients have an opportunity to seek assurance from OCR about the application of religious freedom and conscience protections. OCR does not seek to deprive a recipient of their ‘‘privacy or anonymity,’’ and the information requested is only that which is necessary to provide assurance of the exemption or modification that the recipient is seeking. To clarify further, recipients may seek an assurance of an exemption under these Federal religious freedom and conscience laws at various points in time, including prior to an investigation or during an ongoing OCR proceeding. To begin, as explained above, a recipient may avail itself of the general application of § 92.302(a) and ‘‘rely on applicable Federal protections for religious freedom and conscience, and application of a particular provision(s) of this part to specific contexts, procedures, or health care services, shall not be required.’’ Should the recipient seek an assurance, it may—prior to any administrative investigation and enforcement—do so by filing a notification with OCR under § 92.302(b). OCR will then acknowledge receipt of the notification within 30 days, and the recipient may rely on a temporary exemption, per § 92.302(c)(1), while OCR adjudicates the assurance of exemption request. In instances where OCR has already initiated an 388 See also U.S. Dep’t of Health & Hum. Servs., Safeguarding the Rights of Conscience as Protected by Federal Statutes, Final Rule, 89 FR 2078 (Jan. 11, 2024). PO 00000 Frm 00138 Fmt 4701 Sfmt 4700 investigation, the recipient may, during the pendency of that investigation, similarly notify OCR of their belief they are entitled to an exemption under the process provided at § 92.302(b). The notification will serve as a defense to the relevant investigation or enforcement activity, and a temporary exemption will then be in place per § 92.302(c)(2), pending OCR’s determination regarding the request for assurance of the exemption or the conclusion of the investigation. Finally, OCR disagrees with and respectfully objects to the characterization that it seeks to ‘‘bully’’ religiously affiliated recipients or expose them to potential sanctions. Religiously affiliated hospitals and health care facilities play a large role in the health care system, and OCR recognizes the critical patient care needs they provide, particularly in reaching underserved communities. As previously stated, the 2022 NPRM provided factual findings with respect to health care accessibility in the United States based upon health care capacity by providers, population demands, and geographic limitations. 87 FR 47840. A detailed discussion about these considerations can be found in the Regulatory Impact Analysis. In addition, OCR seeks to ensure Federal civil rights protections are fulfilled and has consulted with the appropriate staff regarding the application of religious freedom and conscience protections during this rulemaking and will continue to engage such staff during OCR’s enforcement of the final rule. Comment: Many commenters inquired about OCR’s timeline for reaching a determination on a recipient’s request. Specifically, commenters objected to the language in proposed § 92.302(c) that provides that, ‘‘OCR may determine at any time whether a recipient is exempt from the application of certain provisions of this part’’ because, in their view, this leaves open-ended the start and end points of the process. Some commenters opined that this uncertainty could result in disruptions or inappropriate denials of care while a recipient awaits a determination. Other commenters suggested that OCR amend § 92.302(c) to clarify what is intended by the clause ‘‘may determine at any time’’ because it may conflict with the provision in § 92.302(b) that such determinations will be made ‘‘promptly.’’ Many commenters recommended that OCR publish the anticipated timeframe for OCR’s review of exemption requests, notify the requesting individuals/ organizations about when OCR anticipates their review will be E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations complete, and instruct the requesting individual/organization to notify patients if they will not be offering the service or treatment under review during that period. Commenters expressed the need to set a reasonable timetable to ensure that requests for exemptions are processed quickly to not impede or delay patient care. Some commenters also proposed that OCR publicize de-identified data on conscience claims and their respective review timelines to ensure public and private entities can monitor any access issues, should they occur. Many commenters who opposed the process described in § 92.302 explained that the provision lacks the guidance or clarity necessary for recipients to comply. For example, several commenters noted that in proposed § 92.302(a), OCR merely invites health care entities to express their views on whether their Federal religious freedom and conscience rights would be violated but provides no information about when a response should be expected. Some commenters explained that proposed § 92.302(b) appears to contemplate that recipients would wait until they are investigated or subject to an enforcement action before notifying OCR of their view that Federal religious freedom and conscience laws protect them. According to commenters, as proposed, § 92.302 provides no incentive for recipients to notify OCR any earlier than that, since the subsection appears to impose no obligation on OCR to weigh the notification or request until such an investigation or enforcement action is live. Other commenters pointed to the purported lack of guidance regarding the types of records and facts that would assist OCR in reaching a determination on the exemption request. Some commenters asserted that § 92.302(c) also does not explain how OCR will make final determinations and omits discussion of a recipient’s potential recourse for appeal in the event of an adverse decision from OCR. Response: OCR appreciates commenters’ suggestions and concerns and understands the desire for additional clarity and an established timeline under which OCR will process requests for assurances of exemptions and notify recipients of any determination. We agree that there is value in providing more detail regarding what obligations OCR and recipients have during this process, and so have revised § 92.302. These revisions provide, among other things: (1) a general application provision stating that a recipient may rely on applicable VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Federal protections for religious freedom and conscience; (2) clarity on what a notification for an assurance of a conscience or religious freedom exemption must contain; (3) a temporary exemption that will take effect upon the recipient’s submission of the notification, regardless of whether the recipient is being investigated, and that will remain valid during the pendency of OCR’s review of the request and any administrative appeal; (4) a general timetable under which OCR will acknowledge and begin to evaluate requests for assurances of exemptions; (5) additional clarity with regard to the scope of an exemption that has been assured under § 92.302(d); and (6) an administrative appeal process for recipients receiving adverse determinations. First, § 92.302(a) now provides that a recipient may rely on applicable Federal protections for religious freedom and conscience, and application of a particular provision(s) of this part to specific contexts, procedures, or health care services, shall not be required, and does not violate section 1557 if it so relies. Second, § 92.302(b) now provides that a recipient may notify OCR of its view that it is exempt from certain provisions of this part due to the application of Federal protections for religious freedom and conscience and seek assurance of that exemption. This notification must be in writing directed to the OCR Director and the notification must include (1) the particular provision(s) of this part to which the recipient objects; (2) the legal basis supporting the assurance of exemption request, including the standards governing the applicable conscience or religious freedom law; and (3) the factual basis supporting the recipient’s view that it is exempt, including identification of the conflict between the recipient’s conscience or religious beliefs and the application of a provision in this part, which may include the specific contexts, procedures, or health care services that the recipient asserts will violate their conscience or religious beliefs overall. Third, § 92.302(c) now provides that a recipient’s notification and request for an assurance of an exemption to OCR will trigger the extension of a temporary exemption to the recipient. This exemption will cover the period of time it takes OCR to reach a determination on the request. The temporary exemption shall apply only to the provision(s) as applied to specific contexts, procedures, or health care services identified in the recipient’s notification to OCR and will exempt conduct that occurs during the PO 00000 Frm 00139 Fmt 4701 Sfmt 4700 37659 pendency of OCR’s review and determination regarding the assurance of exemption request. In the event that there is an investigation or enforcement activity regarding the recipient related to the specific provisions for which an assurance of exemption has been requested, the temporary exemption will serve as a defense through the investigation or until OCR has made a determination on the assurance of exemption request, or through the administrative process if the recipient seeks an appeal under § 92.302(e). During this time, a recipient’s temporary exemption shall remain effective. OCR will work promptly to reach a determination regarding the request. Fourth, with respect to OCR’s expected timetable for review, § 92.302(c) now provides that for preenforcement requests for an assurance of an exemption, OCR shall provide the recipient with email confirmation within 30 days of a recipient’s notification acknowledging receipt of their request and stating that OCR will work expeditiously to reach a determination. If the request for an assurance of religious freedom and conscience exemption is received during the pendency of an investigation, it shall serve as a defense to the relevant investigation or enforcement activity until the final determination of the recipient’s request, the conclusion of the investigation, and any relevant appeal. The temporary exemption shall exempt the recipient from the provision of care at issue in the investigation until a final determination is made on recipient’s notification request or investigation, or during the pendency of any appeal. Fifth, OCR has revised § 92.302(d) to clarify the effect of an exemption. The assurance of an exemption would exempt the recipient from OCR’s administrative investigation and enforcement with regard to the application of a particular provision, which may include the specific contexts, procedures, or health care services that the recipient asserts will violate their conscience or religious beliefs. The exemption assurance will not apply to all contexts, procedures, or health care services. A recipient must otherwise have a legitimate, nondiscriminatory reason for denying or limiting service outside the scope of the granted exemption assurance, and any such decision must not be based on unlawful animus or bias, or constitute a pretext for discrimination. For example, a hospital with a religious exemption to not provide sterilizations outside of those permitted under their religious tenets may not rely on the exemption to broadly decline all health care services, E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37660 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations e.g., cancer treatments, to any individual if the hospital otherwise provides that care. Sixth, § 92.302(e) now clarifies that a recipient may appeal an OCR determination under this section. The relevant revisions provide that recipients subject to an adverse determination of their request for assurance of an exemption may appeal OCR’s determination of that request. Recipients who have been denied an exemption assurance under § 92.302 may raise their request before an administrative hearing examiner from the Department with the same procedural protections outlined for such administrative hearings under 45 CFR part 81. The temporary exemption granted under § 92.302(c) would remain in effect until completion of the administrative appeal process. Comment: Many commenters supportive of the outlined process also urged OCR to revise proposed § 92.302 to require OCR to make publicly available, or publish on its website, all determinations for any exemptions claimed or granted under § 92.302. A few commenters made specific suggestions for what the public postings should contain. These commenters proposed that postings should include the name(s) of the recipient requesting the exemption, the factual basis asserted by that recipient demonstrating its eligibility under Federal law, OCR’s analysis of those facts, and the specific provision(s) of the rule to which an exemption is recognized. A handful of other commenters raised the possibility of requiring exemption determinations to be published, within 10 days of issuance, in the Federal Register and on the Department’s website. Commenters also suggested that the notice should be accompanied by an electronic link to documents that specifically state the nature, scope, and duration of the exemption granted. Many commenters discussed that, in addition to promoting transparency, providing notice to the public of religious and conscience exemptions granted would provide guidance both to providers and patients regarding their rights and responsibilities under section 1557, reducing confusion that can impede equitable access to care, particularly for the vulnerable populations the rule is designed to protect. Many commenters stated that it is important that individuals seeking care or coverage know whether the health providers or issuers they are considering do, in fact, provide the services they need—including whether they will be presented with all available care options—and whether they will VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 feel accepted and welcomed by the provider they see. Response: OCR appreciates commenters’ suggestions for revisions to the rule to provide notice to the public regarding assurances of exemptions granted under this provision, including through having OCR post information regarding such assurances. Consistent with our title IX regulations and those of other agencies,389 OCR declines to revise § 92.302 to require affirmative notice of exemptions sought by or granted to recipients under this provision. OCR notes that nothing in this final rule prevents a recipient from providing public notice of any such exemption assurances it has sought or received and we encourage recipients to do so. We recognize that individuals are not always aware that the health care entities from which they seek care may be limited in the care they provide, and remain committed to working with recipients and the public to improve transparency, clarity, and access to health care through implementation of this rule. As noted above, OCR is also subject to FOIA, and information may be released to a requestor or made available for public inspection consistent with the agency’s obligations under that statute and its implementing regulations. Comment: Some commenters also criticized the process laid out in § 92.302 for failing to identify who will evaluate the exemption requests. One commenter stated that most recipients will likely wait to raise their religious defenses in litigation, as they see courts as the only neutral decisionmakers. A handful of commenters also raised concerns that the 2022 NPRM did not mention OCR’s 2019 final rule, Safeguarding the Rights of Conscience as Protected by Federal Statutes, 84 FR 23170 (May 21, 2019), or its applicability to numerous Federal statutes protecting religious freedom and conscience in health care. As a result of this omission, these commenters expressed skepticism about OCR’s ability to apply the regulatory provisions contained in that rule. Several commenters also questioned the interaction between the proposed exemption process and private rights of action. They stated that while the § 92.302 process would apply to OCR investigations and enforcement, the provision did not address situations where a lawsuit has been filed, as there is no across-the-board requirement that the administrative process be exhausted 389 See, e.g., 45 CFR 86.12 (no notice requirement); see, e.g., 34 CFR 106.12 (Department of Education, same). PO 00000 Frm 00140 Fmt 4701 Sfmt 4700 before going to court. Commenters assumed that faith-based hospitals likely will be forced to litigate claims in the courts without the ability to stay proceedings pending OCR’s consideration of their exemption claim—another factor, they argued, which undermined the usefulness of the proposal. Response: OCR appreciates commenters’ concerns regarding the process for review. OCR refers commenters to the six specific steps outlined above detailing what obligations OCR has, and what options are available to recipients. And as stated previously, OCR is committed to enforcing all Federal civil rights laws under its purview. While OCR appreciates comments regarding the 2019 Safeguarding the Rights of Conscience as Protected by Federal Statutes final rule, as a result of challenges to its legality, that rule has been vacated.390 OCR has published its final rule on enforcement of religious freedom and conscience laws. See Safeguarding the Rights of Conscience as Protected by Federal Statutes, 89 FR 2078 (Jan. 11, 2024). Finally, OCR would not open or continue an investigation under section 1557 against the recipient regarding compliance with a provision for which they have requested an exemption assurance while a temporary exemption under § 92.302(a) is in effect, or after a final determination is made that the recipient is entitled to an exemption. While such commenters are correct that a temporary or final assurance of an administrative exemption from OCR would not itself preclude any private lawsuit under section 1557, OCR notes that the recipient could still raise the relevant Federal conscience or religious freedom law as a possible defense in judicial proceedings in such private litigation. And in cases where OCR has assured the recipient an exemption under § 92.302, the recipient could argue that that assurance is evidence that a Federal religious freedom or conscience law likely applies to the recipient in any private litigation under this final rule. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the 390 New York v. HHS, 414 F. Supp. 3d 475, 580 (S.D.N.Y. 2019) (‘‘Accordingly, as a remedy, the Court vacates the 2019 Rule in its entirety, pursuant to [the Administrative Procedure Act] § 706(2).’’), appeal dismissed without prejudice to reinstatement, Nos. 19–4254 et al. (2d Cir.); see also Washington v. Azar, 426 F. Supp. 3d 704 (E.D. Wash. 2019), appeal pending, No. 20–35044 (9th Cir.); City & Cnty. of San Francisco v. Azar, 411 F. Supp. 3d 1001 (N.D. Cal. 2019), appeal pending, Nos. 20–15398 et al. (9th Cir.). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations comments received, we are finalizing the provision as proposed in § 92.302, with modifications. First, we are adding a § 92.302(a), which provide that a recipient may rely on applicable Federal protections for religious freedom and conscience, and consistent with § 92.3, application of a particular provision(s) of the part to specific contexts, procedures, or health care services shall not be required where such protections apply. Second, we are revising the process laid out in proposed § 92.302(b) through (d) as follows. We are revising § 92.302(b) to provide that a recipient that seeks assurance consistent with § 92.302(a) regarding the application of particular provision(s) of the part to specific contexts, procedures, or health care services may do so by submitting a notification in writing to the Director of OCR. Notification may be provided by the recipient at any time, including before an investigation is initiated or during the pendency of an investigation, and provides details on what must be submitted in writing to the OCR Director. We are revising § 92.302(c) to provide that a temporary exemption from administrative investigation and enforcement will take effect upon the recipient’s submission of the notification—regardless of whether the notification is sought before or during an investigation, and then delineates the scope and application of the temporary exemption. We are revising § 92.302(d) to provide that if OCR makes a determination to provide assurance of the recipient’s exemption from the application of certain provision(s) of the part or that modified application of certain provision(s) is required, the recipient will be considered exempt from OCR’s administrative investigation and enforcement with regard to the application of that provision as applied to the specific contexts, procedures, or health care services provided in the written determination. The determination does not otherwise limit the application of any other provision of the part to the recipient or to other contexts, procedures, or health care services. Third, we are adding § 92.302(e) to provide an administrative appeal process for recipients subject to an adverse determination of its request for an assurance of religious freedom and conscience exemption. Fourth, we are adding § 92.302(f) to provide that a determination under this section is not final for purposes of judicial review until after a final decision under 45 CFR part 81. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Procedures for Health Programs and Activities Conducted by Recipients and State Exchanges (§ 92.303) Section 92.303 proposed the enforcement procedures related to health programs and activities conducted by recipients and State Exchanges. In § 92.303(a), OCR proposed applying the procedural provisions in the title VI regulation with respect to administrative enforcement actions concerning discrimination on the basis of race, color, national origin, sex, and disability under section 1557. Proposed § 92.303(b) applied Age Act procedures to enforce section 1557 with respect to age discrimination complaints against recipients and State Exchanges. Proposed § 92.303(c) stated that when a recipient fails to provide OCR with requested information in a timely, complete, and accurate manner, OCR may, after attempting to reach a voluntary resolution, find noncompliance with section 1557 and initiate the appropriate enforcement procedure, found at 45 CFR 80.8. The comments and our responses regarding § 92.303 are set forth below. Comment: Many commenters recommended that § 92.303(a) explicitly recognize claims of discrimination involving multiple grounds, and suggested adding the language ‘‘or a combination thereof.’’ Response: As discussed in § 92.101, OCR agrees with this recommendation and we have added ‘‘or any combination thereof’’ throughout the regulatory text. Comment: Commenters generally supported adoption of title VI procedural provisions with respect to administrative enforcement actions; however, they noted that OCR proposed to process complaints alleging discrimination on the basis of age differently given the adoption of Age Act regulation requirements under § 92.303(b). These commenters recommended that OCR clarify that for administrative enforcement, it will treat claims involving multiple bases, such as age and other protected identities, under the same procedural provisions as title VI. Response: The Proposed Rule followed the 2016 Rule’s approach to administrative enforcement procedures for complaints on the basis of race, color, national origin, sex, and disability, applying the procedures found in the title VI regulation. The Proposed Rule proposed to apply the Age Act regulatory procedures to agebased complaints. The Age Act procedures uniquely contain a requirement that the Department refer PO 00000 Frm 00141 Fmt 4701 Sfmt 4700 37661 all sufficient complaints to mediation upon receipt; unresolved complaints will be returned to the Department. 45 CFR 91.43. The timeline for mediation is generally 60 days, unless a resolution is reached sooner, or the mediator has extended the time period for no more than 30 days. Id. at § 91.43(e). The 60day period counts as part of the 180 days the Department has to resolve a complaint before a court action can be filed by the complainant. 47 FR 57850, 57856 (Dec. 28, 1982). The mediation requirement derives entirely from the HHS Age Act regulations. The Age Act statute does not itself mandate referral for mediation. It merely directs agencies to publish regulations that ‘‘provide appropriate investigative, conciliation, and enforcement procedures.’’ 42 U.S.C. 6104(a)(4). In adopting the mediation requirement, the Department stated that the Age Act regulations offered ‘‘a unique opportunity to try [the] innovative approach’’ to resolution of complaints and committed to monitoring the effectiveness of the mediation process. 47 FR 57850, 57856 (Dec. 28, 1982). According to the Department’s 2021 Age Act Report, the Department referred 32 complaints for mediation, and two were successfully mediated (6 percent).391 Eight of 21 (38 percent) cases were successfully mediated in 2020, and eight of 48 (17 percent) were successfully mediated in 2019.392 Thus, the average success rate of mediation for complaints alleging age discrimination is roughly 18 percent. When a complaint is returned to the Department, it follows the title VI procedural provisions for investigations and enforcement. 45 CFR 91.47. We agree that individuals filing complaints with OCR under any of the bases for discrimination, including on the basis of age, should not be subject to unnecessary administrative hurdles. Given that the Age Act mediation requirement is not required by statute, but rather was an ‘‘innovative’’ approach adopted by the Department under its administrative authority to implement the Age Act, we have determined that OCR has the authority to not import such a requirement into the section 1557 procedures. While 391 Annual Report to Congress on Implementation of the Age Discrimination Act of 1975—Fiscal Year 2021, p. 32, https://www.hhs.gov/sites/default/files/ age-act-2021-report.pdf. 392 Annual Report to Congress on Implementation of the Age Discrimination Act of 1975—Fiscal Year 2019, p. 30, https://www.hhs.gov/sites/default/files/ age-act-2019-report.pdf; Annual Report to Congress on Implementation of the Age Discrimination Act of 1975—Fiscal Year 2020, p. 32, https:// www.hhs.gov/sites/default/files/age-act-2020report.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37662 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations mediation may prove beneficial under certain circumstances, as reflected through the Department’s reporting on Age Act enforcement, it is not successful in all cases. Given concerns raised by commenters, the value OCR places on the efficient and timely resolution of complaints, and the potentially sensitive nature of complaints raised under section 1557, we revisited the proposal to require complainants to engage in mandatory mediation. After review, and in light of these considerations and a desire for consistency across section 1557 administrative enforcement, we are revising the regulatory text to strike proposed § 92.303(b), which would have applied the Age Act procedural provisions to administrative enforcement actions concerning age discrimination. We are also revising § 92.303(a) to apply the title VI procedures to all administrative enforcement actions brought under section 1557. This means that a complaint filed under section 1557 alleging age discrimination would not require the complainant to engage in mediation before OCR can open an investigation and claims alleging multiple bases of discrimination would be subject to the same enforcement procedures under the final rule. We note that complainants that wish to engage in mediation to address a complaint against a recipient or State Exchange will be provided with the option to do so, as these complaints may also be addressed under the Age Act, consistent with 45 CFR 91.43. Comment: Commenters suggested making the OCR complaint process more straightforward and accessible, especially since individual complaints remain the primary trigger for investigations and individuals often file without legal representation. Commenters suggested that the final rule offer clear, fully accessible complaint mechanisms, including directions written in plain language, for filing discrimination complaints. These commenters suggested that complainants should not be required to parse out how a covered entity perceived them or responded to differing aspects of their lives. Further, these commenters recommended that any complaint procedures include resource materials such as Frequently Asked Questions, process diagrams, and materials presented in alternative formats, including videos with instructions in ASL embedded into the website as well as a clear and simple complaint process for individuals with LEP. One commenter further suggested VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 that OCR clarify in the final rule that citizenship status is not relevant to an enforcement process or complaint filing. One commenter also recommended that the time allowed for filing a complaint without needing to show good cause be extended from 180 days to 6 years to account for the postpartum timeline. Another commenter urged OCR to consider putting the longest deadline on the complaint filing that it can, consistent with its statutory obligations. This commenter noted that it often takes people months to realize they have been discriminated against, decide to do something about that discrimination, and find out that there are laws against the discrimination and agencies like OCR where they can file complaints. Response: OCR appreciates the comments regarding the complaint process. We understand the complaint filing process may be both perceived and experienced as challenging, and OCR welcomes suggestions on making the process more accessible. We currently offer resources on our website to provide the public with information about the process for submitting a complaint and what to expect once they have submitted a complaint to OCR.393 In addition, OCR revises its own processes, as needed. The most recent updates to OCR’s Civil Rights Discrimination Complaint Form and Portal, for example, include providing the form and portal in fifteen languages other than English, and inclusion of additional clarity regarding forms of discrimination to report, including sexual orientation, gender identity, pregnancy, and discrimination against individuals with LEP.394 We consider changes to the OCR complaint process on an ongoing basis as we strive to simplify the process and make it more accessible to all. OCR notes that the requirement that a complaint be filed no later than 180 days from the alleged discrimination is consistent with the enforcement mechanisms under title VI, which we adopt herein and have also been adopted under title IX, section 504, and 393 U.S. Dep’t Health & Hum. Servs., Off. for Civil Rts., Filing a Civil Rights Complaint, https:// www.hhs.gov/civil-rights/filing-a-complaint/ index.html. 394 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Complaint Portal, https:// ocrportal.hhs.gov/ocr/cp/complaint_frontpage.jsf; U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Get Help in Other Languages, https:// www.hhs.gov/ocr/get-help-in-other-languages/ index.html; U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Office for Civil Rights, Civil Rights and Conscience Complaint form (Expiration Date: Dec. 31, 2025), https://www.hhs.gov/sites/default/ files/ocr-cr-complaint-form-package.pdf. PO 00000 Frm 00142 Fmt 4701 Sfmt 4700 the Age Act. OCR will continue to extend the 180-day filing deadline for good cause, as outlined in the title VI regulation at 45 CFR 80.7(b). Further, to make this information more widely available, we are reinstating a required Notice of Nondiscrimination (§ 92.10), which includes information on how to file a complaint with OCR should an individual believe they were discriminated against. In response to the comments received, OCR also notes that citizenship status is not relevant to an enforcement process or complaint filing; an individual’s citizenship or immigration status does not prevent or alter their ability to file a complaint or OCR’s ability to enforce potential violations. Comment: Some commenters indicated that OCR should initiate compliance reviews rather than wait on individual complaints and some noted that while a simple, accessible complaint system is helpful, it should not, and cannot be, the only means of enforcement. Commenters stated that robust enforcement must include agency-initiated oversight, monitoring, and investigations; and that OCR should proactively review medical providers’ treatment of patients of color for patterns to help detect bias. A few commenters stated that incorporating the title VI procedures in proposed § 92.303(a) means including requirements that covered entities submit compliance reports and data to OCR and authorizing OCR to conduct periodic compliance reviews of covered entities. These commenters argued that OCR is effectively declaring that its enforcement of these provisions will be based on the presumption that any business decision made by a covered entity is either intentionally discriminatory or has an impermissibly discriminatory effect, unless and until that entity can demonstrate otherwise to OCR’s satisfaction. According to the commenters, this would have the effect of imposing an expansive, arbitrary, and capricious new regulatory regime. Response: OCR appreciates the importance of compliance reviews and robust enforcement. While most OCR investigations are conducted based on complaints received, OCR also conducts compliance reviews, which may be based on, for example, news reports or other information received by OCR.395 395 For example, on March 7, 2023, OCR announced that it had reached a Voluntary Resolution Agreement with Hillsborough County Fire and Rescue in Florida to improve access to care for communities of color. OCR initiated a compliance review of Hillsborough County Right and Rescue in response to public press reports indicating that its paramedics refused to transport E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 OCR disagrees with commenters’ position that adopting the longstanding enforcement procedures of title VI creates a presumption that a covered entity is discriminating. Nor does the adoption of these procedures represent a new ‘‘regulatory regime,’’ as these procedures appear in the Department’s title VI regulations, which were originally published in 1964396 and have since been adopted in the Department’s title IX and section 504 regulations. Section 92.303, adopting 45 CFR 80.6 (Compliance information), includes standard requirements related to civil rights enforcement, including seeking cooperation from recipients and State Exchanges in obtaining compliance; providing assistance and guidance to assist recipients and State Exchanges reach voluntary compliance; requiring records maintenance by recipients and State Exchanges so that they may demonstrate compliance with the conditions of their receipt of Federal funds; requiring access to pertinent records as needed to determine compliance; and sharing information with the public regarding protections against discrimination. As with all of its investigations, including compliance reviews, OCR acts as a neutral factfinder and does not presume discrimination by the covered entity. Comment: Some commenters recommended that OCR consider creating a searchable database of complaints and provide status updates that clearly indicate where in the process a complaint stands. Commenters also noted that OCR should shorten the time between filing a complaint and resolution. They noted that lengthy timelines for resolution have been detrimental, as advocates are an African American woman to the hospital because they assumed she could not afford the ambulance cost due to her race. See U.S. Dep’t Health & Hum. Services, Off. for Civil Rts., HHS Office for Civil Rights Reaches Agreement with Hillsborough County Fire and Rescue in Florida to Improve Access to Care for Communities of Color, https://www.hhs.gov/about/news/2023/03/07/hhsoffice-for-civil-rights-reaches-agreement-withhillsborough-county-fire-and-rescue-in-florida.html. In June of 2022, OCR entered into a Voluntary Resolution Agreement with the University of Southern California (U.S.C.) and Keck Medicine of U.S.C. (collectively, the ‘‘KMUSC Entities’’) resolving a compliance review of KMUSC Entities’ policies and procedures for responding to sex discrimination complaints made by students, employees, or patients employed by, or participating in, any KMUSC programs or activities receiving Federal financial assistance from HHS. See U.S. Dep’t Health & Hum. Servs., Off. for Civil Rts., HHS Voluntary Resolution Agreement with the University of Southern California Settles Title IX Compliance Review, https://www.hhs.gov/about/ news/2022/06/15/hhs-voluntary-resolutionagreement-with-university-of-southern-californiasettles-title-ix-discrimination-complaints.html. 396 29 FR 16298, 16301–03 (Dec. 4, 1964). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 reluctant to file knowing the duration of an investigation, and covered entities feel less urgency to comply. Some commenters noted that an ongoing deterrent to filing administrative complaints with OCR is the lack of a mandatory response deadline from OCR in title VI procedures. These commenters recommended implementing a 90-day deadline for OCR to resolve most section 1557 complaints, and a 120-day deadline for ‘‘more involved’’ section 1557 complaints. Response: OCR appreciates commenters’ recommendation to create a searchable database of complaints, and will take that under advisement, though we cannot commit to doing so at this time. OCR works with finite resources to address complaints as quickly and efficiently as possible and will continue to do so. Title VI procedures require a prompt investigation whenever information indicates possible noncompliance. OCR intends to follow these enforcement procedures and promptly address and resolve outstanding compliance failures. Because each potentially discriminatory action involves unique facts and circumstances that must be independently investigated on a caseby-case basis before OCR can determine whether a challenged action is considered discriminatory, we decline to add a mandatory response deadline as requested by commenters. Comment: One commenter recommended that OCR create a separate portal for complaints related to obstetric violence and obstetric racism. Response: OCR currently uses one portal for all civil rights complaints. The portal allows complainants to select the ground(s) under which they believe they were discriminated against to help ensure their complaints are fully reviewed and considered by OCR. Comment: Some commenters suggested merging proposed §§ 92.303 and 92.304 to help reduce confusion among complainants. Response: While we appreciate the need to have clarity when filing complaints, maintaining two separate sections is necessary given that there are different procedures for OCR to follow depending on whether the complaint is against the Department itself, or a recipient or State Exchange. However, for the sake of additional clarity, OCR will revise § 92.303(a) to parallel § 92.304, Comment: Some commenters recommended OCR include a provision in § 92.303 expressly stating that if OCR does not have jurisdiction over a PO 00000 Frm 00143 Fmt 4701 Sfmt 4700 37663 complaint, it will refer it to the appropriate office or agency. Response: Section 92.304 adopts the compliance procedures found in OCR’s federally conducted section 504 implementing regulation, which includes a provision requiring OCR to make reasonable efforts to refer a complaint over which it does not have jurisdiction to the appropriate Federal Government agency. 45 CFR 85.61(e). There is no corresponding provision in the title VI procedures, which are adopted at § 92.303 and are applicable to recipients and State Exchanges. However, OCR’s practice is to refer such complaints, and we believe this is important to reflect this in regulatory text. We have included a new provision, replacing the former age-discrimination related provision at proposed § 92.303(b), that reads: ‘‘If OCR receives a complaint over which it does not have jurisdiction, it shall promptly notify the complainant and shall make reasonable efforts to refer the complaint to the appropriate Federal Government entity.’’ A Comment: Some commenters recommended that any enforcement mechanism include monitoring, reporting, and ‘‘actual penalties’’ or fines. Response: We appreciate the need for strong enforcement mechanisms to ensure compliance with section 1557. The enforcement mechanisms incorporated into the rule allow for investigations based on both complaints and OCR-initiated compliance reviews. Voluntary Resolution Agreements and Settlement Agreements resulting from investigations generally include a monitoring period and reporting requirement to ensure ongoing compliance. If a recipient or State Exchange does not come into voluntary compliance and is found in violation of section 1557, OCR can take compliance action by either initiating fund termination proceedings under 45 CFR 80.8 or by any other means authorized by law, including referral to DOJ for enforcement proceedings. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, we are finalizing the provisions as proposed in § 92.303, with modifications. We are revising § 92.303(a) to read ‘‘. . . administrative enforcement actions concerning discrimination on the basis of race, color, national origin, sex, age, disability, or any combination thereof . . .’’ This language applies the same procedural provisions to administrative enforcement actions under section 1557 E:\FR\FM\06MYR4.SGM 06MYR4 37664 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 regardless of the basis of alleged discrimination, acknowledges that discrimination experienced by individuals may involve multiple bases, and corrects a scrivener’s error (an unnecessary placement of the word ‘‘discrimination’’ after ‘‘disability’’). We are also revising § 92.303(a) to parallel § 92.304, to now provide that the procedural provisions applicable to title VI apply with respect to administrative enforcement actions against health programs and activities of recipients and State Exchanges concerning discrimination on the basis of race, color, national origin, sex, age, and disability discrimination under section 1557 or the part. These procedures are found at 45 CFR 80.6 through 80.11 and part 81 of the subchapter. Additionally, we are replacing the text at proposed § 92.303(b) with new language stating: ‘‘If OCR receives a complaint over which it does not have jurisdiction, it shall promptly notify the complainant and shall make reasonable efforts to refer the complaint to the appropriate Federal Government entity.’’ Procedures for Health Programs and Activities Administered by the Department (§ 92.304) In § 92.304, OCR addressed procedures for all claims of discrimination against the Department under section 1557 or the part, as set forth in § 92.304(a). Section 92.304(b) proposed making the existing procedures under the section 504 federally conducted regulation at 45 CFR 85.61 and 85.62 applicable to all such claims under Section 1557 for all protected bases (i.e., race, color, national origin, sex, age, and disability). Section 92.304(c) proposed requiring the Department to provide OCR access to information relevant to determining compliance with section 1557 or the part. Section 92.304(d) proposed prohibiting the Department from retaliating against an individual or entity for the purpose of interfering with any right secured by section 1557 or the part, or because such individual or entity has participated in an investigation, proceeding, or hearing under section 1557 or the part. The comments and our responses regarding § 92.304 are set forth below. Comment: Some commenters recommended that this section explicitly recognize claims of discrimination involving multiple bases, and suggested amending § 92.304(a) to add ‘‘or a combination thereof.’’ Some commenters recommended providing clear procedures for the administrative VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 enforcement of such intersectional claims. Response: OCR agrees that including this language is consistent with the changes we have made throughout the text regarding claims of discrimination involving multiple bases and accepts this proposal with a minor modification, so that the rule reads ‘‘of any combination thereof.’’ Further, OCR appreciates the recommendation for providing clear procedures for the administrative enforcement of intersectional claims. As stated in § 92.301, administrative complaints under section 1557 alleging multiple grounds of discrimination are now subject to a single administrative process. Comment: Commenters on § 92.304(d) supported its prohibition on retaliation by the Department, noting that this provision shows a commitment to preventing discrimination at all levels and ensuring a path to rectifying grievances. Response: OCR appreciates the support for this provision and, as stated in the preamble, we think it is important to include because individuals should not face retaliation for asserting their civil rights or raising concerns regarding discrimination being experienced by others. Comment: Some commenters encouraged OCR to be as proactive as possible in enforcing the regulations with respect to the Department’s programs. Response: OCR appreciates the need for proactive enforcement and proactive technical assistance. We will continue working with the Department components in providing technical assistance and assisting them in helping to resolve compliance issues with section 1557. Summary of Regulatory Changes For the reasons set forth in the Proposed Rule and considering the comments received, OCR is finalizing the provisions as proposed in § 92.304, with modification. We are revising § 92.304(a) and (b) to read ‘‘. . . discrimination on the basis of race, color, national origin, sex, age, disability, or any combination thereof . . . ,’’ consistent with edits made at §§ 92.101(a)(1), 92.207(a) and (b)(1) and (2), and 92.303(a). In addition, as noted above, for clarity, we are revising § 92.304(b) to parallel § 92.303 to now provide that the procedural provisions applicable to section 504 at 45 CFR 85.61 and 85.62 shall apply with respect to administrative enforcement actions against the Department, including Federally-facilitated Exchanges, PO 00000 Frm 00144 Fmt 4701 Sfmt 4700 concerning discrimination on the basis of race, color, national origin, sex, age, or disability under section 1557 or the part. Also, where the section crossreferences regulatory provisions that use the term ‘‘handicap,’’ the term ‘‘race, color, national origin, sex, age, or disability’’ shall apply in its place. III. Change in Interpretation—Medicare Part B Funding Meets the Definition of Federal Financial Assistance; Responses to Public Comment The Department’s longstanding position has been that Medicare Part B (‘‘Part B’’) funding does not meet the definition of ‘‘Federal financial assistance’’ for the purpose of title VI, title IX, section 504, the Age Act, and section 1557. See, e.g., 81 FR 31375, 31383 (May 18, 2016). In the 2022 NPRM, we proposed to change that position after evaluating the Part B program and the definition of ‘‘Federal financial assistance’’, such that Part B funds will be considered Federal financial assistance when received by providers and suppliers. The Department sought comment on the impact that this change in position may have on recipients subsidized only by Part B funds that do not receive any other form of Federal financial assistance from the Department. We also invited comment on the amount of time that should be allowed for recipients of Part B funds to come into compliance with the applicable statutes and their implementing regulations. We also sought comment on what resources the Department can provide to assist newly covered entities in coming into compliance. The comments and our responses regarding this change in interpretation are set forth below. Comment: Some commenters objected to the proposal. These commenters claimed that interpreting Part B as meeting the definition of ‘‘Federal financial assistance’’ would reduce access to care because forcing these providers to implement new requirements will discourage them from participating in federally funded health care programs. Other commenters who opposed this interpretation stated that Part B does not meet the definition of ‘‘Federal financial assistance’’ because the program requires participants to pay monthly premiums based on income. In this way, commenters maintained, Part B is merely a private health insurance plan for individuals with low incomes, and is not equivalent to a Federal welfare program. A few commenters discussed that including Part B among the programs to which section 1557 applies is a radical change to what E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations qualifies as Federal financial assistance, and that such a change will affect other civil rights laws. Response: The Department’s change in interpretation regarding Part B does not alter, change, or expand the definition of ‘‘Federal financial assistance.’’ As stated in the 2022 NPRM, the Department is revising its position regarding whether Part B payments constitute Federal financial assistance under the longstanding definition of ‘‘Federal financial assistance’’ in regulations implementing section 1557 and the four statutes referenced in section 1557: title VI, title IX, section 504, and the Age Discrimination Act. 87 FR 47828. After evaluating the definition of ‘‘Federal financial assistance,’’ the Department has concluded that Part B funds meet that definition. While we disagree that this change in interpretation changes the definition of ‘‘Federal financial assistance,’’ we do note that this change means that Part B payments are considered Federal financial assistance with respect to title VI, title IX, section 504, and the Age Discrimination Act, in addition to section 1557. Moreover, the Department disagrees that Part B is the equivalent of private health insurance and therefore is not Federal financial assistance. Part B confers a benefit or subsidy on the recipient—namely, financial assistance to the provider in exchange for providing health care services. As discussed in the 2022 NPRM, ‘‘the government is assisting providers of services by making available to them a segment of the patient population that either (a) would not have been able to afford any medical services, or (b) would not have been able to afford these specific providers.’’ 87 FR 47890. The Federal Government, through Part B, offers providers a reliable source of payment for services given to eligible patients who otherwise would go without care. Although Part B enrollees may pay premiums to receive coverage, the Federal Government covers half of the cost of Part B benefits. Thus, the fact that enrollees may pay for a portion of their coverage does not change the fact that providers receive Federal financial assistance through the program. In this way, Part B is no different than Medicare Part A, which also offers financial assistance to providers and which has long been considered Federal financial assistance. We note, however, that private health insurance may be subject to this rule when a health insurance issuer receives Federal financial assistance for such coverage. For instance, issuers may receive Federal financial assistance through VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 receipt of advance payments of the premium tax credit or cost-sharing reductions for qualified health plans, which are private health insurance plans sold on the Exchanges. Further, when a recipient health insurance issuer is principally engaged in the provision or administration of health insurance coverage or other health-related coverage as set forth under the definition of ‘‘health program or activity’’ at § 92.4, all of the issuer’s operations are covered, including its other private health insurance coverage, such as coverage sold off the Exchange. OCR is also unpersuaded by the argument that the Department’s change in interpretation will reduce access to care by leading to physician disenrollment from Medicare participation or decreased participation in other federally funded government programs. Indeed, we are unaware of any evidence that supports this concern and commenters did not provide any. As stated in the 2022 NPRM, many providers who receive payments through Part B are already subject to section 1557 and the four civil rights laws referenced in section 1557 through receipt of other Federal financial assistance. 87 FR 47890. For the reasons provided in the NPRM and restated here, the Department respectfully disagrees with commenters and reiterates its position that funds provided via the current Part B program meet the longstanding definition of ‘‘Federal financial assistance’’. Comment: An overwhelming number of commenters supported the change in interpretation, the result of which is that the Part B funds will be considered Federal financial assistance. Many groups commented that applying section 1557 to Part B will help address past discrimination. For example, commenters discussed that excluding Part B from a Federal financial assistance designation exempted individual providers from any obligation to comply with the Civil Rights Act of 1964. This exemption of the Part B program from title VI’s nondiscrimination requirements allowed doctors in many states to continue providing segregated health care services. Commenters stated that failing to consider Part B payments as Federal financial assistance created confusion for patients about whether civil rights laws applied to their individual health providers—many of whom refused to serve individuals on the basis of their race or national origin because title VI did not apply to them. Therefore, commenters suggested that discriminatory history warrants the Department’s reassessment of whether PO 00000 Frm 00145 Fmt 4701 Sfmt 4700 37665 Part B payments meet the definition of ‘‘Federal financial assistance’’. They also note that this change will align Part B with other portions of the Medicare program and bring uniformity across all Medicare providers, increasing access to quality health care. Other commenters explained that many of Part B providers already receive other forms of Federal financial assistance, such that this change in interpretation will not subject them to new obligations. Some commenters stated that all providers enrolled in the Part B program are recipients of Federal financial assistance—regardless of whether they are ‘‘participating’’ or ‘‘non-participating’’ providers—because even those designated as ‘‘nonparticipating’’ agree to provide Medicare-subsidized health services to Part B enrollees. Many other supportive commenters noted that because funds received under Medicare Part A and Part B are fundamentally similar and Medicare Part A payments have long been considered Federal financial assistance, it is reasonable for the Department to similarly consider Part B payments as Federal financial assistance. Therefore, the commenters argue, considering Part B payments to be Federal financial assistance will allow individuals additional options for bringing discrimination claims against discriminatory conduct in all health care settings. Response: OCR appreciates commenters’ views on the Department’s change in interpretation regarding whether Part B payments constitute Federal financial assistance as defined by our civil rights regulations. The Department agrees with commenters that because Part B payments, like those of Medicare Part A, are Federal funds directly or indirectly received by providers, they squarely meet the definition of ‘‘Federal financial assistance’’. This position provides uniformity across the Medicare programs and will not only help address patient confusion regarding the funding streams of their respective Medicare programs, but also ensures that the Department is applying the definition of ‘‘Federal financial assistance’’ consistently across all of our federally funded programs. The Department agrees that because many recipients of Part B funds are already recipients of some other form of Federal financial assistance, this change will not impose excessive burdens on those covered entities. For those newly covered entities, however, we are providing a delayed applicability date as discussed below. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37666 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: Many other commenters expressed the view that this change in position by the Department reflects the evolution of how the Part B program operates today. Commenters explained that while Part B once served as contracts of insurance for those who qualified, today, individual providers directly bill and receive payment from the Federal Government itself. Response: The Department acknowledges commenters’ point that the current manner in which the Part B program is administered is a factor in our changed view on whether Part B funds meet the definition of ‘‘Federal financial assistance’’. As the commenters noted, a majority (2⁄3) of providers enrolled in Part B bill and are paid directly by the Medicare program. 87 FR 47889. However, this is not solely determinative regarding the change in interpretation. As noted in the 2022 NPRM, under Grove City College v. Bell, 465 U.S. 555, 569 (1984), Federal funds are Federal financial assistance regardless of whether they are provided directly by the Federal Government to an entity or are provided initially to beneficiaries (i.e., program participants) for the specified purpose of assisting with payment for services. Comment: Several commenters stated that this change in position will increase equity in access to quality health care for individuals with LEP, immigrants, and communities of color, as these groups are more likely to participate in Part B. Other commenters expressed the view that this interpretation allows the Department to align Part B providers’ nondiscrimination obligations to Medicare Part A, which will result in better care for individuals with disabilities and will eliminate confusion for older adults who cannot determine whether their Part B provider receives any other type of Federal financial assistance. Other commenters stated that this will offer significant relief for older patients, individuals with disabilities, and LGBTQI+ adults by providing the same protections and rights regardless of the nature of the Medicare provider or the service they are receiving. These patients will no longer have to determine whether they are eligible for both Medicare and Medicaid, or whether they have Medicare or Medicaid, in order to assess what nondiscrimination protections they are afforded. A few commenters expressed the view that this will be particularly helpful for enrollees who rely on small specialty providers for care, such as medical equipment suppliers, that receive only Part B and no other form of Federal financial VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 assistance. Several other commenters also explained that because many Medicare providers also serve people with other forms of health coverage, including private insurance, this change will increase access to quality health care for underserved communities who face disproportionate discrimination and barriers. Response: The Department appreciates these comments and generally agrees that bringing all Medicare programs in line with other Federal financial assistance programs will bring about better health outcomes and increase equity in access to care. This position is also supported by the similarities across the Medicare programs and eliminates an inconsistency in the application of the definition of ‘‘Federal financial assistance’’ that the Department has determined is no longer justifiable. Comment: A few commenters suggested that the Department should have a delayed date for when the revised interpretation regarding Part B payments as Federal financial assistance becomes effective. Some suggested at least 180 days and up to 365 days for newly covered providers to reach compliance for those practices that have not been subject to these requirements in the past. Several commenters stated that newly covered entities will need sufficient time to implement appropriate procedures, such as having a one-year applicability date or a safeharbor compliance window of at least 6 months. However, one commenter expressed that the Department should impose the same implementation timeline for all covered entities, given that, in their view, very few entities will be providers who are not already Federal financial assistance recipients. This commenter explained that additional time is not necessary because OCR is also providing entities with technical assistance to reach compliance. Response: The Department appreciates commenters’ concerns and has amended the applicability date to give newly covered recipients sufficient time to come into compliance with civil rights obligations, as described below in the ‘‘Summary of Changes.’’ As this new designation of Part B applies to all Federal financial assistance-based civil rights statutes enforced by the Department, to the extent covered entities require assistance, OCR will provide adequate support. Notice of Interpretation and Dates A. Notice of interpretation. The Department is finalizing its interpretation that Medicare Part B PO 00000 Frm 00146 Fmt 4701 Sfmt 4700 (‘‘Part B’’) funding meets the definition of ‘‘Federal financial assistance’’ for the purpose of title VI, title IX, section 504, the Age Act, and section 1557. B. Effective date. This interpretation is effective upon its publication in the Federal Register. C. Applicability date. The Department recognizes that that there are some recipients that do not receive any Federal financial assistance other than Part B funds and that these recipients be newly required to comply with section 1557 and other Federal civil rights laws enforced by OCR. The Department acknowledges that these recipients will require time to come into compliance as a result of this change in position. Therefore, while this revised interpretation is effective upon publication in the Federal Register, it will have a one-year delayed applicability date. Thus, compliance by entities whose Federal program participation has been limited to Part B must be in compliance with title VI, title IX, section 504, the Age Act, and section 1557 no later than May 6, 2025. An Assurance of Compliance, as required by 45 CFR 92.5, must be filed with the Department by entities whose Federal program participation has been limited to Medicare Part B no later than May 6, 2025. This can be completed via OCR’s Assurance of Compliance portal at https://ocrportal.hhs.gov/ocr/aoc/ instruction.jsf. Similarly, if such a recipient accepts a form of Federal financial assistance other than Part B prior to May 6, 2025, they will be required to complete an Assurance of Compliance at that time, consistent with section 1557 and the other Federal civil rights laws enforced by OCR. IV. CMS Amendments In the 2022 NPRM, the Department proposed clarifying CMS provisions that govern Medicaid and CHIP; PACE; health insurance issuers, including issuers providing EHB and issuers of qualified health plans (QHPs), and their officials, employees, agents, and representatives; States and the Exchanges carrying out Exchange requirements; and agents, brokers, or web-brokers that assist with or facilitate enrollment of qualified individuals, qualified employers, or qualified employees into Exchange coverage so that they again identify and recognize discrimination on the basis of sexual orientation and gender identity as prohibited forms of discrimination based on sex. The Department sought comments on CMS’ proposal to explicitly mention only gender identity and sexual orientation in its amendments, while understanding that E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations discrimination on the basis of sex stereotypes, sex characteristics, and pregnancy or related conditions is also prohibited sex discrimination. We are clarifying and emphasizing our intent that if any provision of this final rule is held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, or stayed pending further action, it shall be severable from this final rule, and from rules and regulations currently in effect, and not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other, dissimilar circumstances. Through this rule, we adopt provisions that are intended to and will operate independently of each other, even if each serves the same general purpose or policy goal. Where a provision is necessarily dependent on another, the context generally makes that clear. Comment: The majority of commenters on the proposed CMS amendments in the 2022 NPRM supported the proposal to explicitly identify and recognize discrimination on the basis of sexual orientation and gender identity as prohibited types of sex discrimination. However, many of the commenters noted that the language in the CMS amendments did not match the language explaining what constitutes sex discrimination in the proposed section 1557 implementing regulation (proposed 45 CFR 92.101(a)(2)). Commenters encouraged the agency to adopt the language in proposed § 92.101(a)(2). Specifically, those commenters suggested that the CMS amendments should revise the term ‘‘sex’’ to ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; transgender status; and sex stereotypes)’’ rather than ‘‘sex (including sexual orientation and gender identity)’’ as proposed for the various CMS regulations. Commenters argued that adopting the language from § 92.101(a)(2) in the CMS amendments would avoid confusion and ensure consistency of implementation and enforcement among the nondiscrimination protections in the CMS amendments and section 1557. In many contexts, CMS program regulations are more visible to some providers, patients, patient advocates, and other stakeholders than section 1557 requirements and are more readily translated into institutional policy, training, and patient awareness. Commenters asserted that the Department having a consistent description of sex discrimination would improve consistency across Department VerDate Sep<11>2014 22:57 May 03, 2024 Jkt 262001 regulations, further the health and safety of program beneficiaries, and protect them from discrimination in health care. One commenter emphasized that a statement in the 2022 NPRM that CMS understands that discrimination on the basis of sex stereotypes, sex characteristics, and pregnancy or related conditions is prohibited sex discrimination, without the inclusion of such language in the regulatory text, provides inadequate notice to entities required to comply with the CMS amendments. Response: The Department is finalizing the proposed amendments to the CMS regulations, with a revision to the description of sex discrimination to conform to the language in 45 CFR 92.101(a)(2). We appreciate that so many commenters made this suggestion and raised important issues concerning avoiding confusion, ensuring consistent implementation, and providing greater clarity for compliance and enforcement. In the Proposed Rule, CMS noted in the preamble that it understands that sex discrimination includes discrimination based on sex stereotypes, sex characteristics, including intersex traits, and pregnancy or related conditions, but limited the explicit mention in the regulatory text to gender identity and sexual orientation, sought comments. 87 FR 47891. The Department agrees with commenters that the amendments in the regulation should reflect CMS’ intended interpretation of sex discrimination to avoid confusion for regulated entities and to better address the barriers to obtaining health care, including those faced by LGBTQI+ people, that CMS noted in the Proposed Rule. As there are entities that must comply with both CMS nondiscrimination provisions and section 1557, adopting identical language will ensure consistency across the policies and requirements applicable to entities subject to all of the provisions. As finalized, these CMS regulations provide that discrimination based on ‘‘sex’’ includes discrimination based on sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. The list in the regulation text is not an exhaustive one that outlines all the ways (or the only ways) that discrimination can be based on sex but, rather, it only identifies examples; CMS interprets these regulations accordingly. However, nothing in this rule impedes regulated entities from taking nondiscriminatory actions based on current medical standards and evidence, such as individualized and nondiscriminatory decisions based on current medical PO 00000 Frm 00147 Fmt 4701 Sfmt 4700 37667 standards and evidence about the timing or type of protocols appropriate for care. The rule does not (and cannot) require a specific standard of care or course of treatment for any individual, minor or adult. Summaries of regulatory changes are outlined below, along with responses to comments. In the following sections, for brevity, all references to ‘‘sex discrimination’’ or ‘‘discrimination on the basis of sex’’ mean ‘‘discrimination based on sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity, including transgender status; and sex stereotypes).’’ A. Medicaid and Children’s Health Insurance Program (CHIP) In 42 CFR 438.3(d)(4) and 438.206(c)(2) (which apply to CHIP managed care through existing crossreferences in §§ 457.1201(d) and 457.1230(a)), we proposed to restore regulatory text to prohibit Medicaid and CHIP managed care plans, which include managed care organizations, prepaid inpatient health plans, prepaid ambulatory health plans, primary care case managers, and primary care case management entities in managed care programs, from discriminating on the basis of sexual orientation and gender identity, and to require managed care plans to promote access and delivery of services in a culturally competent manner to all beneficiaries regardless of sexual orientation or gender identity. Such text was finalized as part of §§ 438.3(d) and 438.206(c)(2) in the Medicaid and CHIP managed care final rule published in the Federal Register on May 6, 2016 (2016 Medicaid and CHIP Rule), 81 FR 27498, but was removed as part of the Department’s second section 1557 rulemaking (2020 Rule), 85 FR 37160, 37219–37220. Similarly, in 42 CFR 440.262, for feefor-service Medicaid programs, we proposed to restore regulatory text to require States to promote access and delivery of services in a culturally competent manner to all beneficiaries regardless of sex, including sexual orientation or gender identity. Again, the text was finalized as part of § 440.262 in the 2016 Medicaid and CHIP Rule but the references to sexual orientation and gender identity were removed by the 2020 Rule. We also proposed to change ‘‘unique’’ in 42 CFR 440.262 to ‘‘individualized’’ to more accurately reflect Medicaid’s goal of providing person-centered care. Finally, we proposed to incorporate 42 CFR 440.262 into CHIP regulations through a cross-reference at 42 CFR 457.495(e), E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37668 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ensuring alignment across fee-forservice Medicaid and CHIP programs. The comments received on these proposals and our responses are set forth below. Comment: We received many comments in support of the reinstatement of prohibitions against discrimination based on sexual orientation and gender identity in Medicaid and CHIP. Commenters stated that restoring the regulation text at 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 (and therefore in §§ 457.1201(d) and 457.1230(a)) would promote access to care and the delivery of services in a culturally competent manner, strengthen the Department’s commitment to increasing equity, and address discrimination in health programs and activities that can lead to disparate health outcomes. Response: We appreciate the support for our proposals and believe finalizing revisions to these provisions will be an essential step in promoting culturally competent care that improves access, quality of care, and ultimately health outcomes. Comment: One commenter that asked CMS to adopt the more detailed description of ‘‘sex discrimination’’ in proposed § 92.101(a)(2) pointed out that CMS program rules provide different compliance mechanisms—including prospective as well as complaint-based mechanisms—that complement section 1557’s fundamental but essentially retrospective, complaint-based enforcement scheme. Response: We appreciate the commenter raising this important perspective. There are prospective and retrospective compliance mechanisms reflected as State and managed care plan responsibilities in the Medicaid managed care regulations at 42 CFR part 438. Some provisions explicitly address requirements that must be included in managed care plan contracts and others stipulate State responsibilities. A provision that particularly reflects State responsibilities for proactively monitoring their managed care programs to ensure compliance with Federal regulations is 42 CFR 438.66, which requires States to have a monitoring system for all Medicaid managed care programs that addresses all aspects of the program including the performance of each managed care plan. This provision also requires States to use the data collected from their monitoring activities to improve their program’s performance. This example of a prospective and retrospective activity requirement demonstrates how the Medicaid managed care regulations may help states and their managed care VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 programs complement OCR’s enforcement actions related to the prohibition of discrimination by providing for more timely monitoring and enforcement of discrimination prohibitions. Consistent regulation text about what sex discrimination means in this context—specifically, it includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes—will maximize the effect of these benefits. In addition, we believe it is critical to ensure consistency in the application of nondiscrimination requirements between Medicaid managed care and fee-for-service programs. Under section 1902(a)(19) of the Social Security Act, states must provide for such safeguards as may be necessary to assure access to care and services in a manner consistent with simplicity of administration and the best interest of beneficiaries. A Medicaid fee-for-service regulation (at 42 CFR 440.262) clarifying the meaning of the term ‘‘sex’’ in this context, particularly when that regulation is consistent with 42 CFR 438.3(d)(4) and 438.206(c)(2) facilitates simplicity in administration of nondiscrimination requirements and ensures the best interests of the beneficiaries are met across Medicaid delivery systems for all Medicaid beneficiaries. As we noted in the NPRM, the best interest of beneficiaries is appropriately met when access to care and services are provided in a non-discriminatory manner. A consistent approach on this issue will help protect beneficiaries from discrimination, avoid confusion, and provide for simplicity in administration of State Medicaid programs. To this end, we believe the reference to ‘‘sex’’ at 42 CFR 440.262 should be consistent with 42 CFR 438.3(d)(4) and 438.206(c)(2). For this reason and those stated above, we are finalizing the proposed amendments to 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 with revisions to make the discussions of ‘‘sex’’ in them consistent with 45 CFR 92.101(a)(2). In 42 CFR 438.3(d)(4) (and therefore § 457.1201(d)), we also are finalizing revisions to improve the readability of the provision by replacing some of the commas with semicolons and moving ‘‘disability’’ after ‘‘national origin.’’ We have also removed unnecessary parentheses in 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262. Comment: One commenter asserted that the Department based the Proposed Rule on general provisions of the Social Security Act requiring that health assistance be provided in the ‘‘best interest of beneficiaries’’ (for Medicaid PO 00000 Frm 00148 Fmt 4701 Sfmt 4700 programs) and that the statute cited by the Department does not indicate Congressional intent related to prohibiting discrimination. Response: The Department undertook this rulemaking to better align the section 1557 regulation with the statutory text of 42 U.S.C. 18116, to reflect recent developments in civil rights case law, and to better address issues of discrimination that contribute to negative health interactions and outcomes. We believe aligning the Medicaid and CHIP regulations in 42 CFR parts 438, 440, and 457, subpart L, with the section 1557 regulations is critical to fulfilling the Department’s mission of pursuing health equity and protecting public health. Access to health care that is free from discrimination benefits all communities and people, and is also vital to addressing public health emergencies, such as the COVID–19 pandemic. CMS possesses statutory authority under section 1902(a)(4) of the SSA (codified at 42 U.S.C. 1396a(a)(4)), which authorizes the Secretary to adopt methods of administration necessary for the proper and efficient operation of the Medicaid State plan; section 1902(a)(19) of the SSA (codified at 42 U.S.C. 1396a(a)(19)), which requires the Medicaid State plan to provide safeguards as necessary to assure that covered services are provided in a manner consistent with the best interests of the recipients; and section 2101(a) of the SSA (codified at 42 U.S.C. 1397aa(a)), which permits provision of funds to States to enable them to initiate and expand the provision of child health assistance to uninsured, low income children in an effective and efficient manner. CMS interprets section 1902(a)(19) of the SSA as prohibiting discrimination in the delivery of services because such discrimination is inconsistent with the best interests of the Medicaid beneficiaries who are eligible for and receive services. CMS interprets sections 1902(a)(4) and 2101(a) of the SSA as authorizing CMS to adopt regulations prohibiting discrimination on the basis of sex because such prohibitions on discrimination are necessary for the proper and efficient operation of a State plan, are in the best interest of beneficiaries, and enable states to provide child health assistance in an effective and efficient manner. For these reasons, we disagree with the commenter and continue to assert that adopting protection against discrimination to address disparities and, ultimately, health outcomes is within the authority granted to CMS by the Act. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Comment: One commenter stated that the proposed regulation text would prohibit physicians or other health professionals from categorically declining to provide gender-affirming treatments due to their religious or moral beliefs guaranteed them under the First Amendment to the U.S. Constitution and could require them to provide services and treatment procedures related to gender-affirming care that they object to performing. Response: These regulations do not require the provision of any specific services. These regulations are neutral, generally applicable, and do not violate the Free Exercise Clause of the First Amendment. These regulations do not target religiously motivated conduct, but rather, are intended to prohibit sex discrimination generally in order to improve health outcomes for the LGBTQI+ community and fulfill the statutory command of the ACA to prohibit discrimination and remove unreasonable barriers to care. As noted previously in this rule, conduct does not constitute a violation of this rule’s prohibition on sex discrimination if there is a legitimate, nondiscriminatory reason for the action. Also, HHS will respect religious freedom and conscience protections in Federal law, particularly with regard to the provision of certain health-related services. For example, when enforcing its nondiscrimination regulations, HHS will comply with laws protecting the exercise of conscience and religion, including RFRA (42 U.S.C. 2000bb through 2000bb–4) and all other applicable legal requirements. Nothing in the nondiscrimination protections at 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 (which apply to CHIP managed care through existing cross-references in §§ 457.1201(d) and 457.1230(a) and CHIP fee-for-service through a new cross-reference at § 457.495(e)), displaces those protections. In enforcing the nondiscrimination provisions in the corresponding CMS regulations, the Department will comply with laws protecting the exercise of conscience and religion, including the Religious Freedom Restoration Act (42 U.S.C. 2000bb through 2000bb–4) and all other applicable legal requirements. Finally, we note that physician licensing and discipline are outside the scope of this rulemaking. Summary of Regulatory Changes After consideration of the public comments, we are finalizing 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 (which apply to CHIP managed care through existing cross-references in §§ 457.1201(d) and 457.1230(a)) with VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 revisions to specify that discrimination based on ‘‘sex’’ includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. Similarly, where these regulations require actions to be taken regardless of sex, that includes actions regardless of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. We are also finalizing the change of ‘‘unique’’ to ‘‘individualized’’ in 42 CFR 440.262 as proposed. B. Programs of All-Inclusive Care for the Elderly (PACE) In 42 CFR 460.98(b)(3), CMS proposed to add sexual orientation and gender identity to the list of characteristics that may not serve as a basis for discrimination against a PACE participant. Additionally, in 42 CFR 460.112, we proposed to add gender identity to the list of characteristics that may not serve as a basis for discrimination against a PACE participant. This PACE provision is applicable one year after the effective date of this final rule. Comment: CMS received numerous comments supporting our changes to both provisions. Response: CMS thanks the commenters for supporting these important changes that will serve to protect CMS’ beneficiaries. Comment: Several commenters did not support CMS’ proposal to add sexual orientation and gender identity to the list of characteristics that may not serve as a basis for discrimination against a PACE participant. Some commenters objected to the protections against discrimination on the basis of gender identity, in particular. Some commenters, believing that the proposal requires coverage of gender-affirming care, stated that the Department can adequately protect people from discrimination without mandating this coverage. Response: This rule does not require entities to cover any particular procedure or treatment. We clarify that, in finalizing the prohibition against discrimination on the basis of sex, the Department is not mandating that PACE organizations include coverage for any particular item or service not already covered. Rather, amending these sections to clarify discrimination on the basis of sex as including sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes will better ensure that all PO 00000 Frm 00149 Fmt 4701 Sfmt 4700 37669 individuals are treated fairly in their access to health care. Without protection from such sex discrimination, transgender individuals may face barriers or be denied medically necessary services that are classified as covered under PACE and made available to other enrolled individuals. These amendments will better clarify nondiscrimination protections for all individuals, while also addressing existing disparities for LGBTQI+ individuals seeking health care. For the reasons discussed here and in the preamble to the Proposed Rule, CMS believes it is important to ensure all PACE participants are protected against unlawful discrimination of any kind, including discrimination based on sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. Therefore, we are finalizing these revisions. Summary of Regulatory Changes We are finalizing the regulatory language with modifications based on comments received. Specifically, we are revising the reference to sex to include additional detail explaining that the reference to ‘‘sex’’ includes sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity, including transgender status; and sex stereotypes. C. Insurance Exchanges and Group and Individual Health Insurance Markets In the HHS Notice of Benefit and Payment Parameters for 2023 Proposed Rule (2023 Payment Notice NPRM),397 the Department proposed amendments to the regulations applicable to Exchanges, QHPs, and certain issuers to prohibit discrimination based on sexual orientation and gender identity. The amendments were similar to those proposed in the 2022 NPRM. Those proposed amendments were not finalized in the Notice of Benefit and Payment Parameters for 2023 final rule published on May 6, 2022,398 because the Department determined that it would be most prudent to address the nondiscrimination proposals related to sexual orientation and gender identity in the 2022 NPRM to ensure consistency across the policies and requirements applicable to entities subject to both 397 U.S. Dep’t of Health & Hum. Servs. Ctrs. for Medicare & Medicaid Servs., Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2023, 87 FR 584 (January 5, 2022). 398 U.S. Dep’t of Health & Hum. Servs. Ctrs. for Medicare & Medicaid Servs., Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2023, 87 FR 27208 (May 6, 2022). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37670 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations those amendments and section 1557. 87 FR 27208. The clarifications finalized in this section of the rule will apply on or after the effective date of this final rule (60 days after publication). In finalizing amendments to the CMS regulations in this final rule, the Department considered comments received in response to the 2022 NPRM, as well as comments received to similar proposals in the 2023 Payment Notice NPRM (collectively, the ‘‘Proposed Rules’’). The Department is also responding to comments we received in response to the Proposed Rules in this final rule. In section C.1. of this preamble, the Department responds to comments applicable to 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b). Section C.2. provides a summary of regulatory changes for 45 CFR 155.120(c), 155.220(j), 156.200(e), and 156.1230(b); there were no unique comments applicable to those sections. Comments that relate specifically to 45 CFR 147.104 are addressed in section C.3. of this preamble. As stated in the 2022 NPRM, if any of the provisions at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) are held to be invalid or unenforceable by their terms, or as applied to any person or circumstance, such provision shall be considered severable from its respective section or such application shall be considered severable from any valid or enforceable applications of such provision (87 FR 47895). The determination that a provision is invalid or unenforceable shall not affect either the remainder of its section or any other sections, and the determination that a provision is invalid or unenforceable as applied to any particular person or circumstance shall not affect the application of the provision to other persons not similarly situated or to other dissimilar circumstances. In enforcing the nondiscrimination provisions in the corresponding CMS regulations, the Department will comply with laws protecting the exercise of conscience and religion, including, to the extent applicable, section 1303 of the ACA, the Weldon, Church, and Coats-Snowe amendments, the Religious Freedom Restoration Act (42 U.S.C. 2000bb through 2000bb-4) and all other applicable legal requirements. 1. Comments and Responses to 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) The Department proposed to amend 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) by removing the term ‘‘sex’’ VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 and revising the term to read ‘‘sex (including sexual orientation and gender identity).’’ However, after considering all the public comments submitted in response to the Proposed Rules, the Department is finalizing a revision to the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ This revision is necessary to ensure consistency across the policies and requirements applicable to entities subject to both those amendments and section 1557. Comment: The majority of commenters to the proposal in the 2023 Payment Notice NPRM expressed broad support for the proposal and agreed that amending the CMS regulations is warranted in light of the welldocumented discrimination that LGBTQI+ individuals face in seeking health care and insurance coverage. Commenters supporting the proposal asserted that all Americans deserve access to affordable, high-quality health care, and that Federal policies and nondiscrimination protections must reinforce equity of care for all patients regardless of socioeconomic and sociodemographic characteristics and insurance coverage. Commenters urged the Department to finalize the proposed nondiscrimination protections in light of persisting trends of pervasive discrimination in insurance coverage. Commenters said that it is well documented that LGBTQI+ individuals continue to face discrimination in seeking health care, and that the nondiscrimination protections will help address barriers to health equity for LGBTQI+ individuals and aid providers in providing effective care. Many commenters supporting the proposal referred to copious bodies of research, including research identified in the 2022 NPRM, that demonstrate the many ways in which the LGBTQI+ community faces discrimination when seeking health care, resulting in poorer health outcomes. 87 FR 47833–47835 (2022). Commenters asserted that issuers have contributed to this discrimination by employing transgender-specific exclusions to deny coverage for medically necessary treatment and that this was exacerbated by the removal of protections on the basis of sexual orientation and gender identity in the 2020 Rule. Many of these commenters also highlighted how individuals who identify as part of the LGBTQI+ community disproportionately face health PO 00000 Frm 00150 Fmt 4701 Sfmt 4700 disparities and are at higher risk for many conditions. Response: We firmly believe that clarifying the scope of sex discrimination can lead to improved health outcomes for LGBTQI+ individuals 399 and that these protections are consistent with our broader aim of improving health equity. Finalizing the amendments to the nondiscrimination protections to explicitly prohibit discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes is warranted to help remedy health care discrimination and to better address barriers to health equity for LGBTQI+ individuals.400 The revisions to 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) will support the Department’s objective of ensuring consistency against employing discriminatory marketing practices and benefit designs. Comment: Many of the commenters that supported the proposal in the 2023 Payment Notice NPRM suggested ways in which the Department could further strengthen or clarify the breadth of the nondiscrimination protections, such as by expressly prohibiting discrimination on the basis of sex characteristics, including intersex traits. Many commenters also recommended that the Department clarify that gender identity discrimination includes discrimination based on gender expression and transgender status. Such commenters stated that entities often perpetuate discrimination against transgender people because of their gender expression or belief that they are transgender rather than their gender identity itself, which is often private information. These commenters argued that the inclusion of ‘‘gender identity’’ alone in nondiscrimination protections leaves room for confusion or evasion of legal obligations.401 Commenters 399 Brian W. Ward et al., U.S. Dep’t of Health & Hum. Servs., Ctrs. for Disease Control & Prevention, National Health Statistics Report: Sexual Orientation & Health Among U.S. Adults: National Health Interview Survey, 2013 (2014), https:// www.cdc.gov/nchs/data/nhsr/nhsr077.pdfhttps:// www.cdc.gov/nchs/data/nhsr/nhsr077.pdf. 400 Thu T. Nguyen et al., Trends for Reported Discrimination in Health Care in a National Sample of Older Adults with Chronic Conditions, 33 J. Gen. Internal Med. 291–297 (2017), https://doi.org/ 10.1007/s11606-017-4209-5. 401 See U.S. Dep’t of Health & Hum. Servs., FAQs About Affordable Care Act Implementation (Part XXVI), 6, Q5 (May 11, 2015), https://www.cms.gov/ CCIIO/Resources/Fact-Sheets-and-FAQs/ Downloads/aca_implementation_faqs26.pdf. Section 2713 of the PHS Act and its implementing regulations require non-grandfathered group health plans and health insurance issuers offering non- E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 emphasized that expressly incorporating transgender status into Department regulations would provide additional clarity, and would conform the regulation to contemporary protections against discrimination. Response: We agree with commenters that discrimination on the basis of sexual orientation and gender identity may present itself as discrimination on the basis of gender expression and transgender status, which are inextricably linked with one’s gender identity. We believe that gender expression and transgender status are sufficiently addressed by the inclusion of gender identity in the description of discrimination based on sex that is being finalized. Comment: Many commenters supported the proposal as consistent with the overarching intent of the ACA to improve access to health coverage and prohibit discrimination in health care, asserting that the removal of protections on the basis of sexual orientation and gender identity in the 2020 Rule frustrates this purpose by creating barriers to comprehensive care. Many commenters affirmed that the Department has broad authority to regulate in this area under various sections of the ACA independent of section 1557. Specifically, commenters acknowledged that section 1321(a) of the ACA 402 gives the Department broad rulemaking authority to regulate Exchanges and QHPs; section 1312(c) 403 gives the Department authority to establish procedures for States to allow agents or brokers to enroll individuals and businesses in QHPs; section 1302(b)(4) 404 directs the Department, in defining EHB, to ‘‘take into account the health care needs of diverse segments of the population, including women, children, persons with disabilities, and other groups’’; section 1311(c)(1)(A) 405 directs the Department to establish criteria for QHPs to ensure that they will ‘‘not employ marketing practices or benefit designs that have the effect of discouraging the enrollment in such plan by individuals with significant health needs’’; and section 2792 of the grandfathered group or individual health insurance coverage to provide coverage for certain recommended preventive health services without imposing any cost-sharing requirements. Under this requirement, the plan or issuer must provide coverage, without cost sharing, for a recommended preventive service that is medically appropriate for the individual, as determined by the individual’s attending provider, regardless of the individual’s sex assigned at birth, gender identity, or recorded gender. 402 42 U.S.C. 18041(a). 403 42 U.S.C. 18032(c). 404 42 U.S.C. 18022(b)(4), 405 42 U.S.C. 13031(c)(1)(A). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 PHS Act 406 provides the Department with broad authority to promulgate regulations that may be necessary or appropriate to carry out the provisions of title XXVII of the PHS Act, including the guaranteed availability provisions in section 2702,407 added to the PHS Act by the ACA. Response: We agree with commenters that clarifying the scope of sex discrimination aligns with the ACA’s goals of improving access to health insurance and removing unreasonable barriers to care. We reiterate that we are relying on authority from sections 1311(c)(1)(A), 1312(e), and 1321(a)(1)(A), (B), and (D) of the ACA, as well as sections 2702 and 2792 of the PHS Act, to support this change. 87 FR 584, 596. Comment: Some commenters objected to the protections against discrimination on the basis of gender identity, in particular, or stated that the Proposed Rule arbitrarily requires coverage of interventions for individuals diagnosed with gender dysphoria, but not for individuals seeking such procedures for other clinically indicated mental health conditions. Some commenters asserted the proposal is arbitrary and capricious because it requires issuers to provide coverage for a ‘‘one-size-fits-all’’ treatment to gender dysphoria that is unsupported by evidence. Such commenters, believing that the proposal requires coverage of gender-affirming care, stated that the Department can adequately protect people from discrimination without mandating this coverage. Response: One of the primary goals of the proposals to clarify the scope of sex discrimination is to address the pervasive health care discrimination faced by LGBTQI+ patients.408 When medically necessary treatments are categorically excluded when sought by transgender enrollees for purposes of gender-affirming care, but the same such treatments are covered for cisgender 406 42 U.S.C. 300gg–92 U.S.C. 300gg–1. 408 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Disease Control & Prevention, Nat’l Ctr. for Health Statistics, Chapter 25: Lesbian, Gay, Bisexual, and Transgender Health, Healthy People 2020 (2016), https://www.cdc.gov/nchs/data/hpdata2020/ HP2020MCR-C25-LGBT.pdf; Hudaisa Hafeez et al., Health Care Disparities Among Lesbian, Gay, Bisexual, and Transgender Youth: A Literature Review, 9 Cureus e1184 (2017), https://doi.org/ 10.7759/cureus.1184; Karen I. Fredriksen-Goldsen et al., Health Disparities Among Lesbian, Gay, and Bisexual Older Adults: Results From a PopulationBased Study, 103 a.m. J. Pub. Health 1802–1809 (2013), https://doi.org/10.2105/AJPH.2012.301110; Billy A. Caceres et al., A Systematic Review of Cardiovascular Disease in Sexual Minorities, 107 a.m. J. Pub. Health e13–e21 (2017), https://doi.org/ 10.2105/AJPH.2016.303630. 407 42 PO 00000 Frm 00151 Fmt 4701 Sfmt 4700 37671 enrollees, such exclusions may deny transgender individuals access to coverage based on their sex. These types of exclusions, and other types of sex discrimination, can have the effect of discouraging or preventing the enrollment of LGBTQI+ individuals in health insurance coverage. Issuers generally have discretion in designing their benefits packages, and this rule does not require entities to cover any particular procedure or treatment. We clarify that, in finalizing the prohibition against discrimination on the basis of sex, the Department is not mandating that health insurance issuers include coverage for any particular item or service not already covered. However, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide coverage for the health service to all individuals in a neutral, nondiscriminatory manner consistent with this rule. Amending these sections to specify discrimination on the basis of sex includes sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes will help better ensure that all individuals are treated fairly in their access to health care. Without protection from such sex discrimination, transgender individuals may face barriers or be denied medically necessary services that are classified as covered under their plan and made available to other enrolled individuals. Regulations at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) already prohibit discrimination on a variety of bases, including on the basis of 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. Amending these sections to describe sex discrimination will better clarify nondiscrimination protections for all individuals, while also addressing existing disparities for LGBTQI+ individuals seeking health care. Comment: Many commenters that objected to the proposed clarification suggested that coverage of genderaffirming care and any corresponding treatments are unsupported by clinical evidence, harmful to patients, and incongruent with the belief that gender is immutably defined by one’s biological sex. For example, many commenters asserted that due to the lack of clinical evidence, CMS decided in 2016 not to issue a National Coverage Determination E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37672 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations (NCD) 409 for coverage of genderaffirming surgery for Medicare beneficiaries with gender dysphoria. Many objecting commenters also claimed that studies that reach different conclusions (for example, any studies showing efficacy or safety of genderaffirming care) are flawed. Response: We believe that commenters citing the 2016 Medicare NCD decision are incorrectly interpreting the decision. In its final Decision Memorandum on the issue, CMS notes that it declined to issue an NCD specifically on gender-affirming surgery because the clinical evidence is inconclusive, specifically as it relates to the Medicare population (that is, generally individuals 65 or older). CMS clarifies that the result of the decision is not a national coverage prohibition, but rather a continuation of the current policy that coverage decisions for gender-affirming surgery will continue to be made by local Medicare Administrative Contractors (MACs) and Medicare Advantage (MA) plans on a case-by-case basis based on whether gender-affirming surgery is reasonable and necessary for the individual beneficiary after considering the individual’s specific circumstances. Furthermore, the Medicare program did not analyze clinical evidence for counseling or hormone therapy treatments for gender dysphoria and was not making an NCD determination related to counseling, hormone therapy treatments, or any other potential treatment for gender dysphoria. Therefore, not only is the population for which the NCD applies distinct, but so is the scope of the NCD decision itself. Claims made by opposing commenters regarding assertions of patient harm resulting from genderaffirming care, purported lack of evidence demonstrating efficacy of such care, alleged differences between ‘‘biological sex’’ and gender, and hypothetical medical scenarios are not germane to the proposed regulatory text acknowledging that sex discrimination includes discrimination on the basis of sexual orientation or gender identity. While claims about medical evidence and specific treatments may be relevant in evaluating whether a particular action constitutes unlawful discrimination, or whether a particular item or service is medically necessary, such assertions do not speak to the 409 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Decision Memo for Gender Dysphoria and Gender Reassignment Surgery (CAG–00446N) (Aug. 30, 2016), https:// www.cms.gov/medicare-coverage-database/view/ ncacal-decisionmemo.aspx?proposed=N&ncaid=282. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 decision to clarify the scope of sex discrimination in the first place. We also acknowledge that there is a robust consensus in the medical community that gender-affirming care is safe, effective, and medically necessary when clinically indicated for a particular individual. The amendments made concurrent with the 2020 final rule to the nondiscrimination protections in 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) were based on an erroneous assertion that the plain statutory meaning of ‘‘sex’’ does not encompass sexual orientation and gender identity, which is unsupported by Bostock. In addition, the 2020 amendments were based on the incorrect assertion that the denial of basic health care on the basis of genderidentity is not a widespread problem in the United States. Comment: One commenter asserted that the proposed change to the description of sex discrimination is arbitrary and capricious because the Department did not compute the costs of the impact of the rule against the purported benefits of the proposal. Response: As we explained in the 2022 NPRM and based on our experience with States selecting a new EHB-benchmark plan pursuant to 45 CFR 156.111,410 CMS believes there will be minimal costs incurred based on amending these sections to clarify sex discrimination. Because these sections previously prohibited discrimination on the basis of sexual orientation and gender identity, many entities already comply with the prohibition on discrimination, as amended under this final rule. 87 FR 47898. We do not anticipate amending these sections to describe sex discrimination would impose substantial administrative costs on any regulated entities that did not subsequently revise nondiscrimination policies based on the 2020 Rule.411 On 410 See, e.g., U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Information on Essential Health Benefits (EHB) Benchmark Plans Colorado 2023 EHB- Benchmark Plan Actuarial Report, https://www.cms.gov/ marketplace/resources/data/essential-healthbenefits. Suite of Gender-affirming care benefits to treat gender dysphoria resulted cost estimate was 0.04 percent of the total allowed claims assuming utilization would be for adults. 411 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, (2012), https://translaw.wpengine.com/ wp-content/uploads/2013/04/Economic-ImpactAssessment-Gender-Nondiscrimination-In-HealthInsurance.pdf; Aaron Belkin, Caring for Our Transgender Troops—The Negligible Cost of Transition-Related Care, 373 New Eng. J. Med. 1089 (2015), https://www.nejm.org/doi/pdf/10.1056/ NEJMp1509230?articleTools=true; Jody L. Herman, The Williams Inst., UCLA Sch. of Law, Costs and Benefits of Providing Transition-Related Health PO 00000 Frm 00152 Fmt 4701 Sfmt 4700 balance, we believe any costs are justified in light of the potentially significant benefits provided by protecting individuals from discrimination based on sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. We refer readers to our cost benefit analysis in the Regulatory Impact Analysis of this final rule for additional discussion on the minimal cost impacts to plans and issuers to include nondiscrimination protections. 87 FR 47898. Comment: Some commenters objected to a perceived lack of clarity in the Proposed Rules. Such commenters noted that the Proposed Rules did not appropriately discuss the breadth of which markets would be covered by this proposal, questioning whether it would apply to large group plans, fully insured group health plans sponsored by employers, health insurance issuers and third party administrators of selfinsured plans. Response: The amendments we are finalizing to the nondiscrimination regulations at 45 CFR 147.104(e) apply to health insurance issuers offering nongrandfathered group or individual health insurance coverage, and their officials, employees, agents, and representatives. The nondiscrimination amendments we are finalizing at 45 CFR 155.120(c) apply to States and Exchanges carrying out Exchange requirements. The nondiscrimination amendments we are finalizing at 45 CFR 155.220(j) apply to agents, brokers, or web-brokers that assist with or facilitate enrollment of qualified individuals, qualified employers, or qualified employees, in coverage in a manner that constitutes enrollment through an FFE, or assists individuals in applying for advance payments of the premium tax credit and cost-sharing reductions for QHPs sold through an FFE. The nondiscrimination amendments we are finalizing at 45 CFR 156.200(e) apply to QHPs in the individual and small-group markets. Section 156.125(b) requires issuers providing EHB to comply with the requirements of 45 CFR 156.200(e), thereby extending the application to non-grandfathered health insurance coverage in the individual and small group markets that provide EHBs. Care Coverage in Employee Health Benefits Plans: Findings from a Survey of Employers, p. 2, (Sept. 2013), https://williamsinstitute.law.ucla.edu/wpcontent/uploads/Herman-Cost-Benefit-of-TransHealth-Benefits-Sept-2013.pdf; William V. Padula et al., Societal Implications of Health Insurance Coverage for Medically Necessary Services in the U.S. Transgender Population: A Cost-Effectiveness Analysis, 31 J. Gen. Internal Med. 394 (2015), https://pubmed.ncbi.nlm.nih.gov/26481647/. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Lastly, the nondiscrimination protections we are finalizing at 45 CFR 156.1230(b) apply to issuers using direct enrollment on an FFE. Comment: Some commenters noted concerns about how the nondiscrimination protections would apply to health care providers. Response: The amendments we are finalizing at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) do not apply to health care providers. Comment: One commenter asked the Department to provide clarity on the interaction between the section 1557 requirement and the 2023 Notice of Benefit and Payment Parameters final rule regarding non-discriminatory benefit design and EHB. Response: While the requirements of section 1557 and the requirements imposed on EHB are separate requirements, we are finalizing regulatory language in this rule to make compliance easier for entities that are subject to both standards. As we stated in the 2023 Notice of Benefit and Payment Parameters final rule, CMS continues to make refinements to our EHB nondiscrimination policy and will address non-discriminatory benefit design as it relates to EHB in future rulemaking. Comment: Commenters objecting to a more detailed understanding of sex discrimination raised several legal concerns. Commenters stated that the Department’s reliance on Bostock v. Clayton County, 590 U.S. 644 (2020), is inappropriate, misinterprets Bostock, and misapplies the case to section 1557. One commenter asserted that the rule is arbitrary and capricious because it inappropriately applies the title VII framework to health care. Other commenters stated that the proposal is based on a faulty interpretation of title IX. Commenters also asserted that although reverting the nondiscrimination sections to pre-2020 language would allow LGBTQI+ individuals to receive ‘‘medically necessary’’ care, the 2020 rule enforces the plain text enacted by the ACA, which prohibited the discrimination on the basis of sex only. Other commenters cautioned that absent clear congressional authorization, the Department is not justified in promoting the view that sex or gender can be different than the sex assigned to an individual at birth. Other commenters asserted that the rule is arbitrary and capricious because it ignores that a person’s sex is determined by biology and does not sufficiently specify what it means by ‘‘sex’’ and how VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 it relates to gender dysphoria treatments. Response: We disagree that the proposal to include nondiscrimination protections is arbitrary and capricious. We are not relying on or applying the title VII framework to the nondiscrimination protections we are finalizing at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b), nor are we relying on other Federal civil rights laws for statutory authority. As stated in the Proposed Rule, 87 FR 596, we are relying on authority from sections 1311(c)(1)(A), 1312(e), and 1321(a)(1)(A), (B), and (D) of the ACA to support the amendments at 45 CFR 155.120, 155.220, 156.200, and 156.1230. We also rely on authority from sections 2702 and 2792 of the PHS Act to support the amendments to 45 CFR 147.104 and 156.125. Section 2792 of the PHS Act provides the HHS Secretary with broad rulemaking authority to issue regulations as may be necessary or appropriate to carry out the provisions of title XXVII of the PHS Act, including the guaranteed availability provision in section 2702 of the PHS Act, implemented at 45 CFR 147.104, and the EHB requirements in section 2707(a) of the PHS Act, implemented at 45 CFR 147.150 and 156.125. 87 FR 584, 596. We made these proposals and are finalizing these provisions due in large part to the pervasive health and health care disparities faced by people who identify as part of the LGBTQI+ community.412 The aim of this final rule is to address the reality of many consumers in the health care sector and how discrimination on the basis of sex by entities regulated under 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) impairs the ability of consumers to access or pay for quality care. We believe these changes are necessary to address the role of discrimination in perpetuating the pervasive health and health care disparities faced by people 412 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Disease Control & Prevention, Nat’l Ctr. for Health Statistics, Chapter 25: Lesbian, Gay, Bisexual, and Transgender Health, Healthy People 2020 (2016), https://www.cdc.gov/nchs/data/hpdata2020/ HP2020MCR-C25-LGBT.pdf; Hudaisa Hafeez et al., Health Care Disparities Among Lesbian, Gay, Bisexual, and Transgender Youth: A Literature Review, 9 Cureus e1184 (2017), https://doi.org/ 10.7759/cureus.1184; Karen I. Fredriksen-Goldsen et al., Health Disparities Among Lesbian, Gay, and Bisexual Older Adults: Results From a PopulationBased Study, 103 a.m. J. Pub. Health 1802–1809 (2013), https://doi.org/10.2105/AJPH.2012.301110; Billy A. Caceres et al., A Systematic Review of Cardiovascular Disease in Sexual Minorities, 107 a.m. J. Pub. Health e13–e21 (2017), https://doi.org/ 10.2105/AJPH.2016.303630. PO 00000 Frm 00153 Fmt 4701 Sfmt 4700 37673 who identify as part of the LGBTQI+ community. We also disagree with commenters contesting that these nondiscrimination proposals inappropriately align with Bostock. In Bostock, the Supreme Court held that discrimination on the basis of sex under title VII of the Civil Rights Act of 1964 includes discrimination on the basis of sexual orientation and gender identity. Under Bostock’s reasoning, laws that prohibit sex discrimination also prohibit discrimination on the basis of gender identity and sexual orientation.413 Furthermore, the inclusion of ‘‘sex stereotypes’’ is consistent with the Supreme Court’s holding in Price Waterhouse v. Hopkins, 490 U.S. 228, 250–51 (1989). The inclusion of ‘‘pregnancy or related conditions’’ is consistent with the Department’s longstanding interpretation of sex discrimination under Title IX.414 As noted earlier in this preamble, the Department is finalizing these amendments to ensure consistency across the policies and requirements applicable to entities subject to health insurance market and Exchange requirements and those subject to section 1557. Amending CMS nondiscrimination protections to better specify the meaning of sex discrimination is imperative to advancing health equity and ensuring individuals are able to receive health care that is free from discrimination as envisioned under the ACA. Comment: Many commenters to the 2023 Payment Notice NPRM expressed concerns that the proposal infringed on the First Amendment and would lead to violations of the religious conscience of providers, issuers, brokers, agents, and religiously affiliated hospitals. Some of these commenters objected to the inclusion of sexual orientation or gender identity within nondiscrimination protections altogether. Other commenters asserted that it is unclear how CMS would implement RFRA protections in the context of the nondiscrimination protections, and that this lack of clarity would increase the chance of litigation. A few commenters asked for the final rule to include an exemption for any stakeholders with religious objections (including issuers, 413 See, e.g., Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020), cert. denied, 141 S. Ct. 2878 (2021) (‘‘Although Bostock interprets Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e–2(a)(1), it guides our evaluation of claims under Title IX’’); E.O. 13988, 86 FR 7023 (2021). 414 See 45 CFR 86.21(c)(2) and (3); 86.40(b)(1), (4), and (5); 86.51(b)(6); 86.57(b) through (d) (Title IX regulation); see also Conley v. Northwest Fla. State Coll., 145 F. Supp. 3d 1073 (N.D. Fla. 2015). E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37674 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations plan sponsors, or individual purchasers) or to clarify whether there will be a process for such stakeholders to claim an exemption under RFRA outside of litigation. One commenter requested a process under which issuers or the insured can receive an up-front exemption when they have a religious or conscience-based objection to paying for plans that cover benefits to which they object as being experimental and harmful. Other commenters believed that the proposal takes the right approach in relation to moral and religious objections. Response: These regulations are neutral, generally applicable, and do not violate the Free Exercise Clause of the First Amendment. These regulations do not target religiously motivated conduct, but rather, are intended to prohibit sex discrimination generally in order to improve health outcomes and fulfill the statutory command of the ACA to prohibit discrimination and remove unreasonable barriers to care. Certain protections already exist in Federal law with respect to religious or moral beliefs, particularly regarding the provision of certain health-related services. For example, when enforcing its nondiscrimination regulations, HHS will comply with laws protecting the exercise of conscience and religion, including RFRA and all other applicable legal requirements. Nothing in the nondiscrimination protections at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) displaces those protections, and an application of this rule will not be required if it would violate Federal religious freedom and conscience laws. Although some commenters urged CMS to incorporate a categorical religious exemption into this final rule, a blanket religious exemption is not supported by the underlying statutes. We will apply the protections in existing laws in resolving any conflicts between religious beliefs and these nondiscrimination protections. An entity that believes that compliance with any of these provisions would violate their rights under RFRA or the Free Exercise Clause of the First Amendment should contact CMS, which is responsible for evaluating RFRA-based requests for requirements in the programs it operates or oversees.415 An entity that believes that compliance with any provision of this rule would violate their rights under the religious freedom and conscience laws 415 U.S. Dep’t of Health and Hum. Servs., Off. of the Sec’y, Delegation of Authority, 86 FR 67067 (Nov. 24, 2021). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 enforced by HHS’s Office for Civil Rights should file a complaint with OCR. As with any HHS program, if an entity alleges that HHS’s actions have substantially burdened its religious exercise, the Department will apply the test set out by RFRA.416 The RFRA analysis evaluates whether the actions of the Federal Government have substantially burdened an entity’s exercise of religion; if so, the question becomes whether the action furthers a compelling interest and is the least restrictive means to further that interest. RFRA provides that when application of a Federal Government rule or other law would substantially burden a person’s exercise of religion, the government must afford that person an exemption to the rule unless it can demonstrate that applying the burden to that person furthers a compelling governmental interest and is the least restrictive means of doing so.417 Accordingly, under RFRA, we would assess whether a particular application of these rules substantially burdened a stakeholder’s exercise of religion and, if so, whether the government has a compelling interest in denying the stakeholder’s exemption assurance request and whether there are less restrictive alternatives available.418 The government’s compelling interest in prohibiting discrimination on the basis of sex is to improve health outcomes, including for the LGBTQI+ community, and fulfill the statutory command of the ACA to prohibit discrimination. Whether this prohibition imposes a substantial burden on an entity’s exercise of religion and whether it is the least restrictive means of advancing the government’s interest will depend on specific facts and circumstances. The amendments we are finalizing at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) prohibit discrimination on the basis of sex in the conduct of health insurance issuers and their officials, employees, agents, and representatives; States and the Exchanges; agents, brokers, or web-brokers that assist with or facilitate enrollment of qualified individuals, qualified employers, or qualified employees; issuers subject to EHB requirements; and QHP issuers. 416 See 86 FR 67067 (Nov. 24, 2021) (delegation of authority under which all HHS components are to ensure full compliance with RFRA and other constitutional requirements). 417 42 U.S.C. 2000bb–1(b). 418 Fulton v. City of Phila., 593 U.S. (2021) (‘‘The question, then, is not whether the City [of Philadelphia] has a compelling interest in enforcing its non-discrimination policies generally, but whether it has such an interest in denying an exception to [Catholic Social Services].’’). PO 00000 Frm 00154 Fmt 4701 Sfmt 4700 Lastly, we again reiterate that the amendments we are finalizing at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) do not require regulated entities to cover any particular service not already covered. 2. Health Insurance Exchanges a. Non-Interference With Federal Law and Nondiscrimination Standards (45 CFR 155.120) In 45 CFR 155.120 we proposed to amend paragraph (c)(1)(ii) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including sexual orientation and gender identity).’’ We did not receive comments unique to this section. Summary of Regulatory Changes We amend 45 CFR 155.120 in paragraph (c)(1)(ii) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ b. Federally-Facilitated Exchange Standards of Conduct (45 CFR 155.220) In 45 CFR 155.220 we proposed to amend paragraph (j)(2)(i) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including sexual orientation and gender identity).’’ We did not receive comments unique to this section. Summary of Regulatory Changes We amend 45 CFR 155.220 in paragraph (j)(2)(i) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ c. Essential Health Benefits Package: Prohibition on Discrimination (45 CFR 156.125) In 45 CFR 156.200 we proposed to amend § 156.200 in paragraph (e) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including sexual orientation and gender identity).’’ Section 156.125(b) would accordingly require issuers providing EHB to comply with such nondiscrimination requirements as it requires that an issuer providing EHB must comply with the requirements of § 156.200(e). We did not receive comments unique to this section. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Summary of Regulatory Changes Elsewhere in this rule, we amend 45 CFR 156.200 in paragraph (e) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ Paragraph (b) of 45 CFR 156.125 accordingly requires issuers providing EHB to comply with such nondiscrimination requirements as it states that an issuer providing EHB must comply with the requirements of § 156.200(e). d. QHP Issuer Participation Standards (45 CFR 156.200) In 45 CFR 156.200 we proposed to amend paragraph (e) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including sexual orientation and gender identity).’’ We did not receive comments unique to this section. Summary of Regulatory Changes We amend 45 CFR 156.200 in paragraph (e) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ e. Direct Enrollment With the QHP Issuer in a Manner Considered To Be Through the Exchange (45 CFR 156.1230) In 45 CFR 156.1230 we proposed to amend § 156.1230 in paragraph (b)(2) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including sexual orientation and gender identity).’’ We did not receive comments unique to this section. Summary of Regulatory Changes ddrumheller on DSK120RN23PROD with RULES4 We amend 45 CFR 156.1230 in paragraph (b)(2) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes).’’ 3. Prohibition of Discrimination—Group and Individual Health Insurance Markets Guaranteed Availability of Coverage (45 CFR 147.104) In 45 CFR 147.104 we proposed to amend paragraph (e) by revising ‘‘sex’’ to ‘‘sex (including sexual orientation and gender identity).’’ VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 The comments and our responses regarding this proposal are set forth below. Comment: Some commenters requested that CMS clarify that States, including State Attorneys General, may enforce section 1557 to the fullest extent granted by law. That request was in response to CMS’ explanation in the Proposed Rule that it was not relying on section 1557 as authority to amend 45 CFR 147.104 because states would not have authority to enforce section 1557 and CMS is of the view that partial reliance on section 1557 could unnecessarily complicate enforcement efforts. 87 FR 47898. Response: In the Proposed Rule, CMS explained that one of the primary reasons CMS did not propose to rely on section 1557 authority to amend 45 CFR 147.104 was the manner in which § 147.104 is enforced. As discussed in the Proposed Rule, under PHS Act section 2723, States have primary enforcement authority over issuers with respect to regulations that implement title XXVII of the PHS Act, which includes § 147.104. CMS has a responsibility to enforce such regulations if CMS determines that a State is not substantially enforcing or the State notifies CMS that it has not enacted legislation to enforce or is not otherwise enforcing such regulations; otherwise, the State retains primary enforcement authority. Because section 1557 is not codified in title XXVII of the PHS Act, PHS Act section 2723 does not provide States with the authority to enforce section 1557. Therefore, CMS continues to be of the view that partial reliance on section 1557 authority could unnecessarily complicate enforcement efforts of § 147.104. For this reason and because § 147.104 applies to issuers that may not receive Federal financial assistance such that they would be subject to section 1557, CMS relies on its authorities under sections 2702 and 2792 of the PHS Act when amending § 147.104. Notwithstanding the foregoing, the Department clarifies that although States do not enforce the administrative procedures specified in the section 1557 regulation itself, States may utilize their independent enforcement authorities to pursue violations of law, including applicable Federal laws, by entities within their jurisdictions. Summary of Regulatory Changes We amend 45 CFR 147.104 in paragraph (e) by removing the term ‘‘sex’’ and adding in its place the phrase ‘‘sex (including discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related PO 00000 Frm 00155 Fmt 4701 Sfmt 4700 37675 conditions; sexual orientation; gender identity; and sex stereotypes).’’ V. Executive Order 12866 and Related Executive Orders on Regulatory Review A. Regulatory Impact Analysis We have examined the impacts of the final rule under E.O. 12866, E.O. 14094, E.O. 13563, the Regulatory Flexibility Act (5 U.S.C. 601–612), the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4), and E.O. 13132 on Federalism. E.O.s 12866 and 13563 direct us to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). Section 3(f) of E.O. 12866 (as amended by E.O. 14094) defines a ‘‘significant regulatory action’’ as any regulatory action that is likely to result in a rule that may: (1) have an annual effect on the economy of $200 million or more (adjusted every 3 years by the Administrator of the Office of Information and Regulatory Affairs (OIRA) for changes in gross domestic product); or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, territorial, or Tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise legal or policy issues for which centralized review would meaningfully further the President’s priorities or the principles set forth in this Executive order, as specifically authorized in a timely manner by the Administrator of OIRA in each case. This final rule is a significant regulatory action, under sec. 3(f)(1) of E.O. 12866 (as amended by E.O. 14094). The Regulatory Flexibility Act requires us to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because the costs of the final rule are small relative to the revenue of covered entities, including covered small entities, and because even the smallest affected entities would be unlikely to face a significant impact, we are certifying that the final rule will not have a significant economic impact on a substantial number of small entities. The Unfunded Mandates Reform Act of 1995 (section 202(a)) generally E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37676 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations requires us to prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing ‘‘any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any 1 year.’’ The current threshold after adjustment for inflation is $177 million, using the most current (2022) Implicit Price Deflator for the Gross Domestic Product. This final rule is not subject to the Unfunded Mandates Reform Act because it falls under an exception for regulations that establish or enforce any statutory rights that prohibit discrimination on the basis of race, color, religion, sex, national origin, age, or disability.419 E.O. 13132 on Federalism establishes certain requirements that an agency must meet when it promulgates a Proposed Rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has federalism implications. In considering the principles in and requirements of E.O. 13132, the Department has determined that the final rule would not significantly affect the rights, roles, and responsibilities of the States. The Congressional Review Act (CRA) defines a ‘‘major rule’’ as any rule that the Administrator of OIRA of the Office of Management and Budget finds has resulted in or is likely to result in: (A) ‘‘an annual effect on the economy of $100,000,000 or more’’; (B) ‘‘a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions’’; or (C) ‘‘significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreignbased enterprises in domestic and export markets.’’ 5 U.S.C. 804(2). Based on the analysis of this final rule under E.O. 12866, this rule is expected qualify under 5 U.S.C. 804(2)(A). The Department will comply with the CRA’s requirements to inform Congress. The Background and Reasons for the final rulemaking sections at the beginning of this preamble contains a summary of this final rule and describes the reasons it is needed. 1. Public Comments Comment: OCR received some comments discussing the cost of notices 419 2 U.S.C. 1503(2). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 and taglines 420 in addition to requests that OCR work with the health care industry to develop future regulations. One commenter explained how the cost of including taglines averages up to $8.91 per month per covered entity and upwards of $2 million a year for the health insurance industry. Another health insurer commenter stated that they have spent over $16 million on notices and taglines since 2016 and estimated that they have spent over $3 million in 2022 alone. However, neither commenter provided data explaining the source or more detail on the cost estimates. Another commenter noted that the Proposed Rule does not adequately answer complaints received in prior 1557 rulemakings on the frequency and volume of materials related to the notice and tagline sections of the rule but did not provide any data with their comment. Response: Based on costs estimated in this analysis, OCR derives a monthly cost of notices ranging from $21.28 to $26.60 per entity depending on the prevalence of electronic delivery. These cost estimates include the total notices of nondiscrimination and notices of availability of language assistance services and auxiliary aids and services (‘‘Notices of Availability’’); OCR therefore finds the commenter’s estimate of $8.91 per month for Notices of Availability as plausible and consistent with the estimates in section 2 of the Regulatory Impact Analysis. OCR also notes that the cost estimates that are given are averages, and it is expected that there will be some entities that would have costs that are well above or below average. Furthermore, it is expected that large entities would have higher than average costs due to the increased number of notices they would send to individuals. Comment: A few commenters expressed general concerns on the potential for an increase in premiums and costs within the health care industry. Commenters suggested the final rule would create a moral hazard for individuals or made general statements without data that increasing coverage of goods and services would increase costs and resulting premiums. Other commenters focused on the harm to small business the rule would cause from raising the insurance costs for lowincome individuals that small businesses employ. Commenters argued this would lead to layoffs of said 420 Commenters referred to ‘‘taglines,’’ which were required in the 2016 Rule at former § 92.8(d). This final rule does not require ‘‘taglines’’ but instead requires a notice of availability of language assistance services and auxiliary aids and services (referred to as ‘‘Notice of Availability’’) at § 92.11. PO 00000 Frm 00156 Fmt 4701 Sfmt 4700 employees and limit what services would be available. Response: As discussed in section 2 of the RIA, OCR expects that there is a possibility of increased premiums and costs due to the rule, but the possible increase is expected to be a small percentage of the current costs due to the low utilization of gender-affirming care and supply of specialists capable of offering said services. OCR does not expect the final rule to have a significant economic impact on small entities based on the analysis in the Regulatory Flexibility Act (RFA). Comment: A couple of commenters were concerned that the rule would make it more difficult for small entities to compete and remain compliant, which would give a competitive advantage to larger entities in the industry and lead to more consolidation of supplier and provider markets. Response: OCR appreciates the concerns raised by these commenters; however, as discussed in the RFA, OCR does not expect a significant impact of costs on a substantial number of small entities. Comment: A few commenters claimed that the final rule would lead to lower innovation within the health care industry due to an increased need to spend funds fighting discrimination instead of medical research. Response: As discussed in section 2 of the RIA, OCR estimates that additional costs from the inclusion of nondiscrimination requirements will be a small percentage of the total cost due to the limited number of individuals that would seek gender-affirming care, thereby limiting any potential decrease in available funds for medical research. Comment: A few commenters expressed concern that the final rule would limit rural health care because it would make it more difficult for rural entities to stay compliant and would worsen their financial positions, potentially resulting in closures. Response: As discussed in section 2 of the RIA, OCR estimates that the costs associated with the final rule would be a small percentage increase in overall costs. Furthermore, OCR reviewed relevant literature and found no studies which suggested that rural hospitals would be particularly impacted by expanded health care services. Finally, as discussed in the small entity analysis section of this RIA, OCR does not estimate a significant economic impact on a substantial number of small entities. Comment: Several commenters expressed concern that the final rule would lead to fewer health care professionals in the industry for a E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations variety of reasons. Some of the commenters stated that the final rule would lead to health care professionals leaving the industry from the lack of conscience or religious exemptions. A couple of commenters stated that future health care professionals would not enter the industry in the future as the final rule would require them to violate the Hippocratic Oath or their religious beliefs. Response: As discussed in section 2 of the RIA and preamble of the rule, the final rule includes a variety of protections for religious freedom and conscience rights, including a process whereby entities may rely on these protections and seek assurance of them from HHS. See § 92.302. Comment: Several commenters noted that portions of the data that were used in the RIA, such as the number of covered entities and number of small entities, are outdated and need to be updated for an accurate cost estimate to be made. Response: OCR agrees with commenters that data sources could be updated from the Proposed Rule. In this final rule RIA, the data for the number of covered entities, number of entities with more than 15 employees, the number of small entities, and hourly wages have been updated to the most recent data available. Comment: A few commenters expressed concern that the final rule would cause irreparable harm to individuals who regret transitions. Response: Commenters do not provide supporting evidence or data on the frequency or cost of potential irreparable harm. OCR disagrees with the commenters and did not find studies providing evidence or data on the frequency or cost of what the commenters characterize as irreparable harm, and therefore makes no changes to the final rule. Comment: One commenter expressed concern that long-term costs associated with gender-affirming care are not accounted for within the RIA and that the studies used may not be accurate. Due to this, the commenter stated that the supplementary information provided is at best speculative. Response: The main source for costs related to gender-affirming care come from a peer reviewed article in the New England Journal of Medicine, a wellrespected medical journal. The cost associated with gender-affirming care is based on actual cost data from the Defense Manpower Data Center, which is part of the Department of Defense (DOD). As noted, the final rule does not mandate the provision of or coverage of gender-affirming care, or any particular health service. However, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide the health service to all individuals in a neutral, nondiscriminatory manner consistent with this rule. Comment: One commenter stated that the costs of algorithmic discrimination have been quantified and asked OCR to include examples of the costs of such discrimination. Response: OCR includes a specific provision on algorithmic discrimination in the final rule and qualitatively discusses the potential costs to individuals from discriminatory application of algorithms and other decision support tools in the benefits section. 2. Summary of Costs and Benefits This analysis quantifies several categories of costs to covered entities and to the Department under the final rule. Specifically, we quantify costs 37677 associated with covered entities training employees, revising policies and procedures, and costs associated with notices, including the Notice of Nondiscrimination and Notice of Availability. We quantify costs associated with provisions of the final rule related to documenting training activities performed under the final rule. We also quantify incremental costs associated with coverage for genderaffirming care (which, as noted above, is not mandated by the rule). Our analysis also addresses uncertainty in costs associated with notices and genderaffirming care, which is discussed in greater detail in the notices section of subsection B of section 2 of the RIA. We separately report a full range of cost estimates of about $523 million to $1,302.3 million using a 7 percent discount rate, and a full range of cost estimates of about $511.4 million to $1,290.7 million using a 3 percent discount rate. All cost estimates are in 2022 dollars. We conclude that the final rule would result in annualized costs over a 5-year time horizon of $646.5 million or $637.1 million, corresponding to a 7 percent or a 3 percent discount rate respectively. In addition to these quantified cost estimates, the main analysis includes a discussion of costs that we do not quantify, and a discussion of the potential benefits under the rule that we similarly do not quantify. In addition to the impacts that we quantify, this final rule could also result in increases in premiums, which would result in increases in Exchange user fees and Federal expenditures for advance payments of the premium tax credit. These increases would be minimal due to the low utilization of gender affirming care and the availability of the services. TABLE 1—ANNUALIZED COSTS OF THE FINAL RULE [$ millions/year (percent)] Primary estimate Low estimate ddrumheller on DSK120RN23PROD with RULES4 $646.5 $637.1 High estimate $523 511.1 a. Baseline Conditions Section 1557 prohibits an individual from being excluded from participation in, denied the benefits of, or otherwise subjected to discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities. It applies to any health program or activity, any part of which is receiving Federal financial assistance, VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Discount rate (percent) Year dollars $1,302.3 1,290.7 2022 2022 and to any program or activity that is administered by an executive agency or any entity established under title I of the ACA.421 On May 18, 2016, the Department published a final rule to implement section 1557 under the statute5 U.S.C. 301. 81 FR 31375. On June 19, 2020, the Department 421 42 PO 00000 7 3 Fmt 4701 Sfmt 4700 2024–2028 2024–2028 published a final rule that revised the Department’s approach to implementing section 1557. 85 FR 37160. As described in greater detail in the Background section of this preamble, neither final rule was fully implemented as published, and certain provisions of the 2020 Rule remain the subject of ongoing litigation. U.S.C. 18116. Frm 00157 Period covered E:\FR\FM\06MYR4.SGM 06MYR4 37678 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations The baseline scenario of no further regulatory action is substantially informed by the RIAs published with the 2016 and 2020 Rules. The 2016 RIA identified five sources of monetized costs: training and familiarization, enforcement, notice publication, sex discrimination policy and procedure changes, and language access plans. The bulk of the monetary impacts identified in the 2016 RIA occur in the first two years under the 2016 rule, with costs continuing in future years only for enforcement and language access plans. The 2020 RIA adopted many of the assumptions contained in the 2016 RIA. For example, it assumed that many of the initial activities anticipated under the 2016 Rule were performed, and that the first two years of costs attributable to the 2016 Rule were incurred.422 The 2020 RIA identifies cost savings only ‘‘from the repeal of (1) the provision on the incentive for covered entities to develop language access plans and (2) the provisions on notice and taglines.’’ 85 FR 37224. The 2020 RIA also identifies costs in the first year ‘‘on covered entities’ voluntary actions to retrain their employees on, and adopt policies and procedures to implement, the legal requirements of this final rule.’’ 85 FR 37224. In establishing a baseline scenario, this analysis similarly maintains a number of assumptions and estimates contained in prior analyses. For example, the baseline scenario includes some ongoing costs that are attributable to the 2016 Rule, such as the costs of enforcement. The 2016 RIA estimated that the costs of enforcement would be $108.8 million (reported in 2022 dollars), which we adopt as the costs under both the baseline and final rule scenarios. Similarly, we adopt the assumption in the 2020 RIA that covered entities continue to provide ongoing training attributable to the 2016 Rule, which was not impacted by the 2020 Rule. We include these ongoing training activities, including annual refresher training for returning employees and training for new employees, in the baseline scenario of no regulatory action. The final rule analysis updates baseline conditions on the number of covered entities. The 2016 Rule, 2020 Rule, and 2022 NPRM all used 275,002 covered entities, and 41,250 covered entities that have 15 or more employees. This final rule updates the covered entities to 266,297 and the number of covered entities with 15 or more employees to 63,950. Table 2 presents the updated data on covered entities. To update this data, we identified the source of the original data being the 2012 Statistics of U.S. Businesses (SUSB) Annual Data Tables by Establishment Industry and found the 2020 version of the same dataset. Using the same NAICS codes from the Proposed Rule we identify the number of entities under these NAICS codes in addition to the number of firms with 15 or more employees. TABLE 2—COVERED ENTITIES NAICS code Business type 62142 ............................................................................. Outpatient mental health and substance abuse centers. HMO medical centers ..................................... Kidney dialysis centers ................................... Freestanding ambulatory surgical and emergency centers. All other outpatient care centers ..................... Medical and diagnostic laboratories ............... Home health care services ............................. All other ambulatory health care services ...... Residential intellectual and developmental disability facilities. General medical and surgical hospitals .......... Psychiatric and substance abuse hospitals .... Specialty (except psychiatric and substance abuse) hospitals. Nursing care facilities (skilled nursing facilities). Pharmacies and drug stores ........................... Offices of physicians ....................................... Insurance Issuers ............................................ Navigator grantees .......................................... Total Entities ................................................... 621491 ........................................................................... 621492 ........................................................................... 621493 ........................................................................... 621498 ........................................................................... 6215 ............................................................................... 6216 ............................................................................... 6219 ............................................................................... 62321 ............................................................................. 6221 ............................................................................... 6222 ............................................................................... 6223 ............................................................................... 6231 ............................................................................... 45611 ............................................................................. 6211 ............................................................................... 524114 ........................................................................... ddrumheller on DSK120RN23PROD with RULES4 In the next section, we discuss the incremental costs of the final rule, which exclude ongoing costs attributable to prior rulemaking. b. Costs of the Final Rule This analysis anticipates that the final rule would result in one-time costs to covered entities to process assurance of exemption requests and revise policies 422 E.g., 85 FR 37235 (‘‘The Department assumes sunk costs cannot be recovered by this rule, and VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Firm count 2020 Firms with 15 or more employees 7,649 2,911 84 449 4,554 21 216 2,204 6,307 7,200 25,718 7,091 6,674 2,766 1,892 10,901 2,589 3,628 2,445 434 301 2,344 414 280 9,824 7,513 19,346 167,294 869 58 3,436 22,494 341 .............................. 266,297 63,950 and procedures. The final rule would result in costs associated with a revised approach to notices, including the Notice of Nondiscrimination and Notice of Availability, costs to review new decision support tool requirements, and costs to training employees. The final rule would also result in costs associated with provisions related to documenting training activities performed under the final rule. The final rule might result in additional costs associated with coverage for gender-affirming care. We discuss the potential costs associated with gender-affirming care coverage and the potential that some or all of these costs would be offset by reductions in spending on other types of care. We therefore that initial language access plan development costs attributable to the 2016 Rule cannot be recovered.’’). PO 00000 Frm 00158 Fmt 4701 Sfmt 4700 E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 reiterate that the final rule does not mandate the provision of or coverage of gender-affirming care, or any particular health service. However, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide the health service to all individuals in a neutral, nondiscriminatory manner consistent with this rule. The analysis also discusses other potential costs of the final rule that we do not quantify. Training The Department anticipates that some covered entities would incur costs to train or retrain employees under the final rule. To calculate the costs related to training, we followed an approach common to both the 2016 and 2020 RIAs. Both analyses estimate that covered entities would train their employees on the requirements. This final rule uses the updated estimate of covered entities (266,297) as the basis for calculating the total costs. The 2020 RIA adjusted the number of covered entities downward by 50 percent, anticipating that some covered entities would not modify their procedures in response to the 2020 final rule, and would therefore not need to offer new training. Both RIAs anticipated that employers would most likely train employees who interact with the public and recognized that the percentage of employees that interact with patients and the public vary by covered entity. To account for this, the analyses adopted a central estimate of 50 percent of staff at covered entities that received one-time training on the requirements of the regulation. Both RIAs reported the number of employees at covered entities by occupation category. To monetize the total costs of training, the RIAs adopted a value of time based on the average fully loaded wage rate for each occupation, combined with an assumption about the duration of the training. The 2016 RIA assumed that 50 percent of total employees at covered entities would receive training, while the 2020 RIA assumed that 25 percent of employees would receive training. Both RIAs assumed the typical training would last one (1) hour. For this analysis, we assume that 75 percent of total employees at covered entities would receive training, and that this training would last one (1) hour. This estimate is consistent with an assumption that all covered entities would revise their policies and procedures under the final rule and that most employees at covered entities would receive training. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 As a necessary first step in calculating the incremental total costs of training attributable to the final rule, we have collected the most recent available data on the number of employees that would likely undergo training under the final rule, and data on the average wage rate by occupation for these employees. The first category of health care staff that may receive training comprises health diagnosing and treating practitioners. This category includes physicians, dentists, optometrists, physician assistants, occupational, physical, speech and other therapists, audiologists, pharmacists, registered nurses, and nurse practitioners. The U.S. Bureau of Labor Statistics (BLS) Occupational code for this grouping is 29–1000, and the 2022 reported employment count for this occupational group is approximately 5.96 million, with average loaded wages of $114.42 per hour at the national level.423 The second category of health care staff that the Department assumes will receive training comprises degreed technical staff (Occupation code 29– 2000) and accounts for 2.95 million employed individuals with average loaded wages of $51.18 per hour at the national level.424 Technicians work in almost every area of health care: x-ray, physical, speech, psychiatric, dietetic, laboratory, nursing, and records technicians, to name but a few areas. The third category of health care staff that the Department assumes will receive training comprises non-degreed medical assistants (Occupation code 31– 0000), which includes psychiatric and home health aides, orderlies, dental assistants, and phlebotomists. Health care support staff (non-degreed, medical assistants) operate in the same medical disciplines as technicians, but often lack professional degrees or certificates often required for degreed technical staff. There are approximately 6.79 million employed individuals in these occupations in the health care and social assistance sector, with average loaded wages of $34.20 per hour at the national level.425 423 U.S. Bureau of Labor Statistics, May 2022 National Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_ nat.htm. The average loaded wage for Healthcare Diagnosing or Treating Practitioners is derived by multiplying the mean hourly rate by 200 percent to include the mean hourly wage, the cost of fringe benefits and overhead costs ($57.21 * 200% = $114.42). 424 U.S. Bureau of Labor Statistics, May 2022 National Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_ nat.htm. 425 U.S. Bureau of Labor Statistics, May 2022 National Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_ nat.htm. PO 00000 Frm 00159 Fmt 4701 Sfmt 4700 37679 The fourth category of health care staff that the Department assumes will receive training is health care managers (Occupation code 11–9111) and accounts for approximately 0.48 million employed individuals with average loaded wages of $123.06 per hour at the national level.426 The fifth category of health care staff that the Department assumes will receive training is office and administrative assistants (Occupation code 43–0000) and accounts for approximately 2.719 million employed individuals with average loaded wages of $41.16 per hour within the Health Care and Social Assistance sector.427 These workers are often the first staff patients encounter in a health facility and, because of this, covered entities might find it important that staff, such as receptionists and assistants, receive training on the regulatory requirements. The Department assumes that outreach workers are included in the five categories listed above. The Department estimates that there are a total 18.9 million employees at covered entities, of which we assume 14.2 million, 75 percent, would receive training attributable to the final rule. Across the five occupation categories, we estimate a weighted hourly wage rate of $32.70, or a weighted fully loaded hourly wage rate of $65.41. Assuming that the average training takes one (1) hour and adopting a value of time based on fully loaded wage rates, we estimate total first-year training costs for all covered entities to be approximately $927.3 million 428 As a sensitivity analysis, we considered the scenario of covered entities providing training to all employees, 18.9 million, not just employees who interact with the public, 14.2 million. Under this scenario, the total cost of training would increase to about $1.2 billion. These costs are likely overstated since this training may supplement or replace expected annual or other ongoing training activities at covered entities. To the extent that covered entities reduce time spent on other training activities, these costs would offset some of the total costs attributable to the final rule. Lastly, the Department assumes that 91 investigators at OCR, who are equivalent to GS–12 Step 1 employees 426 U.S. Bureau of Labor Statistics, May 2022 National Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_ nat.htm. 427 U.S. Bureau of Labor Statistics, National Industry-Specific Occupational Employment and Wage Estimates, Sector 62- Health Care and Social Assistance, https://www.bls.gov/oes/current/ naics2_62.htm#43-0000. 428 Numbers may not multiply due to rounding. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37680 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations and whose average hourly loaded wage is $65.46, will receive a one-time training during the first year of the promulgation of this rule.429 Each individual would receive 8 hours of training for a total of $47,655 (91 x 1 x $65.46) in training costs. This training would not occur in any subsequent years. In addition to the first-year training costs, we anticipate that the final rule would result in additional costs associated with ongoing training, including annual refresher training for returning employees and training for new employees. As discussed in the Baseline Conditions section, we assume that many covered entities are routinely carrying out these activities, absent further regulatory action. However, we anticipate that the final rule would result in a larger share of employees at covered entities receiving such training. To quantify the change in training activities between the baseline scenario and the final rule scenario, we take the difference between the share of employees receiving training under the baseline scenario and the final rule scenario. We carry through an assumption from the 2016 RIA, which assumed that 50 percent of total employees at covered entities receive training and compare this to an assumption in this final RIA that 75 percent of total employees at covered entities would receive training. This yields an estimate of 25 percent of total employees at covered entities that would receive training in subsequent years under the final rule. We adopt the same weighted hourly wage estimate, number of employees, and estimate the total ongoing annual training costs as $309.1 million. This was calculated by multiplying the total number of employees at covered entities by .25 and multiplying by $65.41. Finally, the Department assumes covered entities may require employees to undergo one (1) hour of training in response to in OCR investigation. As it is difficult to determine the type of employee that would be required go through additional training, we use the average loaded hourly wage of $65.41 to evaluate the opportunity cost of training time. To estimate the frequency with which covered entities may assume this cost, we reviewed OCR complaints from the 2023 calendar year and identified 60 cases investigated under section 1557 that were closed with a covered entity either engaging in voluntary corrective 429 U.S. Off. of Personnel Mgmt., Salary Table 2022–GS. GS–12 Step 1 Employee, https:// www.opm.gov/policy-data-oversight/pay-leave/ salaries-wages/salary-tables/pdf/2022/GS_h.pdf/. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 action in response to the investigation or entering into a Voluntary Resolution Agreement with the agency.430 Using this as a baseline, the Department assumes that for every year of the observation period there would be 60 potential instances of this additional training, and that it would be conducted in each case. As a result, we estimate that covered entities would incur $3,924 in additional training costs for every year of the observation period.431 Revising Policies and Procedures As discussed above in the previous section, the Department anticipates that all covered entities, or approximately 266,297 entities, would revise their policies and procedures under the final rule, with approximately half of these entities requiring less extensive revisions. For covered entities with more extensive revisions, we adopt the estimates contained in the 2020 RIA, with four (4) total hours spent on revisions per entity. Of these, three (3) would be spent by a mid-level manager equivalent to a first-line supervisor (Occupation code 43–1011), at a cost of $62.98 ($31.49 × 2) per hour after adjusting for the cost of fringe benefits and other indirect costs, while an average of one (1) hour would be spent by executive staff equivalent to a general and operations manager (Occupation code 11–1021), at a cost of $118.14 ($59.07 × 2) per hour at the national level, including the cost of fringe benefits and other indirect costs.432 For covered entities with less extensive revisions, we assume two (2) total hours spent on revisions per entity. Of these, one (1) would be spent by a mid-level manager, and one (1) would be spent by executive staff. We monetize the time spent on revising policies and procedures by estimating a total cost per entity of $307.08 or $181.12, depending on the extent of the revisions. For the 133,149 covered entities with more extensive revisions, we estimate a total cost of about $40.8 million. For the 133,149 covered entities with less extensive revisions, we estimate a total cost of about $24.1 million. We estimate the total cost associated with revisions to policies and procedures under the final rule of $65.0 million. 430 U.S. Dep’t of Health & Hum. Servs., Off. for Civil Rts., Complaints Closed During Calendar Year 2023 within the Section 1557 Program Area. 431 $3,924 = ($65.41 × 1 × 60). 432 U.S. Bureau of Labor Statistics, Occupational Employment and Wages, May 2022, 43–1011 FirstLine Supervisors of Office and Administrative Support Workers, https://www.bls.gov/oes/current/ oes431011.htm. PO 00000 Frm 00160 Fmt 4701 Sfmt 4700 The above estimates of time and number of entities that would choose to revise their policies under the regulation are approximate estimates based on general BLS data. We are unable to precisely estimate the total number of covered entities that would choose to revise their policies and procedures under the new regulation or to what extent they would make these changes due to the wide range of types and sizes of covered entities, from complex multi-divisional hospitals to small neighborhood clinics and physician offices. In addition to the initial revisions of policies and procedures, the Department assumes some covered entities may elect or be required to revise their policies and procedures following an investigation. We assume that such revisions would cost the same as the original revision that occurs in the first year of the observation period. As discussed above, the Department estimates that during every year of the observation period, there would be an average of 60 instances in which corrective actions may be taken due to a 1557 investigation. As revising policies and procedures is a more significant corrective action compared to corrective training, the Department assumes that it will occur in response to only half of the investigations. The Department continues to use the assumption that half of the entities revising their policies and procedures would be major firms while the other half would be minor firms. The estimated total annual cost for revisions of policies and procedures in response to an OCR investigation is $7,323 (307.08 × 15 + 181.12 × 15) in each year of the observation period. Notices The final rule requires the 266,297 covered entities to provide a Notice of Nondiscrimination to participants, enrollees, and beneficiaries, hereafter referred to as beneficiaries of its health program or activity, and members of the public. It also requires covered entities to provide a Notice of Availability. These provisions resemble elements of the 2016 Rule that were repealed in the 2020 Rule; however, the approach under the final rule provides a narrower set of situations where covered entities would be required to provide these notices. Both types of notices are required (1) on an annual basis; (2) upon request; (3) at a conspicuous location on the covered entity’s health program or activity website; and (4) in clear and prominent physical locations where the health program or activity interacts with the public. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations The Notice of Availability is also required in the following electronic and written communications related to the covered entity’s health programs and activities: (1) notice of nondiscrimination required by final § 92.10; (2) notice of privacy practices required by 45 CFR 164.520; (3) application and intake forms; (4) notices of denial or termination of benefits or services, including Explanations of Benefits (EOBs) and notices of appeal and grievance rights; (5) communications related to an individual’s rights, eligibility benefits, or services that require or request a response from a beneficiary; (6) communications related to a public health emergency; (7) consent forms and instructions related to medical procedures or operations, medical power of attorney, or living will (with an option of providing only one notice for all documents bundled together); (8) discharge papers; (9) communications related to the cost and payment of care with respect to an individual, including good faith estimates and medical billing and collections materials; (10) complaint forms; and (11) patient and member handbooks. For the purposes of the Notice of Availability analysis, we base our estimates of the number of communications containing these notices on a subset of the communications identified in the 2020 RIA. We include communications that are EOBs. The Department received feedback regarding the financial burden imposed by applying the Notice of Availability requirements to EOBs. EOBs are typically an individual’s first, and often only, notice of a denial or termination of benefits or services, and as such, the Notice of Availability requirement is essential in this context to ensure timely and equitable access to appeals processes. The final rule at § 92.11(d) permits covered entities to provide individuals with the option to opt out of receiving the Notice of Availability on an annual basis, which will reduce the cost and burden associated with these requirements. In addition, as beneficiaries increasingly elect to receive EOBs and other types of communications electronically, we expect the cost of these requirements to decrease over time. We adopt the other estimates as a reasonable proxy for the number of communications that would be anticipated under the final rule. These estimates are intended to encompass all categories of Notices of Availability required under the final rule. We have increased the total number of communications containing notices by 10 percent to account for the additional communications related to the cost and payment of care with respect to an individual, including good faith estimates and medical billing and collections materials, which were not included in the Proposed Rule.433 Table 3 below reports the number of communications containing notices anticipated under the final rule and presents the costs of these communications. Our cost estimates reflect a wide range of uncertainty in the cost per communication. For our primary scenario, we adopt a central estimate of the average costs to print 37681 and fold paper forms containing prescribing information of $0.05 (calculated as the midpoint estimate of a range from $0.03 to $0.07), reported in 2010 dollars.434 We explore the sensitivity of the overall cost estimates under a low-cost ($0.035 per unit) and high-cost ($0.32 per unit) scenario, reported in 2018 dollars, which matches the range contained in the 2020 RIA. We adjust these per-unit cost inputs for inflation to 2022 price levels using the Implicit Price Deflator, resulting in a primary per-unit cost estimate of about $0.067 and a full range of about $0.045 to $0.37.435 Combining these per-unit cost estimates with the count of each notice results in a primary estimate of $93.2 million, with a range of estimates between $57.2 million and $522.8 million. Following the approach in the 2020 RIA, we adjust this figure downward by 50 percent to account for the lower cost of electronic communications. For this adjustment, we adopt a measure of the share of respondents reporting that they used a ‘‘Digital (mobile app or website)’’ method to contact or interact with their health insurance issuer or plan in the last year when viewing an online statement.436 We anticipate that the share of communications occurring online will increase over time but have not accounted for a trend for the 5-year time horizon of this analysis. This adjustment results in a primary estimate of the adjusted annual total of $46.6 million, with a range of costs between $28.6 million and $261.4 million. These costs would occur in each year of the time horizon of the analysis. TABLE 3—COST OF NOTICE PROVISIONS [2022 Dollars] Cost scenario ($ millions) Count (millions) Cost element Low ddrumheller on DSK120RN23PROD with RULES4 Eligibility and enrollment communications ....................................................... Annual notice of benefits ................................................................................. Explanations of benefits—hospital admissions ............................................... Explanations of benefits—physician visits ....................................................... Medical bills—hospital admissions .................................................................. Medical bills—physician visits .......................................................................... Total, Unadjusted ............................................................................................. Total, Adjusted for Electronic Delivery ............................................................ 433 This reflects the increase from 10 categories accounted for by communications and notices in the Proposed Rule RIA to 11 categories, or an increase of 10 percent. 434 U.S. Dep’t of Health & Hum. Servs., Food & Drug Admin., Electronic Distribution of Prescribing VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 19.5 135.3 105.6 1035.1 12.1 108.9 1416.5 1133.2 Information for Human Prescriptions Drugs, Including Biological Products, Proposed Rule, 79 FR 75506 (Dec. 18, 2014). 435 Fed. Reserve Bank of St. Louis, Gross Domestic Product: Implicit Price Deflator (GFPDEF), https://fred.stlouisfed.org/series/GDPDEF. PO 00000 Frm 00161 Fmt 4701 Sfmt 4700 Primary $0.8 5.5 4.3 41.8 0.5 4.4 57.2 28.6 $1.3 8.9 6.9 68.1 0.8 7.2 93.2 46.6 High $7.2 49.9 39.0 382.0 4.5 40.2 522.8 261.4 436 Saurabh Gupta et al., HFS Rsch. & Cognizant, Health Consumers Want Digital: It’s Time for Health Plans to Deliver, p. 4 (2021), https:// www.cognizant.com/en_us/general/documents/ cognizant-hfs-health-consumers-want-digital-itstime-for-health-plans-to-deliver.pdf. E:\FR\FM\06MYR4.SGM 06MYR4 37682 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 Documentation Requirements The final rule requires covered entities to contemporaneously document certain other activities performed under the final rule. This includes activities such as employees’ completion of the training required by this section in written or electronic form. The final rule also requires covered entities to retain certain records. These and other requirements, and the associated cost estimates, are discussed in greater detail in the PRA section. The costs associated with retaining records related to grievances filed with a covered entity is the time spent by the staff of covered entities to store the complaints for no less than three (3) years. We calculate the costs of labor as one (1) employee per covered entity with more than 15 employees (63,950) spending 10 hours to store complaints and the associated records required under final § 92.8(c)(2) each year.437 We assume that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation is $19.02 per hour, which we double to account for overhead and other indirect costs. We estimate the costs of retaining records related to grievances filed at all covered entities would be $24.3 million annually ($19.02 × 2 × 10 × 63,950). This estimation approach will overstate the costs if many covered entities already retain complaint information. The costs associated with documenting employee training is the time spent by the staff of covered entities to (a) create training attendance forms, and (b) store the training sign-up sheet. We calculate the costs of labor as one (1) employee spending 15 minutes (0.25 hours) to create the sign-up sheet during the first year and one (1) employee spending one (1) hour collecting and storing the attendance forms the first year and subsequent years. We assume that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation is $19.02 per hour, which we double to account for overhead and other indirect costs. We estimate the costs of documenting employee training would be $12.6 million in the first year ($19.02 × 2 × 1.25 × 266,297) and $10.1 million 437 This estimate is consistent with the 2016 Rule’s Regulatory Impact Analysis: ‘‘Of the 275,002 covered entities, approximately 15 percent employ more than 15 employees, resulting in approximately only slightly more than 41,250 covered entities being required to have grievance procedures and designate a responsible official.’’ 81 FR 31375, 31452 (May 18, 2016). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 in subsequent years ($19.02 × 2 × 1 × 266,297). Coverage for Gender-Affirming Care In addition to the cost some covered health insurance issuers and plans may incur for revising policies and procedures to comply with the rule, there is a possibility that such issuers and plans may incur a de minimis cost related to the cost of coverage for gender-affirming care. Various studies, however, suggest that any such increased costs will likely be negligible, and that any increases may be offset by savings from decreased utilization of other services. The likelihood of significant costs is low both because transgender individuals make up a very small percentage of the population and because many transgender individuals do not seek gender-affirming surgeries or other types of care.438 In April 2012, the California Department of Insurance conducted an Economic Impact Assessment on Gender Nondiscrimination in Health Insurance that found that prohibiting discrimination on the basis of gender identity in health insurance plans would have an ‘‘insignificant and immaterial’’ impact on costs.439 This conclusion was based on evidence of low utilization and the estimated number of transgender individuals in California. The transgender population of California was estimated to range between 0.0022 percent and 0.0173 percent.440 The study revealed that, contrary to common assumptions, not all transgender individuals seek surgical intervention, and that gender-affirming health care differs according to the needs and pre-existing conditions of each individual.441 Despite expecting a 438 See, e.g., U.S. Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Colorado 2023 EHBBenchmark Plan Actuarial Report, https:// www.cms.gov/CCIIO/Resources/Data-Resources/ ehb. Suite of Gender-affirming care benefits to treat gender dysphoria resulted cost estimate was 0.04 percent of the total allowed claims assuming utilization would be for adults. 439 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, p. 1 (Apr. 13, 2012), https:// translaw.wpengine.com/wp-content/uploads/2013/ 04/Economic-Impact-Assessment-GenderNondiscrimination-In-Health-Insurance.pdf. 440 Id. at p. 3. More recent estimates indicate that a higher share of the population in the United States identifies as transgender (0.6 percent of the U.S. adult population). Andrew R. Flores et al., The Williams Inst., UCLA Sch. of Law, Race and Ethnicity of Adults Who Identify as Transgender in the United States, p. 2 (2016), https:// williamsinstitute.law.ucla.edu/wp-content/uploads/ Race-Ethnicity-Trans-Adults-US-Oct-2016.pdf. 441 State of Cal., Dep’t of Ins., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, p. 8 (Apr. 13, 2012), https://translaw.wpengine.com/wpcontent/uploads/2013/04/Economic-Impact- PO 00000 Frm 00162 Fmt 4701 Sfmt 4700 possible spike in demand for benefits due to former or current unmet demand, the California Insurance Department concluded that any increased utilization that might occur over time is likely to be so low that any resulting costs remain actuarially immaterial.442 The Assessment notes the experience of one employer that initially established premium surcharges to cover the anticipated cost of gender-affirming care, reporting that the employer subsequently eliminated the surcharges because they found that the funds collected were nearly 15 times the amount expended on care.443 While it did not analyze any original data, a 2018 analysis by the State of Wisconsin’s Department of Employee Trust Funds cited numerous studies finding that the cost of coverage was minimal, and noted that ‘‘[w]hile it is challenging to predict the costs of care averted for any condition, there is some evidence that the costs associated with providing transgender-inclusive plans is met with reduced costs related to comorbidities.’’ 444 Other studies looking at both public and private sector plans have reached similar conclusions. One study published in the New England Journal of Medicine projected that the cost for providing genderaffirming care benefits to members of the military would result in an annual increase of 0.012 percent of health care costs, ‘‘little more than a rounding error in the military’s $47.8 billion annual health care budget.’’ 445 A 2013 study of 34 public and private sector employers that provided nondiscriminatory health care coverage found that providing coverage of gender-affirming care had ‘‘zero to very low costs.’’ 446 An Assessment-Gender-Nondiscrimination-In-HealthInsurance.pdf. 442 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, p. 9 (Apr. 13, 2012), https:// translaw.wpengine.com/wp-content/uploads/2013/ 04/Economic-Impact-Assessment-GenderNondiscrimination-In-Health-Insurance.pdf. 443 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, pp. 6–7 (Apr. 13, 2012), https:// translaw.wpengine.com/wp-content/uploads/2013/ 04/Economic-Impact-Assessment-GenderNondiscrimination-In-Health-Insurance.pdf. 444 Wis., Dep’t of Employee Trust Funds, Correspondence Memorandum Re: Transgender Services Coverage, pp. 6–8 (Aug. 14, 2018), https:// etf.wi.gov/boards/groupinsurance/2018/08/22/ item6a1/download?inline=. 445 Aaron Belkin, Caring for Our Transgender Troops—The Negligible Cost of Transition-Related Care, 373 New Eng. J. Med. 1089 (2015), https:// www.nejm.org/doi/pdf/10.1056/NEJMp 1509230?articleTools=true. 446 Jody Herman, The Williams Inst., UCLA Sch. of Law, Cost and Benefits of Providing TransitionRelated Health Care Coverage in Employee Health Benefits Plans: Findings from a Survey of Employers, p. 2 (Sept. 2013), https:// E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 additional study comparing costs and potential savings associated with covering gender-transition-related care concluded that ‘‘additional expenses hold good value for reducing the risk of negative endpoints—HIV, depression, suicidality, and drug abuse’’ and noted that ‘‘provider coverage was costeffective in 85 percent of simulations.’’ 447 More recently, a 2021 survey of employers conducted by the Human Rights Campaign noted that most employers who covered genderaffirming care reported only ‘‘marginal increases’’ in cost, on the order of ‘‘a fraction of a decimal point of cost calculations.’’ 448 In recent years, some legal challenges to coverage exclusions have also considered issues of cost and concluded that covering gender-affirming care does not significantly increase costs for plans. In discussing the parties’ experts on the issue of the cost, one court noted that, ‘‘[f]rom an actuarial perspective, there appears to be no dispute that the cost of coverage is immaterial.’’ 449 Another court reviewing expert testimony called any cost savings from excluding coverage for gender-affirming care ‘‘both practically and actuarially immaterial.’’ 450 Based on the studies discussed above, we estimate that providing transgender individuals nondiscriminatory insurance coverage and treatment would have a small impact on the overall cost of care and on health insurance premiums in terms of the percentage of overall spending. We reiterate that the final rule does not mandate the provision or coverage of genderaffirming care, or any particular health service. However, to the extent a covered entity provides coverage for a particular health service, the covered entity must provide the health service to all individuals in a neutral, nondiscriminatory manner consistent williamsinstitute.law.ucla.edu/wp-content/uploads/ Herman-Cost-Benefit-of-Trans-Health-BenefitsSept-2013.pdf. 447 William V. Padula et al., Societal Implications of Health Insurance Coverage for Medically Necessary Services in the U.S. Transgender Population: A Cost-Effectiveness Analysis, 31 J. of Gen. Internal Med. 394 (2015), https:// pubmed.ncbi.nlm.nih.gov/26481647/. 448 Hum. Rts. Campaign, Corporate Equality Index 2021 (2021), https://reports.hrc.org/corporateequality-index-2021?_ga=2.206988627.1166715317 .1639876655-819100514.1639876655. 449 Boyden v. Conlin, 341 F. Supp. 3d 979, 1000 (W.D. Wis. 2018). 450 Flack v. Wis. Dep’t of Health Servs., 395 F. Supp. 3d 1001, 1021 (W.D. Wis. 2019); see also Kadel v. Folwell, No. 1:19–cv–00272, 2022 WL 2106270, at *22 (finding that the cost of covering gender-affirming care ‘‘pales in comparison’’ to the Defendant state health plan’s overall cash balance and that excluding such coverage would only save each plan member’ ‘‘about one dollar each’’). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 with this rule. The utilization rate of covered services, whatever those services may be, is likely to be extremely low because transgender individuals represent a small minority in the general population and because not all transgender individuals will seek medical care in the course of their transition.451 As described in this section, the costs associated with gender-affirming care are likely to be small on a percentage basis of total health care costs; however, when these estimates are combined with measures of overall health care spending, they would likely result in incremental costs that could be substantial. As an initial estimate, we pair the Belkin (2015) estimate of 0.012 percent of incremental health care costs with $4,255.1 billion in total health expenditures in calendar year 2021.452 When this is grown to 2022 dollars, total health care costs are $4,550.0 billion. Combining these yields our upperbound estimate of $546 million in annual costs associated with additional coverage. As a lower-bound estimate, we adopt an assumption that these costs will be fully offset by reductions in spending on other medical care. This lower bound of $0 is broadly consistent with a cost-effectiveness analysis that includes the probability of negative incremental costs associated with coverage.453 For our primary estimate, we start with the midpoint of the lowerbound and upper-bound cost estimate of about $273.24 million annually. We reduce this figure by half to account for several factors, such as some covered entities already covering genderaffirming care under the baseline scenario. The coverage from § 92.207(b)(1) through (5) and (6) have delayed applicability dates of the first day of the first plan year beginning on or after January 1, 2025. Therefore, there is no cost from coverage in year 1 (2024). This results in a primary estimate of about $138 million per year starting in year 2 in incremental annual costs associated with additional coverage under the final rule, with a full 451 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, pp. 2, 5 (Apr. 13, 2012), https:// translaw.wpengine.com/wp-content/uploads/2013/ 04/Economic-Impact-Assessment-GenderNondiscrimination-In-Health-Insurance.pdf. 452 U.S. Dep’t of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Table 19. National Health Expenditure Accounts: Methodology Paper, 2022, https://www.cms.gov/files/document/ definitions-sources-and-methods.pdf. 453 William V. Padula et al., Societal Implications of Health Insurance Coverage for Medically Necessary Services in the U.S. Transgender Population: A Cost-Effectiveness Analysis, 31 J. of Gen. Internal Med. 394 (2015), https:// pubmed.ncbi.nlm.nih.gov/26481647/. PO 00000 Frm 00163 Fmt 4701 Sfmt 4700 37683 range of cost estimates including $0 million and $546 million. In addition, health plans and issuers could incur overall costs if total health care utilization increases as a result of this final rule. Any potential increase in costs as a result of increased health care utilization as a result of decreased discrimination could be passed on to beneficiaries in the form of increased premiums. However, this cost would be minimal due to the low utilization of gender affirming care along with the availability of the services. Assessing Decision Support Tools for Discrimination Section 92.210 sets a minimum requirement for each covered entity to make reasonable efforts to mitigate the risk of discrimination resulting from the covered entity’s use of a decision support tool. This will impose a cost on covered entities to review for potential discrimination in their decision support tools and to then make reasonable steps to mitigate the risk of discrimination. To estimate the cost of review, the Department assumes that all covered entities, or 266,297 entities, would on average take 1 hour to review decision support tools in year 1 and 0.5 hours in each year 2–5. The Department assumes the time burden is halved after year 1 because entities would only be reviewing new decision support tools or changes made to preexisting ones in the past year. Evidence suggests that larger entities, such as insurers, health systems and national labs, are more likely to use decision support tools while some types of entities may not use them at all.454 It is therefore likely that entities will have a large variance in time burden in practice as some entities will need to spend more time reviewing and others much less. OCR assumes that the hour of review consists of a 1557 coordinator (SOC code 43–4071) spending 0.5 hours coordinating a request for information on the potential for discrimination in decision support tools used by the covered entity and a Management Analyst (13–1111) or equivalent employee with knowledge of the decision support tools spending 0.5 hours responding to that request. After adjusting for fringe benefits and other indirect costs, the hourly wages for the Management Analyst and Section 1557 Coordinator come to $100.64 and $38.04 respectively. We monetize the time spent on reviewing decision support tools by estimating a total cost per entity 454 Xia Jing et al., Availability and Usage of Clinical Decision Support Systems (CDSSs) in Office-Based Primary Care Settings in the USA, BMJ Health Care Inform. (2019), https:// pubmed.ncbi.nlm.nih.gov/31818828. E:\FR\FM\06MYR4.SGM 06MYR4 37684 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations of $69.34 ($100.64 × 0.5 + $38.04 × 0.5). The estimated total cost to review decision support tools for all covered entities is $18,465,034 ($69.34 × 266,297) in year 1. In years 2–5, OCR estimates that the time burden will be half of what it was in year 1. This will lead to a total cost per entity of $34.67 ($100.64 × 0.25 + $38.04 × 0.25) in years 2–5. The estimated total cost to review decision support tools for all covered entities is $9,232,517 ($34.67 × 266,297) in each year 2–5. If an entity reviews their decision support tools and determines that there is no evidence that use of the tools may result in discriminatory outputs, then it is likely that no further action will be taken, and no additional cost will be incurred. If the entity determines that there is evidence that the decision support tools used by the covered entity could result in discriminatory outputs, then the entity will have to make reasonable mitigation steps to be in compliance with the final rule. OCR has determined that there are a large variety of actions that a covered entity can take to satisfy the requirements of the final rule and that these steps likely depend on the specific scenario. One aspect that will affect what a covered entity would do is if the decision support tool that is being used is a third-party product that the covered entity pays for or was developed and is owned by the covered entity itself. In the first scenario, the covered entity could notify the third party that the decision support tool may result in outputs that could be in violation of the rule, take mitigation steps in the use of the tool to ensure decisions made using that tool account for the potential for bias, or switch to a different product if the cost to do so is not prohibitive. If the covered entity maintains their own decision support tool, then they might take time to update the decision support tool, change policies and procedures about its use, or take other reasonable mitigation measures to ensure that it is not used in a discriminatory manner. The cost of all these actions may vary greatly, and OCR does not have data to assess what the costs may be. Generally, OCR assumes that larger entities, such as multihospital health systems and insurers will have a higher cost to resolve these issues since they are more likely to use decision support tools.455 In addition, OCR does not have data on how likely any given decision support tool is to be discriminatory and therefore necessitate taking reasonable mitigation steps. Due to these data limitations, OCR does not quantify the cost of taking reasonable mitigation steps. Exemption Requests We also identify a cost related to covered entities submitting a request for assurance of an exemption based on Federal conscience or religious freedom laws. We model this potential cost associated with exemption assurance requests as the time spent by covered entities to (a) assess the need for an exemption; (b) write the exemption assurance request; and (c) submit such a request to OCR. As an initial calculation, we assume that this would involve two (2) employees spending two (2) hours each assessing the need for an exemption and one employee spending three (3) hours writing and submitting the exemption assurance request to OCR. We further assume that legal personnel, including lawyers and legal assistants, would perform these functions. The mean hourly wage for these occupations is $70.55 per hour for each employee, which we double to account for overhead and other indirect costs. We multiply these factors together and estimate the cost per exemption request of $987.70 ($141.10 × 7 = $70.55 × 2 × 7). OCR has revised the estimate of the number of religious exemptions from the Proposed Rule RIA, which assumed 27 religious exemptions. OCR has increased this estimate to provide a more conservative estimate of the cost of religious exemptions, given significant uncertainty in the number of requests that will be submitted. OCR revises its assumptions to assume that 707 religious hospitals and 2 percent of all other covered entities will request assurance of religious exemptions. This results in a total of 6,019 of such requests (707 + ((266,297¥707) × 0.02)) in the first year. OCR estimates the cost to covered entities for the 6,019 of such requests as $5,944,792 (6,019 × $987.73). We estimate the cost to OCR comprising the time it would take to review the request and determine if the exemption assurance should be given. We estimate that it would take a single lawyer equivalent employee (Occupation code 23–1011), with a wage of $70.55 per hour, 3 hours to complete this review. We double the mean hourly wage to account for overhead and fringe benefits. OCR estimates the cost to review 6,019 assurance of exemption requests as $2,547,768 ($141.10 × 3 × 6,019). The total estimated cost of this process is $8,492,559. c. Total Quantified Costs Table 4 below presents the total annual costs anticipated under the final rule for which estimates have been developed. For the purposes of this analysis, we assume that the regulatory requirements begin to take effect in the middle of 2024. In the first year under the final rule, these estimated costs include $927.4 million in training, $8.5 million to process religious assurance of exemption requests, $18.5 million to review decision support tools, and $65.0 million to revise policies and procedures. For all years in the analysis, we estimate recurring costs of $46.6 million related to notices. We estimate a first-year cost of $37 million related to documentation, with ongoing costs in future years of $10.1 million. We also report a primary recurring cost estimate of $136.6 million associated with coverage of gender-affirming care starting in year 2 and $9.2 million in reviewing decision support tools starting in year 2. The total costs in year 1 amount to $1,102.9 million, with ongoing annual costs of $511.7 million in subsequent years. TABLE 4—PRIMARY ESTIMATE OF TOTAL ANNUAL COSTS [$ Millions, 2022 dollars] ddrumheller on DSK120RN23PROD with RULES4 Cost element 2024 Training .................................................................................................... Policies and Procedures .......................................................................... Notices ..................................................................................................... Documentation ......................................................................................... Gender-affirming Care Coverage ............................................................ 455 Robert. S. Rudin & Shira H. Fischer, Trends in the Use of Clinical Decision Support by Health System-Affiliated Ambulatory Clinics in the United VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 2025 $927.4 65.0 46.6 37.0 0 $309.1 0.0 46.6 10.1 136.6 States 2014–2016, Am. J. of Accountable Care (2019), https://www.ajmc.com/view/trends-in-theuse-of-clinical-decision-support-by-health-system- PO 00000 Frm 00164 Fmt 4701 Sfmt 4700 2026 $309.1 0.0 46.6 10.1 136.6 2027 $309.1 0.0 46.6 10.1 136.6 2028 $309.1 0.0 46.6 10.1 136.6 affiliated-ambulatory-clinics-in-the-united-states20142016. E:\FR\FM\06MYR4.SGM 06MYR4 37685 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations TABLE 4—PRIMARY ESTIMATE OF TOTAL ANNUAL COSTS—Continued [$ Millions, 2022 dollars] Cost element 2024 Assurance of Exemption Requests ......................................................... Decision Support Tool Review ................................................................ Total Costs * ...................................................................................... ddrumheller on DSK120RN23PROD with RULES4 This rulemaking also revises the Department’s interpretation of whether Medicare Part B payments constitute Federal financial assistance by answering that question in the affirmative. Thus, the requirements of section 1557 and other civil rights statutes apply to entities that receive payments through Medicare Part B. We are currently unable to quantify the number of covered entities that are enrolled in Medicare Part B but that receive no other forms of Federal financial assistance. The 2016 Rule discussed several of the challenges associated with estimating the number of these entities. For example, the 2016 Rule notes that, ‘‘although we have data, by program, for the number of physicians receiving payment from each program, there is no single, unduplicated count of physicians across multiple programs.’’ We adopt the finding of the 2016 Rule that almost all practicing physicians were likely covered by the rule because they accept Federal financial assistance from sources other than Medicare Part B.456 3. Discussion of Benefits Quantifying benefits for this final rule presents significant challenges. One notable challenge relates to attribution: several sources of benefits discussed in the preambles of the 2016 and 2020 Rules overlap with and may be attributable to prior existing civil rights regulation, to the ACA rather than the 2016 and 2020 rulemakings that implement section 1557, or to nondiscrimination policies based on State law or institutional policies prohibiting discrimination generally. A second challenge relates to identifying a quantitative relationship between nondiscrimination policies and important outcomes such as improvements in public health outcomes. For example, we anticipate that this regulation would reduce the incidence of providers refusing to treat patients based on the patient’s gender identity. This would result in fewer instances of delayed or denied care, which in turn would lead to reductions in mortality and morbidity risks. 456 81 FR 31375, 31445–46 (May 18, 2016). VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 2025 8.5 18.5 I 1,102.9 0.0 9.2 I 511.7 However, we are not able to estimate the changes in the magnitude of these discriminatory events that would be attributable to the final rule, and thus are unable to quantify or monetize these health improvements. Similarly, we anticipate that the final rule will result in other sources of benefits that we are unable to quantify. These include a reduction in suicidal ideation and attempts, improvements to mental health, reductions in substance use, and generally align with a discussion of the economic impacts of a California regulation relating to gender nondiscrimination in health insurance.457 In addition to these health improvements, we anticipate benefits to covered entities from additional regulatory clarity on how OCR will enforce the ACA’s nondiscrimination protections, particularly in light of ongoing litigation related to the 2020 Rule, interpretation of the Supreme Court’s Bostock decision, and the Department’s Bostock Notification. The training provisions represent one mechanism by which the final rule would reduce discriminatory events. This would, in turn, reduce the number of enforcement actions, representing a potential cost-saving benefit for covered entities. We also anticipate benefits to covered entities from the establishment of a grievance process, which would reduce the number of complaints filed with OCR, though this may be offset somewhat from covered entities with fewer than 15 employees referring complaints to OCR in lieu of adopting their own grievance procedure. We also anticipate that beneficiaries could benefit from reduced obstacles to accessing health care, including fewer language barriers and a reduction in discriminatory behavior related to sexual orientation and gender identity, resulting in a potential increase in overall health care utilization. These benefits relate to individuals’ ability to access care and the quality of care they 457 State of Cal., Dep’t of Ins., Economic Impact Assessment Gender Nondiscrimination in Health Insurance, pp. 9–11 (Apr. 13, 2012), https:// translaw.wpengine.com/wp-content/uploads/2013/ 04/Economic-Impact-Assessment-GenderNondiscrimination-In-Health-Insurance.pdf. PO 00000 Frm 00165 Fmt 4701 Sfmt 4700 2026 2027 0.0 9.2 I 511.7 2028 0.0 9.2 I 511.7 0.0 9.2 I 511.7 receive. For example, the provisions related to language access for individuals with LEP and accessibility for individuals with disabilities could reduce instances of negative outcomes, including death, due to a lack of understanding between patient and doctor or between patient and pharmacist, as well as lack of access to services. We also anticipate that the process by which individuals and recipients may seek assurance of an exemption based on Federal conscience or religious freedom laws will result in benefits from reduced litigation, which we do not capture in the benefit analysis. In addition, the prohibition on discrimination through the use of decision support tools is also likely to have a direct benefit on the health of individuals who are suffering from delayed or denied medical care due to discriminatory application of decision support tools. An example of this would be an incorrect diagnosis for skin cancer for a Black patient, which could lead to greater medical costs in the future and negative health outcomes for the patient.458 Furthermore, the positive effects of using decision support tools, such as identifying those at risk for cardiovascular disease at an earlier date, will be a benefit across populations experiencing discrimination.459 4. Analysis of Regulatory Alternatives to the Final Rule The Department considered various alternatives while developing this regulation, including adopting the compliance timeline of the Proposed Rule. As discussed in the preamble, the final rule will allow additional time for covered entities to comply with certain procedural requirements, as compared to the timeline of the Proposed Rule. For example, covered entities must comply with the § 92.9 Training requirements by no later than 300 days of effective 458 Thomas Grote & Geoff Keeling, On Algorithmic Fairness in Medical Practice, Cambridge Quarterly of Healthcare Ethics, January 2022. https://pubmed.ncbi.nlm.nih.gov/35049447/. 459 Rachel Gold et al., Effect of Clinical Decision Support at Community Health Centers on the Risk of Cardiovascular Disease: A Cluster Randomized Clinical Trial, JAMA Network Open (2022), https:// jamanetwork.com/journals/jamanetworkopen/ fullarticle/2788645. E:\FR\FM\06MYR4.SGM 06MYR4 37686 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations date. This revised timeline will postpone certain costs incurred by covered entities; however, since this analysis reports annual impacts, the revised timeline does not affect the quantified cost estimates. This section discusses several other alternatives OCR considered. The Department analyzed several regulatory alternatives to the final rule related to the notice requirements. The first alternative considered retaining the 2020 Rule’s repeal of the notices and taglines provisions. The Department considered concerns raised in response to the 2016 Rule notice and tagline requirements, as well as concerns raised in response to the removal of those requirements in the 2020 Rule. Though the Department acknowledges the burden placed on covered entities through the 2016 Rule notice requirements, the Department believes the 2020 Rule did not adequately consider the confusion and uncertainty placed on individuals or the unnecessary ambiguity that covered entities face by the 2020 Rule’s repeal of the notices and taglines provisions in their entirety. As described earlier, we estimate that these provisions under the final rule would cost covered entities, as an aggregate, $46.6 million for each year. While excluding the provisions relating to the notices would reduce the cost of the final rule by $46.6 million, the Department rejected this option because it believes that the final provisions strike an appropriate balance between providing greater access for beneficiaries, while maximizing efficiency and economies of scale for covered entities. The second alternative considered by the Department would require covered entities to provide notices only at their first encounter with a beneficiary. For this alternative, we adopt the quantity and cost estimates associated with eligibility and enrollment communication included in Table 5 above. Under our primary cost scenario, this policy alternative would result in annual costs of notices of $0.7 million, which is about $45.9 million lower than the final rule. The Department rejected this option however, because this policy alternative, while posing a significantly reduced cost and burden on covered entities, would be too narrow and substantially reduce the information available to beneficiaries, likely resulting in beneficiaries not being aware of their civil rights, including whether they have experienced a prohibited discriminatory practice by a covered entity. The third alternative considered by the Department would require a more expansive notice provision, extending the requirements to include pharmacyrelated notices. For this alternative, we adopt the 2020 RIA estimate of 3.2 billion annual pharmacy-related notices. This would result in $169.7 million in costs per year, or an increase of $123.1 million compared to the final rule. While this alternative related to notices would increase the number of notices available to beneficiaries, and therefore increase beneficiaries’ opportunity to receive information regarding nondiscrimination and civil rights protections, the Department believes this alternative would neither address nor remedy the burden placed on covered entities through the 2016 Rule notice requirements. For this reason, the Department rejected this alternative. Finally, the Department also considered not including a process for covered entities to submit a request for assurance of a religious or conscience exemption. As described in the cost section, we estimate that this policy alternative would reduce the quantified costs by $8.5 million. The Department did not choose this alternative because of its obligations to enforce a range of statutory protections, including Federal religious freedom and conscience laws. OCR remains committed to educating patients, providers, and other covered entities about their rights and obligations under these statutes, to protecting patients’ health and dignity, and to providing a clear administrative process that respects the right to raise objections to the provision of certain kinds of care. We have not quantified the benefits associated with this information for the final rule or for these policy alternatives. Table 5 reports the total costs of these policy alternatives in present value and annualized terms, adopting a 3 percent and 7 percent discount rate. Table 6 reports the difference between the total cost of the alternatives compared to the provisions of the final rule, using the same accounting methods and discount rates. All estimates are presented in millions of year-2022 dollars, using 2024 as the base year for discounting. TABLE 5—TOTAL COST OF POLICY ALTERNATIVES CONSIDERED [$ Millions, 2022 dollars] Present value Annualized Accounting method discount rate Final Rule ......................................................................................................... Alternative 1: No Notice Provision ................................................................... Alternative 2: Single Notice Provision ............................................................. Alternative 3: Pharmacy-Related Notices ........................................................ Alternative 4: No Exemption Provision ............................................................ 3% 7% 3% $2,917.6 2,704.1 2,707.4 3,481.3 2,909.4 $2,650.8 2,459.7 2,462.6 3,155.4 2,642.8 7% $637.1 590.5 591.2 760.1 635.3 $646.5 599.9 600.6 769.6 644.6 TABLE 6—COMPARISON OF ALTERNATIVES TO FINAL RULE [$ Millions, 2022 dollars] ddrumheller on DSK120RN23PROD with RULES4 Present value Annualized Accounting method discount rate Alternative Alternative Alternative Alternative 1: 2: 3: 4: VerDate Sep<11>2014 No Notice Provision ................................................................... Single Notice Provision ............................................................. Pharmacy-related Notices ......................................................... No Exemption Provision ............................................................ 21:44 May 03, 2024 Jkt 262001 PO 00000 Frm 00166 Fmt 4701 Sfmt 4700 3% 7% ¥$213.5 ¥210.2 563.7 ¥8.2 ¥$191.1 ¥188.2 504.6 ¥7.9 E:\FR\FM\06MYR4.SGM 3% 06MYR4 ¥$46.6 ¥45.9 123.1 ¥1.8 7% ¥$46.6 ¥45.9 123.1 ¥1.9 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations The Department also considered whether to require covered entities to collect the self-identified race, ethnicity, primary language (spoken and written), sex (consistent with the categories of sex discrimination described at § 92.101(a)(2)), age, and disability status data for beneficiaries in any health program or activity. The Department believes, however, that our current authorities under section 1557, title VI, section 504, title IX, and the Age Act already provide us the ability to collect these data to ensure compliance.460 ddrumheller on DSK120RN23PROD with RULES4 B. Regulatory Flexibility Act—Final Small Entity Analysis The RFA requires agencies issuing a regulation to analyze options for regulatory relief of small businesses if a rule will have a significant impact on a substantial number of small entities. The RFA generally defines a ‘‘small entity’’ as: (1) A proprietary firm meeting the size standards of the Small Business Administration (SBA); (2) A nonprofit organization that is not dominant in its field; or (3) A small government jurisdiction with a population of less than 50,000 (States and individuals are not included in the definition of ‘‘small entity’’). OCR uses as its measure of significant economic impact on a substantial number of small entities a change in revenues of more than 3 percent for 5 percent or more of affected small entities. In instances where OCR judged that the final rule would have a significant impact on a substantial number of small entities, we considered alternatives to reduce the burden. To accomplish our task, we first identified all the small entities that may be impacted, and then evaluated whether the economic burden we determined in the RIA represents a significant economic impact. 1. Entities That Will Be Affected OCR has traditionally classified most providers as small entities even though some nonprofit providers would not meet the definition of ‘‘small entity’’ were they proprietary firms. Nonprofit entities are small if they are independently owned and operated and are not dominant in their fields. The CMS Provider of Service file has indicators for profit and nonprofit entities, but these have proven to be unreliable. The Census data identifies firms’ tax status by profit and non-profit status but only reports revenues and does not report them by the profit and non-profit status of the entity. 460 See, e.g., 45 CFR 80.6, 86.71, 91.34, and 84.61. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 a. Physicians One class of providers we do not automatically classify as small businesses is physician practices. Physician practices are businesses and therefore are ‘‘small’’ if they meet the SBA’s definition. The current size standard for physicians (excluding mental health specialists) (North American Industry Classification System code 62111) is annual receipts of less than $16 million.461 Using the Census data showing the number of firms, employees and payroll, we selected physicians that reported fewer than 20 employees as the top end for small physician offices. This equaled 16,361 entities or 9.8 percent of all physician offices defined as ‘‘large.’’ This left 150,933 offices or 90.2 percent as ‘‘small.’’ 462 b. Pharmacies Pharmacies also are businesses, and the size standard for them is annual receipts of less than $37.5 million. According to Census Statistics of U.S. Businesses, there are 19,346 pharmacy and drug store firms (North American Industry Classification System code 456110). Because of the lack of revenue or receipt data for pharmacies, we are unable to estimate the number of small pharmacies based on the SBA size standard. However, using the number of employees taken from the Statistics of U.S. Businesses as a proxy for revenues, the data is divided by number of employees per firm and shows the number of employers with fewer than 20 employees and those with more than 20 employees.463 There are 17,160 pharmacy firms with fewer than 20 employees, representing 88.7 percent of the total number of pharmacy firms. It seemed reasonable to assume that firms with fewer than 20 employees satisfy the SBA size standard and thus we accepted that the number of small pharmacy firms equaled 17,160. As with the number of small physician offices, our method can only identify the minimum number of ‘‘small’’ pharmacies that meet the SBA size 461 U.S. Small Business Admin., Table of Small Business Size Standards Matched to North American Industry Classification System Codes, Small Business Administration (March 2023), https://www.sba.gov/document/support-table-sizestandards. 462 Physician practices may earn more than $16 million per year and that would increase the number of ‘‘large’’ practices in the analysis. But as we will later show, large practices will have proportionally larger workforce staff that must be excluded from the analysis. 463 U.S. Census Bureau, Statistics of U.S. Businesses, https://www.census.gov/programssurveys/susb.html. PO 00000 Frm 00167 Fmt 4701 Sfmt 4700 37687 standard. We cannot determine the actual number of ‘‘small’’ pharmacies. c. Health Insurance Issuers Another class of covered entities that are business enterprises is health insurance issuers. The SBA size standard for health insurance issuers is annual receipts of $47 million. Based on the analysis below, we conclude that there are few small health insurance issuers. In 2021, there were 483 issuers in the U.S. health insurance market.464 Health insurance issuers are generally classified under the North American Industry Classification System (NAICS) code 524114 (Direct Health and Medical Insurance Carriers). According to SBA size standards,465 entities with average annual receipts of $47 million or less are considered small entities for this NAICS code. The Departments expect that few, if any, insurance companies underwriting health insurance policies fall below these size thresholds. Due to the lack of recent Census data based on enterprise receipt size, HHS used the Census 2017 SUSB data as a proxy since it was the last year in which this data is available. Based on data from SUSB annual report submissions for the 2017 SUSB reporting year, approximately 443 out of 745 issuers of health insurance coverage nationwide, approximately 59.46%, had total premium revenue of $40.0 million or less.466 OCR decided to use a value slightly higher than the 2017 SBA standard to account for slight changes in the industry in addition to inflation. We then apply this percentage to the current number of insurance Issuers to estimate the number of small entities for the business type, which is approximately 517 of 869 entities. However, this estimate may overstate the actual number of small health insurance issuers that may be affected due to changes in the health care industry since 2017. To produce a conservative estimate, for the purposes of this analysis, the Departments assumes 59.5 percent, or 517 issuers are considered small entities. d. Local Government Entities We also excluded local governmental entities from our count of small entities 464 U.S. Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs. (2022), Medical Loss Ratio Data and System Resources, https://www.cms.gov/CCIIO/ Resources/Data-Resources/mlr. 465 U.S. Small Business Admin., Table of Size Standards (March 17, 2023), https://www.sba.gov/ document/support--table-size-standards. 466 U.S. Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medical Loss Ratio Data and System Resources (2017), https://www.cms.gov/ marketplace/resources/data/medical-loss-ratiodata-systems-resources. E:\FR\FM\06MYR4.SGM 06MYR4 37688 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations because we lack the data to classify them by populations of fewer than 50,000. The following table shows the number of small, covered entities we estimated could be affected by the final rule. TABLE 8—SMALL ENTITIES Business type 62142 ..................... 621491 ................... 621492 ................... 621493 ................... 621498 ................... 6215 ....................... 6216 ....................... 6219 ....................... 62321 ..................... 6221 ....................... 6222 ....................... 6223 ....................... 6231 ....................... 45611 ..................... 6211 ....................... 524114 ................... Outpatient mental health and substance abuse centers ................................................................................ HMO medical centers ...................................................................................................................................... Kidney dialysis centers ................................................................................................................................... Freestanding ambulatory surgical and emergency centers ............................................................................ All other outpatient care centers ..................................................................................................................... Medical and diagnostic laboratories ................................................................................................................ Home health care services ............................................................................................................................. All other ambulatory health care services ....................................................................................................... Residential intellectual and developmental disability facilities ........................................................................ General medical and surgical hospitals .......................................................................................................... Psychiatric and substance abuse hospitals .................................................................................................... Specialty (except psychiatric and substance abuse) hospitals ...................................................................... Nursing care facilities (skilled nursing facilities) ............................................................................................. Pharmacies and drug stores ........................................................................................................................... Offices of physicians ....................................................................................................................................... Insurance Issuers ............................................................................................................................................ Navigator grantees .......................................................................................................................................... 7,649 84 449 4,554 6,307 7,200 25,718 7,091 6,674 2,445 434 301 9,824 17,160 150,933 517 58 Total Entities ............................................................................................................................................ 247,398 2. Whether the Rule Will Have a Significant Economic Impact on Covered Small Entities ddrumheller on DSK120RN23PROD with RULES4 Small entities NAICS code The Department generally considers a rule to have a significant impact on a substantial number of small entities if it has at least a 3 percent impact on revenue on at least 5 percent of small entities. We performed a threshold analysis to determine whether the quantified impacts of the final rule will exceed these thresholds. As described earlier in this analysis, we estimate the total annualized costs of the final rule would be about $637.1 million. Dividing these total costs by the 247,398 small entities gives a cost per entity of $2,575. This cost estimate would only exceed the 3 percent ‘‘significant impact’’ threshold on revenue for any covered small businesses with revenue below $85,836. We conclude that very few small businesses covered by the final rule will have revenues below $85,836, and that this number is very likely to be smaller than the 5 percent ‘‘substantial number’’ threshold. As an additional consideration, we note that the costs of the final rule are mostly proportional to the size of the covered entity. For example, the costs associated with training, which account for more than 70 percent of the total costs of the final rule, are mostly proportional to the number of employees receiving training. In the main analysis, we estimate an incremental impact of one (1) hour per employee trained. The opportunity cost of training each employee represents 0.05 percent of a full-time employee’s VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 annual labor productivity, assuming a full-time employee works 2,080 hours per year.467 This finding, that the cost of training represents 0.05 percent of the share of employees receiving training, is constant across firm size. Because the costs of the final rule are small relative to the revenue of covered entities, including covered small entities, and because even the smallest affected entities would be unlikely to face a significant impact, we certify that the final rule will not have a significant economic impact on a substantial number of small entities. C. Executive Order 12250 on Leadership and Coordination of Nondiscrimination Laws Pursuant to E.O. 12250, the Department of Justice has the responsibility to ‘‘review . . . proposed rules . . . of the Executive agencies’’ implementing nondiscrimination statutes such as section 1557 ‘‘in order to identify those which are inadequate, unclear or unnecessarily inconsistent.’’The Department of Justice has reviewed and approved this final rule. D. Paperwork Reduction Act Information Collection Requirements This final rule contains information collection requirements (ICRs) that are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA) of 467 40 hours per week × 52 weeks = 2,080 hours. 0.05% = 0.0005 = 1 hour ÷ 2080 hours. PO 00000 Frm 00168 Fmt 4701 Sfmt 4700 1995.468 In order to evaluate whether an information collection should be approved by OMB, the PRA requires that the Department solicits comment on the following issues: 1. Whether the information collection is necessary and useful to carry out the proper functions of the agency; 2. The accuracy of the agency’s estimate of the information collection burden; 3. The quality, utility, and clarity of the information to be collected; and 4. Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.469 The PRA requires consideration of the time, effort, and financial resources necessary to meet the information collection requirements referenced in this section. The Department previously published a notice of a proposed data collection on August 4, 2022, at 87 FR 47907–08, as part of an NPRM entitled ‘‘Nondiscrimination in Health Programs and Activities’’ (RIN 0945–AA17), to invite public comment. OCR solicited comment on the issues listed above for the sections that contain ICRs. The following paragraphs describe these provisions, with an estimate of the annual burden, summarized in Table 1. OCR did not receive comments related to the previous notice but has adjusted the estimated respondent burden in this request to reflect revised assumptions based on updated information available at the time of the final rule’s 468 44 469 44 E:\FR\FM\06MYR4.SGM U.S.C. 3501–3520. U.S.C. 3506(c)(2)(A). 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations publication. This revision resulted in adjusted cost estimates that are consistent with the RIA presented in this final rule. The estimates covered the employees’ time for reviewing and completing the collections required. Consistent with the NPRM, the collections of information proposed by this final rule relate to §§ 92.5 (Assurances required); 92.7 (Designation and responsibilities of a Section 1557 Coordinator); 92.9 (Training); 92.10 (Notice of nondiscrimination); and 92.11 (Notice of availability of language assistance services and auxiliary aids and services). Respondents to this proposed information collection would include a variety of covered entities with a health program or activity including hospitals, ambulatory surgical centers, skilled nursing facilities, and physicians’ offices. For a more detailed discussion concerning the potential costs’ implications related to these collections of information, please see the Regulatory Impact Analysis. ddrumheller on DSK120RN23PROD with RULES4 1. ICRs Regarding Assurances (§ 92.5) Section 92.5 retains the assurances obligations from the 2016 and 2020 Rules for covered entities to submit an assurance of compliance to the Department. As stated in the NPRM, OCR has previously obtained PRA approval (OMB control # 0945–0008) for this reporting requirement via an update to HHS Form 690 (Consolidated Civil Rights Assurance Form), separate from this rulemaking. The requirement to sign and submit an assurance of compliance currently exists under section 1557 and other civil rights regulations (title VI, section 504, title IX, and the Age Act). Since the Department provides an online portal through which covered entities submit attestation of Assurance of Compliance, the Department has determined that this requirement imposes no additional reporting or recordkeeping requirements under the PRA. OCR did not receive any comments in response to the ICRs related to this policy. Please see the prior preamble discussion for our responses to the general comments related to this provision. OCR is finalizing this ICR as proposed. 2. ICRs Regarding Section 1557 Coordinator (§ 92.7) and Training (§ 92.9) Section 92.7 requires covered entities with 15 or more employees designate a section 1557 Coordinator to coordinate their efforts to comply with and carry out their responsibilities under section 1557. The burden to coordinate efforts to comply with and carry out the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 responsibilities under section 1557 was estimated in the NPRM, at an annualized burden of 10 hours per covered entity to store complaints and the associated records required under § 92.8(c)(2) each year. We assumed that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation was $17.38 per hour, which we double to account for overhead and other indirect costs. In the 2022 NPRM, OCR estimated the number of covered entities with more than 15 employees to be approximately 15 percent or 41,250. Although in the 2022 NPRM, OCR estimated that the costs of retaining records related to grievances filed at all covered entities would be $14.3 million annually (($17.38 × 2) × 10 × 41,250), we noted that this estimation approach may overstate the costs if many covered entities already retain complaint information. OCR has adjusted our estimated respondent burden in this request to reflect baseline conditions based on updated information available at the time of the final rule’s publication. No changes were made to estimated personnel or staff time or to the assumption that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation, however, has increased to $19.02 per hour, which we double to account for overhead and other indirect costs. The Department estimates the number of covered entities with more than 15 employees to be approximately 15 percent or 63,950. Although we estimate the costs of retaining records related to grievances filed at all covered entities would be $24.3 million annually (($19.02 × 2) × 10 × 63,950)), this estimation approach will overstate the costs if many covered entities already retain complaint information. The burden for documenting employee training as required under § 92.9(c) is the cost of covered entity staff time to (a) create training attendance forms; and (b) store the training sign-up sheet. The labor cost would include one (1) employee spending 15 minutes (0.25 hours) to create the sign-up sheet during the first year and one (1) employee spending one (1) hour collecting and storing the attendance forms the first year and in subsequent years. In the NPRM, we estimated that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation was $17.38 per hour. The labor cost was $6.0 million in the first year (($17.38 × 1.25) × 275,002 covered entities). In the 2022 NPRM, we PO 00000 Frm 00169 Fmt 4701 Sfmt 4700 37689 estimated that the cost in subsequent years would be $4.8 million, which would represent an annual allotment of one (1) hour (($17.38 × 1) × 275,002 covered entities). OCR has adjusted our estimated respondent burden in this request to reflect updated baseline conditions based on updated information not available at the time of the publication of the NPRM. No changes were made to the estimated personnel or staff time or to the estimate that administrative or clerical support personnel would perform these functions. The mean hourly wage for this occupation, however, increased to $19.02 per hour. The estimated labor cost of documenting employee training would be $12.6 million in the first year (($19.02 × 2) × 1.25 × 266,297 covered entities). We estimate that the cost in subsequent years would be $10.1 million, which would represent an annual allotment of one (1) hour ((($19.02 × 2) × 1) × 266,297 covered entities). OCR did not receive any comments in response to the ICRs related to this policy. Please see the prior preamble discussion for our responses to the general comments related to this provision. OCR is finalizing these ICRs as proposed. 3. ICRs Regarding Notice of Nondiscrimination (§ 92.10) and Notice of Availability of Language Assistance Services and Auxiliary Aids and Services (§ 92.11) Under §§ 92.10 and 92.11, OCR requires covered entities to notify the public of their nondiscrimination requirements, as well as the availability of language assistance services and auxiliary aids and services. Section 92.10 requires covered entities to provide a Notice of Nondiscrimination relating to its heath programs or activities to beneficiaries of its health programs and activities and members of the public. To minimize the burden on covered entities, the provision proposes a covered entity may combine the content of the notice required by this section with the notice required by title VI, section 504, title IX, and the Age Act implementing regulations. Section 92.11 requires covered entities to notify the public of their nondiscrimination requirements, as well as the availability of language assistance services and auxiliary aids and services. A covered entity must provide a Notice of Availability that, at minimum, states that the covered entity provides language assistance services and auxiliary aids and services free of charge E:\FR\FM\06MYR4.SGM 06MYR4 37690 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations in its health programs and activities, in compliance with section 1557. This notice must be provided to beneficiaries of the covered entity’s health program or activity and members of the public. The notice must be provided in English and at least the top 15 languages spoken by persons with LEP of the relevant State or States in which a covered entity operates (including territories) and must be provided in alternate formats for individuals who request auxiliary aids and services to ensure effective communication. OCR also received comments on the cost of Notices of Nondiscrimination and Notices of Availability (referred to as ‘‘taglines’’ in the 2016 and 2020 Rules). One commenter explained how the cost of including taglines averages up to $8.91 per month per covered entity and upwards of $2 million a year for the health insurance industry. Another commenter stated that they have spent over $16 million on notices and taglines since 2016, and estimate that they have spent over $3 million in 2022 alone. As we noted in the RIA, neither commenter provided sources for their data nor additional detail on their cost estimates. Another commenter noted that previous complaints on the frequency and volume of materials related to the notice and tagline sections of the rule were not addressed, but no data were provided with their comment. Based on costs estimated in the RIA, OCR derives a monthly cost of Notices of Nondiscrimination and Notices of Availability from $21.28 and $26.60 per entity depending on the prevalence of electronic delivery. These cost estimates include the total Notices of Nondiscrimination and Notices of Availability and therefore OCR finds the commenter’s estimate of $8.91 per month for Notices of Availability as plausible and consistent with the estimates in the RIA. OCR also notes that these cost estimates are averages. It is expected that some entities, including larger entities, may have higher than average costs due to the increased number of notices they would send to individuals. Both types of notices are required (1) on an annual basis; (2) upon request; (3) at a conspicuous location on the homepage of the covered entity’s health program or activity website; and (4) at conspicuous physical locations where the health program or activity interacts with the public. In the NPRM, OCR estimated the burden for responding to the proposed notice requirements would be 34 minutes and that administrative or clerical support personnel would perform these functions. Because it was difficult to determine the exact number of communications that would be required to contain the notices anticipated under the 2022 NPRM, our cost estimates reflected a wide range of uncertainty in the cost. In the 2022 NPRM, the Department estimated an adjusted annual primary cost total of $4.5 million, with a range of costs between $2.7 million and $25.0 million. These costs would occur in each year of the time horizon of the analysis. OCR has adjusted our estimated respondent burden in this request to reflect updated baseline conditions based on updated information not available at the time of the publication of the NPRM. Because it is difficult to determine the exact number of communications that would be required to contain the notices anticipated under the 2022 NPRM, our cost estimates reflect a wide range of uncertainty in the cost. OCR notes that the majority of associated costs for these requirements are from the materials, such as paper and ink, used in the notices and these costs are assumed to vary with the length of notices. No changes were made to the estimate that administrative or clerical support personnel would perform these functions. The estimated personnel and staff time, however, increased to 1.34 hours per year to perform these functions. The mean hourly wage for this occupation increased to $19.02 per hour, which we double to account for overhead and other indirect costs. The estimated labor cost to notify the public of their nondiscrimination requirements, as well as availability of language assistance services and auxiliary aids and services, would be $13.5 million (($19.02 × 2) × 1.34) × 266,297 covered entities). The Department estimates the total associated costs for these requirements as an adjusted annual total of $53.2 million, with a range of costs between $35.5 million and $292.6 million. These costs would occur in each year of the time horizon of the analysis. OCR did not receive any comments in response to the ICRs related to § 92.10, and received the comments discussed above in response to ICRs related to § 92.11. Please see the prior preamble discussion for our responses to the general comments related to this provision. OCR is finalizing the ICRs for §§ 92.10 and 92.11 as proposed. We have submitted a copy of this final rule to OMB for its review of the rule’s ICRs. These requirements are not effective until they have been approved by OMB. TABLE 1—SUMMARY OF ESTIMATED ANNUALIZED BURDEN Number of respondents Information collection Burden hours per response (average) Total responses Hourly rate Coordination Efforts ................................................... 471 63,950/ 1 330,247 472 10/1.25 473 $38.04 §§ 92.10 & 92.11 Notice ....................................................... Total application collection ...................................................... 266,297 266,297 330,247 474 1 ........................ 266,297 596,544 1.34 12.59 38.04 ........................ § 92.7 ddrumheller on DSK120RN23PROD with RULES4 Responses frequency (average) 470 The figures in this column are averages based on a range. Large entities with more than 15 employees may require more hours than those provided here due to their size and complexity, while small entities may require fewer hours to conduct certain compliance activities. 471 Covered entities with 15 or more employees would be required to coordinate the retention of grievance complaints for no less than three years. We have estimated that this provision would apply to approximately 63,950 covered entities. All VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 covered entities would be required to document employee training on section 1557. We estimated that this would apply to approximately 266,297 covered entities. 472 We have estimated that covered entities with 15 or more employees would spend approximately 10 hours on efforts to coordinate their compliance efforts under section 1557 as required under § 92.7. We estimate that all covered entities would spend approximately 1.25 hours documenting employee training as required under § 92.9. PO 00000 Frm 00170 Fmt 4701 Sfmt 4700 Burden cost 470 $24,326,580/ 12,662,422 13,574,117 50,563,119 473 The $38.04 wage, which includes $19.02 plus 100 percent for benefits, applies to the category ‘‘Administrative or Clerical Support Personnel.’’ 474 Because it is difficult to determine the exact number of communications which would be required to contain the notices anticipated under the Proposed Rule, our number of responses per respondent estimate reflects this uncertainty. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations E. Assessment of Federal Regulation and Policies on Families Section 654 of the Treasury and General Government Appropriations Act of 1999 requires Federal departments and agencies to determine whether a proposed policy or regulation could affect family well-being. If the determination is affirmative, then the Department or agency must prepare an impact assessment to address criteria specified in the law. The final rule would not negatively affect family wellbeing and would strengthen the stability of the family by promoting the ability of all individuals and families to receive health care free from discrimination. As research demonstrates that experiencing discrimination can have a negative impact on health and wellbeing, this rule addresses the immediate and longterm effects of discriminatory actions and establishes a set of practices to remove barriers to accessing care among entities that receive Federal funds. Addressing and preventing discrimination in health care can also improve the financial stability of the family unit by increasing access to nondiscriminatory health insurance coverage and other health-related coverage, aiding parents in their ability to provide for and nurture their children. The rule may be carried out only by the Federal Government because it would implement Federal nondiscrimination law, ensuring that American families have access to health care information and services, regardless of the State where they are located. List of Subjects 42 CFR Part 438 Citizenship and naturalization, Civil rights, Grant programs-health, Individuals with disabilities Medicaid, Reporting and recordkeeping requirements, Sex discrimination. 42 CFR Part 440 Citizenship and naturalization, Civil rights, Grant programs-health, Individuals with disabilities, Medicaid, Sex discrimination. ddrumheller on DSK120RN23PROD with RULES4 42 CFR Part 457 Administrative practice and procedure, Grant programs-health, Health insurance, Reporting and recordkeeping requirements. 42 CFR Part 460 Aged, Citizenship and naturalization, Civil rights, Health, Health care, Health records, Individuals with disabilities, VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Medicaid, Medicare, Religious discrimination, Reporting and recordkeeping requirements, Sex discrimination. 45 CFR Part 80 Civil rights, Individuals with disabilities, Sex discrimination, Vocational education. 45 CFR Part 84 Civil rights, Equal educational opportunity, Equal employment opportunity, Health care, Individuals with disabilities, Infants and children, Reporting and recordkeeping requirements. 45 CFR Part 92 45 CFR Part 147 Aged, Citizenship and naturalization, Civil rights, Health care, Health insurance, Individuals with disabilities, Intergovernmental relations, Reporting and recordkeeping requirements, Sex discrimination. 45 CFR Part 155 Administrative practice and procedure, Advertising, Aged, Brokers, Citizenship and naturalization, Civil rights, Conflict of interests, Consumer protection, Grant programs-health, Grants administration, Health care, Health insurance, Health maintenance organizations (HMO), Health records, Hospitals, Indians, Individuals with disabilities, Intergovernmental relations, Loan programs-health, Medicaid, Organization and functions (Government agencies), Public assistance programs, Reporting and recordkeeping requirements, Sex discrimination, State and local governments, Taxes, Technical assistance, Women, Youth. 45 CFR Part 156 Administrative practice and procedure, Advertising, Advisory committees, Brokers, Conflict of interests, Consumer protection, Grant programs-health, Grants administration, Health care, Health insurance, Health maintenance organization (HMO), Health records, Hospitals, Indians, Individuals with disabilities, Loan programs-health, Medicaid, Organization and functions Frm 00171 Fmt 4701 (Government agencies), Public assistance programs, Reporting and recordkeeping requirements, State and local governments, Sunshine Act, Technical assistance, Women, Youth. Dated: April 18, 2024. Xavier Becerra, Secretary, Department of Health and Human Services. For the reasons set forth in the preamble, the Department of Health and Human Services amends 42 CFR parts 438, 440, 457, and 460 and 45 CFR parts 80, 84, 92, 147, 155, and 156 as follows: Title 42—Public Health PART 438—MANAGED CARE Administrative practice and procedure, Aged, Citizenship and naturalization, Civil rights, Communications equipment, Health facilities, Health insurance, Health programs or activities, Healthcare, Individuals with disabilities, Reporting and recordkeeping requirements, Sex discrimination. PO 00000 37691 Sfmt 4700 1. The authority citation for part 438 continues to read as follows: ■ Authority: 42 U.S.C. 1302. 2. Amend § 438.3 by revising paragraph (d)(4) to read as follows: ■ § 438.3 Standard contract requirements. * * * * * (d) * * * (4) The MCO, PIHP, PAHP, PCCM or PCCM entity will not discriminate against individuals eligible to enroll on the basis of race; color; national origin; disability; or sex which includes sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes; and will not use any policy or practice that has the effect of discriminating on the basis of race; color; national origin; disability; or sex which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. * * * * * 3. Amend § 438.206 by revising paragraph (c)(2) to read as follows: ■ § 438.206 Availability of services. * * * * * (c) * * * (2) Access and cultural considerations. Each MCO, PIHP, and PAHP participates in the State’s efforts to promote the delivery of services in a culturally competent manner to all enrollees, including those with limited English proficiency and diverse cultural and ethnic backgrounds, disabilities, and regardless of sex which includes sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity and sex stereotypes. * * * * * E:\FR\FM\06MYR4.SGM 06MYR4 37692 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations 10. Amend § 460.112 by revising paragraph (a) introductory text to read as follows: ■ PART 440—SERVICES: GENERAL PROVISIONS 4. The authority citation for part 440 continues to read as follows: ■ § 460.112 Specific rights to which a participant is entitled. Authority: 42 U.S.C. 1302. ■ 5. Revise § 440.262 to read as follows: § 440.262 Access and cultural conditions. The State must have methods to promote access and delivery of services in a culturally competent manner to all beneficiaries, including those with limited English proficiency, diverse cultural and ethnic backgrounds, disabilities, and regardless of sex which includes sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes. These methods must ensure that beneficiaries have access to covered services that are delivered in a manner that meets their individualized needs. Title 45—Public Welfare PART 457—ALLOTMENTS AND GRANTS TO STATES PART 80—NONDISCRIMINATION UNDER PROGRAMS RECEIVING FEDERAL ASSISTANCE THROUGH THE DEPARTMENT OF HEALTH AND HUMAN SERVICES EFFECTUATION OF TITLE VI OF THE CIVIL RIGHTS ACT OF 1964 6. The authority citation for part 457 continues to read as follows: ■ Authority: 42 U.S.C. 1302. 7. Amend § 457.495 by adding paragraph (e) to read as follows: ■ § 457.495 State assurance of access to care and procedures to assure quality and appropriateness of care. * * * * * (e) Access to and delivery of services in a culturally competent manner to all beneficiaries, as described in 42 CFR 440.262. PART 460—PROGRAMS OF ALLINCLUSIVE CARE FOR THE ELDERLY (PACE) 8. The authority citation for part 460 continues to read as follows: ■ 9. Amend § 460.98 by revising paragraph (b)(3) to read as follows: ddrumheller on DSK120RN23PROD with RULES4 * * * * (b) * * * (3) The PACE organization shall not discriminate against any participant in the delivery of required PACE services based on race, ethnicity, national origin, religion, sex (including sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes), age, mental or physical disability, or source of payment. * * * * * 21:44 May 03, 2024 Jkt 262001 12. Amend appendix A to part 80 under part 1 by adding entry 155 in numerical order to read as follows: ■ Appendix A to Part 80—Federal Financial Assistance To Which These Regulations Apply Part 1. Assistance Other Than Continuing Assistance to States * Service delivery. VerDate Sep<11>2014 Authority: Sec. 602, 78 Stat. 252; 42 U.S.C. 2000d–1. * * * * 155. Supplementary medical insurance benefits for the aged (Title XVIII, Part B, Social Security Act, 42 U.S.C. 1395j–1395w– 6). ■ * 11. The authority citation for part 80 continues to read as follows: ■ * Authority: 42 U.S.C. 1302, 1395, 1395eee(f), and 1396u–4(f). § 460.98 (a) Respect and nondiscrimination. Each participant has the right to considerate, respectful care from all PACE employees and contractors at all times and under all circumstances. Each participant has the right not to be discriminated against in the delivery of required PACE services based on race, ethnicity, national origin, religion, sex (including sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes), age, mental or physical disability, or source of payment. Specifically, each participant has the right to the following: * * * * * * * * * PART 84—NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE 13. The authority citation for part 84 continues to read as follows: ■ Authority: 20 U.S.C. 1405; 29 U.S.C. 794; 42 U.S.C. 290dd–2; 21 U.S.C. 1174. 14. Amend appendix A to part 84 in subpart a, under Definitions, by revising section 2 to read as follows: ■ PO 00000 Frm 00172 Fmt 4701 Sfmt 4700 Appendix A to Part 84—Analysis of Final Regulation Subpart A—General Provisions Definitions * * * 2. ‘‘Federal financial assistance’’. In § 84.3(h), defining Federal financial assistance, a clarifying change has been made: procurement contracts are specifically excluded. They are covered, however, by the Department of Labor’s regulation under section 503. The Department has never considered such contracts to be contracts of assistance; the explicit exemption has been added only to avoid possible confusion. The proposed regulation’s exemption of contracts of insurance or guaranty has been retained. A number of comments argued for its deletion on the ground that section 504, unlike title VI and title IX, contains no statutory exemption for such contracts. There is no indication, however, in the legislative history of the Rehabilitation Act of 1973 or of the amendments to that Act in 1974, that Congress intended section 504 to have a broader application, in terms of Federal financial assistance, than other civil rights statutes. Indeed, Congress directed that section 504 be implemented in the same manner as titles VI and IX. In view of the long established exemption of contracts of insurance or guaranty under title VI, we think it unlikely that Congress intended section 504 to apply to such contracts. * ■ * * * * 15. Revise part 92 to read as follows: PART 92—NONDISCRIMINATION IN HEALTH PROGRAMS OR ACTIVITIES Subpart A—General Provisions Sec. 92.1 Purpose and effective date. 92.2 Application. 92.3 Relationship to other laws. 92.4 Definitions. 92.5 Assurances required. 92.6 Remedial action and voluntary action. 92.7 Designation and responsibilities of a Section 1557 Coordinator. 92.8 Policies and procedures. 92.9 Training. 92.10 Notice of nondiscrimination. 92.11 Notice of availability of language assistance services and auxiliary aids and services. Subpart B—Nondiscrimination Provisions 92.101 Discrimination prohibited. Subpart C—Specific Applications to Health Programs and Activities 92.201 Meaningful access for individuals with limited English proficiency. 92.202 Effective communication for individuals with disabilities. 92.203 Accessibility for buildings and facilities. 92.204 Accessibility of information and communication technology for individuals with disabilities. 92.205 Requirement to make reasonable modifications. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations 92.206 Equal program access on the basis of sex. 92.207 Nondiscrimination in health insurance coverage and other healthrelated coverage. 92.208 Prohibition on sex discrimination related to marital, parental, or family status. 92.209 Nondiscrimination on the basis of association. 92.210 Nondiscrimination in the use of patient care decision support tools. 92.211 Nondiscrimination in the delivery of health programs and activities through telehealth services. Subpart D—Procedures 92.301 Enforcement mechanisms. 92.302 Notification of views regarding application of Federal religious freedom and conscience laws. 92.303 Procedures for health programs and activities conducted by recipients and State Exchanges. 92.304 Procedures for health programs and activities administered by the Department. Authority: 42 U.S.C. 18116. PART 92—NONDISCRIMINATION IN HEALTH PROGRAMS OR ACTIVITIES Subpart A—General Provisions § 92.1 Purpose and effective date. (a) Purpose. The purpose of this part is to implement section 1557 of the Patient Protection and Affordable Care Act (ACA) (42 U.S.C. 18116), which prohibits discrimination on the basis of race, color, national origin, sex, age, and disability in certain health programs and activities. Section 1557 provides that, except as otherwise provided in title I of the ACA, an individual shall not, on the grounds prohibited under title VI of the Civil Rights Act of 1964, title IX of the Education Amendments of 1972, the Age Discrimination Act of 1975, or section 504 of the Rehabilitation Act of 1973, be excluded 37693 from participation in, be denied the benefits of, or be subjected to discrimination under, any health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, or under any program or activity that is administered by an executive agency or any entity established under title I of the ACA. This part applies to health programs or activities administered by recipients of Federal financial assistance from the Department, Department-administered health programs or activities, and title I entities that administer health programs or activities. (b) Effective date. The regulations in this part are effective beginning July 5, 2024, unless otherwise provided in the following schedule: TABLE 1 TO PARAGRAPH (b) Section 1557 requirement and provision § 92.7 ........................ § 92.8 ........................ § 92.9 ........................ § 92.10 ...................... § 92.11 ...................... § 92.207(b)(1) through (5). § 92.207(b)(6) ........... § 92.210(b) and (c) ... ddrumheller on DSK120RN23PROD with RULES4 § 92.2 Date by which covered entities must comply Within 120 days of July 5, 2024. Within one year of July 5, 2024. Following a covered entity’s implementation of the policies and procedures required by § 92.8, and no later than one year of July 5, 2024. Within 120 days of July 5, 2024. Within one year of July 5, 2024. For health insurance coverage or other health-related coverage that was not subject to this part as of July 5, 2024, by the first day of the first plan year (in the individual market, policy year) beginning on or after January 1, 2025. By the first day of the first plan year (in the individual market, policy year) beginning on or after January 1, 2025. Within 300 days of July 5, 2024. Application. (a) Except as otherwise provided in this part, this part shall apply to: (1) Every health program or activity, any part of which receives Federal financial assistance, directly or indirectly, from the Department; (2) Every health program or activity administered by the Department; and (3) Every health program or activity administered by a title I entity. (b) The provisions of this part shall not apply to any employer or other plan sponsor of a group health plan, including but not limited to, a board of trustees (or similar body), association or other group, with regard to its employment practices, including the provision of employee health benefits. (c) Any provision of this part held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, shall be severable from this part and shall not affect the remainder thereof or the application of the provision to other persons not VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 similarly situated or to other, dissimilar circumstances. § 92.3 Relationship to other laws. (a) Neither section 1557 nor this part shall be construed to apply a lesser standard for the protection of individuals from discrimination than the standards applied under title VI of the Civil Rights Act of 1964, title IX of the Education Amendments of 1972, section 504 of the Rehabilitation Act of 1973, the Age Discrimination Act of 1975, or the regulations issued pursuant to those laws. (b) Nothing in this part shall be construed to invalidate or limit the rights, remedies, procedures, or legal standards available under title VI of the Civil Rights Act of 1964, title VII of the Civil Rights Act of 1964, title IX of the Education Amendments of 1972, section 504 of the Rehabilitation Act of 1973, or the Age Discrimination Act of 1975. (c) Insofar as the application of any requirement under this part would violate applicable Federal protections PO 00000 Frm 00173 Fmt 4701 Sfmt 4700 for religious freedom and conscience, such application shall not be required. For example, 42 U.S.C. 18023 provides (among other things) that nothing in section 1557 shall be construed to have any effect on Federal laws regarding conscience protection; willingness or refusal to provide abortion; and discrimination on the basis of the willingness or refusal to provide, pay for, cover, or refer for abortion or to provide or participate in training to provide abortion. (d) Nothing in this part shall be construed to supersede State or local laws that provide additional protections against discrimination on any basis described in § 92.1. § 92.4 Definitions. As used in this part, the term— 1991 Standards means the 1991 ADA Standards for Accessible Design, published at appendix A to 28 CFR part 36 on July 26, 1991, and republished as appendix D to 28 CFR part 36 on September 15, 2010. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37694 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations 2010 Standards means 36 CFR part 1191, appendices B and D (2009), in conjunction with 28 CFR 35.151. ACA means the Patient Protection and Affordable Care Act (Pub. L. 111–148, 124 Stat. 119 (2010) as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111– 152, 124 Stat. 1029) (codified in scattered sections of U.S.C.)). ADA means the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.), as amended. Age means how old a person is, or the number of elapsed years from the date of a person’s birth. Age Act means the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), as amended. Applicant means a person who applies to participate in a health program or activity. Auxiliary aids and services include, for example: (1) Qualified interpreters on-site or through video remote interpreting (VRI) services, as defined in 28 CFR 35.104 and 36.104; note takers; real-time computer-aided transcription services; written materials; exchange of written notes; telephone handset amplifiers; assistive listening devices; assistive listening systems; telephones compatible with hearing aids; closed caption decoders; open and closed captioning, including real-time captioning; voice, text, and video-based telecommunications products and systems, including text telephones (TTYs), videophones, and captioned telephones, or equally effective telecommunications devices; videotext displays; accessible information and communication technology (ICT); or other effective methods of making aurally delivered information available to persons who are deaf or hard of hearing; (2) Qualified readers; taped texts; audio recordings; Braille materials and displays; screen reader software; magnification software; optical readers; secondary auditory programs (SAP); large print materials; accessible information and communication technology; or other effective methods of making visually delivered materials available to persons who are blind or have low vision; (3) Acquisition or modification of equipment and devices; and (4) Other similar services and actions. Companion means a family member, friend, or associate of an individual seeking access to a service, program, or activity of a covered entity, who along with such individual, is an appropriate person with whom a covered entity should communicate. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Covered entity means: (1) A recipient of Federal financial assistance; (2) The Department; and (3) An entity established under title I of the ACA. Department means the U.S. Department of Health and Human Services. Director means the Director of the Office for Civil Rights (OCR) of the Department, or their designee(s). Disability means, with respect to an individual, a physical or mental impairment that substantially limits one or more major life activities of such individual; a record of such an impairment; or being regarded as having such an impairment, as defined and construed in the Rehabilitation Act, 29 U.S.C. 705(9)(B), which incorporates the definition of ‘‘disability’’ in the ADA, 42 U.S.C. 12102, as amended and adopted at 28 CFR 35.108. Exchange means the same as ‘‘Exchange’’ defined in 45 CFR 155.20. Federal financial assistance, as used in this part: (1) Federal financial assistance means any grant, loan, credit, subsidy, contract (other than a procurement contract but including a contract of insurance), or any other arrangement by which the Federal Government, directly or indirectly, provides assistance or otherwise makes assistance available in the form of: (i) Funds; (ii) Services of Federal personnel; or (iii) Real or personal property or any interest in or use of such property, including: (A) Transfers or leases of such property for less than fair market value or for reduced consideration; and (B) Proceeds from a subsequent transfer or lease of such property if the Federal share of its fair market value is not returned to the Federal Government. (2) Federal financial assistance the Department provides or otherwise makes available includes Federal financial assistance that the Department plays a role in providing or administering, including advance payments of the premium tax credit and cost-sharing reduction payments under title I of the ACA, as well as payments, subsidies, or other funds extended by the Department to any entity providing health insurance coverage for payment to or on behalf of a person obtaining health insurance coverage from that entity or extended by the Department directly to such person for payment to any entity providing health insurance coverage. Federally-facilitated Exchange means the same as ‘‘Federally-facilitated Exchange’’ defined in 45 CFR 155.20. PO 00000 Frm 00174 Fmt 4701 Sfmt 4700 Health program or activity means: (1) Any project, enterprise, venture, or undertaking to: (i) Provide or administer healthrelated services, health insurance coverage, or other health-related coverage; (ii) Provide assistance to persons in obtaining health-related services, health insurance coverage, or other healthrelated coverage; (iii) Provide clinical, pharmaceutical, or medical care; (iv) Engage in health or clinical research; or (v) Provide health education for health care professionals or others. (2) All of the operations of any entity principally engaged in the provision or administration of any health projects, enterprises, ventures, or undertakings described in paragraph (1) of this definition, including, but not limited to, a State or local health agency, hospital, health clinic, health insurance issuer, physician’s practice, pharmacy, community-based health care provider, nursing facility, residential or community-based treatment facility, or other similar entity or combination thereof. A health program or activity also includes all of the operations of a State Medicaid program, Children’s Health Insurance Program, and Basic Health Program. Individual with limited English proficiency means an individual whose primary language for communication is not English and who has a limited ability to read, write, speak, or understand English. An individual with limited English proficiency may be competent in English for certain types of communication (e.g., speaking or understanding), but still be limited English proficient for other purposes (e.g., reading or writing). Information and communication technology (ICT) means information technology and other equipment, systems, technologies, or processes, for which the principal function is the creation, manipulation, storage, display, receipt, or transmission of electronic data and information, as well as any associated content. Examples of ICT include, but are not limited to: computers and peripheral equipment; information kiosks and transaction machines; telecommunications equipment; telehealth interfaces or applications; customer premises equipment; multifunction office machines; software; mobile applications; websites; videos; and electronic documents. Language assistance services may include, but are not limited to: E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations (1) Oral language assistance, including interpretation in non-English languages provided in-person or remotely by a qualified interpreter for an individual with limited English proficiency, and the use of qualified bilingual or multilingual staff to communicate directly with individuals with limited English proficiency; (2) Written translation, performed by a qualified translator, of written content in paper or electronic form into or from languages other than English; and (3) Written notice of availability of language assistance services. Machine translation means automated translation, without the assistance of or review by a qualified human translator, that is text-based and provides instant translations between various languages, sometimes with an option for audio input or output. National origin includes, but is not limited to, a person’s, or their ancestors’, place of origin (such as country or world region) or a person’s manifestation of the physical, cultural, or linguistic characteristics of a national origin group. OCR means the Office for Civil Rights of the Department. Patient care decision support tool means any automated or non-automated tool, mechanism, method, technology, or combination thereof used by a covered entity to support clinical decision-making in its health programs or activities. Qualified bilingual/multilingual staff means a member of a covered entity’s workforce who is designated by the covered entity to provide in-language oral language assistance as part of the person’s current, assigned job responsibilities and who has demonstrated to the covered entity that they are: (1) Proficient in speaking and understanding both spoken English and at least one other spoken language, including any necessary specialized vocabulary, terminology and phraseology; and (2) Able to effectively, accurately, and impartially communicate directly with individuals with limited English proficiency in their primary languages. Qualified individual with a disability means an individual with a disability who, with or without reasonable modifications to rules, policies, or practices, the removal of architectural, communication, or transportation barriers, or the provision of auxiliary aids and services, meets the essential eligibility requirements for the receipt of services or the participation in programs or activities provided by the covered entity. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 Qualified interpreter for an individual with a disability means an interpreter who, via a video remote interpreting service (VRI) or an on-site appearance: (1) Has demonstrated proficiency in communicating in, and understanding: (i) Both English and a non-English language (including American Sign Language, other sign languages); or (ii) Another communication modality (such as cued-language transliterators or oral transliteration); (2) Is able to interpret effectively, accurately, and impartially, both receptively and expressively, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original statement; and (3) Adheres to generally accepted interpreter ethics principles including client confidentiality. (4) Qualified interpreters include, for example, sign language interpreters, oral transliterators, and cued-language transliterators. Qualified interpreter for an individual with limited English proficiency means an interpreter who via a remote interpreting service or an on-site appearance: (1) Has demonstrated proficiency in speaking and understanding both spoken English and at least one other spoken language (qualified interpreters for relay interpretation must demonstrate proficiency in two nonEnglish spoken languages); (2) Is able to interpret effectively, accurately, and impartially to and from such language(s) and English (or between two non-English languages for relay interpretation), using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, sentiment, and emotional level of the original oral statement; and (3) Adheres to generally accepted interpreter ethics principles, including client confidentiality. Qualified reader means a person who is able to read effectively, accurately, and impartially using any necessary specialized vocabulary. Qualified translator means a translator who: (1) Has demonstrated proficiency in writing and understanding both written English and at least one other written non-English language; (2) Is able to translate effectively, accurately, and impartially to and from such language(s) and English, using any necessary specialized vocabulary or terms without changes, omissions, or additions and while preserving the tone, PO 00000 Frm 00175 Fmt 4701 Sfmt 4700 37695 sentiment, and emotional level of the original written statement; and (3) Adheres to generally accepted translator ethics principles, including client confidentiality. Recipient means any State or its political subdivision thereof; or any instrumentality of a State or political subdivision thereof; any public or private agency, institution, or organization; other entity; or any person, to whom Federal financial assistance is extended directly or indirectly, including any subunit, successor, assignee, or transferee of a recipient. Such term does not include any ultimate beneficiary. Relay interpretation means interpreting from one language to another through an intermediate language. This mode of interpretation is often used for monolingual speakers of languages of limited diffusion, including select indigenous languages. In relay interpreting, the first interpreter listens to the speaker and renders the message into the intermediate language. The second interpreter receives the message in the intermediate language and interprets it into a third language for the speaker who speaks neither the first nor the second language. Section 504 means section 504 of the Rehabilitation Act of 1973 (Pub. L. 93– 112; 29 U.S.C. 794), as amended. Section 1557 means section 1557 of the ACA (42 U.S.C. 18116). State includes each of the several States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands. State Exchange means an Exchange established by a State and approved by the Department pursuant to 45 CFR part 155, subpart B. Telehealth means the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional health-related education, public health, and health administration. Technologies include videoconferencing, the internet, storeand-forward imaging, streaming media, and terrestrial and wireless communications. Title I entity means any entity established under title I of the ACA, as amended, including State Exchanges and Federally-facilitated Exchanges. Title VI means title VI of the Civil Rights Act of 1964 (Pub. L. 88–352; 42 U.S.C. 2000d et seq.), as amended. Title VII means title VII of the Civil Rights Act of 1964 (Pub. L. 88–352; 42 U.S.C. 2000e et seq.), as amended. E:\FR\FM\06MYR4.SGM 06MYR4 37696 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations Title IX means title IX of the Education Amendments of 1972 (Pub. L. 92–318; 20 U.S.C. 1681 et seq.), as amended. UFAS means the Uniform Federal Accessibility Standards (Pub. L. 90–480; 42 U.S.C. 4151 et seq.), as amended. § 92.5 Assurances required. (a) Assurances. An entity applying for Federal financial assistance to which this part applies must, as a condition of any application for Federal financial assistance, submit an assurance, on a form specified by the Director, that the entity’s health programs and activities will be operated in compliance with section 1557 and this part. A health insurance issuer seeking certification to participate in an Exchange or a State seeking approval to operate a State Exchange to which section 1557 or this part applies must, as a condition of certification or approval, submit an assurance, on a form specified by the Director, that the health insurance issuer’s or State’s health program or activity will be operated in compliance with section 1557 and this part. An applicant or entity may incorporate this assurance by reference in subsequent applications to the Department for Federal financial assistance or requests for certification to participate in an Exchange or approval to operate a State Exchange. (b) Duration of obligation. The duration of the assurances required by this section is the same as the duration of the assurances required in the Department’s regulations implementing section 504, 45 CFR 84.5(b). (c) Covenants. When Federal financial assistance is provided in the form of real property or interest, the same conditions apply as those contained in the Department’s regulations implementing section 504, at 45 CFR 84.5(c), except that the nondiscrimination obligation applies to discrimination on all bases covered under section 1557 and this part. ddrumheller on DSK120RN23PROD with RULES4 § 92.6 Remedial action and voluntary action. (a) Remedial action. (1) If the Director finds that a recipient or State Exchange has discriminated against an individual on the basis of race, color, national origin, sex, age, or disability, in violation of section 1557 or this part, such recipient or State Exchange must take such remedial action as the Director may require to overcome the effects of the discrimination. (2) Where a recipient is found to have discriminated against an individual on the basis of race, color, national origin, sex, age, or disability, in violation of VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 section 1557 or this part, and where another recipient exercises control over the recipient that has discriminated, the Director, where appropriate, may require either or both entities to take remedial action. (3) The Director may, where necessary to overcome the effects of discrimination in violation of section 1557 or this part, require a recipient, in its health programs and activities, or State Exchange to take remedial action with respect to: (i) Persons who are no longer participants in the recipient’s or State Exchange’s health program or activity but who were participants in the health program or activity when such discrimination occurred; or (ii) Persons who would have been participants in the health program or activity had the discrimination not occurred. (b) Voluntary action. A covered entity may take nondiscriminatory steps, in addition to any action that is required by section 1557 or this part, to overcome the effects of conditions that result or resulted in limited participation in the covered entity’s health programs or activities by persons on the basis of race, color, national origin, sex, age, or disability. § 92.7 Designation and responsibilities of a Section 1557 Coordinator. (a) Section 1557 Coordinator and designees. A covered entity that employs fifteen or more persons must designate and authorize at least one employee, a ‘‘Section 1557 Coordinator,’’ to coordinate the covered entity’s compliance with its responsibilities under section 1557 and this part in its health programs and activities, including the investigation of any grievance communicated to it alleging noncompliance with section 1557 or this part or alleging any action that would be prohibited by section 1557 or this part. As appropriate, a covered entity may assign one or more designees to carry out some of these responsibilities, but the Section 1557 Coordinator must retain ultimate oversight for ensuring coordination with the covered entity’s compliance with this part. (b) Responsibilities of a Section 1557 Coordinator. A covered entity must ensure that, at minimum, the Section 1557 Coordinator: (1) Receives, reviews, and processes grievances, filed under the grievance procedure as set forth in § 92.8(c); (2) Coordinates the covered entity’s recordkeeping requirements as set forth in § 92.8(c); PO 00000 Frm 00176 Fmt 4701 Sfmt 4700 (3) Coordinates effective implementation of the covered entity’s language access procedures as set forth in § 92.8(d); (4) Coordinates effective implementation of the covered entity’s effective communication procedures as set forth in § 92.8(e); (5) Coordinates effective implementation of the covered entity’s reasonable modification procedures as set forth in § 92.8(f); and (6) Coordinates training of relevant employees as set forth in § 92.9, including maintaining documentation required by such section. § 92.8 Policies and procedures. (a) General requirement. A covered entity must implement written policies and procedures in its health programs and activities that are designed to comply with the requirements of this part. The policies and procedures must include an effective date and be reasonably designed, taking into account the size, complexity, and the type of health programs or activities undertaken by a covered entity, to ensure compliance with this part. (b) Nondiscrimination policy. (1) A covered entity must implement a written policy in its health programs and activities that, at minimum, states the covered entity does not discriminate on the basis of race, color, national origin (including limited English proficiency and primary language), sex (consistent with the scope of sex discrimination described at § 92.101(a)(2)), age, or disability; that the covered entity provides language assistance services and appropriate auxiliary aids and services free of charge, when necessary for compliance with section 1557 or this part; that the covered entity will provide reasonable modifications for individuals with disabilities; and that provides the current contact information for the Section 1557 Coordinator required by § 92.7 (if applicable). (2) OCR considers it a best practice toward achieving compliance for a covered entity to provide information that it has been granted a temporary exemption or granted an assurance of exemption under § 92.302(b) in the nondiscrimination policy required by paragraph (b)(1) of this section. (c) Grievance procedures. (1) A covered entity that employs fifteen or more persons must implement written grievance procedures in its health programs and activities that provide for the prompt and equitable resolution of grievances alleging any action that would be prohibited by section 1557 or this part. E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations (2) A covered entity to which this paragraph applies must retain records related to grievances filed pursuant to the covered entity’s grievance procedures required under paragraph (c)(1) of this section that allege discrimination on the basis of race, color, national origin, sex, age, or disability for no less than three (3) calendar years from the date the covered entity resolves the grievance. The records must include the grievance; the name and contact information of the complainant (if provided by complainant); the alleged discriminatory action and alleged basis (or bases) of discrimination; the date the grievance was filed; the date the grievance was resolved; grievance resolution; and any other pertinent information. (3) A covered entity to which this paragraph (c) applies must keep confidential the identity of an individual who has filed a grievance under this part except as required by law or to the extent necessary to carry out the purposes of this part, including the conduct of any investigation. (d) Language access procedures. A covered entity must implement written language access procedures in its health programs and activities describing the covered entity’s process for providing language assistance services to individuals with limited English proficiency when required under § 92.201. At a minimum, the language access procedures must include current contact information for the section 1557 Coordinator (if applicable); how an employee identifies whether an individual has limited English proficiency; how an employee obtains the services of qualified interpreters and translators the covered entity uses to communicate with an individual with limited English proficiency; the names of any qualified bilingual staff members; and a list of any electronic and written translated materials the covered entity has, the languages they are translated into, date of issuance, and how to access electronic translations. (e) Effective communication procedures. A covered entity must implement written effective communication procedures in its health programs and activities describing the covered entity’s process for ensuring effective communication for individuals with disabilities when required under § 92.202. At a minimum, a covered entity’s effective communication procedures must include current contact information for the Section 1557 Coordinator (if applicable); how an employee obtains the services of qualified interpreters the covered entity VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 uses to communicate with individuals with disabilities, including the names of any qualified interpreter staff members; and how to access appropriate auxiliary aids and services. (f) Reasonable modification procedures. A covered entity must implement written procedures in its health programs and activities describing the covered entity’s process for making reasonable modifications to its policies, practices, or procedures when necessary to avoid discrimination on the basis of disability as required under § 92.205. At a minimum, the reasonable modification procedures must include current contact information for the covered entity’s Section 1557 Coordinator (if applicable); a description of the covered entity’s process for responding to requests from individuals with disabilities for changes, exceptions, or adjustments to a rule, policy, practice, or service of the covered entity; and a process for determining whether making the modification would fundamentally alter the nature of the health program or activity, including identifying an alternative modification that does not result in a fundamental alteration to ensure the individual with a disability receives the benefits or services in question. (g) Combined policies and procedures. A covered entity may combine the content of the policies and procedures required by paragraphs (b) through (f) of this section with any policies and procedures pursuant to title VI, section 504, title IX, and the Age Act if section 1557 and the provisions in this part are clearly addressed therein. (h) Changes to policies and procedures. (1) Covered entities must review and revise the policies and procedures required by paragraphs (b) through (g) of this section, as necessary, to ensure they are current and in compliance with section 1557 and this part; and (2) A covered entity may change a policy or procedure required by paragraphs (b) through (g) of this section at any time, provided that such changes comply with section 1557 and this part. § 92.9 Training. (a) A covered entity must train relevant employees of its health programs and activities on the civil rights policies and procedures required by § 92.8, as necessary and appropriate for the employees to carry out their functions within the covered entity consistent with the requirements of this part. PO 00000 Frm 00177 Fmt 4701 Sfmt 4700 37697 (b) A covered entity must provide training that meets the requirements of paragraph (a) of this section, as follows: (1) To each relevant employee of the health program or activity as soon as possible, but no later than 30 days following a covered entity’s implementation of the policies and procedures required by § 92.8, and no later than 300 days following July 5, 2024; (2) Thereafter, to each new relevant employee of the health program or activity within a reasonable period of time after the employee joins the covered entity’s workforce; and (3) To each relevant employee of the health program or activity whose functions are affected by a material change in the policies or procedures required by § 92.8 and any other civil rights policies or procedures the covered entity has implemented within a reasonable period of time after the material change has been made. (4) For purposes of this section, ‘‘relevant employees’’ includes permanent and temporary employees whose roles and responsibilities entail interacting with patients and members of the public; making decisions that directly or indirectly affect patients’ health care, including the covered entity’s executive leadership team and legal counsel; and performing tasks and making decisions that directly or indirectly affect patients’ financial obligations, including billing and collections. (c) A covered entity must contemporaneously document its employees’ completion of the training required by paragraphs (a) and (b) of this section in written or electronic form and retain said documentation for no less than three (3) calendar years. § 92.10 Notice of nondiscrimination. (a) A covered entity must provide a notice of nondiscrimination to participants, beneficiaries, enrollees, and applicants of its health programs and activities, and members of the public. (1) The notice required under this paragraph (a) must include the following information relating to the covered entity’s health programs and activities: (i) The covered entity does not discriminate on the basis of race, color, national origin (including limited English proficiency and primary language), sex (consistent with the scope of sex discrimination described at § 92.101(a)(2)), age, or disability; (ii) The covered entity provides reasonable modifications for individuals with disabilities, and appropriate E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37698 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations auxiliary aids and services, including qualified interpreters for individuals with disabilities and information in alternate formats, such as braille or large print, free of charge and in a timely manner, when such modifications, aids, and services are necessary to ensure accessibility and an equal opportunity to participate to individuals with disabilities; (iii) The covered entity provides language assistance services, including electronic and written translated documents and oral interpretation, free of charge and in a timely manner, when such services are a reasonable step to provide meaningful access to an individual with limited English proficiency; (iv) How to obtain from the covered entity the reasonable modifications, appropriate auxiliary aids and services, and language assistance services in paragraphs (a)(1)(ii) and (iii) of this section; (v) The contact information for the covered entity’s Section 1557 Coordinator designated pursuant to § 92.7 (if applicable); (vi) The availability of the covered entity’s grievance procedure pursuant to § 92.8(c) and how to file a grievance (if applicable); (vii) Details on how to file a discrimination complaint with OCR in the Department; and (viii) How to access the covered entity’s website, if it has one, that provides the information required under this paragraph (a)(1). (2) The notice required under this paragraph (a) must be provided in a covered entity’s health program or activity, as follows: (i) On an annual basis to participants, beneficiaries, enrollees (including late and special enrollees), and applicants of its health program or activity; (ii) Upon request; (iii) At a conspicuous location on the covered entity’s health program or activity website, if it has one; and (iv) In clear and prominent physical locations, in no smaller than 20-point sans serif font, where it is reasonable to expect individuals seeking service from the health program or activity to be able to read or hear the notice. (b) A covered entity may combine the content of the notice required by paragraph (a) of this section with the notices required by 45 CFR 80.6(d), 84.8, 86.9, and 91.32 if the combined notice clearly informs individuals of their civil rights under section 1557 and this part, so long as it includes each of the elements required by paragraph (a)(1) of this section. VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 § 92.11 Notice of availability of language assistance services and auxiliary aids and services. (a) A covered entity must provide a notice of availability of language assistance services and auxiliary aids and services that, at minimum, states that the covered entity, in its health programs or activities, provides language assistance services and appropriate auxiliary aids and services free of charge, when necessary for compliance with section 1557 or this part, to participants, beneficiaries, enrollees, and applicants of its health program or activities, and members of the public. (b) The notice required under paragraph (a) of this section must be provided in English and at least the 15 languages most commonly spoken by individuals with limited English proficiency of the relevant State or States in which a covered entity operates and must be provided in alternate formats for individuals with disabilities who require auxiliary aids and services to ensure effective communication. (c) The notice required under paragraph (a) of this section must be provided in a covered entity’s health program or activity, as follows: (1) On an annual basis to participants, beneficiaries, enrollees (including late and special enrollees), and applicants of its health program or activity; (2) Upon request; (3) At a conspicuous location on the covered entity’s health program or activity website, if it has one; (4) In clear and prominent physical locations, in no smaller than 20-point sans serif font, where it is reasonable to expect individuals seeking service from the health program or activity to be able to read or hear the notice; and (5) In the following electronic and written communications when these forms are provided by a covered entity: (i) Notice of nondiscrimination required by § 92.10; (ii) Notice of privacy practices required by 45 CFR 164.520; (iii) Application and intake forms; (iv) Notices of denial or termination of eligibility, benefits or services, including Explanations of Benefits, and notices of appeal and grievance rights; (v) Communications related to an individual’s rights, eligibility, benefits, or services that require or request a response from a participant, beneficiary, enrollee, or applicant; (vi) Communications related to a public health emergency; (vii) Consent forms and instructions related to medical procedures or operations, medical power of attorney, PO 00000 Frm 00178 Fmt 4701 Sfmt 4700 or living will (with an option of providing only one notice for all documents bundled together); (viii) Discharge papers; (ix) Communications related to the cost and payment of care with respect to an individual, including medical billing and collections materials, and good faith estimates required by section 2799B–6 of the Public Health Service Act; (x) Complaint forms; and (xi) Patient and member handbooks. (d) A covered entity shall be deemed in compliance with this section with respect to an individual if it exercises the option to: (1) On an annual basis, provide the individual with the option to opt out of receipt of the notice required by this section in their primary language and through any appropriate auxiliary aids and services, and: (i) Does not condition the receipt of any aid or benefit on the individual’s decision to opt out; (ii) Informs the individual that they have a right to receive the notice upon request in their primary language and through the appropriate auxiliary aids and services; (iii) Informs the individual that opting out of receiving the notice is not a waiver of their right to receive language assistance services and any appropriate auxiliary aids and services as required by this part; (iv) Documents, on an annual basis, that the individual has opted out of receiving the notice required by this section for that year; and (v) Does not treat a non-response from an individual as a decision to opt out; or (2) Document the individual’s primary language and any appropriate auxiliary aids and services and: (i) Provides all materials and communications in that individual’s primary language and through any appropriate auxiliary aids and services; or (ii) Provides the notice required by paragraph (a) of this section in that individual’s primary language and through any appropriate auxiliary aids and services in all communications that are identified in paragraph (c)(5) of this section. Subpart B—Nondiscrimination Provisions § 92.101 Discrimination prohibited. (a) General. (1) Except as provided in title I of the ACA, an individual must not, on the basis of race, color, national origin, sex, age, disability, or any combination thereof, be excluded from E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations ddrumheller on DSK120RN23PROD with RULES4 participation in, be denied the benefits of, or otherwise be subjected to discrimination under any health program or activity operated by a covered entity. (2) Discrimination on the basis of sex includes, but is not limited to, discrimination on the basis of: (i) Sex characteristics, including intersex traits; (ii) Pregnancy or related conditions; (iii) Sexual orientation; (iv) Gender identity; and (v) Sex stereotypes. (b) Specific prohibitions on discrimination. (1) In any health program or activity to which this part applies: (i) A recipient and State Exchange must comply with the specific prohibitions on discrimination in the Department’s implementing regulations for title VI, section 504, title IX, and the Age Act, found at 45 CFR parts 80, 84, 86 (subparts C and D), and 91 (subpart B), respectively. Where this paragraph (b) cross-references regulatory provisions that use the term ‘‘recipient,’’ the term ‘‘recipient or State Exchange’’ shall apply in its place. Where this paragraph (b) cross-references regulatory provisions that use the term ‘‘student,’’ ‘‘employee,’’ or ‘‘applicant,’’ these terms shall be replaced with ‘‘individual.’’ (ii) The Department, including Federally-facilitated Exchanges, must comply with specific prohibitions on discrimination in the Department’s implementing regulations for title VI, section 504, title IX, and the Age Act, found at 45 CFR parts 80, 85, 86 (subparts C and D), and 91 (subpart B), respectively. Where this paragraph (b) cross-references regulatory provisions that use the term ‘‘a recipient,’’ the term ‘‘the Department or a Federallyfacilitated Exchange’’ shall apply in its place. Where this paragraph (b) crossreferences regulatory provisions that use the term ‘‘student,’’ ‘‘employee,’’ or ‘‘applicant,’’ these terms shall be replaced with ‘‘individual.’’ (2) The enumeration of specific prohibitions on discrimination in paragraph (b)(1) of this section does not limit the general applicability of the prohibition in paragraph (a) of this section. Subpart C—Specific Applications to Health Programs and Activities § 92.201 Meaningful access for individuals with limited English proficiency. (a) General requirement. A covered entity must take reasonable steps to provide meaningful access to each individual with limited English proficiency (including companions with VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 limited English proficiency) eligible to be served or likely to be directly affected by its health programs and activities. (b) Language assistance services requirements. Language assistance services required under paragraph (a) of this section must be provided free of charge, be accurate and timely, and protect the privacy and the independent decision-making ability of the individual with limited English proficiency. (c) Specific requirements for interpreter and translation services. (1) When interpretation services are required under this part, a covered entity must offer a qualified interpreter in its health programs and activities. (2) When translation services are required under this part, a covered entity must utilize the services of a qualified translator in its health programs and activities. (3) If a covered entity uses machine translation when the underlying text is critical to the rights, benefits, or meaningful access of an individual with limited English proficiency, when accuracy is essential, or when the source documents or materials contain complex, non-literal or technical language, the translation must be reviewed by a qualified human translator. (d) Evaluation of compliance. In evaluating whether a covered entity has met its obligation under paragraph (a) of this section, the Director shall: (1) Evaluate, and give substantial weight to, the nature and importance of the health program or activity and the particular communication at issue, to the individual with limited English proficiency; and (2) Take into account other relevant factors, including the effectiveness of the covered entity’s written language access procedures for its health programs and activities, that the covered entity has implemented pursuant to § 92.8(d). (e) Restricted use of certain persons to interpret or facilitate communication. A covered entity must not, in its health programs and activities: (1) Require an individual with limited English proficiency to provide their own interpreter, or to pay the cost of their own interpreter; (2) Rely on an adult, not qualified as an interpreter, to interpret or facilitate communication, except: (i) As a temporary measure, while finding a qualified interpreter in an emergency involving an imminent threat to the safety or welfare of an individual or the public where there is no qualified interpreter for the individual with limited English PO 00000 Frm 00179 Fmt 4701 Sfmt 4700 37699 proficiency immediately available and the qualified interpreter that arrives confirms or supplements the initial communications with an initial adult interpreter; or (ii) Where the individual with limited English proficiency specifically requests, in private with a qualified interpreter present and without an accompanying adult present, that the accompanying adult interpret or facilitate communication, the accompanying adult agrees to provide such assistance, the request and agreement by the accompanying adult is documented, and reliance on that adult for such assistance is appropriate under the circumstances; (3) Rely on a minor child to interpret or facilitate communication, except as a temporary measure while finding a qualified interpreter in an emergency involving an imminent threat to the safety or welfare of an individual or the public where there is no qualified interpreter for the individual with limited English proficiency immediately available and the qualified interpreter that arrives confirms or supplements the initial communications with the minor child; or (4) Rely on staff other than qualified interpreters, qualified translators, or qualified bilingual/multilingual staff to communicate with individuals with limited English proficiency. (f) Video remote interpreting services. A covered entity that provides a qualified interpreter for an individual with limited English proficiency through video remote interpreting services in the covered entity’s health programs and activities must ensure the modality allows for meaningful access and must provide: (1) Real-time, full-motion video and audio over a dedicated high-speed, wide-bandwidth video connection or wireless connection that delivers high quality video images that do not produce lags, choppy, blurry, or grainy images, or irregular pauses in communication; (2) A sharply delineated image that is large enough to display the interpreter’s face and the participating person’s face regardless of the person’s body position; (3) A clear, audible transmission of voices; and (4) Adequate training to users of the technology and other involved persons so that they may quickly and efficiently set up and operate the video remote interpreting. (g) Audio remote interpreting services. A covered entity that provides a qualified interpreter for an individual with limited English proficiency through audio remote interpreting E:\FR\FM\06MYR4.SGM 06MYR4 37700 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations services in the covered entity’s health programs and activities must ensure the modality allows for meaningful access and must provide: (1) Real-time audio over a dedicated high-speed, wide-bandwidth connection or wireless connection that delivers high-quality audio without lags or irregular pauses in communication; (2) A clear, audible transmission of voices; and (3) Adequate training to users of the technology and other involved persons so that they may quickly and efficiently set up and operate the remote interpreting services. (h) Acceptance of language assistance services is not required. Nothing in this section shall be construed to require an individual with limited English proficiency to accept language assistance services. § 92.202 Effective communication for individuals with disabilities. (a) A covered entity must take appropriate steps to ensure that communications with individuals with disabilities (including companions with disabilities), are as effective as communications with non-disabled individuals in its health programs and activities, in accordance with the standards found at 28 CFR 35.130 and 35.160 through 35.164. Where the regulatory provisions referenced in this section use the term ‘‘public entity,’’ the term ‘‘covered entity’’ shall apply in its place. (b) A covered entity must provide appropriate auxiliary aids and services where necessary to afford individuals with disabilities an equal opportunity to participate in, and enjoy the benefits of, the health program or activity in question. Such auxiliary aids and services must be provided free of charge, in accessible formats, in a timely manner, and in such a way to protect the privacy and the independence of the individual with a disability. ddrumheller on DSK120RN23PROD with RULES4 § 92.203 Accessibility for buildings and facilities. (a) No qualified individual with a disability shall, because a covered entity’s facilities are inaccessible to or unusable by individuals with disabilities, be denied the benefits of, be excluded from participation in, or otherwise be subjected to discrimination under any health program or activity to which this part applies. (b) Each facility or part of a facility in which health programs or activities are conducted that is constructed or altered by or on behalf of, or for the use of, a recipient or State Exchange must comply with the 2010 Standards if the VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 construction or alteration was commenced on or after July 18, 2016, except that if a facility or part of a facility in which health programs or activities are conducted that is constructed or altered by or on behalf of, or for the use of, a recipient or State Exchange, was not covered by the 2010 Standards prior to July 18, 2016, such facility or part of a facility must comply with the 2010 Standards if the construction or alteration was commenced after January 18, 2018. If construction or alteration was begun on or after July 18, 2016, and on or before January 18, 2018, in conformance with UFAS, and the facility or part of the facility was not covered by the 2010 Standards prior to July 18, 2016, then it shall be deemed to comply with the requirements of this section and with 45 CFR 84.23(a) and (b). Departures from particular technical and scoping requirements by the use of other methods are permitted where substantially equivalent or greater access to and usability of the facility is provided. All newly constructed or altered buildings or facilities subject to this section must comply with the requirements for a ‘‘public building or facility’’ as defined in section 106.5 of the 2010 Standards. (c) Each facility or part of a facility in which health programs or activities under this part are conducted that is constructed or altered by or on behalf of, or for the use of, a recipient or State Exchange in conformance with the 1991 Standards at appendix D to 28 CFR part 36 or the 2010 Standards shall be deemed to comply with the requirements of this section and with 45 CFR 84.23(a) and (b) with respect to those facilities, if the construction or alteration was commenced before July 18, 2016. Each facility or part of a facility in which health programs or activities are conducted that is constructed or altered by or on behalf of, or for the use of, a recipient or State Exchange in conformance with UFAS shall be deemed to comply with the requirements of this section and with 45 CFR 84.23(a) and (b), if the construction or alteration was commenced before July 18, 2016, and such facility would not have been required to conform with a different accessibility standard under 28 CFR 35.151. § 92.204 Accessibility of information and communication technology for individuals with disabilities. (a) A covered entity must ensure that its health programs and activities provided through information and communication technology are accessible to individuals with PO 00000 Frm 00180 Fmt 4701 Sfmt 4700 disabilities, unless doing so would result in undue financial and administrative burdens or a fundamental alteration in the nature of the health programs or activities. If an action required to comply with this section would result in such an alteration or such burdens, a covered entity shall take any other action that would not result in such an alteration or such burdens but would nevertheless ensure that, to the maximum extent possible, individuals with disabilities receive the benefits or services of the health program or activity provided by the covered entity. (b) A recipient or State Exchange shall ensure that its health programs and activities provided through websites and mobile applications comply with the requirements of section 504 of the Rehabilitation Act, as interpreted consistent with title II of the ADA (42 U.S.C. 12131 through 12165). § 92.205 Requirement to make reasonable modifications. A covered entity must make reasonable modifications to policies, practices, or procedures in its health programs and activities when such modifications are necessary to avoid discrimination on the basis of disability, unless the covered entity can demonstrate that making the modifications would fundamentally alter the nature of the health program or activity. For the purposes of this section, the term ‘‘reasonable modifications’’ shall be interpreted in a manner consistent with the term as set forth in the ADA title II regulation at 28 CFR 35.130(b)(7). § 92.206 Equal program access on the basis of sex. (a) A covered entity must provide individuals equal access to its health programs and activities without discriminating on the basis of sex. (b) In providing access to health programs and activities, a covered entity must not: (1) Deny or limit health services, including those that have been typically or exclusively provided to, or associated with, individuals of one sex, to an individual based upon the individual’s sex assigned at birth, gender identity, or gender otherwise recorded; (2) Deny or limit, on the basis of an individual’s sex assigned at birth, gender identity, or gender otherwise recorded, a health care professional’s ability to provide health services if such denial or limitation has the effect of excluding individuals from participation in, denying them the benefits of, or otherwise subjecting them E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations to discrimination on the basis of sex under a covered health program or activity; (3) Adopt or apply any policy or practice of treating individuals differently or separating them on the basis of sex in a manner that subjects any individual to more than de minimis harm, including by adopting a policy or engaging in a practice that prevents an individual from participating in a health program or activity consistent with the individual’s gender identity; or (4) Deny or limit health services sought for purpose of gender transition or other gender-affirming care that the covered entity would provide to an individual for other purposes if the denial or limitation is based on an individual’s sex assigned at birth, gender identity, or gender otherwise recorded. (c) Nothing in this section requires the provision of any health service where the covered entity has a legitimate, nondiscriminatory reason for denying or limiting that service, including where the covered entity typically declines to provide the health service to any individual or where the covered entity reasonably determines that such health service is not clinically appropriate for a particular individual. A covered entity’s determination must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302. (d) The enumeration of specific forms of discrimination in paragraph (b) of this section does not limit the general applicability of the prohibition in paragraph (a) of this section. ddrumheller on DSK120RN23PROD with RULES4 § 92.207 Nondiscrimination in health insurance coverage and other healthrelated coverage. (a) A covered entity must not, in providing or administering health insurance coverage or other healthrelated coverage, discriminate on the basis of race, color, national origin, sex, age, disability, or any combination thereof. (b) A covered entity must not, in providing or administering health insurance coverage or other healthrelated coverage: (1) Deny, cancel, limit, or refuse to issue or renew health insurance coverage or other health-related coverage, or deny or limit coverage of a claim, or impose additional cost sharing or other limitations or restrictions on coverage, on the basis of race, color, national origin, sex, age, disability, or any combination thereof; VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 (2) Have or implement marketing practices or benefit designs that discriminate on the basis of race, color, national origin, sex, age, disability, or any combination thereof, in health insurance coverage or other healthrelated coverage; (3) Deny or limit coverage, deny or limit coverage of a claim, or impose additional cost sharing or other limitations or restrictions on coverage, to an individual based upon the individual’s sex assigned at birth, gender identity, or gender otherwise recorded; (4) Have or implement a categorical coverage exclusion or limitation for all health services related to gender transition or other gender-affirming care; (5) Otherwise deny or limit coverage, deny or limit coverage of a claim, or impose additional cost sharing or other limitations or restrictions on coverage, for specific health services related to gender transition or other genderaffirming care if such denial, limitation, or restriction results in discrimination on the basis of sex; or (6) Have or implement benefit designs that do not provide or administer health insurance coverage or other healthrelated coverage in the most integrated setting appropriate to the needs of qualified individuals with disabilities, including practices that result in the serious risk of institutionalization or segregation. (c) Nothing in this section requires coverage of any health service where the covered entity has a legitimate, nondiscriminatory reason for denying or limiting coverage of the health service or determining that such health service fails to meet applicable coverage requirements, including reasonable medical management techniques such as medical necessity requirements. Such coverage denial or limitation must not be based on unlawful animus or bias, or constitute a pretext for discrimination. Nothing in this section is intended to preclude a covered entity from availing itself of protections described in §§ 92.3 and 92.302. (d) The enumeration of specific forms of discrimination in paragraph (b) of this section does not limit the general applicability of the prohibition in paragraph (a) of this section. § 92.208 Prohibition on sex discrimination related to marital, parental, or family status. In determining whether an individual satisfies any policy or criterion regarding access to its health programs or activities, a covered entity must not take an individual’s sex, as defined in § 92.101(a)(2), into account in applying PO 00000 Frm 00181 Fmt 4701 Sfmt 4700 37701 any rule concerning an individual’s current, perceived, potential, or past marital, parental, or family status. § 92.209 Nondiscrimination on the basis of association. A covered entity must not exclude from participation in, deny the benefits of, or otherwise discriminate against an individual or entity in its health programs and activities on the basis of the respective race, color, national origin, sex, age, or disability of the individual and another person with whom the individual or entity has a relationship or association. § 92.210 Nondiscrimination in the use of patient care decision support tools. (a) General prohibition. A covered entity must not discriminate on the basis of race, color, national origin, sex, age, or disability in its health programs or activities through the use of patient care decision support tools. (b) Identification of risk. A covered entity has an ongoing duty to make reasonable efforts to identify uses of patient care decision support tools in its health programs or activities that employ input variables or factors that measure race, color, national origin, sex, age, or disability. (c) Mitigation of risk. For each patient care decision support tool identified in paragraph (b) of this section, a covered entity must make reasonable efforts to mitigate the risk of discrimination resulting from the tool’s use in its health programs or activities. § 92.211 Nondiscrimination in the delivery of health programs and activities through telehealth services. A covered entity must not, in delivery of its health programs and activities through telehealth services, discriminate on the basis of race, color, national origin, sex, age, or disability. Subpart D—Procedures § 92.301 Enforcement mechanisms. The enforcement mechanisms available for and provided under title VI of the Civil Rights Act of 1964, title IX of the Education Amendments of 1972, section 504 of the Rehabilitation Act of 1973, and the Age Discrimination Act of 1975 shall apply for purposes of section 1557 as implemented by this part. § 92.302 Notification of views regarding application of Federal religious freedom and conscience laws. (a) General application. A recipient may rely on applicable Federal protections for religious freedom and conscience, and consistent with § 92.3(c), application of a particular E:\FR\FM\06MYR4.SGM 06MYR4 ddrumheller on DSK120RN23PROD with RULES4 37702 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations provision(s) of this part to specific contexts, procedures, or health care services shall not be required where such protections apply. (b) Assurance of religious freedom and conscience exemption. A recipient that seeks assurance consistent with paragraph (a) of this section regarding the application of particular provision(s) of this part to specific contexts, procedures, or health care services may do so by submitting a notification in writing to the Director of OCR. Notification may be provided by the recipient at any time, including before an investigation is initiated or during the pendency of an investigation. The notification must include: (1) The particular provision(s) of this part from which the recipient asserts they are exempt under Federal religious freedom or conscience protections; (2) The legal basis supporting the recipient’s exemption should include the standards governing the applicable Federal religious freedom and conscience protections, such as the provisions in the ACA itself; the Church, Coats-Snowe, and Weldon Amendments; the generally applicable requirements of the Religious Freedom Restoration Act (RFRA); or any other applicable Federal laws; and (3) The factual basis supporting the recipient’s exemption, including identification of the conflict between the recipient’s religious or conscience beliefs and the requirements of this part, which may include the specific contexts, procedures, or health care services that the recipient asserts will violate their religious or conscience beliefs overall or based on an individual patient matter. (c) Temporary exemption. A temporary exemption from administrative investigation and enforcement will take effect upon the recipient’s submission of the notification—regardless of whether the assurance is sought before or during an investigation. The temporary exemption is limited to the application of the particular provision(s) in this part as applied to the specific contexts, procedures, or health care services identified in the notification to OCR. (1) If the notification is received before an investigation is initiated, within 30 days of receiving the notification, OCR must provide the recipient with email confirmation acknowledging receipt of the notification. OCR will then work expeditiously to reach a determination of recipient’s notification request. (2) If the notification is received during the pendency of an investigation, the temporary exemption will exempt VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 conduct as applied to the specific contexts, procedures, or health care services identified in the notification during the pendency of OCR’s review and determination regarding the notification request. The notification shall further serve as a defense to the relevant investigation or enforcement activity regarding the recipient until the final determination of recipient’s exemption assurance request or the conclusion of the investigation. (d) Effect of determination. If OCR makes a determination to provide assurance of the recipient’s exemption from the application of certain provision(s) of this part or that modified application of certain provision(s) is required, OCR will provide the recipient its determination in writing, and if granted, the recipient will be considered exempt from OCR’s administrative investigation and enforcement with regard to the application of that provision(s) as applied to the specific contexts, procedures, or health care services provided. The determination does not otherwise limit the application of any other provision of this part to the recipient or to other contexts, procedures, or health care services. (e) Appeal. A recipient subject to an adverse determination of its request for an exemption assurance may appeal OCR’s determination under the administrative procedures set forth at 45 CFR part 81. The temporary exemption provided for in paragraph (c) of this section will expire upon a final decision under 45 CFR part 81. (f) Final agency action. A determination under this section is not final for purposes of judicial review until after a final decision under 45 CFR part 81. § 92.303 Procedures for health programs and activities conducted by recipients and State Exchanges. (a) The procedural provisions applicable to title VI apply with respect to administrative enforcement actions against health programs and activities of recipients and State Exchanges concerning discrimination on the basis of race, color, national origin, sex, age, disability, or any combination thereof, under section 1557 or this part. These procedures are found at 45 CFR 80.6 through 80.11 and 45 CFR part 81. (b) If OCR receives a complaint over which it does not have jurisdiction, it shall promptly notify the complainant and shall make reasonable efforts to refer the complaint to the appropriate Federal Government entity. (c) When a recipient or State Exchange fails to provide OCR with requested information in a timely, PO 00000 Frm 00182 Fmt 4701 Sfmt 4700 complete, and accurate manner, OCR may, after attempting to reach voluntary resolution, find noncompliance with section 1557 or this part and initiate appropriate enforcement procedures, found at 45 CFR 80.8, including beginning the process for fund suspension or termination and taking other action authorized by law. § 92.304 Procedures for health programs and activities administered by the Department. (a) The procedural provisions applicable to section 504 shall apply with respect to administrative enforcement actions against the Department, including Federallyfacilitated Exchanges, concerning discrimination on the basis of race, color, national origin, sex, age, disability, or any combination thereof, under section 1557 or this part. These procedures are found at 45 CFR 85.61 and 85.62. Where this section crossreferences regulatory provisions that use the term ‘‘handicap,’’ the term ‘‘race, color, national origin, sex, age, or disability, or any combination thereof,’’ shall apply in its place. (b) The Department must permit access by OCR to its books, records, accounts, other sources of information, and facilities as may be pertinent to ascertain compliance with section 1557 or this part. Where any information required of the Department is in the exclusive possession of any other agency, institution or person, and the other agency, institution or person fails or refuses to furnish this information, the Department shall so certify and shall set forth what efforts it has made to obtain the information. Asserted considerations of privacy or confidentiality may not operate to bar OCR from evaluating or seeking to enforce compliance with section 1557 or this part. Information of a confidential nature obtained in connection with compliance evaluation or enforcement shall not be disclosed except where necessary under the law. (c) The Department must not intimidate, threaten, coerce, retaliate, or otherwise discriminate against any individual or entity for the purpose of interfering with any right or privilege secured by section 1557 or this part, or because such individual or entity has made a complaint, testified, assisted, or participated in any manner in an investigation, proceeding or hearing under section 1557 or this part. The identity of complainants must be kept confidential by OCR in accordance with applicable Federal law. E:\FR\FM\06MYR4.SGM 06MYR4 Federal Register / Vol. 89, No. 88 / Monday, May 6, 2024 / Rules and Regulations § 155.120 Non-interference with Federal law and non-discrimination standards. PART 147—HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND INDIVIDUAL HEALTH INSURANCE MARKETS * 16. The authority citation for part 147 continues to read as follows: ■ Authority: 42 U.S.C. 300gg through 300gg– 63, 300gg–91, 300gg–92, and 300gg–111 through 300gg–139, as amended, and section 3203, Pub. L. 116–136, 134 Stat. 281. 17. Amend § 147.104 by revising paragraph (e) to read as follows: ■ § 147.104 Guaranteed availability of coverage. * * * * * (e) Marketing. A health insurance issuer and its officials, employees, agents and representatives must comply with any applicable State laws and regulations regarding marketing by health insurance issuers and cannot employ marketing practices or benefit designs that will have the effect of discouraging the enrollment of individuals with significant health needs in health insurance coverage or discriminate based on an individual’s race, color, national origin, present or predicted disability, age, sex (which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes), expected length of life, degree of medical dependency, quality of life, or other health conditions. * * * * * PART 155—EXCHANGE ESTABLISHMENT STANDARDS AND OTHER RELATED STANDARDS UNDER THE AFFORDABLE CARE ACT 18. The authority citation for part 155 continues to read as follows: ■ Authority: 42 U.S.C. 18021–18024, 18031– 18033, 18041–18042, 18051, 18054, 18071, and 18081–18083. 19. Amend § 155.120 by revising paragraph (c)(1)(ii) to read as follows: ddrumheller on DSK120RN23PROD with RULES4 ■ VerDate Sep<11>2014 21:44 May 03, 2024 Jkt 262001 * * * * (c) * * * (1) * * * (ii) Not discriminate based on race, color, national origin, disability, age, or sex (which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes). * * * * * ■ 20. Amend § 155.220 by revising paragraph (j)(2)(i) to read as follows: § 155.220 Ability of States to permit agents and brokers and web-brokers to assist qualified individuals, qualified employers, or qualified employees enrolling in QHPs. * * * * * (j) * * * (2) * * * (i) Provide consumers with correct information, without omission of material fact, regarding the Federallyfacilitated Exchanges, QHPs offered through the Federally-facilitated Exchanges, and insurance affordability programs, and refrain from marketing or conduct that is misleading (including by having a direct enrollment website that HHS determines could mislead a consumer into believing they are visiting HealthCare.gov), coercive, or discriminates based on race, color, national origin, disability, age, or sex (which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes); * * * * * PART 156—HEALTH INSURANCE ISSUER STANDARDS UNDER THE AFFORDABLE CARE ACT, INCLUDING STANDARDS RELATED TO EXCHANGES 21. The authority citation for part 156 continues to read as follows: ■ PO 00000 Frm 00183 Fmt 4701 Sfmt 9990 37703 Authority: 42 U.S.C. 18021–18024, 18031– 18032, 18041–18042, 18044, 18054, 18061, 18063, 18071, 18082, and 26 U.S.C. 36B. 22. Amend § 156.200 by revising paragraph (e) to read as follows: ■ § 156.200 QHP issuer participation standards. * * * * * (e) Non-discrimination. A QHP issuer must not, with respect to its QHP, discriminate on the basis of race, color, national origin, disability, age, or sex (which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes). * * * * * 23. Amend § 156.1230 by revising paragraph (b)(2) to read as follows: ■ § 156.1230 Direct enrollment with the QHP issuer in a manner considered to be through the Exchange. * * * * * (b) * * * (2) The QHP issuer must provide consumers with correct information, without omission of material fact, regarding the Federally-facilitated Exchanges, QHPs offered through the Federally-facilitated Exchanges, and insurance affordability programs, and refrain from marketing or conduct that is misleading (including by having a direct enrollment website that HHS determines could mislead a consumer into believing they are visiting HealthCare.gov), coercive, or discriminates based on race, color, national origin, disability, age, or sex (which includes discrimination on the basis of sex characteristics, including intersex traits; pregnancy or related conditions; sexual orientation; gender identity; and sex stereotypes). [FR Doc. 2024–08711 Filed 4–26–24; 4:15 pm] BILLING CODE 4153–01–P E:\FR\FM\06MYR4.SGM 06MYR4

Agencies

[Federal Register Volume 89, Number 88 (Monday, May 6, 2024)]
[Rules and Regulations]
[Pages 37522-37703]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08711]



[[Page 37521]]

Vol. 89

Monday,

No. 88

May 6, 2024

Part IV





Department of Health and Human Services





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Centers for Medicare & Medicaid Services





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42 CFR Parts 438, 440, 457, et al.

45 CFR Parts 80, 84, 92, et al.





Nondiscrimination in Health Programs and Activities; Final Rule

Federal Register / Vol. 89 , No. 88 / Monday, May 6, 2024 / Rules and 
Regulations

[[Page 37522]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 438, 440, 457, and 460

Office of the Secretary

45 CFR Parts 80, 84, 92, 147, 155, and 156

RIN 0945-AA17


Nondiscrimination in Health Programs and Activities

AGENCY: Office for Civil Rights, Office of the Secretary, Department of 
Health and Human Services; Centers for Medicare & Medicaid Services, 
Department of Health and Human Services.

ACTION: Final rule and interpretation.

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SUMMARY: The Department of Health and Human Services (HHS or the 
Department) is issuing this final rule regarding section 1557 of the 
Affordable Care Act (ACA) (section 1557). Section 1557 prohibits 
discrimination on the basis of race, color, national origin, sex, age, 
or disability in certain health programs and activities. Section 
1557(c) of the ACA authorizes the Secretary of the Department to 
promulgate regulations to implement the nondiscrimination requirements 
of section 1557. The Department is also revising its interpretation 
regarding whether Medicare Part B constitutes Federal financial 
assistance for purposes of civil rights enforcement. Additionally, the 
Department is revising provisions prohibiting discrimination on the 
basis of sex in regulations issued by the Centers for Medicare & 
Medicaid Services (CMS) governing Medicaid and the Children's Health 
Insurance Program (CHIP); Programs of All-Inclusive Care for the 
Elderly (PACE); health insurance issuers and their officials, 
employees, agents, and representatives; States and the Exchanges 
carrying out Exchange requirements; agents, brokers, or web-brokers 
that assist with or facilitate enrollment of qualified individuals, 
qualified employers, or qualified employees; issuers providing 
essential health benefits (EHB); and qualified health plan issuers.

DATES: Effective date: July 5, 2024.
    Applicability dates: Unless otherwise specified, the provisions of 
this final rule apply on or after July 5, 2024. See the SUPPLEMENTARY 
INFORMATION section for additional information.

FOR FURTHER INFORMATION CONTACT: 

Office for Civil Rights

    Daniel Shieh, Associate Deputy Director, HHS Office for Civil 
Rights (202) 240-3110 or (800) 537-7697 (TDD), or via email at 
[email protected], for matters related to section 1557.

Centers for Medicare & Medicaid Services

    John Giles, (410) 786-5545, for matters related to Medicaid.
    Meg Barry, 410-786-1536, for matters related to CHIP.
    Timothy Roe, (410) 786-2006 for matters related to Programs of All-
Inclusive Care for the Elderly.
    Becca Bucchieri, (301) 492-4341 or Leigha Basini, (301) 492-4380, 
for matters related to 45 CFR 155.120, 155.220, 156.125, 156.200, and 
156.1230.
    Lisa Cuozzo, (410) 786-1746, for matters related to 45 CFR 147.104.
    Hannah Katch, (202) 578-9581, for general questions related to CMS 
amendments.
    Assistance to Individuals With Disabilities in Reviewing the 
Rulemaking Record: Upon request, the Department will provide an 
accommodation or appropriate auxiliary aid or service to an individual 
with a disability who needs assistance to review the comments or other 
documents in the public rulemaking record for the final rule. To 
schedule an appointment for this type of accommodation or auxiliary 
aid, please call (202) 240-3110 or (800) 537-7697 (TDD) for assistance 
or email [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background
    A. Regulatory History
    B. Overview of the Final Rule
II. Provisions of the Proposed Rule and Analysis and Responses to 
Public Comments
    Subpart A--General Provisions
    Purpose and Effective Date (Sec.  92.1)
    Application (Sec.  92.2)
    Treatment of the Title IX Religious Exception
    Relationship to Other Laws (Sec.  92.3)
    Definitions (Sec.  92.4)
    Assurances Required (Sec.  92.5)
    Remedial Action and Voluntary Action (Sec.  92.6)
    Designation and Responsibilities of a Section 1557 Coordinator 
(Sec.  92.7)
    Policies and Procedures (Sec.  92.8)
    Training (Sec.  92.9)
    Notice of Nondiscrimination (Sec.  92.10)
    Notice of Availability of Language Assistance Services and 
Auxiliary Aids and Services (Sec.  92.11)
    Data Collection
    Subpart B--Nondiscrimination Provisions
    Discrimination Prohibited (Sec.  92.101)
    Subpart C--Specific Applications to Health Programs and 
Activities
    Meaningful Access for Individuals With Limited English 
Proficiency (Sec.  92.201)
    Effective Communication for Individuals With Disabilities (Sec.  
92.202)
    Accessibility for Buildings and Facilities (Sec.  92.203)
    Accessibility of Information and Communication Technology for 
Individuals With Disabilities (Sec.  92.204)
    Requirement To Make Reasonable Modifications (Sec.  92.205)
    Equal Program Access on the Basis of Sex (Sec.  92.206)
    Nondiscrimination in Health Insurance Coverage and Other Health-
Related Coverage (Sec.  92.207)
    Prohibition on Sex Discrimination Related to Marital, Parental, 
or Family Status (Sec.  92.208)
    Nondiscrimination on the Basis of Association (Sec.  92.209)
    Nondiscrimination in the Use of Patient Care Decision Support 
Tools (Sec.  92.210)
    Nondiscrimination in the Delivery of Health Programs and 
Activities Through Telehealth Services (Sec.  92.211)
    Subpart D--Procedures
    Enforcement Mechanisms (Sec.  92.301)
    Notification of Views Regarding Application of Federal Religious 
Freedom and Conscience Laws (Sec.  92.302)
    Procedures for Health Programs and Activities Conducted by 
Recipients and State Exchanges (Sec.  92.303)
    Procedures for Health Programs and Activities Administered by 
the Department (Sec.  92.304)
III. Change in Interpretation--Medicare Part B Funding Meets the 
Definition of Federal Financial Assistance; Responses to Public 
Comment
IV. CMS Amendments
    A. Medicaid and Children's Health Insurance Program (CHIP)
    B. Programs of All-Inclusive Care for the Elderly (PACE)
    C. Insurance Exchanges and Group and Individual Health Insurance 
Markets
    1. Comments and Responses to 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b)
    2. Health Insurance Exchanges
    a. Non-Interference With Federal Law and Nondiscrimination 
Standards (45 CFR 155.120)
    b. Federally-Facilitated Exchange Standards of Conduct (45 CFR 
155.220)
    c. Essential Health Benefits Package: Prohibition on 
Discrimination (45 CFR 156.125)
    d. QHP Issuer Participation Standards (45 CFR 156.200)
    e. Direct Enrollment With the QHP Issuer in a Manner Considered 
To Be Through the Exchange (45 CFR 156.1230)
    3. Prohibition of Discrimination--Group and Individual Health 
Insurance Markets Guaranteed Availability of Coverage (45 CFR 
147.104)
V. Executive Order 12866 and Related Executive Orders on Regulatory 
Review
    A. Regulatory Impact Analysis
    a. Baseline Conditions
    b. Costs of the Final Rule

[[Page 37523]]

    c. Total Quantified Costs
    3. Discussion of Benefits
    4. Analysis of Regulatory Alternatives to the Final Rule
    B. Regulatory Flexibility Act--Final Small Entity Analysis
    1. Entities That Will Be Affected
    a. Physicians
    b. Pharmacies
    c. Health Insurance Issuers
    d. Local Government Entities
    2. Whether the Rule Will Have a Significant Economic Impact on 
Covered Small Entities
    C. Executive Order 12250 on Leadership and Coordination of 
Nondiscrimination Laws
    D. Paperwork Reduction Act
    1. ICRs Regarding Assurances (Sec.  92.5)
    2. ICRs Regarding Section 1557 Coordinator (Sec.  92.7) and 
Training (Sec.  92.9)
    3. ICRs Regarding Notice of Nondiscrimination (Sec.  92.10) and 
Notice of Availability of Language Assistance Services and Auxiliary 
Aids and Services (Sec.  92.11)
    E. Assessment of Federal Regulation and Policies on Families

I. Background

    Section 1557 of the Affordable Care Act (ACA) (section 1557), 42 
U.S.C. 18116, prohibits discrimination on the basis of race, color, 
national origin, sex, age, or disability in a health program or 
activity, any part of which is receiving Federal financial assistance, 
including credits, subsidies, or contracts of insurance, except where 
otherwise provided in title I of the ACA. Section 1557 also prohibits 
discrimination on the basis of race, color, national origin, sex, age, 
or disability under any program or activity that is administered by an 
executive agency, or any entity established under title I of the ACA or 
its amendments. The statute cites title VI of the Civil Rights Act of 
1964 (title VI), 42 U.S.C. 2000d et seq., title IX of the Education 
Amendments of 1972 (title IX), 20 U.S.C. 1681 et seq., the Age 
Discrimination Act of 1975 (Age Act), 42 U.S.C. 6101 et seq., and 
section 504 of the Rehabilitation Act of 1973 (section 504), 29 U.S.C. 
794, to identify the grounds of discrimination prohibited by section 
1557. The entities to which section 1557 and this final rule apply 
(i.e., recipients of Federal financial assistance, the Department, and 
title I entities) are collectively referred to as ``covered entities.'' 
The statute further specifies that the enforcement mechanisms provided 
for and available under title VI, title IX, the Age Act, or section 504 
shall apply for purposes of violations of section 1557, 42 U.S.C. 
18116(a). The statute authorizes the Secretary of the U.S. Department 
of Health and Human Services (HHS or the Department) to promulgate 
implementing regulations for section 1557, 42 U.S.C. 18116(c).

A. Regulatory History

    On August 1, 2013, the HHS Office for Civil Rights (OCR) published 
a Request for Information in the Federal Register, 78 FR 46558,\1\ 
followed by issuance of a notice of proposed rulemaking (NPRM) on 
September 8, 2015 (2015 NPRM), 80 FR 54171.\2\ OCR finalized the first 
section 1557 regulation on May 18, 2016 (2016 Rule), 81 FR 31375. On 
June 14, 2019, the Department published a new section 1557 NPRM (2019 
NPRM), 84 FR 27846, proposing to rescind and replace large portions of 
the 2016 Rule.\3\ On June 12, 2020, OCR publicly posted its second 
section 1557 final rule (2020 Rule), which was published in the Federal 
Register on June 19, 2020, 85 FR 37160. The 2020 Rule remains in 
effect, save for the parts enjoined or set aside by courts, until the 
effective date of this final rule. In the meantime, entities that are 
subject to the 2020 Rule must continue to comply with the parts of the 
2020 Rule that remain in effect.
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    \1\ Responses are available for public inspection at https://www.regulations.gov/docket/HHS-OCR-2013-0007/comments.
    \2\ The 2015 NPRM received roughly 2,160 comments, which are 
available for public inspection at https://www.regulations.gov/docket/HHS-OCR-2015-0006/comments.
    \3\ The 2019 NPRM received roughly 198,845 comments, which are 
available for public inspection at https://www.regulations.gov/document/HHS-OCR-2019-0007-0001. This count includes bundled 
submissions, including petitions and form letter campaigns, which 
were counted as individual comment submissions.
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    On January 5, 2022, the Department proposed to amend CMS 
regulations such that Exchanges, issuers, and agents and brokers would 
be prohibited from discriminating against consumers based on their 
sexual orientation or gender identity in the HHS Notice of Benefit and 
Payment Parameters for 2023 NPRM, 87 FR 584 (January 5, 2022). CMS did 
not finalize the amendments in the Notice of Benefit and Payment 
Parameters for the 2023 final rule, 87 FR 27208 (May 6, 2022); instead, 
CMS proposed to make the amendments to its regulations in forthcoming 
Departmental rulemaking.
    On July 25, 2022, OCR publicly posted the section 1557 NPRM 
associated with this rulemaking (2022 NPRM or Proposed Rule), which was 
published in the Federal Register on August 4, 2022, 87 FR 47824. OCR 
invited comment on the Proposed Rule by all interested parties. The 
comment period ended on October 3, 2022. In total we received 85,280 
comments on the Proposed Rule.\4\ Comments came from a wide variety of 
stakeholders, including but not limited to: civil rights/advocacy 
groups, including language access organizations, disability rights 
organizations, women's advocacy organizations, and organizations 
serving lesbian, gay, bisexual, transgender, queer, or intersex 
(LGBTQI+) individuals; health care providers; consumer groups; 
religious organizations; academic and research institutions; 
reproductive health organizations; health plan organizations; health 
insurance issuers; State and local agencies; and tribal entities. Of 
the total comments, 79,126 were identified as being submitted by 
individuals. Of the 85,280 comments received, 70,337 (80 percent) were 
form letter copies associated with 30 distinct form letter campaigns.
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    \4\ This count includes bundled submissions, including 
petitions. The number of submission entries in the Federal Docket 
Management System is 75,254 submissions. Responses are available for 
public inspection at https://www.regulations.gov/docket/HHS-OS-2022-0012.
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B. Overview of the Final Rule

Section 1557
    This preamble is divided into multiple sections: section II 
describes changes to the section 1557 regulation and contains four 
subparts: subpart A sets forth the rule's general provisions; subpart B 
contains the rule's nondiscrimination provisions; subpart C describes 
specific applications of the prohibition on discrimination to health 
programs and activities; and subpart D describes the procedures that 
apply to enforcement of the rule. Section III provides official notice 
of HHS's change in interpretation that Medicare Part B meets the 
definition of ``Federal financial assistance.'' Section IV describes 
changes to CMS regulations.
    OCR has made some changes to the Proposed Rule's provisions, based 
on the comments we received. Among the changes are the following:
    OCR modified proposed Sec.  92.4 (Definitions) to include new 
definitions for telehealth, State, relay interpretation, and patient 
care decision support tools.
    OCR modified proposed Sec.  92.201 (Meaningful access for 
individuals with limited English proficiency) to change ``limited 
English proficient individual'' to ``individual with limited English 
proficiency'' where applicable in this provision and elsewhere where 
the term is used. The text for proposed Sec.  92.201(a) was updated to 
include ``companions with limited English proficiency'' for clarity and 
parity with the rule's effective communication

[[Page 37524]]

provision. OCR also modified proposed Sec.  92.201(f) and proposed 
Sec.  92.201(g) to address concerns that audio and video remote 
interpreting may not be appropriate to provide meaningful access in 
certain circumstances.
    OCR modified proposed Sec.  92.206 (Equal program access on the 
basis of sex) to clarify a covered entity's ability to raise legitimate 
and nondiscriminatory reasons for the denial of care under this 
provision, while stating that the basis for a denial or limitation must 
not be based on unlawful animus or bias, or constitute a pretext for 
discrimination.
    OCR modified the text of proposed Sec.  92.207 (Nondiscrimination 
in health insurance coverage and other health-related coverage), 
consistent with changes to Sec.  92.206(c) to clarify that covered 
entities may raise a legitimate, nondiscriminatory reason for denials 
or limitations of health services in benefit design and in individual 
cases, while stating that the basis for a denial or limitation must not 
be based on unlawful animus or bias, or constitute a pretext for 
discrimination.
    OCR revised proposed Sec.  92.210 (Nondiscrimination in the use of 
clinical algorithms in decision-making) to change ``clinical 
algorithms'' and ``clinical algorithms in decision-making'' to 
``patient care decision support tools.'' OCR further specified the 
scope of the application of this provision and the requirement that 
covered entities take reasonable steps to mitigate discrimination once 
made aware of the potential for discrimination resulting from use of 
these tools.
    OCR modified proposed Sec.  92.302 (Notification of views regarding 
application of Federal religious freedom and conscience laws) to 
clarify the application of religious freedom and conscience laws, and 
aspects of the administrative process set forth in the provision, 
including that a recipient may request an assurance of an exemption 
under such laws, the availability of a temporary exemption, and the 
availability of an administrative appeal process.
CMS Amendments
    In response to comments, CMS is finalizing the proposed amendments 
to the CMS regulations with a revision to scope of sex discrimination 
to be consistent with section 1557's regulatory text at Sec.  
92.101(a)(2).

II. Provisions of the Proposed Rule and Analysis and Responses to 
Public Comments

Subpart A--General Provisions

Purpose and Effective Date (Sec.  92.1)
    In the 2022 NPRM, proposed Sec.  92.1(a) explained that the purpose 
of 45 CFR part 92 is to implement section 1557, which prohibits 
discrimination in certain health programs and activities on the 
``ground[s] prohibited'' under title VI, title IX, the Age Act, or 
section 504. Section 1557 adopts the grounds of these statutes and 
prohibits discrimination based on race, color, national origin, sex, 
age, or disability.\5\
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    \5\ See Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 
945, 953 (9th Cir. 2020) (``Section 1557(a) incorporates only the 
prohibited `ground[s]' and `[t]he enforcement mechanisms provided 
for and available under' the four civil rights statutes. A 
prohibited `ground' for discrimination . . . is simply the protected 
classification at issue.'').
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    Proposed Sec.  92.1(b) provided that the effective date of the 
section 1557 implementing regulation shall be 60 days after the 
publication of a final rule in the Federal Register and provided a 
delayed implementation date (referred to as ``applicability date'' in 
this final rule) for provisions of this part that require changes to 
health insurance or group health plan benefit design.
    The comments and our responses regarding the purpose and effective 
date are set forth below.
    Comment: Several commenters noted that the regulatory purpose 
described in the 2022 NPRM strengthens nondiscrimination protections in 
health care, and appropriately aligns with section 1557's statutory 
text and Congressional intent.
    Response: As commenters noted, the 2022 NPRM's purpose is to 
prohibit discrimination in accordance with section 1557's statutory 
text. The Proposed Rule mirrors the statutory text and clarifies that 
the purpose of this rule is to regulate health programs and activities 
conducted and funded by the Department and those of title I entities. 
Thus, we maintain the regulatory language for Sec.  92.1(a) as proposed 
in the 2022 NPRM.
    Comment: One commenter observed that, in addition to title IX's 
general prohibition of discrimination on the ground of ``sex,'' section 
904 of title IX (20 U.S.C. 1684) also prohibits discrimination on the 
ground of blindness or severe vision impairment.
    Response: Both HHS's and the Department of Education's title IX 
regulations define title IX to exclude section 906. See 45 CFR 86.2(a); 
34 CFR 106.2(a). While 20 U.S.C. 1684 prohibits certain forms of 
discrimination on the ground of blindness or severe vision impairment, 
such conditions are disabilities and section 1557 prohibits 
discrimination on the basis of disability as it is the ``ground'' of 
discrimination prohibited by the statute's reference to section 504. 
Accordingly, we decline to revise the regulatory text at Sec.  92.1(a).
    Comment: OCR received many comments about the proposed 60-day 
effective date for requirements other than those related to health 
insurance or group health plan coverage benefit design. Commenters 
identified several tasks covered entities would need to accomplish to 
comply with the final rule requirements within the proposed 60 days, 
including updating existing policies and procedures; developing and 
reviewing new content; developing written communications with members 
and distributing written documents, including preparing additional 
mailings; and familiarizing themselves with new requirements and OCR-
provided tools and resources.
    Most of these commenters expressed concern that covered entities 
would not be able to develop and implement the required policies and 
procedures (Sec.  92.8) and notices (Sec.  92.10, Sec.  92.11), or 
complete the proposed training requirement (Sec.  92.9) within the 
allotted 60 days. A variety of commenters argued that the 60-day 
effective date for Sec. Sec.  92.7 through 92.11 would be unreasonable 
for all covered entities, requesting that OCR consider allowing covered 
entities more time to come into compliance with the final rule.
    Commenters' recommended compliance timeframes varied widely, from 
180 days to three years following publication of the final rule in the 
Federal Register. One commenter asked that, for the first 18 to 24 
months following publication of the final rule in the Federal Register, 
OCR's section 1557 enforcement efforts, including complaint 
investigations, primarily focus on providing covered entities technical 
assistance with respect to their section 1557 obligations.
    Response: OCR appreciates comments regarding the effective date and 
commenters' identification of factors influencing feasibility of a 
single effective date for all section 1557 requirements. We are 
maintaining the overall 60-day effective date related to the general 
prohibition on discrimination on the basis of race, color, national 
origin, sex, age, and disability. This is consistent with the approach 
taken with respect to the effective date of our previous

[[Page 37525]]

rulemakings.\6\ However, in light of the comments received, OCR has 
determined that it is reasonable to allow additional time for covered 
entities to comply with certain procedural requirements. The additional 
time will provide covered entities with the opportunity to properly 
designate a Section 1557 Coordinator and designee(s) (as applicable); 
develop and tailor to their respective organization's policies and 
procedures; train relevant staff; and develop their required notices. 
For this reason, we are adopting phased-in applicability dates for 
certain provisions, as reflected in the chart at the end of this 
section.
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    \6\ The 2016 Rule's effective date was 60 days after publication 
of the final rule, with the exception of the provisions on health 
insurance and benefit design, which went into effect the first day 
of the first plan year following the effective date. 81 FR 31375. 
The 2020 Rule's effective date was 60 days after publication, with 
no exceptions. 85 FR 37160.
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    Comment: Some commenters requested that OCR allow for temporary 
safe harbors for covered entities' compliance with certain aspects of 
the final rule. Specifically, commenters suggested that the final rule 
allow for an 18-month good faith safe harbor for covered entities 
currently operating in accordance with the 2016 Rule language access 
requirements, particularly the notice and tagline requirements at 
former 45 CFR 92.8.
    Response: OCR declines to grant safe harbors for covered entities 
that are or have been operating in accordance with the 2016 Rule's 
notice and tagline requirements. Granting such a safe harbor would fail 
to recognize the importance of this final rule's requirement. The 
Notice of Availability of Language Assistance Services and Auxiliary 
Aids and Services (``Notice of Availability'') at Sec.  92.11 requires 
notice of auxiliary aids and services in addition to language 
assistance services, which we have now revised to reflect a delayed 
applicability date of one year from the effective date. This revised 
applicability date reasonably allows enough time for covered entities 
to come into compliance with the Notice of Availability provision.
    Comment: Comments from organizational health insurance issuers 
generally supported the Proposed Rule's delayed applicability date for 
provisions that require changes to health insurance or group health 
plan coverage benefits or benefit design, which proposed a delayed 
applicability date of the first day of the first plan year beginning on 
or after the year following the effective date of the final rule's 
publication in the Federal Register.\7\ One commenter generally 
requested that OCR provide flexibility for plans depending on when the 
rule is finalized. Another commenter specifically requested that OCR 
consider allowing a temporary safe harbor compliance exception for 
group health plans and health insurance issuers of group health 
insurance coverage so that plan design changes for non-calendar-year 
plans may be implemented the first day of the new plan year occurring 
on or after January 1, 2024.
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    \7\ The term ``group health plan'' is generally used to refer to 
a health benefit arrangement that is a distinct legal entity and can 
also be used to refer to the underlying health coverage or benefits. 
For ease of reference, this document uses the term ``group health 
plan'' when referring the plan as a distinct legal entity and uses 
the term ``group health plan coverage'' to refer to the underlying 
health coverage or benefits provided by the group health plan.
---------------------------------------------------------------------------

    Response: OCR is cognizant that health insurance issuers and group 
health plans develop their health insurance coverage and other health-
related coverage benefit designs in advance of the plan year that the 
coverage is offered. Accordingly, we are including a delayed 
applicability date to the extent that the final rule's provisions 
require changes to health insurance coverage or other health-related 
coverage, including group health plan coverage benefit design for 
health insurance coverage or other health-related coverage that is 
newly subject to certain provisions of Sec.  92.207 (Nondiscrimination 
in health insurance coverage and other health-related coverage). In 
such circumstances, the final rule's applicability date is the first 
day of the first plan year beginning on or after January 1, 2025. This 
delayed applicability date applies equally to health insurance issuers 
and group health plans that are offering calendar-year and non-
calendar-year plans. For example, a newly covered group health plan 
eligible for the delayed applicability date that offers a non-calendar 
year plan effective July 1, 2024, would have until the following plan 
year, effective July 1, 2025, to comply with the benefit design 
requirements, as July 1, 2025, would be the first day of the first plan 
year beginning on or after January 1, 2025.
    The 2020 Rule remains in effect until the effective date of this 
final rule. In the interim, covered entities that are subject to the 
2020 Rule must continue to comply with the parts of the 2020 Rule that 
remain in effect. Notwithstanding the repeal of the former Sec.  92.207 
(2016 Rule), the 2020 Rule prohibits discrimination in health insurance 
coverage that receives Federal financial assistance. Consistent with 
the 2020 Rule preamble, OCR interprets and enforces section 1557 under 
the 2020 Rule to prohibit discrimination in benefit design in health 
insurance coverage and other health-related coverage that receive 
Federal financial assistance.\8\
---------------------------------------------------------------------------

    \8\ See 85 FR 37160 (stating the rule prohibits age 
discrimination, ``including [in] health plan marketing and benefit 
design''); id. at 37177 (stating that HHS ``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''); 
id. at 37201 (``OCR will examine carefully any allegations of 
discrimination by health insurance issuers, including through 
benefit design.'').
---------------------------------------------------------------------------

    As such coverage is currently prohibited from having discriminatory 
benefit designs, the obligation to comply with this final rule's Sec.  
92.207(b)(1) through (5) does not require a delayed applicability date. 
Therefore, we have revised the delayed applicability date for Sec.  
92.207(b)(1) through (5) under Sec.  92.1(b) to reflect that the 
delayed applicability date is for health insurance coverage and other 
health-related coverage that are not already subject to this part as of 
the date of publication of this final rule. Because Sec.  92.207(b)(6) 
(most integrated setting) describes a category of prohibited benefit 
design features that OCR is not explicitly enforcing under the 2020 
Rule, OCR will not enforce this provision until the delayed 
applicability of the first day of the first plan year beginning on or 
after January 1, 2025. The delayed applicability date for all 
provisions of Sec.  92.207 is in effect for covered health insurance 
coverage and other health-related coverage that are not subject to the 
2020 Rule as of the date of publication of this final rule and are 
therefore newly subject to this final rule.
    Examples of health insurance coverage or other health-related 
coverage subject to the 2020 Rule (and thus the benefit design 
provisions under Sec.  92.207(b)(1) through (5) as of July 5, 2024) 
include but are not limited to Medicare Advantage plans, Medicare Part 
D plans, Medicaid managed care plans, and qualified health plans.\9\ 
For complaints received prior to January 1, 2025 alleging 
discrimination related to benefit design, OCR will examine whether the 
health insurance coverage or other health-related coverage is subject 
to the 2020 Rule. If OCR determines the coverage was subject to

[[Page 37526]]

the 2020 Rule, the covered entity providing the coverage is responsible 
for complying with the specific benefit design provisions of Sec.  
92.207(b)(1) through (5) on July 5, 2024. In its review of such 
complaints, OCR will consider the nature of the challenged benefit 
design feature and whether it would have been prohibited under the 2020 
Rule. For example, a Medicare Advantage plan that imposes additional 
cost-sharing for health services related to a particular disease but 
not for other diseases would be investigated as potentially 
discriminatory under the 2020 Rule and under this final rule as of its 
general 60-day effective date. However, if a Medicare Advantage plan 
contains a potentially discriminatory design feature related to 
integration, OCR would not investigate such an allegation under this 
final rule unless the alleged discrimination took place after the 
delayed applicability date of the first day of the first plan year 
beginning on or after January 1, 2025.
---------------------------------------------------------------------------

    \9\ Qualified health plans are covered by the 2020 Rule as a 
program or activity administered by an entity established under 
title I of the ACA (i.e., an Exchange), pursuant to Sec.  
92.3(a)(3). See 85 FR 37174. Qualified health plans are also subject 
to the 2020 Rule to the extent they receive Federal financial 
assistance. Id.
---------------------------------------------------------------------------

    Further, OCR clarifies that any covered entity offering health 
insurance coverage or other health-related coverage subject to the 
delayed applicability date for benefit design is still required to 
comply with all other provisions of this final rule, as of the general 
effective dates and specific applicability dates set forth under Sec.  
92.1(b).
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions in Sec.  92.1(a) as 
written and amending Sec.  92.1(b), with modifications.
    In Sec.  92.1(b), we have included a table that clearly provides 
the applicability date for each provision. It appears below:

------------------------------------------------------------------------
 Section 1557 Requirement and     Date by which covered entities must
          provision                              comply
------------------------------------------------------------------------
Sec.   92.7 Section 1557       Within 120 days of effective date.
 Coordinator.
Sec.   92.8 Policies and       Within one year of effective date.
 Procedures.
Sec.   92.9 Training.........  Following a covered entity's
                                implementation of the policies and
                                procedures required by Sec.   92.8, and
                                no later than one year of effective
                                date.
Sec.   92.10 Notice of         Within 120 days of effective date.
 nondiscrimination.
Sec.   92.11 Notice of         Within one year of effective date.
 availability of language
 assistance services and
 auxiliary aids and services.
Sec.   92.207(b)(1) through    For health insurance coverage or other
 (5) Nondiscrimination in       health-related coverage that was not
 health insurance coverage      subject to this part as of the date of
 and other health-related       publication of this rule, by the first
 coverage.                      day of the first plan year (in the
                                individual market, policy year)
                                beginning on or after January 1, 2025.
Sec.   92.207(b)(6)            By the first day of the first plan year
 Nondiscrimination in health    (in the individual market, policy year)
 insurance coverage and other   beginning on or after January 1, 2025.
 health-related coverage.
Sec.   92.210(b), (c) Use of   Within 300 days of effective date.
 patient care decision
 support tools.
------------------------------------------------------------------------

Application (Sec.  92.2)
    Proposed Sec.  92.2 addressed the application of this regulation. 
OCR proposed in Sec.  92.2(a) to apply the final rule, except as 
otherwise provided in the regulation, to: (1) every health program or 
activity, any part of which receives Federal financial assistance, 
directly or indirectly, from the Department; (2) every health program 
or activity administered by the Department; and (3) every program or 
activity administered by a title I entity. Title I entities include 
State Exchanges (including those on the Federal platform) and 
Federally-facilitated Exchanges, both of which were created under title 
I of the ACA.\10\
---------------------------------------------------------------------------

    \10\ Section 1311 of the ACA (codified at 42 U.S.C. 18031) 
(establishing grants and requiring those grants to be used by States 
to create ``American Health Benefit Exchanges'') and section 1321(c) 
of the ACA (codified at 42 U.S.C. 18041(c)) (providing for the 
Secretary to establish an Exchange if a State elects not to 
establish an Exchange or fails to establish an Exchange under 
section 1311 of the ACA).
---------------------------------------------------------------------------

    In Sec.  92.2(b), we proposed that this regulation would not apply 
to an employer with regard to its employment practices, including the 
provision of employee health benefits. We noted that, although the 2016 
and 2020 Rules applied to employment in very limited circumstances, OCR 
determined that the proposed approach would minimize confusion among 
individuals seeking relief under Federal Equal Employment Opportunity 
laws and would promote clarity regarding the filing and processing of 
employment discrimination complaints. We stated our belief that, as is 
the case with employment discrimination complaints generally, concerns 
regarding the provision of employee health benefits are best resolved 
by our Federal partners.
    In Sec.  92.2(c), we proposed that if any provision of this 
regulation is held to be invalid or unenforceable by its terms, or as 
applied to any person or circumstance, it shall be severable from this 
part and not affect the remainder thereof or the application of the 
provision to other persons not similarly situated or to other, 
dissimilar circumstances.
    We invited comment on the effects of the proposed scope of 
application of the regulation, including the application of this part 
to recipients of Federal financial assistance from executive agencies 
other than the Department; the application to programs and activities 
of the Department and other executive agencies; and the application to 
employment.
    The comments and our responses regarding Sec.  92.2 are set forth 
below.
    Comment: Many commenters supported Sec.  92.2(a), which commenters 
said would reinstate the scope of the section 1557 implementing 
regulation to that of the 2016 Rule and recognizes that section 1557 
applies to Federal programs like Medicaid and Medicare, the State and 
Federal Marketplaces (referred to as ``Exchanges'' in this final rule) 
and the plans sold through them, as well as other commercial health 
plans if the issuer receives any form of Federal financial assistance. 
Commenters noted that ensuring section 1557 protections apply broadly 
to an array of entities and programs will ensure the greatest level of 
protection for individuals against discriminatory actions that may 
interfere with access to health care and health care coverage.
    Many commenters noted that the Proposed Rule was consistent with 
congressional intent. These commenters noted that Congress was clear in 
extending nondiscrimination protections to a broad array of health 
programs and activities, and that section 1557 was intended to build 
and expand upon existing civil rights laws, while

[[Page 37527]]

providing broad protection against discrimination in health care. These 
commenters further noted that Congress has repeatedly expressed that it 
intends civil rights laws to be broadly interpreted in order to 
effectuate their remedial purposes. Commenters also noted that the 
purpose of the ACA itself is to ensure broad access to and coverage of 
health care.
    Response: We agree that section 1557 protections apply broadly and 
that this final rule is the best reading of the statute regarding the 
scope of applicability; as such, the 2022 NPRM properly identified 
those entities that are covered under section 1557.
    Regarding plans sold through State and Federally-facilitated 
Exchanges, as discussed under the definition of ``Federal financial 
assistance'' at Sec.  92.4, such plans are covered under this rule as a 
health program or activity when in receipt of Federal financial 
assistance, such as advance payments of the premium tax credit. This is 
consistent with the 2016 Rule. Further, as discussed under the 
definition of ``health program or activity'' at Sec.  92.4, a health 
insurance issuer's other commercial health plans are covered under this 
final rule as part of the issuer's operations where the issuer is 
principally engaged in the provision or administration of any health 
projects, enterprises, ventures, or undertakings. For more information 
on the final rule's application to all operations of a health insurance 
issuer that is so principally engaged, please see the discussion below 
under the definition of ``health program or activity'' at Sec.  92.4.
    Comment: Some commenters requested that OCR clarify the extent to 
which a covered entity is required to oversee the section 1557 
compliance of its vendors and subcontractors. For example, a health 
insurance issuer commented that an issuer should not be responsible for 
the discriminatory actions of a provider or facility with which the 
issuer has contracted for the provision of medical services. Another 
commenter requested clarification on when health insurance agents and 
brokers are subject to the rule, particularly when they are working 
under the auspices of a covered entity, such as an Exchange or a health 
insurance issuer. Other commenters suggested that subcontractors should 
be considered recipients by virtue of contracting with a recipient of 
Federal financial assistance.
    Response: Health programs or activities may comprise more than one 
recipient of Federal financial assistance. For example, a primary 
recipient (or ``direct'' recipient) is an entity that accepts Federal 
financial assistance from a Federal agency. The direct recipient may 
then distribute the Federal financial assistance to a subrecipient (or 
``indirect'' recipient) to carry out all or part of the health program 
or activity. Primary recipients and all subrecipients are covered and 
must comply with section 1557.\11\ Under general civil rights 
principles, both the primary recipient and subrecipient are responsible 
for complying with applicable civil rights laws.\12\ Therefore, if an 
entity receives Federal financial assistance--directly as a primary 
recipient or indirectly as a subrecipient--it would be a covered entity 
and responsible for complying with section 1557 and the part.
---------------------------------------------------------------------------

    \11\ For further discussion of this issue, see U.S. Dep't of 
Justice, Title VI Legal Manual, sec. V.D.4.
    \12\ Often, a recipient receives funds with the purpose and 
expectation that it will distribute the funds to one or more sub-
grantees or indirect recipients. For example, in Moreno v. Consol. 
Rail Corp., 99 F.3d 782 (6th Cir. 1996) (en banc), the U.S. 
Department of Transportation provided funds to the State of Michigan 
for use in upgrading railroad crossings. The state, in turn, 
provided these funds to Conrail. The Sixth Circuit found that 
Conrail was a recipient of Federal financial assistance, noting 
``[i]t makes no difference, in our view, that the Federal funds of 
which Conrail is the recipient come to it through the State of 
Michigan rather than being paid to it by the United States 
directly.'' Id. at 787.
---------------------------------------------------------------------------

    While both direct and indirect recipients must comply with section 
1557 independently, a direct recipient may not absolve itself of its 
obligations by contracting with another entity to provide services or 
assistance for which it received Federal financial assistance or using 
an agent to do so.\13\ Covered entities are responsible for the conduct 
of their subcontractors and cannot contract away their civil rights 
obligations through contractual arrangements with subcontractors. For 
example, section 1557 and the statutes referenced therein may cover a 
contractor that performs an essential function for the recipient, 
making the contractor itself a recipient. In Frazier v. Board of 
Trustees, 765 F.2d 1278, amended, 777 F.2d 329 (5th Cir. 1985), a case 
involving section 504, the court noted that the defendant hospital 
contracted out core medical functions, for which it received Federal 
financial assistance. The court ruled that this financial assistance to 
the hospital ``would not have been [provided] at all were it not for 
[the contractor's] performance as a de facto subdivision of [the 
hospital],'' and thus the contractor qualified as a recipient for 
purposes of section 504, id. at 1289-90.\14\
---------------------------------------------------------------------------

    \13\ U.S. Dep't of Justice Title VI Legal Manual, Sec. V.D.5.
    \14\ But see Rose v. Cahee, 727 F. Supp. 2d 728, 739 (E.D. Wis. 
2010) (court declined to follow Frazier, limiting coverage of the 
funding assistance nondiscrimination cover the contractor of a 
recipient requirement to those entities receiving the funds directly 
and that ``are in a position to choose whether to do so'').
---------------------------------------------------------------------------

    The obligation of health insurance agents and brokers as 
subcontractors is a fact-specific analysis depending on the contractual 
arrangement with a covered entity. If an Exchange or recipient, such as 
a health insurance issuer, contracts with an agent or broker to carry 
out responsibilities of the covered entity's health program or activity 
and uses Federal financial assistance to pay the agent or broker, then 
the agent or broker is a subrecipient and thus independently subject to 
all the provisions of section 1557. If a contractor does not receive 
Federal financial assistance--either as a primary recipient or 
subrecipient--it is not a recipient of Federal financial assistance and 
not subject to section 1557. We note that agents and brokers under 
contract with an Exchange could also be covered by the final rule as a 
health program or activity administered by a title I entity under Sec.  
92.2(a)(3). Conversely, if the agent or broker is assisting the public 
with purchasing health insurance coverage without any contractual 
arrangement on behalf of an Exchange or recipient and is not otherwise 
receiving Federal financial assistance, then they would not be 
considered subrecipients or subcontractors subject to the rule.
    Comment: Some commenters stated that because the Federal Government 
now extensively subsidizes both medical care and health insurance 
coverage and other health-related coverage, the final rule will apply 
to practically all health care entities. They argued that because of 
this, it would be nearly impossible for medical professionals to work 
free of these regulations and, as a result, physicians and faith-based 
health care entities would effectively be barred from refusing to 
participate in pregnancy termination procedures.
    Response: It has long been established that when an entity receives 
Federal funds, conditions may be placed on the receipt of those 
funds.\15\ Not all providers receive Federal financial assistance; 
however, when they do, they must comply with applicable law. The

[[Page 37528]]

rule, however, does not ban physicians and faith-based or other health 
care entities from refusing to participate in pregnancy termination 
procedures. On the contrary, the ACA itself provides that ``[n]othing 
in this Act shall be construed to have any effect on Federal laws 
regarding--(i) conscience protection; (ii) willingness or refusal to 
provide abortion; and (iii) discrimination on the basis of the 
willingness or refusal to provide, pay for, cover, or refer for 
abortion or to provide or participate in training to provide 
abortion.'' 42 U.S.C. 18023(c)(2)(A).\16\ In addition, the rule has 
been revised at Sec.  92.3(c) to recognize that, ``[i]nsofar as the 
application of any requirement under this part would violate applicable 
Federal protections for religious freedom and conscience, such 
application shall not be required.'' Further, in this final rule, the 
process regarding exemptions related to religious freedom and 
conscience protections has been clarified. See Sec.  92.302.
---------------------------------------------------------------------------

    \15\ The Supreme Court has generally treated these civil rights 
statutes as enacted based on Congress's Spending Clause Power, which 
generally permits Congress to attach conditions to the receipt of 
Federal financial assistance. See Barnes v. Gorman, 536 U.S. 181, 
189 n.3 (2002) (referring to the Rehabilitation Act as ``Spending 
Clause legislation''); id. at 185-86 (``Title VI invokes Congress's 
power under the Spending Clause, U.S. Const., Art. 1. Sec.  8, cl. 
1, to place conditions on the grant of federal funds.'').
    \16\ The application of this final rule to covered entities with 
conscience or religious freedom objections are discussed more fully 
below in Sec. Sec.  92.3 (Relationship to other laws) and 92.302 
(Notification of views regarding application of Federal religious 
freedom and conscience laws).
---------------------------------------------------------------------------

    Comment: Some commenters supported the restoration of section 
1557's application to all health programs or activities administered by 
the Department under Sec.  92.2(a)(2). These commenters noted that the 
2020 Rule exempts from section 1557 most of the Department's programs 
and activities by limiting the application to only those programs and 
activities established under title I of the ACA. These commenters 
opined that such an interpretation is contrary to the statutory text, 
design, and intent of section 1557 and the ACA generally. Other 
commenters noted that consistently applying section 1557 requirements 
throughout various programs, including the Department's programs, 
creates continuity in the interpretation and implementation of 
nondiscrimination standards. However, some commenters stated that OCR 
did not provide adequate explanation as to why this change in 
application is necessary or appropriate.
    Response: For the reasons discussed in the 2022 NPRM, 87 FR 47838, 
applying this rule to all health programs and activities administered 
by the Department, not just those programs and activities established 
under title I of the Act, is the best reading of the statutory text of 
section 1557. The statutory language provides that section 1557's 
discrimination prohibitions apply to ``any program and activity that is 
administered by an executive agency or any entity established under 
this title.'' 42 U.S.C. 18116(a). As discussed in the 2022 NPRM, the 
operative word, ``or,'' distinguishes programs and activities operated 
by an executive agency from those operated by a title I entity. 87 FR 
47829. To the extent there is ambiguity in the interpretation, 
finalizing the rule as proposed better reflects the statutory language 
as well as Congress's intent.\17\ The application of section 1557 to 
every health program or activity administered by the Department ensures 
that nondiscrimination standards are interpreted and applied as 
consistently and as broadly as possible and provides for application of 
nondiscrimination standards to the Department consistent with the 
entities to which it provides Federal financial assistance.
---------------------------------------------------------------------------

    \17\ See, e.g., Griffin v. Breckenridge, 403 U.S. 88, 97 (1971) 
(civil rights statutes should be construed broadly); U.S. v. Price, 
383 U.S. 787, 801 (1966) (same); see also N. Haven Bd. of Educ. v. 
Bell, 456 U.S. 512, 521 (1982) (``[I]f we are to give Title IX the 
scope that its origins dictate, we must accord it a sweep as broad 
as its language.''); S. Rep. No. 64, 100th Cong., 2d Sess. 5-7 
(1988), reprinted in 1988 U.S.C.C.A.N. 3, 7-9 (statement of Sen. 
Humphrey stating that title VI should be interpreted as broadly as 
necessary to eradicate discriminatory practices in programs that 
Federal funds supported).
---------------------------------------------------------------------------

    Comment: Some commenters noted that under the most straightforward 
reading of section 1557, the regulatory framework should encompass all 
of the Department's programs and activities, not just ``health'' 
programs and activities, and they suggested that the Department extend 
the regulation's protections accordingly.
    Response: We appreciate commenters' views on this issue. As we 
noted in the 2022 NPRM, OCR considered applying the rule to all 
programs and activities of the Department and sought comment on this 
issue. 87 FR 47838. Based on comments received and additional 
consideration, we are applying the final rule to the Department's 
health programs and activities, rather than all the Department's 
programs and activities, at this time. The Department may consider 
future rulemaking at a later date. For this final rule, however, OCR 
has determined that it is appropriate to apply the rule to the 
Department's ``health'' programs and activities given that the ACA 
itself is principally related to health care and the entirety of this 
section 1557 rulemaking seeks to regulate ``health'' programs and 
activities.
    Comment: Commenters supported the rule's application to programs 
and activities administered by title I entities under Sec.  92.2(a)(3), 
stating it was consistent with statutory text, Congressional intent, 
and the nondiscrimination purpose of section 1557 and the ACA.
    Response: Proposed Sec.  92.2(a)(3) applied section 1557 to ``every 
program or activity administered by a title I entity.'' In the 2022 
NPRM, 87 FR 47838, OCR explained that it was unnecessary to include the 
modifier ``health'' to programs or activities of a title I entity 
because title I entities already meet the definition of ``health 
program or activity'' as set forth under Sec.  92.4. While this remains 
true, we have reevaluated the regulatory text of Sec.  92.2(b)(3) and 
determined that it should be revised to add the modifier ``health'' to 
a title I entity's ``program or activity'' for consistency with our 
interpretation that section 1557 applies to the Department's ``health'' 
programs or activities, as discussed in the previous comment. This 
technical revision does not limit or alter the scope of Sec.  
92.2(b)(3)'s application to the programs or activities of a title I 
entity, as we articulated in the 2022 NPRM. 87 FR 47838.
    Comment: A few commenters opined that the rule should apply broadly 
to recipients of Federal financial assistance from any executive 
agency, not just the Department. These commenters noted that nothing in 
the statute suggests that Congress intended to limit the scope of 
section 1557's application in such a way.
    Response: It is OCR's longstanding position that section 1557's 
discrimination prohibition is not limited to recipients of Federal 
financial assistance from the Department, but rather covers recipients' 
health programs or activities regardless of the executive agency 
providing the funding.\18\ However, the final rule only applies to 
recipients of HHS funding, which is consistent with OCR's delegation of 
authority to ``develop and direct implementation of the requirements of 
Section 1557 . . . as applied to the Department and recipients of the 
Department's funds.'' 85 FR 37242 (emphasis added). Other Federal 
agencies possess section 1557 enforcement responsibility for the health 
programs and activities they fund and administer.
---------------------------------------------------------------------------

    \18\ See U.S. Health & Hum. Servs., Off. for Civil Rts., Memo. 
from Jocelyn Samuels, Director, to Directors of Federal Offices for 
Civil Rights (Nov. 5, 2015), https://www.hhs.gov/sites/default/files/2015_11_04_fed_civil_rights_section_1557_memo_508.pdf.
---------------------------------------------------------------------------

    Comment: Some commenters recommended that the Department provide a 
model for other agencies to craft their own, more inclusive, and

[[Page 37529]]

more protective rules for non-health-related programs in line with 
other applicable non-discrimination statutes.
    Response: OCR appreciates this recommendation and reiterates its 
desire to work with other agencies as necessary and appropriate. OCR 
only has authority to apply section 1557 to HHS and recipients of 
Departmental Federal financial assistance. This rule does not apply to 
programs and activities of other agencies and OCR is unable to regulate 
other agencies.
    Comment: A number of commenters disagreed with the non-application 
of the rule to employment practices under Sec.  92.2(b). Commenters 
opined that the categorical exclusion of employers is inconsistent with 
section 1557's statutory text and creates confusion. Some commenters 
noted that an agency to whom a complaint is referred may not adequately 
address claims of discrimination, including those of dependents. 
Commenters further noted that other employment discrimination laws, 
such as title VII of the Civil Rights Act of 1964 (title VII), 42 
U.S.C. 2000e et seq., and the Age Discrimination in Employment Act of 
1967 (ADEA), 29 U.S.C. 621-634, require a claimant to file a complaint 
with a Federal agency before privately enforcing their rights. Some 
commenters requested that OCR clarify that this provision concerns only 
the processing of administrative complaints by OCR and that OCR's 
decision not to apply this rule to employment practices does not 
preclude employees from vindicating their section 1557 rights in court.
    Other commenters supported proposed Sec.  92.2(b) and noted it will 
help prevent wasteful duplication with other Federal laws and agencies 
that already cover unlawful employment discrimination.
    Response: The Supreme Court has recognized that section 1557 
authorizes a private right of action.\19\ This final rule applies only 
to OCR's administrative enforcement of section 1557. As discussed in 
the 2022 NPRM, 87 FR 47838, we believe that other Federal agencies are 
better equipped to review and adjudicate employee health benefits and 
allegations of employment discrimination given their expertise under 
the existing employment nondiscrimination statutes they enforce.
---------------------------------------------------------------------------

    \19\ Cummings v. Premier Rehab Keller, P.L.L.C., 596 U.S. 212 
(2022) (section 1557 provides a private right of action because the 
incorporated statutes do so).
---------------------------------------------------------------------------

    Comment: Some commenters noted that employers are usually the 
sponsors of group health plans and raised concerns that OCR could 
therefor find an employer liable under section 1557 for the employee 
benefits it provides.
    Response: This rule does not apply to employers or other plan 
sponsors with regard to their employment practices, including the 
provision of employee health benefits. As stated in the preamble to the 
Proposed Rule, 87 FR 47838, previous rules had limited application to 
employment. The 2016 Rule provided that employment practices included 
hiring, firing, promotions, or terms and conditions of employment, and 
therefore the 2016 Rule did not apply to those practices. However, the 
2016 Rule applied to an employer with regard to its employee health 
benefit programs under certain circumstances as set forth under former 
Sec.  92.208. The 2020 Rule, which repealed the 2016 Rule's reference 
to employment practices and employee health benefit programs, reverted 
to enforcing the statutorily referenced nondiscrimination statutes 
through their existing regulations. As discussed above, the Proposed 
Rule proposed to exclude employment practices, which included the 
provision of employee health benefit programs. OCR also recognizes that 
other sponsors of group health plans undertake similar employment 
practices, such as the provision of employee health benefits. For 
example, a joint board of trustees for a multi-employer group health 
plan (also known as a Taft-Hartley plan) consists of representatives 
from employers and unions to sponsor a group health plan, and similarly 
engages in the provision of an employee health benefit like employers 
that sponsor a single-employer plan. To ensure consistent application 
of the rule to entities engaging in similar employment functions, the 
final rule revises Sec.  92.2(b) to provide that the rule does not 
apply to any employer or other plan sponsor of a group health plan, 
including but not limited to, a board of trustees (or similar body), 
association or other group, with regard to employment practices, 
including the provision of employee health benefits.
    Group health plans, employers, and sponsors of group health plans 
are generally separate entities from one another that require a 
separate, fact-specific analysis to determine whether each entity is 
subject to this rule. We discuss the relationship between plan 
sponsors, such as employers, joint boards of trustees or similar 
bodies, associations, and other groups that are plan sponsors of multi-
employer Taft-Hartley plans or multiple-employer welfare arrangements 
(MEWAs), and group health plans in more detail in the discussion of 
group health plans in the ``health program or activity'' definition 
discussion under Sec.  92.4.
    Comment: Some commenters stated that ongoing litigation surrounding 
section 1557 and previous iterations of OCR's section 1557 regulations, 
as well as agency course reversal on multiple occasions, has created 
confusion and compliance burden on covered entities. They urged the 
Department to reinforce the importance of severability under Sec.  
92.2(c) amongst the various regulatory provisions of the rule.
    Response: We appreciate concerns around ongoing litigation and 
agency reversal, and the resulting inconsistency in requirements. OCR 
has attempted to answer questions and reduce confusion raised by the 
previous versions of the rule. While this final rule is similar to the 
2016 Rule, it provides greater clarity regarding section 1557's 
statutory protections from discrimination along with various provisions 
to help alleviate burdens while providing certainty about covered 
entities' obligations when compared to the 2016 and 2020 Rules. We 
believe the final rule enhances the benefits to individuals and 
minimizes the burdens on covered entities.
    OCR notes that Sec.  92.2(c) provides that if any provision of this 
part is held to be invalid or unenforceable by its terms, or as applied 
to any person or circumstance, it shall be severable from this part and 
not affect the remainder thereof or the application of the provision to 
other persons not similarly situated or to other, dissimilar 
circumstances. For example, if a court were to invalidate the final 
rule's Notice of availability of language assistance services provision 
(Notice of Availability) at Sec.  92.11, all other provisions of the 
rule would remain in effect, as those provisions ``could function 
sensibly without the stricken provision.'' \20\ Thus, if the rule's 
Notice of Availability provision were invalidated, OCR would not 
enforce that provision. Or, for example, if a court were to invalidate 
the final rule's Section 1557 Coordinator requirement at Sec.  92.7, 
OCR would not require covered entities to fill this position as part of 
their compliance with this final rule, while otherwise enforcing other 
administrative requirements such as the Policies and procedures 
requirement at Sec.  92.8 and the Notice of nondiscrimination 
requirement at Sec.  92.10.
---------------------------------------------------------------------------

    \20\ MD/DC/DE Broadcasters Ass'n v. F.C.C., 253 F.3d 732, 734 
(D.C. Cir. 2001) (internal quotations omitted).
---------------------------------------------------------------------------

    Comment: Some commenters requested that the final rule restore the 
2016 Rule clarification that any age

[[Page 37530]]

distinctions exempt from the Age Act are also exempt from section 1557 
enforcement.
    Response: OCR appreciates commenters' request for clarity and 
directs commenters to Sec.  92.101(b)(1) of this regulation, which 
adopts by reference the permissible uses of age located in the 
Department's Age Act regulations at 45 CFR part 91 (subpart B).
    Comment: Some commenters argued that the Proposed Rule is 
inappropriate for the Indian Health Services (IHS) facilities because 
these are not open to members of the public but reserved for patients 
who are eligible beneficiaries as citizens of Tribal Nations, and as 
such, tribally operated IHS health facilities \21\ should be exempt. 
These commenters stated that the 2022 NPRM failed to recognize the 
unique nature of the Indian Health Care System, which is the health 
care system for members of federally recognized Tribes in the United 
States. Commenters recommended that OCR acknowledge American Indian/
Alaska Native (AI/AN) as a political classification, and not as a race-
based classification. Commenters further opined that the 2022 NPRM 
failed to recognize the diplomatic, nation-to-nation relationship 
between Tribal Nations and the United States.
---------------------------------------------------------------------------

    \21\ Titles I and V of the Indian Self-Determination and 
Education Assistance Act, Pub. L. 93-638, as amended, provide Tribes 
the option of exercising their right to self-determination by 
assuming control and management of programs previously administered 
by the Federal Government. Since 1992, the IHS has entered into 
agreements with tribes and tribal organizations to plan, conduct, 
and administer programs authorized under section 102 of the Act. 
Today, over sixty percent of the IHS appropriation is administered 
by tribes, primarily through self-determination contracts or self-
governance compacts. U.S. Dep't of Health & Hum. Servs., Indian 
Health Servs., IHS Profile, https://www.ihs.gov/newsroom/factsheets/ihsprofile/.
---------------------------------------------------------------------------

    Response: OCR appreciates these comments. Similar concerns were 
raised during the 2022 NPRM Tribal Consultation held on August 31, 
2022, pursuant to Executive Order 13175. The IHS, an agency within the 
Department, is responsible for providing health services to members of 
federally recognized tribes in 37 states, arising out of the special 
government-to-government relationship between the Federal Government 
and Indian tribes.\22\
---------------------------------------------------------------------------

    \22\ U.S. Dep't of Health & Hum. Servs., Indian Health Servs., 
About IHS, https://www.ihs.gov/aboutihs/.
---------------------------------------------------------------------------

    Membership or eligibility in a federally recognized tribal entity 
is a political classification rather than a racial classification.\23\ 
Preferences based upon the unique relationship between the United 
States and federally recognized tribal entities are distinct from the 
forms of discrimination prohibited by Federal civil rights laws, which 
aim to protect all individuals on the basis of race, color, or national 
origin (including AI/AN individuals, regardless of political 
affiliation).\24\ The Department's regulations implementing title VI 
provide that an individual shall not be deemed subjected to 
discrimination by reason of their exclusion from benefits limited by 
Federal law to individuals of a different race, color, or national 
origin. 45 CFR 80.3(d) (Indian Health and Cuban Refugee Services). IHS 
is mentioned in the Department's title VI regulation as an example of 
such a program. Id. In Sec.  92.101(b), the final rule adopts this 
provision by reference, and OCR will fully apply it, as well as other 
applicable exemptions or defenses that may exist under Federal law.
---------------------------------------------------------------------------

    \23\ See Morton v. Mancari, 417 U.S. 535, 553 & n.24 (1974).
    \24\ See Morton v. Mancari, 417 U.S. 535, 550 (1974) (``[a] 
provision aimed at furthering Indian self-government by according an 
employment preference withing the [Bureau of Indian Affairs] for 
qualified members of the governed group can readily co-exist with a 
general rule prohibiting employment discrimination on the basis of 
race.'').
---------------------------------------------------------------------------

    Programs of the IHS are administered by IHS and tribes, including 
through self-determination contracts or self-governance compacts, and 
we intend to address any restrictions on application of the law to IHS 
programs in the context of individual complaints.
    Comment: Some commenters requested that OCR develop an online tool 
that would help covered entities determine whether the final rule 
applies either directly or indirectly to an organization or other 
health program or activity.
    Response: OCR provides various tools on our website to help covered 
entities determine their covered entity status and will continue to 
ascertain what tools would help the industry ensure widespread 
compliance. OCR notes that the Department's Office of Grants operates a 
website that tracks obligated Department grant funds, https://taggs.hhs.gov/, which allows the public to identify recipients of 
Department funding.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.2, with modification. We are revising Sec.  92.2(a)(3) to add 
the modifier ``health'' to ``program or activity administered by a 
title I entity.'' We are also revising Sec.  92.2(b) to state that the 
provisions of this part shall not apply to any employer ``or other a 
plan sponsor of a group health plan, including but not limited to, a 
board of trustees (or similar body), association or other group,'' with 
regard to its employment practices, including the provision of employee 
health benefits.
Treatment of the Title IX Religious Exception
    In the 2022 NPRM, OCR proposed to not import the title IX religious 
exception into the section 1557 regulation. The title IX statute states 
that the nondiscrimination requirements ``shall not apply to an 
educational institution which is controlled by a religious 
organization'' to the extent that such application ``would not be 
consistent with the religious tenets of such organization.'' 20 U.S.C. 
1681(a)(3), as amended Public Law 100-259, section 3(b), Mar. 22, 1988, 
102 Stat. 29. The title IX statutory definition of ``program or 
activity'' further limits the nondiscrimination requirements, in that 
they do not apply to ``any operation of an entity which is controlled 
by a religious organization if the application of section 1681 of this 
title to such operation would not be consistent with the religious 
tenets of such organization.'' Id. at 1687(4).
    In the 2022 NPRM, we said that under the most natural understanding 
of section 1557's text, which bans discrimination ``on the ground 
prohibited under . . . title IX,'' the statutory term ``ground 
prohibited'' is best understood as incorporating only the bases on 
which discrimination is prohibited in the referenced statutes (i.e., 
``sex'' in title IX). 87 FR 47839. Rather than import the title IX 
exception for ``educational institution[s]'' that are controlled by 
``religious organization[s],'' OCR proposed that the best way to 
address religious objections to the application of this rule--and the 
way most consistent with section 1557's statutory text and structure--
would be through the process provided in proposed Sec.  92.302. We 
sought comment on this approach. We particularly invited comments from 
covered entities controlled by or affiliated with religious 
organizations, providers employed by such entities, and people who 
receive health care from religiously affiliated medical providers.
    The comments and our responses regarding this request for comment 
are set forth below.
    Comment: Commenters provided mixed responses to OCR's proposal not 
to import the title IX religious exception into this rule. Many 
commenters supported OCR's statutory interpretation that section 1557

[[Page 37531]]

incorporated the title IX statute only with respect to the ground of 
discrimination prohibited (sex) and its enforcement mechanisms (e.g., 
termination of Federal financial assistance and other means authorized 
by law). Several commenters stated that this reading is most consistent 
with the statutory structure, because if Congress intended for the 
title IX religious exception to apply, the statute would also require 
the importation of the other title IX exceptions, many of which are by 
their terms plainly inapplicable in the context of health care.
    Several commenters also stated that if Congress wanted to include 
the title IX religious exception, it could have either explicitly 
referenced or listed the exception in the section 1557 statutory text. 
Many commenters stated that any silence regarding the title IX 
exceptions was not an oversight by Congress, but an intentional 
decision. Many commenters contended that importing the title IX 
religious exception is contrary to the purpose of section 1557 and the 
goal of the ACA: to expand access to health care coverage. 
Additionally, many commenters said that importing the title IX 
religious exception is unnecessary given the numerous other Federal 
laws that allow religious organizations and providers to invoke a 
conscience or religious objection to providing certain kinds of medical 
services and care.
    Many other commenters disagreed with OCR's interpretation, claiming 
that Congress intended to incorporate the entire title IX statutory 
scheme by including the signal ``et seq.'' Several commenters also 
argued that title IX's prohibition on sex discrimination cannot be read 
separate and apart from all the exceptions included in the title IX 
statute, in which Congress authorized certain conduct--i.e., otherwise 
prohibited sex discrimination. Accordingly, several commenters 
maintained that it is arbitrary and capricious for OCR to rely upon 
title IX's implementing regulations as a guide to prohibit 
discrimination on the basis of sex, such as those related to pregnancy-
related conditions, or when distinguishing a marital, parental, and 
family status, while not importing the statute's religious exception.
    A few commenters maintained that the differences between 
educational and health care institutions provide an unconvincing 
argument for nonimportation of the title IX religious exception because 
under the Title IX Common Rule of 2000 (Common Rule),\25\ title IX 
already applies to recipients of Federal financial assistance that 
provide health care. Many commenters also asserted that the court in 
Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), 
found that the decision not to import the title IX religious exception 
into the 2016 Rule, without explanation, was contrary to law. Several 
commenters also pointed to that court's determination that the 
Department had previously ``provide[d] that when cross-referencing the 
provisions of Title IX's use of `student,' the term `individual' should 
be used in the healthcare context.'' Id. at 691. Commenters asserted 
that this finding by the court undermines the Department's claim that 
the title IX religious exception is specific to education and cannot be 
adopted more broadly in the health care context.
---------------------------------------------------------------------------

    \25\ Nondiscrimination on the Basis of Sex in Education Programs 
or Activities Receiving Federal Financial Assistance, 65 FR 52857 
(Aug. 30, 2000) (multiagency rulemaking adopting consistent title IX 
implementing regulations).
---------------------------------------------------------------------------

    Response: Title IX applies to ``any education program or activity'' 
operated by recipients of Federal financial assistance, and the statute 
creates an exception from coverage for the education programs and 
activities of ``an educational institution which is controlled by a 
religious organization if the application of [title IX's prohibition on 
sex discrimination in education programs and activities] would not be 
consistent with the religious tenets of such organization.'' 20 U.S.C. 
1681(a)(3). In addition, the Civil Rights Restoration Act of 1987 
(CRRA) \26\ statutorily defined ``program or activity'' for title IX to 
exclude from coverage ``any operation of an entity which is controlled 
by a religious organization if the application of section 1681 of this 
title to such operation would not be consistent with the religious 
tenets of such organization.'' 20 U.S.C. 1687(4). The preamble to the 
2020 Rule stated that section 1557 ``incorporates the statutory scope 
of Title IX, so it is appropriate for this rule to incorporate the 
Title IX statutory language concerning religious institutions.'' 85 FR 
37208.
---------------------------------------------------------------------------

    \26\ Public Law 100-259, 102 Stat. 28 (Mar. 22, 1988).
---------------------------------------------------------------------------

    OCR notes that as an initial matter, the CRRA's exclusion of any 
operation of religiously controlled entities from the application of 
title IX to the extent such operation is inconsistent with the 
religious tenets of the organization is not incorporated into section 
1557. As we explain further in the discussion of ``health program or 
activity,'' section 1557 includes its own coverage provision that does 
not incorporate the CRRA's definitions of ``program or activity.'' 
Moreover, unlike title VI, section 504, and the Age Act,\27\ title IX 
modifies ``program or activity'' with ``education,'' 20 U.S.C. 1681(a), 
which limited title IX's prohibition on sex discrimination to the 
``education'' context; the definitions of ``program or activity'' under 
title VI, section 504, or the Age Act do not include any comparable 
exclusion for the operations of religiously controlled entities.\28\ 
Thus, the CRRA's limitation to the application of certain operations of 
religious entities from title IX's coverage applies only in the 
``education'' context and is not part of the definition of ``program or 
activity'' as that term is used in civil rights statutes more 
generally. Further, it is inapplicable to the definition of ``health 
program or activity'' adopted in section 1557. As a result, the sole 
question is whether the exclusion in title IX, 20 U.S.C. 1681(a)(3), of 
certain applications of the statute to ``educational institution[s] 
which [are] controlled by a religious organization'' carries over into 
section 1557.
---------------------------------------------------------------------------

    \27\ See 42 U.S.C. 2000d (title VI, prohibiting ``discrimination 
under any program or activity receiving Federal financial 
assistance''); 42 U.S.C. 6101 (the Age Act, prohibiting 
discrimination ``in programs or activities receiving Federal 
financial assistance''); 29 U.S.C. 794(a) (section 504 prohibiting 
``discrimination under 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'').
    \28\ S. Rep. No. 100-64, 100th Cong., 1st Sess. (1987), as 
reprinted in 1988 U.S.C.C.A.N. 3, 6, 1987 WL 61447, at *18 
(discussing ``education limitation in Title IX''); see also id. at 
*20-*21 (``[The CRRA] leaves the religious tenet exemption in Title 
IX intact and clarifies that the exemption is as broad as the Title 
IX coverage of education programs and activities.'' (Emphasis 
added)).
---------------------------------------------------------------------------

    Although title IX's prohibition of sex discrimination applies to 
some health-related activities of covered education programs--such as 
programs training future health workers--the range of exceptions 
provided in section 1681(a) are plainly tied to the educational setting 
(e.g., the membership practices of social fraternities and sororities, 
YMCA, Girls Scouts, Boys Scouts; voluntary youth service organizations; 
father-son and mother-daughter activities; and beauty pageant-based 
scholarships, as well as educational admissions practices). All of 
these exceptions have little if any application to health programs and 
activities. Further, exceptions listed in that subsection include 
limitations regarding ``educational institution[s],'' ``institution[s] 
of public higher education,'' or ``institution[s] of higher 
education.'' 20 U.S.C. 1681(a)(1)-(9).

[[Page 37532]]

    The language and subject matter of the exceptions suggest that 
Congress, in enacting title IX, did not intend those exceptions to 
define the statute's basis of discrimination--what section 1557 calls 
the ``ground prohibited''--under title IX. Title IX prohibits 
discrimination on the basis of sex, so the ``ground prohibited'' under 
that statute is sex. Congress intended these exceptions to delineate 
certain contexts in which otherwise prohibited sex discrimination in 
the educational context would be excluded from the statute's coverage. 
Congress could have chosen to draft section 1557 to incorporate 
additional elements from title IX and the other referenced civil rights 
statutes (e.g., those statutes' applicability provisions), but did not 
do so, instead narrowly specifying that only the ``ground[s] 
prohibited'' are incorporated.
    OCR further notes that the inclusion of ``et seq.'' is simply part 
of an ordinary citation to the title IX statute. Congress frequently 
appends ``et seq.'' to statutory citations as a matter of course when 
legislation includes a generalized reference to a previously enacted 
statute.\29\ Including ``et seq.'' does not change the substantive 
meaning of section 1557, which incorporates only the grounds of 
prohibited discrimination and the enforcement mechanisms of each 
referenced statute. Further, section 1557 includes similar 
parenthetical citations with ``et seq.'' for the other referenced civil 
rights statutes in both 42 U.S.C. 18116(a) and (b). This underscores 
that Congress merely intended to provide the general, ordinary citation 
to the statutes being referenced, including title IX.
---------------------------------------------------------------------------

    \29\ See, e.g., 20 U.S.C. 1689(a)(1) (requesting a task force 
``provide pertinent information . . . with respect to campus sexual 
violence prevention, investigations, and responses, including the 
creation of consistent, public complaint processes for violations of 
title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et 
seq.)[.]''); accord id. 1689(a)(8), (b)(1), (c).
---------------------------------------------------------------------------

    Section 1557's role as a health care statute further reinforces our 
reading of the statutory text and Congressional intent. Section 1557 
was enacted as part of the ACA, in part, to expand access to health 
insurance and increase consumer protections. Title IX, as we have 
explained, relates specifically to education programs and activities. 
The title IX religious exception in that statute allows some entities 
to engage in certain conduct without requiring any consideration or 
mitigation of harm to third parties. If a similar standard were 
imported into this rule, it could undermine a key purpose of section 
1557--ensuring access to health care. And as discussed below, unlike 
educational settings such as colleges and universities where there is 
more choice, individuals often have far fewer choices when accessing 
health care. In the federally funded health care context, the array of 
statutory conscience provisions enacted by Congress, as well as the 
general requirements of the First Amendment and the Religious Freedom 
Restoration Act (RFRA), provide a better fitting approach to addressing 
the relevant interests. This final rule has been revised to include 
regulatory text at Sec.  92.3(c) recognizing that, insofar as the 
application of any rule requirement would violate applicable Federal 
protections for religious freedom and conscience, such application 
shall not be required. Also, we have strengthened the process for 
raising religious freedom and conscience protections under this final 
rule at Sec.  92.302.
    The fact that title IX and agency implementing regulations apply to 
some health programs and activities--those that are part of educational 
programs and activities \30\--does not suggest that the exceptions set 
forth in the statute or implementing regulations apply to health 
programs and activities that are not a part of an educational program. 
Title IX's limitation to a recipient's education programs and 
activities has long been established.\31\ For example, the Common Rule 
(adopted by more than 20 Federal agencies) included the statute's 
limitation that the prohibition on sex discrimination applied only to 
the educational components of a covered entity's program.\32\ As we 
have explained, it is inconsistent with the text and purpose of section 
1557, as well as the text and structure of title IX, to apply the title 
IX exceptions outside of the educational setting. Although the title IX 
regulations are relevant to informing what constitutes sex 
discrimination for purposes of this final rule--and we have looked to 
them for that purpose--that is because section 1557 incorporates the 
``ground prohibited'' under title IX. But section 1557 does not 
incorporate any of the title IX exceptions. 87 FR 47839.
---------------------------------------------------------------------------

    \30\ See, e.g., Doe v. Mercy Cath. Med. Ctr., 850 F.3d 545, 555 
(3d Cir. 2017) (holding that a hospital's residency program was an 
educational program or activity under title IX).
    \31\ See O'Connor v. Davis, 126 F.3d 112, 117 (2d Cir. 1997), 
cert. denied, 522 U.S. 1114 (1998) (under title IX a program or 
activity must be ``such that one could reasonably consider its 
mission to be, at least in part, educational''); see also Jeldness 
v. Pearce, 30 F.3d 1220, 1224-25 (9th Cir. 1994); Klinger v. Dep't 
of Corrs., 107 F.3d 609, 613-16 & n.5 (8th Cir. 1997); Roubideaux v. 
North Dakota Dep't of Corrs. & Rehab., 570 F.3d 966, 976-79 (8th 
Cir. 2009).
    \32\ Nondiscrimination on the Basis of Sex in Education Programs 
or Activities Receiving Federal Financial Assistance, 65 FR 52858, 
52868 (Aug. 30, 2000).
---------------------------------------------------------------------------

    OCR disagrees with the Franciscan Alliance decision vacating 
portions of the 2016 Rule, and in any event, that decision does not 
prohibit OCR from not importing the title IX religious exception in 
this final rule. The promulgation of this final rule constitutes new 
rulemaking, and OCR has provided a detailed explanation for the 
decision to not import the title IX religious exception and has taken 
important steps to address religious freedom and conscience protections 
beyond those in the 2016 Rule. These steps include revisions at Sec.  
92.3(c) to recognizes that, ``[i]nsofar as the application of any 
requirement under this part would violate applicable Federal 
protections for religious freedom and conscience, such application 
shall not be required,'' adoption of a voluntary assurance of exemption 
process based on these protections at Sec.  92.302, and the 
Department's issuance of a final rule entitled Safeguarding the Rights 
of Conscience as Protected by Federal Statutes, 89 FR 2078 (Jan. 11, 
2024).
    OCR notes that this final rule does not alter or eliminate a 
recipient's ability to maintain, seek, claim, or assert a title IX 
religious exception under title IX if it meets the applicable 
criteria.\33\ And to the extent the recipient is entitled to a 
religious exception under title IX, OCR's analysis will consider the 
entire statute, including title IX's specific limitation to the context 
of educational programs and activities.
---------------------------------------------------------------------------

    \33\ 20 U.S.C. 1681(a)(3); 45 CFR 86.12.
---------------------------------------------------------------------------

    Comment: Many commenters supported OCR's proposal not to import the 
title IX religious exception, highlighting what they characterized as 
the dangers of doing so in the context of health care and the potential 
consequences on people's access to health care it might have. For 
example, many commenters expressed concerns that providers would be 
able to deny essential health care services based on disapproval of a 
particular group, thereby putting at risk the health and well-being of 
already vulnerable individuals. Many commenters asserted that entities 
have invoked religious beliefs to deny individuals access to health 
care and coverage for a broad range of health care services. Commenters 
said that in urgent or emergency care situations, individuals may be 
unable to identify or use the services of an alternate provider when an 
institution withholds care based on religious tenets, even when the

[[Page 37533]]

individual is aware of such objections by an institution.
    Many commenters highlighted the difference between education and 
health care. Multiple commenters stated that unlike certain health care 
settings, many parents have the choice to send their children to 
religious schools, whereas individuals often lack meaningful choices 
when seeking a health care provider, particularly for time-sensitive 
care. For example, numerous commenters stated that choice is especially 
limited in rural areas, and some patients may only have local access to 
religiously affiliated providers. Commenters worried that importing the 
title IX religious exception into this rule could have dire 
implications for health outcomes.
    Response: As previously noted, this rule's application to the 
health care context is central to OCR's interpretation of section 1557. 
OCR appreciates that religiously affiliated hospitals and health care 
facilities play an important role in the health care system and 
recognizes the critical patient care needs they provide, including in 
underserved communities and areas which otherwise lack access to 
quality health care. At the same time, OCR believes that Congress chose 
not to import the title IX religious exception into section 1557 due to 
concerns about the impact such an action could have on access to health 
care. The importation of the title IX religious exception would raise 
unique concerns in the health care context that are not typically 
present in education programs and activities. As OCR discussed in the 
2022 NPRM, health care settings differ from educational settings with 
respect to both the ability of affected parties to choose (or avoid) 
certain religiously affiliated health care institutions and the urgency 
of the need for services provided by the covered entities. 87 FR 47840. 
While students and families normally make a deliberate choice to attend 
a religious educational institution, in many cases specifically due to 
its religious character, individuals seeking health care are far more 
likely to be driven by other considerations such as availability, 
urgency, geography, insurance coverage, and other factors unrelated to 
whether the provider is controlled by or affiliated with a religious 
organization. See id. Rather than importing the title IX religious 
exception into section 1557, where Congress referenced only the 
``ground prohibited under'' and the ``enforcement mechanisms provided'' 
for in title IX, the process set forth in Sec.  92.302 respects 
religious freedom and conscience protections. As this final rule makes 
clear at Sec.  92.3(c), insofar as the application of any requirement 
under this rule would violate applicable Federal protections for 
religious freedom and conscience, such application shall not be 
required. Under Sec.  92.302, recipients may rely on these protections 
or seek assurance of these protections from OCR, if they wish. In this 
process, OCR will comply with the applicable legal standards of the 
governing statutes, which include the protections in the ACA itself, 42 
U.S.C. 18023; the Church, 42 U.S.C. 300a-7, Coats-Snowe, 42 U.S.C. 
238n, and Weldon Amendments, e.g., Consolidated Appropriations Act, 
2024, Public Law 118-47, div. H, tit. V, sec. 507(d)(1), 138 Stat. 460, 
703 (Mar. 23, 2024); the generally applicable requirements of RFRA, 42 
U.S.C. 2000bb-1; and other applicable Federal laws.
    Comment: Many commenters who supported OCR's proposal not to import 
the title IX religious exception raised concerns that its importation 
could discourage individuals from seeking necessary medical care. Many 
commenters also discussed various State laws recently enacted to 
further expand religious exemptions from health care requirements and 
how such laws have specifically affected communities with limited 
access to care. These commenters argued that the effects of these laws 
further support OCR's goal of ensuring patients have broad access to 
nondiscrimination protections.
    Response: OCR appreciates commenters' concerns regarding the 
potential harms to individuals with limited or restricted access to 
health care. OCR appreciates that many religiously affiliated hospitals 
and providers are providing vital services in areas where people are in 
the most need and are often motivated by their faith to provide this 
important care. However, OCR maintains that Congress did not choose to 
import the title IX religious exception into section 1557. Importing 
the title IX exception would be inconsistent with the text, structure, 
and purpose of both title IX and section 1557. Rather, Congress has 
enacted protections for conscience in the ACA itself; the Church, 
Coats-Snowe, and Weldon Amendments, among others; the generally 
applicable requirements of RFRA, and other applicable Federal laws as 
the means to protect religious freedom and conscience in this context. 
We are committed to affording full effect to Congress's protections of 
conscience and religion, as detailed in Sec.  92.302 and the 
Department's issuance of its final rule, Safeguarding the Rights of 
Conscience as Protected by Federal Statutes. 89 FR 2078.
    Comment: Multiple commenters opposed OCR's proposal not to import 
the title IX religious exception, stating that doing so would harm 
providers and hospital systems by compelling covered entities to 
provide abortion or other care that is contrary to their religious 
beliefs or that they believe will be harmful to their patients. Various 
commenters said that compelling such actions would turn many 
individuals and institutions of faith away from the medical profession.
    Several commenters expressed confusion about available religious 
exceptions and how certain rule requirements would apply to religiously 
affiliated covered entities. These commenters said that including the 
title IX religious exception would clarify protections for religious 
entities.
    Some commenters expressed concern that this regulation demonstrated 
OCR's intent to use section 1557 to force religious hospitals to 
dispense medication and perform procedures that are prohibited by their 
faith. Several commenters objected to the inclusion of cites in the 
2022 NPRM that explain the increased prevalence of religiously 
affiliated health care systems and opined that this demonstrated 
hostility toward faith-based providers. According to these commenters, 
including these cites prejudices OCR's review of providers' religious 
exemption requests. Instead, these commenters urged OCR to make clear 
that providers will not be compelled to perform, cover, or promote 
procedures or medical interventions to which they have moral or 
religious objections.
    Response: OCR appreciates commenters' concerns and respects their 
opposition to the proposal not to import the title IX religious 
exception. OCR reiterates, consistent with the 2022 NPRM, that this 
final rule does not promote any particular medical treatment, require 
provision of particular procedures, mandate coverage of any particular 
care, or set any standard of care; rather, the final rule implements 
the nondiscrimination requirements of section 1557. See 87 FR 47867-68. 
The full protections of all Federal religious freedom and conscience 
laws continue to apply.
    Additionally, OCR makes clear that the decision not to import the 
title IX religious exception does not compel any individual provider or 
covered entity with religious or conscience-based objections to provide 
abortion or any other care to the extent doing so would conflict with a 
sincerely-held belief. The ACA itself provides that ``[n]othing in this 
Act shall be construed to have any

[[Page 37534]]

effect on Federal laws regarding--(i) conscience protection; (ii) 
willingness or refusal to provide abortion; and (iii) discrimination on 
the basis of the willingness or refusal to provide, pay for, cover, or 
refer for abortion or to provide or participate in training to provide 
abortion.'' 42 U.S.C. 18023(c)(2)(A). As discussed further below, 
section 1557 prohibits discrimination on the basis of race, color, 
national origin, sex, age, or disability in covered health programs or 
activities. A covered entity does not engage in discrimination 
prohibited by section 1557 if it declines to provide abortions based on 
religious or conscience objections to performing the procedure. In 
addition, any recipient that believes that it is exempt from certain 
provisions of this rule due to the application of a Federal conscience 
or religious freedom law may rely on those provisions, as referenced in 
Sec.  92.3(c), or choose to seek assurance of the applications of those 
provisions pursuant to the process provided in Sec.  92.302.
    In light of Sec.  92.302 and 42 U.S.C. 18023(c)(2)(A) (section 1303 
of the ACA), OCR maintains that although some recipient providers and 
hospitals may decline to participate in federally funded health 
programs as a result of this rule, most will choose to continue to 
participate. To avoid confusion, we have further clarified the process 
for seeking assurance of an exemption based on religious freedom and 
conscience laws at Sec.  92.302 and are committed to making available 
trainings and other resources to assist covered entities in 
understanding their obligations under section 1557 and the process by 
which they may seek assurance of an exemption under Sec.  92.302.
    Again, OCR appreciates that religiously affiliated hospitals and 
health care facilities play an important role in the health care system 
and recognizes the critical patient care needs they provide, including 
in underserved communities and areas which otherwise lack access to 
quality health care. Any discussion relating to the prevalence of 
religiously affiliated care is relevant for OCR to evaluate access 
issues that patients seeking certain procedures or care could 
potentially face, although OCR does not assume that all religiously 
affiliated entities' refusals to provide certain forms of care would 
result in such access issues. As previously stated, the 2022 NPRM 
provided factual findings with respect to health care accessibility in 
the United States based upon health care capacity of providers, 
population demands, and geographic limitations. 87 FR 47840. A detailed 
discussion of these considerations can be found in the Regulatory 
Impact Analysis (RIA).
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, OCR is finalizing the rule as proposed, without 
importing the title IX religious exception.
Relationship to Other Laws (Sec.  92.3)
    In Sec.  92.3, we provided an explanation of the relationship of 
the proposed regulation to existing laws. Proposed Sec.  92.3(a) 
provided that neither section 1557 nor this part shall be interpreted 
to apply lesser standards for the protection of individuals from 
discrimination than the standards under title VI, title IX, section 
504, the Age Act, or the regulations issued pursuant to those laws.
    In Sec.  92.3(b), we proposed that nothing in this part shall be 
interpreted to invalidate or limit the existing rights, remedies, 
procedures, or legal standards available under the Federal civil rights 
laws cited in 42 U.S.C. 18116(b) (title VI, title VII, title IX, 
section 504, and the Age Act), consistent with 42 U.S.C. 18116(b).
    In Sec.  92.3(c), we proposed that nothing in this part shall be 
interpreted to invalidate or limit the existing rights, remedies, 
procedures, or legal standards available under Federal religious 
freedom and conscience laws. Though not specifically referenced in the 
Proposed Rule, these include the protections in the ACA itself; the 
Church, Coats-Snowe, and Weldon Amendments; the generally applicable 
requirements of RFRA; and other applicable Federal laws.
    The comments and our responses to this provision are set forth 
below.
    Comment: Commenters expressed a mix of viewpoints regarding the 
``lesser standard'' language included in proposed Sec.  92.3(a), 
concerning civil rights statutes referenced in section 1557. Some 
commenters recommended removing the ``lesser standard'' language 
because it is not included in the section 1557 statute. Commenters 
stated that this language ignores Congress's decision to employ a 
particular standard to each of the civil rights laws incorporated, such 
that it would allow OCR to redefine bases for discrimination and 
improperly preempt State law affecting such categories.
    Response: In this final rule, OCR seeks to give all laws their 
fullest possible effect. OCR appreciates these comments but declines to 
remove the ``lesser standard'' language included in Sec.  92.3(a). As 
the 2016 Rule recognized, 81 FR 31381, this interpretation is 
consistent with a natural reading of section 1557's statutory text that 
explicitly states that section 1557 shall not be construed to 
``invalidate or limit the rights, remedies, procedures, or legal 
standards'' of the referenced statutes (and title VII) ``or to 
supersede State laws that provide additional protections against 
discrimination,'' 42 U.S.C. 18116(b). OCR accordingly reaffirms that 
the civil rights laws referenced in section 1557 establish the grounds 
of prohibited discrimination, and nothing in this final rule is 
intended to provide lesser protections than those found under title VI, 
title IX, section 504, or the Age Act, or their implementing 
regulations.
    Comment: Several commenters supported the inclusion of the ``lesser 
standard'' language in Sec.  92.3(a) but suggested that Sec.  92.3(c), 
concerning Federal religious freedom and conscience laws, is 
unnecessary and, if included without any limitations, undermines this 
``lesser standard'' language of Sec.  92.3(a) and could encourage 
discrimination.
    Response: We decline to remove Sec.  92.3(c), concerning Federal 
religious freedom and conscience laws. These laws remain applicable and 
removing the language runs contrary to the Department and OCR's stated 
commitment to protect the rights of individuals and entities under 
Federal conscience or religion freedom laws. Indeed, the ACA itself 
contains a similar provision at 42 U.S.C. 18023(c)(2)(A)(i), which 
provides that ``[n]othing in this Act shall be construed to have any 
effect on Federal laws regarding--conscience protection[.]'' As 
discussed later in this section, we have revised Sec.  92.3(c) to 
provide additional specificity regarding the application of Federal 
religious freedom and conscience protections.
    Comment: Some commenters suggested that OCR clarify that section 
1557 does not limit the rights of individuals to any of the protections 
afforded under title VI, title IX, section 504, or the Age Act. These 
commenters suggested that section 1557 is a distinct law and, while it 
is intended to work in tandem with other civil rights laws, section 
1557 stands on its own. Several other commenters requested that the 
final rule include language that clarifies that administrative 
exhaustion is not required to bring any claim under section 1557 in 
Federal court, where for example a claim may involve age as one basis 
of discrimination among several (e.g., alleging discrimination on the 
bases of age, sex, and disability at the same time) but the Age Act has 
a

[[Page 37535]]

statutory requirement that claimants first exhaust their administrative 
remedies.
    Response: Section 92.3(b) clearly states that this part does not 
limit or invalidate the rights, remedies, procedures, or legal 
standards under the statutes referenced (i.e., title VI, title VII, 
title IX, section 504, and the Age Act), consistent with the statutory 
text of section 1557 at 42 U.S.C. 18116(b). In addition to 
incorporating the ``ground[s] prohibited'' by these other statutes, 
section 1557 incorporates the ``enforcement mechanisms'' of the 
statutes. 42 U.S.C. 18116(a). Though the section 1557 rule is informed 
by the title VI, title IX, Age Act, and section 504 implementing 
regulations, section 1557 provides an independent basis for regulation 
of discrimination in covered health programs and activities that is 
distinct from these statutes. Section 1557's nondiscrimination 
requirements do not in any way limit or impact the interpretation of 
those statutes. See id. at 18116(b). Section 1557 is a distinct civil 
rights authority.
    Courts have long recognized that section 1557 authorizes a private 
right of action under any of the bases for discrimination. While we 
appreciate concerns raised by commenters regarding the heightened risks 
associated with unnecessary delays in the context of health care, we 
decline to revise regulatory text to adopt a stance on the appropriate 
standards that apply to private litigants. This is an issue 
appropriately addressed by the Federal judicial branch and not via 
agency rulemaking. Comments and responses regarding OCR procedures for 
conducting its own administrative enforcement are provided in 
Sec. Sec.  92.303 (Procedures for health programs and activities 
conducted by recipients and State Exchanges) and 92.304 (Procedures for 
health programs and activities administered by the Department).
    Comment: Many commenters raised concerns about the potential 
conflicts of State and Federal laws. Some commenters expressed that any 
conflict between State and Federal law or policy would be inconsistent 
with the principles of federalism. Some commenters had specific 
concerns regarding the final rule's application to State laws that 
prohibit transgender patients from receiving certain medically 
necessary gender-affirming care or those that protect religious freedom 
and conscience. Other commenters suggested that OCR should include a 
subsection in the final rule that addresses the interaction between 
section 1557 and State or local laws, making explicit that a State may 
set more rigorous standards for nondiscrimination in the provision of 
health care but not lesser protections than those of section 1557. To 
the extent State or local law offers lesser protections these 
commenters recommended OCR make explicit that such laws are preempted 
by Federal law, consistent with the general preemption standard for 
title I of the ACA, codified at 42 U.S.C. 18041(d).
    Response: OCR appreciates these comments regarding the rule's 
interaction with State and other Federal laws. We agree with commenters 
who observed that Federal laws, as a general matter, preempt 
conflicting State laws. See U.S. Const. art. 6, cl. 2. We also note 
that title I of the ACA itself contains a preemption provision, which 
courts have interpreted to preempt State laws that serve as an obstacle 
to or frustrate the purpose of the ACA.\34\ See 42 U.S.C. 18041(d). 
Accordingly, we decline to alter the regulation to include any 
additional language under this provision addressing preemption. OCR 
recognizes that some States may have laws impacting health programs and 
activities that are contrary to the final rule's nondiscrimination 
protections, and as discussed later regarding Sec.  92.206 (Equal 
program access on the basis of sex), section 1557 preempts those laws, 
though OCR will consider the specific facts of each case and any other 
relevant factors in determining whether the recipient has a legitimate, 
nondiscriminatory reason for taking actions that conflict with section 
1557. OCR is adding Sec.  92.3(d) regarding State and local laws to 
provide: ``Nothing in this part shall be construed to supersede State 
or local laws that provide additional protections against 
discrimination on any basis described in Sec.  92.1.''
---------------------------------------------------------------------------

    \34\ See St. Louis Effort for AIDS v. Huff, 782 F.3d 1016, 1021, 
1024 (8th Cir. 2015) (partially affirming lower court preliminary 
injunction because Missouri law ``frustrates Congress' purpose'' and 
``pose[s] an obstacle to the accomplishment and execution of the 
full purposes and objectives of Congress''); Coons v. Lew, 762 F.3d 
891 (9th Cir. 2014), as amended, (Sept. 2, 2014) (``The Affordable 
Care Act presents a classic case of preemption by implication 
because the Arizona Act `stands as an obstacle to the accomplishment 
and execution of the full purposes and objectives of Congress.' ''), 
quoting Gade v. Nat'l Solid Wastes Mgmt. Ass'n, 505 U.S. 88, 98 
(1992).
---------------------------------------------------------------------------

    Comment: Commenters recommended that OCR include in the final rule 
clarification that the Emergency Medical Treatment and Labor Act 
(EMTALA) protects emergency care for pregnancy and related conditions, 
including termination of pregnancy.
    Response: This rule concerns section 1557 and does not purport to 
interpret or enforce EMTALA--indeed, OCR does not enforce EMTALA, nor 
does EMTALA limit or expand the civil rights protections found in 
section 1557.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.3, with modifications. We are revising Sec.  92.3(c) to 
provide that, insofar as the application of any requirement under the 
part would violate applicable Federal protections for religious freedom 
and conscience, such application shall not be required. For example, 42 
U.S.C. 18023 provides (among other things) that, nothing in section 
1557 shall be construed to have any effect on Federal laws regarding 
conscience protection; willingness or refusal to provide abortion; and 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion. We are also adding a new Sec.  92.3(d) to 
provide that nothing in the part shall be construed to supersede State 
or local laws that provide additional protections against 
discrimination on any basis described in Sec.  92.1.
Definitions (Sec.  92.4)
    In Sec.  92.4 of the Proposed Rule, we set out proposed definitions 
of various terms. The comments and our responses regarding Sec.  92.4 
are set forth below.
    Auxiliary aids and services. The term auxiliary aids and services 
was defined in the 2016 Rule and has not been changed substantively. 
The proposed definition is consistent with the Americans with 
Disabilities Act (ADA) regulations at 28 CFR 35.104 and 36.303(b) and 
provides examples of auxiliary aids and services.
    Comment: Commenters generally supported the definition of 
``auxiliary aids and services.'' Some commenters recommended that the 
final rule clarify that ``similar services and actions'' are available 
for all individuals with disabilities, not just for individuals who are 
deaf or hard of hearing and individuals who are blind or have low 
vision.
    Response: OCR appreciates this comment; however, effective 
communication requirements are addressed in Sec.  92.202(a). As Sec.  
92.4 is simply providing a definition for the term auxiliary aids and 
services, which is used in Sec.  92.202(b), we do not believe

[[Page 37536]]

it is appropriate to adopt language suggested by the commenters.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``auxiliary aids 
and services'' as proposed in Sec.  92.4, with one technical correction 
in paragraph (1) to provide the correct cite for the title II 
definition of ``qualified interpreter'' by striking ``36.303(b)'' and 
replacing it with ``36.104.''
    Companion. We proposed to define the ``companion'' to mean ``family 
member, friend, or associate of an individual seeking access to a 
service, program, or activity of a covered entity, who along with such 
individual, is an appropriate person with whom a covered entity should 
communicate.'' This term appeared in the 2016 Rule and has not been 
changed substantively.
    Comment: Many commenters support the inclusion of the term 
``companion'' in the definitions section of the regulation, and some 
highlighted that companions for persons with certain disabilities, such 
as brain injuries and other conditions with cognitive effects, as well 
as individuals with sensory disabilities, are critical to effective 
communication of very sensitive and important medical information. Some 
commenters suggested that OCR clarify that such companions should be 
selected by the patient and not the provider.
    Response: OCR appreciates the commenters' support for inclusion of 
this definition. OCR declines to add additional language, as the 
definition of ``companion'' in this rule is consistent with the 
definition from 28 CFR 35.160(a)(2) under title II of the ADA, and with 
the proposed definition in OCR's notice of proposed rulemaking for 
section 504 at proposed 45 CFR 84.10.\35\ We agree that the individual 
with a disability should be the one to determine who shall serve as 
their companion absent any concerns of conflict of interest or 
suspected abuse.
---------------------------------------------------------------------------

    \35\ See 88 FR 63392, 63465 (Sept. 14, 2023) (proposing to 
define ``companion'' consistent with ADA title II regulations).
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``companion'' as 
proposed in Sec.  92.4, without modification.
    Federal financial assistance. We proposed to define the term 
``Federal financial assistance'' to include grants, loans, and other 
types of assistance from the Federal Government, consistent with the 
definition of the term in the section 504 and the Age Act implementing 
regulations at 45 CFR 84.3(h) and 91.4, respectively. We also proposed 
to specifically include credits, subsidies, and contracts of insurance, 
in accordance with the statutory language of section 1557. 42 U.S.C. 
18116(a). Consistent with the 2016 Rule, we proposed including a clause 
to clarify that Federal financial assistance includes Federal financial 
assistance that the Department plays a role in providing or 
administering.
    Comment: Many commenters supported the inclusion of credits, 
subsidies, contracts of insurance, and grants and loans in this 
definition. Some commenters recommended expanding the definition of 
``Federal financial assistance'' to include Federal disaster relief 
loans and pandemic relief grants and loans.
    Response: The definition of ``Federal financial assistance'' 
includes funds provided by the Federal Government, including grants and 
loans, along with Federal financial assistance that the Department 
plays a role in providing or administering. Because the types of funds 
raised by the commenters already fall under the longstanding definition 
of ``Federal financial assistance,'' and the inclusion of specific 
types of Federal financial assistance would cause unnecessary confusion 
and may be read as unintentionally limiting the scope of what 
constitutes Federal financial assistance, we decline to revise the 
definition.
    Comment: Some commenters requested that OCR clarify whether tax-
exempt status is considered Federal financial assistance.
    Response: OCR appreciates commenters' request for clarity. 
Generally, tax benefits, tax exemptions, tax deductions, and most tax 
credits are not included in the statutory or regulatory definitions of 
Federal financial assistance. See, e.g., 42 U.S.C. 2000d-1 (title VI); 
28 CFR. 42.102(c) (Department of Justice Title VI Regulation). Most 
courts that have considered the issue have concluded that typical tax 
benefits are not Federal financial assistance because they are not 
contractual in nature.\36\
---------------------------------------------------------------------------

    \36\ See, e.g., Paralyzed Veterans of Am. v. Civil Aeronautics 
Bd., 752 F.2d 694, 708-09 (D.C. Cir. 1985); Johnny's Icehouse, Inca 
v. Amateur Hockey Ass'n of Ill., Inc., 134 F. Supp. 2d 965, 971-
7297172 (N.D. Ill. 2001); Chaplin v. Consol. Edison Co., 628 F. 
Supp. 143, 145-46 (S.D.N.Y. 1986).
---------------------------------------------------------------------------

    Comment: Many commenters supported the definition's inclusion of 
Federal financial assistance that ``the Department plays a role in 
providing or administering, including advance payments of the premium 
tax credit and cost-sharing reduction payments.'' \37\ A commenter 
expressed support for this definition's application to funds extended 
via programs operated by States under section 1332 State Innovation 
Waivers, 42 U.S.C. 18052, which could include funds extended to issuers 
receiving reimbursement through reinsurance programs and entities 
participating in programs intended to modify or replace Exchanges that 
would otherwise be within the scope of section 1557.
---------------------------------------------------------------------------

    \37\ See section 1412 of the ACA, codified at 42 U.S.C. 18082 
(Advance determination and payment of premium tax credits and cost-
sharing reductions).
---------------------------------------------------------------------------

    Response: OCR appreciates these comments and believes it is 
important to explicitly state in regulatory text that funds that the 
Department plays a role in providing or administering constitute 
Federal financial assistance. As explained in the Proposed Rule, 87 FR 
47843, this includes funds the Department administers with the 
Department of the Treasury under the ACA, including advance payments of 
the premium tax credit, cost-sharing reductions,\38\ and pass-through 
funding available to States with approved section 1332 waivers. Thus, 
an issuer participating in any Exchange that receives advance payments 
of the premium tax credit or cost-sharing reductions on behalf of any 
of its enrollees is receiving Federal financial assistance from the 
Department.
---------------------------------------------------------------------------

    \38\ The Department is not currently making cost-sharing 
reduction payments to issuers. See Memo. from Eric Hargan, Acting 
Sec'y, U.S. Dep't of Health & Hum. Servs., to Seema Verma, Admin'r, 
Ctrs. for Medicare & Medicaid Servs. (enclosing Attorney General 
Jeff Sessions' legal opinion, dated October 11, 2017, regarding 
cost-sharing reduction payments) (Oct. 12, 2017), https://www.hhs.gov/sites/default/files/csr-payment-memo.pdf. If the 
Department begins making cost-sharing reduction payments in the 
future, such payments would be considered Federal financial 
assistance.
---------------------------------------------------------------------------

    Section 1332 of the ACA permits a State to apply for a section 1332 
waiver to pursue innovative strategies for providing residents with 
access to high quality, affordable health insurance while retaining the 
basic protections of the ACA. Section 1332 waiver funds constitute 
Federal financial assistance and States receiving such funds are 
recipients. As discussed in the 2022 NPRM, section 1332 allows States 
to apply to HHS and the Department of the Treasury to waive certain ACA 
requirements in the individual and small group markets if the waiver 
satisfies certain statutory

[[Page 37537]]

requirements.\39\ 87 FR 47843. For example, under this provision, 
several States have utilized section 1332 waivers to introduce new or 
expanded plan options to consumers that lower premiums and/or expand 
access to coverage, or implemented reinsurance programs to lower 
premiums and stabilize the individual or small group market by 
compensating issuers for eligible high-cost claims for enrollees with 
significant medical costs. These State reinsurance programs use section 
1332 pass-through funding to reimburse eligible issuers for high-cost 
enrollees. These States establish reimbursement eligibility criteria 
for issuers under the State's reinsurance program, which may include 
payments to issuers offering coverage both on and off the Exchange. 
Health insurance issuers receiving payments through a State's section 
1332 waiver reinsurance program are subrecipients and therefore subject 
to section 1557. To the extent a State's waiver utilizes pass-through 
funding for provider reimbursement those providers would also be 
subrecipients and subject to section 1557; however pass-through funding 
received by individual consumers would not be subject to section 1557.
---------------------------------------------------------------------------

    \39\ Sections 1332(a)-(b) of the ACA, codified at 42 U.S.C. 
18052(a)-(b). States with approved waivers have specific terms and 
conditions (STCs) pursuant to which the state must also comply with 
all applicable Federal statutes relating to nondiscrimination, 
including section 1557. See, e.g., Ctrs. for Medicare & Medicaid 
Servs., approval of New Jersey's extension application for a section 
1332 State Innovation Waiver, STC 4 (Aug. 15, 2023), https://www.cms.gov/files/document/1332-nj-extension-approval-letter-stcs-final.pdf.
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``Federal 
financial assistance'' as proposed in Sec.  92.4, without modification.
    Health program or activity. OCR proposed to adopt a definition of 
``health program or activity.'' In paragraph (1), we proposed defining 
health program or activity to mean any project, enterprise, venture, or 
undertaking to provide or administer health-related services, health 
insurance coverage, or other health-related coverage; provide 
assistance to persons in obtaining health-related services, health 
insurance coverage, or other health-related coverage; provide clinical, 
pharmaceutical, or medical care; engage in health research; or provide 
health education for health care professionals or others.
    In paragraph (2), we proposed further defining ``health program or 
activity'' to include all of the operations of any entity principally 
engaged in the provision or administration of health projects, 
enterprises, ventures, or undertakings described in paragraph (1) 
(``principally engaged''). We proposed that whether such entities are 
administered by a government or a private entity, all of their 
operations would be covered under this part.\40\ We also invited 
comment on the circumstances under which a group health plan might 
receive funds that could be considered Federal financial assistance 
from the Department, including the type and prevalence of funds 
received that could be considered Federal financial assistance under 
this part.
---------------------------------------------------------------------------

    \40\ See, e.g., Fain v. Crouch, 545 F. Supp. 3d 338, 343 (S.D.W. 
Va. 2021), rehearing en banc granted, No. 22-1927 (4th Cir. Apr. 12, 
2023) (oral argument held Sept. 21, 2023) (argued with Kadel v. 
Folwell, No. 22-1721) (holding that defendant health plan was, ``by 
virtue of its acceptance of Federal assistance under its Medicare 
Advantage program,'' required to comply with section 1557 ``under 
its entire portfolio'').
---------------------------------------------------------------------------

    Comment: Commenters expressed a variety of views regarding the 
application of the rule to health insurance issuers as health programs 
or activities and the rule's application to all their operations when 
principally engaged in any project, enterprise, venture, or undertaking 
to provide or administer health-related services, health insurance 
coverage, or other health-related coverage, as set forth under 
paragraph (2) of the definition of ``health program or activity.''
    Many commenters supported the inclusion of health insurance issuers 
and coverage of all their operations when so principally engaged. These 
commenters argued the 2020 Rule's approach, which applies to health 
insurance issuers only to the extent a specific plan receives Federal 
financial assistance, is contrary to the text of section 1557, the 
CRRA, and the broad remedial intent of Congress in enacting the ACA to 
ensure access to health insurance. Specifically, commenters argued the 
2020 Rule is arbitrary and contrary to the plain language of section 
1557, which applies to ``any health program or activity, any part of 
which is receiving Federal financial assistance'' (emphasis added) and 
specifically includes three examples of Federal financial assistance 
that refer to health insurance (``credits, subsidies, or contracts of 
insurance''). 42 U.S.C. 18116(a). This statutory language, commenters 
argued, affirms that Congress intended section 1557 to apply to the 
entire health program or activity, not just the parts that directly 
receive Federal financial assistance. Commenters noted that the 
statutory text should be construed broadly and stated that the Proposed 
Rule's application to health insurance will align with the application 
to all operations of other covered entities.
    Many commenters raised objections to the 2020 Rule's provision at 
Sec.  92.3(b) that covers all operations of an entity only when 
principally engaged ``in the business of providing healthcare'' 
(emphasis added), in combination with Sec.  92.3(c) that specified a 
health insurance issuer was not considered to be principally engaged in 
the business of providing health care merely by virtue of providing 
health insurance, which resulted in the 2020 Rule not covering all 
operations of a recipient health insurance issuer. Commenters stated 
this approach was inconsistent with Congress's approach in the CRRA, 
which supports an expansive interpretation of section 1557's 
application to cover all operations of a recipient if any part of it 
receives Federal financial assistance. Specifically, one commenter 
asserted that the section 1557 statute's use of the CRRA language 
``program or activity'' and ``any part of which,'' coupled with the 
statute's reference to title VI, title IX, section 504, and the Age 
Act, demonstrate Congress's intent to adopt the same broad application 
for section 1557. Commenters also argued the 2020 Rule's approach is 
inconsistent with the text of section 1557, which broadly applies to 
health programs or activities and is not limited to the delivery of 
health care. Commenters challenged the 2020 Rule's contention that 
health insurance is not health care, arguing that health insurance 
issuers are in fact engaged in the business of health care and that 
other parts of the ACA support this position. For example, ``health 
care entity'' is defined to include ``a health insurance plan'' under 
42 U.S.C. 18113(b) and 42 U.S.C. 300gg-91(b)(1) defines ``health 
insurance coverage'' to mean benefits consisting of medical care.'' 
Among other things, commenters cited to section 1551 of the ACA, 42 
U.S.C. 18111, which specifies that, unless otherwise indicated, the 
definitions in 42 U.S.C. 300gg-91 apply to title I of the ACA.
    Conversely, other commenters urged the Department to retain the 
2020 Rule's approach, asserting that the CRRA limits the scope of 
section 1557 with regard to all operations of a program or activity to 
only those that are ``principally engaged in the business of providing 
. . . healthcare'' (emphasis added).
    Others argued that the Proposed Rule's application to health 
insurance is

[[Page 37538]]

too broad and should not apply to all operations of a health insurance 
issuer, particularly its lines of business that do not receive Federal 
financial assistance. Specifically, commenters noted that because 
health insurance issuers participate in some types of health insurance 
that receive Federal financial assistance and other types that do not, 
the Proposed Rule would require compliance even in activities that do 
not benefit from Federal financial assistance. Commenters opined that 
this interpretation goes beyond the scope of Congressional intent, 
where Congress did not apply the protections to any entity engaging in 
health programs and activities, but only to those health programs and 
activities that specifically receive Federal financial assistance. One 
organization asserted that the Proposed Rule could result in health 
insurance issuers incurring substantial costs and declining to 
participate in or withdrawing from the Exchanges, the Medicaid managed 
care market, or the Medicare Advantage market, resulting in reduced 
coverage options in those markets.
    Response: In re-evaluating the 2020 Rule's interpretation of 
``health program or activity'' as it relates to health insurance and in 
deciding to add a definition of ``health program or activity,'' OCR 
considered a number of factors, including the plain language of section 
1557, the context of its placement within the ACA, long-standing civil 
rights principles, and relevant case law.
    The 2020 Rule does not include a definition of ``health program or 
activity,'' but rather addresses the term under Sec.  92.3, the scope 
of application section. The 2020 Rule provides that ``health program or 
activity'' encompasses ``all of the operations of entities principally 
engaged in the business of providing healthcare'' (emphasis added) and 
specifies that a health insurance issuer is not considered to be 
principally engaged in the business of providing health care merely by 
virtue of providing health insurance. 45 CFR 92.3. The 2020 Rule 
further provides that for entities not principally engaged in the 
business of providing health care, their operations are only covered 
under the rule to the extent such operation is a health program or 
activity that receives Federal financial assistance. 45 CFR 92.3(b). 
Thus, the 2020 Rule limits OCR's jurisdiction over health insurance 
issuers to only their plans that directly receive Federal financial 
assistance. This is in contrast to the 2016 Rule, which defined 
``health program or activity'' to include all the operations of 
entities principally engaged in health services, health insurance 
coverage, or other health-related coverage, including health insurance 
issuers, at former 45 CFR 92.4.
    OCR agrees with commenters' assessment that the Proposed Rule's 
approach to the inclusion of health insurance coverage and other 
health-related coverage in the definition of ``health program or 
activity'' is most consistent with section 1557's statutory text and 
Congressional intent. The statutory text demonstrates Congress's clear 
intent to apply section 1557 to health insurance coverage and other 
health-related coverage. This statutory text does not support the 2020 
Rule's limiting ``health program or activity'' to encompass all of the 
operations of only those entities principally engaged in the business 
of providing ``healthcare.'' Under the plain language of the statute, 
section 1557 applies to any ``health'' program or activity not 
``healthcare'' program or activity. And the provision of health 
insurance coverage and other health-related coverage is plainly 
classified under the term ``health.'' Private health insurance issuers 
exercise significant control over enrollees' access to health care and 
play a critical role in the business of health care, as insurance is an 
essential component of ensuring that people receive care in the current 
health care system. For example, a district court opinion on this issue 
held that a health insurance issuer, by virtue of being the 
``gatekeeper'' to the plaintiff's health services, qualified as a `` 
`health program' that Congress intended to rid of discrimination.'' 
\41\
---------------------------------------------------------------------------

    \41\ Fain v. Crouch, 545 F. Supp. 3d 338, 342-43 (S.D.W. Va. 
2021) (finding `` `health program or activity' under Section 1557 
necessarily includes health insurance issuers'' and holding that 
defendant health plan was, ``by virtue of its acceptance of federal 
assistance under its Medicare Advantage program,'' required to 
comply with section 1557 ``under its entire portfolio''), rehearing 
en banc granted, No. 22-1927 (4th Cir. Apr. 12, 2023) (oral argument 
held Sept. 21, 2023) (argued with Kadel v. Folwell, No. 22-1721).
---------------------------------------------------------------------------

    Further, as we discussed in the Proposed Rule, 87 FR 47845, the 
fact that Congress placed section 1557 in title I of the ACA, a title 
that predominantly regulates health insurance coverage and other 
health-related coverage with the purpose of increasing access to care 
and reducing discriminatory insurance practices, demonstrates 
Congress's intent for section 1557 to protect individuals from 
discrimination in health insurance coverage and other health-related 
coverage.
    While not dispositive, we do appreciate commenters' thoughts on 
whether health insurance issuers are in fact engaged in the business of 
providing health care. Commenters among other things, cited to section 
1551 of the ACA, which specifies that, unless otherwise indicated, the 
definitions in 42 U.S.C. 300gg-91 shall apply with respect to title I 
of the ACA. Section 300gg-91(b)(1) defines the term ``health insurance 
coverage'' as ``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.) The 
2020 Rule specifies that ``medical care'' as used in that provision is 
limited to the ``amounts paid for'' certain medical services and that a 
health insurance issuer is not considered to be principally engaged in 
the business of providing health care merely by virtue of providing 
health insurance. However, the text of section 1557 does not support 
the 2020 Rule's position that the rule applies only to the business of 
providing ``healthcare.''
    OCR found commenters' concerns regarding the negative consequences 
that could result from the Proposed Rule's scope of application to 
insurance issuers unpersuasive given the lack of information provided 
to substantiate their concerns. For example, one commenter cited to 
Exchange participation statistics that indicated certain issuers have 
limited or no Exchange participation.\42\ However, the statistics do 
not demonstrate the reason for such issuers' lack of participation or 
provide evidence that an issuer's decision not to participate in an 
Exchange was due to apprehension that section 1557 would apply to its 
activities that did not receive Federal financial assistance.
---------------------------------------------------------------------------

    \42\ Mark Farrah Assocs., https://www.markfarrah.com (statistics 
compiled using data from the National Association of Insurance 
Commissioners, the California Department of Managed Health Care, and 
CMS).
---------------------------------------------------------------------------

    The application of civil rights laws to all operations of an entity 
receiving Federal financial assistance is not new and did not originate 
with section 1557. For more than 35 years, under the CRRA, a recipient 
of Federal financial assistance that accepts Federal funds in any part 
of its program has been required to comply with title VI, section 504, 
and the Age Act in ``all of the[ir] operations.'' \43\ The CRRA 
specifies that the entire program or activity, as defined in that 
statute, is required to comply with title VI, section 504, and the Age 
Act if any part of the program or activity receives Federal financial

[[Page 37539]]

assistance. We note that the terms ``program'' and ``program or 
activity'' predate the CRRA in the underlying civil rights statutes, 
and the legislative history of the CRRA indicates that Congress did not 
believe it was enacting a new definition, but rather overturning an 
overly narrow construction of the term by the Supreme Court and thereby 
restoring what Congress and the executive branch had previously 
understood to be a broad, institution-wide application of the term 
``program.'' See S. Rep. No. 100-64 (1987). OCR maintains that Congress 
adopted a similar approach in section 1557 by specifying in the statute 
that section 1557 applies when ``any part of'' the health program or 
activity receives Federal financial assistance.\44\ Entities must 
comply with civil rights laws just as they must comply with any other 
State or Federal law that is applicable to their operations.
---------------------------------------------------------------------------

    \43\ Public Law 100-259, 102 Stat. 29 (Mar. 1988), codified at 
20 U.S.C. 1687; 29 U.S.C. 794(b); 42 U.S.C. 2000d-4(a); 6107(4).
    \44\ Compare CRRA, 20 U.S.C. 1687(4) (``any part of which is 
extended Federal financial assistance'') with section 1557, 42 
U.S.C. 18116 (``any part of which is receiving Federal financial 
assistance'').
---------------------------------------------------------------------------

    The 2020 Rule states it was applying the CRRA's definition of 
``program or activity'' to cover all operations of entities under 
section 1557 only when they are ``principally engaged in the business 
of providing healthcare.'' We received some comments in support of the 
approach in that rulemaking, and while we appreciate the importance of 
the CRRA in shaping the interpretation of the scope of Federal civil 
rights protections under title VI, section 504, title IX, and the Age 
Act, it is not applicable here. Section 1557 employs the term ``program 
or activity'' without adopting by reference the CRRA or any of the 
underlying civil rights statutes. The 2020 Rule erred in applying the 
CRRA to narrow the application of section 1557 by excluding a 
significant portion of the health insurance industry. If Congress had 
intended to limit section 1557 to entities principally engaged in the 
business of providing ``healthcare,'' it could have provided as such in 
the statute. Instead, the statute expressly modified ``program or 
activity'' with ``health,'' without requiring that that entity be 
``principally engaged in the business of providing healthcare.''
    While Congress did not incorporate the CRRA into section 1557 
wholesale, it stated that section 1557 applies to ``any health program 
or activity, any part of which is receiving Federal financial 
assistance.'' 42 U.S.C. 18116(a) (emphasis added). By modifying 
``program or activity'' with ``health,'' and noting a health programs 
or activity is covered if ``any part'' of it receives Federal financial 
assistance, it is reasonable to infer that Congress intended the term 
``health program or activity'' to be interpreted broadly and to include 
all of that entity's operations, if the entity that receives Federal 
funding is principally engaged in the provision or administration of 
health insurance coverage or other health-related coverage. And because 
``health program and activity'' is undefined in the section 1557 
statute, it is also reasonable to infer that those health programs or 
activities include health-related services, health insurance coverage, 
or other health-related coverage.
    Comment: One commenter argued that, because the CRRA delineates the 
scope of coverage of section 1557's underlying civil rights statutes, 
failing to include this limitation in the final rule would expand the 
notion of Federal financial assistance to ultimate beneficiaries of the 
funding and would have significant effect on other civil rights laws 
dealing with funding, including title VI, title IX, and others.
    Response: The commenter's concerns regarding interference with the 
longstanding principle that Federal civil rights laws do not apply to 
direct, unconditional assistance to ultimate beneficiaries are 
unsupported. Ultimate beneficiaries are the intended class of private 
individuals receiving Federal aid,\45\ a concept that is not impacted 
or modified under this rulemaking. In fact, the definition of 
``recipient'' in the final rule at Sec.  92.4 adopts standard language 
that explicitly states that the term ``does not include any ultimate 
beneficiary.''
---------------------------------------------------------------------------

    \45\ U.S. Dep't of Justice, Title VI Legal Manual, section 
V.C.2.F.
---------------------------------------------------------------------------

    Comment: OCR received comments specifically related to the rule's 
application to health insurance issuers' other products and lines of 
business that do not receive Federal financial assistance, such as 
health insurance coverage sold off the Exchange, excepted benefits, 
short-term, limited-duration insurance, and third party administrator 
activities.
    Response: These comments are addressed in the Scope of Application 
discussion under Sec.  92.207 (Nondiscrimination in health insurance 
coverage and other health-related coverage).
    Comment: Some commenters, including an association representing 
State insurance regulators, critiqued OCR's ``fungibility of funds'' 
rationale for including all operations of recipients that are 
principally engaged in the provision or administration of health 
insurance coverage. These commenters argued it is inappropriate to 
consider funding to be fully fungible in the context of health 
insurance, where issuers justify their premiums based on expected costs 
in a particular market, not across all operations, and thus Federal 
financial assistance for one type of coverage does not actuarially 
support or subsidize an issuer's operations in other markets. 
Commenters noted that entities have a myriad of corporate structures, 
and that Federal funds received by one legal entity might not be shared 
with sibling entities in unrelated business ventures. Commenters 
pointed to the 2016 Rule's analysis regarding liability of third party 
administrators, where OCR discussed that a third party administrator 
that is legally separate from an issuer is unlikely to be covered under 
the rule. 81 FR 31433.
    Conversely, other commenters agreed with OCR's fungibility of funds 
rationale, and argued that Federal financial assistance going to any 
part of a health program or activity necessarily benefits the entity 
receiving such funds as a whole. These commenters noted that a narrower 
construction, in which nondiscrimination rules apply only to part of a 
recipient, makes it easier for discriminatory actors to structure their 
operations to evade responsibility and frustrates the purpose of the 
statute.
    Response: As commenters noted, OCR discussed the fungibility of 
funds rationale as one means of support for the interpretation that all 
of a health insurance issuer's operations will be covered by the final 
rule when the health insurance issuer receives Federal financial 
assistance. See 87 FR 47844. However, we note that reliance on this 
rationale is not necessary to support OCR's interpretation that this 
final rule applies to all of the operations of a recipient that is 
``principally engaged,'' as discussed above. Under the best reading of 
the statutory text, where an entity receives Federal financial 
assistance and that entity is ``principally engaged in the provision or 
administration of any health projects, enterprises, ventures, or 
undertakings described in paragraph (1)'' of the definition of ``health 
program or activity,'' the whole entity is defined as a health program 
or activity covered under section 1557 and must comply with the final 
rule.
    We acknowledge that covered entities may structure their businesses 
in a variety of ways. Unless an entity that is principally engaged can 
demonstrate that part of their operations is truly a separate legal 
entity, as discussed below, a recipient that is principally engaged is 
liable for all its operations under the final rule.

[[Page 37540]]

    Comment: One organization recommended that OCR explicitly identify 
patient billing and collections activities as ``health programs or 
activities'' by amending the definition to add a new paragraph (1)(vi) 
as follows: ``provide or administer billing and collections services 
for health-related services, including providing assistance to persons 
to obtain financial help or counseling.''
    Response: This final rule, consistent with OCR's other civil rights 
implementing regulations, prohibits covered entities--directly or 
through contractual or other arrangements--from discriminating in 
patient billing and collection activities related to health programs 
and activities. For example, a hospital's in-house administration of 
billing would be covered and any contractual arrangement for 
collections of debt would also be covered. We decline to add the 
recommended language because it is unnecessary.
    Comment: Many commenters strongly supported the Proposed Rule's 
explicit inclusion of health research in the definition of ``health 
program or activity.'' Some commenters recommended updating paragraph 
(1)(iv) to include ``clinical'' research for clarity and to update 
paragraph (2) to include: ``clinical trial sites including wherever 
potential clinical trial participants are screened or recruited'' in 
the list of entities considered ``principally engaged.'' In addition, 
other commenters recommended that OCR provide technical guidance in 
what ``inclusion'' in clinical research looks like and how it can be 
achieved through nondiscriminatory research protocols.
    Response: OCR supports the request to include clinical research in 
the definition of ``health program and activity,'' and have revised 
paragraph (1)(iv) accordingly. Clinical research is the comprehensive 
study of the safety and effectiveness of the most promising advances in 
patient care, and is different from laboratory research as it involves 
people who volunteer to help the field better understand medicine and 
health.\46\ However, we decline to add reference to physical sites, as 
the jurisdiction applies to the health program or activity regardless 
of where it takes place and whether it can be said to take place at a 
site at all. For example, if a hospital receives a grant from the 
National Institutes of Health to conduct a clinical study on the 
effects of Tuberous Sclerosis Complex, the hospital is prohibited from 
discriminating in its screening and recruitment activities wherever 
they take place, such as at the hospital itself, at community health 
fairs, online, or at the home of a hospital researcher who is working 
out of their own home.
---------------------------------------------------------------------------

    \46\ John Hopkins Medicine, Research, Understanding Clinical 
Trials, Clinical Research: What Is It?, https://www.hopkinsmedicine.org/research/understanding-clinical-trials/clinical-research-what-is-it.html.
---------------------------------------------------------------------------

    Comment: One organizational commenter requested that OCR clarify 
section 1557's application to health research projects and activities 
to explicitly recognize that health research is conducted to answer 
specific questions, and that research protocols may target or exclude 
certain populations where nondiscriminatory justifications show that 
such criteria are appropriate, consistent with the 2016 Rule preamble.
    Response: Consistent with the 2016 Rule, OCR does not intend the 
inclusion of health or clinical research within the definition of 
``health program or activity'' to alter the fundamental nature in which 
research projects are designed, conducted, or funded. 81 FR 31385. As 
in the 2016 Rule, we note that criteria in research protocols that 
target or exclude certain populations are warranted where 
nondiscriminatory justifications establish that such criteria are 
appropriate with respect to the health or safety of the subjects, the 
scientific study design, or the purpose of the research. See 81 FR 
31385.
    Comment: Some commenters recommended that OCR narrow the definition 
of ``health program or activity'' to exclude programs and activities 
unrelated to health. These commenters also requested that OCR clarify 
what ``any project, enterprise, venture or undertaking to provide or 
administer health-related services'' means. For example, these 
commenters were unclear whether a health-related venture may include 
such things as vitamin manufacturing.
    Response: The final rule applies to health programs and activities 
that receive Federal financial assistance from the Department (or that 
are administered by the Department or a title I entity) and does not 
apply generally to programs and activities that are unrelated to 
health. However, where an entity is principally engaged as set forth in 
paragraph (2) of the definition of ``health program or activity,'' all 
operations of the covered entity must comply with the final rule. This 
applies even where the covered entities' other operations are not 
necessarily health-related.
    Though not an exhaustive list, ``health-related service'' would 
include the provision of medical, dental, and pharmaceutical care; 
preventive health services; physical, occupational, or speech therapy; 
behavioral health care; clinical trials; and transportation to and from 
such services when necessary to facilitate access to other health-
related services.\47\ Should an entity engaged in commercial vitamin 
manufacturing receive Federal financial assistance from the Department, 
OCR would conduct an analysis as to whether the program or activity in 
question meets the definition of ``health program or activity.''
---------------------------------------------------------------------------

    \47\ See, e.g., 42 CFR 431.53 (requiring a state Medicaid plan 
to specify that the Medicaid agency will ensure ``necessary 
transportation for beneficiaries to and from providers'').
---------------------------------------------------------------------------

    Comment: A few commenters urged the Department to expressly list 
Medicaid programs, Children's Health Insurance Program (CHIP), or the 
Basic Health Program in its definition for ``health program or 
activity.''
    Response: The 2016 Rule included Medicaid programs, CHIP and the 
Basic Health Program in its definition of ``health program or 
activity'' at former 45 CFR 92.4. As stated in the preamble to the 2022 
NPRM, these entities would be covered in their entirety as operations 
of State or local health agencies and we sought comment on whether such 
programs should be explicitly referenced in the regulatory language. 87 
FR 47844. For clarity and to reduce confusion, OCR accepts the 
recommendation to include State Medicaid programs, CHIP, and the Basic 
Health Program in paragraph (2) of the definition of ``health program 
or activity.''
    Comment: Numerous commenters objected to the 2022 NPRM's proposal 
to not explicitly include group health plans \48\ in the list of 
entities considered to be principally engaged in paragraph (2) of the 
``health program or activity''

[[Page 37541]]

definition. Expressing concerns that this would result in confusion 
that the rule excludes group health plans, commenters urged OCR to 
reinstate the 2016 Rule's approach by expressly including group health 
plans in the definition of ``health program or activity.'' Former 45 
CFR 92.4.
---------------------------------------------------------------------------

    \48\ ``Group health plan'' is defined in the Employee Retirement 
Income Security Act (ERISA) as an employee welfare benefit plan to 
the extent that the plan provides medical care (as defined in 
paragraph (2) and including items and services paid for as medical 
care) to employees or their dependents (as defined under the terms 
of the plan) directly or through insurance, reimbursement, or 
otherwise. Such term shall not include any qualified small employer 
health reimbursement arrangement (as defined in 26 U.S.C. 
9831(d)(2)). 29 U.S.C. 1191b(a)(1); see also 42 U.S.C. 300gg-
91(a)(1). ``Employee welfare benefit plan'' is defined in ERISA as 
any plan, fund, or program which was heretofore or is hereafter 
established or maintained by an employer or by an employee 
organization, or by both, to the extent that such plan, fund, or 
program was established or is maintained for the purpose of 
providing for its participants or their beneficiaries, through the 
purchase of insurance or otherwise, (A) medical, surgical, or 
hospital care or benefits, or benefits in the event of sickness, 
accident, disability, death or unemployment, or vacation benefits, 
apprenticeship or other training programs, or day care centers, 
scholarship funds, or prepaid legal services, or (B) any benefit 
described in 29 U.S.C. 186(c) (other than pensions on retirement or 
death, and insurance to provide such pensions). 29 U.S.C. 1002(1).
---------------------------------------------------------------------------

    Commenters further suggested that the rule clarify that group 
health plans are covered entities when the group health plan itself 
receives Federal financial assistance or when the employer sponsoring 
the group health plan receives Federal financial assistance, such as 
through an Employer Group Waiver Plan (EGWP) or Retiree Drug Subsidy 
(RDS) plan. Some commenters argued that an employer and a group health 
plan should not be treated as distinct entities for purposes of section 
1557 jurisdiction, and that group health plans should be considered 
indirect recipients of Federal financial assistance when the employer 
receives Federal funds.
    Other commenters stated that employers are usually the sponsors of 
group health plans and were concerned that OCR's case-by-case analysis 
may find an employer liable under section 1557 based on the employee 
benefits it provides. Several commenters expressed concerns with OCR's 
proposed approach to conduct a case-by-case review to determine whether 
a group health plan is a covered entity and requested that OCR provide 
additional clarity on when employers and group health plans are liable 
under the rule.
    Response: Commenters' concerns that group health plans would never 
be subject to the rule if they are not expressly included in the 
definition of ``health program or activity'' are unwarranted. The list 
of entities included as principally engaged, at paragraph (2), is not 
exhaustive. The fact that a group health plan is not expressly included 
in paragraph (2) does not affect the determination of whether a group 
health plan is principally engaged under this definition. As group 
health plans provide or administer group health coverage, they would be 
operating a health program or activity under the rule and would be 
subject to this rule if in receipt of Federal financial assistance. 
Further, recipient group health plans, like health insurance issuers, 
would be considered to be principally engaged in the provision or 
administration of health insurance coverage or other health-related 
coverage, meaning all their operations would be covered.
    In the 2022 NPRM, we declined to expressly include group health 
plans in the definition of ``health program or activity'' in an attempt 
to reduce confusion because many group health plans do not receive 
Federal financial assistance. 87 FR 47845. It remains OCR's 
understanding that many group health plans do not receive Federal 
financial assistance, and thus we decline commenters' request to add 
group health plans to the non-exhaustive list of entities that are 
considered principally engaged that is provided in paragraph (2) of the 
definition of ``health program or activity.''
    A group health plan that receives Federal financial assistance 
itself is distinct from other entities that might separately receive 
Federal financial assistance, such as the plan sponsor of the group 
health plan or the third party administrator administering the plan. As 
such, a group health plan does not necessarily become a covered entity 
under this rule by virtue of the plan sponsor or third party 
administrator's receipt of Federal financial assistance. Single 
employers that are plan sponsors of single-employer group health plans 
and joint boards of trustees or similar bodies, associations, and other 
groups that are plan sponsors of multiemployer Taft-Hartley plans or 
multiple employer welfare arrangements (MEWAs) do not become covered 
entities under the rule due to their employment practices, including 
the provision of employee health benefits. Later in this section, we 
address how OCR will determine whether related business entities are 
considered separate legal entities under section 1557.
    When OCR receives a complaint alleging discrimination related to a 
group health plan, we will conduct a fact-specific analysis to 
determine if the group health plan is a recipient or subrecipient of 
Federal financial assistance. We decline to take the position that a 
group health plan is an indirect recipient of Federal financial 
assistance whenever the plan sponsor receives Federal financial 
assistance. Determining whether an entity is an indirect recipient 
requires a fact-specific inquiry.\49\
---------------------------------------------------------------------------

    \49\ See, e.g., Doe One v. CVS Pharmacy, Inc., No. 18-CV-01031-
EMC, 2022 WL 3139516, slip op. at 7, 9 (N.D. Cal. Aug. 5, 2022) 
(analyzing whether defendant pharmacy benefit manager is an indirect 
recipient of Federal financial assistance from defendant pharmacy 
chain and, relying on the section 1557 statute and 2020 Rule, 
holding that CVS Pharmacy, Inc. is principally engaged in the 
business of health care and all of its operations are covered by 
section 1557, including its pharmacy benefit managers Caremark, 
L.L.C. and Caremark PCS Health, L.L.C.).
---------------------------------------------------------------------------

    Entities that receive Federal financial assistance from the 
Department for an EGWP or RDS plan would be subject to this rule, 
though we note that employers and other plan sponsors are not subject 
to this rule with regard to their employment practices, pursuant to 
Sec.  92.2(b). This includes when the Federal financial assistance 
received is for their employee health benefits. For more information 
about employer and plan sponsor liability, see the previous discussion 
under Sec.  92.2(b).
    In addition, as noted in the Proposed Rule, covered entities that 
contract with a group health plan could be subject to this rule 
themselves, regardless of the group health plan's liability. For 
instance, recipient health insurance issuers may be covered under this 
rule when offering health insurance coverage to a fully-insured group 
health plan or when providing third party administrator services for a 
self-funded group health plan.\50\ We also noted in the Proposed Rule 
at 87 FR 47845 that even if a group health plan is not subject to 
section 1557, group health plans may be subject to other Federal 
nondiscrimination requirements.\51\
---------------------------------------------------------------------------

    \50\ See, e.g., Tovar v. Essentia Health, 857 F.3d 771, 778 (8th 
Cir. 2017) (holding that a third party administrator could be liable 
under section 1557 for damages arising from discriminatory terms in 
a self-funded employer-provided health plan if the third party 
administrator provided the employer with a discriminatory plan 
document, notwithstanding the fact that the employer subsequently 
adopted the plan and maintained control over its terms); C.P. v. 
Blue Cross Blue Shield of Ill., No. 20-cv-6145, 2022 WL 17788148, 
*7-9 (W.D. Wash. Dec. 19, 2022) (relying on the section 1557 statute 
because the ``2020 Rule is contrary to the statutory law, and the 
rule appears to be arbitrary, capricious and contrary to law,'' and 
holding that a health insurance issuer acting as a third party 
administrator for a self-funded employer-provided plan is a covered 
entity under section 1557, regardless of whether the discriminatory 
exclusion originated with the third party administrator, and ERISA's 
requirement that decisions be made in accordance with the plan 
documents is no defense as ERISA expressly provides that it is not 
to be construed to invalidate or impair Federal laws like section 
1557).
    \51\ For example, group health plans and health insurance 
issuers offering group or individual health insurance coverage are 
generally prohibited from establishing any rule for eligibility, 
benefits, or premiums or contributions that discriminates based on 
any health factor. 26 U.S.C. 9802: 29 U.S.C. 1182; 42 U.S.C. 300gg-
4; 26 CFR 54.9802-1; 29 CFR 2590.702; 45 CFR 146.121, 147.110.
---------------------------------------------------------------------------

    Comment: Some commenters urged OCR to expressly include pharmacy 
benefit managers in the definition of ``health program or activity.'' 
Commenters argued it was important to do so because pharmacy benefit 
managers play a significant role in developing and administering 
prescription drug benefits, and section 1557 can serve to prevent 
certain practices that may result in discriminatory access to 
medications, such as coverage criteria, utilization management 
practices, limitations on

[[Page 37542]]

where medicines can be dispensed, and high out of pocket costs.
    Response: We decline to list pharmacy benefit managers expressly in 
paragraph (2) of the definition of ``health program or activity.'' 
Pharmacy benefit managers are entities that manage prescription drug 
benefits for issuers, group health plans, Medicare Part D drug plans, 
and other payers, such as State Medicaid programs (collectively known 
as ``payers'').\52\ In their role of administering prescription drug 
benefits on behalf of payers, pharmacy benefit managers develop drug 
formularies and related policies, create pharmacy networks, reimburse 
pharmacies for patients' prescriptions, negotiate rebates and fees with 
drug manufacturers, process enrollees' claims and appeals, and review 
drug utilization, among other things.\53\ These activities constitute 
the operation of health programs and activities under section 1557.
---------------------------------------------------------------------------

    \52\ Staff of H. Comm. on Oversight & Reform, 117th Cong., A 
View from Congress: Role of Pharmacy Benefit Managers in 
Pharmaceutical Markets, 6 (Dec. 10, 2021), https://oversight.house.gov/wp-content/uploads/2021/12/PBM-Report-12102021.pdf.
    \53\ See, e.g., U.S. Gov't Accountability Off., GAO 19-19-498, 
Medicare Part D: Use of Pharmacy Benefit Managers and Efforts to 
Manage Drug Expenditures and Utilization, 14-15, 39-42 (2019), 
https://www.gao.gov/assets/gao-19-498.pdf; Visante, Pharmacy Benefit 
Managers (PBMs): Generating Savings for Plan Sponsors and Consumers, 
pp. 3-4 (2023), https://www.pcmanet.org/wp-content/uploads/2023/01/Pharmacy-Benefit-Managers-PBMs-Generating-Savings-for-Plan-Sponsors-and-Consumers-January-2023.pdf.
---------------------------------------------------------------------------

    If pharmacy benefit managers receive Federal financial assistance 
from the Department, either directly or indirectly, they are subject to 
this rule. Further, if they are principally engaged under paragraph 
(2), all their operations are covered by the rule.
    As discussed previously, the fact that a type of entity--such as a 
pharmacy benefit manager--is not expressly included in the definition 
of ``health program or activity'' does not mean that those entities are 
excluded from the rule or could never be subject to section 1557 
jurisdiction. Even if a pharmacy benefit manager does not receive 
direct Federal financial assistance, we note that the three largest 
pharmacy benefit managers are integrated with large health insurance or 
pharmacy companies, and thus could be covered under the rule as part of 
the operations of a health program or activity receiving Federal 
financial assistance.\54\ Determining whether a pharmacy benefit 
manager is subject to the rule as part of the operations of a recipient 
health program or activity is a fact-specific analysis based on the 
corporate structure of the entity.
---------------------------------------------------------------------------

    \54\ See Doe One v. CVS Pharmacy, Inc., No. 18-cv-01031-EMC, 
2022 WL 3139516, slip op. at 7, 9 (N.D. Cal., Aug. 5, 2022) (relying 
on the section 1557 statute and 2020 Rule when finding that CVS 
Pharmacy, Inc. is principally engaged in the business of health care 
and all of its operations are covered by section 1557, including its 
pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, 
L.L.C.).
---------------------------------------------------------------------------

    Comment: Commenters requested that OCR provide more clarity on how 
it will analyze whether corporate subsidiaries and related business 
entities are subject to section 1557 as part of a covered entity's 
operations. Specifically, some commenters were concerned about health 
insurance issuers that receive Federal financial assistance avoiding 
responsibility through use of subsidiaries in their other activities, 
such as third party administrators or pharmacy benefit managers. 
Conversely, other commenters expressed concerns that the rule would 
apply too broadly to an issuer's business ventures that are unrelated 
to their federally funded activities.
    Response: As stated throughout this section, if any part of a 
health program or activity receives Federal financial assistance and 
the entity administering said health program or activity is principally 
engaged as provided in paragraph (2), then all the operations of the 
recipient are subject to the rule. If a part of a recipient's 
operations is determined to be a separate legal entity independent from 
its federally funded activities, that part would not be subject to the 
rule. When determining whether an entity's subsidiaries or other 
entities are legally separate from the federally funded activities, OCR 
may consider--among other things--the organizational structure and the 
interrelatedness between the entities, such as the degree of common 
ownership, management, and control between the entities, and whether 
the entities share centralized control of labor relations; whether the 
entity has some ability to accept or reject the Federal funding or 
exercise controlling authority over a federally funded program; \55\ 
and whether the purpose of the legal separation was to avoid liability 
or avoid the application of civil rights law requirements, meaning it 
is intended to allow the entity to continue to discriminate.\56\
---------------------------------------------------------------------------

    \55\ See id. Cf. Papa v. Katy Indus., Inc., 166 F.3d 937, 939 
(7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA); 
Arrowsmith v. Shelbourne, Inc., 69 F.3d 1235, 1240-42 (2d Cir. 1995) 
(title VII); Valesky v. Aquinas Acad., 2011 U.S. Dist. LEXIS 103791, 
No. 09-800 (W.D. Pa. Sept. 14, 2011) (title IX); Russo v Diocese of 
Greenberg, 2010 U.S. Dist. LEXIS 96338, No. 09-1169 (W.D. Pa. Sept. 
15, 2010) (title IX, section 504); Margeson v. Springfield Terminal 
Railway Co., 1993 U.S. Dist. LEXIS 12243, No. CIV.A. 91-11475-Z (D. 
Mass. Aug. 24, 1993) (section 504).
    \56\ Papa v. Katy Indus., Inc., 166 F.3d 937, 941 (7th Cir. 
1999), cert. denied, 528 U.S. 1019 (1999).
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``health program 
or activity'' as proposed in Sec.  92.4, with modifications. We have 
revised paragraph (1)(iv) to include clinical research, such that it 
will now read: ``Engage in health or clinical research.'' We have also 
revised paragraph (2) to include ``a State Medicaid program, Children's 
Health Insurance Program, and Basic Health Program'' as examples of 
entities principally engaged under this definition.
    Information and communication technology (ICT). We proposed to 
define the term ``ICT'' to mean ``information technology and other 
equipment, systems, technologies, or processes, for which the principal 
function is the creation, manipulation, storage, display, receipt, or 
transmission of electronic data and information, as well as any 
associated content.'' We also provided examples of ICT in our proposed 
definition.
    Comment: Some commenters urged OCR to include ``electronic health 
records (EHRs)'' as an example within the definition of ``information 
and communication technology''.
    Response: We appreciate that there are many different examples that 
can fit within the definition of ``information and communication 
technology''. We agree that EHRs meet the definition of ``information 
and communication technology''; however, we believe that it is 
unnecessary to specify this in the final rule.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``information 
and communication technology'' as proposed in Sec.  92.4, without 
modification.
    Language assistance services. OCR proposed to define the term 
``language assistance services'' to include, but not be limited to: (1) 
oral language assistance, including interpretation in non-English 
languages provided in-person or remotely by a qualified interpreter for 
a limited English proficient individual, and the use of services of 
qualified bilingual or multilingual staff to communicate directly with 
limited English proficient

[[Page 37543]]

individuals; (2) written translation, performed by a qualified 
translator, of written content in paper or electronic form into or from 
languages other than English; and (3) written notice of availability of 
language assistance services. The definitions of oral language 
assistance and written translation appeared in both the 2016 Rule at 
former Sec.  92.4 and the 2020 Rule at Sec.  92.101 in paragraphs 
(2)(i) and (iii) and have not been changed. The 2016 Rule did not 
explicitly include a written notice of availability of language 
assistance services in the definition of ``language assistance 
services,'' but rather included the term ``taglines,'' which was 
defined to mean ``short statements written in non-English languages 
that indicate the availability of language assistance services free of 
charge.''
    Comment: One commenter recommended that the definition of 
``language assistance services'' include assistance with form 
completion in another language. The commenter noted that many 
individuals with limited English proficiency (LEP) as well as many 
others (including older individuals and those with limited access to 
technology) have difficulty completing online forms to apply for health 
benefits or report life changes.
    Response: OCR appreciates the suggestion and agrees it is critical 
for individuals with LEP to receive language assistance in completing 
forms. The definition of ``language assistance services'' is intended 
to provide a non-exhaustive list of some of the means by which a 
covered entity may facilitate such access--namely, oral interpretation 
and written translation as provided by qualified interpreters and 
translators, respectively. This definition works together with the 
requirements at Sec.  92.201, which provide that covered entities must 
take reasonable steps to provide meaningful access to individuals with 
LEP. If an individual with LEP needs assistance with form completion in 
a covered health program or activity, a covered entity must provide 
language assistance services consistent with the requirements at Sec.  
92.201. OCR declines to modify the definition of ``language assistance 
services'' as suggested because the context in which services are 
provided is not germane to the definition.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``language 
assistance services'' as proposed in Sec.  92.4, with modification. As 
discussed in the following summary of regulatory changes to the 
proposed term ``limited English proficient individual,'' we are 
revising the term to ``individual with limited English proficiency'' in 
Sec.  92.4.
    Limited English proficient individual. OCR proposed to define the 
term ``limited English proficient individual'' to mean ``an individual 
whose primary language for communication is not English and who has a 
limited ability to read, write, speak, or understand English.'' 
Further, OCR proposed that a ``limited English proficient individual'' 
``may be competent in English for certain types of communication (e.g., 
speaking or understanding), but still be limited English proficient for 
other purposes (e.g., reading or writing).'' These definitions appeared 
in the 2016 Rule and have not changed substantively. Former 45 CFR 92.4 
(2016 Rule). OCR sought comment on whether to use the term ``limited 
English proficient individual'' or ``individual with limited English 
proficiency'' throughout the rule.
    Comment: Some commenters recommended the final rule adopt the 
language either ``people with limited English proficiency'' or 
``individual with limited English proficiency'' instead of ``limited 
English proficient individual.''
    Response: OCR agrees with this recommendation and OCR is finalizing 
the rule with the term ``individual with limited English proficiency'' 
throughout.
    Comment: Several commenters supported the proposed definition's 
emphasis that an individual with LEP includes those who may be 
competent in English for certain types of communication but still have 
limited English proficiency for other purposes. Commenters explained 
that this will ensure providers and other covered entities understand 
that people who have some English competency may still need translated 
written materials. Commenters noted this will improve language access 
and have far-reaching consequences for patients who both seek and 
receive care, which will also reduce barriers to quality health care 
for individuals with LEP.
    Response: We appreciate the support of inclusion of additional 
details around what it means to be ``limited English proficient'' and 
are finalizing the definition as proposed.
    Comment: A few commenters that agreed with the proposed definition 
urged that the word ``and'' be replaced with ``or'' to read ``an 
individual whose primary language for communication is not English or 
who has a limited ability to read, write, speak, or understand English 
. . .'' These commenters explained that there are many people in the 
United States whose primary language is English but who have a limited 
ability to read, write, speak, or understand English, for reasons that 
may or may not be related to disability, who deserve protection from 
discrimination.
    Response: OCR appreciates the commenters' recommendation and 
recognizes that there are many individuals whose primary language is 
English but who have a limited ability to read, write, speak, or 
understand English. However, section 1557's language access provisions 
rely on the statute's prohibition on national origin 
discrimination.\57\ For individuals with LEP, the lack of proficiency 
in English and the use of non-English languages is often tied to their 
national origin. Changing the definition to include an individual who 
has a limited ability to read, write, speak, or understand English, but 
whose primary language is English, would go beyond national origin 
discrimination. With respect to individuals who have a limited ability 
to read, write, speak, or understand English related to disability, 
Sec.  92.202 addresses requirements for effective communication for 
individuals with disabilities, which is a long-standing requirement.
---------------------------------------------------------------------------

    \57\ See Lau v. Nichols, 414 U.S. 563, 568-69 (1974).
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``limited 
English proficient individual'' as proposed in Sec.  92.4, with 
modification. We are changing ``limited English proficient individual'' 
to ``individual with limited English proficiency'' in Sec.  92.4 and 
throughout the final rule.
    Machine translation. OCR proposed to define the term ``machine 
translation'' to mean ``automated translation, without the assistance 
of or review by a qualified human translator, that is text-based and 
provides instant translations between various languages, sometimes with 
an option for audio input or output.'' Neither the 2016 Rule nor the 
2020 Rule addressed machine translation. We invited comment on the 
adequacy of this new definition.
    Comment: We received many comments in support of the inclusion of a 
definition of ``machine translation''. One commenter supported the 
language as proposed but noted the importance of adaptability and 
potential for future regulation or guidance over time as

[[Page 37544]]

technology changes. For example, machine translation companies may 
develop technology that includes some level of human review but remains 
insufficient for the purposes of conforming with the intent of this 
rule.
    Response: We appreciate commenters' support for the inclusion of 
this definition. The requirement to provide written translations via a 
qualified translator included at Sec.  92.201(c)(2) continues to apply, 
regardless of whether human or machine translation is provided. Section 
92.201(c)(3) requires a human translator to review machine translation 
under certain circumstances. The circumstances outlined in Sec.  
92.201(c)(3) set a minimum requirement for when machine translations 
must be reviewed by a qualified human translator--including 
circumstances that are critical to one's rights or benefits. Thus, any 
machine translation technologies that are developed must include such 
review if they are to meet the requirements of this rule. OCR will 
continue to monitor the progression of this technology and will revisit 
regulatory updates as well as consider issuance of future guidance as 
needed.
    Comment: One commenter stated that the definition of ``machine 
translation'' should include reference to the use of software or 
automated tools. Specifically, the commenter recommended modifying the 
language to read ``machine translation is the use of automated 
translation software or tools, without the assistance of . . .''
    Response: OCR appreciates the commenter's suggestion to explicitly 
refer to software or automated tools; however, the definition as 
proposed sufficiently accounts for translations that would be generated 
by software or automated tools as it refers to ``automated 
translation.''
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``machine 
translation'' as proposed in Sec.  92.4, with modification. We are 
making a technical correction to change ``automated translations'' to 
``automated translation.''
    National Origin. We proposed to define the term ``national origin'' 
to mean ``a person's, or their ancestor's, place of origin or a 
person's manifestation of the physical, cultural, or linguistic 
characteristics of a national origin group.'' This is consistent with 
the 2016 Rule's definition of ``national origin,'' and with the well-
established definition of the term that the Equal Employment 
Opportunity Commission (EEOC) uses in its interpretation of title 
VII.\58\
---------------------------------------------------------------------------

    \58\ 29 CFR 1606.1; see, also, U.S. Equal Emp. Opportunity 
Comm'n, EEOC Enforcement Guidance on National Origin Discrimination, 
https://www.eeoc.gov/laws/guidance/eeoc-enforcement-guidance-national-origin-discrimination#_Toc451518799.
---------------------------------------------------------------------------

    Comment: Various commenters discussed the need to include this 
definition to address entrenched inequities and practices that can 
constitute national origin discrimination but are not always 
recognized. This includes the failure to take reasonable steps to 
provide meaningful access for individuals with LEP, even though such a 
failure has been long recognized as a form of national origin 
discrimination. Commenters added that there are also clear 
intersections between LEP status and race and ethnicity because the 
great majority of individuals with LEP are people of color; however, 
they noted that when individuals seek to vindicate their civil rights, 
they often must choose between pursuing a claim based on either their 
LEP status or race. Commenters also provided examples of how some 
people have been denied benefits they are entitled to due to national 
original discrimination. Several national organizations and local 
service providers commented that refugees, migrant workers, and other 
immigrants experience barriers to federally funded or provided health 
care due to fears related to their immigration status.
    Response: OCR appreciates commenters' support for inclusion of this 
definition. We recognize that individuals can experience both national 
origin and race discrimination (or national origin discrimination and 
discrimination on another protected basis) and are finalizing new 
regulatory language that provides additional clarity and addresses such 
instances in which individuals may experience discrimination under 
multiple bases. See discussion regarding Sec.  92.101.
    OCR appreciates comments related to immigration status. While 
section 1557 does not prohibit discrimination on the basis of 
immigration status, we note that differential treatment such as 
requiring additional verification or documentation from individuals 
based on their appearance, name, accent, LEP, or suspected immigration 
status may violate section 1557 and other civil rights laws.\59\
---------------------------------------------------------------------------

    \59\ See, e.g., U.S. Dep't of Justice, Guidance to State and 
Local Governments and Other Federally Assisted Recipients Engaged in 
Emergency Preparedness, Response, Mitigation, and Recovery 
Activities on Compliance with Title VI of the Civil Rights Act of 
1964, Section D, https://www.justice.gov/crt/fcs/EmergenciesGuidance.
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``national 
origin'' as proposed in Sec.  92.4, with modification. We are making a 
technical correction to change ``ancestor's'' to ``ancestors'.''
    Patient care decision support tool. The Proposed Rule described but 
did not include a definition in Sec.  92.4 for, the term ``clinical 
algorithms.'' See 87 FR 47880. Many commenters supported the inclusion 
of a provision such as proposed Sec.  92.210, addressing 
nondiscrimination in the use of clinical algorithms in decision-making, 
but recommended OCR clarify that the provision applies to tools used to 
assess health status, recommend care, determine eligibility, allocate 
resources, conduct utilization review, and provide disease management 
guidance. Further, commenters requested that OCR define what tools are 
covered under Sec.  92.210.
    Based on comments received, we are replacing the term ``clinical 
algorithm'' with the more precise term ``patient care decision support 
tool,'' and we are adding a definition for ``patient care decision 
support tool'' to mean ``any automated or non-automated tool, 
mechanism, method, technology, or combination thereof used by a covered 
entity to support clinical decision-making in its health programs or 
activities.'' The definition of ``patient care decision support tool'' 
reaffirms that Sec.  92.210 applies to tools used in clinical decision-
making that affect the care that patients receive. This includes tools, 
described in the Proposed Rule, used by covered entities such as 
hospitals, providers, and payers (health insurance issuers) in their 
health programs and activities for ``screening, risk prediction, 
diagnosis, prognosis, clinical decision-making, treatment planning, 
health care operations, and allocation of resources'' as applied to the 
patient. 87 FR 47880. We clarify that tools used for these activities 
include tools used in covered entities' health programs and activities 
to assess health status, recommend care, provide disease management 
guidance, determine eligibility and conduct utilization review \60\ 
related to patient care that is

[[Page 37545]]

directed by a provider, among other things, all of which impact 
clinical decision-making. Please see our discussion regarding Sec.  
92.210, where we discuss ``patient care decision support tool'' in more 
detail, including examples of tools to which Sec.  92.210 does not 
apply.
---------------------------------------------------------------------------

    \60\ See, e.g., Patrick Rucker et al., How Cigna Saves Millions 
by Having Its Doctors Reject Claims Without Reading Them, ProPublica 
(March 25, 2023), https://www.propublica.org/article/cigna-pxdx-medical-health-insurance-rejection-claims; Casey Ross & Bob Herman, 
Denied by AI: How Medicare Advantage Plans Use Algorithms to Cut Off 
Care for Seniors in Need, STAT News (March 13, 2023), https://www.statnews.com/2023/03/13/medicare-advantage-plans-denial-artificial-intelligence/.
---------------------------------------------------------------------------

Summary of Regulatory Changes
    Considering the comments received, we are finalizing the definition 
of ``patient care decision support tool'' in Sec.  92.4 to mean ``any 
automated or non-automated tool, mechanism, method, technology, or 
combination thereof used by a covered entity to support clinical 
decision-making in its health programs or activities.''
    Qualified Bilingual/Multilingual Staff. OCR proposed to define the 
term ``qualified bilingual/multilingual staff'' to mean a member of a 
covered entity's workforce who is designated by the covered entity to 
provide oral language assistance directly to an individual in their 
primary language as part of the person's current, assigned job 
responsibilities and who has demonstrated to the covered entity that 
they are: (1) proficient in speaking and understanding both spoken 
English and at least one other spoken language, including any necessary 
specialized vocabulary, terminology, and phraseology; and (2) able to 
effectively, accurately, and impartially communicate directly with 
individuals with LEP in their primary language.
    Comment: Some commenters urged that additional attention should be 
given to assessing qualifications for self-identified bilingual/
multilingual staff abilities to provide services in languages other 
than English, and that policies and procedures should be developed to 
assess and retain their competency. Additionally, some commenters 
recommended establishing qualifications for bilingual/multilingual 
staff who may also be expected to serve as interpreters, and added that 
they should be compensated appropriately. Commenters stated that 
research has shown that bilingual staff who are not qualified 
interpreters often do not feel comfortable serving as interpreters. A 
commenter posited that bilingual/multilingual staff must be provided 
training and compensation opportunities to support professional 
development and prevent staff turnover and burnout.
    Response: OCR appreciates the commenters' suggestions to establish 
assessment requirements for qualified bilingual/multilingual staff; 
however, we believe the current definition establishes sufficient 
requirements and guidelines regarding the necessary skills a qualified 
bilingual/multilingual staff member must have. The definition sets 
forth a two-prong definition to ensure proficiency, effectiveness, and 
impartiality in direct communications with individuals with LEP in 
their primary languages, including any necessary specialized 
vocabulary, terminology, and phraseology. Similar to the rule's 
definitions for qualified interpreters and qualified translators, OCR 
has established the necessary skills that must be held to meet the 
definition, while providing covered entities the flexibility by which 
to have these skills assessed. We note that an individual's self-
identification as bilingual or multilingual alone is insufficient to 
determine whether they meet this definition, and covered entities 
should determine processes by which they will independently determine 
and periodically assess an individual's qualifications.
    While qualified bilingual/multilingual employees may also be 
qualified interpreters, the ability to interpret is a separate skill. 
Anyone whom a covered entity allows to serve as an interpreter must be 
qualified to do so, consistent with the definition of ``qualified 
interpreter for an individual with limited English proficiency'' in 
this section, independent of whether they have been identified as a 
qualified bilingual/multilingual staff member. OCR will consider 
developing guidance and providing technical assistance for covered 
entities on mechanisms for covered entities to assess if staff members 
meet the requirements.
    Consistent with the Department's approach on language access, OCR 
encourages covered entities to provide training and compensation 
opportunities to support professional development for bilingual/
multilingual staff.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``qualified 
bilingual/multilingual staff'' as proposed in Sec.  92.4, with 
modification. As discussed in the summary of regulatory changes to the 
proposed term ``limited English proficient individual,'' we are 
revising the term to ``individual with limited English proficiency'' in 
Sec.  92.4.
    Qualified interpreter for an individual with a disability. We 
proposed to define the term ``qualified interpreter for an individual 
with a disability'' to mean ``an interpreter who . . . is able to 
interpret effectively, accurately, and impartially, both receptively 
and expressively, using any necessary specialized vocabulary.'' Such an 
interpreter may interpret via a video remote interpreting service (VRI) 
or in person. We also provided a non-exhaustive list of examples of 
qualified interpreters, to include sign language interpreters, oral 
transliterators, and cued-language transliterators.
    Comment: Most of the commenters recommended that OCR amend this 
definition to include the three (3) parts of the definition of 
``qualified interpreter for an individual with limited English 
proficiency'', which requires that the qualified interpreter: (1) has 
demonstrated proficiency, (2) is able to interpret effectively, 
accurately, and impartially, (3) and adheres to generally accepted 
interpreter ethics principles. Commenters noted that these revisions 
would provide alignment between the different types of interpreters and 
recognize that similar standards should apply regardless of whether an 
interpreter is interpreting for an individual with LEP or a person with 
a disability.
    Commenters recommended that the definition include that a qualified 
interpreter for a person with a disability demonstrate proficiency. For 
sign language interpreters, this should include proficiency in speaking 
or communicating in and understanding both English and a relevant sign 
language, noting that not all individuals who are deaf or hard of 
hearing are signers of American Sign Language (ASL). Some commenters 
also recommended that in order to be proficient, Certified Deaf 
Interpreters (CDI) must have specialized training in Deaf interpreting 
in addition to the basic CDI training. For transliterators, these 
commenters recommended that the rule require proficiency in the 
relevant alternative communication modality, such as cued speech or 
oral transliteration.
    Commenters further stated that an interpreter for an individual 
with a disability should communicate ``without changes, omissions, or 
additions while preserving the tone, sentiment, and emotional level of 
the original statement.''
    Finally, commenters stated that an interpreter for an individual 
with a disability must also adhere to the principles contained in 
recognized standards of practice and professional codes of ethics for 
health care interpreters, such as those of the National Council on 
Interpreting in Health Care and the Registry of Interpreters for the 
Deaf.
    Response: We appreciate commenters' recommendation to revise the 
definition

[[Page 37546]]

of ``qualified interpreter for an individual with a disability'' to 
align more closely with the definition of ``qualified interpreter for 
an individual with limited English proficiency''. While the proposed 
definition is consistent with the ADA, we agree that the standards for 
a qualified interpreter should be equivalent regardless of whether an 
individual has LEP or has a disability. We have revised the definition 
for consistency among the standards, which is also consistent with the 
2016 Rule's definition at former 45 CFR 92.4.
    Comment: Some commenters recommended aligning the two qualified 
interpreter definitions but recommended that a revised definition be 
expanded to recognize qualified interpreters who have demonstrated 
proficiency in speaking and understanding two non-English languages. 
These commenters noted that not all interpreters for people with 
disabilities are interpreting between English and another language. For 
example, these commenters noted that a CDI may be interpreting between 
an individual who is deaf and uses a unique version of ASL and a non-
American sign language, or home signs unfamiliar to the medical 
interpreter. Commenters were concerned that a definition that specified 
interpretation ``between English and non-English language'' would 
exclude CDIs and cued-language transliterators. These commenters 
recommended a multi-pronged definition where several contexts are taken 
into consideration and is inclusive of ASL-to-English interpretation, 
ASL-to-ASL CDI interpretation, and cued-language transliteration.
    Response: As proposed, the definition of ``qualified interpreter 
for an individual with a disability'' does not reference ``English'' or 
a ``non-English language,'' but rather included a non-exhaustive list 
of examples of qualified interpreters inclusive of sign language 
interpreters, oral transliterators, and cued-language transliterators. 
However, as previously discussed, we have revised the definition of 
``qualified interpreter for an individual with a disability'' to be 
more aligned with the definition of ``qualified interpreter for an 
individual with limited English proficiency.'' The revised definition 
includes language that is inclusive of different types of 
interpretation and also includes the non-exhaustive list of examples 
from the proposed definition.
    Comment: Some commenters noted that a covered entity must not use 
the services of staff who use sign language or another communication 
modality to act as interpreters and relay information to individuals 
with disabilities unless they meet the definition of a ``qualified 
interpreter for an individual with a disability'' found within this 
section, and they meet the unique needs of the individual for whom the 
services of an interpreter is being provided.
    Response: The definition of a ``qualified interpreter for an 
individual with a disability'' addresses these concerns; and anyone 
designated by a covered entity to serve as an interpreter for an 
individual with a disability must be qualified to do so.
    Comment: Some commenters recommended that the definition of 
``qualified interpreter for a person with a disability'' take into 
consideration applicable State law governing licensure of interpreters 
if any are available in the State where the covered entity provides 
services. These commenters noted that the process of who can serve as a 
qualified interpreter differs from State to State, and OCR should adopt 
language that reflects the minimum standards of State laws governing 
qualifications of sign language interpreters, if any.
    Response: OCR understands and appreciates commenters raised 
concerns. Covered entities may use adherence to State law governing 
licensure as a means by which to demonstrate compliance with this 
definition, provided licensure demonstrates the individual possesses 
the requirements provided in the definition. OCR declines to adopt 
language that incorporates any State law licensure requirements as a 
minimum standard of compliance with this rule.
    Comment: Some commenters raised concerns over the qualifications of 
interpreters. Commenters recommended that the definition include the 
requirement that an interpreter be certified or assessed by a formal 
process that objectively measures the competency of the individual. 
Other commenters recommended that health care entities include a 
screening system to ensure quality assurance of the abilities of the 
sign language interpreters to meet the needs of the patients.
    Response: OCR appreciates the commenters' recommendations to 
require certification for qualified interpreters and agrees that 
covered entities should ensure that the use of interpreter services 
provides for effective communication. OCR will take into account 
certification in assessing compliance with this regulation; however, as 
we will discuss below in the response for certification of qualified 
interpreter for an individual with LEP in Sec.  92.201, we decline to 
require certification in the definition of ``qualified interpreter for 
an individual with a disability.''
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``qualified 
interpreter for an individual with a disability'' in Sec.  92.4, to 
more closely align with the definition of ``qualified interpreter for 
an individual with limited English proficiency,'' such that it now 
means an interpreter who, via a video remote interpreting service (VRI) 
or an on-site appearance: (1) has demonstrated proficiency in 
communicating in, and understanding: (i) both English and a non-English 
language (including American Sign Language, other sign languages); or 
(ii) another communication modality (such as cued-language 
transliterators or oral transliteration); (2) is able to interpret 
effectively, accurately, and impartially, both receptively and 
expressively, using any necessary specialized vocabulary or terms 
without changes, omissions, or additions and while preserving the tone, 
sentiment, and emotional level of the original statement; and (3) 
adheres to generally accepted interpreter ethics principles including 
client confidentiality. Qualified interpreters include, for example, 
sign language interpreters, oral transliterators, and cued-language 
transliterators.
    Qualified interpreter for a limited English proficient individual. 
OCR proposed to define the term ``qualified interpreter for a limited 
English proficient individual'' to mean an interpreter who via a remote 
interpreting service or an on-site appearance: (1) has demonstrated 
proficiency in speaking and understanding both spoken English and at 
least one other spoken language; (2) is able to interpret effectively, 
accurately, and impartially to and from such language(s) and English, 
using any necessary specialized vocabulary or terms without changes, 
omissions, or additions and while preserving the tone, sentiment, and 
emotional level of the original oral statement; and (3) adheres to 
generally accepted interpreter ethics principles, including client 
confidentiality. This definition is consistent with both the 2016 Rule 
at former Sec.  92.4 and the 2020 Rule at Sec.  92.101(b)(3)(i).
    Comment: Some commenters who otherwise supported this definition 
expressed concern that, as written, it may inadvertently create 
difficulties for interpreting in certain languages, especially 
indigenous languages of Central and South America. These

[[Page 37547]]

commenters recommended that the definition be amended to allow for the 
use of services of relay interpreters, such as those who are proficient 
in an indigenous language and another language such as Spanish. 
Commenters explained that these interpreters may not be fluent in 
spoken English or trained to interpret to and from spoken English, and 
that those who are qualified to interpret between two non-English 
languages are critical in providing meaningful access for many isolated 
and marginalized communities. Furthermore, a few of these commenters 
recommended the inclusion of the following definition for relay 
interpreting: ``relay interpreting means a form of simultaneous 
interpreting when the speech is rendered from an intermediate language 
rather than directly from the source language.''
    One commenter recommended adding ``and dialect'' after ``spoken 
language'' under paragraph (1) to acknowledge that speakers of a 
language may not always be qualified to interpret for a person who 
speaks a variation in that language and adding ``understanding and'' 
before ``using necessary specialized vocabulary or terms'' under 
paragraph (2) to indicate that providing effective interpretation for 
complex situations, such as communicating a treatment regimen, requires 
understanding of the terminology being used, particularly given the 
consequences of a miscommunication.
    Response: OCR appreciates and understands concerns that the 
proposed definition may inadvertently create obstacles for meaningful 
access in certain languages. For example, if a Zapotec-speaking patient 
with LEP attended a medical appointment and the hospital could not find 
an individual qualified to interpret between Zapotec and English after 
reasonable efforts, the hospital could utilize the services of two 
qualified interpreters that could perform relay interpretation between 
Zapotec and Spanish and Spanish and English. While relay interpretation 
may introduce challenges related to accuracy, it may be necessary to 
afford meaningful access for individuals who speak languages, dialects, 
or variants not common to the area where they are receiving services.
    For this reason, we are revising the definition of a ``qualified 
interpreter for an individual with limited English proficiency'' to 
provide that the qualified interpreter (1) has demonstrated proficiency 
in speaking and understanding both spoken English and at least one 
other spoken language (qualified interpreters for relay interpretation 
must demonstrate proficiency in two non-English spoken languages); and 
(2) is able to interpret effectively, accurately, and impartially to 
and from such language(s) and English (or between two non-English 
languages for relay interpretation), using any necessary specialized 
vocabulary or terms without changes, omissions, or additions and while 
preserving the tone, sentiment, and emotional level of the original 
oral statement. This provision makes clear that specialized skills and 
vocabulary may be needed for less commonly spoken languages as well as 
dialects.
    In light of these modifications to the definition of ``qualified 
interpreter for an individual with limited English proficiency'', we 
are also adding and finalizing a definition of ``relay interpretation'' 
to mean interpreting from one language to another through an 
intermediate language. This mode of interpretation is often used for 
monolingual speakers of languages of limited diffusion, including 
select indigenous languages. In relay interpreting, the first 
interpreter listens to the speaker and renders the message into the 
intermediate language. The second interpreter receives the message in 
the intermediate language and interprets it into a third language for 
the speaker who speaks neither the first nor the second language.
    Lastly, OCR appreciates the commenter's suggestion to add 
``understanding and'' before ``using necessary specialized vocabulary 
or terms'' under paragraph (2). However, the interpreter themself does 
not need to understand complex medical concepts behind medical terms 
but rather must be able to interpret said terms effectively and 
accurately. OCR is of the view that the interpretation should directly 
convey the provider and patient's words and phrases in order to avoid 
the risk that the individual's message was not accurately communicated. 
Further, paragraph (1) already requires that the interpreter have 
``proficiency in speaking and understanding'' the languages at issue 
(emphasis added).
    Comment: A few commenters recommended the definition address how an 
individual would demonstrate proficiency in English and another 
language (i.e., through use of an established standard for describing 
language ability, such as the Common European Framework of Reference of 
Languages \61\). Some commenters recommended implementing a 
certification requirement and suggested implementing a national 
credential requirement that establishes interpretation proficiency for 
enforcement purposes. Some commenters requested that OCR lay out 
examples of when it would be appropriate to require qualified 
interpreters to obtain certification in order to comply with section 
1557. Commenters expressed their belief that the proposed definition 
could be easily misinterpreted and result in assigning the least 
skilled interpreter for a medical encounter.
---------------------------------------------------------------------------

    \61\ Council of Europe, Common European Framework of Reference 
for Languages (CEFR), https://www.coe.int/en/web/common-european-framework-reference-languages/introduction-and-context.
---------------------------------------------------------------------------

    Response: OCR appreciates the commenters' suggestions to establish 
certification requirements for qualified interpreters; however, there 
are currently no consistent certification standards and there is also a 
lack of certification available for a significant number of languages. 
The requirements in this definition provide sufficient standards for 
determining interpreter qualifications. Individuals that hold a 
certification will still need to meet the standards provided in this 
definition. For covered entities seeking information on certification, 
we encourage covered entities to review the Department of Justice's 
(DOJ) resource regarding what it means to be a certified linguist.\62\
---------------------------------------------------------------------------

    \62\ U.S. Dep't of Justice, Fed. Coordination & Compliance 
Section, What Does It Mean to Be a Certified Linguist (2014), 
https://www.justice.gov/crt/page/file/1255916/download.
---------------------------------------------------------------------------

    Comment: One commenter encouraged OCR to include ``via a video 
remote interpreting service'' to the definition because telehealth can 
be an important tool for expanding access to interpretation for 
individuals with LEP.
    Response: The definition as proposed and finalized includes 
interpreter services provided via remote interpreting services and is 
therefore inclusive of video remote interpreting as drafted.
    Comment: One commenter noted that we use the phrase ``use an 
interpreter'' in our text. They recommended we use the wording 
``utilize the services of an interpreter'' instead.
    Response: OCR agrees that we are referring to the utilization of 
interpreter services and have adjusted the use of this phrase 
accordingly.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments we received, we are revising the definition for a ``qualified 
interpreter for an individual with limited English proficiency'' as 
proposed in Sec.  92.4, with modifications. To account for concerns 
related to relay

[[Page 37548]]

interpreting, we are revising paragraph (1) to add ``(qualified 
interpreters for relay interpretation must demonstrate proficiency in 
two non-English spoken languages).'' As discussed in the summary of 
regulatory changes to the proposed term ``limited English proficient 
individual'' we are revising the term to ``individual with limited 
English proficiency'' in Sec.  92.4. We are also adding a definition of 
``relay interpretation'' to Sec.  92.4 to mean interpreting from one 
language to another through an intermediate language. This mode of 
interpretation is often used for monolingual speakers of languages of 
limited diffusion, including select indigenous languages. In relay 
interpreting, the first interpreter listens to the speaker and renders 
the message into the intermediate language. The second interpreter 
receives the message in the intermediate language and interprets it 
into a third language for the speaker who speaks neither the first nor 
the second language.
    Qualified Reader. We proposed to define the term ``qualified 
reader'' to mean ``a person who is able to read effectively, 
accurately, and impartially using any necessary specialized 
vocabulary,'' which comes from the ADA title II regulation at 28 CFR 
35.160 through 35.164. This definition, which did not appear in the 
2016 or 2020 Rules, was included to provide clarity to both covered 
entities and protected individuals about the necessary qualifications 
of a reader when required under this regulation.
    Comment: Commenters supported the addition of ``qualified reader'' 
to the proposed list of definitions.
    Response: OCR appreciates the commenters support for adding the 
definition of ``qualified reader'' to the proposed list of definitions.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments we received, we are finalizing the definition of ``qualified 
reader'' as proposed in Sec.  92.4, without modification.
    Qualified Translator. OCR proposed to define the term ``qualified 
translator'' to mean a translator who: (1) has demonstrated proficiency 
in writing and understanding both written English and at least one 
other written non-English language; (2) is able to translate 
effectively, accurately, and impartially to and from such language(s) 
and English, using any necessary specialized vocabulary or terms 
without changes, omissions, or additions and while preserving the tone, 
sentiment, and emotional level of the original written statement; and 
(3) adheres to generally accepted translator ethics principles, 
including client confidentiality. This definition of ``qualified 
translator'' appeared in the 2016 Rule at Sec.  92.4 and appears in the 
2020 Rule at Sec.  92.102(b)(2)(ii) and has not been changed.
    Comment: One commenter recommended that the definition of a 
``qualified translator'' include the requirement that such individuals, 
for purposes of providing translation services, be certified or 
assessed by a formal process that objectively measures the competency 
of the individual. A number of commenters stated that high quality 
translation is essential to providing equal access to health care and 
health services. Some added that oral interpretation is critical to 
ensuring understanding of written translations, some of which have been 
inaccurate or insufficient to convey the complicated medical and 
technical terms translated in the communications.
    Response: OCR appreciates the commenter's suggestion to require 
that a qualified translator be certified or objectively assessed to 
verify competency in translating. For the reasons we provided when 
declining to require certification of qualified interpreters for 
individuals with LEP, we decline to specify the means by which a 
covered entity may determine that an individual meets the definition of 
``qualified translator''. In order to be qualified, translators must 
meet the definition provided in the rule. OCR also notes that 
reasonable steps to provide meaningful access may require the provision 
of both written translation and oral interpreting, and thus utilizing 
the services of both a qualified translator and a qualified interpreter 
may be necessary under certain circumstances.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the definition of ``qualified 
translator'' as proposed in Sec.  92.4, without modification.
    State. The 2022 NPRM did not propose a definition of the term 
``State.'' However, based on comments received, we became aware that 
there may be some confusion as to what encompasses ``State'' for 
purposes of this final rule. We therefore have decided to include a 
definition of ``State.''
Summary of Regulatory Changes
    Considering the comments received, we are finalizing a definition 
of ``State'' in Sec.  92.4 to mean ``each of the several States, the 
District of Columbia, the Commonwealth of Puerto Rico, Guam, American 
Samoa, the Virgin Islands, the Trust Territory of the Pacific Islands, 
and the Commonwealth of the Northern Mariana Islands.'' This definition 
is consistent with the ADA regulations at 28 CFR 35.104.
    Telehealth. The 2022 NPRM did not propose a definition of the term 
``telehealth.'' However, based on comments received, we became aware 
that there may be some confusion as to what encompasses ``telehealth'' 
for purposes of this final rule. We therefore have decided to include a 
definition of ``telehealth.''
Summary of Regulatory Changes
    Considering the comments received, we are finalizing a definition 
of ``telehealth'' in Sec.  92.4 to mean the use of electronic 
information and telecommunications technologies to support long-
distance clinical health care, patient and professional health-related 
education, public health, and health administration. Technologies 
include videoconferencing, the internet, store-and-forward imaging, 
streaming media, and terrestrial and wireless communications. This 
definition is consistent with the Health Resources and Services 
Administration and the Office of the National Coordinator for Health 
Information Technology definitions referenced in the 2022 NPRM, 87 FR 
47884.
Assurances Required (Sec.  92.5)
    In Sec.  92.5 of the 2022 NPRM, we proposed retaining the 
requirement of the 2016 and 2020 Rules, at former Sec.  92.5 and 
current Sec.  92.4 respectively, for recipients to submit assurances of 
compliance to OCR. In paragraph (a), we proposed that each entity 
applying for Federal financial assistance, each issuer seeking 
certification to participate in an Exchange, and each State seeking 
approval to operate a State Exchange is required to submit an assurance 
that its health programs and activities will be operated in compliance 
with section 1557 and this part, consistent with similar requirements 
found in the implementing regulations for title VI, title IX, section 
504, and the Age Act. The duration of obligation (proposed paragraph 
(b)), and covenants language (proposed paragraph (c)) adopt the 
corresponding requirements found in the section 504 regulation at 45 
CFR 84.5.
    The comments and our responses regarding Sec.  92.5 are set forth 
below.
    Comment: Commenters expressed support for the assurances provision 
included in the 2022 NPRM because it

[[Page 37549]]

is consistent with other Federal civil rights regulations and the 2016 
and 2020 Rules, and it is reasonable for OCR to require recipients of 
Federal financial assistance to comply with section 1557 as a condition 
of receiving that funding. One organizational commenter recommended 
revising this requirement to conditioning prospective recipients' 
receipt of Department Federal financial assistance on recipients': (1) 
collection of demographic data such as race, ethnicity, spoken and 
written language, disability status, age, sex, gender identity, sex 
characteristics, and sexual orientation; and (2) submission of a 
written proposal (including through written policies and procedures) 
about how they intend to provide language assistance services, 
auxiliary aids and services, and whether an entity's proposed budget 
includes funding to meet these identified needs.
    Response: We appreciate the suggestion to include a data collection 
requirement in this provision, but do not believe such a requirement is 
appropriate, as this language is longstanding and consistent across 
civil rights regulations. We address data collection in further detail 
later in this preamble, when discussing responses to our request for 
comment on the issue.
    We also decline to revise Sec.  92.5 to require Federal financial 
assistance applicants to provide OCR with budget information and a 
written proposal about how they intend to provide language assistance 
services and auxiliary aids and services as a condition of receiving 
Federal financial assistance. The combined requirements at Sec. Sec.  
92.8 (Policies and procedures), 92.201 (Meaningful access for 
individuals with LEP), 92.202 (Effective communication for individuals 
with disabilities), and 92.205 (Requirement to make reasonable 
modifications) address the commenter's concerns regarding a recipient's 
obligation and ability to provide language assistance services and 
auxiliary aids and services.
    Comment: One commenter raised concerns that proposed Sec.  92.5's 
requirement that recipients make assurances to comply with all 
provisions of the rule does not take into account situations where a 
third party administrator could otherwise lawfully administer a plan 
sponsored by a religious employer that does not conform to OCR's 
current interpretation of section 1557 with regard to the prohibition 
on sex discrimination. Specifically, the commenter suggested that a 
third party administrator may be inhibited from submitting an assurance 
required by Sec.  92.5 because (1) of the Employee Retirement Security 
Act of 1974 (ERISA), 29 U.S.C. 1104(a)(1)(D), which for example, 
obligates such a third party administrator to administer the religious 
employer's self-insured health plan in accordance with terms that may 
conflict with section 1557's prohibition of sex discrimination; and (2) 
there are injunctions that currently prohibit OCR from enforcing 
prohibitions on sex discrimination against religious employers and 
those acting in concert with them.\63\
---------------------------------------------------------------------------

    \63\ Franciscan All., 553 F. Supp. 3d at 378.
---------------------------------------------------------------------------

    Response: OCR complies with court orders, including court-ordered 
injunctions. If a recipient third party administrator is covered by any 
current court order or court-ordered injunction, OCR would not find the 
third party administrator to be in violation of section 1557 or this 
rule for its activities that are covered by the injunction, and such an 
entity would not need to provide an assurance under Sec.  92.5 to the 
extent it conflicts with a current court order or court-ordered 
injunction by which they are covered.
    Regarding the commenter's point that third party administrators are 
required under ERISA to administer plans consistent with the plan's 
terms, OCR addresses this issue in detail under the third party 
administrator section of Sec.  92.207. In short, while we acknowledge 
that ERISA requires plans to be administered consistent with the 
documents and instruments governing the plan,\64\ ERISA further 
provides that it is not to be construed to impair or supersede other 
Federal laws, including regulations issued under such laws.\65\ Courts 
have held that ERISA's requirement to comply with the terms of the plan 
must not be construed to invalidate or impair section 1557.\66\
---------------------------------------------------------------------------

    \64\ 29 U.S.C. 1104(a)(1)(D) (``[A] fiduciary shall discharge 
his duties with respect to a plan solely in the interest of the 
participants and beneficiaries and . . . in accordance with the 
documents and instruments governing the plan insofar as such 
documents and instruments are consistent with the provisions of this 
subchapter and subchapter III.'').
    \65\ 29 U.S.C. 1144(d) (``Nothing in this subchapter shall be 
construed to alter, amend, modify, invalidate, impair, or supersede 
any law of the United States (except as provided in sections 1031 
and 1137(b) of this title) or any rule or regulation issued under 
any such law.'').
    \66\ See, e.g., C. P. by & through Pritchard v. Blue Cross Blue 
Shield of Ill., No. 3:20-CV-06145-RJB, 2022 WL 17788148, at *8, 10 
(W.D. Wash. Dec. 19, 2022) (holding that ERISA's requirement at 29 
U.S.C. 1104(a)(1)(D) to administer a plan's terms as written ``is 
subservient to Section 1557, outlawing discrimination, which is 
dominant''); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. 
Minn. 2018) (``The Court will not construe ERISA to impair Section 
1557. Nothing in Section 1557, explicitly or implicitly, suggests 
that TPAs are exempt from the statute's nondiscrimination 
requirements.'').
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.5, without modification.
Remedial Action and Voluntary Action (Sec.  92.6)
    In Sec.  92.6, OCR proposed to include requirements regarding 
remedial and voluntary action, which would reinstate former Sec.  92.6 
in the 2016 Rule and is consistent with parallel requirements in the 
implementing regulations for section 504, title IX, and the Age Act. 
The 2020 Rule does not include a similar provision. In Sec.  92.6(a)(1) 
of the 2022 NPRM, we proposed requiring recipients or State Exchanges 
that have been found by the Director to have engaged in discriminatory 
conduct in their health programs and activities in violation of this 
part to take voluntary actions to remediate the effects of such 
discriminatory conduct. Similarly, we proposed that under Sec.  
92.6(a)(2), where a recipient exercises control over another recipient 
that has discriminated, the Director may require either or both 
entities to take remedial action. Under proposed Sec.  92.6(a)(3), a 
recipient or State Exchange must take remedial action if OCR requires 
such action to redress the harm experienced by an individual who was 
subjected to prohibited discrimination. Under proposed Sec.  92.6(b), a 
covered entity may voluntarily take nondiscriminatory steps to overcome 
the effects of the conditions that limited an individual's ability to 
participate in a health program or activity based on their race, color, 
national origin, sex, age, or disability.
    The comments and our responses regarding Sec.  92.6 are set forth 
below.
    Comment: Commenters generally supported the requirement that a 
recipient remedy instances of confirmed discrimination and the 
voluntary action provision that allows for covered entities to address 
effects of past discrimination.
    One commenter recommended that we limit the application of this 
provision to avoid exposing recipients to unfair and specious claims of 
discrimination. Specifically, the commenter suggested that the remedial 
action be limited to: (1) individuals who applied to participate in a 
health program or activity but were unable to participate due to 
alleged discrimination; or (2) individuals who had been participants in 
a health program or activity but are no longer participants due to 
alleged discrimination.

[[Page 37550]]

    Response: This provision is an essential tool in remediating 
findings of discrimination and encouraging recipients to take voluntary 
actions to overcome potential discrimination. The suggested revisions 
to Sec.  92.6 are unnecessary, as they generally request implementing 
conditions that are already present. For example, Sec.  92.6(a)(1) 
requires remedial action by a recipient or State Exchange only after a 
finding of discrimination. Section 92.6(a)(3) limits any required 
remedial action in the spirit of the commenter's recommendation, namely 
providing that recipients and State Exchanges take remedial action with 
respect to individuals who were or would have been participants in the 
health program or activity had the discrimination not occurred.
    Covered entities are prohibited from discriminating and as such 
should take steps to ensure nondiscrimination, even in the absence of a 
finding of discrimination by OCR. Where a covered entity has identified 
conditions that currently or in the past had resulted in limited 
participation in their health programs and activities by individuals 
protected by this rule, they are encouraged to take the voluntary 
action contemplated in Sec.  92.6(b).
    We also note that regulations for section 504, title IX, and the 
Age Act require recipients to take remedial action, and recipients have 
complied with the remedial action provisions in those civil rights 
statutes for more than 40 years.\67\ For example, where there is a 
finding that a recipient engaged in disability discrimination, the 
recipient's remedial action to overcome the effects of the disability 
discrimination would likely satisfy this provision's remedial action 
requirement as well as section 504's remedial action requirement at 45 
CFR 84.6(a).
---------------------------------------------------------------------------

    \67\ See 45 CFR 84.6(a) and (b) (section 504); 86.3(a) and (b) 
(title IX); and 91.48 (Age Act).
---------------------------------------------------------------------------

    Comment: Another commenter expressed concern about the obligation 
this provision places on a recipient that exercises control over 
another recipient that is found to have engaged in discrimination 
prohibited by section 1557. The commenter recommended that OCR revise 
the provision so that only the recipient that OCR found to have engaged 
in unlawful discrimination (and not the controlling entity) take 
remedial action and that OCR enumerate specific remedial actions OCR 
may require and the circumstances under which OCR may require them.
    Response: The word ``control'' has appeared in civil rights 
regulations enforced by OCR for many years, and its meaning has been 
established over time. As we explained in the preamble for the 2016 
Rule, OCR's experience and the longstanding approach for controlling 
entities to secure appropriate action from discriminating entities over 
which they have control has played an important role in remedying 
discrimination. 81 FR 31393. Given that nothing has changed in OCR's 
experience in the intervening years regarding the principles of 
``control'' as applied here, we decline to define the term ``control.''
    While we appreciate the commenter's request to list the remedial 
actions OCR may require of a recipient or State Exchange found in 
violation of this part, the remedial actions that a recipient or State 
Exchange must take to address confirmed discrimination will be subject 
to the facts involved in a particular case. A review of past resolution 
agreements provides useful, though not exhaustive, examples of the 
variety of means by which OCR achieves corrective action.\68\
---------------------------------------------------------------------------

    \68\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Recent Civil Rights Resolution Agreements & Compliance Reviews, 
https://www.hhs.gov/civil-rights/for-providers/compliance-enforcement/agreements/.
---------------------------------------------------------------------------

    Comment: One commenter recommended that OCR revise Sec.  92.6 to 
require a recipient or State Exchange to notify participants, 
enrollees, and beneficiaries of any finding of discrimination by the 
Director and the remedial action the recipient has taken or will take 
to address the confirmed discrimination.
    Response: We recognize the benefit that notice of confirmed 
discrimination and the steps a recipient or State Exchange will take to 
remedy the discrimination can provide to participants, enrollees, and 
beneficiaries. While we encourage recipients and State Exchanges to 
provide notice to participants, we decline to require they do so. 
Current Federal civil rights regulations with similar remedial and 
voluntary action provisions do not include a notice requirement, and we 
do not believe imposing such a requirement on recipients and State 
Exchanges is warranted at this time. We note, however, it is OCR's 
practice to notify the public via a press release or posting on our 
website when a violation has been found or a resolution has been 
reached.\69\ Additionally, OCR has established a Civil Rights listserv 
to inform the public about civil rights settlement and enforcement 
activities, press releases, FAQs, guidance, and technical assistance 
materials. To subscribe to OCR's Civil Rights listserv, please visit 
https://list.nih.gov/cgi-bin/wa.exe?SUBED1=OCR-CIVILRIGHTS-LIST&A=1.
---------------------------------------------------------------------------

    \69\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Civil Rights News Releases & Bulletins, https://www.hhs.gov/civil-rights/newsroom/.
---------------------------------------------------------------------------

    Comment: One commenter recommended that, for Sec.  92.6(b) 
(voluntary action), we replace ``may'' with ``must'' to require covered 
entities to take nondiscriminatory steps to overcome effects that 
result or resulted in limiting participants ability to participate in 
the covered entity's health program or activities based on the 
participants' race, color, national origin, sex, age, or disability.
    Response: Such a revision would alter the voluntary nature of the 
provision, which encourages covered entities to take nondiscriminatory 
steps on their own accord to make their programs more inclusive absent 
a finding of discrimination. We note that, when there is a finding that 
prohibited discrimination occurred, Sec.  92.6(a) mandates the 
offending recipient or State Exchange to take action to remedy such 
discrimination.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.6, without modification.
Designation and Responsibilities of a Section 1557 Coordinator (Sec.  
92.7)
    In proposed Sec.  92.7(a), OCR proposed requiring covered entities 
with 15 or more employees to designate at least one employee to serve 
as a Section 1557 Coordinator (``Coordinator'') to coordinate their 
efforts to comply with and carry out the covered entity's 
responsibilities under section 1557 and the part. OCR also proposed to 
permit covered entities to, as appropriate, assign one or more 
designees to carry out some of the responsibilities of the Coordinator.
    In Sec.  92.7(b), we proposed a list of responsibilities of the 
Coordinator. We invited comment on this requirement, including whether 
OCR should require covered entities with fewer than 15 employees to 
designate a Coordinator and, if so, whether there should be a requisite 
number of employees or whether all covered entities should be required 
to designate a Coordinator. We further sought comment on whether the 
enumeration of responsibilities of the Coordinator is beneficial and 
sufficiently comprehensive. We also requested comment on how the

[[Page 37551]]

Department can support Coordinators, including through the provision of 
training, so that they understand their duties, the protections 
afforded by section 1557, and the rationales for both.
    The comments and our responses regarding Sec.  92.7 are set forth 
below.
    Comment: Commenters on this provision overwhelmingly supported the 
Coordinator requirement at Sec.  92.7. A number of supportive 
commenters indicated that civil rights violations often occur due to 
ignorance, neglect, and administrative indifference, and Coordinators 
will equip providers with critical civil rights knowledge and the 
ability to recognize and adequately care for patients at risk for poor 
health outcomes. Other commenters similarly emphasized that the 
Coordinator requirement will equip covered entities with an internal 
resource dedicated to section 1557 implementation and compliance, and 
that this is especially critical for small covered entities and covered 
entities in rural communities. Commenters cited a number of other 
reasons for their support of the Coordinator requirement, including 
that having a Coordinator will help covered entities proactively 
protect civil rights; will provide central points of contact for 
language access; and will allow covered entities and OCR to better 
identify patterns or practices of discrimination, which will aid 
covered entities in delivering effective and efficient care.
    One commenter expressed concern about the possibility that 
Coordinators evolve and become ineffective by privileging the 
institutions they serve rather than appropriately conducting thorough 
investigations of grievances. Relatedly, another commenter recommended 
that OCR revise Sec.  92.7 to require covered entities' Coordinators to 
be independently minded or independent from the covered entity to 
ensure impartiality and transparency and to require that Coordinators 
be able to work independently.
    Many of these commenters cited the COVID-19 Public Health Emergency 
as a reason for their support of the Coordinator requirement. 
Specifically, they stated that the health outcomes resulting from the 
COVID-19 pandemic highlighted covered entities' ignorance of civil 
rights regulations with respect to individuals from marginalized 
communities.
    Response: We agree with commenters regarding the myriad benefits of 
the Coordinator requirement, particularly with regard to increasing 
covered entities' ability to proactively prevent discrimination before 
it happens and hopefully more thoroughly address it when it does. 
Coordinators are expected to perform their impartially, which will also 
benefit covered entities through ensuring compliance with section 1557.
    OCR appreciates commenters' concerns that Coordinators be 
sufficiently independent from a covered entity to ensure impartiality 
and transparency. We note that a covered entity may run the risk of 
noncompliance with section 1557 if an investigation reveals that its 
Coordinator did not carry out their obligations under section 1557 in 
an impartial manner. By having a Coordinator, with specific compliance 
responsibilities, OCR expects that covered entities will be cognizant 
of the importance of compliance with civil rights requirements, 
including in times of public health emergencies or other crises.
    Comment: Other commenters opposed the Coordinator requirement, 
contending that it will increase the burdens covered entities will 
face.
    One commenter reiterated the 2020 Rule's reasoning for eliminating 
the Coordinator requirement by stating that regulations for underlying 
civil rights statutes requiring coordinators is sufficient for section 
1557 enforcement. Another commenter stated covered entities can meet 
section 1557 compliance obligations without a Coordinator. Yet another 
commenter recommended that OCR instead encourage practices to adopt a 
collaborative approach where all staff take an active role in ensuring 
nondiscrimination.
    Response: The role of the Coordinator is to promote effective and 
efficient implementation of section 1557 and the part, and in so doing 
decrease compliance inefficiencies and promote meaningful 
investigations of allegations of potential civil rights violations.
    OCR remains confident that the benefits to a covered entity and the 
public of the Coordinator requirement outweigh any potential burdens. 
Time spent coordinating a covered entity's section 1557 compliance 
program is an investment that will likely result in improved, 
nondiscriminatory health care delivery and saving resources otherwise 
spent responding to potential OCR investigations and private 
litigation. Even if a covered entity is subject to a civil rights 
complaint or litigation, its Coordinator's presence and active 
coordination efforts may enable the covered entity to more quickly 
resolve a complaint or litigation.
    This rule addresses the confusion that the 2020 Rule creates 
surrounding the extent to which covered entities were required to 
maintain a Coordinator for purposes of section 1557 compliance. The 
2020 Rule does not clarify, for example, whether a covered entity's 
existing section 504 coordinator--whose role relates to ensuring a 
recipient's efforts to comply section 504 alone, per 45 CFR 84.7--must 
also ensure the covered entity's compliance with section 1557's 
prohibition of discrimination based on race, color, national origin, 
age, or sex. OCR is providing for a specific Section 1557 Coordinator, 
rather than relying on the requirements found in the implementing 
regulations for the referenced statutes, to resolve any confusion as to 
covered entities' responsibilities.
    Comment: Some commenters requested that OCR clarify that 
Coordinators are responsible for covered entities' internal section 
1557 oversight and that covered entities may have other staff members 
implement various Coordinator activities. These commenters recommended 
that OCR revise Sec.  92.7(b) to add ``or designee'' after ``Section 
1557 Coordinator'' to confirm that one or more staff can assist the 
Coordinator with the enumerated Coordinator responsibilities. Some 
commenters requested clarity about whether a covered entity's 
Coordinator can also serve in other capacities within the covered 
entity's organization, and whether the Coordinator requirement 
obligates covered entities to hire a new employee to serve as a 
Coordinator, and if so, whether the job description must list all of 
the Coordinator responsibilities enumerated at Sec.  92.7(b).
    Response: Section 92.7(a) expressly states that a covered entity 
may assign one or more designees to assist the Coordinator in carrying 
out their responsibilities. However, the Coordinator must retain 
ultimate oversight for ensuring the covered entity's compliance with 
this part. In general, it is the covered entity's prerogative to 
designate any qualified individual to serve as its Coordinator. A 
covered entity does not need to hire a new employee for the role, and 
the Coordinator may serve in other capacities and have responsibilities 
in addition to their Coordinator responsibilities at Sec.  92.7(b); so 
long as those responsibilities do not create a conflict of interest or 
otherwise prevent the Coordinator from effectively carrying out their 
responsibilities.
    Comment: Some commenters recommended that OCR not require covered 
entities to list a Coordinator's name and contact information in their 
publicly available Notice of Nondiscrimination because of the constant 
need to update Coordinators'

[[Page 37552]]

names and contact information due to turnover and to avoid potential 
harassment from section 1557 opponents. Instead, these commenters 
requested that OCR allow covered entities to list the Section 1557 
Coordinator job title instead of an individual's name.
    Response: OCR appreciates the challenges associated with updating 
specific contact information; for this reason, nothing in Sec.  92.8 
(Policies and procedures) or Sec.  92.10 (Notice of nondiscrimination) 
require covered entities to include a Coordinator's name. As proposed, 
and finalized, Sec. Sec.  92.8(b) and 92.10(a)(1)(v) both require 
``contact information'' for the Coordinator; providing the job title 
rather than an individual's name is sufficient to meet this 
requirement. However, contact information in the form of a phone 
number, email address, and mailing address must also be provided. A 
covered entity may establish a general phone number, email address, 
and/or mailing address to meet this requirement. Absent this 
information, individuals who need to reach the Coordinator will have no 
knowledge of how to do so.
    While this rule does not apply to employment practices, as 
discussed in Sec.  92.2(b), employees of covered entities remain 
protected against retaliation as provided in Sec. Sec.  92.303 and 
92.304. If a covered entity's staff is harassing the Coordinator 
because of the Coordinator's job responsibilities, the covered entity 
should take appropriate measures to address the harassment, and, if the 
harassment is based on one or more characteristics protected by the 
Federal laws enforced by the EEOC, the Coordinator may file a charge of 
discrimination with the EEOC at https://www.eeoc.gov/filing-charge-discrimination.\70\ If staff, including a covered entity's Coordinator, 
are being threatened by other covered entity staff or by individuals 
external to the covered entity, we strongly encourage reporting these 
threats to the FBI at 1-800-225-5324 or via www.fbi.gov/tips.
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    \70\ The EEOC is responsible for enforcing Federal laws that 
make it illegal to discriminate against an employee because of the 
person's race, color, religion, sex (including pregnancy, childbirth 
or related medical conditions, gender identity, and sexual 
orientation), national origin, age (40 or older), disability or 
genetic information. See U.S. Equal Emp. Opportunity Comm'n, 
Overview, https://www.eeoc.gov/overview.
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    Comment: One commenter requested that OCR clarify whether a large 
health system made up of several covered entities can have a single 
Coordinator for the entire health system or whether each covered entity 
needs to have its own Coordinator. Another commenter stated that it is 
impossible for one Coordinator to oversee section 1557 compliance for 
an entire large health care system, with another suggesting that there 
should be at least one Coordinator for every 250 employees for covered 
entities with 500 or more employees.
    Response: In order to provide covered entities with flexibility, 
OCR clarifies that large health systems may customize their Coordinator 
and designee configurations as long as each individual covered entity 
has either a Coordinator or designee responsible for section 1557 
compliance. Because a covered entity is better positioned to determine 
how to ensure that the coordinator(s) can effectively perform all of 
their duties, we decline to revise the Coordinator requirement so that 
a covered entity is required to designate one Coordinator for every 250 
employees.
    Comment: A significant number of commenters recommended that all 
covered entities, regardless of size, have a Coordinator because 
ensuring section 1557 compliance is integral to providing 
nondiscriminatory health care services. Another commenter noted that 
the requirement aligns with the Joint Commission's recent standards 
requiring accredited hospitals and similar facilities to designate an 
individual to lead activities to reduce health disparities.
    Several commenters stated that the 15-employee threshold is 
arbitrary, arcane, and inconsistent with protecting civil rights to the 
maximum extent possible. Others stated the position is critical for 
smaller covered entities that provide services to individuals with 
disabilities, particularly in rural and low-income communities, and for 
covered entities that provide long-term services and supports to older 
adults and people with disabilities who use home and community-based 
services. Others referenced that smaller covered entities include 
mental health providers, social workers, psychologists, counselors, and 
family and marriage therapists.
    One commenter suggested that covered entities with fewer than 15 
employees could still voluntarily designate a Coordinator.
    Response: OCR appreciates comments received regarding the 
application of the Coordinator provision. While all covered entities, 
regardless of size, would benefit from having a dedicated Coordinator 
on staff, we decline to extend the requirement to all covered entities 
beyond those with 15 or more employees, in an effort to reduce 
unnecessary or counterproductive administrative obligations on small 
providers. OCR does not find this limitation to be arbitrary, as it is 
consistent with section 504's coordinator requirement, 45 CFR 84.7(a), 
and was also included in the 2016 Rule at former Sec.  92.7. We note 
that covered entities with fewer than 15 employees retain the option of 
designating a Coordinator.
    Comment: Other commenters thought the 15-employee threshold was 
appropriate, and that applying the requirement to smaller entities 
would result in burdens and costs for small and solo practices. Another 
commenter recommended increasing the employee threshold so that only 
covered entities with 50 or more employees be required to designate a 
Coordinator. Another commenter recommended that covered entities that 
fall within the Small Business Association's (SBA) classification \71\ 
of a small business not be required to designate a Coordinator. Another 
commenter recommended that the Coordinator requirement be removed 
altogether.
---------------------------------------------------------------------------

    \71\ U.S. Small Business Ass'n, Basic Requirements: Meet Size 
Standards, https://www.sba.gov/federal-contracting/contracting-guide/basic-requirements#section-header-6 (The SBA assigns a size 
standard to each NAICS code. Most manufacturing companies with 500 
employees or fewer, and most non-manufacturing businesses with 
average annual receipts under $7.5 million, will qualify as a small 
business.).
---------------------------------------------------------------------------

    Response: The Coordinator requirement is a vital step in 
encouraging proactive civil rights compliance; therefore, OCR declines 
to remove this provision. We also decline to increase the employee 
threshold for the Coordinator requirement to 50 or more employees. 
Though the coordinator requirement in title II of the ADA is limited to 
public entities with 50 or more employees, 28 CFR 35.107, the 15-
employee threshold in section 504 is more appropriate for section 1557. 
Section 504 covered entities are more analogous to section 1557 covered 
entities given that they are recipients of Federal financial assistance 
of all sizes; ADA title II covered entities, however, are all State or 
local governments. For similar reasons, we believe that that the SBA 
classification of a small business--which was set in a very different 
context serving very different purposes--is inappropriate for this 
rule.
    Comment: Some commenters requested additional clarity about the 15-
employee threshold. For example, commenters asked whether part-time, 
contractor, and sub-contractor employees would count toward a covered 
entity's employee total or if

[[Page 37553]]

only full-time employees would count. One commenter suggested that, 
without this clarification, some covered entities will engage in hiring 
and human resources practices that undermine and abuse the 15-employee 
threshold. Another commenter also sought to clarify whether only 
clinical staff should count toward the 15-employee threshold and 
whether administrative staff should count as well.
    Response: With respect to the employees who will count towards the 
15 or more-employee threshold, OCR will consider the total number of 
individuals employed by a covered entity. This includes full-time and 
part-time employees and independent contractors. All employees, 
regardless of job classification (e.g., clinical versus clerical), will 
count toward the threshold. We intend for this clarification to reduce 
concerns that the 15-employee threshold may lead to questionable 
employment practices.
    Comment: One commenter indicated that the Coordinator requirement 
implicates religiously affiliated covered entities' authority to hire 
people who share their religious beliefs because requiring religiously 
affiliated covered entities to have a Coordinator may compromise the 
religiously affiliated covered entity's religious beliefs if its 
Coordinator has fundamentally different beliefs or viewpoints.
    Response: Nothing in the regulatory text requires a covered entity 
to designate a Coordinator with a particular viewpoint or particular 
beliefs. No part of this final rule prevents a religiously affiliated 
recipient from designating or hiring an employee who shares the 
entity's religious beliefs as its Coordinator, provided that the 
individual is qualified to effectively and impartially perform the role 
required by the regulation. In addition, where title VII applies to a 
recipient's employment and hiring decisions, section 1557 does not 
interfere or otherwise conflict with requirements or protections 
afforded under title VII.
    Comment: Several commenters supported the 2022 NPRM's inclusion of 
an enumerated list of Coordinator responsibilities at Sec.  92.7(b). 
Many of these commenters appreciate the flexibility for covered 
entities to spread or delegate responsibilities to one or more 
designees within a covered entity's organization. Some commenters 
requested that OCR consider revising Sec.  92.7(b) to add an additional 
responsibility that Coordinators coordinate with other covered 
entities, as necessary, to ensure that individuals who are interacting 
with multiple entities receive the required language assistance 
services and/or auxiliary aids and services. A different commenter felt 
that the enumerated list of Coordinator responsibilities at Sec.  
92.7(b) is too prescriptive and recommended that OCR allow each covered 
entity the opportunity to determine their Coordinator's 
responsibilities.
    Response: The responsibilities enumerated at Sec.  92.7(b) provide 
a baseline for expected duties while allowing covered entities the 
flexibility, discretion, and ability to structure responsibility for 
such duties to their Coordinator(s) or designee(s). A covered entity 
may assign duties beyond those enumerated at Sec.  92.7(b), at its 
discretion.
    With respect to situations where two covered entities are 
interacting with the same individual with LEP, individual with a 
disability, or individual with a disability with LEP, both covered 
entities are responsible for ensuring that individuals receive the 
appropriate language assistance services and/or auxiliary aids and 
services required by this rule under Sec. Sec.  92.201 and 92.202. Some 
agencies may find that coordination between their Section 1557 
Coordinators will help to more effectively meet the needs of these 
individuals, but OCR declines to implement a requirement to this effect 
as each covered entity has an obligation under this part regardless of 
what services they believe another covered entity may be providing.
    Comment: Another commenter recommended that a covered entity's 
Coordinator not handle section 1557 grievances given that a covered 
entity may have an existing grievance collection point, which allows it 
to quickly address grievances through existing structures. A different 
commenter recommended that OCR clarify that a covered entity can assign 
Coordinator responsibilities to a group or division instead of one or 
more specific individuals because organizations may already have 
individuals specifically trained and responsible for ensuring 
nondiscrimination.
    Response: These regulations do not prohibit a Coordinator from 
working within existing organizational structures that receive and 
investigate grievances or perform other Coordinator responsibilities 
identified in Sec.  92.7(b). As discussed above, this provision 
provides a covered entity wide latitude to designate one or more 
Coordinator(s) and to assign one or more designee(s) to assist the 
Coordinator with their responsibilities, including collecting and 
addressing grievances. A covered entity may also assign Coordinator 
responsibilities to a group or division, provided that the covered 
entity identifies an individual Coordinator who retains ultimate 
oversight for coordinating section 1557 compliance.
    Comment: One commenter recommended that OCR make clear that, when 
performing their grievance responsibilities, the Coordinator is 
required to collect specific data, including: alleged basis or bases of 
discrimination; the date the grievance was filed; the date of the 
alleged discriminatory action; and the grievance resolution. This 
commenter indicated that this data should not include individually 
identifying information and indicated that the covered entity, through 
the Coordinator, should be responsible for the privacy of the data that 
they collect while fulfilling their coordinator role. A different 
commenter recommended that OCR require Coordinators to review grievance 
data in order to identify potential and actual discriminatory trends.
    Response: OCR appreciates the commenter's suggestion regarding the 
data that must be retained for each grievance. However, we decline to 
include these details here as the data points the commenter suggested 
are already in Sec.  92.8(c)(2), which discusses the information that 
must be retained in grievance records. Although this final rule does 
not require covered entities to collect data on trends across the 
organization, we highly encourage all Coordinators to review grievance 
data to identify and address any potential and actual discriminatory 
trends revealed in such data. We discuss this in greater detail at 
Sec.  92.8(c) (grievance procedure).
    Comment: Multiple commenters requested that OCR provide training 
and other resources to help covered entities implement the Coordinator 
requirement. Some commenters requested that OCR provide (1) training 
for people who are new to the Coordinator role and for providers who 
are updating the role; (2) facts sheets to introduce section 1557 to 
the Coordinator and other staff throughout the organization; and (3) 
checklists that can be consulted and used to confirm the Coordinator's 
responsibilities. One commenter requested that OCR training for 
Coordinators include civil rights, cultural, and implicit bias 
training.
    Response: OCR commits to serve as a resource and partner with 
covered entities that need help regarding their Coordinator 
obligations. As discussed in further detail at Sec.  92.8 (Policies and 
procedures), we plan to make various resources available to assist 
Coordinators with their responsibilities.
    Comment: One commenter asked how OCR will audit covered entities'

[[Page 37554]]

compliance with the Coordinator requirement and whether the Coordinator 
post will be eligible for the Federal matching rate as an 
administrative activity under section 1903(a)(7) of the Social Security 
Act.
    Response: Consistent with current practice, OCR will determine a 
covered entity's compliance with the Coordinator requirement during 
complaint investigations and affirmative compliance reviews. With 
regard to the commenter's inquiry regarding the availability of Federal 
financial participation under section 1903(a)(7) of the Social Security 
Act, 42 U.S.C. 1396b(a)(7), OCR does not administer Medicaid and 
therefore this comment is outside of the scope of this rulemaking.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.7, without modification.
Policies and Procedures (Sec.  92.8)
    At Sec.  92.8 of the 2022 NPRM, OCR proposed requiring covered 
entities to develop and implement written policies and procedures that 
are designed to facilitate compliance with the requirements of the 
part. We proposed requiring each covered entity, in its health programs 
and activities, to adopt and implement a nondiscrimination policy, 
grievance procedures (for covered entities employing 15 or more 
persons), language access procedures, auxiliary aids and services 
procedures, and procedures for reasonable modifications for individuals 
with disabilities (collectively, ``Section 1557 Policies and 
Procedures'').
    In Sec.  92.8(a), we proposed a general requirement for covered 
entities to implement written Section 1557 Policies and Procedures. The 
policies and procedures must include an effective date and be 
reasonably designed, taking into account the size, complexity, and the 
type of health programs or activities undertaken by a covered entity, 
to ensure compliance with the part.
    In Sec.  92.8(b), we proposed requiring each covered entity to 
implement a written nondiscrimination policy that, at minimum, provides 
the contact information for the Section 1557 Coordinator (if 
applicable) and states that the covered entity in its health programs 
and activities: is prohibited from unlawfully discriminating on the 
basis of race, color, national origin (including limited English 
proficiency and primary language), sex (including pregnancy, sexual 
orientation, gender identity, and sex characteristics), age, or 
disability; and provides language assistance services and appropriate 
auxiliary aids and services free of charge, when necessary for 
compliance with section 1557 or the part.
    In Sec.  92.8(c), we proposed addressing the requirements for 
covered entities with 15 or more employees with regard to grievance 
procedures and recordkeeping in their health programs and activities, 
including ensuring that the grievance procedure is accessible to 
individuals with LEP and individuals with disabilities.
    In Sec.  92.8(c)(1), we proposed requiring that covered entities 
with 15 or more employees establish written civil rights grievance 
procedures.
    In Sec.  92.8(c)(2), we proposed that a covered entity must retain 
records related to grievances filed with it that allege discrimination 
on the basis of race, color, national origin, sex, age, or disability 
in its health programs and activities for no less than three (3) years 
from the date of the filing of the grievance.
    In Sec.  92.8(c)(3), we proposed that a covered entity keep 
confidential the identity of an individual who has filed a grievance, 
except as required by law or to the extent necessary to carry out the 
purposes of this proposed regulation, including the conduct of any 
investigation.
    We invited comment on the record retention requirement, 
particularly with regard to patient privacy concerns or concerns 
regarding potentially unauthorized use of information included in such 
records. We also sought comment on best practices for record retention 
of grievance procedures, including strategies for ensuring patient 
privacy.
    In Sec.  92.8(d), we proposed requiring covered entities to develop 
and implement written language access procedures to support compliance 
with requirements to take reasonable steps to provide meaningful access 
to individuals with LEP in their health programs and activities under 
proposed Sec.  92.201.
    In Sec.  92.8(e), we proposed requiring covered entities to develop 
and implement written effective communication procedures to support 
compliance with requirements to take appropriate steps to ensure that 
communications in their health programs and activities with individuals 
with disabilities are as effective as communications with individuals 
without disabilities under proposed Sec.  92.202.
    In Sec.  92.8(f), we proposed requiring covered entities to develop 
and implement written procedures for making reasonable modifications to 
their policies, practices, or procedures that allow individuals with 
disabilities equal opportunity to participate in their health programs 
and activities as required under proposed Sec.  92.205.
    In Sec.  92.8(g), we proposed that a covered entity may combine the 
content of the policies and procedures required by this provision with 
any policies and procedures pursuant to other civil rights statutory 
protections if they clearly comply with section 1557 and the provisions 
in the part.
    We sought comment on this proposed provision and whether there may 
be alternative measures that OCR should consider to proactively prevent 
discrimination, and whether they would be more or less burdensome than 
what was proposed. We also invited comment from all covered entities 
that had previously implemented or were currently implementing any of 
the proposed procedures; consumers who interact with covered health 
programs and activities; and community-based organizations that work 
with individuals with LEP and individuals with disabilities. We also 
requested comment on whether covered entities employing fewer than 15 
people should be required to have a grievance procedure, including the 
benefits of a less formal resolution process.
    The comments and our responses regarding Sec.  92.8 are set forth 
below.
General Comments
    Comment: Many commenters expressed support for the Section 1557 
Policies and Procedures requirement at Sec.  92.8, noting that, in 
their view, it will help prevent discrimination and health disparities; 
requires providers to proactively engage in the process of avoiding 
discrimination; elevates covered entities and their employees' 
knowledge about their section 1557 obligations; and alleviates the 
burden on patients to file complaints in order to trigger section 1557 
compliance and enforcement. Some commenters supported the requirement 
because the 2020 Rule leaves requirements for policies and procedures 
disjointed, confusing, and ineffective.
    Some commenters recommended that OCR strengthen this requirement by 
requiring covered entities to evaluate the effectiveness of their 
Section 1557 Policies and Procedures and update them when necessary to 
ensure consistency.
    Response: Covered entities' Section 1557 Policies and Procedures 
should be dynamic and updated to ensure covered entities comply with 
changes in the law

[[Page 37555]]

and meet their section 1557 obligations. In addition, when covered 
entities' operations change, this may necessitate revising Section 1557 
Policies and Procedures to maintain section 1557 compliance.
    Accordingly, we have added Sec.  92.8(h) to address when it is 
required and permissible for a covered entity to revise their Section 
1557 Policies and Procedures. Section 92.8(h)(1) explains that a 
covered entity must review and revise its policies and procedures, as 
necessary, to ensure they are current and in compliance with section 
1557 and this rule. Section 92.8(h)(2) states that a covered entity may 
change its policies and procedures at any time, provided that the 
changed policies comply with section 1557 and the part.
    Comment: Some commenters who opposed this requirement cited covered 
entities' existing compliance burdens and the resources needed to draft 
Section 1557 Policies and Procedures. Some commenters requested that, 
if OCR maintains the requirement in the final rule, OCR make template 
Section 1557 Policies and Procedures available for covered entities to 
use and tailor to their organizations as far in advance of the final 
rule's effective date as possible.
    One commenter stated that existing Federal and State regulations 
prevent covered entities from focusing on high-quality care, and that 
this requirement is an unfunded mandate. One commenter recommended that 
OCR should continue previously permitted flexibility and allow covered 
entities to develop Section 1557 Policies and Procedures voluntarily.
    Response: To assist covered entities' compliance with this 
requirement, OCR has developed Section 1557 Policies and Procedures 
templates that are available on OCR's website at www.hhs.gov/1557, 
which are designed to assist covered entities in tailoring their own 
Section 1557 Policies and Procedures. We reiterate the requirement that 
a covered entity's Section 1557 Policies and Procedures must be 
reasonably designed, take into account a covered entity's size, 
complexity, and the type of health programs or activities provided. A 
covered entity should view these templates as a starting point for 
adopting and implementing Section 1557 Policies and Procedures that are 
specific to their health programs and activities. The templates 
provided may be insufficient for large covered entities given the range 
in complexity and structure of those entities, and entities must ensure 
that their Section 1557 Policies and Procedures reflect the appropriate 
scope.
    Comment: Some commenters recommended that OCR not require covered 
entities to identify the names of their respective Coordinators in 
their Section 1557 Policies and Procedures required by Sec.  92.8(b), 
(d), (e), and (f) because high employee turnover may make coordinators' 
names obsolete and require constant changes.
    Response: OCR notes that nothing in Sec.  92.8 requires a covered 
entity to identify the Coordinator by name; rather, Sec.  92.8(b), (d), 
(e), and (f) require the Coordinator's current contact information. The 
referenced provisions require sufficient information for an individual 
who needs assistance in implementing the procedures to reach the 
Coordinator. Thus, a covered entity could choose to list the position 
title with a phone number, email address, and mailing address.
    Comment: One commenter requested that OCR clarify, especially with 
respect to large health systems (such as hospitals, clinics, home care 
entities, and home medical equipment retail settings), the regulatory 
language related to scalability.
    Response: OCR recognizes that covered entities--including not only 
recipients, but also the Department and title I entities--need 
flexibility when developing and implementing their Section 1557 
Policies and Procedures. A covered entity should consider its size, 
capabilities, the costs of specific measures, the operational impact, 
and the composition of the patient populations they serve in deciding 
the appropriate scale of their Section 1557 Policies and Procedures. 
Thus, OCR expects the scope and detail of a covered entity's Section 
1557 Policies and Procedures to vary accordingly.
    Comment: Some commenters requested that OCR include additional 
required policies and procedures, such as policies and procedures 
regarding service animals, protecting civil rights in public health 
emergencies, assessing the competency of bilingual/multilingual staff, 
and telehealth. Specifically, one commenter recommended requiring a 
telehealth procedure designed to assist covered entity employees 
communicate with patients before, during, and after telehealth visits, 
and that this telehealth procedure could address pre-appointment 
telehealth screenings to ensure that patients have the necessary 
equipment or technology for their appointments and to determine whether 
the patient has the requisite technological skills to participate in a 
telehealth session. The proposed telehealth procedure would require 
covered entities to provide telehealth training resources for patients 
who lack skills or familiarity with telehealth prior to their 
appointments. Other commenters recommended that covered entities' 
procedures ensure accessibility for individuals with physical and/or 
behavioral health disabilities and specifically comply with the U.S. 
Access Board's Standards for Accessible Medical Diagnostic Equipment. 
82 FR 2810 (Jan. 9, 2017).
    Response: OCR recognizes the benefit of policies and procedures to 
support civil rights compliance. However, we recognize that developing 
and implementing such policies and procedures is not without an initial 
burden on the covered entities, and the continued--though much 
diminished--effort of maintaining the procedures and employee 
familiarity with such procedures. For that reason, we decline to 
require additional policies and procedures at this time. However, 
covered entities are encouraged to develop and implement policies and 
procedures related to service animals, protecting civil rights during 
public health emergencies, assessing bilingual and multilingual staff 
members' competency, nondiscriminatory provision of telehealth,\72\ 
accessible medical equipment, or any other situation they choose in 
order to ensure compliance with section 1557. For more about section 
1557's accessibility requirements, please refer to our discussion for 
Sec.  92.204, which requires covered entities to make their buildings 
and facilities accessible to individuals with disabilities. In 
addition, please see the discussion of medical diagnostic equipment 
under Sec.  92.207. Please also see the discussion of Sec.  92.211 
related to nondiscrimination in the delivery of health programs and 
activities through telehealth services.
---------------------------------------------------------------------------

    \72\ See, e.g., U.S. Dep't of Health & Hum. Servs., Off. for 
Civil Rts.; U.S. Dep't of Justice, Civil Rts. Div., Guidance on 
Nondiscrimination in Telehealth: Federal Protections to Ensure 
Accessibility to People with Disabilities and Limited English 
Proficient Persons, https://www.hhs.gov/sites/default/files/guidance-on-nondiscrimination-in-telehealth.pdf.
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Summary of UUegulatory changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the policies and procedures 
requirement provision at Sec.  92.8 as proposed, with modifications. We 
have added a paragraph (h) that explains that a covered entity must 
review and revise its policies and procedures, as necessary, to ensure 
they are current and in compliance with section 1557 and this rule and 
that a covered entity

[[Page 37556]]

may change its policies and procedures at any time, provided that the 
changed policies comply with section 1557 and this rule.
Nondiscrimination Policy
    Comment: Many commenters supported the Nondiscrimination Policy at 
proposed Sec.  92.8(b). Some commenters recommended that OCR revise the 
language in this Policy so that the description of prohibited sex 
discrimination is consistent with the description of sex discrimination 
included in Sec.  92.101 (i.e., revise to include sex stereotypes and 
pregnancy or related conditions). Some of these commenters further 
recommended that OCR also specify that ``pregnancy or related 
conditions'' includes termination of pregnancy. Other commenters 
requested that OCR further revise Sec.  92.8(b)'s reference to sex 
discrimination and make a corresponding revision to Sec.  92.101(a)(2) 
by adding ``transgender status'' to the description of sex 
discrimination for both provisions.
    Response: OCR appreciates the need for consistency across the 
regulation, and to ensure that the public is aware of the various types 
of discrimination included under the umbrella of sex discrimination. We 
clarify that a Nondiscrimination Policy's prohibition of sex 
discrimination encompasses protections afforded for various types of 
sex discrimination such as pregnancy, including termination of 
pregnancy or related conditions, and we have revised the parenthetical 
in Sec.  92.8(b) to explain that this provision's reference to sex 
discrimination is consistent with the various types of sex 
discrimination described at Sec.  92.101(a)(2), which includes ``gender 
identity.'' We decline to add ``transgender status'' to the regulatory 
text, as the term ``gender identity'' necessarily encompasses 
``transgender status'' and these terms are often used 
interchangeably.\73\
---------------------------------------------------------------------------

    \73\ See, e.g., Bostock v. Clayton Cnty., Georgia, 590 U.S. 644, 
658-59 (2020); Doe v. Mass. Dep't of Correction, No. CV 17-12255-
RGS, 2018 WL 2994403 (D. Mass. June 14, 2018); Whitaker v. Kenosha 
Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034 (7th Cir. 
2017).
---------------------------------------------------------------------------

    At the same time, we want to emphasize that the ACA itself provides 
that ``[n]othing in this Act shall be construed to have any effect on 
Federal laws regarding--(i) conscience protection; (ii) willingness or 
refusal to provide abortion; and (iii) discrimination on the basis of 
the willingness or refusal to provide, pay for, cover, or refer for 
abortion or to provide or participate in training to provide 
abortion.'' 42 U.S.C. 18023(c)(2)(A). HHS will comply with this 
provision.\74\ For further discussion regarding what constitutes sex 
discrimination, including the application of religious freedom and 
conscience protections in this context, please see the discussion at 
Sec.  92.101(a)(2).
---------------------------------------------------------------------------

    \74\ The application of this final rule to covered entities with 
religious freedom or conscience objections is discussed more fully 
below in Sec. Sec.  92.3 (Relationship to other laws) and 92.302 
(Notification of views regarding application of Federal religious 
freedom and conscience laws).
---------------------------------------------------------------------------

    Comment: One commenter expressed opposition to Sec.  92.8(b) 
because it would increase paperwork without benefiting or improving the 
quality of care.
    Response: As we noted above, many commenters, some of which are 
providers and professional medical associations, support the 
requirement to have a Nondiscrimination Policy. Peer-reviewed medical 
publications acknowledge that a health care organization's written 
policies and procedures can improve quality of care and mitigate the 
legal risk of causing patient harm.\75\ Indeed, research suggests that 
the mere existence of policies that prohibit discrimination helps 
reduce health and other inequities.\76\ Thus, we disagree with the 
commenter's contention that Sec.  92.8(b) increases paperwork without 
benefitting or improving quality of care particularly for individuals 
who belong to communities with a history of experiencing discrimination 
in health care settings.
---------------------------------------------------------------------------

    \75\ See James O'Donnell et al., Policies and Procedures: 
Enhancing Pharmacy Practice and Limiting Risk, 37 Health Care & L. 
341 (2012), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3411206/; 
Savithiri Ratnapalan et al., Organizational Learning in Health Care 
Organizations, 2 Systems 24-33 (2014), https://www.mdpi.com/2079-8954/2/1/24.
    \76\ See generally Douglas Almond & Kenneth Chay, Civil Rights, 
The War on Poverty, and Black-White Convergence in Infant Mortality 
in the Rural South and Mississippi, Mass. Inst. of Tech., Dep't of 
Economics, Working Paper Series, SSRN, (2007), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=961021; Doughlas Almond 
& Kenneth Chay, The Long-Run and Intergenerational Impact of Poor 
Infant Health: Evidence from Cohorts Born During the Civil Rights 
Era, Nat'l Bureau of Econ. Rsch (2006), https://users.nber.org/
~almond/chay_npc_paper.pdf; Nancy Krieger et al., The Unique Impact 
of Abolition of Jim Crow Laws on Reducing Inequities in Infant Death 
Rates and Implications for Choice of Comparison Groups in Analyzing 
Societal Determinants of Health, 103 a.m. J. of Pub. Health, 2234 
(2013), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3828968/; John 
J. Donahue III & James Heckman, Continuous Versus Episodic Change: 
The Impact of Civil Rights Policy on the Economic Status of Blacks, 
NBER Working Papers Series, SSRN, (2007), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=474003; David Card & Alan Krueger, 
Trends in Relative Black-White Earnings Revisited, 83 The Am. Econ. 
Rev. 85-91 (1993), https://www.jstor.org/stable/
2117645#:~:text=For%20both%20of%20these%20cohorts,1939%20cohort%20is%
20especially%20noteworthy.
---------------------------------------------------------------------------

    Comment: A few commenters expressed First Amendment concerns 
related to the overarching Section 1557 Policies and Procedures 
requirement, particularly the Nondiscrimination Policy requirement. One 
of these commenters recommended that, with respect to the Section 1557 
Policy and Procedures requirement, OCR should clarify that covered 
entities retain free speech protections to the extent that sex 
discrimination does not result if a covered entity acknowledges a 
patient's sex assigned at birth. An organizational commenter stated 
that the Nondiscrimination Policy is problematic under the First 
Amendment because requiring a covered entity to state that it does not 
discriminate on the bases of pregnancy, sexual orientation, gender 
identity, and sex characteristics constrains freedom of speech and 
freedom of association.
    Response: OCR acknowledges the comments regarding protections on 
the basis of sex, particularly as they relate to nondiscrimination on 
the basis of pregnancy or related conditions, sexual orientation, and 
gender identity. As noted above, we have revised Sec.  92.8(b) by 
removing descriptions of sex discrimination and by cross-referencing 
Sec.  92.101(a)(2) and that provision's description of sex 
discrimination. Thus, a covered entity's Nondiscrimination Policy need 
not explicitly include the various forms of prohibited sex 
discrimination to address any potential First Amendment concern. 
However, we emphasize that these concerns do not negate a covered 
entity's obligation to implement Section 1557 Policies and Procedures.
    We also note here that we have amended the regulatory text to add, 
as a best practice towards compliance, that a recipient's 
Nondiscrimination Policy reflect assurance of exemptions that have been 
triggered or that have been granted to that recipient under Sec.  
92.302.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the Nondiscrimination Policy 
requirement at Sec.  92.8(b) as proposed, with modifications. We are 
revising Sec.  92.8(b)(1) to adjust the explanatory parenthetical for 
sex in the Nondiscrimination Policy to state ``consistent with the 
scope of sex discrimination described at Sec.  92.101(a)(2).'' We are 
revising Sec.  92.8(b) to add paragraph (b)(2) that states, ``OCR 
considers it a best practice toward achieving compliance for a covered

[[Page 37557]]

entity to provide information that it has been granted a temporary 
exemption or granted an assurance of exemption under Sec.  92.302(b) in 
the nondiscrimination policy required by paragraph (b)(1) of this 
section.''
Grievance Procedures
    Comment: In general, commenters supported the grievance procedures 
requirement at Sec.  92.8(c), including because allowing patients to 
voice concerns to providers builds trust between patients and 
providers.
    Response: OCR's enforcement experience reveals that grievance 
procedures help covered entities lower compliance costs and provide 
covered entities the opportunity to resolve grievances--through direct 
communication with the individual raising the grievance--in the 
quickest possible manner without OCR's involvement.
    Comment: Some commenters recommended that OCR require covered 
entities to adjudicate grievances quickly, and some of these commenters 
specifically requested that OCR add timeframes by which section 1557 
grievances must be both acknowledged and resolved because covered 
entities may either belatedly or never acknowledge a complaint or take 
longer than perceived as necessary to resolve grievances. Others 
requested that OCR define ``prompt and equitable'' resolution, with one 
stating that ``equitable'' is a subjective construct and suggested that 
OCR consider requiring covered entities to resolve grievances by 
affording the aggrieved individual appropriate access to the health 
program or activity at issue. Relatedly, another commenter asked that 
OCR consider differentiating between pretreatment grievances and other 
grievances, because denials of care and coverage can result in the 
postponement or foregoing of care altogether and can require patients 
to wait for the resolution of a grievance before seeking care from an 
alternate provider.
    Response: We appreciate these commenters' desire for additional 
specificity regarding what is meant by ``prompt and equitable'' 
resolution of a grievance. This terminology is consistent with 
grievance procedures requirements found in the Department's section 504 
and title IX regulations at 45 CFR 84.7(b) and 86.8(b), respectively.
    Imposing a single timeframe by which a covered entity must resolve 
a grievance does not account for the fact that covered entities vary in 
size, resources, and capabilities, and so one timeframe may not be 
appropriate for all entities. Multiple factors may impact the length of 
time required to evaluate and resolve a particular grievance and to 
ensure a fair process and reliable outcome, including the nature of the 
grievance. This is balanced by the fact that prompt resolution of 
complaints is necessary to further section 1557's nondiscrimination 
objective. We encourage individuals to file complaints with OCR if they 
have filed a grievance that they do not believe has been resolved in a 
prompt and equitable manner. OCR's investigation of such a complaint 
may determine whether a covered entity's grievances procedures truly 
provide for prompt and equitable resolutions, and if they do not, OCR 
may seek corrective actions from the covered entity. For these reasons, 
we decline to add timeframes within which covered entities are required 
to address grievances, and we decline to define the term ``prompt and 
equitable.''
    Comment: Some commenters recommended that OCR require covered 
entities to notify individuals of the ability to file a grievance. 
Other commenters requested that OCR revise Sec.  92.8(c) to require a 
covered entity's process for filing grievances be simple, not 
burdensome, and accessible to individuals with LEP and individuals with 
disabilities.
    Response: To the extent covered entities are required to have 
grievance procedures, covered entities are also required to include 
information about the availability of their grievance procedures and 
how to file a grievance in their Notice of Nondiscrimination, per Sec.  
92.10(a)(1)(vi). All covered entities, regardless of size, must also 
include information in the Notice of Nondiscrimination on how to file a 
discrimination complaint with OCR, per Sec.  92.10(a)(1)(vii).
    In addition, the grievance process must be accessible to 
individuals with LEP and individuals with disabilities, consistent with 
section 1557 and this regulation. If an individual finds that a covered 
entity's grievance process is generally overly burdensome to the point 
it is ineffective or nonexistent and thus hindering the prompt and 
equitable resolution of grievances, we recommend the individual file a 
complaint with OCR.
    Comment: Many commenters on this provision recommended that OCR 
require all covered entities (not just those with 15 or more employees) 
to have grievance procedures, while others either requested that OCR 
maintain the 15-employee threshold or eliminate the requirement 
altogether.
    Commenters in support of eliminating the 15-employee threshold 
contended that a covered entity's size does not protect patients from 
discrimination and the threshold is inequitable because it deprives 
patients of smaller covered entities the opportunity to directly engage 
with the covered entity to address alleged discrimination. According to 
commenters, individuals with disabilities face significant barriers to 
care when seeking and receiving services from smaller covered entities, 
and the 15-employee threshold unjustly deprives individuals with 
disabilities of the opportunity to address these barriers through 
grievances.
    Further, commenters remarked that regulatory carve outs and 
distinctions are confusing and difficult for both covered entities and 
patients when determining applicable requirements and protections. 
Commenters expressed concern that individuals from marginalized 
communities would be confused about why they could not submit a 
grievance with a covered entity with fewer than 15 employees simply due 
to the size of the covered entity, when other requirements in the rule 
apply regardless of covered entity size.
    Commenters also raised the following issues countering inclusion of 
a 15-employee threshold: the statutory text of section 1557 is not so 
limited; the limitation is inconsistent with expanding section 1557's 
application; an individual should have the ability to address 
discrimination in the first instance directly to the covered entity; 
and a covered entity with fewer than 15 employees that has grievance 
procedures will be able to resolve discrimination complaints more 
promptly at an earlier stage without formal OCR investigation.
    Citing the burden on smaller covered entities, some commenters 
requested that OCR maintain the grievance procedures requirement only 
for covered entities with at least 15 employees, eliminate the 
procedures altogether or utilize the SBA's definition of small 
business.
    Response: We appreciate commenters' concerns about the 15-employee 
threshold and recognize that individuals are not immune from 
experiencing discrimination when interacting with smaller covered 
entities. However, OCR declines to apply this requirement to all 
covered entities and note that this approach is consistent with OCR's 
section 504 regulation, which similarly limits the grievance procedure 
requirement. See 45 CFR 84.7(a). Individuals remain able to file 
complaints with OCR when they experience discrimination in health 
programs and activities and may also raise concerns to smaller covered

[[Page 37558]]

entities outside of a formal grievance process.
    Given the benefits of having grievance procedures, we encourage 
smaller covered entities to voluntarily implement such procedures, 
which may help them more meaningfully engage with all individuals, 
including members of underserved communities, and better identify 
potential barriers to accessing their health programs and activities.
    Comment: Some commenters pointed to the Health Insurance 
Portability and Accountability Act of 1996 (HIPAA) as precedent and 
demonstrable evidence that the Department believes providers of all 
sizes have the ability to comply with a Federal requirement to 
implement a process for handling complaints. These commenters suggested 
that all HIPAA-covered entities, including those with fewer than 15 
employees, have experience implementing a process for receiving, 
handling, and investigating privacy complaints, which these covered 
entities can modify or replicate, if necessary, to include section 1557 
discrimination grievances.
    Response: OCR appreciates commenters' observation that HIPAA-
covered entities of all sizes have experience implementing a complaint 
process. However, we are unpersuaded that the potential burden to 
smaller covered entities with existing HIPAA complaint processes would 
be minimal because these entities would need to revise their existing 
policies, train relevant staff, and process civil rights-related 
grievances in addition to processing HIPAA-related complaints. This is 
similar to our position in response to comments received in response to 
the 2015 NPRM. 81 FR 31395. Nothing in this rule prohibits entities of 
fewer than 15 employees from voluntarily creating a grievance process.
    Comment: In support of requiring all covered entities to have 
grievance procedures, commenters suggested that covered entities could 
have less extensive or detailed grievance procedures, and that such a 
procedure would not need to involve significant staff or resources. 
These commenters recommended that OCR develop model grievance 
procedures for smaller covered entities to help them comply with the 
grievance procedures requirement.
    Response: To assist all covered entities--including those with 
fewer than 15 employees that may wish to voluntarily implement a 
grievance procedure--we have made available sample grievance procedures 
on OCR's website at www.hhs.gov/1557. We note that the sample grievance 
procedure available on OCR's website is more appropriate for smaller 
covered entities, and we remind covered entities that the rule's 
general Section 1557 Policies and Procedures requirement is founded on 
the principle of scalability. Accordingly, the sample grievance 
procedure on our website may not be adequate for a larger covered 
entity or health system made up of several covered entities.
    Comment: Many commenters supported the record retention requirement 
at Sec.  92.8(c)(2). Under this provision, we proposed that covered 
entities must retain records for a minimum of three (3) calendar years, 
and each record must include the name and contact information of the 
complainant, the alleged discriminatory action and alleged basis or 
bases of discrimination, the date the grievance was filed, the 
grievance resolution, and any pertinent information.
    Some commenters expressed that this requirement will help covered 
entities identify potential patterns and practices of discrimination of 
which they may not have otherwise been aware. Other commenters who 
supported this requirement expressed concern about patient privacy and 
recommended that OCR require covered entities to deidentify information 
related to the grievance during the retention period.
    Response: We appreciate commenters' support for this new provision 
and recognize the importance of ensuring patient privacy related to 
recordkeeping. Section 92.8(c)(3) requires covered entities to keep 
confidential the identity of the individual who submits a grievance, 
subject to limited exceptions. We decline to revise the records 
retention requirement to require covered entities to deidentify that 
information related to the grievance.
    Many section 1557 covered entities must also comply with the HIPAA 
Privacy and Security Rules, which requires HIPAA covered entities to 
protect and secure all protected health information that a covered 
entity or business associate creates, receives, maintains, or 
transmits. If a covered entity discloses an individual's protected 
health information in violation of the HIPAA Rules, then the covered 
entity is subject to OCR's HIPAA enforcement measures.\77\ If a section 
1557 covered entity maintains grievance records beyond three (3) 
calendar years, the covered entity may deidentify the information after 
the records retention period has elapsed. Even where a section 1557 
covered entity is not subject to HIPAA, that section 1557 entity must 
still comply with all applicable Federal and State privacy laws.
---------------------------------------------------------------------------

    \77\ See 45 CFR 160.312 and 160.400 through 160.414.
---------------------------------------------------------------------------

    Comment: One commenter requested that OCR revise Sec.  92.8(c)(2) 
so that a covered entity be required to retain only ``actionable'' 
grievances because large, covered entities may receive grievances that 
are not related to section 1557's protections. This commenter gave an 
example that a complaint may be employment-related, and therefore Sec.  
92.8(c)(2) should not require a covered entity to retain such a 
grievance.
    Another commenter raised a similar concern and recommended that OCR 
completely eliminate any record retention requirement as they relate to 
grievances because it is difficult to know when a grievance triggers 
the retention requirement. This commenter requested that, if OCR 
retains the grievance records retention requirement, that it only apply 
to covered entities with 15 or more employees.
    Response: Section 92.8(c)(2) applies only to covered entities that 
are required to have grievance procedures (i.e., those with 15 or more 
employees), and this provision expressly specifies that covered 
entities retain grievances it receives pursuant to the grievance 
procedures requirement at Sec.  92.8(c)(1) that allege discrimination 
on the basis of race, color, national origin, sex, age, or disability 
in the covered entity's health programs or activities. Thus, covered 
entities need not retain records pertaining to employment-related 
grievances or grievances that do not allege discrimination based on 
race, color, national origin, sex, age, or disability in the covered 
entity's health programs or activities. If a covered entity cannot 
determine whether a complaint relates to section 1557, the covered 
entity should contact the complainant to obtain sufficient information 
to either investigate the grievance or determine if the complaint 
should be handled under a different process. We note that a covered 
entity's dismissal of a grievance constitutes its resolution of the 
grievance.
    Comment: One commenter who expressed support for the retention 
requirement opined that the proposed three-year retention period is 
less burdensome than the seven-year retention requirement applicable to 
most records for hospice and palliative care. Another commenter 
recommended that covered entities be required to retain grievance-
related records permanently due to the low costs associated with 
maintaining these records electronically, and a covered entity could 
find older records useful in

[[Page 37559]]

litigation. Another commenter recommended that OCR adopt a four-year 
retention period to match section 1557's four-year statute of 
limitations \78\ because a retention period shorter than section 1557's 
statute of limitations would prevent private litigants from obtaining 
grievance-related evidence relevant to a section 1557 claim. One 
commenter also recommended that OCR revise Sec.  92.8(c)(2) so that the 
timeframe for covered entities to retain grievance records starts once 
the covered entity resolves the grievance rather than when the covered 
entity receives it.
---------------------------------------------------------------------------

    \78\ See, e.g., Tomei v. Parkwest Med. Ctr., 24 F.4th 508, 515 
(6th Cir. 2022) (holding the catchall Federal statute of limitations 
at 28 U.S.C. 1658(a) applies to claims under section 1557 because 
section 1557 lacks an express statute of limitations); but see Solis 
v. Our Lady of the Lake Ascension Cmty. Hosp., Inc., No. CV 18-56-
SDD-RLB, 2020 WL 2754917, at *4 (M.D. La. May 27, 2020) (applying 
the Rehabilitation Act statute of limitations to a section 1557 
claim of disability discrimination).
---------------------------------------------------------------------------

    Response: OCR has determined that the three-year record retention 
requirement strikes the appropriate balance between covered entities' 
burden concerns and the need for OCR to access this vital information 
in the course of a complaint investigation or compliance review. As 
stated in the 2022 NPRM, we understand that many covered entities 
already have a practice of retaining grievance records, and nothing in 
this rule prevents a covered entity from retaining records longer if 
they so choose. 87 FR 47849.
    We appreciate commenters' recommendation that OCR specify that the 
retention obligation starts on the date that the covered entity 
resolves the grievance rather than on the date that the complainant 
filed the grievance, and we are revising Sec.  92.8(c)(2) to reflect 
this change. Grievances take varying amounts of time to resolve, and 
starting the retention obligation on the date of receipt could 
potentially result in a covered entity disposing of records pertaining 
to a grievance prior to the resolution of the grievance. This change 
necessitates that we further revise Sec.  92.8(c)(2) to require a 
covered entity's grievance records also include the date that the 
covered entity resolved a grievance.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the Grievance Procedure 
requirement provision at Sec.  92.8(c) as proposed, with modifications. 
We are revising Sec.  92.8(c)(2) to explain that the grievances that a 
covered entity must retain are those filed pursuant to its grievance 
procedures required by Sec.  92.8(c)(1) that allege discrimination 
based on race, color, national origin, sex, age, and disability in a 
covered entity's health programs or activities, and that the records 
include the date the grievance was resolved. We are also clarifying at 
Sec.  92.8(c)(2) that the retention period for grievance procedures 
starts on the date the covered entity resolves the grievance.
Language Access Procedures
    Comment: Most commenters on this provision expressed support for 
the proposed language access procedures requirement at proposed Sec.  
92.8(d). Some commenters recommended that OCR revise Sec.  92.8(d) to 
make clear that a covered entity's language access obligations extend 
to companions of patients, beneficiaries, enrollees, and applicants.
    Response: It has been OCR's practice to require covered entities to 
provide language assistance services for LEP companions of patients, 
beneficiaries, enrollees, and applicants when necessary. Rather than 
revising Sec.  92.8(d), we are revising Sec.  92.201 (Meaningful access 
for individuals with LEP) to codify this requirement. We discuss this 
further when addressing comments related to Sec.  92.201. Because the 
language access procedures are intended to assist covered entities in 
complying with their language access obligations under Sec.  92.201, 
they should ensure that companions are included.
    Comment: One commenter recommended that OCR allow covered entities 
the flexibility to identify the process and business rules that they 
currently use to identify individuals with LEP, how to provide language 
assistance services, and how to create and store translated materials 
and resources. This commenter suggested that Sec.  92.8(d) reads as if 
it is intended for smaller covered entities that provide language 
assistance services in an ad hoc manner.
    Response: Section 92.8(d) applies to covered entities of all sizes, 
allowing flexibility for covered entities to scale their language 
assistance services procedures as needed. Section 92.8(d) does not 
restrict the manner in which a covered entity implements its language 
access procedures, which may include the use of pre-existing business 
tools that meet the necessary requirements. For example, Sec.  92.8(d) 
does not dictate how covered entities' employees identify individuals 
with LEP or how covered entities obtain language assistance services 
from qualified interpreters and translators (i.e., through contract 
interpreters, in-house interpreters, etc.).
    Comment: Some commenters indicated that often patients with LEP 
have to repeat a language access intake process with every visit to a 
covered entity, even when they have already gone through such a process 
and their language access needs have been previously identified by the 
covered entity. To avoid this situation, commenters recommended that 
OCR require covered entities to note in a patient's records whether the 
patient needs language assistance services, and if so, the specific 
language and services needed.
    Response: OCR understands that repeatedly having to request 
necessary language assistance services from the same covered entity can 
be frustrating and may result in wasted time or the cancellation of an 
appointment if the needed services are unavailable. While the 
commenters' suggestion for covered entities to document the specific 
language assistance services needs in the patient with LEP's record is 
a best practice that we encourage for inclusion in a covered entities' 
language access procedures, OCR declines to revise Sec.  92.8(d). As 
drafted, the provision allows covered entities the flexibility needed 
to comply.
    Comment: Some commenters requested that OCR revise Sec.  92.8(d) 
with text: (1) directly from Sec.  92.201 related to covered entities' 
obligation to provide each individual with LEP with meaningful access; 
and (2) that aligns with Executive Order 13166 (``Improving Access to 
Services for Persons with Limited English Proficiency''); \79\ title 
VI; Medicaid's commitment to enhancing access through culturally 
competent care as defined in 42 CFR 440.262; and the Agency for 
Healthcare Research and Quality's ``Improving Patient Safety Systems 
for Patients with Limited English Proficiency'' guide.\80\
---------------------------------------------------------------------------

    \79\ E.O. 13166, 65 FR 50121 (Aug. 11, 2000).
    \80\ U.S. Dep't of Health & Hum. Servs., Agency for Healthcare 
Rsch. and Quality, Improving Patient Safety Systems for Patients 
With Limited English Proficiency: A Guide for Hospitals (2012), 
https://www.ahrq.gov/sites/default/files/publications/files/lepguide.pdf.
---------------------------------------------------------------------------

    Response: Section 92.8(d) already references covered entities' 
obligations under Sec.  92.201, so it is unnecessary to restate that 
language here. We decline to modify the provision to add language from 
the suggested requirements and resources, as this provision relates to 
covered entities' obligation under section 1557.
    Comment: Many commenters sought clarity about whether the language

[[Page 37560]]

access ``procedures'' required by Sec.  92.8(d) differ from documents 
commonly referred to as language access ``plans.'' Noting OCR's 
longstanding recognition of the benefits of having a language access 
plan, as expressed in the Department's ``2003 Guidance to Federal 
Financial Assistance Recipients Regarding Title VI Prohibition Against 
National Origin Discrimination Affecting Limited English Proficient 
Persons'' (HHS LEP Guidance), 68 FR 47311 (Aug. 8, 2003), many 
commenters recommended that OCR modify Sec.  92.8(d) to clarify that 
covered entities must develop and implement a language access plan 
before developing language access procedures because developing 
effective policies and procedures require such advance planning and 
give covered entities clear policies to follow when seeing patients 
with LEP.
    According to these commenters, formal language access plans require 
a covered entity to consider and evaluate the needs of a service area, 
providing a better understanding of populations, prevalence of specific 
language groups, language access needs, and scope of services needed to 
provide meaningful access. Commenters highlighted the rapid growth of 
pockets of individuals with LEP with distinct language and cultural 
conventions, including indigenous immigrant populations from Central 
and South America, and the changing language needs for recent arrival 
of refugees from Afghanistan, Ukraine, Russia, and other non-English 
speaking countries.
    In contrast, one commenter appreciated that the Proposed Rule did 
not require covered entities to implement language access plans and 
noted that small, covered entities lack resources, including time, 
administrative effort, and financial resources to implement a language 
access plan. Citing the 2015 NPRM, the commenter stated the cost to 
develop a language access plan at $1,135 per small, covered entity,\81\ 
and recommended that OCR finalize the rule without requiring covered 
entities to develop and implement a language access plan.
---------------------------------------------------------------------------

    \81\ The $1,135 figure is derived from the 2015 NPRM for section 
1557 on ``training costs'' for small entities. See 80 FR 54213.
---------------------------------------------------------------------------

    Response: OCR appreciates commenters' emphasis on the value of 
language access plans, which as commenters noted, are distinct from the 
language access procedures required under this section. Covered 
entities are not explicitly required to analyze the specific 
populations with LEP in their service areas. However, in order to 
develop effective language access procedures and ensure compliance with 
the obligations at Sec.  92.201, a covered entity will need to engage 
in some form of analysis to identify the language access needs in their 
service area.
    For example, when finalizing a list of preferred language 
assistance services providers, a covered entity will need to determine 
which providers are most capable of meeting the language needs of the 
individuals with LEP within the service area. To best inform its 
decision-making process, a covered entity may first attempt to identify 
the non-English languages most spoken in the relevant service area and 
confirm that interpreter and translation service providers can 
accommodate those languages. The HHS LEP Guidance, cited by commenters, 
is still instructive and relevant and provides helpful information in 
how to develop a strategy for delivery of language assistance services. 
See 68 FR 47313-22. Covered entities are also encouraged to use the 
language access planning resources provided at https://www.lep.gov/language-access-planning or reference HHS's 2023 Language Access Plan 
for guidance at https://www.hhs.gov/sites/default/files/Language-Access-Plan-2023_0.pdf.
    Covered entities with language access plans are often better 
prepared to provide individuals with LEP with meaningful access to 
their health programs and activities. For covered entities that have 
developed, implemented, and maintained language access plans, we highly 
encourage those covered entities to sustain that practice and to 
consider modifying their plans to include the elements required by 
Sec.  92.8(d), to the extent it is not already included. To the extent 
a covered entity's language access plan meets the requirements of Sec.  
92.8(d), a separate procedures document will not be required regardless 
of whether the document is referred to as a ``plan'' or ``procedures.''
    Comment: Some commenters recommended that OCR delete the 
requirement in Sec.  92.8(d) for covered entities to identify the names 
of qualified bilingual/multilingual staff members due to employee 
turnover, with one commenter also requesting that OCR eliminate the 
requirement to maintain a list and location of electronic and written 
translated materials because such a requirement would be an onerous, 
inefficient use of time due to frequent changes to translated 
materials. Another commenter indicated that these requirements are 
especially difficult for large, covered entities, and that health 
insurance issuers in particular should have the option to provide 
business rules and rationale with respect to how and where they store 
documents rather than create a duplicative process. This commenter also 
recommended that OCR allow covered entities to articulate the process 
for accessing language services and contact information for the covered 
entity's department or functional group responsible for translations.
    Response: OCR acknowledges that covered entities may need to 
periodically revise their language access procedures to reflect changes 
to qualified bilingual/multilingual staff; however, these staff members 
play a critical role in the delivery of timely language assistance 
services and therefore it is imperative that employees be able to 
identify qualified bilingual/multilingual staff members as quickly as 
possible through the use of a current directory. We decline to remove 
the requirement that language access procedures include a current list 
of qualified bilingual/multilingual staff members.
    Timely and effective language assistance services are also best 
served by maintaining a current list of translated materials. OCR notes 
commenters' concerns regarding the practicality and burden of 
maintaining a list of the physical location of all written translated 
materials. For this reason, we are revising the requirement to no 
longer require the location of written translated materials, but only 
how to access electronic translated materials (i.e., their location on 
a covered entity's network, intranet, or external-facing website).
    Section 92.8(d) requires covered entities to include contact 
information for their Coordinator and how employees obtain services of 
qualified interpreters, translators, and multilingual/bilingual staff. 
This allows for covered entities to articulate the process for 
accessing language services; if this function has been delegated to a 
department or functional group, contact information for that department 
or functional group should be included in the language access 
procedures.
    Comment: Some commenters recommended that the Department secure 
resources for small, covered entities to support their provision of 
language assistance services. For example, one commenter recommended 
that OCR contract with a telephonic interpretation service and allow 
small, covered entities to opt-in to using that service. Another 
commenter suggested that OCR partner with the U.S. Department of 
Education to invest in medical interpreter training for smaller 
language communities because investing in these communities would

[[Page 37561]]

result in higher quality health care. Another commenter requested that 
OCR make available sample policies and procedures; best practices for 
working with language assistance companies, identifying qualified (and 
unqualified) interpreters, and producing accurate and quality 
translations; and training videos.
    Response: OCR appreciates these commenters' suggestions for 
providing resources to assist small, covered entities and, we are 
committed to making sample language access procedures available on our 
website at www.hhs.gov/1557. However, it is not appropriate for OCR, as 
a Federal agency, to endorse private interpreter or translator service 
providers. We are also unable to provide a telephonic interpretation 
contract into which small, covered entities could voluntarily 
participate.
    OCR also appreciates the importance of interpreter training for 
less frequently encountered languages and is committed to developing a 
robust health care work force. To illustrate this commitment, the 
Department announced a ``Promoting Equitable Access to Language 
Services in Health and Human Services'' initiative in Fall 2022, for 
which grants were awarded to 11 organizations to develop and test 
methods of informing individuals with LEP about the availability of 
language assistance services in health care settings.\82\
---------------------------------------------------------------------------

    \82\ U.S. Dep't of Health & Hum. Servs., Off. of Minority 
Health, FY 2022 Grants Awards: Promoting Equitable Access to 
Language Services in Health and Human Services (October 11, 2022), 
https://minorityhealth.hhs.gov/fy-2022-grant-
awards#:~:text=Grant%20period%3A%202022%2D2025,in%20health%20care%2Dr
elated%20settings.
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the Language Access procedures 
requirement provision at Sec.  92.8(d) as proposed, with modifications. 
We are revising Sec.  92.8(d) to require language access procedures to 
strike the requirement to include the location of any written or 
electronic materials and adding a requirement to include ``how to 
access electronic translations.'' We replaced ``publication date'' with 
``date of issuance'' to better account for translated materials that 
may be in hard copy or electronic format. We are also making one 
technical revision. We are replacing ``limited English proficient 
individual'' with ``individual with limited English proficiency,'' 
consistent with modifications elsewhere.
Effective Communication Procedures
    Comment: Comments related to proposed Sec.  92.8(e), regarding 
effective communication procedures, were similar to the language access 
procedures comments. Many commenters requested that OCR require covered 
entities to develop and implement a broad ``communication access 
plan,'' which would address effective communication and accessibility 
for individuals with disabilities, including individuals with 
disabilities who also have LEP. Commenters recommended that covered 
entities be required to develop communication access plans prior to 
developing their effective communication procedures. Some commenters 
suggested that a covered entity's effective communication procedures 
should also include how to determine the sign language an individual 
with a communication disability uses and whether the individual needs 
the services of an interpreter team, such as a certified deaf 
interpreter and an American Sign Language interpreter. One commenter 
recommended that we add a requirement for covered entities to create 
section 1557, ADA, and section 504 communication access plans along 
with the effective communication procedures requirement.
    Response: Advance planning is an essential component of developing 
and implementing effective procedures that will ensure compliance with 
the obligations at Sec.  92.202, which necessitate consideration of the 
various aids and services that may be required to deliver effective 
communication. Thus, while covered entities are not explicitly required 
to engage in advance planning, their ability to comply with Sec.  
92.202 will be best supported though robust procedures that are 
developed though a thoughtful and thorough process.
    Covered entities may include more information in their respective 
effective communication procedures than Sec.  92.8(e) requires, and we 
encourage covered entities that are already implementing communication 
access plans to maintain that practice. Covered entities with active 
communication access plans are permitted to modify such plans to 
include the information required by Sec.  92.8(e); to the extent a 
covered entity's communication access plan meets the requirements of 
Sec.  92.8(e), a separate procedures document will not be required 
regardless of whether the document is referred to as a ``communication 
access plan'' or ``effective communication procedures.'' While OCR 
appreciates the similarities between section 1557, section 504, and 
ADA's effective communication requirement, section 1557 is a distinct 
statute and imposing requirements for a similar procedure under the ADA 
and section 504 is outside the authority of this rulemaking.
    Comment: One commenter requested that OCR make clear in the final 
rule that covered entities must implement effective communication and 
language access requirements in a well-coordinated, comprehensive, 
seamless, and equally effective manner such as through a standard 
operating procedure. This commenter also recommended that we inform 
covered entities that effective communication and language access 
requirements are of equal, paramount importance and closely 
interdependent with each other, and the commenter suggested that we 
issue guidance recommending effective communication and language access 
coordination.
    Response: We agree with the commenter that effective communication 
and language access requirements are equally important, and effective 
communication and language access requirements can be interdependent, 
particularly when communicating with individuals with disabilities who 
have LEP. Though covered entities would ideally implement their 
effective communication and language access requirements in a well-
coordinated, comprehensive, seamless, and equally effective manner, we 
decline to revise either paragraph (d) or (e) of Sec.  92.8 or include 
any additional regulatory provisions imposing such standards on covered 
entities, in part, because such standards would be difficult to 
objectively measure.
    Comment: Another commenter recommended that we revise Sec.  92.8(e) 
to require covered entities' effective communication procedures include 
information about how covered entities will assess staff members' 
competency as qualified interpreters or qualified readers.
    Response: We discuss assessment of interpreters at Sec.  92.4; 
because of the flexibility allowed by the definition regarding how a 
covered entity chooses to assess the qualifications of interpreters 
(and readers), we decline to require this information be included in 
the procedures.
    Comment: Some commenters recommended that OCR clarify that a 
covered entity's effective communication procedures apply to 
individuals with any disability that affects an individual's ability to 
communicate. Further, these

[[Page 37562]]

commenters also requested that we clarify that a covered entity's 
auxiliary aids and services options are not limited to qualified 
interpreters. Another commenter recommended that we include examples of 
accommodations, assistance, and opportunities for individuals with 
speech-related disabilities in the preamble and accompanying guiding 
documents.
    Response: Covered entities' effective communication 
responsibilities, further discussed at Sec.  92.202, apply to 
communication with all people with disabilities and a covered entity's 
effective communication procedures must equip employees with the 
information and tools necessary to meet the needs of individuals with 
many different types of disabilities. These may include, but are not 
limited to, sensory, manual, or speaking disabilities. Covered 
entities' obligations to provide auxiliary aids and services extend 
beyond qualified interpreters. A non-exhaustive list of auxiliary aids 
and services can be found in the definition of ``auxiliary aids and 
services'' in Sec.  92.4.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the Effective Communication 
Procedures requirement provision at Sec.  92.8(e) as proposed, without 
modifications.
Reasonable Modification Procedures
    Comment: Many commenters supported the reasonable modification 
procedures requirement under proposed Sec.  92.8(f), with some noting 
that many covered entities, particularly smaller covered entities, are 
unaware of their obligation to reasonably modify their policies and 
procedures when necessary to avoid discrimination on the basis of 
disability. Some commenters recommended that OCR proactively provide 
examples of the types of reasonable modifications that covered entities 
should consider as a means of increasing the likelihood that a covered 
entity's reasonable modifications procedures are adequate. One 
commenter urged OCR to include a statement in the final rule's preamble 
or guidance that a reasonable modification can include communicating in 
a more accessible modality (e.g., via email), if the patient requests 
it.
    Response: It is OCR's intent that requiring a reasonable 
modification procedure will address the lack of knowledge on behalf of 
covered entities that commenters raised, and will increase covered 
entities' ability to respond appropriately to requests. OCR believes 
this will raise overall compliance with the requirement at Sec.  92.205 
to provide reasonable modifications, and will benefit both covered 
entities and individuals seeking access to health programs or 
activities.
    The vast range of potential reasonable modifications available or 
necessary do not lend themselves to an exhaustive list and so we are 
not able to include such a list here. However, many reasonable 
modifications involve reasonable changes in the way that an entity does 
something or permits an individual to do something. For example, a 
covered entity that generally communicates with patients via phone but 
receives a request from an individual with a disability to receive 
communication via email as a modification should generally grant that 
request, unless the covered entity can demonstrate that doing so would 
fundamentally alter the nature of the health program or activity. Other 
examples include allowing an individual with a disability whose 
disability makes attending morning appointments difficult to schedule 
afternoon appointments when appointments may not generally be available 
at that time, or allowing an individual with a disability to attend 
appointments via telehealth instead of in person when such modification 
does not fundamentally alter the nature of the service being provided. 
To be clear, there is no exhaustive list of what constitutes a 
reasonable modification, nor must covered entities develop one. Rather, 
covered entities are required to implement written procedures 
describing their process by which an individual with a disability may 
request a reasonable modification and how a covered entity processes 
and responds to such requests.
    Comment: One commenter stated that a covered entity must provide 
reasonable modifications to an individual with a disability in the 
absence of an affirmative request for the modification if the covered 
entity had knowledge of the individual's disability or when the 
individual's disability is obvious. Relatedly, another commenter 
requested that OCR revise Sec.  92.8(f) to reflect that an individual's 
failure to request a reasonable modification does not always excuse the 
covered entity from providing a reasonable modification if the 
modification does not result in a fundamental alteration.
    Response: Section 92.8(f) is an administrative requirement to 
implement a procedure by which a reasonable modification can be 
requested, evaluated, and granted. However, as noted in the 2022 NPRM, 
failure to request a reasonable modification does not always excuse the 
covered entity from providing a reasonable modification to avoid 
discrimination on the basis of disability, as long as the modification 
would not result in a fundamental alteration of the health program or 
activity. 87 FR 47850. For example, when a covered entity has knowledge 
of an individual's disability and needs, or when an individual's 
disability and needs are obvious, a covered entity must provide 
modifications in the absence of a request.\83\
---------------------------------------------------------------------------

    \83\ See, e.g., Greer v. Richardson Indep. Sch. Dist., 472 F. 
App'x 287, 296 (5th Cir. 2012) (holding that a ``failure to 
expressly `request' an accommodation is not fatal to an ADA claim 
where the defendant otherwise had knowledge of the individual's 
disability and needs but took no action''); Duvall v. Cnty. of 
Kitsap, 260 F.3d 1124, 1139 (9th Cir. 2001) (``When the plaintiff 
has alerted the public entity to his need for accommodation (or 
where the need for accommodation is obvious . . .), the public 
entity is on notice that an accommodation is required . . .'').
---------------------------------------------------------------------------

    Comment: Some commenters noted a common occurrence where patients 
with disabilities must repeatedly request the same reasonable 
modifications or auxiliary aids and services from the same covered 
entity for each visit. These commenters urged OCR to include additional 
language in the final rule preamble and guidance for covered entities 
to minimize patients' burdens of having to repeatedly notify, request, 
monitor, and enforce the covered entity's obligation to remove access 
barriers.
    Response: These commenters' recommendations mirror similar comments 
related to experiences of patients with LEP who must repeatedly request 
the same language assistance services from the same covered entity. 
Such a practice may be inefficient and may violate the requirements of 
this part if they result in the delay or denial of access to a health 
program or activity. See discussion of Sec.  92.201. While we strongly 
recommend that covered entities engage in the best practice of 
documenting in patients' medical records the specific reasonable 
modifications requested by patients with disabilities, in an effort to 
avoid overly prescriptive requirements we decline to revise Sec.  
92.8(f).
    Comment: Commenters recommended that OCR require covered entities 
to appoint an individual to ensure compliance with the reasonable 
modification requirement. This person would: inquire whether patients 
need communications-related modifications; ensure such modifications 
are provided promptly; and monitor the patient's stay

[[Page 37563]]

to ensure the modification is provided through the duration of the 
entire stay. This person would also be responsible for ensuring the 
covered entity is otherwise complying with the requirement to provide 
auxiliary aids and services.
    Response: This rule, at Sec.  92.7, requires designation of a 
Section 1557 Coordinator by covered entities that employ 15 or more 
persons. The Coordinator is responsible for ensuring compliance with 
section 1557's requirements, including the requirement to provide 
auxiliary aids and services at Sec.  92.202 and to make reasonable 
modifications at Sec.  92.205. A covered entity may delegate 
responsibility for the actual provision of auxiliary aids and 
reasonable modifications, and implementation of the corresponding 
procedures, to an individual other than the Coordinator, such as a 
designee; however, we decline to require the designation of an 
additional employee to implement these requirements.
    Comment: One commenter recommended that OCR revise the regulatory 
text for Sec.  92.8(f) to substitute the modifier ``reasonable'' with 
``reasonable and appropriate.''
    Response: We decline to adopt the commenter's suggested regulatory 
revision because ``reasonable modification'' is a term of art with a 
long history of enforcement in the disability context. We note that, 
consistent with similar longstanding disability rights law enforcement, 
we use ``appropriate'' in Sec. Sec.  92.8(e) and 92.202(b) when 
describing the auxiliary aids and services that a covered entity must 
use to effectively communicate with individuals with disabilities.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the Reasonable Modification 
Procedures requirement provision at Sec.  92.8(f) as proposed, without 
modifications.
Training (Sec.  92.9)
    In Sec.  92.9, we proposed requiring covered entities to train 
relevant employees in their health programs and activities on their 
Section 1557 Policies and Procedures.
    In Sec.  92.9(a), we proposed a general requirement that covered 
entities train relevant employees of their health programs and 
activities on the Section 1557 Policies and Procedures required by 
proposed Sec.  92.8.
    In Sec.  92.9(b), we specified when covered entities must train 
relevant employees on their Section 1557 Policies and Procedures.
    In Sec.  92.9(b)(1), we proposed that covered entities would be 
required to train existing relevant employees on their Section 1557 
Policies and Procedures as soon as practicable, but no later than one 
(1) year after the effective date of the final rule.
    In Sec.  92.9(b)(2), we proposed that covered entities train new 
relevant employees within a reasonable period of time after they join a 
covered entity's workforce.
    In Sec.  92.9(b)(3), we proposed requiring covered entities to 
train relevant employees whose roles are affected by material changes 
to the covered entity's Section 1557 Policies and Procedures and any 
other civil rights policies or procedures the covered entity has 
implemented.
    In Sec.  92.9(c), we proposed requiring covered entities to 
contemporaneously document their employees' completion of the training 
required by this section in written or electronic form and maintain 
said documentation for no less than three (3) calendar years.
    We invited comment on the experiences of covered entities in 
implementing training such as that required by proposed Sec.  92.9, 
examples of where training made a difference in compliance, the timing 
of required training, whether covered entities would like the 
flexibility to include this required training as part of their existing 
annual compliance training, what types of changes would constitute a 
material change such that a covered entity would need to retrain staff, 
and how long training records must be retained. We also sought general 
comment on this proposal, including the effectiveness of civil rights 
training programs, the benefits experienced by covered entity staff and 
the people they serve, as well as the costs associated with the 
proposed training requirements. We further requested comment on whether 
the Section 1557 Policies and Procedures requirements and training 
requirements may increase the likelihood of compliance with the 
substantive legal requirements of section 1557.
    The comments and our responses regarding Sec.  92.9 are set forth 
below.
    Comment: Many commenters on this provision expressed support for 
the training requirement and provided a range of reasons, including 
because the training is intended to impart knowledge and awareness of 
civil rights requirements and responsibilities; it will serve as an 
additional safeguard against discrimination and help reduce health 
disparities; and it will help providers connect patients to the 
services they need.
    Commenters believed that a covered entity's staff need to 
understand section 1557 requirements, especially considering increased 
instances of employee turnover. One commenter also encouraged OCR to 
repeat the language in the Proposed Rule and remind covered entities 
that ``the more thoroughly a covered entity trains its staff on its 
Section 1557 Policies and Procedures, the more likely it is that the 
covered entity will successfully provide services to individuals in a 
nondiscriminatory manner.'' 87 FR 47850.
    Some commenters said that civil rights violations occur due to lack 
of awareness and that training on covered entities' Section 1557 
Policies and Procedures will help eliminate discrimination in health 
care because it promotes knowledge about how to deliver and administer 
health programs and activities to all patients, including patients who 
are members of communities that have experienced discrimination in 
health care services.
    Some commenters suggested that OCR provide additional detail 
regarding the contents and delivery of the training, including by being 
more explicit about the nature and standards for determining adequacy 
of training. Conversely, one commenter recommended that OCR not make 
the training requirement overly prescriptive, and another asked OCR to 
give covered entities the authority to determine the training elements 
that best fit covered entities' operations.
    Some commenters opposed the training requirement, referencing 
existing compliance burdens for providers, particularly small 
providers. Some commenters requested that OCR abandon the training 
requirement in the final rule because the requirement lacks 
specificity, is weak, vague, difficult to enforce, ineffective, will 
require more paperwork, and will confuse specialty clinics like dental 
offices; one commenter requested that OCR specifically exempt 
dermatology practices from the training requirement.
    Many of the commenters that opposed the training requirement added 
that, if the rule is finalized as proposed, OCR should develop and 
provide educational materials and training resources, including 
materials to test trained employees' understanding of the new 
requirements.
    Response: Section 92.9 requires covered entities to train relevant 
employees on their tailored Section 1557 Policies and Procedures, which 
will serve as a proactive safeguard against discrimination. Given this 
benefit, we decline to remove this

[[Page 37564]]

provision or exempt specific fields of practice from compliance with 
this requirement.
    Recognizing the resources needed to comply with the training 
requirement, Sec.  92.9 allows covered entities flexibility in 
designing the training they provide. However, the efficacy of the 
training--and its civil rights compliance benefit--will depend on a 
covered entity's effort in developing and conducting the training. 
OCR's experience with enforcing HIPAA's training requirement, 45 CFR 
164.530(b), has found that employee-related violations are more limited 
where the required HIPAA training is routinely provided compared to 
where it is not. We anticipate that the section 1557 training 
requirement will similarly result in covered entities' employees being 
more aware of section 1557's discrimination prohibitions and establish 
a foundation by which covered entities' employees more consistently 
comply with nondiscrimination requirements.
    With respect to the commenters' view that the training requirement 
will be difficult to enforce, the document retention requirement in 
Sec.  92.9(c) is designed to assist with this. Moreover, OCR has been 
successfully enforcing HIPAA covered entities' compliance with HIPAA 
training requirements for more than 20 years. Through investigations, 
OCR evaluates covered entities' compliance with training requirements, 
and, when necessary, OCR ensures that a covered entity takes corrective 
actions to comply with said requirement.
    To support compliance with this rule, OCR has made materials 
available on our website at www.hhs.gov/1557; however, the training 
required under Sec.  92.9 must be based on the covered entity's own 
policies and procedures. Thus, while OCR is providing general resources 
on section 1557 requirements, they must be supplemented by the covered 
entity to include information regarding their specific Section 1557 
Policies and Procedures.
    Comment: Several commenters asked OCR to clarify whether covered 
entities could incorporate training on their Section 1557 Policies and 
Procedures with existing employee and annual compliance training 
instead of mandating a stand-alone training. One commenter recommended 
that covered entities train their employees on their respective Section 
1557 Policies and Procedures separately because combining this training 
can result in information overload if employees are trained on multiple 
issues at the same training.
    Response: This rule does not require or prohibit covered entities 
from incorporating the training required under Sec.  92.9 with pre-
existing employee or annual compliance trainings. We encourage covered 
entities to regularly train employees on their Section 1557 Policies 
and Procedures, possibly alongside other annual compliance trainings, 
and we recommend that covered entities offer section 1557 trainings in 
a manner that will result in maximum knowledge retention. While the 
rule does not specify the frequency with which trainings must be 
provided, covered entities should keep in mind that they must train new 
employees within a reasonable period of time after the employee joins a 
covered entity's workforce.
    Comment: We received several comments recommending that OCR clarify 
the term ``relevant employees'' who must be trained under Sec.  92.9. 
Many commenters recommended that we define ``relevant employees'' in 
the final rule's definitions section at Sec.  92.4 or within Sec.  92.9 
itself. Some commenters suggested that ``relevant employees'' should 
include: employees whose roles and responsibilities require interfacing 
with patients and the public; employees who make decisions about 
patient care and covered entity operations that impact patient care; 
employees in leadership and supervisory roles who make decisions that 
affect nondiscrimination; and employees, including C-suite leadership 
(i.e., the chief executive officer, chief financial officer, chief 
operating officer, and chief information officer), who are responsible 
for executing and making decisions regarding financial assistance, 
patient billing, and collections. Citing the importance of interactions 
between covered entities and patients in the long-term services and 
supports context, one commenter recommended that ``relevant employees'' 
should include temporary staff who interact with the public or clients.
    Response: We appreciate commenters' recommendations to define 
``relevant employee.'' Though we described a covered entity's relevant 
staff who must receive the training required in the 2022 NPRM, 87 FR 
47851, based on comments received, we agree that including more 
specificity in the final rule text will add additional clarity for 
covered entities. We have provided a description of ``relevant 
employee(s)'' in new Sec.  92.9(b)(4), which that, for purposes of the 
section, ``relevant employees'' includes employees whose roles and 
responsibilities entail interacting with patients and members of the 
public; making decisions that directly or indirectly affect patients' 
health care, including the covered entity's executive leadership team 
and legal counsel; and performing tasks and making decisions that 
directly or indirectly affect patients' financial obligations, 
including billing and collections. Below, we specify that relevant 
employees may include temporary employees in addition to permanent 
employees and have revised the regulatory text accordingly.
    Comment: Other commenters recommended that OCR require covered 
entities to train all of their employees on the covered entities' 
Section 1557 Policies and Procedures because all employees may 
encounter a patient at any time, and they should understand basic 
section 1557 concepts. One commenter suggested that if OCR does not 
require covered entities to train all of their employees, then we 
should broaden who we consider to be ``relevant employees'' because 
employees who do not have direct patient interaction or policy-making 
roles may still have section 1557 responsibilities, and many of these 
employees are likely to engage in incidental patient interaction during 
the course of their work.
    Response: A covered entity has the discretion to train all of its 
employees to eliminate the burden of determining who the covered entity 
believes is and is not a relevant employee. OCR notes that an employee 
who makes decisions that indirectly affect patients' health care or 
financial obligations meets the definition for ``relevant employee'' at 
Sec.  92.9(b)(4), and therefore a covered entity would need to train 
such an employee pursuant to this provision. However, given the 
diversity of covered entities under this rule, we decline to mandate 
training for all staff. For example, to do so may cause confusion for 
covered entities that operate a health program that is part of a larger 
operation (e.g., a retail grocery store that also operates a covered 
pharmacy).
    Comment: Some commenters recommended that, due to high staff 
turnover and the common practice of hiring temporary, contract, or 
travel staff, OCR should consider allowing temporary staff to transfer 
prior, completed training from one facility to another to limit burden 
and redundancy. These commenters also asked OCR to permit training 
completion documentation from one covered entity to meet the 
documentation requirement for another covered entity as a means to 
limit burden and redundancy.
    Response: Section 92.9 requires a covered entity to train employees 
on its

[[Page 37565]]

specifically tailored Section 1557 Policies and Procedures. Thus, 
Covered Entity A's Section 1557 Policies and Procedures will be 
different from Covered Entity B's Section 1557 Policies and Procedures, 
and therefore a temporary employee's training on Covered Entity A's 
policies and procedures will not be transferable to Covered Entity B. 
Though temporary, contractor, and travel employees may be with an 
entity for a limited amount of time, that does not minimize the 
likelihood that these employees may still encounter an individual with 
LEP or an individual with a disability who may need language assistance 
services, effective communication, or a reasonable modification. 
Covered entities that hire temporary, contract, and travel employees 
will still need to train these employees, document such training, and 
maintain that documentation for the requisite amount of time. We note 
that this approach is consistent with OCR's enforcement of the HIPAA 
training requirement.
    Comment: Several commenters requested that OCR require covered 
entities to train their employees beyond their respective Section 1557 
Policies and Procedures. For example, commenters suggested that OCR 
require covered entities to train their employees on a variety of 
issues including: how to work with interpreters (in person, over the 
telephone, and via remote video); cultural competence, including how 
employees should address stigma experienced by individuals with LEP and 
individuals with disabilities; interacting with people with 
disabilities (including individuals who are deaf, hard of hearing, 
deafblind, and deaf-disabled); and how to competently address 
transgender and nonbinary patients.
    Some commenters recommended that covered entities invite 
individuals with disabilities and other diverse backgrounds to help 
conduct required training because learning from people with lived 
experiences will help covered entities achieve effective communication 
and reduce biases. Another commenter recommended that OCR work with 
stakeholders to develop appropriate training materials.
    Response: We encourage covered entities to consider investing in 
their workforces by providing employees additional civil rights and 
nondiscrimination training beyond what Sec.  92.9 requires. For 
example, covered entities may deploy interactive civil rights trainings 
that involve questions and answers and that more actively engages 
participants rather than the use of training formats like pre-recorded 
sessions to maximize comprehension of complex civil rights concepts. 
OCR also acknowledges that hiring, collaborating with, or otherwise 
engaging individuals with disabilities and other individuals from 
underserved communities to provide input on training (and the 
underlying Section 1557 Policies and Procedures) is a best practice. 
Further, engaging with these same groups to provide training regarding 
best practices and other civil rights-related issues will give a 
covered entity's employees valuable perspective about the importance of 
delivering compassionate, inclusive, and responsive health care.
    However, we decline to expand the scope of the training requirement 
at this time. It is our position that the training on the Section 1557 
Policies and Procedures required in Sec.  92.9 strikes the appropriate 
balance between covered entities' burden concerns and the need for 
awareness of this vital information. We note that OCR has provided a 
general resource on section 1557 requirements that can supplement 
covered entities' Section 1557 Policies and Procedures training, 
available at www.hhs.gov/1557.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing Sec.  92.9 as proposed, with 
modifications. We are revising Sec.  92.9(b)(1) to specify that a 
covered entity must begin training its relevant employees no later than 
30 days after a covered entity implements its policies and procedures 
required by Sec.  92.8 and no later than 300 days after the effective 
date of the part. We are including a definition of ``relevant 
employee(s),'' for purposes of the section only, at Sec.  92.9(b)(4) to 
provide: ``for the purposes of this section `relevant employees' 
includes permanent and temporary employees . . . .'' Lastly, we are 
modifying Sec.  92.9(c) to clarify that covered entities are required 
to retain (rather than ``maintain'') training documentation for the 
requisite time period.
Notice of Nondiscrimination (Sec.  92.10)
    In Sec.  92.10(a), we proposed requiring covered entities to 
provide a notice of nondiscrimination, relating to their health 
programs and activities, to participants, beneficiaries, enrollees, and 
applicants of their health programs and activities, and to members of 
the public (``Notice of Nondiscrimination''). Section 92.10(a)(1) 
proposed the required contents of the Notice of Nondiscrimination. 
Section 92.10(a)(2) proposed when and where covered entities must 
provide the Notice of Nondiscrimination.
    In Sec.  92.10(b), we proposed that a covered entity may combine 
the content of the notice required by Sec.  92.10(a) of this section 
with the notices required by title VI, section 504, title IX, and the 
Age Act implementing regulations \84\ if the combined notice clearly 
informs individuals of their civil rights under section 1557 and the 
part and meets the requirements outlined in proposed Sec.  92.10(a)(1).
---------------------------------------------------------------------------

    \84\ 45 CFR 80.6(d) (title VI); 84.8 (section 504, federally 
assisted); 85.12 (section 504, federally conducted); 86.9 (title 
IX); 91.32 (Age Act).
---------------------------------------------------------------------------

    We invited comment on whether the Notice of Nondiscrimination 
requirement as proposed is practical, likely to be effective, and 
responsive to concerns raised regarding the 2016 and 2020 Rules, 
including the sufficiency of the contents of the notice and 
requirements regarding when and where covered entities must provide 
this notice. We sought comment on the best ways to provide an 
accessible notice to individuals with disabilities who may require 
auxiliary aids and services and the best way in which to provide the 
notice in a manner accessible to individuals with LEP.
    The comments and our responses regarding Sec.  92.10 are set forth 
below.
    Comment: Many commenters strongly support the notice requirements 
set forth in Sec. Sec.  92.10 and 92.11 (Notice of Availability), 
stating that such notices are needed to help people know their rights 
and will reduce health disparities, especially for persons with LEP and 
persons with disabilities. Some organizational commenters added that 
when the 2016 Rule's notice requirement, former 45 CFR 92.8, was 
removed by the 2020 Rule, many people did not know their rights, how to 
access interpreters or auxiliary aids and services, or how to file a 
grievance. Several commenters added that a clear explanation of rights 
and contact information for the Section 1557 Coordinator, as set forth 
in Sec.  92.10(a)(1)(v), is crucial. Some disability rights groups 
commented that not only should the Section 1557 Coordinator's contact 
information be included, but also that of the ADA Coordinator.
    Response: The Notice of Nondiscrimination is a critical means by 
which to inform individuals of their civil rights, which is part of a 
proactive civil rights compliance structure that functions--in part--
through grievances and complaints raised by individuals. We decline to 
require inclusion of contact information for an ADA

[[Page 37566]]

Coordinator as this regulation is limited to section 1557; further, not 
all covered entities under this rule are subject to the ADA.
    Comment: Various covered entities commented that the burden of the 
notice provisions is compounded by the complexity of having two 
separate notices (i.e., the Notice of Nondiscrimination and the Notice 
of Availability) and the requirements to provide information in 15 
languages.
    Response: OCR takes seriously the concerns raised by some 
commenters regarding burden. In crafting the two distinct notice 
requirements, OCR considered comments received in response to the 2015 
and 2019 NPRMs regarding the burden of a notice requirement. The 
provisions in the final rule reflect careful consideration of what must 
be included in each notice, and they include substantially more clarity 
regarding when and where each notice must be provided compared to the 
2016 Rule.
    We note that there is not a requirement that ``all information'' be 
provided in multiple languages; the requirement is that the Notice of 
Availability required by Sec.  91.11 be provided in 15 non-English 
languages to inform individuals of the availability of language 
assistance services and auxiliary aids and services. Further discussion 
of this requirement can be found in our discussion related to the 
Notice of Availability (Sec.  92.11).
    Comment: Many commenters noted that the parenthetical for sex 
discrimination included in proposed Sec.  92.10(a)(1)(i) differs from 
the language of Sec.  92.101(a)(2) and that it should be consistent, 
such that it should include sexual orientation and gender identity as 
well as pregnancy-related conditions.
    Response: OCR appreciates the need for consistency across the 
regulation, and to ensure that the public is aware of the various bases 
for discrimination included under the umbrella of sex discrimination. 
As such, OCR has revised the parenthetical in Sec.  92.10(a)(1)(i) to 
directly cite to Sec.  92.101(a)(2), rather than listing examples of 
discrimination on the basis of sex. This is consistent with edits made 
to the Nondiscrimination Policy required by Sec.  92.8(b).
    Comment: Various commenters requested that OCR require any entity 
receiving a religious exemption to include notice of the exemption in 
the Notice of Nondiscrimination; they said it would be misleading to 
have a notice stating that the entity does not discriminate if it has 
been granted permission to do so in certain circumstances. They stated 
that the information is needed for LGBTQI+ persons seeking health care.
    Response: OCR appreciates these comments. OCR declines to revise 
Sec.  92.10 to impose an affirmative obligation on a recipient to 
identify any exemptions it has received under applicable Federal 
religious freedom and conscience laws. OCR additionally notes that it 
is a best practice for a recipient to include in its Notice of 
Nondiscrimination language when it has received a temporary exemption 
or an assurance of exemption. OCR is also subject to the Freedom of 
Information Act (FOIA), and information may be released to a requestor 
or made available for public inspection consistent with the agency's 
obligations under that statute and its implementing regulations.
    Comment: Several commenters stated that the Notice of 
Nondiscrimination should be provided in the same non-English languages 
required by Sec.  92.11 (Notice of Availability). Several commenters 
urged OCR to create a model Notice of Nondiscrimination, and to issue 
translations of this notice.
    Response: The Notice of Nondiscrimination is among the materials 
that must be accompanied by a Notice of Availability, per Sec.  
92.11(c)(5)(i), which must be provided in multiple languages. While we 
have declined to require translation of the Notice of Nondiscrimination 
into a set number of languages, covered entities may still be required 
to provide translations when necessary to ensure meaningful access as 
required under Sec.  92.201. OCR will provide a sample Notice of 
Nondiscrimination and may provide translations of the sample Notice of 
Nondiscrimination.\85\
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    \85\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Translated Resources for Covered Entities, https://www.hhs.gov/civil-rights/for-individuals/section-1557/translated-resources/ (translated Notice of Nondiscrimination. Statement of 
Nondiscrimination, and Taglines required by the 2016 Rule).
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    Comment: Some commenters argued that the requirement for when and 
where the Notice of Nondiscrimination must be provided, Sec.  
92.10(a)(2), is too burdensome; others commented that it eases 
financial burdens compared to the 2016 Rule requirements, while also 
ensuring that people receive information about the covered entities' 
civil rights obligations. Some commenters supported the requirement of 
prominent posting on websites, including because of the low cost, while 
another commenter observed that poor and rural areas sometimes cannot 
be reached by internet and described the need to reach historically 
underserved and marginalized populations.
    Various commenters agreed with the proposal to provide the Notice 
of Nondiscrimination annually and upon request as opposed to the 2016 
Rule's ``significant communications'' \86\ requirement, including 
because the current proposal is clearer than the 2016 Rule requirement. 
Others stated that OCR should require the Notice of Nondiscrimination 
in all significant communications, such as Explanations of Benefits and 
patient intake forms. Some opposed annual notices as costly and 
annoying to patients, recommending that notice instead be upon 
enrollment, upon request, and prominently in health care plan 
documents. Others argued for using the HIPAA model, which requires 
notice at first point of service and then upon request only.
---------------------------------------------------------------------------

    \86\ 87 FR 47852-53 (discussion in 2022 NPRM); 85 FR 37161-62, 
37175 (discussion in 2020 Final Rule).
---------------------------------------------------------------------------

    Response: In developing the points of contact at which a Notice of 
Nondiscrimination must be provided, OCR considered the concerns raised 
by covered entities regarding burden, consumer fatigue, and lack of 
clarity and specificity in prior requirements. However, we also 
considered comments that stated the Notice of Nondiscrimination is 
important to ensure that persons are informed of their civil rights and 
without this knowledge, including the right to language assistance 
services and effective communication, health disparities may continue 
to increase as they did during the COVID-19 pandemic. The provision is 
a reasonable and balanced approach that reduces the number of 
communications in which this essential notification is required 
compared to the 2016 Rule requirements,\87\ while preserving its 
necessary function.
---------------------------------------------------------------------------

    \87\ Id.
---------------------------------------------------------------------------

    While OCR appreciates that many individuals lack internet access, 
we note that the regulation as drafted requires posting in physical 
locations, as well as being provided upon request, Sec.  
92.10(a)(2)(ii) and (iv); therefore, access to the Notice of 
Nondiscrimination is not dependent on internet access.
    Comment: Various commenters recommended that the Notice of 
Nondiscrimination be posted prominently where frontline employees can 
see it, and that it be in large sans serif font (at least 18-point 
font).
    Response: OCR appreciates these comments and the importance of 
ensuring that the Notice of Nondiscrimination posted in physical

[[Page 37567]]

locations can be seen and is accessible to individuals who may have low 
vision. For this reason, we are finalizing Sec.  92.10(a)(2)(iv) to 
require that posted notices be in a sans serif font, no smaller than 
20-point font.\88\
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    \88\ See Am. Council of the Blind, Best Practices and Guidelines 
for Large Print Documents Used by the Low Vision Community (2011), 
https://archive.org/details/bestpracticesgui00coun.
---------------------------------------------------------------------------

    Comment: Several commenters argued that the Notice of 
Nondiscrimination and Notice of Availability must be provided together, 
because they are so intertwined, adding that this may also reduce the 
burden for covered entities.
    Response: OCR appreciates this comment and directs commenters to 
the requirement at Sec.  92.11(c)(5)(i), which requires that the Notice 
of Availability be provided with the Notice of Nondiscrimination. 
Covered entities may choose to integrate the Notice of Availability 
into its Notice of Nondiscrimination.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.10, with modifications. OCR is revising the explanatory 
parenthetical for sex at Sec.  92.10(a)(1)(i) to read ``consistent with 
the scope of sex discrimination described at Sec.  92.101(a)(2).'' We 
are also providing a technical revision to Sec.  92.10(a)(1)(iii) to 
replace ``necessary'' with ``a reasonable step'' for consistency with 
the standard articulated in Sec.  92.201(a), that ``[a] covered entity 
must take reasonable steps to provide meaningful access to each 
individual with limited English proficiency (including companions with 
limited English proficiency) eligible to be served or likely to be 
directly affected by its health programs and activities.'' We are 
revising Sec.  92.10(a)(2)(iv) to require that posted notices be 
provided ``in no smaller than 20-point sans serif font.'' Finally, we 
are making a technical revision to replace ``limited English proficient 
individual'' with ``individual with limited English proficiency,'' 
consistent with modifications elsewhere.
Notice of Availability of Language Assistance Services and Auxiliary 
Aids and Services (Sec.  92.11)
    In Sec.  92.11, we proposed requiring covered entities to notify 
the public of the availability of language assistance services and 
auxiliary aids and services for their health programs and activities 
(``Notice of Availability'').
    In Sec.  92.11(a), we proposed requiring a covered entity to 
provide a notice that, at minimum, states that the covered entity 
provides language assistance services and appropriate auxiliary aids 
and services free of charge in its health programs and activities, when 
necessary for compliance with section 1557 or the part. This notice 
must be provided to participants, beneficiaries, enrollees, and 
applicants of the covered entity's health program or activity, and 
members of the public.
    In Sec.  92.11(b), we proposed requiring the Notice of Availability 
to be provided in English and at least the 15 most common languages 
spoken by individuals with LEP of the relevant State or States, and in 
alternate formats for individuals with disabilities who require 
auxiliary aids and services to ensure effective communication.
    In Sec.  92.11(c), we proposed requiring the notice be provided on 
an annual basis to participants, beneficiaries, enrollees (including 
late and special enrollees), and applicants, and upon request at any 
time; we also proposed that the notice be provided online (when 
applicable) and in a clear and prominent physical location where it is 
reasonable to expect individuals seeking services from the health 
program or activity to be able to read or hear the notice. In Sec.  
92.11(c)(5), we proposed a list of specific electronic and written 
communications that the Notice of Availability must accompany. We 
invited comment as to whether requiring a Notice of Availability for 
all Explanation of Benefit (EOB) documents is the most appropriate 
approach, balancing the burden of providing Notices of Availability 
with all EOBs against the burdens associated with determining which 
EOBs must include the notice.
    In Sec.  92.11(d), we proposed alternative, optional methods by 
which a covered entity may be deemed in compliance with proposed Sec.  
92.11(a).
    We sought comment on whether the Notice of Availability requirement 
as proposed is practical and responsive to concerns raised regarding 
the 2016 and 2020 Rules, including the sufficiency of the content of 
the Notice of Availability and requirements for when and where covered 
entities must provide the notice. We also invited comment as to whether 
the proposed requirements adequately address the specific concerns 
raised regarding the burdens associated with the 2016 Rule requirements 
by providing a list of specific documents with which the Notice of 
Availability must be provided. Additionally, we invited comment on how 
to best provide the Notice of Availability to individuals with 
disabilities to ensure they know how to request and receive relevant 
materials and documents in formats that meet their disability-related 
needs, and whether covered entities should be required to provide the 
Notice of Availability in sign language. Similarly, we sought comment 
on how to best provide the Notice of Availability to individuals with 
LEP, including individuals with LEP with disabilities, to ensure they 
know how to request and receive language assistance services and 
auxiliary aids and services to provide meaningful access to relevant 
materials and documents. We also sought comment on whether the proposed 
list of electronic and written communications that the Notice of 
Availability must accompany adequately captures the documents for which 
individuals with LEP and individuals with disabilities should receive 
the Notice of Availability. We further invited comment on the 
anticipated costs to covered entities of various sizes to comply with 
the proposed requirements.
    The comments and our responses regarding Sec.  92.11 are set forth 
below.
    Comment: Many commenters stated that the Notice of Availability is 
needed because people are unaware of their rights to language 
assistance and auxiliary aids and services, leaving them unable to 
advocate for themselves and leading to health disparities. Commenters 
agreed that the 2019 NPRM and 2020 Rule fail to address the costs borne 
by participants, beneficiaries, and enrollees in the absence of notice, 
and the additional costs to the health care system that could result. 
87 FR 47853. Many commenters provided examples of how individuals with 
LEP experience disparities in health care, including poor care and 
outcomes; higher uninsured status; lower health literacy; longer 
hospital stays; greater difficulty understanding health instructions; 
and general health care underuse. The commenters emphasized that 
providing Notice of Availability is the most essential element to 
decreasing language barriers and that with proper notice of their 
rights, health disparities for individuals with LEP would be reduced.
    Response: OCR appreciates commenters highlighting the importance of 
providing individuals with LEP notice of their right to receive 
language assistance services, and the negative consequences of failure 
to do so. As discussed, OCR considered the concerns raised in response 
to the 2019 NPRM and 2020 Rule's failure to include a similar notice 
provision, as well as concerns raised in response to the 2016 Rule's 
notice provision. As proposed and finalized, Sec.  92.11 provides

[[Page 37568]]

an appropriate balance between the approaches of these prior rules and 
is an important tool for combatting and preventing health disparities 
based on communication barriers.
    Comment: Numerous commenters stated that the requirement to provide 
the Notice of Availability in 15 non-English languages was too many, 
providing examples of places in which they believe fewer languages were 
needed. For example, one provider commented that in California, 95 
percent of their communications were requested in the top five 
languages in the State, therefore translations into the top five 
languages would be sufficient. Other commenters noted that smaller 
entities would be particularly burdened by the proposed standards. One 
commenter stated that requiring pediatric dental offices to offer the 
Notice of Availability as proposed would be burdensome and cause 
confusion.
    Conversely, many other commenters stated that 15 languages is too 
few and that, under the proposed requirements, the Notice of 
Availability would not reach enough individuals with LEP, giving 
examples of language populations that would not be reached. Some 
commenters expressed a belief that covered entities should ensure each 
individual with LEP receives information about their rights in their 
preferred language, and that a 15-language requirement would not 
adequately provide that assurance. Some commenters stated that the 
identification of languages required should not be determined at the 
State level but should instead be based on the covered entity's entire 
program area in various states. On the other hand, some commenters 
expressed that the required languages should always be determined at 
the State level only, rather than ``State or States.''
    Commenters said that because OCR will provide model notices 
translated into the required languages, and because of the need for 
meaningful notice of auxiliary aids and language assistance services, 
the burden for providing notices in the top 15 languages per State is 
lessened and reasonable. A few local government commenters stated that 
their jurisdiction currently requires translation in more than 100 
languages and recommended that this rule incorporate State and local 
norms.
    Response: In determining the formula for the Notice of Availability 
translation requirement, OCR considered the 2016 Rule requirement, 
evaluated national- and State-level language proficiency data issued by 
the U.S. Census Bureau (Census), as well as potential the costs and 
burdens for covered entities.
    The need to provide individuals with LEP notice of the availability 
of language assistance services remains clear and there is ample 
evidence that failure to provide meaningful language access in a health 
care setting can lead to higher costs to the health care system and 
have grave consequences to individuals with LEP. 87 FR 47853-54. Since 
the ACA was enacted, the percentage of the U.S. population with LEP 
(defined as those who speak English less than ``very well,'' as 
collected by the Census) has remained at roughly 10 percent.\89\
---------------------------------------------------------------------------

    \89\ U.S. Bureau of Census, Sandy Dietrich & Erik Hernandez, 
Language Use In the United States: 2019, Am. Community Survey 
Reports, p. 4 (2022), https://www.census.gov/content/dam/Census/library/publications/2022/acs/acs-50.pdf.
---------------------------------------------------------------------------

    OCR has received complaints and entities have sued the Department 
for rescinding the 2016 Rule's notice requirements.\90\ Litigants in 
Chinatown Services Center v. U.S. Department of Health & Human Services 
raised specific concerns that older members of the Asian American, 
Native Hawaiian, and Pacific Islander community, who have high rates of 
limited English proficiency, experienced disparities because they are 
not aware of their right to receive language assistance services or how 
to raise a concern when such services are not provided.\91\ Although 
one Federal court ultimately held that a plaintiff health system was 
not likely to prevail on the merits of its Administrative Procedure Act 
challenge to the 2020 Rule's repeal of the 2016 Rule's notice 
requirements, the court notably acknowledged that a consequence of the 
2020 Rule was that the plaintiff health system provided ``costlier and 
more difficult treatment'' because patients with LEP likely received 
inadequate health care elsewhere and arrived to their system sicker 
than they otherwise may have.\92\
---------------------------------------------------------------------------

    \90\ See Compl., Chinatown Serv. Ctr. v. U.S. Dep't of Health & 
Hum. Servs., No. 1:21-cv-00331 (D.D.C. Feb. 25, 2021), Compl., 
Whitman-Walker Clinic v. U.S. Dep't of Health Hum. Servs., No. 1:20-
cv-01630 (D.D.C. June 22, 2020) and see 87 FR 47853-54.
    \91\ Compl., Chinatown Serv. Ctr. v. U.S. Dep't of Health & Hum. 
Servs., No. 1:21-cv-00331, 22-35 (D.D.C. Feb. 25, 2021).
    \92\ Whitman-Walker Clinic v. U.S. Dep't of Health & Hum. 
Servs., 485 F. Supp. 3d 1, 30 (D.D.C. 2020).
---------------------------------------------------------------------------

    OCR appreciates concerns regarding proposed Sec.  92.11, which 
would require a covered entity operating in all 50 States to aggregate 
the populations with LEP across those States to determine the top 15 
languages spoken by individuals with LEP in its service area. While 
this may result in a failure to reach some in-State LEP populations due 
to geographical variances, no single formula, including a State-level 
formula, will cover all individuals with LEP. However, this formula 
would cover a significant majority (over 93 percent) of individuals 
with LEP, even for covered entities that operate on a national 
level.\93\
---------------------------------------------------------------------------

    \93\ U.S. Census Bureau, Am. Community Survey 5-Year Estimates 
Public Use Microdata Sample 2020 for the 50 States and DC (2000), 
ACS 5-Year Estimates Public Use Microdata Sample 50 States & DC; 
https://data.census.gov/mdat/#/search?ds=ACSPUMS5Y2020&cv=ENG&rv=ucgid,LANP&wt=PWGTP&g=0400000US01,02,04,05,06,08,09,10,11,12,13,15,16,17,18,19,20,21,22,23,24,25,26,27,28,29,30,31,32,33,34,35,36,37,38,39,40,41,42,44,45,46,47,48,49,50,51,53,54,55,56.
---------------------------------------------------------------------------

    Thus, while OCR appreciates the request to increase the number of 
languages into which the Notice of Availability must be translated, we 
have determined that this would likely increase burdens while yielding 
additional coverage of marginally few individuals with LEP. However, 
covered entities are reminded that they must still take reasonable 
steps to provide meaningful access to all individuals with LEP, 
regardless of whether the individual's primary language is one of the 
15 most frequently spoken non-English languages in their State or 
States, per Sec.  92.201. Further, nothing in this rule prevents 
jurisdictions from requiring that the Notice of Availability be 
translated into more languages; covered entities wishing to provide 
more languages may also do so.
    OCR recognizes concerns raised in the comments regarding the 
potential cost of translating the Notice of Availability into the 
required languages. To offset this concern, OCR has provided 
translations of the model Notice of Availability in the top 15 
languages in each State, at www.hhs.gov/1557. Additionally, Sec.  
92.11(c) reduces the number of documents for which provision of the 
translated notices is required from the 2016 Rule, and Sec.  92.11(d) 
provides two options for how a covered entity may otherwise meet the 
requirements of this provision. OCR anticipates that efficiencies 
created by this formula--complemented by the availability of OCR-
translated Notices of Availability--will benefit covered entities and 
the communities they serve. These benefits will reduce harmful impacts 
of the failure to take reasonable steps to provide meaningful access--
such as unnecessary hospital readmissions, lower rates of outpatient 
follow up, limited use of preventive services, poor medication 
adherence, and lack of understanding of discharge

[[Page 37569]]

instructions \94\--thereby alleviating burdens on community 
organizations that have been providing notice of language access as 
well as providers who have seen negative impacts such as increased 
costs and sicker patients since the repeal of the 2016 Rule's notice 
requirements. See 87 FR 47853-54. Given these efforts, the requirement 
of providing notice of language access rights is not overly burdensome 
when balanced with the need to provide notice of the availability of 
language assistance services to individuals with LEP.
---------------------------------------------------------------------------

    \94\ See Neelam H. Ahmed et al., Moderation of the Association 
Between Primary Language and Health by Race and Gender: An 
Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 
(2022), https://www.mdpi.com/1660-4601/19/13/7750.
---------------------------------------------------------------------------

    Comment: A few commenters suggested that a hybrid method should be 
used to calculate which languages are required for translation under 
this provision, such as the higher or lower of a percentage or absolute 
number (for example, a threshold of five percent or 1,000 individuals 
with LEP, whichever is lower). Some commenters recommended OCR adopt 
the standard found in Tri-Departmental regulations at 26 CFR 54.9815-
2719(e), 29 CFR 2590.715-2719(e), and 45 CFR 147.136(e), which applies 
a county-level formula and is applicable to the internal claims and 
appeals and external review processes for group health plans and health 
insurance issuers in the group and individual health insurance markets, 
to decrease costs and avoid confusion. Some added that a hybrid method, 
such as allowing for calculations at the county- instead of State-
level, is especially critical for small practices operating at only the 
county level. They stated these practices may not have resources to 
translate the Notice of Availability into the top 15 languages spoken 
in the State and may serve language communities that are different from 
those represented by the top 15 languages at the State-level.
    Response: OCR appreciates these suggestions but, as we discussed in 
the Proposed Rule, OCR declined to adopt a population threshold due to 
variances among urban and rural communities. 87 FR 47855. We are 
concerned about similar results if a percentage threshold is used, and 
we decline to adopt this approach.
    While OCR appreciates that some covered entities will have to 
comply with both OCR and Tri-Departmental regulations, we decline to 
adopt the county-level formula found in the referenced Tri-Departmental 
regulations, 26 CFR 54.9815-2719(e), 29 CFR 2590.715-2719(e), and 45 
CFR 147.136(e), which provides that a non-English language is an 
applicable non-English language if ten percent or more of the 
population residing in the county is literate only in the same non-
English language, as section 1557 applies to a wider range of covered 
entities, communications, and individuals with LEP. We will continue to 
monitor issues related to this area and work with CMS as appropriate in 
the future to ensure compliance.
    Comment: Some commenters suggested that OCR work with covered 
entities and community groups to develop additional effective ways to 
inform individuals with LEP about their language access rights. A 
health insurance entity suggested convening a stakeholder process to 
develop and test a pilot with easy-to-understand, universal language 
access symbols to connect persons with LEP to language assistance 
services.
    Response: OCR appreciates this recommendation and welcomes the 
opportunity to collaborate with covered entities and community groups 
to develop effective means for informing individuals with LEP of their 
language access rights.
    Comment: Many commenters supported the list of documents requiring 
a Notice of Availability in Sec.  92.11(c), emphasizing the critical 
importance of clear communications in health care settings. Some 
commenters noted the provision fills information gaps and that 
receiving information multiple times is sometimes needed for effective 
notice, particularly for older adults. Others expressed support for the 
balanced approach of including opt-out provisions so that covered 
entities are not overly burdened, but participants and beneficiaries 
know their rights. Several commenters urged OCR to add medical bills to 
the list, providing examples of negative impacts of bills being sent 
without notice of how to access effective communication.
    Many other commenters expressed concerns about administrative 
burdens and costs of notice in relation to the number of communications 
in which the Notice of Availability would be required under Sec.  
92.11(c), while others pointed out that the list is effectively shorter 
than in the past.
    Several commenters wrote generally about language assistance 
services and auxiliary aids and services, with some asking for 
flexibility in the language access rules to allow for translation of 
the most important documents with the provision of oral interpretation 
for other information. Another argued that translation and 
interpretation as well as auxiliary aids and services rules should not 
apply to physician practices or health centers. Others requested that 
health insurance issuers or the Federal Government reimburse providers 
for disseminating these items.
    Response: We appreciate the comments and believe that the list of 
documents identified in Sec.  92.11(c), which provides clarity and 
prioritizes inclusion of the Notice of Availability in critical health 
care documents, strikes the appropriate balance between potential 
burdens to covered entities and the benefits to individuals with LEP 
and individuals with disabilities. OCR appreciates commenters raising 
concerns regarding the accessibility of medical billing, which can have 
long-term negative financial impacts on patients.\95\ Similarly, 
accessible notices of expected costs and benefits, such as the good 
faith estimate, can help patients make informed, cost-conscious 
decisions about their care and reduce the risk of unexpected medical 
bills.\96\ The potential financial impact of making these estimates 
accessible is particularly significant for individuals with LEP and 
individuals with disabilities who are uninsured (or self-pay), because 
these individuals have the right to dispute medical bills that are 
substantially in excess of the expected charges on their good faith 
estimate \97\ and exercise of this right depends on the ability of such 
individuals to understand both their good faith estimates and their 
medical bills. For these reasons, we are adding Sec.  92.11(c)(5)(ix), 
which requires a covered entity to provide its Notice of Availability 
along with billing-related documents and reads: ``Communications 
related to the cost and payment of care with respect to an individual, 
including medical billing and collections materials, and good faith 
estimates required by section 2799B-6 of the Public Health Service 
Act.''
---------------------------------------------------------------------------

    \95\ See NPR, Lauren Weber & Hannah Recht, Medical Bills Remain 
Inaccessible for Many Visually Impaired Americans, Health, Inc. 
(Dec. 1, 2022), https://www.npr.org/sections/health-shots/2022/12/01/1139730806/blind-disability-accessibility-medical-bills 
(discussing an investigative news report and including an OCR 
investigation).
    \96\ Internal Revenue Code section 9816(f), ERISA section 
716(f), and PHS Act section 2799A-1(f), as added by section 111 of 
title I of division BB of the Consolidated Appropriations Act, 2021 
(CAA); PHS Act section 2799B-7, as added by section 112 of title I 
of division BB of the CAA; 45 CFR 149.610.
    \97\ PHS Act section 2799B-6, as added by section 112 of title I 
of division BB of the CAA; 45 CFR 149.620.
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    Comment: Regarding an alternative, optional means of compliance at 
Sec.  92.11(d), one covered entity commenter requested that OCR specify 
that entities in compliance with other

[[Page 37570]]

Department requirements related to language access and auxiliary aids 
are deemed to have complied with section 1557. One commenter stated 
that the Notice of Availability should be combined with the Notice of 
Nondiscrimination, as well as HIPAA notices; another suggested OCR work 
with CMS and other HHS agencies to leverage existing practices and make 
these requirements technically operational.
    Response: As discussed elsewhere, OCR appreciates that covered 
entities may have compliance requirements under other Department 
regulations similar to those found in this provision. However, given 
the range of health programs and activities to which section 1557 and 
the part apply--including those where inaccessible communication can 
have life-or-death consequences--it is imperative to have an 
independent requirement. Covered entities' compliance with Sec.  
92.11(b) will increase the likelihood of compliance with similar 
Department translation requirements. While we appreciate commenters' 
suggestion to combine the Notice of Availability with the Notice of 
Nondiscrimination and the HIPAA notices, Sec.  92.11(c)(5) requires the 
Notice of Availability to additionally be included with a list of 
important health care documents because the ability of patients to 
avail themselves of language access services is foundational to 
improving health outcomes for individuals with LEP. OCR will therefore 
maintain this requirement under Sec.  92.11(c)(5) for covered entities.
    Comment: Various commenters expressed support for the alternate 
compliance provisions found in Sec.  92.11(d). One group raised the 
idea of an ``opt-in'' provision, in which individuals with LEP would 
have to state that they want Notice of Availability, in lieu of the 
proposed opt-out provision, and sought clarification about whether the 
opt-out provision can be combined with Notice of Availability.
    Some commenters argued that the alternate compliance options could 
be difficult to implement and lead to additional costs, cause 
confusion, or be generally burdensome, with one commenter stating they 
would be more burdensome than the 2016 Rule requirements because they 
require customizing documents. One commenter requested OCR delay 
implementation of the opt-out provision until 2024; other commenters 
suggested replacing the option with a less burdensome approach, asking 
that it be only electronic.
    On the other hand, commenters stated that the opt-out provision 
strikes a reasonable balance that is effectively narrower than the 2016 
Rule's ``significant communications'' requirement. Another commenter 
agreed, commenting that the proposal could be both more consumer 
friendly and helpful, as well as less duplicative and costly than the 
2016 Rule. One commenter encouraged OCR to provide robust oversight of 
opt-out processes in order to protect civil rights.
    Response: OCR appreciates the range of comments received on this 
new provision. We emphasize that the options included in Sec.  92.11(d) 
are options, and not requirements. Thus, we appreciate that covered 
entities may wish to have a delayed applicability date, to pursue these 
options only through electronic means, or not pursue them at all. OCR 
is not requiring any actions under Sec.  92.11(d) be taken; rather, OCR 
is providing alternate means to satisfy the requirements of Sec.  92.11 
without including the full Notice of Availability with all 
communications listed at Sec.  92.11(c).
    OCR declines to make further changes clarifying that a person 
should only be asked about their language needs once, because Sec.  
92.11(d)(1) permits this if the individual exercises the option to opt-
out. Moreover, Sec.  92.11(d)(2) allows a covered entity to document an 
individual's primary language, any appropriate auxiliary aids and 
services, and to communicate with them in that manner.
    OCR intends to provide robust review of opt-outs, as well as 
technical assistance, to ensure that covered entities that choose to 
exercise this option do so in a manner consistent with the requirements 
at Sec.  92.11(d).
    Comment: Many commenters submitted recommendations to increase 
guarantees of accessibility of the Notice of Availability for 
individuals with disabilities, such as requiring that: (1) notices be 
provided in large sans serif print, at a minimum of 18-point font; (2) 
notices be on the first page or otherwise at the beginning of documents 
or publications; (3) the needs of persons who are illiterate be taken 
into account through provision of audio or video notices; (4) all 
written notices be in plain language (fourth grade reading level), 
accompanied by visual aids when practicable; and (5) notice should be 
provided via audio, video, and American Sign Language. A coalition also 
discussed recommendations to ensure effective communication. Other 
accommodations recommended included: (1) screen readers and audio/video 
accessibility; (2) alternatives to braille (e.g., large print, 
qualified reader) because braille may not be economically feasible for 
all entities; (3) accessible tagline requirements or cross-references 
to language access rights; and (4) ``Easy Read'' text, images, brief 
sentences, large and simple fonts, and location on the first page.
    Many also commented that the Notice of Availability should be 
posted where frontline employees can readily see it, that employees 
should be trained to provide it, and that it be available upon request. 
Various commenters urged that covered entities must proactively ask 
people if they have communications barriers. Further, commenters stated 
that primary consideration should be given to what a person with a 
disability asks for in terms of auxiliary aids or services. Another 
commenter added that provision of the notice should be clarified so it 
applies to listening devices and the other range of auxiliary aids.
    Response: OCR appreciates all the suggestions and reminds 
commenters and others that the meaningful access and effective 
communication requirements (Sec. Sec.  92.201 and 92.202, respectively) 
regarding the provision of language access and auxiliary aids apply to 
the Notice of Availability. Covered entities have existing effective 
communication obligations under section 504 and section 1557, which may 
include providing the notice in an alternate format or providing 
another auxiliary aid or service. Thus, if an individual is in need of 
the notice in an alternate format or through another auxiliary aid or 
service, that would likely already be required when it is necessary to 
ensure effective communication. We decline to affirmatively require the 
notice be provided in any additional formats at this time. However, OCR 
agrees that larger print should be required to ensure the accessibility 
of the Notice of Availability when posted in physical locations, and 
that this requirement is relatively straightforward to implement; 
accordingly, Sec.  92.11(c)(4) has been amended to require print no 
smaller than 20-point in a sans serif font.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.11, with modifications. We are revising Sec.  92.11(b) to 
clarify the relevant State or States are those ``in which a covered 
entity operates.'' We are modifying Sec.  92.11(c)(4) to clarify that 
posted notices be provided ``in no smaller than 20-point sans serif 
font.'' We are adding

[[Page 37571]]

Sec.  92.11(c)(5)(ix) to read: ``Communications related to the cost and 
payment of care with respect to an individual, including medical 
billing and collections materials, and good faith estimates required by 
section 2799B-6 of the Public Health Service Act.'' We are also making 
technical revisions, including replacing ``limited English proficient 
individual'' with ``individual with limited English proficiency,'' 
consistent with modifications elsewhere.
Data Collection
    We solicited comments on requiring covered entities to collect 
additional data, beyond those required by the referenced statutes and 
their regulations, on race, ethnicity, language, sex, gender, gender 
identity, sexual orientation, disability, and age, to inform a final 
rule and OCR's overall civil rights work.
    We also sought comment on whether covered entities are already 
collecting disaggregated demographic data in their health programs and 
activities and, if so, for which categories of data, through what 
systems, and at what cost. We also invited comment on how a section 
1557 civil rights data collection requirement could impact current data 
collection efforts, either positively or negatively. We also requested 
comment on whether the adoption of a regulatory standard for a 
recurring civil rights data collection would benefit civil rights 
enforcement, as well as how frequently the data should be submitted to 
OCR. We also sought comment on whether the data collection requirements 
should vary by type of entity, as recipients of Federal financial 
assistance include a variety of entities, including State and local 
agencies, health insurance issuers, providers, health care facilities 
and clinics, hospitals, Federally Qualified Health Centers, and health-
related educational and training programs. Accordingly, we invited 
comment on which types of recipients (if any) should be covered; if 
recipients under a certain size should be exempt from the data 
collection requirement, and if so, whether that exemption should be 
based on employee number, the number of beds (if relevant), or some 
other metric; what types of data should be collected; what definitions 
should be used; the potential costs associated with such a requirement; 
and the potential benefits of such a requirement.
    The comments and our responses regarding data collection are set 
forth below.
    Comment: Some commenters recommended that OCR not mandate the 
collection of data, with some strongly suggesting that we minimize 
provider burden and utilize existing data collection systems.
    Response: OCR is not including a data collection requirement in the 
final rule. OCR has the authority independent of this rulemaking to 
conduct data calls to ensure recipient compliance with Federal civil 
rights laws.\98\ OCR is actively engaged with other agencies within the 
Department and throughout the Federal Government related to responsible 
data collection and recognizes the importance of data collection to 
meet its mission. We will continue to work with covered entities and 
beneficiaries to determine whether an additional data collection 
requirement is needed in a future rulemaking.
---------------------------------------------------------------------------

    \98\ See, e.g., 45 CFR 80.6(b).
---------------------------------------------------------------------------

    Comment: Some commenters recommended that OCR adopt data collection 
standards. They noted that with any demographic data collection 
requirement, OCR must provide appropriate training and technical 
assistance resources to programs and grantees and make clear that data 
cannot be used for negative actions such as immigration or law 
enforcement, redlining, or targeting of specific groups.
    Response: OCR appreciates the comments regarding standards and 
safeguards to ensure that programs and grantees have the appropriate 
training. OCR also understands the concerns that some commenters have 
regarding data being used for adverse actions. While OCR is not 
including a data collection requirement in the final rule, OCR will 
continue to research the benefits of civil rights data collection and 
how to mitigate potential negative impacts.
    Comment: Some commenters urged OCR to require covered entities to 
collect data regarding a core set of disaggregated categories to 
include race, ethnicity, language, sex, gender, gender identity, sexual 
orientation, pregnancy status, sex characteristics, disability, and age 
from patients and providers. Commenters stated that data are essential 
to identify and address unmet needs, and for many populations data 
remain largely uncollected. Some commenters also noted that collecting 
disaggregated data could allow OCR to distinguish the impact of 
intersectional discrimination on those seeking access to health care. 
Some commenters also urged that if individuals volunteer such 
information, it should be self-reported to ensure accuracy and privacy.
    Response: OCR agrees that better standards and practices for 
collecting data can have a positive impact on reducing disparities. OCR 
will continue to work to ensure that any civil rights data collection 
yields accurate data that adequately protects the privacy of 
individuals.
Summary of Regulatory Changes
    For the reasons set forth above and considering the comments 
received, we are finalizing the rule without a data collection 
provision.

Subpart B--Nondiscrimination Provisions

    In subpart B, OCR proposed provisions related to the prohibition of 
discrimination on the basis of race, color, national origin, sex, age, 
and disability in covered health programs and activities.
Discrimination Prohibited (Sec.  92.101)
    In Sec.  92.101(a), we proposed a general prohibition of 
discrimination on the basis of race, color, national origin, sex, age, 
or disability under any health program or activity to which section 
1557 or the part applies and provided additional detail regarding what 
constitutes discrimination on the basis of sex.
    In Sec.  92.101(a)(1), we proposed general prohibitions on 
discrimination under section 1557 by restating the core objective of 
section 1557. In Sec.  92.101(a)(2), we clarified that discrimination 
on the basis of sex includes discrimination on the basis of sex 
stereotypes; sex characteristics, including intersex traits; pregnancy 
or related conditions; sexual orientation; and gender identity.
    In Sec.  92.101(b), we identified several specific forms of 
prohibited discrimination under section 1557. Proposed Sec.  
92.101(b)(1)(i) specifically referred to recipients of Federal 
financial assistance and State Exchanges; proposed Sec.  
92.101(b)(1)(ii) referred to the Department's health programs and 
activities, including Federally-facilitated Exchanges.
    In Sec.  92.101(b)(2), we proposed that the enumeration of specific 
forms of discrimination in 92.101(b) does not limit the general 
application of the prohibition in proposed Sec.  92.101(a).
    The comments and our responses regarding Sec.  92.101 are set forth 
below.
    Comment: Numerous commenters supported the Proposed Rule's 
nondiscrimination provisions, stating that these provisions would 
promote the health equity for communities of color and increase access 
to coverage and care for those who have been historically underserved 
because of race, ethnicity, language, age, disability, and sex. Many 
commenters stated that OCR should finalize the provisions without 
delay.

[[Page 37572]]

Another commenter supported the proposed discrimination prohibitions as 
consistent with the ACA, and another requested that more support be 
provided for educating the public about the nondiscrimination 
obligations of health programs and activities.
    Response: OCR agrees that the nondiscrimination provisions are one 
important tool to address health disparities and advance health equity. 
OCR will continue to provide technical assistance and public education 
related to compliance with section 1557 and encourages covered entities 
to continue to visit our website for technical assistance materials.
    Comment: Numerous commenters stated that section 1557's explicit 
prohibition on discrimination based on multiple grounds fills a 
critical gap by protecting patients who may experience multiple forms 
of discrimination. Commenters provided numerous examples of 
simultaneous discrimination on more than one protected basis, 
including, but not limited to, discrimination against LGBTQI+ 
individuals of color, with disabilities, with LEP, or who are 
immigrants; and Black and Hispanic/Latino older adults. Numerous 
commenters recommended that OCR revise Sec.  92.101(a)(1) to include 
``or any combination thereof'' to explicitly account for intersectional 
discrimination within the regulatory text.
    Response: OCR agrees that simultaneous discrimination on multiple 
prohibited bases, is important to account for and is prohibited by 
section 1557. As we noted in the Proposed Rule, a recent study examined 
disability and pregnancy as intersecting traits and how this may impact 
risk for maternal morbidity and mortality, underscoring the importance 
of ensuring nondiscrimination against women with disabilities. 87 FR 
47837. The Proposed Rule also provided information regarding Black 
maternal health and the alarming disparities in maternal mortality 
rates for Black women and American Indian/Alaska Native women. 87 FR 
47832.
    Therefore, to account for the fact that individuals can experience 
discrimination based on two or more protected bases (race, color, 
national origin, sex, age, and disability), we have amended the 
language of Sec.  92.101(a)(1) to include ``or any combination 
thereof.'' This language has also been amended throughout the final 
rule for consistency. The addition intends to clarify that an 
individual is protected from discrimination on more than one protected 
basis that occurs at the same time.
    Comment: A commenter provided a discussion of the harms and 
unaddressed discrimination faced by patients with rare diseases and 
requested that OCR explicitly prohibit discrimination against patients 
with rare diseases. Some commenters requested that specific recognition 
also be made for patients with liver diseases. A commenter requested 
that the proposed regulatory text or accompanying guidance provide 
examples of discrimination on the basis of disability.
    Response: Discrimination against an individual with a rare or 
specific disease that meets the definition of ``disability'' will be 
addressed under section 1557's prohibition on discrimination on the 
basis of disability, which already appears in the rule. The commenter's 
request for further guidance will be taken into consideration. For 
additional information related to disability discrimination, please see 
the discussions under subpart C. OCR also provides guidance and 
examples, as well as answers to frequently asked questions related to 
disability discrimination on our website.
    Comment: A number of commenters asked that vaccination status be 
added as a ground of prohibited discrimination, stating that their 
right to make their own health care decisions should be protected.
    Response: Section 1557 prohibits discrimination on the basis of 
race, color, national origin, sex, age, and disability. To the extent 
vaccination status is not related to these prohibited bases of 
discrimination specified by Congress in section 1557, we decline to 
include it as a ground of prohibited discrimination under this rule.
    Comment: Some tribal organizations recommended that OCR acknowledge 
American Indian/Alaska Native (AI/AN) people as holding a political 
classification as compared to a race-based classification and to exempt 
Tribal health programs from the final rule. These commenters stated 
that recognizing the political classification of AI/AN people allows 
AI/AN providers to only serve AI/AN patients, which commenters said is 
necessary because of logistical capacity constraints.
    Response: As discussed at Sec.  92.2, OCR recognizes the unique 
relationship between the United States and federally recognized tribal 
entities. Federal Government preferences based on an individual's 
membership or eligibility in a federally recognized tribal entity are 
based on political classifications. Such classifications are not race-
based. As such, preferences on this basis do not violate the Equal 
Protection Clause,\99\ title VI,\100\ or section 1557. As discussed at 
Sec.  92.2, preferences based on the unique relationship between the 
United States and federally recognized Tribes are distinct from the 
protections afforded under Federal civil rights laws, which protect all 
individuals from discrimination on the basis of race, color, or 
national origin (including AI/AN individuals, regardless of tribal 
enrollment or affiliation). This final rule adopts by reference the 
Department's title VI regulatory provision at 45 CFR 80.3(d), which 
provides that an individual shall not be deemed subjected to 
discrimination by reason of their exclusion from benefits limited by 
Federal law--such as the Indian Health Service--to individuals of a 
different race, color, or national origin. OCR will fully apply this 
provision as well as other applicable exemptions or defenses that may 
exist under Federal law. OCR intends to address any restrictions on 
application of section 1557 to Tribal entities in the context of 
individual complaints or compliance reviews.
---------------------------------------------------------------------------

    \99\ See Morton v. Mancari, 417 U.S. 535 (1974).
    \100\ 45 CFR 80.3(d).
---------------------------------------------------------------------------

    Comment: A commenter suggested that nondiscrimination protections 
should be extended to health care workers, indicating that health care 
workers often experience discrimination, especially on the basis of 
race and that additional protections are needed.
    Response: While OCR acknowledges that health care workers can face 
discrimination as they provide health care, OCR does not have 
jurisdiction over patients who may discriminate against health care 
workers, as patients are not covered entities under section 1557. 
Separately, and as previously noted, OCR does not intend for this rule 
to apply to employment discrimination. If OCR receives a complaint from 
a health care worker, we will determine if we have jurisdiction to 
investigate. Complaints received by OCR from health care workers 
alleging discrimination experienced in the context of employment will 
be referred to an appropriate agency, per Sec. Sec.  92.303(b) and 
92.304(a) (incorporating 45 CFR 85.61(e)), as this regulation does not 
apply to employment practices.
    Comment: Many commenters expressed support for the explicit 
references to discrimination on the basis of sex stereotypes; sex 
characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; and gender identity as forms of

[[Page 37573]]

discrimination on the basis of sex in Sec.  92.101(a)(2). Commenters 
pointed to evidence of health disparities and barriers to accessing 
health care faced by LGBTQI+ people, and how ongoing health care 
discrimination contributes to higher rates of substance use, mental 
health conditions, HIV, cancer, and cardiovascular disease for LGBTQI+ 
people relative to non-LGBTQI+ people.\101\ Several commenters stated 
that Sec.  92.101(a)(2)'s prohibitions should be mirrored in the CMS 
regulations addressed in section IV.
---------------------------------------------------------------------------

    \101\ See, e.g., Charlotte Patterson et al., Nat'l Acads. of 
Sci., Eng'g, & Med., Understanding the Well-Being of LGBTQI+ 
Populations (2020), https://doi.org/10.17226/25877; Lambda Legal, 
When Health Care Isn't Caring: Lambda Legal's Survey of 
Discrimination Against LGBT People and People with HIV (2010), 
www.lambdalegal.org/health-care-report; Cornell Univ., What Does the 
Scholarly Research Say about the Effects of Discrimination on the 
Health of LGBT People? (2019), https://whatweknow.inequality.cornell.edu/topics/lgbt-equality/what-does-scholarly-research-say-about-the-effects-of-discrimination-on-the-health-of-lgbt-people/.
---------------------------------------------------------------------------

    Response: It is well documented that LGBTQI+ people face 
significant health disparities and barriers to health care and 
insurance coverage,\102\ and section 1557's protections are critical 
tools to combat those disparities. We appreciate commenters' view that 
CMS regulations within this rulemaking should mirror the language 
provided in Sec.  92.101(a)(2), and we refer readers to section IV (CMS 
Amendments).
---------------------------------------------------------------------------

    \102\ See, e.g., Sharita Gruberg et al., Ctr. for Am. Progress, 
The State of the LGBTQ Community in 2020 (2020), https://www.americanprogress.org/issues/lgbtq-rights/reports/2020/10/06/491052/state-lgbtq-community-2020/; Sandy E. James et al., Nat'l 
Ctr. for Transgender Equality, The Report of the 2015 U.S. 
Transgender Survey, p. 97 (2016), https://transequality.org/sites/default/files/docs/usts/USTS-Full-Report-Dec17.pdf. See also 
Caroline Medina et al., Ctr. For Am. Progress, Discrimination and 
Barriers to Well-Being: The State of the LGBTQI+ Community in 2022 
(2023), https://www.americanprogress.org/article/discrimination-and-barriers-to-well-being-the-state-of-the-lgbtqi-community-in-2022/.
---------------------------------------------------------------------------

    Comment: A number of comments addressed discrimination in the 
context of organ transplantation. Several commenters noted that people 
with disabilities are routinely denied access to organ transplants due 
to stereotypical assumptions about compliance with post-operative care 
and policies that deny transplants to otherwise eligible individuals 
with disabilities.\103\
---------------------------------------------------------------------------

    \103\ See Nat'l Council on Disability, Organ Transplant 
Discrimination Against People with Disabilities (2019), https://www.ncd.gov/assets/uploads/reports/2019/ncd_organ_transplant_508.pdf.
---------------------------------------------------------------------------

    Several commenters noted that existing practices in organ 
transplants appear to discriminate against Black, Hispanic/Latino, and 
Native American/Alaska Native individuals, as those individuals are 
more likely to develop end stage renal disease but are less likely to 
receive a kidney transplant than white individuals.\104\ Another 
commenter stated that providers may discriminate against immigrant 
patients during the assessment process by assuming they lack social 
support or the ability to care for themselves after organ 
transplantation, resulting in a denial of care.\105\
---------------------------------------------------------------------------

    \104\ See U.S. Renal Data System, 2021 Annual Report: End Stage 
Renal Disease ch. 1 (2021) (Figure 1.8); Hannah Wesselman et al., 
Social Determinants of Health and Race Disparities in Kidney 
Transplant, 16 Clin. J. Am. Soc'y Nephrol. 262, 262 (2021).
    \105\ See Garyphallia Poulakou, Oscar Len & Murat Akova, 
Immigrants as Donors and Transplant Recipients: Specific 
Considerations, 45 Int. Care Med. 401 (2019), https://pubmed.ncbi.nlm.nih.gov/30701293/.
---------------------------------------------------------------------------

    Response: Discrimination on the basis of disability and race in the 
provision of health care, including organ transplantation, is a 
continuing issue that limits opportunities for life-saving treatment. 
This final rule provides OCR with a powerful tool to help address this 
ongoing issue. While section 1557 does not prohibit discrimination on 
the basis of immigration status, section 1557's protections apply 
regardless of someone's citizenship or immigration status, and 
individuals who believe they have been discriminated against based on 
certain characteristics such as race, color, and national origin can 
file a complaint. We will continue to address discrimination in organ 
transplantation through robust enforcement of not only section 1557, 
but all Federal civil rights laws.\106\
---------------------------------------------------------------------------

    \106\ See, e.g., U.S. Dep't Health & Hum. Servs., Off. for Civil 
Rts., OCR Resolves Disability Complaint of Individual Who Was Denied 
the Opportunity for Health Transplant List Placement (Feb. 12, 
2019), https://www.hhs.gov/about/news/2019/02/12/ocr-resolves-disability-complaint-individual-who-was-denied-opportunity-heart-transplant-list.html.
---------------------------------------------------------------------------

    Comment: Numerous commenters generally supported the inclusion of 
the prohibition of discrimination on the basis of gender identity and 
sexual orientation as prohibited types of sex discrimination in 
proposed Sec.  92.101(a)(2). They maintained that inclusion was 
consistent with Bostock v. Clayton County, 590 U.S. 644 (2020), in 
which the Supreme Court held that title VII's prohibition of 
discrimination because of sex includes discrimination on the basis of 
sexual orientation and gender identity. Commenters supported the 
application of the reasoning in Bostock to title IX by citing several 
cases, DOJ resource materials, and Executive Order (E.O.) 13988.\107\ 
Another commenter cited several cases stating that courts have treated 
title VII and title IX protections as consistent with one another in 
support of the application of Bostock to title IX.\108\ A few 
commenters cited City of Los Angeles Department of Water and Power v. 
Manhart, 435 U.S. 702 (1978), as indicating that, for decades, sex 
discrimination prohibitions have covered sex stereotypes. The 
commenters also cited several opinions from district courts and one 
appellate court as indicating that discrimination on the basis of 
gender identity, gender transition, sex stereotypes, or transgender 
status are, similarly, unlawful types of sex discrimination.\109\ Other 
commenters provided cites to numerous other cases as including gender 
identity and sexual orientation as characteristics protected by sex 
discrimination law.\110\
---------------------------------------------------------------------------

    \107\ E.O. 13988, 86 FR 7023 (Jan. 25, 2021). U.S. Dep't of 
Justice, Title IX Legal Manual, https://www.justice.gov/crt/title-ix. See, e.g., Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 
616-17 (4th Cir. 2020), as amended (Aug. 28, 2020), reh'g en banc 
denied, 976 F. 3d 399 (4th Cir. 2020), cert. denied, No. 20-1163 
(June 28, 2021); B.P.J. v. W. Va. State Bd. of Educ., No. 2:21-CV-
00316, 2021 WL 3081883, at *7 (S.D.W. Va. July 21, 2021); Koenke v. 
Saint Joseph's Univ., No. CV 19-4731, 2021 WL 75778, at *2 (E.D. Pa. 
Jan. 8, 2021); Doe v. Univ. of Scranton, No. 3:19-CV-01486, 2020 WL 
5993766, at *11 n.61 (M.D. Pa. Oct. 9, 2020).
    \108\ See, e.g., Doe v. Snyder, 28 F.4th 103, 113-14 (9th Cir. 
2022); Emeldi v. Univ. of Or., 698 F.3d 715, 725 (9th Cir. 2012); 
Franklin v. Gwinnett Cnty. Pub. Sch., 503 U.S. 60, 75 (1992); Grimm 
v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th Cir. 2020).
    \109\ See Kadel v. Folwell, 620 F. Supp. 3d 339, 379 (M.D.N.C. 
2022); Fain v. Crouch, 618 F .Supp. 3d 313, 326-27 (S.D.W. Va. 
2022); Fletcher v. Alaska, 443 F. Supp. 3d 1024, 1027, 1030 (D. 
Alaska 2020); Flack v. Wisconsin Dep't of Health Servs., 395 F. 
Supp. 3d 1001, 1019-22 (W.D. Wis. 2019); Boyden v. Conlin, 341 F. 
Supp. 3d 979, 1002-03 (W.D. Wis. 2018); Cf. Brandt by & through 
Brandt v. Rutledge, 2022 WL 3652745, at *2 (8th Cir. Aug. 25, 2022).
    \110\ See, among others cited, Grimm v. Gloucester Cnty. Sch. 
Bd., 972 F.3d 586, 593, 616, 619 (4th Cir. 2020), reh'g en banc 
denied, 976 F.3d 399 (4th Cir. 2020); Whitaker v. Kenosha Unified 
Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, 1049-50 (7th Cir. 
2017); Fain v. Crouch, No. 3:20-0740, 2022 U.S. Dist. LEXIS 137084, 
at *35-36 (S.D. W. Va. Aug. 2, 2022); Scott v. St. Louis Univ. 
Hosp., No. 4:21-cv-01270-AGF, 2022 U.S. Dist. LEXIS 74691, at *18 
(E.D. Mo. Apr. 25, 2022); C.P. v. Blue Cross Blue Shield of Ill., 
536 F. Supp. 3d 791, 793 (W.D. Wash. 2021); Flack v. Wis. Dep't of 
Health Servs., 395 F. Supp. 3d 1001, 1014-15 (W.D. Wis. 2019); 
Boyden v. Conlin, 341 F. Supp. 3d 979, 997, 1002-03 (W.D. Wis. 
2018); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 953 (D. Minn. 
2018); Prescott v. Rady Children's Hosp.-San Diego, 265 F. Supp. 3d 
1090, 1098-1100 (S.D. Cal. 2017); Adams v. Sch. Bd. of St. Johns 
Cnty., 968 F.3d 1286, 1305 (11th Cir. 2020); Zarda v. Altitude 
Express, Inc., 883 F.3d 100, 112-13 (2nd Cir. 2018); Franchina v. 
Providence, 881 F.3d 32, 53-54 (1st Cir. 2018); Hively v. Ivy Tech, 
853 F.3d 339, 340-41 (7th Cir. 2017).
---------------------------------------------------------------------------

    Conversely, several commenters stated that Bostock does not support 
Sec.  92.101(a)(2) as written. Some commenters stated that Bostock 
defined sex to include only ``biological distinctions between male and 
female'' and used the term ``transgender status''

[[Page 37574]]

rather than ``gender identity.'' A commenter argued that title VII 
should be treated as distinct from title IX because title IX uses the 
term ``on the basis of sex''--language the commenter described as 
requiring more than ``but for causation''--while title VII uses 
``because of . . . sex.'' Other commenters discussed title IX to 
support arguments that discrimination on the basis of sex does not 
include discrimination on the basis of sexual orientation or gender 
identity, and that title IX only protects people on the basis of 
``biological sex.''
    Some commenters cited to various cases in opposition to the 
inclusion of gender identity and sexual orientation in proposed Sec.  
92.101(a)(2), including State of Tennessee v. Department of Education, 
615 F. Supp. 3d 807 (E.D. Tenn. 2022), to support the belief that 
agencies cannot rely on the reasoning in Bostock to interpret what 
constitutes sex discrimination under title IX. Another commenter stated 
that E.O. 13988 improperly expands the application of Bostock and cited 
Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016) in 
support. Some commenters stated that RFRA's religious protections may 
supersede the sex discrimination protections described in Bostock, and 
one commenter cited Hosanna-Tabor Evangelical Lutheran Church and 
School v. EEOC, 565 U.S. 171 (2012), for the proposition that that 
First Amendment protections may supersede employment discrimination 
laws. Another commenter stated that OCR's interpretation of what is 
prohibited sex discrimination is contrary to law, citing to Franciscan 
Alliance, Inc. v. Becerra \111\ and Christian Employers Alliance v. 
EEOC.\112\
---------------------------------------------------------------------------

    \111\ 553 F. Supp. 3d 361 (N.D. Tex. 2021), amended, No. 7:16-
cv-00108-O, 2021 WL 6774686 (N.D. Tex. Oct. 1, 2021), appeal 
docketed, No. 21-11174 (5th Cir. Nov. 26, 2021); see also Franciscan 
All., Inc. v. Becerra, 47 F.4th 368 (5th Cir. 2022).
    \112\ Christian Emp'rs All. v. EEOC, No. 21-cv-00195, 2022 WL 
1573689 (D.N.D. May 16, 2022).
---------------------------------------------------------------------------

    Response: Case law offers strong support for the position that sex 
discrimination under section 1557 includes discrimination on the basis 
of gender identity and sexual orientation. As previously noted, a body 
of developing case law explains how to identify unlawful sex 
discrimination. As part of its prohibition on sex discrimination, this 
rule prohibits discrimination against individuals who do not conform 
with stereotypical notions of how an individual is expected to present 
as male or female, regardless of gender identity. This is consistent 
with longstanding case law; more than 30 years ago, a plurality of the 
Supreme Court held in Price Waterhouse that discrimination based on sex 
stereotypes was a prohibited form of sex discrimination. We have 
included a number of examples throughout the preamble discussion to 
help covered entities better understand their obligations. OCR is also 
committed to providing technical assistance to support compliance with 
this final rule and may consider additional guidance that may assist 
covered entities with their obligations.
    As noted in the Proposed Rule, the inclusion of ``sexual 
orientation'' and ``gender identity'' in Sec.  92.101(a)(2) is 
consistent with the Supreme Court's reasoning in Bostock. 87 FR 47858. 
Title IX and section 1557 prohibit discrimination ``on the basis of 
sex.'' \113\ And the Bostock Court used the phrase ``because of sex'' 
and ``on the basis of sex'' interchangeably.\114\ Because the statutory 
prohibitions against sex discrimination in title VII and title IX are 
similar, the Supreme Court and other Federal courts look to 
interpretations of title VII to inform title IX.\115\ Thus, Bostock's 
discussion of the text of title VII informs the OCR's analysis of title 
IX and section 1557. Given the similarity in nondiscrimination language 
between title VII and title IX, many Federal courts that have addressed 
the issue have interpreted section 1557 and title IX consistent with 
Bostock's reasoning.\116\ Since Bostock, three Federal courts of 
appeals have held that the plain language of title IX's prohibition on 
sex discrimination must be read similarly to title VII's 
prohibition.\117\ OCR agrees with the reasoning in these cases.\118\ 
Additionally, there is a significant amount of case law, pre-and post-
Bostock that affirms that sex discrimination includes discrimination 
based on gender identity.\119\
---------------------------------------------------------------------------

    \113\ 20 U.S.C. 1681(a); 42 U.S.C. 18116.
    \114\ See, e.g., 590 U.S. 653, 662, 681.
    \115\ See, e.g., Franklin v. Gwinnett Cnty. Pub. Sch., 503 U.S. 
60, 75 (1992); Jennings v. Univ. of N.C., 482 F.3d 686, 695 (4th 
Cir. 2007); Gossett v. Okla. ex rel. Bd. Of Regents for Langston 
Univ., 245 F.3d 1172, 1176 (10th Cir. 2001).
    \116\ See, e.g., Doe v. Snyder, 28 F.4th 103, 113-14 (9th Cir. 
2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 616 (4th 
Cir. 2020); but cf. Adams v. Sch. Bd. of St. Johns Cnty, 57 F.4th 
791, 811-15 (11th Cir. 2022) (en banc)).
    \117\ See A.C. by M.C. v. Metro. Sch. Dist. Of Martinsville, 75 
F.4th 760, 769 (7th Cir. 2023); Grabowski v. Ariz. Bd. Of Regents, 
69 F.4th 1110, 1116-17 (9th Cir. 2023); Doe v. Snyder, 28 F.4th 103, 
113-14 (9th Cir. 2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 
586, 616 (4th Cir. 2020), as amended (Aug. 28, 2020), cert. denied, 
141 S. Ct. 2878 (Mem) (2020).
    \118\ OCR acknowledges that at least one court has held that it 
would be a misapplication of Bostock to interpret the definition of 
``sex discrimination'' under section 1557 and title IX to include 
gender identity and sexual orientation. In Neese v. Becerra, 640 F. 
Supp. 3d 668, the U.S. District Court for the Northern District of 
Texas held that the Department misapplied Bostock when it issued a 
public notice, 86 FR 27984 (May 25, 2021), stating that it would 
interpret section 1557 and title IX's prohibition on sex 
discrimination to include discrimination on the basis of sexual 
orientation and gender identity. The Department appealed that 
decision to the U.S. Court of Appeals for the Fifth Circuit and oral 
argument was held on January 8, 2024. The Department is not applying 
the challenged interpretation to members of the Neese class pending 
the appeal.
    \119\ See, e.g., Whitaker By Whitaker v. Kenosha Unified Sch. 
Dist. No. 1 Bd. Of Educ., 858 F.3d 1034 (7th Cir. 2017) (title IX); 
Smith v. City of Salem, Ohio, 378 F.3d 566 (6th Cir. 2004) (title 
VII); Rosa v. Park W. Bank & Trust Co., 214 F.3d 213 (1st Cir. 2000) 
(Equal Credit Opportunity Act); Schroer v. Billington, 577 F. Supp. 
2d 293 (D.D.C. 2008) (title VII); Boyden v. Conlin, 341 F. Supp. 3d 
979 (W.D. Wis. 2018) (section 1557 and title VII); Flack v. Wis. 
Dep't. of Health Servs., 395 F. Supp 3d 1001, 1014 (W.D. Wis. 2019) 
(section 1557 and Equal Protection Clause); Prescott v. Rady 
Children's Hosp. San Diego, 265 F. Supp. 3d 1090, 1098-100 (S.D. 
Cal. 2017) (section 1557); Tovar v. Essential Health, 342 F. Supp. 
3d 947, 957 (D. Minn. 2018) (section 1557). See also Doe v. Snyder, 
28 F.4th 103, 113-14 (9th Cir. 2022); Grimm v. Gloucester Cnty. Sch. 
Bd., 972 F.3d 586, 616 (4th Cir. 2020), as amended (Aug. 28, 2020), 
cert. denied, 141 S. Ct. 2878 (Mem) (2020); Kadel v. Folwell, No. 
1:19-cv-00272, 2022 WL 2106270, at *28-*29 (M.D.N.C. June 10, 2022); 
Scott v. St. Louis Univ. Hosp., No. 4:21-cv-01270-AGF, 2022 WL 
1211092, at *6 (E.D. Mo. Apr. 25, 2022); C.P. by & through Pritchard 
v. Blue Cross Blue Shield of Ill., No. 3:20-cv-06145-RJB, 2021 WL 
1758896, at *4 (W.D. Wash. May 4, 2021); Koenke v. Saint Joseph''s 
Univ., No. CV 19-4731, 2021 WL 75778, at *2 (E.D. Pa. Jan. 8, 2021); 
Doe v. Univ. of Scranton, No. 3:19-cv-01486, 2020 WL 5993766, at *11 
n.61 (M.D. Pa. Oct. 9, 2020); Maxon v. Seminary, No. 2:19-cv-9969, 
2020 WL 6305460 (C.D. Cal. Oct. 7, 2020); B.P.J. v. W. Va. State Bd. 
Of Educ., No. 2:21-cv-00316, 2021 WL 3081883, at *7 (S.D.W. Va. July 
21, 2021); Clark Cnty. Sch. Dist. V. Bryan, 478 P.3d 344, 354 (Nev. 
2020).
---------------------------------------------------------------------------

    We disagree with commenters' assertion that the Court's use of the 
term ``transgender status'' in Bostock, rather than ``gender 
identity,'' results in any meaningful distinction regarding protections 
afforded to transgender individuals or other individuals experiencing 
discrimination on the basis of their gender identity. The Court's 
choice of language reflects that it was addressing the gender identity 
of the plaintiff before it, who was transgender, and does not preclude 
the case's application to other gender identities. Indeed, even the 
dissent stated that ``there is no apparent difference between 
discrimination because of transgender status and discrimination because 
of gender identity.'' 590 U.S. at 686, n.6 (Alito, J. joined by Thomas, 
J., dissenting).
    Additional citations by those opposing the language in Sec.  
92.101(a)(2) are either not applicable, already discussed in the 
Proposed Rule, or outdated. To begin, this rule does not

[[Page 37575]]

rely on E.O. 13988 for its authority, so criticisms of that order do 
not undermine the final rule. State of Tennessee is inapposite. There, 
the court held that the plaintiffs had demonstrated a reasonable 
likelihood of success on the claim that two other Federal agencies 
violated the Administrative Procedure Act by foregoing notice-and-
comment procedures.\120\ That is not at issue here, as this is notice-
and-comment rulemaking and not the issuance of informational documents. 
Hosanna-Tabor involved First Amendment limitations on the application 
of employment discrimination laws--specifically the ``ministerial 
exception'' that precludes application of employment discrimination 
laws to ``claims concerning the employment relationship between a 
religious institution and its ministers.'' 565 U.S. at 188. As 
discussed throughout the Proposed Rule, beginning at 87 FR 47826, OCR 
is aware of and discusses both Franciscan Alliance v. Becerra and 
Christian Employers Alliance v. EEOC, and the Department is not 
prohibited from finalizing this rule by either decision. 87 FR 47826. 
Additionally, the final rule adopts new procedures for recipients 
wishing to invoke Federal religious freedom and conscience protections. 
For more on those procedures, see Sec.  92.302.
---------------------------------------------------------------------------

    \120\ Tennessee v. U.S. Dep't of Educ., 615 F. Supp. 3d 807 
(E.D. Tenn. 2022); appeal docketed, No. 22-5807 (6th Cir. Sept. 13, 
2022) (oral argument held April 26, 2023).
---------------------------------------------------------------------------

    Finally, OCR disagrees with the commenters who cited Franciscan 
Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 2016), in support 
of the view that section 1557 and title IX's prohibition on sex 
discrimination does not include discrimination on the basis of sexual 
orientation and gender identity. The legal landscape in this area has 
changed since that decision issued and the publication of the Proposed 
Rule. The Franciscan Alliance v. Burwell court concluded that the 2016 
Rule's definition of ``sex'' as including ``gender identity'' was 
contrary to section 1557 because ``Title IX and Congress' incorporation 
of it in [section 1557 of] the ACA unambiguously adopted the binary 
definition of sex.'' Id. at 689. Four years later, the Supreme Court 
held that the prohibition on discrimination ``because of . . . sex'' 
under title VII covers discrimination on the basis of gender identity 
and sexual orientation, even assuming that ``sex'' refers ``only to 
biological distinctions between male and female.'' Bostock, 590 U.S. at 
655. The Bostock Court held that the statute's prohibition on 
employment discrimination ``because of sex'' encompasses discrimination 
on the basis of sexual orientation and gender identity. Id. at 670-71.
    Comment: Several commenters generally asserted that sex is an 
immutable, biological binary. Some commenters relayed that their 
religious beliefs include that sex is an immutable binary. A commenter 
stated that sex has a biological component that impacts medical care.
    A commenter argued that if the rule does not recognize that sex is 
a biological binary, there will be increased confusion in the provision 
of medical services. Another commenter expressed concern that the rule 
would diminish the quality of health care received by some patients 
because some health conditions, such as symptoms of heart attacks, are 
based on ``biological sex characteristics.'' A commenter said that a 
prohibition of discrimination on the basis of gender identity would 
validate the recognition of gender identity and increase gender 
dysphoria.
    Response: OCR recognizes that sex has biological components and 
knowledge of an individual's biological attributes is an essential 
component of providing high quality health care for all patients. For 
example, in the Proposed Rule, we discussed the various health 
disparities experienced by women, which require that providers have 
adequate knowledge of biology and anatomy to effectively address. 87 FR 
47833-34.
    OCR disagrees with commenters suggesting that nondiscrimination 
protections on the basis of gender identity will either cause confusion 
in the medical profession or lead to diminished quality of care. Health 
care providers are highly trained in issues of biology, anatomy, and 
physiology. This rule requires that individuals be treated without 
discrimination on the basis of sex. There is no evidence that 
demonstrates that compliance with civil rights protections, including 
on the basis of sex, has caused any confusion in the medical field. On 
the contrary, evidence suggests that when patients are protected on the 
basis of sex in health care programs, quality of care improves because 
patients at risk of discrimination are more likely to seek and receive 
high quality care. For example, research shows that individuals who are 
experiencing gender dysphoria--defined by the American Psychiatric 
Association to include ``clinically significant distress or impairment 
related to gender incongruence''--have a clinically significant 
decrease in distress if they have access to medically necessary 
care.\121\
---------------------------------------------------------------------------

    \121\ Jack Turban, M.D., M.H.S., What is Gender Dysphoria?, Am. 
Psychiatric Assoc., https://www.psychiatry.org/patients-families/gender-dysphoria/what-is-gender-dysphoria (Aug. 2022).
---------------------------------------------------------------------------

    Moreover, section 1557 prohibits discrimination on certain 
prohibited bases, and does not interfere with individualized clinical 
judgment about the appropriate course of care for a patient. OCR has a 
general practice of deferring to a clinician's judgment about whether a 
particular service is medically appropriate for an individual, or 
whether the clinician has the appropriate expertise to provide care. 
There is no part of section 1557 that compels clinicians to provide a 
service that they do not believe is medically appropriate for a patient 
or that they are not qualified to provide.
    With respect to commenters' concerns about potential conflicts 
between the final rule and individuals' or organizations' sincerely 
held religious beliefs, we refer commenters to the discussion of this 
topic at Sec.  92.302.
    Comment: Some commenters stated that because OCR relied on Bostock, 
it is bound by the definition of ``sex'' in Bostock and that definition 
should be included in the final rule. These commenters opined that the 
term ``sex characteristics'' as used by OCR is sometimes contrary to a 
binary understanding of the term ``sex,'' and accordingly ``sex 
characteristics'' either must be avoided in the regulations or used in 
a manner not to contradict the term ``sex'' being binary.
    Response: OCR has determined it is not necessary to define ``sex'' 
in this rule, as we have addressed a non-exhaustive list of what 
constitutes discrimination on the basis of sex at Sec.  92.101(a)(2). 
The Supreme Court did not define the term ``sex'' in Bostock, but 
rather noted that nothing in their approach to the cases considered 
turned on the debate over whether ``sex'' was limited to ``biological 
distinctions between male and female,'' and the Court therefore 
proceeded on the assumption that ``sex'' carried that meaning. 590 U.S. 
at. 655.
    OCR declines to remove reference to ``sex characteristics'' 
(including intersex traits) from Sec.  92.101(a)(2). Discrimination on 
the basis of sex characteristics, including intersex variations, is a 
prohibited form of sex discrimination because discrimination based on 
anatomical or physiological sex characteristics is inherently sex-
based. See 87 FR 47858.
    Comment: Numerous commenters supported the explicit inclusion of

[[Page 37576]]

discrimination based on sex characteristics, including intersex traits, 
stating that discrimination based on intersex traits is inherently sex-
based. Several commenters supported this proposal, citing barriers to 
appropriate care and coverage resulting from discrimination suffered by 
intersex patients.\122\ These commenters cited a report in which more 
than half of intersex respondents reported that a provider refused to 
see them because of their sex characteristics or intersex variation and 
that almost two-thirds reported having concerns that if they disclosed 
their intersex status to a provider, they could be denied quality 
medical care.\123\ A few commenters recommended that Sec.  92.101(a)(2) 
include concrete examples of sex discrimination, specifically on the 
basis of intersex traits.
---------------------------------------------------------------------------

    \122\ Lambda Legal & interACT Advocates, Providing Ethical and 
Compassionate Health Care to Intersex Patients: Intersex-Affirming 
Hospital Policies (2018), https://legacy.lambdalegal.org/sites/default/files/publications/downloads/resource_20180731_hospital-policies-intersex.pdf.
    \123\ See Caroline Medina & Lindsay Mahowald, Ctr. for Am. 
Progress, Advancing Health Care Nondiscrimination Protections for 
LGBTQI+ Communities (2022), https://www.americanprogress.org/article/advancing-health-care-nondiscrimination-protections-for-lgbtqi-communities.
---------------------------------------------------------------------------

    Response: Discrimination based on sex characteristics is a 
prohibited form of sex discrimination because discrimination based on 
anatomical or physiological sex characteristics is inherently sex-
based. 87 FR 47858. It follows that discrimination on the basis of 
intersex traits is prohibited sex discrimination because the individual 
is being discriminated against based on their sex characteristics.
    Comment: Numerous commenters generally supported the inclusion of 
pregnancy or related conditions as protected bases of sex 
discrimination at Sec.  92.101(a)(2) and recommended that OCR include 
examples of pregnancy-related discrimination. Commenters recommended 
including protection for pregnancy-related conditions as a standalone 
provision to emphasize the importance of these protections. Commenters 
stated that protection against discrimination on the basis of pregnancy 
or related conditions would protect many patients. Commenters also 
pointed out that as drafted, the Proposed Rule does not consistently 
define sex discrimination to include pregnancy-related conditions 
because other sections just state ``pregnancy'' as opposed to 
``pregnancy or related conditions.'' The commenters urged OCR to be 
consistent throughout the rule.
    Response: The inclusion of ``pregnancy or related conditions'' is 
consistent with the longstanding interpretation of the ``ground'' of 
discrimination prohibited under title IX because pregnancy-based 
discrimination has long been understood as a form of sex-based 
discrimination under title IX. For many years preceding the enactment 
of the ACA, the Department (along with other agencies) determined that 
discrimination based on pregnancy or related conditions is 
discrimination based on sex.\124\ Discrimination on the basis of 
pregnancy or related conditions may include, but is not limited to, 
instances of individuals who experience discrimination throughout 
pregnancy, labor and delivery, or the postpartum period. OCR agrees 
that the explicit inclusion of pregnancy or related conditions in the 
rule text is important for protecting many patients from 
discrimination.
---------------------------------------------------------------------------

    \124\ See 45 CFR 86.21(c)(2), (3); 86.40(b)(1), (4), and (5); 
86.51(b)(6); 86.57(b)(d) (title IX regulation).
---------------------------------------------------------------------------

    As discussed in the Proposed Rule, OCR considered inclusion of a 
provision to specifically address discrimination on the basis of 
``pregnancy or related conditions.'' 87 FR 47878. We received comments 
stating that a separate section was not appropriate. Those comments 
recommended that this issue be addressed under either Sec.  92.101 
(Discrimination prohibited) or Sec.  92.206 (Equal program access on 
the basis of sex). Accordingly, we maintain the inclusion of 
``pregnancy or related conditions'' here under Sec.  92.101(a)(2). For 
a further discussion of ``pregnancy or related conditions,'' please 
refer to the preamble discussion at Sec.  92.208 (Prohibition on sex 
discrimination related to marital, parental, or family status).
    Comment: A commenter stated that protections from pregnancy-based 
discrimination should include an informed consent requirement for 
abortion and childbirth, because the commenter asserted that consent 
for a Cesarean delivery is often obtained through coercion.
    Response: As noted in the Proposed Rule, 87 FR 47868, informed 
consent to any medical treatment is both a legal and ethical standard, 
regardless of the type of care, and serves as a basis for shared 
decision making.\125\ OCR declines to make any changes in response to 
this comment.
---------------------------------------------------------------------------

    \125\ Am. Med. Ass'n, Informed Consent, https://www.ama-assn.org/delivering-care/ethics/informed-consent.
---------------------------------------------------------------------------

    Comment: Numerous commenters recommended that, in light of the 
Supreme Court's decision in Dobbs v. Jackson Women's Health 
Organization, 142 S. Ct. 2228 (2022), and increased restrictions on 
reproductive health, OCR should provide that ``pregnancy or related 
conditions'' includes termination of pregnancy in the final rule. A 
group of commenters opined that the definition of ``pregnancy or 
related conditions'' should expressly exclude an abortion.
    Several commenters stated that OCR should clarify that this 
provision protects patients from discrimination on the basis of actual 
or perceived prior abortions. Several commenters stated that, as a 
result of abortion bans that have gone into effect post-Dobbs, women 
have been denied critical care, such as cancer treatment, because of 
abortion-related concerns. A commenter wrote that abortion is often 
necessary to save patients' lives, especially from complications like 
ectopic pregnancy or premature rupture of membrane.
    Response: OCR appreciates commenters' concerns and recognizes that 
the Supreme Court decision in Dobbs changed the legal landscape as to 
abortion access. While we agree that protections afforded for pregnancy 
or related conditions include termination of pregnancy, OCR declines to 
revise the language at Sec.  92.101(a)(2) to include or exclude 
specific examples and will interpret section 1557's protections on the 
basis of sex consistent with applicable case law addressing 
discrimination on the basis of sex, including pregnancy or related 
conditions.
    OCR has concluded as a matter of statutory interpretation that 
section 1557 does not require the Department to incorporate the 
language of title IX's abortion neutrality provision, see preamble 
discussion at Sec.  92.208 (Prohibition on sex discrimination related 
to marital, parental, or family status). At the same time, OCR 
emphasizes that a covered provider's decision not to provide abortions 
does not itself constitute discrimination in violation of section 1557. 
Also, a covered provider's willingness or refusal to provide, pay for, 
cover, or refer for abortion or to provide or participate in training 
to provide abortion also is not discrimination under section 1557. 
Section 1557 prohibits discrimination on the basis of race, color, 
national origin, sex, age, or disability in covered health programs or 
activities. A covered provider that generally offered abortion care 
could violate that prohibition if, for example, it refused to provide 
an abortion to a particular patient because of that patient's race or 
disability. But a covered provider does not engage in

[[Page 37577]]

discrimination prohibited by section 1557 if it declines to provide 
abortions based on religious or conscience objections to performing the 
procedure, based on a professional or business judgment about the scope 
of the services it wishes to offer, or for any other nondiscriminatory 
reason.
    It bears emphasis that nothing in the ACA, including section 1557, 
has ``any effect on Federal laws regarding--(i) conscience protection; 
(ii) willingness or refusal to provide abortion; and (iii) 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.'' 42 U.S.C. 18023(c)(2)(A). In addition, 
nothing in the ACA, including section 1557, preempts or has any effect 
on State laws regarding ``the prohibition of (or requirement of) 
coverage, funding, or procedural requirements on abortions'' as 
provided in section 1303 of the ACA, 42 U.S.C. 18023(c)(1).
    Against this legal landscape, OCR will evaluate specific claims of 
discrimination on prohibited bases on a case-by-case basis, and we 
decline to revise the language at Sec.  92.101(a)(2). We note also 
that, as commenters suggested, this provision protects patients from 
discrimination on the basis of actual or perceived prior abortions. For 
example, a recipient's denial of unrelated medical care that the 
provider generally provides to other patients to an individual based 
solely on the fact they had a prior abortion would constitute 
prohibited discrimination within the meaning of section 1557. Moreover, 
both the 2016 and 2020 Rules recognized that discrimination on the 
basis of pregnancy termination can be a form of sex discrimination.
    Comment: Conversely, a commenter argued that OCR should not 
interpret ``pregnancy or related conditions'' to include ``termination 
of pregnancy'' because of a concern that it will force health care 
providers to participate in abortions and requested that OCR provide 
further clarification as to what types of conduct would be prohibited 
discrimination under the rule. Another commenter stated the Proposed 
Rule wrongly treats abortion as a right protected from sex 
discrimination and that title IX contains an abortion neutrality 
provision that the rule would contravene.
    Response: As discussed above, a covered provider's decision not to 
provide abortions does not itself constitute discrimination in 
violation of section 1557. A covered provider does not engage in 
discrimination prohibited by section 1557 if it declines to provide 
abortions based on religious or conscience objections to performing the 
procedure, based on a professional or business judgment about the scope 
of the services it wishes to offer, or for any other nondiscriminatory 
reason. A covered entity that chooses to provide abortion care but 
refuses to provide an abortion for a particular individual on the basis 
of a protected ground--such as race--would violate section 1557. For 
discussion regarding the title IX abortion neutrality provision, please 
see Sec.  92.208.
    Comment: Several commenters requested that OCR clarify that Sec.  
92.101(a)(2) prohibits discrimination against individuals when they are 
seeking or accessing fertility care, maternity care, and other 
reproductive health care specifically. A commenter recommended that OCR 
clarify that pregnancy-related care applies throughout pregnancy, 
childbirth, and the postpartum period.
    Response: Section 1557 protects individuals against prohibited 
discrimination in all covered health programs and activities regardless 
of the type of care they are seeking or accessing, including fertility 
care, maternity care, and other reproductive health care. Similarly, 
section 1557 protects individuals seeking or accessing health programs 
and activities provided for or during preconception, pregnancy, 
childbirth, and postpartum recovery. Ensuring that section 1557's 
protections apply throughout the continuum of care is especially 
critical for Black women and other people of color, who face worse 
health outcomes and experience higher rates of discrimination 
throughout pregnancy and the postpartum period.\126\
---------------------------------------------------------------------------

    \126\ Saraswathi Vedam et al., The Giving Voice to Mothers 
Study: Inequity and Mistreatment During Pregnancy and Childbirth in 
the United States, 16 Reprod. Health 1 (2019), https://doi.org/10.1186/s12978-019-0729-2.
---------------------------------------------------------------------------

    Comment: Many commenters raised concerns about barriers to 
reproductive health care faced by LGBTQI+ patients. A commenter 
strongly urged more explicit inclusion of ``fertility'' as a form of 
impermissible sex-based discrimination--so that Sec.  92.101(a)(2)(ii) 
prohibits discrimination on the basis of ``pregnancy, fertility, or 
related conditions''--as infertility is a serious issue that impacts 
many LGBTQI+ populations. Commenters stated that LGBTQI+ people 
continue to face barriers to fertility treatment, such as in vitro 
fertilization (IVF), and that coverage of fertility treatments often 
limit or exclude LGBTQI+ patients.
    Response: OCR acknowledges the unique challenges faced by LGBTQI+ 
individuals seeking fertility treatment. Individuals are protected from 
discrimination regardless of the type of health care they seek, and we 
have concluded it is unnecessary to provide provisions for each 
specific form of health care available. Whether discrimination on the 
basis of sexual orientation or gender identity occurred in the 
provision or coverage of assistive reproductive technology--such as 
IVF--is necessarily fact specific. However, if a covered entity elects 
to provide or cover fertility services but categorically denies them to 
same-sex couples, it may violate section 1557's prohibition on sex 
discrimination.
    Comment: Numerous commenters generally supported inclusion of 
sexual orientation as a protected basis for sex discrimination, and 
said that its inclusion would improve health care for LGBTQI+ 
individuals. Many commenters stated that LGBTQI+ individuals face 
discriminatory challenges to accessing health care and that the rule 
would alleviate these issues. Many commenters wrote that LGBTQI+ 
individuals often anticipate that they will experience discrimination 
in health care and thus often may not seek out care.
    Response: It is well documented that LGBTQI+ individuals face 
discrimination when accessing or attempting to access health care and 
health insurance. Section 1557 is a critical tool in combating such 
discrimination and addressing the resulting health disparities and 
other negative impacts.
    Comment: Numerous commenters generally supported the inclusion of 
discrimination on the basis of gender identity as a prohibited form of 
sex discrimination. Other commenters recommended including 
``transgender or nonbinary status,'' ``nonbinary and gender-
nonconforming,'' and ``including status as transgender, nonbinary, 
gender nonconforming, two-spirit, or other gender.''
    Response: OCR recognizes that individuals use various terminology 
to describe their gender identity. For this reason, we decline to 
provide a definition of ``gender identity'' or ``transgender status'' 
in the regulation. We reiterate here that OCR will investigate 
discrimination against an individual based on having a gender identity 
that is different from their sex assigned at birth as discrimination on 
the basis of gender identity, regardless of whether the individual 
identifies with or uses the term ``transgender'' or another identity.
    OCR is aware that the Bostock majority uses the term ``transgender

[[Page 37578]]

status'' exclusively. But Bostock reasoned that when a person 
discriminates ``against transgender persons, the employer unavoidably 
discriminates against persons with one sex identified at birth and 
another today'' such that ``[a]ny way you slice it, the employer 
intentionally refuses to hire applicants in part because of the 
affected individuals' sex, even if it never learns any applicant's 
sex.'' See Bostock, 590 U.S. at 669. This therefore includes 
discrimination against a person because they are transgender, or 
because they identify in some other way that is inconsistent with their 
sex assigned at birth, e.g., because they are gender nonconforming. 
Such discrimination is also based on requiring persons to conform to 
stereotypical norms about sex and gender, which can also serve as the 
basis for impermissible sex discrimination. See, e.g., Whitaker, 858 
F.3d at 1048-49 (citing Price Waterhouse, 490 U.S. at 251). Therefore, 
the prohibition against discrimination based on gender identity, rather 
than just transgender status, more fully protects individuals from 
prohibited sex discrimination. Indeed, the Bostock dissent stated that, 
as defined by the American Psychological Association, ``there is no 
apparent difference between discrimination because of transgender 
status and discrimination because of gender identity.'' 590 U.S. at 
686, n.6 (Alito, J. joined by Thomas, J., dissenting).
    Comment: Several commenters supported OCR's general goal at Sec.  
92.101(b) of explicitly incorporating the prohibitions on 
discrimination found in title VI, section 504, title IX, and the Age 
Act and thought this approach is prudent, given that some health care 
entities may not be readily familiar with the specific regulatory 
standards and obligations that apply to them under civil rights laws. A 
few commenters noted that incorporating section 504 regulations 
pertaining to accessibility could create conflicting obligations and 
specifically objected to incorporating 45 CFR 84.23(c), which applies 
an outdated standard (the Uniform Federal Accessibility Standards) to 
new facility constructions. These commenters recommended including 
additional language in Sec.  92.101(b)(1)(i) that expressly states 
``(except for Sec.  84.23(c)).''
    Response: We appreciate commenters' concerns regarding inclusion of 
Sec.  84.23(c). Because the rule has a separate subsection with respect 
to ``Accessibility for buildings and facilities,'' commenters should 
refer to this preamble's discussion of Sec.  92.203.
    Comment: Some commenters requested that OCR restore the 2016 Rule 
clarification that any age distinctions exempt from the Age Act are 
also exempt from section 1557 enforcement.
    Response: OCR appreciates commenters' request for clarity regarding 
the Age Act's permitted age distinctions. This rule adopts by reference 
the Age Act implementing regulation provisions at 45 CFR part 91 
(subpart B), which explicitly recognize that some age distinctions may 
be necessary to the normal operation of a program or activity or to the 
achievement of any statutory objective. See 45 CFR 91.13 (adopting 
statutorily permissive age distinctions found at 42 U.S.C. 6103(b)(1)).
    Comment: A commenter stated that OCR should exercise its authority 
to enforce disparate impact claims in order to address systemic 
discrimination in health care.\127\ Another commenter supported the 
approach taken by OCR in the Proposed Rule to not include the site 
location provision from the 2016 Rule, stating they believed section 
1557's context, structure, and text make evident that Congress did not 
intend to import multiple, piecemeal legal standards and burdens of 
proof derived from different statutory contexts into the doctrinal 
patchwork; and that section 1557 provides the full range of enforcement 
mechanisms and remedies available to any person pursuing a 
discrimination claim under section 1557, regardless of their protected 
characteristic.
---------------------------------------------------------------------------

    \127\ Ruqaiijah Yearby et al., Structural Racism in Historical 
and Modern US Health Care Policy, 41 Health Affairs 187 (2022), 
https://www.healthaffairs.org/doi/10.1377/hlthaff.2021.01466; Joe 
Feagin & Zinobia Bennefield. Systemic Racism and U.S. Health Care, 
103 Soc. Sci. & Med. 7 (2014), https://doi.org/10.1016/j.socscimed.2013.09.006; Cara A. Fauci, Racism and Health Care in 
America: Legal Responses to Racial Disparities in the Allocation of 
Kidneys, 21 Boston Coll. Third World J. 35 (2001); Amitabh Chandra 
et al., Challenges to Reducing Discrimination and Health Inequity 
through Existing Civil Rights Laws, 36 Health Affairs 1041 (2017), 
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5654529/.
---------------------------------------------------------------------------

    Response: After reviewing comments, OCR declines to include 
provisions similar to former 45 CFR 92.101(b)(3)(ii) and (iii), which 
are not included in the 2020 Rule. OCR will preserve the longstanding 
treatment of discrimination in the referenced statutes' implementing 
regulations consistent with relevant case law.
Summary of Regulatory Changes
    For the reasons set forth above and considering the comments 
received, we are finalizing the provision as proposed in Sec.  92.101, 
with modifications. We added ``or any combination thereof'' after 
disability and deleted the ``or'' before disability in Sec.  
92.101(a)(1).

Subpart C--Specific Applications to Health Programs and Activities

    Because of section 1557's specific application to health programs 
and activities, subpart C provides additional detail regarding 
nondiscrimination requirements in these settings. The provisions in 
this subpart are responsive to the nature and importance of health 
care, health insurance coverage, and other health-related coverage, and 
related health programs and activities as those health-related issues 
impact individuals and communities protected by section 1557's 
prohibition of discrimination. These provisions are intended to provide 
clear instruction to covered entities and are informed by OCR's 
experience in both enforcement and in providing technical assistance as 
well as outreach to interested parties.
Meaningful Access for Individuals With Limited English Proficiency 
(Sec.  92.201)
    In proposed Sec.  92.201, we proposed provisions to effectuate 
section 1557's prohibition on national origin discrimination as it is 
applied to individuals with LEP in covered health programs and 
activities. In Sec.  92.201(a), we proposed that covered entities 
``must take reasonable steps to provide meaningful access to each 
limited English proficient individual eligible to be served or likely 
to be directly affected by its health programs and activities.''
    In Sec.  92.201(b), we proposed that language assistance services 
required under Sec.  92.201(a) must be provided free of charge, be 
accurate and timely, and protect the privacy and independent decision-
making ability of an individual with LEP.
    In Sec.  92.201(c), we proposed specific requirements for 
interpreter and translation services. Section 92.201(c)(1) proposed 
that when interpreter services are required under this part, a covered 
entity must offer a qualified interpreter. Section 92.201(c)(2) 
proposed that when translation services are required under this part, a 
covered entity must use a qualified translator.
    In Sec.  92.201(c)(3), we proposed regulatory language requiring a 
covered entity that uses machine translation to have translated 
materials reviewed by a qualified human translator when the underlying 
text is critical to the rights, benefits, or meaningful access of an 
individual with LEP; when accuracy is essential; or when the source 
documents or materials contain complex, non-literal, or technical 
language. We sought

[[Page 37579]]

comment on the use of machine translation in health programs and 
activities generally, other possible approaches to address this issue, 
and whether there should be an exception to this provision to allow for 
the limited use of machine translation in exigent circumstances.
    In Sec.  92.201(d), we addressed how the Director will evaluate 
compliance with this section. In Sec.  92.201(d)(1), we proposed that 
the Director shall evaluate, and give substantial weight to, the nature 
and importance of the health program or activity and the particular 
communication at issue, to the individual with LEP. Proposed Sec.  
92.201(d)(2) provides that the Director shall take into account other 
relevant factors, including the effectiveness of the covered entity's 
written language access procedures for its health programs and 
activities, that the covered entity has implemented pursuant to 
proposed Sec.  92.8(d).
    In Sec.  92.201(e), we proposed restrictions on the use of certain 
persons to provide language assistance services for individuals with 
LEP. In Sec.  92.201(e)(1), we proposed prohibitions on covered 
entities from requiring individuals with LEP to provide, or pay for, 
their own interpreters. Proposed Sec.  92.201(e)(2) provided for very 
limited situations in which an adult, not qualified as an interpreter, 
accompanying an individual with LEP can serve as an interpreter. 
Section 92.201(e)(3) proposed to prohibit a covered entity from relying 
on a minor child to interpret or facilitate communication, except as a 
temporary measure while finding a qualified interpreter in an emergency 
involving an imminent threat to the safety or welfare of an individual 
or the public where there is no qualified interpreter for the 
individual with LEP immediately available. In Sec.  92.201(e)(4), we 
proposed prohibiting reliance on staff other than qualified 
interpreters, qualified translators, or qualified bilingual or 
multilingual staff to communicate directly with individuals with LEP.
    In Sec.  92.201(f), we proposed standards for video remote 
interpreting (VRI).
    In Sec.  92.201(g), we proposed standards for audio remote 
interpreting services.
    In Sec.  92.201(h), we proposed that nothing in this section shall 
be construed to require an individual with LEP to accept language 
assistance services.
    The comments and our responses regarding Sec.  92.201 are set forth 
below.
    Comment: Many commenters were very supportive of Sec.  92.201(a)'s 
requirement that covered entities must take reasonable steps to provide 
meaningful access to ``each'' individual with LEP eligible to be served 
or likely to be directly affected by its health programs and 
activities. Commenters also supported OCR's revision concerning 
individuals with LEP ``likely to be directly affected'' by a health 
program or service, as opposed to the previous ``likely to be 
encountered,'' as it provides greater clarity about the applicability 
of this rule and reduces some burden on health care practices. 
Commenters maintained that this standard provides a better description 
for providers to understand. Other commenters supported inclusion of 
``eligible to be served or likely to be directly affected'' because 
they believe it expands the definition of who can receive language 
access and better reflects how language service needs are experienced 
by people seeking health care. Many commenters recommended that OCR 
clarify that companions are expressly included, noting that this is 
especially important for caretakers of minor children or those 
accompanying older adults.
    Response: OCR appreciates commenters' thoughts on the language at 
Sec.  92.201(a) and confirms that covered entities' language access 
obligations also apply to companions (defined in Sec.  92.4), as 
companions are ``directly affected by [a covered entity's] health 
programs and activities'' by virtue of their relationship with the 
person whom they are accompanying. For example, a covered entity will 
need to take reasonable steps to provide meaningful access to a parent 
with LEP whose minor child is being treated or an individual with LEP 
who may be assisting their spouse with post-operative care. To 
reinforce this requirement, OCR is adding a parenthetical to the text 
of Sec.  92.201(a) to clarify that individuals with LEP who are covered 
under this part include companions with LEP. This language is 
consistent with the requirement to provide effective communication for 
companions with disabilities under Sec.  92.202.
    Comment: Various commenters appreciated OCR providing clarity on 
the terms ``reasonable steps'' and ``meaningful access,'' noting that 
the 2020 Rule's deletion of meaningful access requirements was 
detrimental to the health of communities with LEP. A few commenters 
recommended that clearer directives should be included as to what types 
of services constitute ``reasonable steps,'' suggesting this could be 
clarified by providing examples of ``reasonable steps,'' or by adding 
definitions of ``reasonable steps'' and ``meaningful access'' to Sec.  
92.4 (Definitions). Another commenter cautioned that the lack of 
clarity could result in covered entities coming to the determination 
that no services are required of them. Others stated that additional 
guidance is needed specifically for providers and payers.
    Response: OCR appreciates the request for additional definitions; 
however, we decline to provide a definition for ``reasonable steps'' or 
``meaningful access,'' as these terms are not unique to section 1557 
and reflect longstanding requirements under title VI. OCR will consider 
developing additional guidance on this topic but also refers commenters 
to the Department's longstanding HHS LEP Guidance, 67 FR 47311, as well 
as the Department's 2023 Language Access Annual Progress Report. The 
2023 Progress Report describes the Department's reconstituted Language 
Access Steering Committee based on the HHS Equity Action Plan issued 
under E.O. 13985, clarifies benchmarks for meaningful language access 
in key areas such as developing best practices for oral interpretation 
and internet-based access to written translation, and sets forth 
current plans to update the Department's Language Access Plans and 
issue related guidance.\128\
---------------------------------------------------------------------------

    \128\ U.S. Health & Hum. Servs., Off. for Civil Rts., 2023 
Language Access Annual Progress Report (2023), https://www.hhs.gov/sites/default/files/language-access-report-2023.pdf.
---------------------------------------------------------------------------

    Comment: A number of commenters stated that failure to provide 
meaningful access may violate both section 1557's national origin 
prohibition and the prohibition on race discrimination. Several 
commenters stated that there are instances in which an individual 
experiences discrimination based on their limited English proficiency, 
in addition to another protected characteristic. For example, a person 
who is Black and has limited English proficiency is more likely to 
experience discrimination in health care settings than an individual 
who is Black but does not have limited English proficiency or an 
individual with limited English proficiency but who is not Black.\129\ 
Commenters stated that this type of discrimination may deter patients 
from seeking critical health care services, leading to adverse health 
outcomes and decreased trust in the health care system.\130\ Commenters 
also

[[Page 37580]]

provided data showing that almost one in four health center patients 
communicate in a language other than English; \131\ 63 percent of 
individuals with LEP identify as Hispanic/Latino; \132\ language 
barriers have been proven to contribute to health inequities for Asian 
American, Native Hawaiian, and Pacific Islander individuals in 
particular; \133\ and people with LEP are less likely to receive 
primary care and preventive care, such as breast and cervical cancer 
screenings.\134\
---------------------------------------------------------------------------

    \129\ Neelam H. Ahmed et al., Moderation of the Association 
Between Primary Language and Health by Race and Gender: An 
Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 
(2022), https://www.mdpi.com/1660-4601/19/13/7750.
    \130\ Neelam H. Ahmed et al., Moderation of the Association 
between Primary Language and Health by Race and Gender: An 
Intersectional Approach, 19 Int. J. Environ. Rsch. Pub. Health 7750 
(2022), https://www.mdpi.com/1660-4601/19/13/7750: Francisco Ramos-
Gomez et al., Addressing Social Determinants of Oral Health, 
Structural Racism and Discrimination and Intersectionality among 
Immigrant and Non-English Speaking Hispanics in the United States, 
82 J. Pub. Health Dentistry 133 (2022), https://doi.org/10.1111/jphd.12524.
    \131\ Kathryn Pitkin Derose et al., Limited English Proficiency 
and Latinos' Use of Physician Servs., 57 Med. Care Rsch. Rev. 76 
(2000), https://doi.org/10.1177/107755870005700105.
    \132\ Jie Zong & Jeanne Batalova, Migration Pol'y Inst., The 
Limited English Proficient Population in the United States in 2013 
(2015), https://www.migrationpolicy.org/article/limited-english-proficient-population-united-states-2013.
    \133\ Gilbert C. Gee et al., Associations Between Racial 
Discrimination, Limited English Proficiency, and Health-Related 
Quality of Life Among 6 Asian Ethnic Groups in California, 100 Am. 
J. of Pub. Health 891 (2010), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2853608/.
    \134\ Elizabeth A. Jacobs et al., Limited English Proficiency 
and Breast and Cervical Cancer Screening in a Multiethnic 
Population, 95 Am. J. Pub. Health, 1410 (2005), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1449374/; Israel De Alba et 
al., English Proficiency and Physicians' Recommendation of Pap 
Smears Among Hispanics, 30 Cancer Detection & Prevention 292 (2006), 
https://pubmed.ncbi.nlm.nih.gov/16844320/; Lisa Diamond et al., A 
Systematic Review of the Impact of Patient-Physician Non-English 
Language Concordance on Quality of Care and Outcomes, 34(8) J. Gen. 
Internal Med. 1591 (2019), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6667611/; Kelly H. Bruce et al., Barriers and 
Facilitators to Prevent Cancer Screening in Limited English 
Proficient (LEP) Patients: Physicians' Perspectives, 11 Commc'ns. 
Med. 235 (2014), https://journal.equinoxpub.com/CAM/article/view/8592.
---------------------------------------------------------------------------

    Some commenters also specifically addressed the importance of 
language assistance services for older individuals with LEP. These 
commenters submitted research demonstrating that it is especially 
difficult for older adults with LEP to communicate with providers 
because of limited English proficiency, low health literacy, and lack 
of translators and interpreters.\135\ Many commenters argued that to 
ensure access to quality care, covered entities must have translators 
and interpreters available at all points of contact at no cost to an 
individual. This is because older adults may be less inclined to ask 
for language assistance or may rely on family members who are not 
qualified to interpret health information. Additionally, the commenters 
noted that language assistance services are critical for people at the 
end of life who, absent these services, cannot give true informed 
consent or thoroughly understand their end-of-life care options.
---------------------------------------------------------------------------

    \135\ U.S. Dep't of Health & Hum. Servs., Ctr. for Disease 
Control, Adults with Disabilities: Ethnicity and Race, https://www.cdc.gov/ncbddd/disabilityandhealth/materials/infographic-disabilities-ethnicity-race.html (citing Elizabeth A. Courtney-Long 
et al., Socioeconomic Factors at the Intersection of Race and 
Ethnicity Influencing Health Risks for People with Disabilities, 4 
J. Racial and Ethnic Health Disparities 213 (2017), https://pubmed.ncbi.nlm.nih.gov/27059052/); Francisco J. Medrano et al., 
Limited English Proficiency in Older Adults Referred to the 
Cardiovascular Team, 136 Am. J. of Med. 466 (2023); Terceira A. 
Berdahl et al., Patient-Provider Communication Disparities by 
Limited English Proficiency (LEP): Trends from the US Medical 
Expenditure Panel Survey, 2006-2015, 34 J. Gen. Internal Med. 1434 
(2019), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6667581/.
---------------------------------------------------------------------------

    Response: OCR appreciates these comments and the data submitted. As 
discussed elsewhere in this preamble, section 1557's language access 
requirements derive from the statute's prohibition on discrimination 
against national origin. OCR also appreciates, and agrees with, 
comments highlighting the ways in which individuals may experience 
discrimination on multiple grounds as well as comments about the 
importance of language assistance services for older individuals with 
LEP. The provisions for Sec.  92.201(a) enhance health access and 
reduce discrimination by requiring covered entities to take reasonable 
steps to provide meaningful access to each individual with LEP.
    Comment: Many commenters stated that language assistance has often 
been costly to the individuals with LEP, and translations have often 
been inaccurate, incomplete, or both. Commenters additionally noted 
that language assistance has often been provided later in time than 
other services and that interpretation has not been done in a way that 
protects patient privacy. Other commenters submitted examples of 
individuals with LEP being provided with incomplete information, such 
as being told of only one treatment option, rather than be told of 
other available treatment options.
    Response: We appreciate concerns raised regarding cost, timeliness, 
and privacy concerns, which we address in Sec.  92.201(b). Consistent 
with language access requirements in the 2016 and 2020 Rules, required 
language assistance services must be provided free of charge, be 
accurate and timely, and protect the privacy of the individual with 
LEP. Inaccurate or incomplete translations or interpretation may 
violate the accuracy standard found in this provision and the 
overarching requirement to take reasonable steps to provide meaningful 
access. Accuracy issues are further addressed by requiring covered 
entities to use the services of qualified interpreters and translators, 
at Sec.  92.201(c).
    Comment: Commenters noted a lack of definition for timeliness in 
Sec.  92.201(b), and one recommended OCR establish time, distance, and 
wait time standards. Another commenter suggested that the timeliness 
standard take into account the geographic location of the covered 
entity and the hour of the day when the need for language assistance 
services arises.
    Response: As OCR discusses in the HHS LEP Guidance, timeliness may 
depend on multiple variables and so no one definition would be 
reasonable or applicable to ``all types of interactions at all times by 
all types of recipients.'' 68 FR 47316. However, language assistance 
should be provided at a time and place that avoids the effective denial 
of the service, benefit, or right at issue or the imposition of an 
undue burden on or delay in important rights, benefits, or services to 
the person with LEP. 68 FR 47316. When evaluating a complaint, OCR will 
consider the context, including the urgency and importance of many 
health care services. We encourage covered entities to review the HHS 
LEP Guidance for additional guidance.
    Comment: Several commenters stated that language assistance 
services should be required to include cultural competency and that 
providers should reflect the community around them in order to build 
trust. One commenter noted that during listening sessions they 
conducted, participating health centers emphasized the important role 
that bilingual and bicultural staff who represent the community served 
to provide accurate and culturally comprehensible interpretation. A few 
commenters recommended requiring covered entities to ensure sufficient 
staff with appropriate training and to administer language proficiency 
assessments to confirm competency of bilingual and multilingual staff.
    Some commenters urged that translators and interpreters be from or 
a part of the impacted community in which they serve, with some 
suggesting that community-based interpreters and translators may be 
more qualified for a number of reasons, including familiarity with 
local dialect and cultural competency. Others, however, stated that 
family members and community service providers or other external groups 
should not have to bear the burden of interpreting.
    Response: OCR generally agrees that cultural competency is 
essential for

[[Page 37581]]

equitable language access and communications.\136\ This is especially 
important considering variations in dialects, expressions, or 
``regionalisms.'' For example, a Spanish word that may be understood to 
mean something for someone from Puerto Rico may mean something else for 
someone from Mexico. Thus, cultural competency is a key factor in 
providing accurate interpretation and translation, and accuracy is a 
necessary component of meaningful access.
---------------------------------------------------------------------------

    \136\ See U.S. Dep't of Health & Hum. Servs., Off. of Minority 
Health, Think Cultural Health, National Standards for Culturally and 
Linguistically Appropriate Services (CLAS) in Health and Health 
Care, https://thinkculturalhealth.hhs.gov/assets/pdfs/EnhancedNationalCLASStandards.pdf (recommending that health 
organizations: ``[p]rovide effective, equitable, understandable, and 
respectful quality care and services that are responsive to diverse 
cultural health beliefs and practices, preferred languages, health 
literacy, and other communication needs,'' through providing 
language assistance and ``[e]stablish[ing] culturally and 
linguistically appropriate goals, policies, and management 
accountability, and infuse them throughout the organization's 
planning and operations'').
---------------------------------------------------------------------------

    OCR recognizes that community members may be more likely to be 
culturally competent but declines to include in the regulatory text a 
requirement that translators and interpreters be from the community 
they serve. Covered entities are free to determine their own hiring and 
contracting processes for utilizing the services of qualified 
interpreters and translators, and hiring bilingual/multilingual staff, 
as long as these individuals meet the requirements for their respective 
positions as provided in Sec.  92.4 (Definitions).
    Comment: Many commenters supported the novel proposal to address 
machine translation in this regulation, with some requesting that 
machine translation always be checked by a qualified human translator 
and that patients be advised when a translation has been completed by 
machine translation due to high error rates. One commenter specified 
that covered entities should not use Google Translate as the only 
resource for translations as it generates errors, pointing to a State 
Department of Health website translating ``the vaccine is not 
required'' for COVID-19 to ``the vaccine is not necessary'' in Spanish 
(since corrected). Other commenters stated that the rule does not 
adequately account for future innovations and that the final rule 
should include an exception for exigent circumstances. Insurance 
entities and other providers commented that machine translation is a 
viable option to reduce costs in some instances.
    Response: OCR recognizes that machine translation is an evolving 
technology. However, given that it still carries significant potential 
for error, we believe this provision strikes an appropriate balance 
between the convenience some may find in this technology and the 
critical nature of communications in the health care context. We 
appreciate commenters' concerns regarding exigent circumstances, where 
use of machine translation technology may provide immediate language 
assistance capabilities in very urgent circumstances. As provided under 
Sec.  92.201(a), ``[a] covered entity must take reasonable steps to 
provide meaningful access to each individual with limited English 
proficiency (including companions with limited English proficiency) 
eligible to be served or likely to be directly affected by its health 
programs and activities.'' For example, if an emergency medical 
technician must provide urgent medical care to an individual with LEP, 
and no other language assistance services are available, it may be 
reasonable to use machine translation technology to communicate with 
that person while a qualified interpreter is identified. We note that 
the definition for machine translation found at Sec.  92.4 under this 
final rule ``means automated translation . . . that is text based and 
provides instant translations between various languages,'' which 
includes automated translation covers speech as well as written 
communications. However, given the importance of communication and 
understanding in the health care and services setting, OCR requires 
that in such circumstances, the machine translation must be 
subsequently checked by a qualified human translator as soon as 
practicable. OCR also recommends that, if machine translation is used 
in circumstances that do not require human review (i.e., those 
circumstances that do not meet the criteria set forth in Sec.  
92.201(c)(3)), the patients should be warned that it may contain 
errors. OCR directs commenters to Sec.  92.4 (Definitions) for further 
discussion on machine translation and future technology.
    Comment: OCR received limited comments on our proposed revisions to 
the factors the Director will take into account when evaluating 
compliance with language access obligations (proposed Sec.  92.201(d)). 
Several commenters supported discontinuing the 2020 Rule's use of the 
``four-factor analysis,'' 45 CFR 92.101(b)(1), found in the HHS LEP 
Guidance, 68 FR 47314-16, to determine compliance with a covered 
entity's language access requirements under section 1557. These 
commenters stated that the four-factor analysis is too vague to be 
useful for oversight of compliance and does not provide direction on 
how each of the factors would be weighed against each other. 
Conversely, a few commenters recommended that OCR retain the four-
factor analysis since it provides covered entities more flexibility. 
These commenters noted that recipients must have flexibility in 
achieving compliance with requirements for language access because of 
their limited resources and patient populations.
    A few commenters noted that the phrase ``other relevant factors'' 
in Sec.  92.201(d) is vague and should either be removed or clarified. 
Specifically, they said that compliance has been an ongoing problem and 
more information is needed to help covered entities understand the 
factors that will be used for evaluation of compliance. Additionally, 
one commenter recommended that the final rule include the geographic 
location of the covered entity and the hour of the day when the need 
for language assistance services arises as one of the factors for OCR 
to consider in evaluating compliance. For example, the ability of a 
small, rural provider to find an interpreter for an individual with LEP 
at midnight on a Saturday is going to be substantially more challenging 
than it would be for a provider in an urban setting.
    Response: As discussed in the 2022 NPRM, 87 FR 47862, after 
additional consideration OCR determined that the four-factor test was 
not a sufficiently precise or flexible compliance tool. Section 
92.201(d)(1) provides flexibility that allows the Director to take into 
account a range of relevant factors, including the ``nature and 
importance of the health program or activity and the particular 
communication at issue, to the individual with limited English 
proficiency.'' Additionally, Sec.  92.201(d)(2) allows for the 
consideration of ``other relevant factors,'' including those that 
relate to whether ``reasonable steps'' were taken in a given situation. 
Thus, the Director may take into account the geographic location and 
timing considerations posed by the commenter's example in evaluating 
whether ``reasonable steps'' were taken.
    Comment: Many commenters supported the inclusion of an explicit 
prohibition on the use of certain persons to interpret or facilitate 
communication, including the expectation that in an emergency 
situation, reliance on an accompanying adult or minor should be ``a 
temporary measure'' at Sec.  92.201(e).

[[Page 37582]]

Commenters stated that children oftentimes are asked to interpret 
medical information for which they do not have the vocabulary or 
content knowledge. Some also stated that older adults with LEP may feel 
pressure to rely on family members as interpreters, even if those 
family members are not qualified to interpret health information, which 
can inhibit the older adult's understanding of their health status and 
instructions from their provider.
    Response: We appreciate the commenters' support and underscore that 
untrained ``interpreters'' are more likely to make errors, violate 
confidentiality, and increase the risk of poor outcomes. Research has 
shown that the ability of a provider to accurately diagnose a patient's 
condition can be jeopardized by untrained interpreters, such as family 
and friends, and especially minor children who are prone to omissions, 
additions, substitutions, volunteered opinions, semantic errors, and 
other problematic practices.\137\ Additionally, the use of children as 
interpreters raises not only the same concerns as those of an 
accompanying adult who is not qualified as an interpreter, but also 
poses other problems including exposing children to complex health care 
interactions for which they are not developmentally prepared, upsetting 
a family power dynamic, causing embarrassment, and conveying incorrect 
or incomplete information. 87 FR 47863.
---------------------------------------------------------------------------

    \137\ Joseph R. Betancourt et al., The Disparities Solutions 
Ctr., Mongan Inst. for Health Pol'y, Mass. Gen. Hosp., Improving 
Patient Safety Systems for Patients with Limited English 
Proficiency: A Guide for Hospitals, pp. 3-5, 10-11, 14-16 (2012), 
https://www.ahrq.gov/sites/default/files/publications/files/lepguide.pdf.
---------------------------------------------------------------------------

    Comment: Some commenters requested that OCR provide emergency 
exceptions for using bilingual/multilingual staff as interpreters. 
These commenters noted that covered entities should be able to use 
their staff's skills in different languages when needed in emergency 
situations.
    Response: We appreciate commenters' concerns regarding obtaining 
the services of a qualified interpreter in emergency situations. Under 
Sec.  92.201(e)(2) introductory text, a covered entity may ``[r]ely on 
an adult, not qualified as an interpreter, accompanying a limited 
English proficient individual to interpret or facilitate 
communication'' as a temporary measure in an emergency pending the 
retention of a qualified interpreter. OCR has revised Sec.  
92.201(e)(2) introductory text to remove references limiting reliance 
on a non-qualified interpreter to only an adult ``accompanying an 
individual with LEP.'' This provision now allows for a covered entity 
to rely on a bilingual/multilingual staff member--or other adult not 
accompanying an individual with LEP--to serve as an interpreter as a 
temporary measure in such emergency situations. Furthermore, the 
interpreter services of bilingual/multilingual staff who are also 
qualified interpreters may be utilized in any situation, including 
emergency situations. However, covered entities should consider how to 
obtain the services of a qualified interpreter as quickly as possible 
in emergency and exigent circumstances, and only rely upon other 
persons in highly exceptional circumstances.
    Comment: A couple of commenters recommended that OCR revise Sec.  
92.201(e)(2)(ii) to allow a covered entity to use a qualified 
interpreter even in situations where the patient has requested that a 
family member or friend interpret or facilitate communication. These 
commenters explained that if a provider believes that the family member 
or friend may not be accurately communicating with the patient or 
appears to be struggling when interpreting or if a health provider 
suspects in good faith that an individual may be a victim of 
trafficking or abuse, then the health provider should be able to 
utilize a qualified interpreter.
    Another commenter recommended that OCR clarify that an accompanying 
adult may only facilitate communication at the request of an individual 
with LEP when the request is made in private, without the adult 
present. The commenter expressed concern that the exception as written 
could interfere with the autonomy of the individual with LEP seeking 
sexual or reproductive health services, especially if the individual is 
accompanied by an abusive partner that objects to certain sexual and 
reproductive health services.
    Additionally, one commenter noted that the prohibition of an 
accompanying adult acting as an interpreter--absent the individual with 
LEP's consent or in the case of an emergency--is particularly important 
for survivors of domestic and sexual violence. The commenter stated 
that without such a restriction, victims and survivors are faced with 
situations where their abuser, child, or family member may be used to 
interpret traumatic and sensitive information, compounding the risk to 
victims and trauma to themselves as well as their children. Another 
commenter recommended OCR specify that if an individual with LEP 
requests an accompanying adult to facilitate one time, this does not 
mean the covered entity can assume the individual with LEP will 
continue to bring that same adult or choose to use that adult as an 
interpreter for future interactions. The covered entity must offer 
language services each and every time it encounters an individual with 
LEP.
    One commenter requested OCR also address nonemergency situations 
where the patient does not ``specifically request'' that an 
accompanying adult interpret or facilitate communication, but where, 
despite best efforts to find a qualified interpreter, it is not 
possible to find a qualified interpreter for the individual with LEP, 
such as when a patient speaks a rare dialect of a language.
    Response: We appreciate the commenters' concerns regarding when it 
may or may not be appropriate to grant an adult with LEP's request for 
an individual not qualified as an interpreter to interpret or 
facilitate communication. When considering reliance on an accompanying 
adult to interpret, the covered entity must consider whether that 
reliance is appropriate--this includes whether the covered entity 
believes the accompanying adult can adequately convey the information 
being discussed and whether they may have a conflict or bias, as in the 
case of intimate partner violence. Any agreement by a covered entity to 
allow an accompanying adult to interpret or facilitate communication 
may only be at the affirmative and independent request of the 
individual with LEP so as to protect individuals in situations such as 
intimate partner violence, abuse, or trafficking. We clarify that OCR 
appreciates the critical role parents and guardians play in medical 
decision-making for their children and that the rule does not prevent 
parents from being involved in their children's health care decisions. 
To address the concern of coercion and the like, we are finalizing 
Sec.  92.201(e)(2)(ii) to include a requirement that the individual 
with LEP make their request without the accompanying adult present and 
with the services of a qualified interpreter, which does not include 
the exigent circumstances exception found at Sec.  92.201(e)(2)(i).
    Comment: One commenter encouraged OCR to include a specific 
provision at Sec.  92.201(e) ensuring privacy and confidentiality for 
individuals with LEP, such as not having sensitive discussions in 
waiting rooms and other public spaces.
    Response: We appreciate the commenter's concern regarding privacy 
and confidentiality for individuals with

[[Page 37583]]

LEP and restate that one of the key components of the definition of 
``qualified interpreter for an individual with limited English 
proficiency'' is that they must adhere to generally accepted 
interpreter ethics principles, including client confidentiality. 
Additionally, covered entities that are subject to both HIPAA and 
section 1557 must comply with the requirements of both laws.\138\
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    \138\ Determining the relationship between the interpreter and 
the covered entity is a covered entity's HIPAA obligation and is 
unchanged by section 1557 or the part. We encourage covered entities 
to review OCR's HIPAA Frequently Asked Questions (FAQ) regarding 
business associates. See U.S. Health & Hum. Servs., Off. for Civil 
Rts., Health Information Privacy FAQs, https://www.hhs.gov/hipaa/for-professionals/faq/760/must-a-covered-provider-obtain-individual-authorization-to-disclose-to-an-interpreter/.
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    Comment: Several commenters supported the restoration of 
requirements related to video remote interpreting (VRI) for individuals 
with LEP. Commenters noted that the 2020 Rule removed requirements 
related to VRI for individuals with LEP, yet many covered entities use 
video interpreting not only for deaf or hard of hearing patients but 
also patients with LEP. Further, these commenters noted that the 
quality of video interpreting should be the same for all individuals 
who use it. A couple of commenters specifically noted the importance of 
high-quality picture, video, and transmissible audio for all parties in 
order for interpreters to perform their job effectively. For example, 
one commenter noted the importance of restoring VRI standards for 
individuals with LEP given frequent concerns about the poor quality of 
interpreter services using VRI. A couple of other commenters mentioned 
that the use of such technology will facilitate discussion between 
qualified interpreters and individuals with LEP and will also assist 
individuals who may have disabilities who are aided by using such 
technology. One commenter, who supported inclusion of VRI standards, 
recommended in-person interpretation should be sought as a first step 
because it is more responsive than VRI.
    Response: We agree with commenters that it is important to have 
parity in VRI quality standards for all individuals who use it. The 
final rule reinstates the VRI standards from the 2016 Rule, former 45 
CFR 92.201(f), which were based on standards found in the implementing 
regulations for title II of the ADA.\139\ This provision is designed to 
achieve parity with the VRI requirements found in Sec.  92.202 
regarding effective communication for people with disabilities.
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    \139\ See 28 CFR 35.160(d)(1)-(4). In contrast to 28 CFR 
35.160(d)(2), which regulates the size of the video image to ensure 
that the screen shows one's face, arms, hands, and fingers, Sec.  
92.201(f)(2) in this final rule does not regulate the size of the 
video image because this component is less relevant for oral 
interpretation between English and non-English languages or two non-
English spoken languages.
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    We recognize that VRI is not always the most appropriate method for 
providing language assistance services. This provision does not require 
a covered entity to provide VRI but rather ensures that when such 
services are used, they meet a minimum quality standard. To also 
clarify that the language assistance services delivered via VRI must 
provide meaningful access, we are revising Sec.  92.201(f) to require 
that when a covered entity uses VRI services, it ``must ensure the 
modality allows for meaningful access.''
    Comment: A few commenters raised concerns with the proposed 
technical requirements for VRI services. A couple of commenters 
requested OCR provide emergency exceptions for performance standards 
for video remote interpreting. These commenters also expressed concern 
with the requirement that VRI must be over a dedicated high-speed, 
wide-bandwidth video connection or wireless connection since it may be 
difficult to meet that standard in an emergency, such as a natural 
disaster that disrupts access to the high-speed connection.
    Another commenter suggested revising the rule to require covered 
entities to use audio and video communications for interpretation 
services that are consistent with those available in the community 
served by the health program or activity. The commenter explained the 
communications framework in a community, such as a rural community, may 
not fully meet the standards proposed.
    Response: We appreciate commenters' concerns regarding the ability 
to meet the VRI standards proposed. In the event of a natural disaster 
or locations where high-speed wide-bandwidth video capabilities may not 
be available, covered entities may not be able to meet the required 
standards. In these circumstances, a reasonable step to achieving 
meaningful access may be through using the services of a qualified 
interpreter via telephone (or in-person, if available). As in all 
circumstances, OCR will consider the specific facts of whether a 
covered entity has taken reasonable steps to provide meaningful access 
under the circumstances.
    Comment: A couple of commenters recommended that VRI requirements 
be reflective of and adaptable to the specific community or individual. 
One organizational commenter recommended that the rule clarify that 
covered entities should follow an individual's preference with respect 
to interpreter services where appropriate. The commenter noted that the 
majority of their members and patients with LEP communicate through 
telephonic interpretation services and that there are also situations 
where a member or patient may express a preference to use an audio 
interpreter service rather than be required to participate in a video 
session.
    Response: We appreciate commenters' suggestions regarding 
prioritizing an individual with LEP's preference when determining the 
manner in which interpreting services will be provided. However, we 
decline to revise the requirements for VRI standards. These standards 
set minimum requirements for when language assistance services are 
provided via VRI; they do not, however, require a covered entity to use 
such technology. Covered entities are free to use audio-only 
interpretation if that is a reasonable step to provide meaningful 
access to an individual with LEP, including if it is the expressed 
preference of an individual with LEP.
    Comment: A few commenters recommended OCR establish further 
requirements with respect to VRI. These commenters suggested OCR 
specify that the covered entity should be held responsible for ensuring 
that the VRI device connects to a qualified interpreter within five 
minutes of the arrival of the VRI device in the room and ensure that 
there are no interruptions in communication, such as disconnections or 
screensavers. Further, commenters recommended that health care entities 
should have personnel available on a 24-hour basis who are trained and 
able to operate the VRI system efficiently. These commenters stressed 
that hospitals are already responsible for the maintenance and upkeep 
of multiple types of equipment necessary for health care and, as such, 
the same strict standards for optimal operation and upkeep should apply 
to VRI technology as well. A few commenters stated that covered 
entities should have policies and procedures in place to procure video 
remote interpretation.
    Response: OCR appreciates the commenters' recommendations for 
providing further requirements related to VRI. The rule requires that 
language assistance services be provided in a timely manner. We decline 
to mandate a specific time period in which an interpreter must be made 
available once

[[Page 37584]]

a VRI device is present, as it does not allow for the necessary 
flexibility that may be required to account for the specific 
circumstances giving rise to the interaction, such as whether it is 
scheduled or unscheduled. We agree it is important to ensure a covered 
entity has personnel who can maintain and efficiently set up and 
operate VRI technology. To this end, the rule requires covered entities 
to maintain language access procedures per Sec.  92.8(d), and to 
provide adequate training to users of the technology and other involved 
persons so that they may quickly and efficiently set up and operate the 
VRI device per Sec.  92.201(f)(4). Although we support covered entities 
having policies and procedures in place related to the procurement of 
video remote interpretation, we decline to require them to do so 
because we do not believe imposing such a requirement is warranted at 
this time.
    Comment: OCR received a few comments on the standards for audio 
remote interpreting services at Sec.  92.201(g), which were generally 
supportive. One commenter expressed that audio-only interpretation is 
often a poor substitute for video remote or in-person interpretation 
and recommended OCR consider audio-only interpretation to be a last 
resort.
    Response: We appreciate the commenter's concern and recognize that 
audio remote interpreting may not be adequate to provide meaningful 
access to an individual with LEP. However, there are situations in 
which audio remote interpreting may be the only option available to a 
covered entity and so we decline to place further restrictions on its 
use. To address concerns that audio remote interpreting may fail to 
provide meaningful access, we are revising Sec.  92.201(g) to require 
that when a covered entity uses audio remote interpreting services, it 
``must ensure the modality allows for meaningful access.''
    Comment: One commenter recommended OCR explicitly prohibit covered 
entities from coercing individuals with LEP to decline language 
assistance services, which was stated in the preamble to the 2015 NPRM. 
80 FR 54185. The commenter noted that the 2022 NPRM did not capture 
this important concept and covered entities should be prohibited from 
discouraging individuals with LEP from exercising their rights, which 
may be a form of discrimination.
    Response: We appreciate the commenter's concern and reiterate that 
a covered entity may not coerce an individual with LEP to decline 
language assistance services. In the same way that a covered entity is 
prohibited from requiring an individual with LEP to accept language 
assistance services, Sec.  92.201(h), a covered entity similarly cannot 
require or coerce an individual to decline such services.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, OCR is finalizing the provisions as proposed in 
Sec.  92.201, with modifications. In Sec.  92.201(a), we are adding 
``(including companions with limited English proficiency)'' after the 
term ``individual with limited English proficiency.'' In Sec.  
92.201(e)(2), we are deleting the clause ``accompanying a limited 
English proficient individual.'' In Sec.  92.201(e)(2)(i), we are 
replacing ``the accompanying adult'' with ``an initial adult 
interpreter.'' In Sec.  92.201(e)(2)(ii) we are adding the phrase ``in 
private with a qualified interpreter present and without an 
accompanying adult present,'' after ``where the individual with limited 
English proficiency specifically requests.'' In Sec.  92.201(f), we are 
adding the phrase ``ensure the modality allows for meaningful access 
and must . . .'' after ``through video remote interpreting services in 
the covered entity's health programs and activities must . . .'' In 
Sec.  92.201(g), we are adding the phrase ``ensure the modality allows 
for meaningful access and must . . .'' after ``through audio remote 
interpreting services in the covered entity's health programs and 
activities must . . .''
    We are also making technical revisions. Throughout Sec.  92.201, we 
are replacing the term ``limited English proficient individual'' with 
``individual with limited English proficiency.'' In Sec.  92.201(c)(2), 
we are replacing the phrase ``a covered entity must use a qualified 
translator'' with ``a covered entity must utilize the services of a 
qualified translator.'' In Sec.  92.201(e)(2)(ii), we are replacing the 
word ``the'' in the phrase ``by the accompanying adult is documented'' 
with ``by an accompanying adult is documented.'' In Sec.  92.201(e)(4) 
we are striking the word ``directly'' as technically incorrect to 
describe the manner in which a covered entity communicates to an 
individual with LEP via the services of a qualified interpreter or 
qualified translator.
Effective Communication for Individuals With Disabilities (Sec.  
92.202)
    Proposed Sec.  92.202 addressed requirements related to providing 
effective communication for individuals with disabilities.
    In Sec.  92.202(a), we proposed requiring a covered entity to take 
appropriate steps to ensure that communications with individuals with 
disabilities, and companions with disabilities, are as effective as 
communications with individuals without disabilities in its health 
programs and activities, incorporating the standards found at 28 CFR 
35.130 and 35.160 through 35.164 of the regulation implementing title 
II of the ADA.
    In Sec.  92.202(b), we proposed to require covered entities to 
provide appropriate auxiliary aids and services to individuals with 
impaired sensory, manual, or speaking skills, where necessary to afford 
such individuals an equal opportunity to benefit from the service in 
question.
    The comments and our responses regarding Sec.  92.202 are set forth 
below.
    Comment: While commenters generally expressed support for Sec.  
92.202, many discussed the extensive lack of compliance with current 
effective communication requirements under section 1557, section 504, 
and title II of the ADA by covered entities. Some referenced costs as 
the key issue, and one commenter stated that some providers have a 
policy of only providing an interpreter if the cost is covered by the 
patient's health insurance. Another commenter stated that even when the 
State has a Medicaid billing code, the patients still are faced with 
the burden of having to educate prospective providers about the 
availability of the code and the provider's obligation to provide 
auxiliary aids and services.
    Other commenters mentioned that compliance will require 
implementing programs to develop, maintain, and communicate clear 
policies, and train on the provision of language assistance services 
and auxiliary aids and services for effective communication.
    Response: OCR is aware that some covered entities fail to comply 
with their responsibility to ensure effective communication with 
individuals with disabilities, including through requiring an 
individual to bring their own interpreter, only providing interpreter 
services when covered by the individual's health insurance coverage or 
other health-related coverage, or incorrectly citing health privacy 
laws as a reason to not provide interpreter services.
    In an effort to proactively address compliance concerns and 
resulting lack of access to covered health programs and activities, we 
are requiring all covered entities to develop and

[[Page 37585]]

maintain effective communication procedures, per Sec.  92.8(e). OCR 
encourages covered entities to include any necessary billing codes in 
such procedures. We are further requiring covered entities to train 
relevant employees on these procedures, per Sec.  92.9.
    Comment: A patient advocacy group recommended requiring that states 
establish a medical communication access fund that pools fees from 
State-mandated medical licenses to pay for effective communication. The 
commenter expressed that this method spreads out the costs of auxiliary 
aids and services so that no single covered entity bears the costs.
    Response: All covered entities must provide auxiliary aids and 
services when needed to communicate effectively with people with 
disabilities. OCR encourages covered entities to develop creative 
approaches to support the provision of these required aids and 
services. OCR declines to include a specific requirement for states to 
establish mandatory medical communication access funds in this 
rulemaking as such a requirement would exceed the authority granted to 
OCR for this rulemaking.
    Comment: Some commenters expressed appreciation and support for the 
inclusion of ``companions'' in the text of Sec.  92.202. One commenter 
added that doctors and hospitals have told patients that their legal 
counsel informed them that they are not obligated to provide 
communication access to anyone who is not a patient. One commenter 
recommended that OCR include that the selection of ``appropriate'' 
companion(s) be made by the individual not the provider.
    Response: Section 1557 requires that covered entities ensure 
effective communication for individuals with disabilities, including 
companions. The definition in Sec.  92.4 is consistent with the 
definition of ``companion'' from the implementing regulations for title 
II of the ADA, which similarly requires that a public entity ``take 
appropriate steps to ensure that communications with . . . companions 
with disabilities are as effective as communications with others.'' 28 
CFR 35.160(a).
    Comment: A couple of commenters mentioned that patients are 
sometimes told that due to confidentiality they cannot have a friend, 
family member, advocate, or attorney be present for an appointment for 
effective communication purposes. One commenter provided the following 
example: An individual with Autism Spectrum Disorder (ASD) was required 
to enter the hospital without his mom, who could assist him in 
communicating, and likely because of that he was misdiagnosed and 
required to return to the emergency room within a week.
    Response: Unless a covered entity has a specific confidentiality 
concern regarding the presence of a specific companion, the individual 
with a disability should be permitted to select a companion and have 
them present when accessing a covered health program or activity. 
Further, and consistent with instruction under the ADA, a companion may 
need to help the patient with information or instructions given by 
hospital personnel.\140\ Companions may be an essential part of 
ensuring an individual with a disability is afforded effective 
communication and should not be separated from an individual with a 
disability outside of extenuating circumstances. However, we note that 
a covered entity may not rely on a person accompanying an individual 
with a disability to interpret or otherwise facilitate communication; 
this is only permitted when the individual with a disability 
specifically requests that an accompanying adult interpret or 
facilitate communication, the accompanying adult agrees to provide such 
assistance, and reliance on that adult for such assistance is 
appropriate under the circumstances. See 28 CFR 35.160(c)(2)(ii), 
incorporated by Sec.  92.202.
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    \140\ 75 FR 56183, 56223-24 (Sept. 15, 2010).
---------------------------------------------------------------------------

    Comment: Several commenters thanked OCR for proposing to restore 
the requirements for quality measures in VRI, while some raised 
concerns regarding the appropriateness of VRI in various circumstances. 
They shared that, for example, VRI may not be effective for a person 
lying on their back for a medical procedure due to challenges with 
viewing the screen and that VRI has been inappropriately used during 
high-risk childbirth. Yet another commenter mentioned that VRI is not 
appropriate for individuals who are deafblind (i.e., individuals who 
have combined hearing and vision loss that limit access to both 
auditory and visual information). One commenter expressed concern that 
a provider made it a policy that their facility only uses VRI and never 
uses the services of in-person interpreters.
    Response: We acknowledge the concerns with VRI and note that it may 
not provide effective communication for all individuals in all 
situations. Covered entities are required to take appropriate steps to 
ensure that communications with individuals with disabilities are as 
effective as communications with individuals without disabilities in 
their health programs and activities. If the use of VRI does not 
provide an individual equal opportunity to participate in or benefit 
from the service in question, then the communication is ineffective and 
does not meet section 1557 requirements.
    Several cases have found that VRI was ineffective due to hospital 
staff's lack of knowledge about how to operate the VRI equipment or 
technology issues with the equipment itself, including the attempted 
use of VRI during labor.\141\ Settlement agreements with the United 
States have similarly found concerns with VRI, including one settlement 
decree that specified that VRI would not be considered effective in 
specific situations, including situations due to: ``(1) a patient's 
limited ability to move his or her head, hands or arms; vision or 
cognitive issues; or significant pain; (2) space limitations in the 
room; (3) the complexity of the medical issue; or (4) any other time 
when there are indicators that VRI is not providing effective 
communication.'' \142\
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    \141\ Sunderland v. Bethesda Hosp., Inc., 686 F. App'x 807 (11th 
Cir. 2017); Silva v. Baptist Health S. Fla., Inc., 303 F. Supp. 3d 
1334 (S.D. Fla. 2018), aff'd in part, vacated in part, remanded, 838 
F. App'x 376 (11th Cir. 2020); Juech v. Children's Hosp. & Health 
Sys., Inc., 353 F. Supp. 3d 772 (E.D. Wis. 2018); Settlement 
Agreement Between the United States of America and Floyd Medical 
Center (2016), https://archive.ada.gov/floyd_sa.html; see also 
Manako Yabe, Healthcare Providers' and Deaf Patients' Interpreting 
Preferences for Critical Care and Non-Critical Care: Video Remote 
Interpreting, 13.2 Disability and Health J. 100870 (2020), https://pubmed.ncbi.nlm.nih.gov/31791822/; Nat'l Ass'n for the Deaf, Minimum 
Standards for Video Remote Interpreting Services in Medical 
Settings, https://www.nad.org/about-us/position-statements/minimum-standards-for-video-remote-interpreting-services-in-medical-settings/.
    \142\ Settlement Agreement Between the U.S. and Swedish Edmonds 
Hospital (2014), https://archive.ada.gov/swedish_edmonds_sa.htm; 
Settlement Agreement Between the U.S. and Grady Memorial Hospital 
(2016), https://archive.ada.gov/grady_sa.html.
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    This enforcement activity suggests that VRI may not always afford a 
person with a disability an equal opportunity to participate in and 
enjoy the benefits of the program or activity of a covered entity. 
Thus, policies that require the exclusive use of VRI, or the exclusive 
use of any particular auxiliary aid or service, are likely to result in 
the eventual failure to provide effective communication and therefore 
should not be adopted.
    Comment: One patient advocacy group recommended that OCR emphasize 
that family members should not act as interpreters for a deaf or hard 
of hearing patient, except in certain exigent circumstances.

[[Page 37586]]

    Response: Covered entities are responsible for providing effective 
communication, including through utilizing the services of a qualified 
interpreter, and cannot require an individual to bring someone to 
interpret for them. Persons with disabilities can, however, bring an 
interpreter of their choosing, including a family member, and OCR 
declines to add the suggested language prohibiting this choice. This 
approach is consistent with existing ADA title II regulations, 28 CFR 
35.160(c), and with the approach OCR has followed in the section 504 
proposed rule. 88 FR 63392, 63508 (Sept. 14, 2023) (proposed 45 CFR 
84.77(c)(2)(ii)).
    Comment: One group recommended that the final rule include language 
that requires health care entities to consider a patient's preference 
for gender of the interpreter as a means of ensuring more effective 
communication. This group noted that given the intimate nature of 
medical assessments and treatments, patients may not be comfortable 
with an interpreter of a different gender than themselves, particularly 
in settings that involve nudity such as in an obstetrics and gynecology 
appointment.
    Response: While OCR appreciates that a patient may prefer an 
interpreter of a particular gender and recommends consideration of a 
patient's preference for a particular gender whenever possible, 
including when the request is made based on an individual's religious 
practices and beliefs, we decline to include such language in the rule 
regarding the gender of a qualified interpreter for an individual with 
a disability. OCR notes that some organizations, such as the National 
Association of the Deaf and Deaf Seniors of America, have issued 
position statements to guide providers in adopting internal VRI 
policies, and have stated that medical providers ``shall honor the 
preference of the deaf or hard of hearing patient and/or companion with 
respect to the gender of video interpreter.'' \143\ However, OCR notes 
that whether a covered entity has ensured their communication is 
effective for an individual with disability does not inherently depend 
on whether the covered entity is able to satisfy a patient's preference 
regarding the interpreter's gender.
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    \143\ Nat'l Ass'n of the Deaf, Minimum Standards for Video 
Remote Interpreting Services in Medical Settings, https://www.nad.org/about-us/position-statements/minimum-standards-for-video-remote-interpreting-services-in-medical-settings/.
---------------------------------------------------------------------------

    Comment: An organizational commenter said that providers should be 
required to ``affirmatively ask'' patients what they need to make 
documents accessible and should document that requirement so that it 
does not need to be repeatedly asked and answered.
    Response: OCR understands the frustration experienced by 
individuals who have to inform their providers of their need to receive 
communication in accessible formats multiple times. We note that the 
Department has implemented a process by which Medicare beneficiaries 
who are blind or have low vision can request Medicare Summary Notices 
in an accessible format, and following the initial request, the 
required accessible format will be the default format of the document 
mailed to the beneficiary.\144\ We recognize this as a best practice, 
and while we decline to require that such need be documented, we 
encourage covered entities to implement such a practice in the written 
effective communication procedures required under Sec.  92.8(e).
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    \144\ Beneficiaries can find information on how to request 
Medicare Summary Notices in accessible formats at Medicare.gov, 
Accessibility & Nondiscrimination Notice, https://www.medicare.gov/about-us/accessibility-nondiscrimination-notice; see also 88 FR 
22120, 22122 (April 12, 2023).
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    Comment: Some organizational commenters urged OCR to incorporate 
the following OCR guidance documents directly into the final 
regulations, as well as all subsequent similar guidance, technical 
assistance, and enforcement activities: enforcement efforts related to 
support persons in hospital settings \145\ and Bulletin on Civil 
Rights, HIPAA, and the Coronavirus Disease 2019.\146\
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    \145\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
OCR Resolves Complaints after State of Connecticut and Private 
Hospital Safeguard the Rights of Persons with Disabilities to Have 
Reasonable Access to Support Persons in Hospital Settings During 
COVID-19 (June 9, 2020), https://public3.pagefreezer.com/content/HHS.gov/31-12-2020T08:51/https://www.hhs.gov/about/news/2020/06/09/ocr-resolves-complaints-after-state-connecticut-private-hospital-safeguard-rights-persons.html.
    \146\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
March 28, 2020 BULLETIN: Civil Rights, HIPAA, and the Coronavirus 
Disease 2019 (COVID-19) (Mar. 28, 2020), https://www.hhs.gov/guidance/document/march-28-2020-bulletin-civil-rights-hipaa-and-coronavirus-disease-2019-covid-19.
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    Response: OCR thanks commenters for their suggestion to incorporate 
guidance and enforcement materials into the final rule. Guidance 
documents advise members of the public how an agency understands its 
legal authorities.\147\ Similarly, covered entities and others may be 
able to look to OCR's enforcement to gain clarity regarding regulatory 
requirements. As guidance, technical assistance, and enforcement 
activities are constantly evolving, we decline to codify the referenced 
materials in this rule.
---------------------------------------------------------------------------

    \147\ Kisor v. Wilkie, 139 S. Ct. 2400, 2420 (2019) (plurality 
opinion) (quoting Perez v. Mortgage Bankers Ass'n, 575 U.S. 92, 97 
(2015)).
---------------------------------------------------------------------------

    Comment: Multiple commenters, including organizations, recommended 
that Sec.  92.202(b) explicitly parallel the language in Sec.  
92.201(b) by stating that auxiliary aids and services must be provided 
free of charge, be accurate and timely, and protect the privacy and the 
independent decision-making of the individual with a disability. The 
commenters noted that while this section adopts by reference 28 CFR 
35.160 through 35.164 (ADA title II communication requirements), some 
covered entities may simply read the regulatory language and note the 
difference in language between Sec. Sec.  92.201 and 92.202. Noting 
this difference, several commenters also requested that OCR develop 
technical assistance materials on 28 CFR 35.160 through 35.164 in plain 
language.
    Response: Like multiple places in this regulation, the text of 
Sec.  92.202 adopts ADA title II standards by reference, including the 
requirements related to auxiliary aids and services. OCR appreciates 
the concerns raised by commenters regarding the apparent lack of parity 
between Sec. Sec.  92.201(b) and 92.202(b), and how this may lead to 
confusion on behalf of covered entities and the public and may increase 
the likelihood that individuals with disabilities may either not 
receive or may be required to pay for auxiliary aids and services. 
Therefore, in light of comments received and continued compliance 
concerns, we are revising Sec.  92.202(b) as follows.
    First, OCR is revising the text, consistent with 28 CFR 
35.160(b)(1), to clarify that all individuals with disabilities must be 
afforded appropriate auxiliary aids and services and an equal 
opportunity to ``participate in and enjoy the benefits of'' the health 
program or activity in question.
    Further, OCR agrees with commenters that it is important that those 
reading this regulation can immediately identify that appropriate 
auxiliary aids and services must be provided free of charge. Some 
commenters and our enforcement experience demonstrate that this 
requirement, similar to that in the ADA and section 504, is not always 
clear or adhered to by covered entities. Thus, OCR is adding a sentence 
to Sec.  92.202(b) stating that auxiliary aids and services must be 
provided free of charge. OCR notes that this is similar to the approach 
taken in DOJ's implementing regulations for title II and title III of 
the ADA, which forbid surcharges on persons with disabilities or groups 
of persons with disabilities to

[[Page 37587]]

cover the provision of auxiliary aides and services. 28 CFR 35.130(f) 
(title II), 36.301(c) (title III). For parity with 28 CFR 36.160(b)(2) 
and 45 CFR 92.201(b), we are also revising the text to clarify that 
auxiliary aids and services must be provided in accessible formats, in 
a timely manner, and in such a way to protect the privacy and the 
independence of the individual with a disability.
    OCR appreciates commenters' suggestion to develop technical 
assistance materials regarding effective communication under 28 CFR 
35.130 and 35.160 through 35.164. These are regulations promulgated and 
enforced by DOJ, and we will continue to coordinate and collaborate 
with DOJ to develop technical assistance materials related to effective 
communication requirements under our respective authorities.\148\
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    \148\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Disability Resources for Effective Communication, https://www.hhs.gov/civil-rights/for-individuals/special-topics/hospitals-effective-communication/disability-resources-effective-communication/; see also Medicaid.gov, Unwinding 
Documents, https://www.medicaid.gov/resources-for-states/coronavirus-disease-2019-covid-19/unwinding-and-returning-regular-operations-after-covid-19/state-letters/.
---------------------------------------------------------------------------

    Comment: A few organizational commenters argued that the provision 
of auxiliary aids and services is necessary but not a sufficient tool 
for avoiding and remedying effective communication discrimination. The 
commenters said that individuals who cannot rely on natural speech for 
effective communication require ``effective access to the robust 
language-based alternative and augmentative communication they need to 
express themselves and be understood.'' Another group said that OCR 
should expand on the definition of ``auxiliary aids and services'' to 
include plain language and screen reader capabilities.
    Response: Covered entities are required take appropriate steps to 
ensure effective communication. Though the provision of appropriate 
auxiliary aids and services is addressed in Sec.  92.202(b), the 
examples of auxiliary aids and services provided at Sec.  92.4 
(Definitions) is non-exhaustive and covered entities may use additional 
auxiliary aids and services to achieve effective communication.
    Effective communication for patients with cognitive, neurological, 
and psychiatric disabilities may require auxiliary aids and services or 
strategies different from those employed with patients with other 
disabilities. For example, while an individual who is deaf or hard of 
hearing may require an ASL interpreter to effectively communicate with 
a provider, an individual with a cognitive disability may require 
additional time with the provider to ask questions and receive plain 
language answers about a specific health care decision.
    In addition, one type of auxiliary aid or service that may be 
required is the acquisition or modification of equipment or devices, 
including for augmentative and alternative communication, and the 
provision of training and assistance to the individual with a 
disability on how to use them. Augmentative and alternative 
communications devices include, but are not limited to, speech 
generating devices, single-message devices, computers, tablets, 
smartphones, amplification devices, telecommunications devices, voice 
amplifiers, artificial phonation devices, picture and symbol boards, 
paper-based aids, and other equipment or devices used to compensate for 
impairments to speech-language production or comprehension, including 
spoken and written modes of communication. In some instances, the use 
of augmentative and alternative communication is necessary for 
individuals with certain disabilities that impair speech production and 
comprehension to access vital health and human services programs and 
activities. Often, the most effective way for recipients to ensure 
effective communication is to provide training on the use of this 
equipment.
    Comment: A health care organization requested that this provision 
should be modified to state that covered entities ``must make a 
reasonable attempt'' to provide auxiliary aids and services, ``unless 
the covered entity can demonstrate that providing such auxiliary aids 
or services would fundamentally alter the nature of the service in 
question or result in an undue burden, i.e., significant difficulty or 
expense.''
    Response: OCR declines to modify the standard for effective 
communication, which requires that covered entities ensure that 
communications with people with disabilities are as effective as 
communications with others. The language on fundamental alteration or 
undue burden related to the provision of communications, found in 28 
CFR 35.164, is already adopted into this section by reference.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.202, with modification. We are revising Sec.  92.202(b) to 
read: ``A covered entity must provide appropriate auxiliary aids and 
services where necessary to afford individuals with disabilities an 
equal opportunity to participate in, and enjoy the benefits of, the 
health program or activity in question. Such auxiliary aids and 
services must be provided free of charge, in accessible formats, in a 
timely manner, and in such a way to protect the privacy and the 
independence of the individual with a disability.''
Accessibility for Buildings and Facilities (Sec.  92.203)
    In Sec.  92.203, we proposed adding a general provision 
establishing that no qualified individual with a disability shall, 
because a covered entity's facilities are inaccessible to or unusable 
by individuals with disabilities, be denied the benefits of, be 
excluded from participation in, or otherwise be subjected to 
discrimination under any health program or activity to which this part 
applies, consistent with OCR's section 504 regulation. OCR also 
proposed incorporating the identical language found in the 2020 Rule at 
Sec.  92.103, except that the definitions for 1991 Americans with 
Disabilities Act Standards for Accessible Design (1991 ADA Standards), 
2010 ADA Standards for Accessible Design (2010 ADA Standards), and 
Uniform Federal Accessibility Standards (UFAS), Public Law 90-480; 42 
U.S.C. 4151 et seq., are now located in Sec.  92.4.
    OCR also notes that the section 504 regulatory provisions 
incorporated into subpart B in this regulation contain program 
accessibility requirements that apply to existing facilities as well as 
new construction and alterations. Title II of the ADA and section 504 
require that covered entities operate their programs and activities so 
that, when viewed in their entirety, they are readily accessible to 
individuals with disabilities; neither statute has been interpreted to 
require that each existing facility be made accessible.\149\ Nearly all 
of the entities subject to the facility access requirements in the 
final rule are also subject to facility access requirements under 
section 504 and the ADA. Section 92.203 establishes specific 
accessibility standards for new construction and alterations under 
section 1557.
---------------------------------------------------------------------------

    \149\ See 28 CFR 35.150(a); 45 CFR 84.22(a); Bird v. Lewis & 
Clark Coll., 303 F.3d 1015, 1021 (9th Cir. 2002) (``the central 
inquiry [under the ADA and section 504] is whether the program, when 
viewed in its entirety is readily accessible to and usable by 
individuals with disabilities'').
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    The comments and our responses regarding Sec.  92.203 are set forth 
below.
    Comment: Some commenters emphasized the importance of a

[[Page 37588]]

continued push towards universal compliance with the 2010 ADA 
Standards. Many commenters also noted how critical it would be for OCR 
to provide oversight to ensure that covered entities' buildings and 
facilities come into compliance with the 2010 ADA Standards. These 
commenters also noted that the uniform application of the 2010 ADA 
Standards will also enable greater consistency among implementing 
agencies.
    Response: OCR appreciates the comments regarding the existing 
standards and the push towards universal compliance with the 2010 ADA 
Standards and will continue to retain the requirement that new 
construction or alteration of buildings or facilities must comply with 
the 2010 ADA Standards.
    Comment: Some commenters did not support the incorporation of 45 
CFR 84.23(c) at Sec.  92.101(b) because they stated it would allow 
facilities to only conform with UFAS instead of the more recent 1991 
ADA Standards or 2010 ADA Standards. They also expressed concern that 
the application of the UFAS to new facilities would be outdated. These 
commenters believe that the UFAS permits facilities to maintain 
barriers that exclude people with disabilities that impact their 
mobility or strength.
    Response: OCR appreciates the commenters concerns regarding the 
incorporation of the UFAS. However, this rule does not allow UFAS to be 
used as the accessibility standard for new facilities. UFAS is only 
used to determine if a building built before July 18, 2016, was 
designed and constructed in accordance with the standards at the time. 
Any alteration or addition of any building or facilities built after 
July 18, 2016, must follow the 2010 ADA Standards.
    Comment: Some commenters also recommend incorporating existing 
standards relating to accessible Medical and Diagnostic Equipment (MDE) 
that were developed by the U.S. Access Board. 82 FR 2810 (Jan. 9, 
2017), codified at 36 CFR part 1195 (U.S. Access Board 2017 Standards 
for MDE). Commenters also noted that the lack of access to MDE should 
constitute both a discriminatory benefit design and network inadequacy.
    Response: On September 14, 2023, OCR published a NPRM proposing 
modifications to the implementing regulations for section 504. The NPRM 
proposes adopting the U.S. Access Board 2017 Standards for MDE used by 
recipients of Federal financial assistance to ensure accessibility for 
patients with disabilities. 88 FR 63450-55, 63511 (proposed 45 CFR 
84.92). OCR will continue to address accessible MDE in that rulemaking.
Summary of Regulatory Changes
    For the reasons set forth above and considering the comments 
received, we are finalizing the provisions as proposed in Sec.  92.203 
with modification. We are making two technical corrections to add ``or 
alteration'' after ``construction'' in Sec.  92.203(b) and (c) for 
consistency with the description of the 2010 Standards elsewhere in the 
provision. We have replaced the phrase ``and such facility was not 
covered by the 1991 Standards or 2010 Standards'' in Sec.  92.203(c) 
with ``and such facility would not have been required to conform with a 
different accessibility standard under 28 CFR 35.151'' for clarity and 
consistency. We have also added language clarifying the timeframes for 
compliance with either the 2010 Standards or the UFAS standards for 
existing facilities where construction or alteration was begun on or 
after July 18, 2016, and on or before January 18, 2018, in conformance 
with UFAS but the facility or part of the facility was not covered by 
the 2010 Standards. That addition reads, ``If construction or 
alteration was begun on or after July 18, 2016, and on or before 
January 18, 2018, in conformance with UFAS, and the facility or part of 
the facility was not covered by the 2010 Standards prior to July 18, 
2016, then it shall be deemed to comply with this section requirements 
of this section and with 45 CFR 84.23(a) and (b).''
Accessibility of Information and Communication Technology for 
Individuals With Disabilities (Sec.  92.204)
    Proposed Sec.  92.204 addressed the accessibility of information 
and communication technology (ICT) for individuals with disabilities.
    In Sec.  92.204(a), OCR proposed requiring covered entities to 
ensure that their health programs and activities provided through ICT 
are accessible to individuals with disabilities, unless doing so would 
result in undue financial and administrative burdens or a fundamental 
alteration in the nature of the health programs or activities. If an 
action required to comply with this subpart would result in such an 
alteration or burdens, a covered entity is required to take any other 
action that would not result in such an alteration or burdens but would 
nevertheless enable, to the maximum extent possible, individuals with 
disabilities to receive the benefits or services of the health program 
or activity provided by the covered entity.
    In Sec.  92.204(b), OCR proposed requiring recipients and State 
Exchanges to ensure that their health programs and activities provided 
through websites and mobile applications comply with the requirements 
of section 504 as interpreted in a manner consistent with title II of 
the ADA.
    Given the crucial role that ICT can play for individuals with 
disabilities accessing health programs and activities, OCR sought 
comment on whether the section 1557 rule should include a provision 
requiring covered entities to comply with specific accessibility 
standards, such as the Web Content Accessibility Guidelines (WCAG) 
developed by the Web Accessibility Initiative. Additionally, OCR 
invited comments on whether to adopt a safe harbor provision under 
which covered entities that are in compliance with established specific 
accessibility standards are deemed in compliance with proposed Sec.  
92.204(a) and (b); whether OCR should require covered entities to 
comply with the most recent edition of a published standard; and the 
timeline necessary for covered entities to come into compliance with a 
new standard.
    The comments and our responses regarding Sec.  92.204 are set forth 
below.
    Comment: Many commenters, including civil rights groups, health 
care organizations, and a group of Federal elected officials, expressed 
general support for the ICT requirements for people with disabilities 
in the Proposed Rule. Several commenters said they are concerned that 
this section only focuses on accessibility for individuals with 
disabilities, saying that this section should be applicable to all 
individuals covered by section 1557. These commenters noted that 
section 1557's nondiscrimination mandate guards against discrimination 
on the basis of race, color, national origin, sex, and age, as well as 
disability. Therefore, these commenters recommended that Sec.  92.204 
provide that covered entities must ensure that their health programs or 
activities provided through ICT are accessible to individuals on all 
protected bases, not just disability.
    Response: Section 92.204 prohibits discrimination based on 
disability in health programs and activities provided through ICT 
because individuals with certain disabilities are often unable to 
access certain aspects of ICT when that ICT is not developed to be 
accessible. For example, OCR has received complaints from people with 
disabilities, including those who are blind or have low vision, 
alleging that the ICT of covered entities is

[[Page 37589]]

inaccessible to them and not compatible with screen reader software, 
resulting in a denial of access to health programs and activities. 
While Sec.  92.204 addresses ICT accessibility issues for individuals 
with disabilities, it does not limit the application of general 
nondiscrimination principles found throughout section 1557 regulations 
to the accessibility of health programs and activities offered through 
ICT to other groups. Thus, the general prohibition against 
discrimination set forth in Sec.  92.101(a) requires the accessibility 
of health programs and activities offered through ICT, without 
discrimination on the basis of race, color, national origin, sex, age, 
or disability.
    Comment: Several groups recommended adding that ``covered entities 
must procure, design, maintain and use accessible ICT in all aspects of 
providing health programs and activities'' to remind covered entities 
that their civil rights obligations apply in procurements. One group 
said that OCR should clarify that covered entities should be aware that 
third-party providers of ICT are not directly covered by this 
regulation, and that covered entities are obligated to ensure that they 
procure ICT that is accessible. Several commenters suggested the use of 
a Voluntary Product Accessibility Template,\150\ a document that 
indicates compliance with section 508 standards,\151\ should be 
completed by the third-party vendors.
---------------------------------------------------------------------------

    \150\ Section508.gov, Voluntary Product Accessibility Template 
(VPAT), https://www.section508.gov/sell/vpat/.
    \151\ 36 CFR part 1194, appendix A. Section 508 of the 
Rehabilitation Act imposes accessibility requirements for 
information and communication technology that Federal departments 
and agencies develop, procure, maintain, or use.
---------------------------------------------------------------------------

    Response: Regardless of the method that a covered entity uses to 
acquire ICT, the health programs and activities it provides through 
that ICT must be accessible to individuals with disabilities. Due to 
the increasing importance of ICT in the provision of health care, 
health insurance coverage, and other health-related coverage, OCR will 
continue to closely monitor this area. Both OCR and DOJ recently issued 
NPRMs addressing the accessibility of web content and mobile apps used 
by recipients of Federal financial assistance and public entities, 
respectively.\152\ Those rulemakings provide greater clarity on 
obligations to ensure that web content and mobile applications are 
accessible.
---------------------------------------------------------------------------

    \152\ 88 FR 63392 (Sept. 14, 2023) (HHS) and 88 FR 51948 (Aug. 
4, 2023) (DOJ).
---------------------------------------------------------------------------

    Comment: An organizational commenter asked OCR to provide more 
guidance on what constitutes undue burden or fundamental alteration.
    Response: This rulemaking does not create a different standard for 
fundamental alteration or undue burden beyond the standards in section 
504 and the ADA. As DOJ noted in its August 4, 2023 NPRM, 
Nondiscrimination on the Basis of Disability; Accessibility of Web 
Information and Services of State and Local Government Entities, there 
are current undue burden and fundamental alteration limitations in the 
ADA title II regulation that are familiar to public entities. 88 FR 
51948, 51978. The current limitations are in the ADA title II 
implementing regulation at 28 CFR 35.150(a)(3) (program accessibility) 
and 35.164 (effective communication) for fundamental alteration and 
undue burden limitations and 28 CFR 35.130(b)(7) (reasonable 
modifications in policies, practices, or procedures) for fundamental 
alteration limitations. DOJ also provides additional context for 
fundamental alteration and undue burden on its ADA.gov website.\153\ 
Additionally, DOJ's technical assistance manual on title III of the ADA 
provides guidance on what constitutes fundamental alteration and undue 
burden for public accommodations under title III.\154\
---------------------------------------------------------------------------

    \153\ See U.S. Dep't of Justice, State and Local Governments, 
https://www.ada.gov/topics/title-ii/.
    \154\ See U.S. Dep't of Justice, ADA Title III Technical 
Assistance Manual, https://www.ada.gov/resources/title-iii-manual/. 
This guidance document on title III of the ADA defines fundamental 
alteration as ``a modification that is so significant that it alters 
the essential nature of the goods, services, facilities, privileges, 
advantages, or accommodations offered.'' It defined undue burden as 
a ``significant difficulty or expense'' that can be determined based 
on the nature and cost of the action, the overall financial 
resources of the site involved, geographical separateness, overall 
financial resources of the parent entity, and the type of operation 
of the parent entity.
---------------------------------------------------------------------------

    Comment: A professional association asked OCR to work with small, 
independent, and under-resourced physician practices to ensure they 
have the resources, tools, and financial assistance necessary to ensure 
ICT accessibility for patients with disabilities.
    Response: OCR will continue to develop technical assistance and 
educational materials to assist covered entities' compliance with 
section 1557 and this regulation. However, we are unable to provide 
other resources or financial assistance to ensure ICT accessibility.
    Comment: One organizational commenter said that OCR should provide 
technical assistance to covered entities servicing populations with 
digital inequities, such as populations of older adults that may not be 
as digitally savvy or individuals who do not have stable internet 
connections.
    Response: OCR recognizes that many people lack internet 
connectivity and may therefore be unable to access web-based tools and 
resources provided by covered entities, and OCR encourages entities to 
develop creative means to meet the needs of these individuals. However, 
though this issue may raise civil rights concerns in some contexts, it 
is outside the scope of this regulation.
    Covered entities have general nondiscrimination obligations under 
Sec.  92.101(a), including that a covered entity may not discriminate 
based on age. Accordingly, covered entities that use web-based health 
programs and activities must ensure that older adults are not denied 
participation, denied benefits, or otherwise discriminated against in 
the provision of those web-based health programs and activities. For 
example, a covered entity may not decline to provide an electronic 
appointment reminder to an older individual because of a stereotype 
that older individuals may experience difficulties using such 
technology.
    Comment: One organizational commenter recommended extending the 
full ICT requirements to recipients and State exchanges.
    Response: Recipients and State Exchanges are required to comply 
with both Sec.  92.204(a) and (b), per the text of the section.
    Comment: Multiple commenters requested the explicit inclusion of 
mobile applications within this section. They stated that it would spur 
greater awareness among software developers of the need for fully 
accessible mobile applications that are also compatible with mobile 
devices and internet platforms. One organizational commenter warned 
that there could be privacy concerns with certain mobile apps used for 
substance use disorder treatment and recommended that OCR collaborate 
with the Substance Abuse and Mental Health Services Administration 
(SAMHSA) to determine if Federal privacy laws apply to mobile 
application health information, and communicate that information to 
consumers.
    Response: OCR appreciates these comments. Mobile applications are a 
form of information and communication technology and are explicitly 
included in the regulatory text under Sec.  92.204(b); thus, to the 
extent covered entities use mobile applications as part of their health 
programs and activities they must be accessible for individuals with 
disabilities. Though privacy protections are outside of the scope of 
this rulemaking, OCR reminds commenters

[[Page 37590]]

that it has issued guidance on the application of the HIPAA Privacy, 
Security, and Breach Notification Rules to mobile health apps.\155\
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    \155\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Resources for Mobile Health Apps Developers, https://www.hhs.gov/hipaa/for-professionals/special-topics/health-apps/; U.S. 
Dep't of Health & Hum. Servs., Off. for Civil Rts., Protecting the 
Privacy and Security of Your Health Information When Using Your 
Personal Cell Phone or Tablet, https://www.hhs.gov/hipaa/for-professionals/privacy/guidance/cell-phone-hipaa/.
---------------------------------------------------------------------------

    Comment: Many commenters recommended OCR require covered entities 
to comply with specific accessibility standards, such as section 508 
standards, the WCAG 2.0 standards, the WCAG 2.1 standards, or other 
standards that provide equal or greater accessibility. Several 
commenters, including organizations, recommended requiring covered 
entities to comply over time with the latest WCAG as they are updated 
by the Web Accessibility Initiative of the World Wide Web Consortium 
(W3C). The commenters also said that a requirement to adhere to the 
latest standards could offer a range of time for compliance, with 
larger entities that have more resources being required to comply with 
a new WCAG standard within a shorter timeline than smaller entities. A 
technology company said that OCR should not establish a requirement to 
conform to the latest standard, but rather a requirement to conform to 
technical specifications that are proven and generally accepted for 
achieving and maintaining reasonable levels of accessibility; currently 
that is WCAG 2.1 levels A and AA.
    Some organizational commenters suggested that OCR should 
incorporate a functional, evergreen standard for accessibility that 
will adapt to changes in technology and accessibility practices. Such a 
standard would require the ICT to be perceivable, operable, 
understandable, and robust, and ``enable individuals with disabilities 
to access the same information as, to engage in the same interactions 
as, to communicate and to be understood as effectively as, and to enjoy 
the same services offered to other individuals with the same privacy, 
same independence, and same ease of use as, individuals without 
disabilities.''
    Several commenters, including health care organizations, advocacy 
groups, and a trade association, offered suggestions for the timeline 
for compliance with new standards. These included 60 days, 12 months, 
18 months, and 2 years. A health care organization recommended that OCR 
only require initial compliance in fields that are ``critical to 
utilizing telehealth services'' and that covered entities be required 
to meet the minimum conformance levels of the two most recent versions 
of the W3C guidelines.
    Some commenters supported compliance with accessibility standards, 
provided that OCR conducts real-world testing with successful results 
across a variety of physician offices before requiring compliance. The 
commenter also suggested that OCR work with the Office of the National 
Coordinator for Health Information Technology and vendors to ensure 
that compliance does not place an undue financial or administrative 
burden on physician practices. Expressing concern about the cost of 
compliance, a professional association requested an exemption for 
businesses classified as small businesses by the Small Business 
Administration.
    A few commenters, including a trade association, health care 
organizations, and health insurance entities, suggested that OCR 
establish a safe harbor by which covered entities compliant with WCAG 
2.1 Level AA are deemed in compliance with the section 1557 
requirements. Other commenters argued that OCR should not establish a 
safe harbor because compliance with a set of accessibility standards is 
not necessarily evidence of compliance with accessibility requirements; 
there may be ICT that meets published standards but remains 
inaccessible. Another commenter said OCR should not establish a safe 
harbor because the ADA, the Rehabilitation Act, and other Federal laws 
must continue to provide standalone protections.
    Response: OCR appreciates commenters' input on this important topic 
but has decided not to adopt specific accessibility standards or a safe 
harbor at this time. This is in part due to OCR and DOJ recently 
publishing NPRMs proposing specific accessibility requirements for 
section 504 and title II of the ADA, respectively.\156\ Those NPRMs 
propose to require that recipients of Federal financial assistance and 
public entities must ensure that their web content and mobile 
applications comply with set accessibility standards. In this 
rulemaking, OCR continues to require covered entities to ensure that 
health programs and activities provided through ICT are accessible to 
individuals with disabilities sufficient to provide equal access to the 
health program or activity, unless doing so would impose undue 
financial and administrative burdens or would result in a fundamental 
alteration in the nature of the entity's health program or activity. 
OCR strongly encourages covered entities that offer health programs and 
activities through ICT to incorporate current WCAG standards as they 
take steps to ensure that those programs and activities comply with 
requirements of this regulation and other Federal civil rights laws.
---------------------------------------------------------------------------

    \156\ See 88 FR 63392 (Sept. 14, 2023) (section 504) and 88 FR 
51948 (Aug. 4, 2023) (ADA title II).
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.204, without modifications.
Requirement To Make Reasonable Modifications (Sec.  92.205)
    In Sec.  92.205, we proposed requiring covered entities to make 
reasonable modifications to policies, practices, or procedures when 
such modifications are necessary to avoid discrimination on the basis 
of disability, unless the covered entity can demonstrate that making 
the modifications would fundamentally alter the nature of the health 
program or activity. Section 92.205 is the same as Sec.  92.205 in the 
2016 Rule and Sec.  92.105 in the 2020 Rule. The term ``reasonable 
modifications'' will be interpreted as set forth in the regulation 
implementing title II of the ADA at 28 CFR 35.130(b)(7), such that ``[a 
covered entity] shall make reasonable modifications in policies, 
practices, or procedures when the modifications are necessary to avoid 
discrimination on the basis of disability, unless the [covered entity] 
can demonstrate that making the modifications would fundamentally alter 
the nature of the [health] service, program, or activity'' and ``[a 
covered entity] is not required to provide a reasonable modification to 
an individual who meets the definition of `disability' solely under the 
`regarded as' prong of the definition of `disability' at Sec.  
35.108(a)(1)(iii).''
    The comment and our response regarding Sec.  92.205 are set forth 
below.
    Comment: One commenter urged OCR to strengthen the section by 
adding language to clarify that a modification to add something that is 
medically necessary for individuals with disabilities, or to eliminate 
exclusions related to medically necessary services, are not considered 
fundamental alterations to the nature of the health program.
    Response: OCR appreciates the commenter's request for clarifying 
language related to fundamental alterations. In promulgating this rule, 
OCR cannot address how the requirements of section 1557 apply to every 
scenario that may arise. OCR also

[[Page 37591]]

cannot state every modification that could result in a fundamental 
alteration because determining whether a modification is a fundamental 
alteration is a fact-specific process.
Summary of Regulatory Changes
    For the reasons set forth above and considering the comments 
received, we are finalizing the provisions as proposed in Sec.  92.205, 
without modification.
Equal Program Access on the Basis of Sex (Sec.  92.206)
    OCR proposed a section clarifying covered entities' obligation to 
ensure equal access to their health programs and activities without 
discrimination on the basis of sex.
    In proposed Sec.  92.206(a), we described a covered entity's 
general obligation to provide individuals equal access to the covered 
entity's health programs or activities without discrimination on the 
basis of sex.
    In proposed Sec.  92.206(b)(1) through (4), we clarified certain 
types of discriminatory actions that would be prohibited for a covered 
entity in its provision of access to health programs or activities.
    In Sec.  92.206(b)(1), we proposed prohibiting a covered entity 
from denying or limiting health services, including those that are 
offered exclusively to individuals of one sex, to an individual based 
on the individual's sex assigned at birth, gender identity, or gender 
otherwise recorded.
    In Sec.  92.206(b)(2), we proposed prohibiting covered entities 
from denying or limiting a health care professional's ability to 
provide health services on the basis of a patient's sex assigned at 
birth, gender identity, or gender otherwise recorded.
    In Sec.  92.206(b)(3), we proposed prohibiting a covered entity 
from applying any policy or practice of treating individuals 
differently or separating them on the basis of sex in a manner that 
subjects any individual to more than de minimis harm.
    In Sec.  92.206(b)(4), we proposed prohibiting a covered entity 
from denying or limiting health services sought for the purpose of 
gender-affirming care that the covered entity would provide to a person 
for other purposes if the denial or limitation is based on a patient's 
sex assigned at birth, gender identity, or gender otherwise recorded.
    In Sec.  92.206(c), we proposed that nothing in this section 
requires the provision of any health service where the covered entity 
has a legitimate, nondiscriminatory reason for denying or limiting that 
service, including where the covered entity reasonably determines that 
such health service is not clinically appropriate for that particular 
individual.
    In Sec.  92.206(d), we proposed that the enumeration of specific 
forms of discrimination in paragraph (b) does not limit the general 
applicability of the prohibition in paragraph (a).
    The comments and our responses regarding Sec.  92.206 are set forth 
below.
    Comment: Numerous commenters supported OCR's proposal to 
specifically address equal access on the basis of sex in the final 
rule. A supporter of the provision argued that patients who trust their 
provider not to discriminate against them will share better 
information, enabling better treatment. Some commenters specifically 
requested this section be strengthened by including specific examples 
of what constitutes discrimination based on sex characteristics.
    Response: OCR agrees that open communication between a provider and 
their patient is a bedrock of the provision of quality care, and that 
cannot happen where the patient experiences or expects that they will 
face discrimination by the provider. In addition, we note that the 
question of whether prohibited discrimination has occurred is often 
context specific and fact intensive, so it is difficult to provide 
succinct examples of scenarios that would constitute prohibited 
discrimination in each and every instance.
    Comment: Commenters urged OCR to include specific language related 
to reproductive health care and fertility treatments in Sec. Sec.  
92.206 and 92.207. A few commenters urged OCR to specify the full range 
of reproductive health care protected from discrimination under section 
1557, including protections against discrimination based on 
reproductive health decisions. A few commenters said the final rule 
should make clear that section 1557 prohibits discrimination related to 
maternity care, such as failing to provide accessible medical equipment 
or transfer assistance, leaving wheelchair users unable to access care. 
Another commenter opined that the final rule should make clear that 
section 1557 prohibits discrimination relating to treating pregnancy 
emergencies and complications, including termination of pregnancy, 
miscarriage management, and other pregnancy outcomes.
    Response: Matters related to reproductive health care, fertility, 
pregnancy, family status, and maternity care are addressed in Sec.  
92.208, and OCR refers commenters to that section. Covered entities 
must ensure accessibility of their health programs and activities for 
individuals with disabilities, which includes accessible equipment and 
transfer assistance.
    Comment: Some commenters argued that it would be more appropriate 
to address the impacts of the Dobbs decision and protections against 
discrimination on the basis of obtaining an abortion in Sec.  92.206 
rather than in Sec.  92.208 (Prohibition on sex discrimination related 
to marital, parental, or family status), because addressing abortion in 
the section on marital, parental, or family discrimination could convey 
that denying abortion care is only discriminatory in those contexts.
    Conversely, many commenters expressed opposition to the inclusion 
of termination of pregnancy within the scope of equal program access on 
the basis of sex, primarily stating that the rule would force health 
care professionals to perform abortions or deem their refusal to do so 
discrimination.
    Response: OCR appreciates commenters' feedback regarding the 
addition of pregnancy or related conditions in Sec.  92.206 rather than 
in Sec.  92.208. Based on a review of the totality of the comments, 
additional language has not been added to Sec.  92.206, and we discuss 
this issue further in Sec.  92.208. Further, the ACA itself provides 
that ``[n]othing in this Act shall be construed to have any effect on 
Federal laws regarding--(i) conscience protection; (ii) willingness or 
refusal to provide abortion; and (iii) discrimination on the basis of 
the willingness or refusal to provide, pay for, cover, or refer for 
abortion or to provide or participate in training to provide 
abortion.'' 42 U.S.C. 18023(c)(2)(A). OCR will comply with this 
provision. For further discussion regarding a health care 
professional's decision not to provide an abortion, including due to a 
sincerely held religious belief or conscience objection to performing 
the procedure, see Sec. Sec.  92.208 and 92.302.
    Comment: Many commenters recommended that in addition to the 
specific forms of discrimination based on gender identity, it is 
important to include specific forms of reproductive health and 
pregnancy-related care discrimination in Sec.  92.206(b). Many 
commenters recommended incorporating a provision or provisions under 
Sec.  92.206(b) to clarify that covered entities are prohibited from 
denying or limiting services--or denying or limiting a health 
professional's ability to provide services--based on a patient's

[[Page 37592]]

pregnancy or related conditions, including termination of pregnancy, 
contraceptive use, miscarriage management, assisted reproduction, 
fertility care, and pregnancy-related services. One of these commenters 
recommended that the language of this provision not be limited to 
reproductive or sexual ``health care decisions,'' as covered entities 
also discriminate based on reproductive and sexual health histories 
such as past experiences with sexual violence, which exist beyond the 
realm of services and that including ``care'' here could limit how 
covered entities understand this form of discrimination. Some 
commenters also stated that failure to codify some of the most 
prevalent forms of sex discrimination will directly undermine efforts 
to implement proposed Sec. Sec.  92.101 and 92.206.
    Response: OCR appreciates the recommendations regarding 
discrimination based on pregnancy or related conditions, including the 
request to provide additional examples, and directs commenters to the 
discussion at Sec.  92.208. The rule does not include language related 
to discrimination based on health care decisions. The rule is not so 
limited--it prohibits discrimination in health programs and activities 
generally. This includes discrimination on the basis of sex in the 
context of health decisions or histories related to reproductive and 
sexual health.
    Comment: Many commenters supported Sec.  92.206 as important to 
ensure access to necessary health services that might otherwise be 
denied to people due to discrimination on the basis of sexual 
orientation or gender identity, with many providing specific examples 
of discrimination faced by LGBTQI+ individuals. Some 
commenters recommended specifically addressing protections for 
LGBTQI+ people seeking fertility treatments. A commenter 
recommended that OCR consider adding a subsection to Sec.  92.206 or 
Sec.  92.208 to discuss the prohibition of discrimination on the basis 
of sexual orientation and gender identity in access to fertility 
services, and provided examples of the numerous barriers that 
LGBTQI+ individuals and same-sex couples face in accessing 
this type of reproductive health care.
    Response: Section 1557 and this rule prohibit discrimination on the 
basis of sex, including sex characteristics, sexual orientation, and 
gender identity, in health care access. Depending on the specific facts 
at issue, barriers described may rise to the level of discrimination 
and would be evaluated under this rule's general prohibition of 
discrimination under Sec.  92.101(a)(1), to make a case-by-case 
determination as to whether prohibited discrimination has occurred. In 
general, OCR anticipates that if a covered entity elects to provide or 
cover fertility services, but categorically denies them to same-sex 
couples or to individuals on the basis of sexual orientation or gender 
identity, such a denial of care or coverage may violate section 1557's 
prohibition on sex discrimination. We decline to add such specific 
language to the regulatory text as proposed.
    Comment: Commenters recommended that OCR should add language to 
Sec.  92.206(b) affirming that section 1557 prohibits covered entities 
from denying, limiting access to, or otherwise placing special caps, 
costs, or additional procedural requirements on medications or 
treatments needed specifically by people with disabilities, 
irrespective of whether those medications or treatments can also be 
used to end or complicate pregnancies or fertility.
    Response: We address special caps, costs, or additional procedural 
requirements related to health insurance coverage and other health-
related coverage in Sec.  92.207, and direct commenters to that 
section. A discussion of medications and treatments related to 
pregnancy and fertility care is in Sec.  92.208.
    Comment: Many commenters recommended including ``transgender 
status'' in Sec.  92.206(b)(1), (2), and (4) because there have been 
instances in which those seeking to permit discrimination against 
transgender people have justified it by pressing distinctions between 
transgender status and gender identity.
    Response: As noted in the discussion for Sec.  92.101(a)(2), the 
term ``gender identity'' necessarily encompasses transgender status and 
the two terms are often used interchangeably.\157\ We decline to 
enumerate the full range of identities protected under the term 
``gender identity.''
---------------------------------------------------------------------------

    \157\ See, e.g., Bostock v. Clayton Cnty., Georgia, 590 U.S. 
644, 658-59 (2020); Doe v. Mass. Dep't of Correction, No. CV 17-
12255-RGS, 2018 WL 2994403 (D. Mass. June 14, 2018); Whitaker v. 
Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034 (7th 
Cir. 2017).
---------------------------------------------------------------------------

    Comment: Multiple commenters expressed support for the rule's 
prohibition on denying or limiting care on the basis of a patient's 
assigned sex at birth, gender identity, or gender otherwise recorded at 
Sec.  92.206(b)(2). A commenter expressed support for the rule's 
prohibition on covered entities denying or limiting a clinician's 
ability to provide clinically appropriate care when the failure to do 
so would constitute discrimination.
    Another commenter supported this provision, arguing that it is 
necessary to ensure that specialists and providers who see LGBTQI+ 
patients every day do not experience retaliation for providing care. 
Pointing to State legislative efforts seeking to restrict or ban 
providers from offering safe and effective treatment to 
LGBTQI+ patients, the commenter argued that such protections 
are particularly important to alleviate providers' fears that they may 
be subject to retaliation or loss of licensure for providing gender-
affirming care. Another commenter similarly argued that covered 
entities sometimes discriminate against transgender patients by 
prohibiting their providers from providing certain services.
    Response: As noted in the Proposed Rule, 87 FR 47866, this 
provision recognizes that prohibited discrimination may take the form 
of restrictions on individual providers, such as attending physicians, 
that have the effect of discriminating against patients. Where a 
covered entity imposes such a restriction based on a patient's gender 
identity or sex assigned at birth, the restriction may constitute 
prohibited discrimination in violation of this rule, even if the form 
that the restriction takes is a limitation on the ability of providers 
to prescribe or provide care.
    Regarding providers' fears that they may be subject to retaliation 
by their employer or loss of licensure, this rule does not apply to 
employment practices, as discussed in Sec.  92.2(b), but employees of 
covered entities remain protected against retaliation as provided in 
Sec. Sec.  92.303 and 92.304. Not all State licensure boards receive 
Federal financial assistance from the Department; upon receipt of a 
complaint against a licensure board, OCR would need to first determine 
whether we have jurisdiction before commencing an investigation.
    Also, we note that a health care provider's decision not to provide 
any service due to a sincerely held religious belief or conscience 
objection is discussed further in Sec. Sec.  92.208 and 92.302.
    Comment: Many commenters suggested that Sec.  92.206(b)(2) would be 
clearer if the following phrase was deleted because it is redundant: 
``if such denial or limitation has the effect of excluding individuals 
from participation in, denying them the benefits of, or otherwise 
subjecting them to discrimination on the basis of sex under a covered 
health program or activity.''
    Response: OCR appreciates the suggestion and has considered it, but 
we

[[Page 37593]]

will maintain the proposed language, as the phrase provides additional 
explanation of what would constitute discrimination. As we noted in the 
Proposed Rule, 87 FR 47866, this is modeled on the provision in the 
title VI regulations that notes that certain discriminatory employment 
practices may be prohibited to the extent that they result in 
discrimination against program participants, even though the primary 
objective of title VI is not to regulate employment practices. See 45 
CFR 80.3(c)(3). Likewise, the phrase commenters propose deleting here 
clarifies that these restrictions on providers are prohibited only 
insofar as they result in discrimination against individuals on the 
basis of sex in a covered health program or activity. This phrase is 
necessary to establish a violation because a discriminatory act under 
this rule is one in which the individual is excluded from, denied the 
benefits of, or otherwise subjected to discrimination under a health 
program or activity on the basis of sex.
    Comment: A few commenters stated that it appears that Sec.  
92.206(b)(2) is directly aimed at the United States Conference of 
Catholic Bishops' Ethical and Religious Directives for Catholic Health 
Care Services.\158\ These commenters recommended that OCR disavow this 
provision and affirm support for the value of religiously affiliated 
health care and the right of faith-based hospitals to operate in 
accordance with their convictions.
---------------------------------------------------------------------------

    \158\ U.S. Conference of Catholic Bishops, Ethical and Religious 
Directives for Catholic Health Care Services (6th ed. 2018), https://www.usccb.org/resources/ethical-religious-directives-catholic-health-service-sixth-edition-2016-06_0.pdf.
---------------------------------------------------------------------------

    Response: As stated throughout this preamble, OCR values the vital 
role that faith-based hospitals and other health care providers and 
systems play in our nation's health care system. With respect to 
concerns about potential conflicts between provisions of the final rule 
and individuals' or organizations' sincerely held religious beliefs, we 
refer commenters to the discussion at Sec.  92.302. The aim of Sec.  
92.206(b)(2) is to address discrimination that has a secondary effect 
on the ability of individuals to participate meaningfully in and/or to 
receive health care from a covered health program in a 
nondiscriminatory manner. OCR did not, nor did it intend to, single out 
any religious teachings and will respect all guarantees of Federal 
religious freedom and conscience laws.
    Comment: Commenters highlighted that transgender and nonbinary 
people face unique discrimination in inpatient settings that are 
separated by sex, particularly those that have only male and female 
facilities available. These commenters noted that this results in 
nonbinary people not having access to facilities consistent with their 
gender identity.
    A few commenters raised concerns about the application of Sec.  
92.206(b)(3) to arrangements and practices involving patients who share 
intimate space with, or require intimate personal assistance from, 
other individuals. The commenters argued that the requirement to treat 
individuals consistent with their gender identity may raise concerns 
for privacy.
    Response: OCR appreciates the commenters' feedback. As specified in 
the preamble discussion for Sec.  92.101, this final rule protects all 
people regardless of gender identity, including transgender and 
nonbinary people. Nothing in this rule prohibits a covered entity from 
operating sex separated programs and facilities, so long as it does not 
subject anyone, including transgender and nonbinary individuals, to 
more than de minimis harm on the basis of sex. When a nonbinary 
individual seeks participation in a single-sex health program or 
activity or a health program or activity that maintains sex separate 
facilities, the covered entity should work with that individual to 
determine where they will best be served and where they can benefit the 
most from the health program or activity without experiencing trauma, 
distress, or threats to their safety due to an incorrect placement. A 
covered entity must not deny a nonbinary individual access to a health 
program or facility on the basis that the program or facility separates 
patients based on sex or offers separate male and female programs or 
facilities.
    Courts have held that all individuals' safety and privacy can be 
protected without also excluding transgender individuals from accessing 
sex-separate facilities and activities consistent with their gender 
identity.\159\ Nothing in the rule prevents covered entities from 
implementing policies or procedures to preserve any patient's privacy--
consistent with the requirements of this rule and any other applicable 
laws. Providers have a range of tools at their disposal to accommodate 
individuals' privacy concerns and patient interests in a 
nondiscriminatory manner. For example, a provider generally may 
accommodate a patient's preferences about roommate assignments. A 
covered entity will be in violation of this rule if they refuse to 
admit a transgender person for care or refuse to place them in 
facilities consistent with their gender identity, because doing so 
would result in more than de minimis harm. We also note that no 
application of this rule shall be required insofar as it would violate 
Federal religious freedom and conscience laws. Recipients may rely on 
those protections directly, see Sec.  92.3(c), or they may seek an 
assurance of a religious freedom or conscience exemption, see Sec.  
92.302(b).
---------------------------------------------------------------------------

    \159\ Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 613-15 
(4th Cir. 2020); see also Cruzan v. Special Sch. Dist. # 1, 294 F.3d 
981, 984 (8th Cir. 2002) (per curiam) (holding that transgender 
woman's mere presence in a sex-separate space did not constitute 
actionable sexual harassment of her female co-workers); Whitaker v. 
Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, 1052-
53 (7th Cir. 2017).
---------------------------------------------------------------------------

    Comment: A commenter opposed the rule on the grounds that it would 
violate the U.S. Constitution's Equal Protection Clause standard for 
sex discrimination claims, which the commenter asserted allows men and 
women to be treated differently based on inherent differences in 
biology when such differences are real and not based on stereotypes. 
The commenter argued that proposed Sec.  92.206(b)(3) would 
inappropriately prohibit providers from using any sex-based distinction 
unless they can prove it does not cause more than de minimis harm. This 
commenter alleged that the true purpose of such a provision is not 
equal treatment for all patients but special treatment for transgender 
individuals, particularly with respect to the use of sex-separate 
facilities. This commenter also argued that the provision would 
contradict the Voluntary Resolution Agreement the Department entered 
into with Michigan State University (MSU) under section 1557, which 
requires the presence of a chaperone--the sex of whom should be 
determined by the wishes and comfort of the patient--for all sensitive 
examinations.\160\
---------------------------------------------------------------------------

    \160\ See Voluntary Resolution Agreement between U.S. Dep't of 
Health & Hum. Servs., Off. for Civil Rights & The Bd. of Trs. of 
Mich. State Univ., dba Mich. State Univ. & MSU HealthTeam & MSU 
Health Care, Inc. (2019), https://www.hhs.gov/sites/default/files/vra-between-msu-and-ocr.pdf.
---------------------------------------------------------------------------

    Response: Not all differential treatment on the basis of sex 
constitutes unlawful discrimination under section 1557, and the final 
rule does not prohibit all differential treatment.\161\ If a

[[Page 37594]]

sex-based distinction has only a de minimis impact, it is not 
prohibited discrimination.\162\ But treating individuals differently on 
the basis of sex constitutes sex discrimination where it imposes a 
more-than-de minimis level of harm. Under the rule, providers may use 
sex-based distinctions to administer individualized care, provided 
those distinctions do not cause more than de minimis harm.
---------------------------------------------------------------------------

    \161\ Several courts have held that discrimination against 
transgender people constitutes sex discrimination under the Equal 
Protection Clause. See, e.g., Hecox v. Little, Nos. 20-35813, 20-
35815, 2023 WL 5283127, at *12 (9th Cir. Aug. 17, 2023); Brandt v. 
Rutledge, 551 F. Supp. 3d 882, 889 (E.D. Ark. 2021), aff'd sub nom. 
Brandt ex rel. Brandt v. Rutledge, 47 F.4th 661, 670 (8th Cir. 
2022); Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 586, 608 (4th 
Cir. 2020); Whitaker by Whitaker v. Kenosha Unified Sch. Dist. No. 1 
Bd. of Educ., 858 F.3d 1034, 1048 (7th Cir. 2017), abrogated on 
other grounds as recognized by Ill. Republican Party v. Pritzker, 
973 F.3d 760, 762 (7th Cir. 2020); Glenn v. Brumby, 663 F.3d 1312, 
1316 (11th Cir. 2011); Smith v. City of Salem, 378 F.3d 566, 572, 
577 (6th Cir. 2004); but see L. W. by & through Williams v. 
Skrmetti, 83 F.4th 460 (6th Cir. 2023).
    \162\ See, e.g., Oncale v. Sundowner Offshore Servs., Inc., 523 
U.S. 75, 81 (1998) (title VII does not reach non-harmful 
``differences in the ways men and women routinely interact with'' 
each other); see also Burlington N. & Santa Fe Ry. Co. v. White, 548 
U.S. 53, 59-60 (2006) (``No one doubts that the term `discriminate 
against' refers to distinctions or differences in treatment that 
injure protected individuals.'').
---------------------------------------------------------------------------

    We disagree with the proposition that purpose of Sec.  92.206(b)(3) 
is special treatment for transgender individuals, particularly with 
respect to the use of sex-specific facilities. The purpose of this 
section is to prevent unlawful discrimination on the basis of sex. The 
prevention of discrimination on the basis of gender identity is an 
important government objective that is substantially achieved by this 
rule.
    Further, the Voluntary Resolution Agreement entered into with MSU, 
provides that a patient may request a chaperone to be present at any 
time and that the patient's ``wishes and comfort should determine the 
sex of the chaperone.'' \163\ It further specifies that MSU ``shall 
accommodate, to the extent practicable, the Patient's request for a 
same-sex chaperone.'' \164\ The final rule does not prohibit patients 
from requesting or receiving a chaperone of the sex of their choosing.
---------------------------------------------------------------------------

    \163\ MSU Agreement at IV.D.1.v.
    \164\ MSU Agreement at IV.D.1.vi.
---------------------------------------------------------------------------

    Finally, OCR disagrees with the commenter that the rule violates 
the Equal Protection Clause. OCR's authority to promulgate this rule 
stems from a Federal non-discrimination statute, section 1557. This 
rule does not purport to interpret the Equal Protection Clause. Thus, 
even assuming the commenter is correct that the rule bans certain sex-
based distinctions that would be permitted under the Equal Protection 
Clause, such a discrepancy would not mean the rule is unlawful. OCR may 
promulgate a rule that imposes different non-discrimination 
requirements on recipients of Federal funds than the non-discrimination 
requirements the Equal Protection Clause imposes on the 
government.\165\
---------------------------------------------------------------------------

    \165\ Cf. Fitzgerald v. Barnstable Sch. Comm., 555 U.S. 246, 257 
(2009) (recognizing that the liability standards under title IX and 
the Equal Protection Clause ``may not be wholly congruent'').
---------------------------------------------------------------------------

    Comment: A health research organization expressed support regarding 
Sec.  92.206(b)(3)'s discussion of the impact on health research and 
clinical trials. The commenter commended OCR on its guidance on sex-
specific health research. This commenter stated that the standard for 
limiting research outlined by OCR in the 2022 NPRM was reasonable and 
health researchers will typically be able to demonstrate the requisite 
justification for a sex-specific research project or clinical trial 
based on research protocols. However, the commenter requested OCR 
provide similar guidance for the final rule on whether health research 
protocols that target or exclude individuals with disabilities would be 
considered discriminatory.
    Conversely, another organizational commenter disagreed with the 
statement on sex-specific clinical trials because the commenter 
believed it would pressure clinical researchers and organizations to 
disregard sex-based distinctions for fear of inviting a gender identity 
discrimination claim. The commenter claimed that the rule would 
contradict National Institutes of Health (NIH)'s expectation for 
clinical trials, which the commenter claimed required specifying the 
``biological sex'' of subjects, by laying down an ``unscientific 
marker'' that sex-specific clinical trials can only be justified in 
limited circumstances.\166\ The commenter further argued that this 
would represent a backward step for women's health, because the 
evaluation of diseases and treatments improved when researchers 
recognized that sex must be taken into account as a biological variable 
in medicine.
---------------------------------------------------------------------------

    \166\ The commenter does not provide a citation when making this 
statement; however earlier in their comment, the commenter cites a 
Notice from the National Institutes of Health (NIH): U.S. Dep't of 
Health & Hum. Servs., Nat'l Inst. of Health, Consideration of Sex as 
a Biological Variable in NIH-funded Research, NOT-OD-15-102 (June 9, 
2015), https://grants.nih.gov/grants/guide/notice-files/not-od-15-102.html.
---------------------------------------------------------------------------

    Response: OCR appreciates these comments regarding the application 
of this provision to sex-specific health research and clinical trials 
and the standard proposed for evaluating claims of discrimination in 
such health programs and activities. We agree that researchers should 
not have challenges showing necessary justifications for 
nondiscriminatory research distinctions grounded in a participant's 
reproductive, anatomical, and genetic characteristics.
    We disagree with the proposition that OCR is disregarding sex-based 
distinctions in medicine. Health research and clinical trial protocols 
are not prohibited from specifying an individual's sex consistent with 
their reproductive, anatomical, and genetic characteristics, where 
those characteristics are relevant to the clinical trial. However, 
there are ways in which health research and protocols may result in 
discrimination, such as disallowing participation based on gender 
identity rather than on the basis of scientific requirement of the 
research.
    Should the need arise, OCR will consider issuing guidance on the 
impacts of disability protections on research participation.
    Comment: Several commenters supported the rule's prohibition on 
sex-specific health programs or activities that subject any individual 
to more than de minimis harm. One supportive commenter argued that this 
approach recognizes harm as the primary measure of discrimination and 
creates flexibility to identify new forms of harm, and another argued 
the standard of no more than de minimis harm is consistent with 
applicable case law, including Bostock. A commenter expressed 
appreciation for the Proposed Rule's detailed explanation of de minimis 
harm and the difference between clinical care for a patient.
    Conversely, another commenter stated the Proposed Rule ``cherry 
picks'' a title IX court decision to justify a standard of ``more than 
de minimis harm'' as the basis for ``adjudicating gender identity,'' 
arguing that title IX has never required sex to be recognized as 
anything but ``objectively, biologically based.'' Similarly, another 
commenter argued the rule applies beyond denial or limitations on 
health services. The commenter argued that the rule would prohibit 
health care professionals, medical facilities, and insurance companies 
from using any sex-based distinction unless they can prove it does not 
cause more than de minimis harm, and that if a provider asks the wrong 
question or asks an appropriate question in the wrong manner then the 
provider will likely face a claim of discrimination on the basis of 
gender identity.
    Response: OCR appreciates the range of comments provided on the 
proposed language regarding de minimis harm, and after careful review, 
OCR is finalizing the language as proposed. The rule does not prohibit 
all sex-based distinctions in health programs or activities, nor does 
it broadly prohibit any policy or practice of treating

[[Page 37595]]

individuals differently based on sex. As noted in the Proposed Rule, 
although intentional differential treatment on the basis of sex would 
generally be considered prohibited discrimination, separation by sex or 
differential treatment on the basis of sex is permissible under section 
1557 where it does not cause more than de minimis harm. 87 FR 47866. 
This distinction generally allows for sex-specific clinical trials when 
sex is relevant to the trial, for example, while still prohibiting 
differential treatment that causes harm.
    Providers often need to make inquiries about a patient's sex-
related medical history, health status, or physical traits related to 
sex in the course of providing care and this rule does not prohibit or 
inhibit that. 87 FR 47867-68. Such inquiries are not per se 
discriminatory, even where they touch on intimate or sensitive matters. 
For example, it is not discriminatory for a provider treating a patient 
presenting with symptoms consistent with an ectopic pregnancy to 
inquire about the possibility that the patient could be pregnant, 
regardless of that patient's gender identity. Similarly, when providing 
appropriate care to a patient, asking medically relevant questions 
about a patient's anatomy or medical history in a way that causes 
inadvertent distress--on its own--would not violate section 1557. 
However, it is important to note that if such questions are not 
relevant to assessing the patient's condition, or the patient has 
answered the questions and makes clear that further questions are 
unwelcome, the inquiries may rise to the level of harassment on the 
basis of sex. For example, if the conduct is so severe or pervasive 
that it denies a patient access to medical care, it would no longer be 
permissible. OCR will evaluate these types of harassment claims on a 
case-by-case basis to determine whether the alleged harassment was 
``sufficiently severe, pervasive, and objectively offensive,'' to meet 
the standards for discriminatory harassment.\167\
---------------------------------------------------------------------------

    \167\ Cf. Davis by Next Friend LaShonda D. v. Monroe Cnty. Bd. 
of Educ., 526 U.S. 629, 650 (1999) (Under title IX, discriminatory 
harassment must be ``severe, pervasive, and objectively 
offensive'').
---------------------------------------------------------------------------

    In response to commenters that questioned the legal basis for our 
de minimis standard, we discussed in the 2022 NPRM, 87 FR 47866, n. 
412, that sex-based distinctions that have only de minimis impact are 
not the type of discrimination that Congress envisioned.\168\
---------------------------------------------------------------------------

    \168\ See also Elborough v. Evansville Cmty. Sch. Dist., 636 F. 
Supp. 2d 812, 820-21 (W.D. Wis. 2009) (noting that Title IX does not 
``authorize[ ]lawsuits for damages in all cases of differential 
treatment, no matter how isolated or minimal. The maxim that `the 
law doesn't concern itself with trifles' applies to civil rights 
cases as it does to any other case.'').
---------------------------------------------------------------------------

    Comment: A commenter recommended that, based on existing racial 
disparities in maternal health and overall poor maternal health 
outcomes in the United States, Sec.  92.206(b)(3) be amended to specify 
that harm exceeding the threshold of de minimis harm with respect to 
pregnancy and maternal health can include policies or practices that 
subject people to rough handling, harsh language, undertreatment of 
pain or pregnancy-related conditions, or other discriminatory 
mistreatment during childbirth or the prenatal or postpartum periods.
    Response: OCR recognizes that there is ample research demonstrating 
the significant racial disparities in maternal health outcomes.\169\ 
Section 92.206(b)(3) specifically addresses different treatment on the 
basis of sex, such as through sex-separate health programs and 
activities. Depending on the specific facts at issue, the treatment 
described by the commenter may rise to the level of discrimination and 
would be evaluated under this rule's general prohibition of 
discrimination under Sec.  92.101.
---------------------------------------------------------------------------

    \169\ Donna L. Hoyert, U.S. Dep't of Health & Hum. Servs., Ctrs. 
for Disease Control & Prevention, Maternal Mortality Rates in the 
United States (Feb. 2022), https://www.cdc.gov/nchs/data/hestat/maternal-mortality/2020/E-stat-Maternal-Mortality-Rates-2022.pdf; 
Marian F. MacDorman et al., Racial and Ethnic Disparities in 
Maternal Mortality in the United States Using Enhanced Vital 
Records, 2016-2017, 111 a.m. J. Pub. Health 1673, 1671 (2021), 
https://ajph.aphapublications.org/doi/10.2105/AJPH.2021.306375.
---------------------------------------------------------------------------

    Comment: An organizational commenter strongly supported the 
additional guidance provided by proposed Sec. Sec.  92.206 and 92.207 
and noted that the forms of discrimination highlighted in proposed 
Sec. Sec.  92.206(b)(3) and (4) and 92.207(b)(3) through (5), in 
particular, affect many intersex people.
    Response: OCR appreciates the commenter's feedback regarding the 
discrimination addressed in Sec. Sec.  92.206(b)(3) and (4) and 
92.207(b)(3) through (5) affecting intersex people as well. This final 
rule makes explicit in regulatory text that sex discrimination includes 
discrimination based on sex characteristics, including intersex traits, 
as reflected in Sec.  92.101(a)(2).
    Comment: Many commenters expressed support for the proposed 
provisions related to gender-affirming care at Sec.  92.206(b)(4). 
These commenters stated that such care can be critical to the well-
being of transgender and nonbinary people, and that accessing such care 
can reduce the risk of negative physical and mental health outcomes 
associated with gender dysphoria. Commenters discussed the negative 
impact of widespread health care discrimination against transgender 
people, stating that transgender people of color and transgender people 
with disabilities are at particularly high risk of discrimination and 
associated harms.
    Response: OCR appreciates these comments and agrees that the 
nondiscrimination protections are important to transgender and 
nonbinary people's ability to access clinically appropriate care, 
especially those who may face elevated risk of harm due to 
discrimination on multiple protected bases.
    In determining whether a covered entity violated section 1557 by 
denying or limiting a health service sought for the purpose of gender-
affirming care, OCR will continue to consider evidence that the covered 
entity would provide that same service for other purposes. Evidence 
that OCR may consider to establish that the type of care is ordinarily 
provided could include, among other things, statements by the provider, 
information showing that the provider has provided similar care in the 
past, or documentation regarding the provider's scope of practice.
    Where there is other evidence that the covered entity has subjected 
the individual to differential treatment on the basis of sex apart from 
the denial of care itself, OCR may investigate and make a case-by-case 
determination as to whether prohibited discrimination has occurred.
    Comment: A few commenters stated that OCR is explicitly asserting 
that it has authority under section 1557 to regulate the practice of 
medicine according to its own determination of what is appropriate and 
non-discriminatory care, along with authority to definitively determine 
what is the current standard of medical care. Some commenters requested 
OCR amend the provision to specify that care standards cannot facially 
discriminate or otherwise result in discrimination based on a protected 
characteristic, such that covered entities cannot mask discrimination 
behind clinical policies or criteria.
    Response: Section 1557 prohibits discrimination on certain 
prohibited bases, and does not (and cannot) require a specific standard 
of care or course of treatment for any individual or otherwise 
interfere with individualized clinical judgment about the appropriate 
course of care for a patient. OCR has a general practice of deferring 
to a clinician's judgment about whether a particular service is 
medically appropriate for an individual, or

[[Page 37596]]

whether the clinician has the appropriate expertise to provide care. 
There is no part of section 1557 that compels clinicians to provide a 
service that they do not believe is medically appropriate for a patient 
or that they are not qualified to provide.
    Section 92.206(c) is consistent with the general principle in 
nondiscrimination law that entities facing allegations of 
discrimination have the opportunity to articulate a legitimate, 
nondiscriminatory basis for their challenged action or practice but 
that such a basis may not be a pretext for discrimination.
    Comment: Some commenters expressed concern that OCR is setting 
standards of care for gender-affirming care in this rule, and that is 
outside the scope of OCR's authority. Many commenters weighed in with 
their views on the state of medical evidence relating to gender-
affirming care and submitted citations to research studies and other 
data. Some comments characterized the evidence as lacking or mixed, and 
highlighted their concerns relating to gender-affirming care for 
minors. Others stated that there is robust evidence, including from 
major medical associations, supporting the provision of gender-
affirming care, including that such medically necessary care benefits 
the health and well-being of transgender patients.
    Response: This final rule prohibits discrimination on the basis of 
sex, consistent with Federal law. As such, nothing in this rule impedes 
covered entities from taking nondiscriminatory actions based on current 
medical standards and evidence, such as making decisions about the 
timing or type of protocols appropriate for care. The rule does not 
(and cannot) require a specific standard of care or course of treatment 
for any individual, minor or adult. Section 1557 prohibits 
discrimination on certain prohibited bases, and does not interfere with 
individualized clinical judgment about the appropriate course of care 
for a patient. OCR has a general practice of deferring to a clinician's 
judgment about whether a particular service is medically appropriate 
for an individual, or whether the clinician has the appropriate 
expertise to provide care.
    Comment: A number of commenters had concerns or questions about the 
scope of how OCR would define gender-affirming care. Some commenters 
requested a definition or an enumeration of what types of procedures 
would fall within this term. Others raised concerns about the impact of 
such care and the benefits of such care.
    Response: As with the 2016 Rule, 81 FR 31435, OCR declines to 
provide a regulatory definition for gender-affirming care. However, 
when we used the term ``gender-affirming care'' in both Sec. Sec.  
92.206 and 92.207, we are generally referring to care designed to treat 
gender dysphoria that may include, but is not necessarily limited to, 
counseling, hormone therapy, surgery, and other related services. 87 FR 
47834 n.139. As noted elsewhere, the rule does not impose a categorical 
requirement that covered entities must provide gender-affirming care. 
Further, while we acknowledge comments in support of and opposed to 
gender affirming care and its subsequent impacts on individuals, we are 
not making any additional edits to the rule in response.
    Comment: Some commenters opposing the rule raised First Amendment 
concerns and questioned the scope of what would be required of 
providers in terms of expressing support of transgender people who wish 
to access gender-affirming care, using the name and pronouns requested 
by patients, and speaking about gender-affirming care.
    Response: OCR takes seriously concerns about, and is fully 
committed to upholding, the First Amendment, and nothing in these 
regulations restricts conduct protected by the First Amendment.\170\ 
Whether discrimination is unlawful or considered harassment is 
necessarily fact-specific. This final rule does not purport to identify 
all of the circumstances that could constitute unlawful harassment. It 
is unlikely that an isolated incident with no other indications of 
animus or ill treatment would meet the standards for discriminatory 
harassment. Conversely, OCR notes that conduct, including verbal 
harassment, that is so severe or pervasive that it creates a hostile 
environment on the basis of sex is a form of sex discrimination.
---------------------------------------------------------------------------

    \170\ See, e.g., W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 
624, 642 (1943) (``We think the action of the local authorities in 
compelling the flag salute and pledge transcends constitutional 
limitations on their power and invades the sphere of intellect and 
spirit which it is the purpose of the First Amendment to our 
Constitution to reserve from all official control.'').
---------------------------------------------------------------------------

    Comment: A few commenters argued that providing gender-affirming 
care poses high malpractice lawsuit risks to providers, and therefore 
OCR should not categorically require providers to provide such 
services.
    Response: As discussed elsewhere in this preamble, this final rule 
prohibits discrimination in the provision of health programs and 
activities and does not require provision of any specific services, 
including gender-affirming care. Section 1557 prohibits discrimination 
on certain prohibited bases, and does not interfere with individualized 
clinical judgment about the appropriate course of care for a patient. 
OCR has a general practice of deferring to a clinician's judgment about 
whether a particular service is medically appropriate for an 
individual, or whether the clinician has the appropriate expertise to 
provide care.
    Comment: One commenter expressed concern that the rule would result 
in decreased access to health care, as providers may choose to leave 
Federal health care programs based on a belief that they will be 
required to provide gender-affirming care, especially if there is no 
avenue for providers with religious or conscience objections to certain 
types of care to request exemptions.
    Response: Section 1557 requires that health care providers who 
receive Federal financial assistance must provide nondiscriminatory 
care. However, providers do not have an affirmative obligation to offer 
any health care, including gender-affirming care, that they do not 
think is clinically appropriate or if religious freedom and conscience 
protections apply. OCR believes that the majority of providers already 
provide nondiscriminatory care to their patients and will continue to 
do so. This commenter presented no evidence that a significant exodus 
of providers is likely, and we are not aware of any data to support a 
significant concern on this front. Providers with religious freedom or 
conscience concerns, however, may rely upon Sec. Sec.  92.3 and 92.302.
    Comment: A few commenters expressed support for nondiscrimination 
protections that prohibited discriminating against an individual 
because of their gender identity but opposed interpreting such 
protections to protect access to gender-affirming care.
    Response: OCR appreciates these commenters' support for the rule's 
nondiscrimination protections on the basis of gender identity. We 
respectfully disagree, however, that such protections have no 
implications for the provision of gender-affirming care. A fact-
specific analysis is necessary to determine whether prohibited 
discrimination has occurred, but the rejection of a practice closely 
linked with a protected status may, in conjunction with other evidence, 
lead to a finding of discrimination. This rule does not require or 
mandate the provision of any particular medical service. Section 1557 
prohibits discrimination on certain prohibited bases, and does not 
interfere

[[Page 37597]]

with individualized clinical judgment about the appropriate course of 
care for a patient. OCR has a general practice of deferring to a 
clinician's judgment about whether a particular service is medically 
appropriate for an individual, or whether the clinician has the 
appropriate expertise to provide care.
    Comment: An organizational commenter supported reference to the 
multi-factor test found in Arlington Heights v. Metro. Housing Dev. 
Corp., 429 U.S. 252 (1977), and the burden-shifting framework of 
McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), among a non-
exhaustive list of tools that OCR may utilize for investigating 
discrimination claims. The commenter asserted that sex discrimination 
claims are hard to prove, and that together these approaches are 
appropriate for their adjudication by allowing people to rely on 
different types of circumstantial evidence to collectively demonstrate 
a discriminatory act by a covered entity and by placing the onus on the 
covered entity to provide a legitimate, nondiscriminatory reason for 
its actions. Similarly, another commenter encouraged OCR to clearly 
state in the final rule that the familiar but-for causation test 
applies to establishing a violation of section 1557; that the use of 
the phrase ``legitimate, nondiscriminatory reason'' in these sections 
should not be construed in any way to limit the method of proof for any 
section 1557 claim to the McDonnell Douglas burden-shifting framework; 
and that this method cannot be used to defend an express sex-based 
classification that causes injury. Another commenter recommended that 
OCR clarify in the preamble to the final rule that the McDonnell 
Douglas burden-shifting framework and legitimate non-discriminatory 
reason framework apply to circumstantial evidence cases but not where 
there is direct evidence of discrimination.
    Response: OCR agrees that different methods of proof drawn from 
civil rights case law should be used in analyzing claims of 
discrimination under this section including, but not limited to, the 
Arlington Heights multi-factor test and the McDonnell Douglas burden-
shifting framework. For cases where the alleged discrimination is not 
based on a facially discriminatory policy, we are clarifying that the 
phrase ``legitimate, nondiscriminatory reason'' in these sections is 
taken from, but should not be construed to limit, the method of proof 
to the McDonnell Douglas burden-shifting framework. As we noted in the 
Proposed Rule, Arlington Heights provides a method of proof that uses a 
number of different types of evidence--e.g., direct, circumstantial, 
statistical, and anecdotal--that, taken collectively, can demonstrate 
that the covered entity acted because of a protected basis; the 
McDonnell Douglas burden-shifting framework is an inferential method of 
proof most commonly applied in cases alleging discrimination in 
individual instances where a plaintiff alleges that a defendant treated 
similarly situated individuals differently because of a protected 
basis. 87 FR 47865. Under the Arlington Heights framework, McDonnell 
Douglas evidence identifying similarly situated comparators can also be 
considered but is not required.\171\
---------------------------------------------------------------------------

    \171\ Pac. Shores Props., LLC v. Newport Beach, 730 F.3d 1142, 
1158-59 (9th Cir. 2013) (noting that a plaintiff need not rely on 
the McDonnell-Douglas approach to intentional discrimination but may 
instead produce other circumstantial evidence of intentional 
discrimination using Arlington Heights, as McDonnell Douglas ``is 
not a straightjacket requiring the plaintiff to demonstrate that 
such similarly situated entities exist'').
---------------------------------------------------------------------------

    Comment: Many commenters supported the rule's clarification that 
while providers may exercise clinical judgment when determining if a 
particular service is appropriate for an individual patient, they may 
not refuse gender-affirming care based on a belief that such care is 
never clinically appropriate. A great number of individuals and 
organizations provided comment on the types of rationales that might 
constitute a legitimate, nondiscriminatory basis for a provider 
declining to provide gender-affirming care. Some commenters opined that 
it should not be considered discriminatory to deny care when a provider 
categorically objects to gender-affirming care. Other commenters 
appreciated the clarification that a provider's personal belief that 
gender-affirming care is never appropriate is not a legitimate, 
nondiscriminatory basis for denying such care. The majority of 
commenters opined that the rule provides adequate protection for 
providers exercising nondiscriminatory clinical judgment about the 
appropriateness of particular care for a specific patient, though some 
commenters disagreed.
    Response: OCR appreciates commenters' views on proposed Sec.  
92.206(c). In light of comments received, we are modifying the language 
in this provision to provide additional specificity regarding how OCR 
will evaluate a covered entity's proffered legitimate, 
nondiscriminatory reason for denying care. We also add a reference to 
Sec.  92.302 to make clear that this provision does not limit a 
recipient's ability to seek assurance of an exemption based on 
religious freedom or conscience laws. Also, we note that while many 
commenters specifically discuss providers' personal beliefs, these 
changes clarify that the rule applies to covered entities rather than 
specific individuals.
    To provide additional specificity, we are striking the second 
sentence of Sec.  92.206(c), which previously read, ``[h]owever, a 
provider's belief that gender transition or other gender-affirming care 
can never be beneficial for such individuals (or its compliance with a 
State or local law that reflects a similar judgment) is not a 
sufficient basis for a judgment that a health service is not clinically 
appropriate,'' in its entirety and replacing it with: ``A covered 
entity's determination must not be based on unlawful animus or bias, or 
constitute a pretext for discrimination. Nothing in this section is 
intended to preclude a covered entity from availing itself of 
protections described in Sec. Sec.  92.3 and 92.302.'' Our reasons for 
this change are as follows:
    First, many commenters strongly urged OCR to consider that 
providers may have a nondiscriminatory reason to not provide some 
aspects of or all gender-affirming care. OCR understands that a 
provider may have a legitimate nondiscriminatory reason not to provide 
a health service, which the newly revised Sec.  92.206(c) makes clear. 
While this section has application in the gender-affirming care 
context, the revised language is also intended to make clear that it is 
not limited to that context. When OCR investigates claims of 
discrimination based on the denial of care, OCR will consider the 
covered entity's rationale for such denial, any supporting information 
the covered entity offers for its position, and any evidence of 
unlawful animus, bias, or other discriminatory factors in the case.
    Second, and as discussed, section 1557 prohibits discrimination on 
certain prohibited bases, and does not interfere with individualized 
clinical judgment about the appropriate course of care for a patient. 
OCR has a general practice of deferring to a clinician's judgment about 
whether a particular service is medically appropriate for an 
individual, or whether the clinician has the appropriate expertise to 
provide care. There is no part of section 1557 that compels clinicians 
to provide a service that they do not believe is medically appropriate 
for a particular patient or that they are not qualified to provide.
    Since the rule does not (and cannot) set a standard of care for 
gender-affirming care, the focus of any investigation will not be to 
generally

[[Page 37598]]

review a covered entity's clinical judgment but rather to determine 
whether the assertion of that judgment reflects unlawful animus or 
bias, or is a pretext for discrimination. Similarly, outside of the 
gender-affirming care context, OCR may find an invocation of clinical 
appropriateness to be pretextual if, for example, the evidence 
demonstrates that the covered entity asserted that pain medication was 
not clinically appropriate for a patient because of the belief that 
women exaggerate pain symptoms and inaccurately relay information about 
their symptoms.
    Third, because many commenters expressed concern about the 
relationship between Sec.  92.206(c) and religious or moral beliefs 
concerning gender-affirming care, we added an explicit reference in 
Sec.  92.206(c) to Sec.  92.302. The new language clarifies that Sec.  
92.206(c) does not preclude the process set forth in Sec.  92.302 where 
a recipient's objection to gender-affirming care may be protected under 
religious freedom and conscience laws.
    Comment: Many commenters also cited religious or moral objections 
to gender-affirming care, urging that these should be considered a 
legitimate, nondiscriminatory reason to decline to provide such care.
    Response: OCR understands that recipients may have religious or 
conscience objections to the provision of certain types of care. Such 
an objection can serve as a legitimate, nondiscriminatory reason where 
it is neither pretextual nor discriminatory. If a provider typically 
declines to provide a particular health service to any individual based 
on a religious belief, regardless of individual's sex assigned at birth 
or gender identity, the provider likely meets Sec.  92.206(c)'s 
standard for a ``legitimate, nondiscriminatory reason.'' And where a 
provider's religious belief causes the provider to treat individuals 
differently based on sex assigned at birth or gender identity, the 
provider may rely on the protections afforded by religious freedom and 
conscience laws or choose to seek assurance of those protections by 
making use of Sec.  92.302(b)'s assurance of religious freedom and 
conscience exemption process, a feature that both the 2016 and 2020 
Rules lacked. As discussed in more detail below, OCR is making several 
modifications to Sec.  92.302 to strengthen and clarify this process.
    Comment: Many commenters supported the inclusion of Sec.  92.206(c) 
but recommended that OCR strengthen the language pertaining to 
providers complying with a State or local law as a justification for 
denying gender-affirming care, abortions, or other reproductive health 
care to clarify that as a Federal civil rights law, the rule preempts 
any such State or local law restricting access to such care. Some 
commenters suggested including language in the preamble to make clear 
that the majority of States' policies that restrict transgender and 
nonbinary people's access to health care would be barred. Another 
commenter expressed support for explicit preemption language, because 
otherwise providers would be forced to attempt to comply with State and 
local laws, while also trying not to run afoul of OCR's case-by-case 
judgment concerning what conduct may be considered discriminatory. Some 
commenters expressed concern that the rule could deem physicians' 
conduct discriminatory when declining to provide services because of 
State or local laws restricting those services, leaving them in an 
untenable position. Other commenters criticized the rule because they 
believe it preempts State laws restricting abortion and gender-
affirming care and seeks to preempt State laws on religious freedom and 
conscience. A commenter expressed confusion as to how the rule would 
preempt State law as opposed to simply disallowing Federal funds from 
entities that do not comply.
    Response: OCR understands providers' concerns that the provision's 
reference regarding compliance with State or local law would place them 
in a difficult position with regard to the conflicting demands of this 
rule's nondiscrimination requirements and various State and local laws 
restricting access to abortion or gender-affirming care. While we have 
removed the language from Sec.  92.206(c) that many commenters 
supported, section 1557's nondiscrimination requirements nevertheless 
generally preempt conflicting State law for the reasons stated earlier 
in this preamble. That said, in exercising and determining its 
enforcement priorities, OCR will consider the specific factual record 
of each complaint on a case-by-case basis. This may include, among 
other things, consideration of whether any covered entity that is 
taking discriminatory actions under the rule is doing so because it 
believes in good faith it is obligated to do so by State or local law, 
whether that covered entity demonstrated a willingness to refer or 
provide accurate information about gender-affirming care, or is 
otherwise engaging in good faith efforts to ensure patients are 
receiving medically necessary care.
    Comment: Several commenters expressed support for Sec.  92.206(d)'s 
clarification that the enumeration of specific forms of prohibited 
discrimination in Sec.  92.206(b) does not limit the general 
prohibition against discrimination in Sec.  92.206(a), while 
recommending that additional preamble language be added to the final 
rule citing additional examples of discrimination and to provide 
confirmation that OCR's investigations will not be limited by the 
enumerated examples in Sec.  92.206(b).
    Response: We emphasize that Sec.  92.206(b) is not an exhaustive 
list of all scenarios that would constitute of sex discrimination under 
the rule. We have provided additional examples of sex discrimination in 
this preamble, and OCR's investigations will not be limited by the 
enumerated forms of discrimination addressed in Sec.  92.206(b) or 
elsewhere.
    Comment: One commenter stated that OCR ignored Burwell v. Hobby 
Lobby, 573 U.S. 682 (2014), in the Proposed Rule and that the Proposed 
Rule is comparable to the Department's actions in that case, in which 
the Court found that the government's compelling interest in protecting 
women's health could be accomplished in a less restrictive manner.
    Response: OCR has considered Hobby Lobby and will be mindful of it 
when carrying out enforcement of the final rule. For a further 
discussion of views regarding application of Federal conscience or 
religious freedom laws, refer to Sec.  92.302.
Summary of Regulatory Changes
    For the reasons set forth above and considering the comments 
received, we are finalizing the provision as proposed in Sec.  92.206, 
with modifications. We have revised Sec.  92.206(b)(1) to state: ``Deny 
or limit health services, including those that have been typically or 
exclusively provided to, or associated with, individuals of one sex . . 
. .'' We are revising Sec.  92.206(c) to remove the sentence that 
reads: ``However, a provider's belief that gender transition or other 
gender-affirming care can never be beneficial for such individuals (or 
its compliance with a state or local law that reflects a similar 
judgment) is not a sufficient basis for a judgment that a health 
service is not clinically appropriate.'' To the end of Sec.  92.206(c) 
we are adding sentences that read: ``A covered entity's determination 
must not be based on unlawful animus or bias, or constitute a pretext 
for discrimination. Nothing in this section is intended to preclude a 
covered entity from availing itself of protections described in 
Sec. Sec.  92.3 and 92.302.''

[[Page 37599]]

Nondiscrimination in Health Insurance Coverage and Other Health-Related 
Coverage (Sec.  92.207)
    In Sec.  92.207, OCR proposed to prohibit discrimination on the 
basis of race, color, national origin, sex, age, or disability in the 
provision or administration of health insurance coverage and other 
health-related coverage. This proposed section would apply to all 
covered entities that provide or administer health insurance coverage 
or other health-related coverage that receive Federal financial 
assistance, and the Department in the administration of its health-
related coverage programs.
    In Sec.  92.207(a), OCR proposed a general nondiscrimination 
requirement, and Sec.  92.207(b) proposed specific examples of 
prohibited actions.
    In Sec.  92.207(b)(1), OCR specified that covered entities are 
prohibited from denying, cancelling, limiting, or refusing to issue or 
renew health insurance coverage or other health-related coverage, or 
denying or limiting coverage of a claim, or imposing additional cost 
sharing or other limitations or restrictions on coverage, on the basis 
of race, color, national origin, sex, age, or disability.
    In Sec.  92.207(b)(2), OCR proposed prohibiting marketing practices 
or benefit designs that discriminate on the basis of race, color, 
national origin, sex, age, or disability.
    In Sec.  92.207(b)(3), OCR proposed that it is prohibited 
discrimination to deny or limit coverage, deny or limit coverage of a 
claim, or impose additional cost sharing or other limitations or 
restrictions on coverage to an individual based upon the individual's 
sex at birth, gender identity, or gender otherwise recorded. We invited 
comment on this provision, including whether it sufficiently addresses 
the challenges transgender and gender nonconforming individuals are 
experiencing when seeking access to medically necessary care due to a 
discordance between their sex assigned at birth and their sex as 
recorded by their issuer.
    In Sec.  92.207(b)(4), OCR proposed to prohibit a covered entity 
from having or implementing a categorical coverage exclusion or 
limitation for all health services related to gender transition or 
other gender-affirming care.\172\
---------------------------------------------------------------------------

    \172\ As noted in the discussion of Sec.  92.206 above, this 
preamble uses the terms ``gender transition'' and ``gender 
affirmation'' interchangeably in discussing the range of care that 
transgender individuals (including those who identify using other 
terms, for example, nonbinary or gender nonconforming) may seek to 
treat gender dysphoria and support gender transition or affirmation. 
Because insurance coverage provisions and medical-necessity 
determinations more often use the term gender transition, within 
these provisions, the term gender affirmation encompasses gender 
transition, that is the terminology used in the text of the 
regulation. The use of the term ``gender transition'' in the 
regulation, however, is not intended to convey a narrower meaning 
than the term ``gender affirmation.''
---------------------------------------------------------------------------

    In Sec.  92.207(b)(5), OCR proposed to ensure that a covered entity 
does not impose discriminatory limits on coverage for specific health 
services related to gender transition or other gender-affirming care, 
which would generally be the case if such limits are not applied when 
those same health services are not related to gender transition or 
other gender-affirming care.
    In Sec.  92.207(b)(6), OCR proposed an integration provision that 
prohibits covered entities from having or implementing a benefit design 
that does not provide or administer health insurance coverage or other 
health-related coverage in the most integrated setting appropriate to 
the needs of qualified individuals with disabilities.
    OCR sought comment on the scope and nature of the benefit design 
features that result in unjustified segregation or institutionalization 
of qualified individuals with disabilities or place such individuals at 
serious risk of institutionalization or segregation. We were interested 
in feedback on the application of the integration requirement to a wide 
variety of health services and were particularly interested in comments 
on the application of the integration requirement to coverage of post-
acute services, mental health services, and other services commonly 
provided by non-State payers (i.e., health insurance issuers, self-
insured group health plans, and other payers). OCR was also interested 
in feedback on the application of the integration requirement to the 
Medicaid program and its statutory framework at title XIX of the Social 
Security Act. Specifically, we requested input on how State Medicaid 
agencies are able to achieve compliance with the integration 
requirement through benefit design, such as through reimbursement, 
service scope, and service authorization that do not incentivize 
institutional services over community services. In addition, OCR 
requested input on the amount of time needed to reach compliance with 
needed benefit design modifications.
    In Sec.  92.207(c), OCR stated that nothing in this section 
requires the coverage of any health service where the covered entity 
has a legitimate, nondiscriminatory reason for determining that such 
health service fails to meet applicable coverage requirements, such as 
medical necessity requirements, in an individual case.
    Finally, in Sec.  92.207(d), OCR made clear that the enumeration of 
specific forms of discrimination in Sec.  92.207(b) does not limit the 
general applicability of the prohibition in Sec.  92.207(a).
    OCR generally invited comment on how section 1557 might apply to: 
provider networks; how provider networks are developed, including 
factors that are considered in the creation of the network and steps 
taken to ensure that an adequate number of providers and facilities 
that treat a variety of health conditions are included in the network; 
the ways in which provider networks limit or deny access to care for 
individuals on the basis of race, color, national origin, sex, age, or 
disability; and the extent to which the lack of availability of 
accessible medical diagnostic equipment in a provider network limits or 
denies access to care for individuals with disabilities. We also sought 
comment on the extent, scope and nature of value assessment methods 
that discriminate on the basis of race, color, national origin, sex, 
age, or disability. We were interested in feedback on the civil rights 
implications of value assessment across a wide variety of contexts, 
including utilization management, formulary design, price negotiations, 
alternative payment models and other relevant applications. Finally, 
OCR invited comment on all aspects of this section. In particular, we 
sought comment on the anticipated impact of the proposed application to 
excepted benefits and short-term, limited duration insurance (STLDI) 
when such products are offered by a covered entity; how the Proposed 
Rule's nondiscrimination requirements would impact the industry that 
offers excepted benefits and STLDI and the consumers who rely upon 
those products; the prevalence of excepted benefits and STLDI offered 
by covered entities and the standard industry practices under which 
such plans are designed and administered; and excepted benefits and 
STLDI plans' scope of coverage, types of exclusions and limitations, 
underwriting practices, premium setting, and actuarial or business 
justifications for industry practices (as applicable), that may raise 
concerns about discrimination under section 1557.
    The comments and our responses regarding Sec.  92.207 are set forth 
below.
    For ease of reference, OCR may simply refer to ``health insurance 
issuers'' or ``issuers'' throughout the preamble, but other covered 
entities may also be subject to the section under

[[Page 37600]]

discussion. In addition, for purposes of this preamble only, OCR uses 
the term ``health plan'' or ``plan'' interchangeably to refer generally 
to health insurance coverage and other health-related coverage that is 
subject to this rule. As used in this preamble, ``health plan'' or 
``plan'' may include health insurance coverage or other health-related 
coverage offered in the group and individual markets, group health plan 
coverage, Medicare Advantage plans, Medicare Part D plans, and Medicaid 
programs that are subject to this rule. OCR does not intend ``health 
plan'' or ``plan'' to be regulatory terms in this regulation or to 
replace any existing or proposed term in Federal law.
    OCR notes that a variety of entities may be considered covered 
entities subject to Sec.  92.207, including but not limited to health 
insurance issuers, group health plans, Medicare Advantage 
Organizations, Medicare Part D plan sponsors, Medicaid managed care 
plans, pharmacy benefit managers, third party administrators (as part 
of a covered entity's operations when it meets the criteria in 
paragraph (2) of the definition of ``health program or activity'' under 
Sec.  92.4), and the Department.
    Comment: Commenters strongly supported the inclusion of an explicit 
provision related to prohibited discrimination in health insurance 
coverage and other health-related coverage, noting that it will help 
provide clarity for covered entities. Many commenters stated that it is 
clear from the statutory text of the ACA that Congress intended for 
section 1557 to apply to health insurance. Commenters stated that the 
2020 Rule's rescission of similar protections created confusion, was 
contrary to the intent and purpose of the ACA, and increased the burden 
on States to monitor and enforce nondiscrimination laws. Commenters 
noted that ensuring covered entities provide health insurance coverage 
and other health-related coverage in a nondiscriminatory manner will 
reduce adverse health outcomes and address some of the barriers 
vulnerable communities face in accessing health insurance coverage and 
other health-related coverage. Commenters from the health insurance 
industry were generally supportive of reinstating the section with some 
suggested modifications. This includes one commenter noting that, as an 
employer, they appreciated the Proposed Rule's clarification 
prohibiting categorical exclusions, noting that the 2016 Rule's similar 
prohibition had allowed them to negotiate a nondiscriminatory plan to 
cover their employees.
    One organizational commenter opposed to the inclusion of Sec.  
92.207 argued that health insurance issuers could face substantial 
costs, including compliance costs and claims costs, as a result of 
having to alter their coverages and business practices, which would 
result in higher premiums. This commenter also argued OCR is engaging 
in expansive and detailed regulation of numerous issuer business 
decisions in an arbitrary and capricious manner that could result in 
issuers facing heightened business risks and increased liability 
exposure.
    Response: OCR agrees that section 1557 applies broadly, including 
to prohibit discrimination by covered entities that provide or 
administer health insurance coverage and other health-related coverage. 
As discussed throughout this preamble, particularly under the 
discussion of the definition of ``health program or activity'' under 
Sec.  92.4, the ACA is clearly intended to apply to health insurance 
coverage and other health-related coverage and prohibit the 
discriminatory practices therein.
    OCR disagrees that Sec.  92.207 imposes expansive regulation of 
health insurance issuers and their business decisions in an arbitrary 
and capricious manner. The plain text of section 1557 applies to health 
insurance coverage and other health-related coverage; OCR is 
implementing Congressional intent to prohibit discrimination in health 
insurance coverage and other health-related coverage in Sec.  92.207. 
In addition to section 1557, health insurance issuers are required to 
comply with myriad State and Federal laws regulating the practice of 
health insurance coverage and other health-related coverage. These laws 
include other Federal laws that regulate health insurance coverage and 
other health-related coverage practices, including nondiscrimination 
requirements.\173\ Compliance with legal requirements, such as section 
1557, is a standard business practice as a health insurance issuer. 
Further, health insurance issuers were subject to former Sec.  92.207's 
requirements \174\ from either July 18, 2016, or January 1, 2017 (if 
plan design changes were required as a result of the 2016 Rule), 
through August 18, 2020, the effective date of the 2020 Rule.
---------------------------------------------------------------------------

    \173\ See, e.g., 42 CFR 422.100(f)(2) and (3), 422.110 (Medicare 
Advantage), 423.104(d)(2)(iii), 423.2262(a)(1)(iv) (Part D), 
438.3(d) and (f) (Medicaid managed care), and 600.405(d) (Basic 
Health Program); 45 CFR 147.104(e) (group and individual health 
insurance markets), 156.125(a) and (b) (EHB), 156.200(e), and 
156.225(b) (qualified health plans).
    \174\ Issuers were subject to those requirements except for 
provisions either enjoined or vacated through lawsuits. See, e.g., 
Franciscan Alliance v. Burwell, 227 F. Supp. 3d 660 (N.D. Tex. 
2016).
---------------------------------------------------------------------------

    Comment: Some commenters supported Sec.  92.207(b)(1), related to 
coverage denials and limitations. Some commenters asked OCR to state 
that cost sharing must not be used by covered entities in a 
discriminatory manner. Commenters acknowledged that cost sharing can be 
an effective tool, but they also expressed concern that insurance 
companies and pharmacy benefit managers are increasingly employing high 
cost sharing that disproportionately affects people with disabilities, 
chronic conditions, and other significant health needs. Commenters 
cited several studies that show patients who are uncertain about their 
ability to afford their out-of-pocket care expenses delay or forgo care 
or fall out of compliance with recommended follow-up steps.\175\ 
Commenters noted that such gaps in care can have deadly consequences 
for individuals with certain conditions, such as people living with 
HIV/AIDS.
---------------------------------------------------------------------------

    \175\ See, e.g., Joel F. Farley, Medicaid Prescription Cost 
Containment and Schizophrenia, 48 Med. Care 5, 440-47 (2010), 
https://pubmed.ncbi.nlm.nih.gov/20351586/; Teresa B. Gibson & Ronald 
J. Ozminkowski, The Effects of Prescription Drug Cost Sharing: A 
Review of the Evidence, 11 a.m.. J. Managed Care 11, 730-40 (2005), 
https://pubmed.ncbi.nlm.nih.gov/16268755/; Daniel M. Hartung et al., 
Impact of a Medicaid Copayment Policy on Prescription Drug and 
Health Services Utilization in a Fee-for-Service Medicaid 
Population, 46 Med. Care 6, 565-72 (2008), https://pubmed.ncbi.nlm.nih.gov/18520310/; Nantana Kaisaeng et al., Out-of-
Pocket Costs and Oral Cancer Medication Discontinuation in the 
Elderly, 20 J. Managed Care Pharmacy 7, 669-75 (2014), https://pubmed.ncbi.nlm.nih.gov/24967520/; Deliana Kostova & Jared Fox, 
Chronic Health Outcomes and Prescription Drug Copayments in 
Medicaid, 55 Med. Care 5, 520-27 (2017), https://pubmed.ncbi.nlm.nih.gov/28234755/; Sujha Subramanian, Impact of 
Medicaid Copayments on Patients With Cancer, 49 Med. Care 9, 842-47 
(2011), https://pubmed.ncbi.nlm.nih.gov/21577164/; Samantha Artiga 
et al., The Effects of Premium and Cost-Sharing on Low-Income 
Populations: Updated Review of Research Findings, Kaiser Family 
Found., pp.1-5 (2017), https://www.kff.org/medicaid/issue-brief/the-effects-of-premiums-and-cost-sharing-on-low-income-populations-updated-review-of-research-findings/; David B. Ridley & Kirsten J. 
Axelsen, Impact of Medicaid Preferred Drug Lists on Therapeutic 
Adherence, 24 Pharmacoeconomics Suppl. 3, 65-78 (2006), https://www.ncbi.nlm.nih.gov/pubmed/17266389.
---------------------------------------------------------------------------

    Commenters also provided examples of concerns related to cost 
sharing and patient financial assistance. A few commenters raised 
concerns about treatment of patient financial assistance, accumulator 
adjustment programs, copay maximizers, and alternative funding 
programs. Other commenters raised concerns about issuers designating 
drugs as ``non-essential-health-benefits'' to avoid certain

[[Page 37601]]

essential health benefits (EHB) requirements.\176\
---------------------------------------------------------------------------

    \176\ See section 1302 of the ACA, codified at 42 U.S.C. 18022.
---------------------------------------------------------------------------

    One organizational commenter expressed concerns about Sec.  
92.207(b)(1) and argued that this provision would impose new 
nondiscrimination tests on issuer business decisions that result in the 
denial or limitation of payment for a claim, on variations in cost 
sharing under the terms of a health plan, or on the imposition of other 
limitations or restrictions on coverage. The commenter argued this 
would result in expansive and detailed regulation of numerous issuer 
business decisions in an arbitrary and capricious manner.
    Response: OCR appreciates commenters' concerns regarding cost 
sharing, which is explicitly addressed in Sec.  92.207(b)(1). Covered 
entities are prohibited from ``impos[ing] additional cost sharing or 
other limitations or restrictions on coverage, on the basis of race, 
color, national origin, sex, age, or disability.'' We disagree with the 
commenter's concerns that this provision arbitrarily or capriciously 
imposes new nondiscrimination tests on issuer business decisions. 
Covered entities subject to this rule are prohibited from engaging in 
unlawful discrimination in their health programs or activities, 
including in health insurance coverage or other health-related 
coverage. Cost sharing is standard industry practice that is a feature 
of an issuer's health insurance coverage or other health-related 
coverage. Nothing in this rule dictates the business decisions an 
issuer should make in establishing its coverage limitations, including 
with regard to cost sharing. To the extent an issuer imposes cost 
sharing in its coverage, it cannot do so in a discriminatory manner. 
Comments related to violations of EHB requirements are outside the 
scope of this regulation.\177\
---------------------------------------------------------------------------

    \177\ See 42 U.S.C. 18022, 300gg-6(a); 45 CFR 156.100 through 
165.155.
---------------------------------------------------------------------------

    Comment: Commenters generally supported the prohibition on 
discriminatory marketing practices in Sec.  92.207(b)(2). Commenters 
discussed that covered entities might use marketing practices to 
dissuade enrollment by individuals with high-cost conditions. For 
example, commenters noted that plans present inaccurate or confusing 
information about formularies and hide or fail to provide information 
about certain drugs. Several commenters referenced a 2022 study by the 
AIDS Institute that found 57.9 percent of the 299 Exchange plan 
documents reviewed did not list PrEP (pre-exposure prophylaxis to 
prevent HIV infection) as a free preventive service, though health 
insurance issuers were required to include such coverage for all plans 
offered through the Exchanges in 2022.\178\ Commenters asked OCR to 
provide an example of discriminatory marketing practices in regulatory 
text. They further requested that OCR coordinate the study of marketing 
practices with other regulatory agencies.
---------------------------------------------------------------------------

    \178\ Letter from The AIDS Institute to Dr. Ellen Montz, Deputy 
Admin'r & Dir. (June 9, 2022), https://www.theaidsinstitute.org/letters/marketplace-insurance-plan-prep-compliance. In general, 
under section 2713 of the PHS Act and its implementing regulations, 
plans and issuers must provide coverage, without cost sharing, for 
recommended preventive services for plan years (in the individual 
market, policy years) that begin on or after the date that is 1 year 
after the date the recommendation or guideline is issued. 26 CFR 
54.9815-2713(b); 29 CFR 2590.715-2713(b); 45 CFR 147.130(b).
---------------------------------------------------------------------------

    Response: OCR concurs with the importance of ensuring that an 
issuer's marketing practices are not designed or implemented in a way 
that discriminates against individuals with a specific disability or on 
any other basis prohibited under section 1557. Inaccuracies or 
omissions in plan marketing materials may impede an individual's 
ability to determine what treatments and services are covered. While 
certain inaccuracies or omissions in marketing materials may not be 
prohibited discrimination under this section, inaccuracies or omissions 
that were intended to or resulted in discouraging individuals from 
enrolling in health insurance coverage and other health-related 
coverage or steering individuals away from enrolling in health 
insurance coverage and other health-related coverage on the basis of 
disability or other prohibited basis would raise concerns of prohibited 
discrimination. The determination of whether a particular marketing 
practice is prohibited under this section requires a case-by-case 
analysis dependent on the facts of the challenged marketing practice. 
Accordingly, OCR declines to specify particular examples in the 
regulation, though we included an example in the Proposed Rule, stating 
that covered entities that avoid advertising in areas populated by a 
majority of people of color to reduce the enrollment of people of color 
in their health insurance coverage could violate Sec.  92.207. 87 FR 
47869-70. We note that covered entities may be subject to other 
Departmental and Federal regulations governing marketing 
practices.\179\ While OCR declines to coordinate a study of marketing 
practices, we continue to coordinate with other regulatory agencies on 
health insurance-related matters.
---------------------------------------------------------------------------

    \179\ See, e.g., 45 CFR 147.104(e) (health insurance issuers 
offering coverage in the individual and group markets) and 
156.225(b) (qualified health plans); 42 CFR 423.2263 (Medicare Part 
D marketing requirements).
---------------------------------------------------------------------------

    We note that individuals with LEP or disabilities may face 
challenges in accessing a covered entity's marketing materials. This 
final rule addresses such concerns in multiple ways, including by 
requiring covered entities to provide a Notice of Nondiscrimination 
under Sec.  92.10; a Notice of Availability under Sec.  92.11 
(including in member handbooks at Sec.  92.11(c)(5)(x)); taking 
reasonable steps to provide meaningful access to individuals with LEP 
under Sec.  92.201; and taking appropriate steps to ensure effective 
communication for individuals with disabilities under Sec.  92.202.
    Comment: Numerous commenters supported the prohibition on 
discriminatory health plan benefit designs in Sec.  92.207(b)(2). 
Commenters stated that covered entities employ many features of benefit 
design and delivery to deny coverage or discourage people with 
significant or high-cost health needs from enrolling in their plans. 
These include exclusions, cost sharing, formularies, visit limits, 
provider networks, service areas, benefit substitutions, prior 
authorization, and other utilization management that the commenters 
allege are arbitrary and not clinically based or appropriate.
    Some commenters requested that OCR define the term ``benefit 
design'' or include specific examples of benefit design features in the 
regulatory text of Sec.  92.207(b)(2). While some commenters expressed 
concern that failing to define benefit design in the regulation would 
result in a lack of clarity as to what the rule prohibits, other 
commenters supported OCR's proposed approach to avoid defining the term 
in a prescriptive manner.
    One organizational commenter opposed Sec.  92.207(b)(2) as imposing 
nondiscrimination tests on insurance benefit design, which the 
commenter argued would result in expansive and detailed regulation of a 
number of issuer business decisions in an arbitrary and capricious 
manner.
    Response: Benefit design features may result in a discriminatory 
denial of access to medically necessary care, particularly for 
individuals with disabilities who have significant health needs. To 
address this concern, covered entities are explicitly prohibited from 
having or implementing benefit designs

[[Page 37602]]

that discriminate on any protected basis as set forth under Sec.  
92.207(b)(2).
    We decline to define ``benefit design'' or specify types of benefit 
design features in the regulatory text. Section 92.207(b)(2) 
sufficiently notifies covered entities that discriminatory benefit 
designs are prohibited under this rule. In addition, we seek to avoid 
being overly prescriptive or unintentionally inconsistent with other 
Departmental regulations that may define benefit design.\180\ While OCR 
declines to provide examples of specific benefit design features in the 
regulatory text, for purposes of applying section 1557 and this final 
rule, examples of benefit design features include, but are not limited 
to, coverage, exclusions, and limitations of benefits; prescription 
drug formularies; cost sharing (including copays, coinsurance, and 
deductibles); utilization management techniques (such as step therapy 
and prior authorization); medical management standards (including 
medical necessity standards); provider network design; and 
reimbursement rates to providers and standards for provider admission 
to participate in a network.
---------------------------------------------------------------------------

    \180\ Other Departmental and Federal regulations governing 
private health insurance and public health coverage refer to 
``benefit design'' and ``marketing practices.'' See, e.g., 45 CFR 
147.104(e), 156.20, 156.125(a) (health insurance issuers offering 
coverage in the individual and group markets), 156.200(b)(3), 
156.225(b) (qualified health plans), 156.110(d), and 
156.111(b)(2)(v) (EHB benchmark plans); 42 CFR 422.100(f)(3) 
(Medicare Advantage), 423.2263 (Medicare Part D marketing 
requirements), 423.882, 423.894(d) (Medicare retiree prescription 
drug plans), 440.347(e) (Medicaid benchmark plans), and 600.405(d) 
(Basic Health Program); 29 CFR 2510.3-40(c)(1)(iv)(A) (multiple 
employer welfare arrangements under ERISA).
---------------------------------------------------------------------------

    OCR disagrees with the organizational commenter's concern that this 
provision arbitrarily or capriciously imposes new nondiscrimination 
tests on issuer business decisions. This section does not dictate what 
business decisions an issuer must make in establishing its benefit 
design and does not specify any particular design feature must be 
included. OCR acknowledges that issuers have discretion in designing 
their plans; however, they must do so in a nondiscriminatory manner as 
discussed throughout this section.
    Comment: Commenters requested that OCR provide a non-exhaustive 
list of presumptively discriminatory benefit design examples. Some 
commenters also suggested that OCR incorporate the presumptively 
discriminatory benefit design examples provided in CMS' EHB regulations 
\181\ or otherwise rely on other nondiscrimination provisions in CMS 
regulations implementing the ACA. Commenters stated that allowing plan 
discretion on every benefit other than gender dysphoria undercuts the 
regulation. Many commenters stated that OCR should recognize that most 
benefit design elements are inherently discriminatory as they apply 
disproportionately to individuals with disabilities and chronic 
conditions. Commenters expressed concerns that without presumptively 
discriminatory benefit design examples, issuers will adopt designs that 
exclude or make lifesaving treatments unaffordable for individuals in 
protected categories. Commenters noted that such designs include cost-
sharing requirements, restrictive medical necessity standards, narrow 
networks, drug formularies, adverse tiering, benefit substitution, 
utilization managements, exclusions, visit limits, quantity limits, 
waiting periods, service areas, and coercive wellness programs.
---------------------------------------------------------------------------

    \181\ See Patient Protection and Affordable Care Act; HHS Notice 
of Benefit & Payment Parameters for 2023, 87 FR 27208, 27301-02 (May 
6, 2022).
---------------------------------------------------------------------------

    Response: OCR declines to provide specific examples of 
presumptively discriminatory benefit designs in the rule due to the 
fact-intensive analysis needed to determine whether a particular 
benefit design feature is discriminatory under this section. We also 
decline to give examples of presumptively discriminatory benefit 
designs similar to those in EHB regulations applicable to non-
grandfathered health insurance coverage in the individual and small 
group markets that CMS finalized in the preamble of its Notice of 
Benefit and Payment Parameters for 2023 final rule.\182\ Essential 
health benefits are governed by CMS regulations and not by this final 
rule. While many of the practices cited by CMS would raise concerns of 
prohibited discrimination under this rule, OCR's determinations that a 
particular benefit design is discriminatory will be a fact-specific 
inquiry that OCR will conduct on a case-by-case basis. OCR's process 
for analyzing claims of discrimination in benefit design is discussed 
in more detail under the Benefit Design Analysis discussion later in 
this section. OCR will consider issuing guidance on discriminatory 
practices prohibited under this section in future guidance.
---------------------------------------------------------------------------

    \182\ Patient Protection and Affordable Care Act; HHS Notice of 
Benefit & Payment Parameters for 2023, 87 FR 27208, 27301-05 (May 6, 
2022) (providing the following examples of presumptively 
discriminatory benefit designs under CMS' EHB nondiscrimination 
regulations applicable to non-grandfathered health insurance 
coverage in the individual and small group markets: (1) limitation 
on hearing aid coverage based on age; (2) autism spectrum disorder 
coverage limitations based on age; (3) age limits for infertility 
treatment coverage when treatment is clinically effective for the 
age group; (4) limitation on foot care coverage based on diagnosis 
(whether diabetes or another underlying medical condition); and (5) 
access to prescription drugs for chronic health conditions (adverse 
tiering)). We note these regulations are enforced by CMS and are 
distinct from section 1557 and other civil rights laws enforced by 
OCR.
---------------------------------------------------------------------------

    OCR disagrees that the prohibition against categorical exclusions 
or limitations of coverage for all health services related to gender 
transition or other gender-affirming care under Sec.  92.207(b)(4) 
undercuts the regulation. Such explicit, categorical exclusions or 
limitations impermissibly single out an entire category of services 
based on an individual's transgender status and are presumptively 
discriminatory on the basis of sex as prohibited under this section. As 
discussed in detail under Sec.  92.206, this rule includes specific 
provisions related to gender-affirming care given the widespread 
discriminatory denial of care for such services and its direct 
connection to an individual's transgender status.\183\ As discussed in 
more detail below, covered entities may raise a defense under Sec.  
92.207(c) where they contend that they have a legitimate, 
nondiscriminatory basis for a coverage limitation that may otherwise 
appear to constitute discrimination. Recipients may also rely upon 
Sec. Sec.  92.3 and 92.302(a) or request an assurance of exemption 
under Sec.  92.302(b) based on their view that religious freedom or 
conscience protections apply.
---------------------------------------------------------------------------

    \183\ See, e.g., Bos. All. of Gay, Lesbian, Bisexual & 
Transgender Youth v. U.S. Dep't of Health & Hum. Servs., 557 F. 
Supp. 224, 239 (D. Mass. 2021) (``[p]laintiffs have shown a 
substantial risk that insurers will deny reimbursement for treatment 
they previously covered based on the elimination of the prohibition 
on categorical coverage exclusions. Out2Enroll's analysis indicates 
that ``the number of insurers using transgender-specific exclusions 
. . . more than doubled'' after HHS promulgated the 2020 Rule.'').
---------------------------------------------------------------------------

    We also decline to incorporate examples of presumptively 
discriminatory benefit designs similar to those in EHB regulations 
applicable to non-grandfathered health insurance coverage \184\ in the 
individual and small group markets that CMS finalized in the preamble 
of its Notice of Benefit and Payment Parameters for 2023 final rule. 
Essential health benefits are governed by CMS regulations and are not 
addressed by this final rule. While many of the practices cited by CMS 
would raise concerns of prohibited

[[Page 37603]]

discrimination under this rule, OCR's determinations that a particular 
benefit design is discriminatory will be a fact-specific inquiry that 
OCR will conduct on a case-by-case basis. OCR's process for analyzing 
claims of discrimination in benefit design is discussed in more detail 
under the Benefit Design Analysis discussion later in this section. OCR 
will consider issuing guidance on discriminatory practices prohibited 
under this section in future guidance.
---------------------------------------------------------------------------

    \184\ In general, health coverage is considered grandfathered if 
it was in existence and has continuously provided coverage for 
someone (not necessarily the same person, but at all times at least 
one person) since March 23, 2010, provided the plan (or its sponsor) 
or the issuer has not taken certain actions resulting in the plan 
relinquishing grandfathered status, as more fully described at 26 
CFR 54.9815-1251, 29 CFR 2590.715-1251, and 45 CFR 147.140.
---------------------------------------------------------------------------

    Comment: Commenters asked OCR to include examples of discriminatory 
benefit design specifically related to prescription drug formularies. 
These commenters provided examples of practices they considered to be 
discriminatory, such as issuers placing most or all drugs used in the 
treatment of certain conditions into the highest cost sharing tier; 
excluding single tablet regimens even when they are the standard of 
care for a condition; requiring the use of specialty pharmacy programs 
that require mail delivery even when that adds unnecessary and 
burdensome administrative barriers and delays to obtaining drugs; and 
using quantity limits for an entire class of medications without 
scientific or clinical explanation. Commenters expressed concerns that 
discriminatory prescription drug formularies discourage enrollment 
among certain populations, including individuals with HIV, mental 
health needs, or other chronic conditions. Commenters noted that 
enrollees who need high-cost medications often must choose between 
plans that will provide adequate coverage of their medication or plans 
that cover their preferred providers. A commenter cited a study that 
showed that Black and Hispanic/Latino people are more likely to abandon 
medications at the pharmacy because of high cost.\185\ Finally, some 
commenters recommended that OCR develop specific mechanisms to monitor 
prescription drug formulary practices and coverage of physician-
administered ``medical benefit'' drugs to ensure that formularies are 
not used to discriminate against patients with specific disabilities.
---------------------------------------------------------------------------

    \185\ PhRMA, Patient Experience Survey: Barriers to Health Care 
Access in the Patient Experience, pp. 10-11 (2021), https://phrma.org/-/media/Project/PhRMA/PhRMA-Org/PhRMA-Org/PDF/P-R/PES-Report_100621_Final.pdf (stating that utilization management 
disproportionately impacts people of color (Black Americans (56 
percent) and Hispanic Americans (60 percent) versus white Americans 
(36 percent)) and that barriers imposed by utilization management 
can contribute to poor medication adherence or prescription 
abandonment).
---------------------------------------------------------------------------

    Response: Benefit design practices related to prescription drugs 
have an enormous impact on individuals' access to medically necessary 
medication. Coverage of prescription drugs could pose concerns of 
prohibited discrimination and OCR would investigate such practices 
under the rule on a case-by-case basis. OCR declines to state that 
specific practices are per se discriminatory under the rule because 
each investigation is a fact-specific inquiry, based on 
nondiscrimination principles and relevant case law,\186\ including 
consideration of the covered entity's reason for the design feature in 
question.
---------------------------------------------------------------------------

    \186\ See, e.g., Doe v. CVS Pharmacy, Inc., 982 F.3d 1204, 1212 
(9th Cir. 2020); Doe v. BlueCross BlueShield of Tenn., 926 F.3d 235, 
241 (6th Cir. 2019).
---------------------------------------------------------------------------

    As discussed in the Proposed Rule, several benefit design practices 
related to drug formularies could be discriminatory under this section, 
including prescription drug formularies that place utilization 
management controls on most or all drugs that treat a particular 
condition regardless of their costs without placing similar utilization 
management controls on most or all drugs used to treat other 
conditions, and benefit designs that place utilization management 
controls on most or all services that treat a particular disease or 
condition but not others. 87 FR 47874. OCR notes that coverage of 
physician-administered ``medical benefit'' drugs would be considered 
part of a plan's benefit design and therefore subject to this rule.
    While we identify some prescription drug practices above that may 
raise concerns under section 1557, this rule does not prohibit covered 
entities from engaging in nondiscriminatory practices related to 
prescription drug benefit design. For example, covered entities may 
utilize preferred drug lists, such as preferred drug lists under the 
Medicaid program under title XIX of the Social Security Act, as long as 
the coverage criteria does not constitute prohibited discrimination. In 
addition, as discussed in more detail below, covered entities are not 
prohibited from applying nondiscriminatory utilization management 
techniques in their drug formularies.
    Comment: Many commenters expressed concerns about benefit designs 
that impose coverage limitations or exclusions related to health 
services that could result in discrimination on the basis of 
disability. For example, some commenters argued that plans should not 
be permitted to have blanket exclusions for services related to ASD or 
applied behavioral analysis (ABA) therapy, a therapeutic intervention 
sometimes recommended for autistic children.
    Several commenters raised concerns about how frequently insurance 
benefit design practices inappropriately limit coverage of durable 
medical equipment. Commenters noted that issuers place unique annual 
coverage caps on items such as wheelchairs, ventilators, and hearing 
aids. A commenter noted an example of an individual with hearing loss 
that requires treatment other than cochlear implants being denied 
coverage of hearing aids and outpatient visits to an audiologist due to 
their issuer's blanket exclusion of programs or treatments for hearing 
loss other than cochlear implants. Another commenter noted that issuers 
limit coverage of multiple-use speech-generating devices, which are 
most useful and effective for autistic individuals, even when those 
devices are less expensive than single-use speech generating devices.
    Other commenters expressed concerns that covered entities include 
clinically inappropriate limits on the coverage of habilitative and 
rehabilitative services and devices. Commenters noted that such 
limitations, including on the number of covered visits, discriminate 
against people with more significant disabilities who need extensive 
habilitation or rehabilitation in order to gain, regain, or maintain 
functioning. Commenters requested that OCR clarify that blanket 
limitations or exclusions of habilitative services for individuals with 
specific disabilities are prohibited discrimination under section 1557 
when those same services are allowed for rehabilitation of nondisabled 
persons. Commenters noted that people with developmental disabilities 
are routinely denied coverage for habilitative services needed to gain 
skills or improve functioning while an identical service is covered for 
individuals who require it for rehabilitative care to restore 
functioning. For example, a commenter noted that coverage of ``speech 
therapy to restore speech'' results in excluding all children with 
developmental delays who need the therapy to attain speech. Commenters 
noted that habilitative services are important for children who are 
delayed in walking or talking or need to learn other muscular skills 
for the first time and for individuals with disabilities to be able to 
live as independently as possible.
    Response: OCR appreciates the variety of concerns raised by 
commenters. A coverage limitation or exclusion that is based on a 
specific disability or condition (or other basis prohibited by section 
1557, such as age, discussed below), would be investigated as

[[Page 37604]]

potentially discriminatory under this rule. Blanket exclusions of all 
treatments related to a particular condition, such as ASD or hearing 
loss, would raise significant concerns of prohibited discrimination on 
the basis of disability such that OCR would expect the covered entity 
to provide a legitimate, nondiscriminatory reason for the exclusion. 
Non-categorical exclusions or limitations for certain treatments 
related to a specific disability or condition may also raise concerns 
under the rule. This rule, however, does not require covered entities 
to cover all services related to a specific disability or condition. 
Application of standard disability discrimination principles requires a 
specific analysis of each claimed exclusion. We therefore decline to 
expressly state that a particular coverage exclusion or limitation is 
per se discriminatory on the basis of disability under this rule. 
Determinations of whether a particular coverage exclusion or limitation 
is discriminatory will be evaluated on a case-by-case basis, in 
accordance with longstanding civil rights principles and relevant case 
law, as discussed throughout this section. When investigating a 
potentially discriminatory exclusion or limitation, OCR will consider 
whether the covered entity has a legitimate, nondiscriminatory reason 
for the challenged design feature. If OCR determines that the covered 
entity's reason is a legitimate, nondiscriminatory reason that is not a 
pretext for discrimination, OCR will conclude that the challenged 
exclusion or limitation is not prohibited under the rule.
    Regarding durable medical treatment, the commenters' example of 
exclusions of coverage for programs or treatments for hearing loss 
other than cochlear implants has been the subject of at least two court 
cases where the courts have held that such exclusions do not state a 
claim for proxy disability discrimination under section 1557.\187\
---------------------------------------------------------------------------

    \187\ Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 
945, 960 (9th Cir. 2020); E.S. v. Regence BlueShield, No. 2:17-cv-
01609-RAJ, 2022 WL 279028, at *8-9 (W.D. Wash., Jan. 31, 2022).
---------------------------------------------------------------------------

    We also note that health insurance issuers may be subject to other 
Departmental authorities that are relevant to issues raised by 
commenters.\188\ For example, to the extent durable medical equipment 
is an EHB, like hearing aids are in some states, covered entities may 
also be subject to CMS' EHB nondiscrimination regulations at 45 CFR 
156.125 applicable to non-grandfathered health insurance coverage in 
the individual and small group markets.\189\ Further, CMS' EHB 
regulations require coverage of habilitative services and devices, and 
specify that plans may not impose limits on coverage of habilitative 
services and devices that are less favorable than limits imposed on 
coverage of rehabilitative services and devices.\190\
---------------------------------------------------------------------------

    \188\ See, e.g., Paul Wellstone and Pete Domenici Mental Health 
Parity and Addiction Equity Act of 2008 (MHPAEA).
    \189\ See Patient Protection and Affordable Care Act; HHS Notice 
of Benefit and Payment Parameters for 2023, 87 FR 27208, 27301-02 
(May 6, 2022) (concluding that age limitations on hearing aid 
coverage are presumptively discriminatory under 45 CFR 156.125 when 
applied to EHB and there is no clinical basis for the age 
distinction). We note these regulations are enforced by CMS and are 
distinct from section 1557 and other civil rights laws enforced by 
OCR.
    \190\ 45 CFR 156.110(a)(7) and 156.115(a)(5)(ii).
---------------------------------------------------------------------------

    Comment: Many commenters raised concerns related to mental health 
services. Commenters asked OCR to require both public and private 
payers to remedy the current inadequacies and inequities in mental 
health service reimbursement rates and policies, explaining that 
reimbursement rates have been historically lower for mental health 
services than physical health services. Commenters also identified a 
range of specific mental health benefit design inequities, including 
the need for intermediate-care facility coverage for high-use patients 
with non-urgent care needs to mobile crisis response that is on par to 
that of physical emergency response. Commenters also requested that the 
rule align with the mental health parity protections in the Paul 
Wellstone and Pete Domenici Mental Health Parity and Addiction Equity 
Act of 2008 (MHPAEA).
    Response: OCR acknowledges commenters' concerns regarding coverage 
for mental health services. Mental health services may be needed by 
people who may or may not be individuals with disabilities under this 
rule. OCR will examine complaints alleging less favorable treatment for 
mental health coverage as compared to physical health coverage on a 
case-by-case basis to determine if the coverage discriminates against 
people with disabilities. Reimbursement rates and policies are subject 
to Sec.  92.207 as part of a plan's benefit design, and thus must be 
provided in a nondiscriminatory manner. We also discuss reimbursement 
rates in the context of the integration provision under Sec.  
92.207(b)(6).
    We decline to incorporate or align this rule with MHPAEA, as 
section 1557 is a distinct Federal civil rights law. We note that 
coverage limitations found to violate section 1557 may also be 
prohibited under MHPAEA.\191\
---------------------------------------------------------------------------

    \191\ The Paul Wellstone and Pete Domenici Mental Health Parity 
and Addiction Equity Act of 2008 (MHPAEA), Public Law 110-343; 42 
U.S.C. 300gg-26 (HHS); 29 U.S.C. 1185a (Department of Labor); 26 
U.S.C. 9812 (Department of Treasury), and implementing regulations 
at 45 CFR 146.136 and 45 CFR 147.160, 29 CFR 2590.712, and 26 CFR 
54.9812-1, respectively; The Departments of the Treasury, Labor, and 
HHS also published proposed rules on August 3, 2023 (88 FR 51552), 
to amend existing regulations and establish new regulations for the 
nonquantitative treatment limitation comparative analyses required 
under MHPAEA, as amended by the Consolidated Appropriations Act, 
2021. The proposed rules would amend the existing rules to prevent 
group health plans and health insurance issuers offering group or 
individual health insurance coverage that provides both medical and 
surgical benefits and mental health or substance use disorder 
benefits from using nonquantitative treatment limits to place 
greater limits on access to mental health and substance use disorder 
benefits as compared to medical/surgical benefits; see also U.S. 
Dep't of Labor, U.S. Dep't of Health & Hum. Servs., U.S. Dep't of 
the Treasury, 2022 MHPAEA Report To Congress: Realizing Parity, 
Reducing Stigma, and Raising Awareness: Increasing Access to Mental 
Health and Substance Use Disorder Coverage (2022), https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/report-to-congress-2022-realizing-parity-reducing-stigma-and-raising-awareness.pdf; U.S. Dep't of Labor, 
Self-Compliance Tool for the Mental Health Parity and Addiction 
Equity Act (MHPAEA), p. 38 (2020), https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/mental-health-parity/self-compliance-tool.pdf.
---------------------------------------------------------------------------

    Comment: Commenters expressed concerns about issuers discriminating 
against enrollees based on age through certain benefit designs. 
Commenters provided examples of practices they believed to be 
discriminatory, such as issuers requiring an ASD diagnosis by a certain 
age to access coverage for ASD-related health care; not covering 
hearing aids for adults when otherwise covered for children; and 
imposing limitations on wheelchair and mobility device replacement for 
children that fail to align with how quickly children outgrow such 
devices. One commenter asked that OCR require issuers to attest that 
their pediatric benefit packages are comprehensive and age-appropriate 
by demonstrating that physical and mental health benefits do not have 
age, visit, or coverage limits that are not based on medical necessity 
or that are based on adult metrics. Commenters noted that plans that 
limit coverage to specific conditions or a child's capacity to attain a 
certain functional status will unfairly prevent many children with 
special health care needs from accessing critically important services.
    Response: Section 1557 prohibits discrimination on the basis of 
age, consistent with the Age Act and its implementing regulations. The 
Age Act allows age distinctions under certain circumstances, including 
distinctions

[[Page 37605]]

that reasonably take into account age as a factor necessary to the 
normal operation or the achievement of any statutory objective \192\ of 
a program or activity; are based on age-related factors that bear a 
direct and substantial relationship to the normal operation of the 
program or activity or to the achievement of a statutory objective; 
provide special benefits to the elderly or children; or are contained 
in a rule or regulation issued by the Department.\193\ As a result, not 
all age-related distinctions in State or Federal law, including 
Department regulations, are prohibited by section 1557.\194\ As noted 
above, these permissible age distinctions form part of the ``ground'' 
of discrimination prohibited under the Age Act, because they identify 
distinctions that either are not forbidden age discrimination, 42 
U.S.C. 6103(b)(1)(A) (``reasonably takes into account age as a factor 
necessary to the normal operation or the achievement of any statutory 
objective of such program or activity''), or are not age discrimination 
at all, id. section 6103(b)(1)(B) (``based upon reasonable factors 
other than age'').
---------------------------------------------------------------------------

    \192\ 45 CFR 91.12(b) (Defining ``Statutory objective'' to mean 
``any purpose of a program or activity expressly stated in any 
Federal statute, State statute, or local statute or ordinance 
adopted by an elected, general purpose legislative body.'').
    \193\ See 42 U.S.C. 6103(b); 45 CFR 91.12 through 91.14 and 
91.17.
    \194\ See, e.g., 42 U.S.C. 300gg; 45 CFR 147.102 (permitting 
premium rates charged by a health insurance issuer for health 
coverage offered in the individual or small group market to vary 
with respect to the particular plan of coverage by age, among other 
factors).
---------------------------------------------------------------------------

    When investigating a benefit design with an age distinction, OCR 
will first determine whether the distinction is permitted under the Age 
Act (and therefore section 1557). If it is not, OCR will then 
investigate the age distinction to determine whether it violates 
section 1557. As with other benefit design investigations, OCR's 
analysis will involve a fact-specific inquiry and will consider a 
covered entity's reason for the age distinction in its benefit design. 
The covered entity's justification must be a legitimate, 
nondiscriminatory reason, as discussed under Sec.  92.207(c). For 
example, if an issuer is not able to provide a legitimate, 
nondiscriminatory reason to substantiate an age distinction in ASD 
coverage, such an age distinction would likely violate section 1557. We 
reiterate that this rule does not require a covered entity to provide 
coverage for all health services related to a particular disability or 
condition; rather, it requires covered entities to design their plan 
benefits in a nondiscriminatory manner. We note that covered entities 
may also be subject to relevant CMS EHB nondiscrimination regulations 
regarding presumptively discriminatory age distinctions.\195\
---------------------------------------------------------------------------

    \195\ See, e.g., Patient Protection and Affordable Care Act; HHS 
Notice of Benefit & Payment Parameters for 2023, 87 FR 27208, 27301-
02 (May 6, 2022) (providing examples of presumptively discriminatory 
benefit designs under CMS' EHB nondiscrimination regulations 
applicable to non-grandfathered health insurance coverage in the 
individual and small group markets that include limitations on 
hearing aid coverage based on age, autism spectrum disorder coverage 
limitations based on age, and age limits for infertility treatment 
coverage when treatment is clinically effective for the age group). 
These regulations are enforced by CMS and are distinct from section 
1557 and other civil rights laws enforced by OCR.
---------------------------------------------------------------------------

    OCR does not agree that it is necessary to require a separate 
attestation related to pediatric benefit packages. As recipients of 
Federal financial assistance, issuers are required to submit an 
Assurance of Compliance with section 1557 under Sec.  92.5, which 
attests that they will not discriminate on the basis of age, among 
other prohibited bases.
    Comment: A commenter requested that OCR clarify the obligation of 
issuers and plan administrators to ensure that their staff, as well as 
the staff of any subsidiary entities with which they do business, 
receive explicit training on the relationship between benefit design 
choices and practices and activities that can amount to discrimination 
based on race, color, national origin, sex, age or disability.
    Response: Covered entities are responsible for ensuring their 
staff, subrecipients, and subcontractors are compliant with section 
1557. Section 92.9 requires covered entities to provide training to 
relevant employees on their section 1557 Policies and Procedures, and 
while we note that it is in a covered entity's best interest to ensure 
that relevant staff are adequately trained, we decline to specify 
additional training requirements at this time.
    Comment: Commenters requested that the final rule expressly state 
that section 1557 prohibits proxy discrimination in benefit design, 
either in the preamble or regulation. Commenters expressed concern that 
absent express incorporation of proxy principles, covered actors may 
attempt to evade section 1557's nondiscrimination provisions. A 
commenter requested that the final rule incorporate established 
discrimination principles and noted that issuers continue to justify 
discriminatory plan designs by taking the position that health plans 
that target a particular medical service rather than a disability are 
neutral or uniform with respect to all enrollees. As an example, the 
commenter noted that plans restricting coverage of dialysis justify it 
as not being discriminatory against enrollees with end-stage renal 
disease. The commenter requested that the final rule declare that 
discriminatory plan designs that limit dialysis treatment are a form of 
prohibited disability discrimination under section 1557 due to the fact 
that dialysis services are a near perfect proxy for end-stage renal 
disease, according to the commenter.
    Response: Proxy discrimination occurs when a policy or practice 
treats individuals differently on the basis of seemingly neutral 
criteria that are so closely associated with the disfavored group that 
discrimination on the basis of such criteria is, constructively, facial 
discrimination against the disfavored group.\196\ Proxy discrimination 
is one of many basic civil rights theories available to OCR when 
investigating complaints under section 1557 and which courts have 
applied in cases alleging discrimination under section 1557.\197\ Due 
to the fact-intensive nature of the analysis necessary, including 
determinations of whether a particular benefit design is 
discriminatory,\198\ we decline to expressly include this theory of 
discrimination in the rule text. As we have noted above, all claims 
under this section will be evaluated on a case-by-case basis.
---------------------------------------------------------------------------

    \196\ Schmitt v. Kaiser Found. Health Plan of Wash., 965 F.3d 
945, 958 (9th Cir. 2020) (citing Davis v. Guam, 932 F.3rd 822, 837 
(9th Cir. 2019)).
    \197\ See, e.g., Schmitt v. Kaiser Found. Health Plan of Wash. 
No. 2:17-cv-01611-RSL, 2018 WL 4385858 (W.D. Wash. Sept. 14, 2018), 
aff'd in part, rev'd in part and remanded, 965 F.3d 945 (9th Cir. 
2020); E.S. v. Regence BlueShield, No. 2:17-CV-01609-RAJ, 2022 WL 
279028, at *1 (W.D. Wash. Jan. 31, 2022).
    \198\ See, e.g., Schmitt v. Kaiser Found. Health Plan of Wash., 
No. 2:17-cv-01611-RSL, 2018 WL 4385858 (W.D. Wash. Sept. 14, 2018), 
aff'd in part, rev'd in part and remanded, 965 F.3d 945 (9th Cir. 
2020); E.S. v. Regence BlueShield, No. 2:17-CV-01609-RAJ, 2022 WL 
279028, at *1 (W.D. Wash. Jan. 31, 2022).
---------------------------------------------------------------------------

    Comment: Some commenters noted that health insurance coverage and 
other health-related coverage may employ coverage limitations that are 
facially neutral and apply to all enrollees but have a disparate impact 
on a basis protected under section 1557. Specifically, commenters 
observed that these limitations and exclusions can have a particular 
discriminatory effect on individuals with disabilities who have chronic 
conditions and significant health needs.
    Response: OCR utilizes all applicable causes of action when 
investigating potential discrimination under section 1557 consistent 
with relevant case law. For further discussion related to OCR's 
enforcement procedures, see Sec.  92.301.

[[Page 37606]]

    Comment: Commenters requested that the final rule make clear the 
language in Sec.  92.207(b), which addresses sex-related health 
services, includes the full spectrum of reproductive health services 
and treatments and medications for people with disabilities that may 
prevent, complicate, or end fertility or pregnancies.
    Response: OCR appreciates the unique challenges faced by people 
with disabilities seeking reproductive health care. Section 1557 
prohibits discrimination on prohibited bases regardless of the type of 
care an individual is seeking or receive. Therefore, we do not believe 
it is necessary to provide specific provisions related to each form of 
care an individual may seek.
    Comment: Commenters requested that the final rule expressly state 
that infertility diagnoses, treatment, and services, including assisted 
reproductive technology, if offered, must be covered without regard to 
sexual orientation, gender identity, sex characteristics (including 
intersex traits), or any other protected basis. Commenters raised 
several examples of benefit design or coverage related to assisted 
reproductive technology that they stated should be prohibited as 
discriminatory against individuals based on their relationship status 
and sexual orientation. As examples, commenters cited requiring 
enrollees to use their spouse's sperm to fertilize their eggs for in 
vitro fertilization and requiring that single enrollees or those in 
non-heterosexual relationships pay out of pocket for a predetermined 
number of failed intrauterine insemination cycles before providing 
coverage when heterosexual couples do not have to meet the same 
standard. Commenters stated that issuers justify these types of benefit 
design features on outdated definitions of infertility. A commenter 
argued that in vitro fertilization coverage should include screening 
for genetic abnormalities that are unique to enrollees' lineage as a 
matter of reproductive justice and religious freedom.
    Response: OCR agrees that to the extent plans cover infertility 
diagnosis, treatment, and services, including assisted reproductive 
technology, they must do so on a nondiscriminatory basis, including for 
same-sex couples. Due to the fact-intensive nature of the analysis 
necessary, determinations of whether a particular benefit design is 
discriminatory under this section will be evaluated on a case-by-case 
basis.
    Comment: Commenters recommended that OCR add a new paragraph to 
Sec.  92.207(b) affirming that denying or limiting coverage of, or 
coverage of a claim for, health services because they may prevent, 
cause complications to, or end fertility or pregnancies is prohibited. 
Commenters asserted this language would address discrimination by a 
State program that otherwise provides coverage of contraceptives but 
excludes a specific contraceptive because of a medically inaccurate 
assertion that the contraception causes an abortion, or a provider 
network that only includes facilities that refuse to provide certain 
types of contraception. Commenters emphasized that individuals are 
currently being improperly denied access to medications or treatments 
for care unrelated to abortion because the medicine is also used for 
abortion care.
    Response: Denying access to specific medication or health services 
that may potentially be used for medication abortion purposes but are 
prescribed for reasons unrelated to abortion care may constitute 
discrimination under section 1557.\199\ OCR finds it unnecessary to add 
any additional regulatory language to prohibit such discrimination on 
the basis of disability and sex. As noted above, simultaneous 
discrimination on multiple prohibited bases is important to account for 
and is prohibited by section 1557.
---------------------------------------------------------------------------

    \199\ See U.S. Dep't of Health & Hum. Servs., Guidance to the 
Nation's Retail Pharmacies: Obligations Under Federal Civil Rights 
Laws to Ensure Nondiscriminatory Access to Health Care at Pharmacies 
(Sept. 29, 2023), https://www.hhs.gov/civil-rights/for-individuals/special-topics/reproductive-healthcare/pharmacies-guidance/.
---------------------------------------------------------------------------

    Comment: A commenter asked OCR to provide confirmation that while 
nothing in the regulation would require a covered entity to cover 
abortions, to the extent plans do cover abortions, they must do so on a 
nondiscriminatory basis.
    Response: As the commenter stated, nothing in this rule requires 
the provision of any particular medical care, including abortion. To 
the extent plans offer coverage for termination of pregnancies and 
related services, they must do so on a nondiscriminatory basis.
    Comment: Commenters recommended that OCR revise the regulatory text 
of proposed Sec.  92.207(b)(4) and (5) to address sex discrimination 
related to pregnancy or related conditions by adding discrimination 
related to abortion, fertility care, and contraception. Some commenters 
requested that OCR specifically add ``termination of pregnancy, 
contraception, fertility care, miscarriage management, pregnancy loss, 
maternity care, other reproductive and sexual health services, or any 
health services'' to the prohibitions on exclusions, limitations, and 
cost sharing related to gender transition or other gender-affirming 
care in Sec.  92.207(b)(4) and (5).
    Response: OCR declines this suggestion. Section 92.207(b)(4) and 
(5) are not intended to list all types of potentially prohibited 
exclusions. The general prohibition on discriminatory limitations under 
Sec.  92.207(b)(1) would apply to any exclusion or limitation related 
to all types of care that resulted in discrimination on the basis of 
sex.
    Comment: Some commenters stated that they oppose Sec.  92.207 to 
the extent it violates religious freedom and conscience protections. 
Other commenters stated that they opposed Sec.  92.207 because it 
prevents plans from excluding coverage of all gender affirming care.
    Response: Section 92.207 does not violate such protections because 
providers may rely on the protections of Federal religious freedom and 
conscience laws or choose to seek assurance of those protections from 
OCR under this final rule. With respect to concerns about potential 
conflicts between provisions of the final rule and individuals' or 
organizations' conscience or religious freedom, please refer to the 
preamble discussion of Sec.  92.302. Additionally, we are revising 
Sec.  92.207(c) to specify that nothing in this section precludes a 
covered entity from availing itself of protections described in Sec.  
92.3 and Sec.  92.302. This modification is consistent with the revised 
language in Sec.  92.206(c). As noted elsewhere in this preamble, and 
in Sec.  92.3(c), insofar as the application of any rule requirement 
would violate applicable Federal protections for religious freedom and 
conscience, such application shall not be required.
    Comment: Many commenters expressed strong support for the 
provisions in Sec.  92.207(b)(3) through (5), citing the extensive 
discrimination faced by transgender people in the health insurance 
coverage and other health-related coverage context. Several legal 
service providers described their experiences assisting clients facing 
various types of discrimination in their health plans, even where State 
law or the plan terms provided some protection for gender-affirming 
care. Some commenters noted these provisions also addressed forms of 
discrimination commonly faced by intersex people. Commenters noted that 
the physical, mental health, and financial costs of such discrimination 
could be high, with individuals forgoing necessary care, facing extreme 
financial

[[Page 37607]]

burdens, and experiencing distress when denied access to necessary 
medical care.
    Both supporters and opponents of the Proposed Rule raised many of 
the same issues discussed in Sec.  92.206(b)(4) (prohibiting 
categorical coverage exclusions on gender transition or other gender-
affirming care) and (c) (discussing legitimate, nondiscriminatory 
reasons for denying or limiting care) above. As with Sec.  92.206, some 
commenters asked OCR to define gender-affirming care or provide more 
detail about what types of care must be covered.
    Response: OCR agrees that transgender and intersex people have long 
faced discrimination in the health insurance coverage and other health-
related coverage context. Many of OCR's responses to the comments in 
Sec.  92.206(b)(4) (prohibiting categorical coverage exclusions on 
gender transition or other gender-affirming care) and (c) (discussing 
legitimate, nondiscriminatory reasons for denying or limiting care) 
above are applicable to the comments in this section as well. For 
example, for the reasons we discussed above, we will not provide a 
definition of ``gender-affirming care'' in the regulation text.
    Comment: Commenters noted that even plans without categorical 
exclusions will exclude certain types of gender-affirming care as 
``cosmetic.'' Commenters noted that categorizing procedures as cosmetic 
when needed for gender-affirming care is contrary to established 
standards of care for the treatment of gender dysphoria and urged OCR 
to explicitly prohibit such procedure-specific exclusions. Some 
commenters further noted that plans will often consider these 
procedures on a case-by-case basis when not related to gender 
transition but will not do so when the care is related to gender 
transition.
    Many commenters recommended deleting the word ``all'' from Sec.  
92.207(b)(4) to make clear that the exclusion of any gender-affirming 
care from coverage is prohibited. Some commenters stated that this 
change would be more consistent with Sec.  92.207(b)(5), which more 
generally prohibits discriminatory limits on gender-affirming care 
coverage.
    Response: OCR appreciates commenters' feedback and concern about 
forms of discrimination beyond broad categorical coverage exclusions. 
While we understand that some gender-affirming care exclusions are 
limited to the specific type of care at issue, we decline to revise the 
language of Sec.  92.207(b)(4). Section 92.207(b)(5)'s general 
prohibition on limitations or restrictions on coverage for gender 
transition or other gender-affirming care reaches the narrower 
exclusions or restrictions on gender-affirming care.
    We also decline to state that any denial of gender-affirming care 
will necessarily be discriminatory regardless of context or rationale. 
We will instead consider claims of discrimination raising non-
categorical denials on a case-by-case basis. Where OCR receives 
complaints about such exclusions or restrictions, we will investigate 
on a case-by-case basis whether they constitute prohibited 
discrimination under Sec.  92.207(b)(5) or any other applicable 
provision of the rule. Since section 1557 only prohibits discrimination 
and does not prescribe any specific standard of care, such denials will 
violate the final rule only where they entail discrimination on the 
basis of sex. As stated throughout this section, covered entities will 
have the opportunity to provide a legitimate, nondiscriminatory reason 
for such exclusions or restrictions.
    Comment: Some commenters proposed striking the phrase ``if such 
denial, limitation, or restriction results in discrimination on the 
basis of sex'' from Sec.  92.207(b)(5), stating that the elimination 
would make this provision clearer. Commenters viewed this phrase as 
confusing and redundant, as they stated that limiting or restricting 
coverage for services related to gender-affirming care is necessarily 
discriminatory. Another commenter noted the intersectionality of 
discrimination and stated that this language may be limiting.
    Response: For the reasons discussed above, we disagree that any 
restriction impacting gender-affirming care will necessarily constitute 
prohibited discrimination. For example, if an insurance plan places 
restrictions on coverage for gender-affirming surgeries that are no 
more stringent than the restrictions placed on any other type of 
surgical care, those restrictions will not violate the rule. As such, 
we decline to make the deletion proposed by these commenters.
    OCR agrees that the rule prohibits discrimination in the provision 
or coverage of gender-affirming care whether it is on the basis of sex 
or on the basis of race, color, national origin, age, or disability. 
That said, allegations about such discrimination are best brought under 
Sec.  92.207(b)(1), as Sec.  92.207(b)(5) is aimed at the types of 
denials or limitations on coverage that are based on a person's gender 
identity and are thus a form of sex discrimination.
    Comment: Commenters noted that even plans without categorical 
exclusions of gender-affirming care may adopt barriers to accessing 
such care, such as more stringent pre-approval processes. The 
commenters noted that these requirements could result in transgender 
people ultimately not receiving necessary care or having to invest 
significant time and resources to navigate the barriers. Some 
commenters additionally noted the high mental health toll on 
individuals facing discriminatory limitations on medically necessary 
care.
    Response: OCR appreciates the commenter's feedback and concern 
about the forms of discrimination transgender people encounter in 
seeking coverage for gender-affirming care but declines to revise Sec.  
92.207(b)(3) as suggested. Section 92.207(b)(5) prohibits limitations 
or restrictions on coverage for gender transition or other gender-
affirming care.
    Comment: Many commenters supported the provisions limiting issuers' 
ability to deny care based on a person's sex assigned at birth, gender 
identity, or gender otherwise recorded, noting that transgender, 
nonbinary, and intersex people can all face such discriminatory 
denials. Other commenters objected to these provisions, expressing 
concern that this would compel issuers to pay for care that was not 
medically necessary or appropriate for a given individual.
    Response: Section 92.207(c) makes clear that a nondiscriminatory 
determination that care is not medically necessary based on a patient's 
anatomy or medical need is permissible. For example, this final rule 
would not prohibit a covered entity from denying coverage for 
preventive health services for a transgender patient where such care is 
not medically necessary, such as a prostate exam for a transgender man 
who does not anatomically have a prostate. In contrast, the rule may 
prohibit a covered entity from denying coverage for medically necessary 
preventive care for a transgender patient.
    Comment: One provider group urged OCR to work with the Office of 
the National Coordinator for Health Information Technology (ONC) and 
electronic health record vendors to ensure that there are options for 
separately identifying a patient's gender identity and anatomy to 
reduce the risk of improper denials.
    Response: OCR appreciates the suggestion that discriminatory 
denials could be reduced if the records systems used by providers, 
issuers, and other covered entities provide better options

[[Page 37608]]

for recording gender identity and sex characteristics. While minimum 
standards for record systems are not within the scope of the rule, we 
are committed to working with ONC and other relevant stakeholders to 
explore solutions to this issue.
    Comment: Commenters noted that transgender people often have 
difficulty getting their health coverage to update their records to 
reflect their correct name and gender. Commenters noted that gender 
marker mismatches in health insurance records can result in denial of 
coverage for clinically appropriate care, and one commenter urged OCR 
to make clear that claims processing procedures that automatically deny 
coverage for care based on a perceived mismatch of sex or gender is a 
form of impermissible sex discrimination.
    Response: OCR appreciates commenters' concerns about coverage 
denials due to a sex mismatch in claims processing procedures, which 
can result in transgender patients being denied coverage for a 
medically necessary and clinically appropriate services. However, we 
decline to categorically state that sex mismatch denials are always 
discriminatory. Instead, OCR will consider and investigate complaints 
raising this issue on a case-by-case basis under Sec.  92.207(b)(3). 
While we refrain from categorically stating that initial sex mismatch 
or coding denials are prohibited under this rule, we caution that 
denials resulting in an undue delay or denial of services, such as 
repeated denials, could result in a finding of prohibited 
discrimination. For more information on OCR's view of this issue, 
please see the 2016 Rule preamble's discussion on computer systems with 
gender coding resulting in gender mismatches at 81 FR 31436.
    Comment: With respect to cases where coverage for comparable 
treatments is relevant to the discrimination analysis, some commenters 
urged OCR to clarify that the question of what is comparable can be 
construed broadly, rather than parsing minor differences in broadly 
similar types of care.
    Response: OCR declines to identify a bright line of how similar 
care must be to be considered comparable when such considerations are 
relevant to a discrimination claim, as there are many factors that may 
be relevant to this analysis, and our approach is case by case.
    Comment: Commenters who addressed the integration requirement in 
Sec.  92.207(b)(6) overwhelmingly supported the newly proposed 
provision, which clarifies the prohibition on having or implementing 
benefit designs that do not provide or administer health insurance 
coverage or other health-related coverage in the most integrated 
setting appropriate to the needs of qualified individuals with 
disabilities. Several noted the particular importance of this provision 
and access to community integration in light of the COVID-19 pandemic 
and the higher infection risks associated with congregate settings. A 
few commenters noted the role that discrimination on multiple bases may 
play with regard to community integration, highlighting the 
overrepresentation of people of color in institutional settings, and 
the relationship between access to effective communication and 
community integration. Numerous comments included examples of current 
practices that may violate the integration provision.
    Commenters agreed that this provision should apply to both benefit 
design and implementation of a benefit design, including: coverage, 
exclusions, and limitations of benefits; prescription drug formularies; 
cost sharing (including copays, coinsurance, and deductibles); 
utilization management practices; medical management standards 
(including medical necessity standards); provider network design; 
provider reimbursement; standards for provider admission to participate 
in a network; benefits and service administration contracted to third 
parties, such as pharmacy benefit managers; and quality measurement and 
incentive systems. Many commenters requested that OCR clarify that the 
convenience or potential cost-saving of administering treatments in 
institutional settings are not legitimate, nondiscriminatory reasons 
for not providing comparable benefits in less restrictive settings.
    Commenters suggested that providing coverage to qualified 
individuals with disabilities in the most integrated setting 
appropriate should not be done in a way that unnecessarily increases 
costs for all enrollees or compromises individual health benefits.
    Response: We appreciate support for the inclusion of this 
provision. OCR recognizes the importance of providing and administering 
health coverage in the most integrated setting appropriate to the needs 
of qualified individuals with disabilities; we also recognize that 
discrimination on multiple bases heightens barriers and are committed 
to addressing allegations of discrimination on all bases protected 
under section 1557. As discussed in the Proposed Rule, 87 FR 47873, 
this provision encompasses both the benefit design of the benefit being 
offered by a covered entity as well as the indirect mechanisms that 
affect the implementation of the benefit design within a covered 
entity's control, such as utilization management practices, provider 
reimbursement, contracting out to third-party contractors such as 
pharmacy benefit managers, and quality measurement and incentive 
systems. OCR is not prescriptive in the list of potential mechanisms 
that could result in prohibited discrimination through implementation 
of a benefit design because it is a case-by-case analysis depending on 
the facts of each situation.
    With respect to concerns about unnecessarily increasing costs to 
comply with this provision, OCR notes that institutional care is 
generally more expensive than community-based care and that increased 
cost alone is not necessarily a fundamental alteration.\200\ However, 
concerns related to cost can be raised through a fundamental 
alterations defense.\201\
---------------------------------------------------------------------------

    \200\ Fisher v. Okla. Health Care Auth., 335 F.3d 1175, 1183 
(10th Cir. 2003).
    \201\ Id. at 1182.
---------------------------------------------------------------------------

    Comment: Nearly all commenters who addressed this provision agreed 
with the 2022 NPRM preamble language stating that requiring prior 
authorization, step therapy, or other utilization management when 
individuals access treatment in the community but not in an 
institution, would constitute discrimination if the discrepancy results 
in unnecessary segregation or a serious risk of unnecessary 
segregation. Commenters noted that these practices place additional 
terms and conditions on the receipt of certain benefits in integrated 
settings that are not in place within segregated or institutional 
settings, and that they can often delay care and cause unnecessary 
institutionalization. For example, commenters asserted that people with 
physical and sensory disabilities, complex medical needs, and people 
with psychiatric and mental disabilities are often required to try less 
expensive and often unsuccessful medication (i.e., step therapy) before 
being able to access effective treatments in the community. If 
utilization management techniques are only required for community-based 
treatment and not for institutional care, commenters argued this may 
push individuals urgently in need of care into institutional setting so 
they can access treatment more quickly. In contrast, one commenter 
suggested that it may be clinically appropriate to distinguish between 
institutional settings and home and community-based settings (HCBS) 
through the use of medical management

[[Page 37609]]

tools like prior authorization and step therapy due to closer 
monitoring by medical professionals in institutional settings.
    Response: OCR shares commenters' concerns about the potential 
discrimination associated with the serious risk of 
institutionalization. The integration mandates of the ADA and section 
504 apply to people with disabilities who are at serious risk of 
segregation or institutionalization, not only to people with 
disabilities who are currently in institutions.\202\ For example, an 
individual could show sufficient risk of institutionalization such that 
it would constitute a violation of this provision if a covered entity's 
failure to provide community services or its cut to such services will 
likely cause a decline in health, safety, or welfare that result in the 
serious risk of institutionalization or segregation.
---------------------------------------------------------------------------

    \202\ See, e.g., Waskul v. Washtenaw Cnty. Cmty. Mental Health, 
979 F.3d 426, 460-62, (6th Cir. 2020) (``Plaintiffs may thus state a 
claim by sufficiently alleging that they are at serious risk of 
institutionalization''); Steimel v. Wernert, 823 F.3d 902, 911-12 
(7th Cir. 2016) (agreeing that the mandate applies to ``persons at 
serious risk of institutionalization or segregation''); Davis v. 
Shah, 821 F.3d 231, 262-64 (2d Cir. 2016) (``We thus hold that a 
plaintiff may state a valid claim . . . by demonstrating that the 
defendant's actions pose a serious risk of institutionalization for 
disabled persons.''); Pashby v. Delia, 709 F.3d 307, 322 (4th Cir. 
2013) (individuals state claims under the ADA and the Rehabilitation 
Act when ``they face a risk of institutionalization''); M.R. v. 
Dreyfus, 663 F.3d 1100, 1117-18 (9th Cir. 2011), amended by 697 F.3d 
706 (9th Cir. 2012) (plaintiff must ``show that the challenged state 
action creates a serious risk of institutionalization''); Fisher v. 
Okla. Health Care Auth., 335 F.3d 1175, 1181-82 (10th Cir. 2003) 
(plaintiffs who ``stand imperiled with segregation'' because of 
state action may state a claim under the ADA's integration mandate); 
but see U.S. v. Miss., No. 21-60772, 2023 WL 6138536, at *5-*9 (5th 
Cir. Sep. 20, 2023) (rejecting the United States' at-risk Olmstead 
claim).
---------------------------------------------------------------------------

    As articulated in the Proposed Rule, 87 FR 47873, step therapy and 
other utilization management practices that impose different standards 
on members or beneficiaries in the community than in institutional 
settings are discriminatory if the discrepancy results in unnecessary 
segregation or a serious risk of unnecessary segregation. Section 
1557's incorporation of section 504's integration provision through 
Sec.  92.101(b)(1) makes clear that serious risk of 
institutionalization is covered under section 1557 as well, given that 
the vast majority of courts have found section 504 and title II of the 
ADA prohibits actions, omissions, policies, and practices that place 
individuals at serious risk of unjustified isolation. Indeed, nearly 
every court of appeals to address the issue has held that the 
integration mandate of the ADA and section 504 apply not only to people 
with disabilities who are currently in institutions, but also to people 
with disabilities who are at serious risk of segregation or 
institutionalization.\203\ As noted in Fisher v. Oklahoma, the 
integration mandate's ``protections would be meaningless if plaintiffs 
were required to segregate themselves by entering an institution before 
they could challenge an allegedly discriminatory law or policy that 
threatens to force into segregated isolation.'' \204\ Likewise, section 
1557's integration mandate would ring hollow if individuals were 
required to show that they have already had to submit to 
institutionalization in order to assert their right to receive services 
in the most integrated setting appropriate to their needs.
---------------------------------------------------------------------------

    \203\ See supra footnote 202 (citing cases).
    \204\ 335 F.3d 1175, 1181 (10th Cir. 2003).
---------------------------------------------------------------------------

    Further, even if a serious risk of unnecessary institutionalization 
was not an actionable claim in and of itself, it would still be 
appropriate for courts to grant relief to those at serious risk in 
order to prevent the unnecessary institutionalization prohibited by 
law.\205\ For these reasons, the rule's integration provision 
explicitly prohibits benefit design that results in a serious risk of 
institutionalization.
---------------------------------------------------------------------------

    \205\ See, e.g., U.S. v. W.T. Grant Co., 345 U.S. 629, 633 
(1953) (explaining that ``[t]he purpose of an injunction is to 
prevent future violations'' and that such relief is appropriate 
where there is a ``cognizable danger of recurrent violation.'').
---------------------------------------------------------------------------

    Plans continue to be able to limit services, use utilization review 
standards, and employ other limitations to manage costs as long as they 
are not discriminatory in doing so.
    OCR has revised the regulation text to clarify that the integration 
requirement under section 1557 extends to practices that result in the 
serious risk of institutionalization or segregation. We recognize that 
the question of what constitutes ``serious risk'' is a fact-based 
inquiry, which is why the Federal courts to have considered the 
question have provided only general guidance on determining risk rather 
than an exhaustive test.\206\
---------------------------------------------------------------------------

    \206\ For example, in Davis v. Shah, 821 F.3d 231, 262-63 (2d 
Cir. 2016), the court quoted DOJ, noting that ``a plaintiff `need 
not wait until the harm of institutionalization or segregation 
occurs or is imminent' '' to bring a claim under the ADA. A 
plaintiff establishes a ``sufficient risk of institutionalization to 
make out an Olmstead violation if a public entity's failure to 
provide community services . . . will likely cause a decline in 
health, safety, or welfare that would lead to the individual's 
eventual placement in an institution.'' See also Waskul v. Washtenaw 
Cnty. Cmty. Mental Health, 979 F.3d 426, 462 (6th Cir. 2020) 
(finding ``declines in health, safety, or welfare'' as to sufficient 
to show plaintiffs were at serious risk of institutionalization).
---------------------------------------------------------------------------

    Comment: Several commenters strongly disagreed with the 2022 NPRM 
preamble language that stated that a State Medicaid program would 
generally not be required to provide a new benefit because that would 
fundamentally alter the nature of the program. Commenters noted that a 
State Medicaid program or other covered entity may have to expand its 
HCBS waiver programs or modify eligibility for particular services 
where necessary to satisfy the integration provision, and that there 
are many situations in which a State program has been required to 
create a ``new'' community-based benefit, where that benefit was 
previously only available in institutional settings. For example, 
commenters stated that a covered entity that provides for residential 
treatment for certain substance use disorder conditions and does not 
provide coverage of such services in appropriate community-based 
settings may need to create a ``new benefit'' by offering an existing 
institutional benefit in the community.
    Response: After considering these comments, we clarify here that 
while a State Medicaid program is not required to create ``new'' 
programs to assist people with disabilities, nor are states required to 
provide a particular standard of care or level of benefits, covered 
entities must nevertheless adhere to section 1557's disability 
nondiscrimination requirements--including the integration requirement--
with regard to the services they in fact provide. When a covered entity 
chooses to provide a service, it must do so in a nondiscriminatory 
fashion by ensuring access to that service in the most integrated 
setting appropriate to the needs of the qualified individual.\207\ 
States may be required to offer services in an integrated setting that 
they have only been offering in segregated settings; that is not 
offering a ``new service,'' but instead is ensuring the service is 
offered in integrated settings and not just in segregated 
settings.\208\
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    \207\ See Olmstead, 527 U.S. 581, 603 (1999); see also 
Radaszewski v. Maram, 383 F.3d 599, 609 (7th Cir. 2004) (citing 
Olmstead, 527 U.S. at 603 n. 14, for the principle ``that States 
must adhere to the ADA's nondiscrimination requirement with regard 
to the services they in fact provide'') (``While `a State is not 
obligated to create new services,' it `may violate Title II when it 
refuses to provide an existing benefit to a disabled person that 
would enable that individual to live in a more community-integrated 
setting.''').
    \208\ See U.S. Dep't of Justice, Civil Rts. Div., Statement of 
the Dep't of Justice on Enforcement of the Integration Mandate of 
Title II of the Americans with Disabilities Act and Olmstead v. 
L.C., Question 8 (February 28, 2020), https://www.ada.gov/olmstead/q&a_olmstead.htm (stating that ``(p)ublic entities cannot avoid 
their obligations under the ADA and Olmstead by characterizing as a 
``new service'' services that they currently offer only in 
institutional settings.''); see also Townsend v. Quasim, 328 F.3d 
511, 517 (9th Cir. 2003) (``Here, the precise issue is not whether 
the state must provide the long term care services sought by Mr. 
Townsend and the class members--the state is already providing these 
services--but in what location these services will be provided.'').

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[[Page 37610]]

    OCR clarifies that a program providing community-based services 
that are already available in institutional settings is not a new 
program for purposes of evaluating a fundamental alteration 
defense.\209\ In addition, states may be required to offer services in 
an integrated setting that have only been offered in a segregated 
setting. Providing services beyond what a State currently covers under 
its Medicaid program may not be a fundamental alteration under Sec.  
92.205 (Requirement to make reasonable modifications), and existing 
nondiscrimination law, including section 504 and the ADA,\210\ may 
require states to provide those services, under certain circumstances. 
In addition, to the extent that a benefit, including an optional 
benefit, is already provided in institutions as part of the State's 
program, the same or a substantially similar benefit must be offered in 
the community in a manner that does not incentivize institutional 
services over community services.
---------------------------------------------------------------------------

    \209\ See Townsend, 328 F.3d at 517 (``[c]haracterizing 
community-based provision of services as a new program of services 
not currently provided by the state fails to account for the fact 
that the state is already providing those very same services. If 
services were to constitute distinct programs based solely on the 
location in which they were provided, Olmstead and the integration 
regulation would be effectively gutted.'').
    \210\ While this final rule periodically references the ADA and 
section 504, the requirements under this rule are under section 
1557, a separate legal authority. Accordingly, the integration 
requirements, like other requirements under this section 1557 rule, 
do not limit or impact the interpretation of integration 
requirements under the ADA and section 504.
---------------------------------------------------------------------------

    Comment: OCR received many comments in response to our request for 
comment on the application of the integration provision to State 
Medicaid programs. A number of comments related to Medicaid program 
designs required by title XIX of the Social Security Act. One commenter 
recommended that any action by a State Medicaid authority to reduce the 
existing scope of Medicaid-funded home and community-based long term 
services and supports, or to more strictly limit eligibility for them, 
that would have the effect of forcing people with disabilities who 
currently do, or could, live in their own homes and participate in 
unrestricted community activities into segregated, congregate, and/or 
institutional residential or day settings, or to cease their current 
level of community participation, on the basis of any general 
categorization of disability would be discriminatory under this 
provision.
    Response: We appreciate the many comments highlighting potential 
issues related to community integration and State Medicaid programs. 
This rule does not impact the ability of states to target benefits 
under section 1915(c), section 1915(i), or section 1937 of the Social 
Security Act, consistent with Medicaid law. At the same time, the fact 
that a State chooses to use a Medicaid authority to target a particular 
disability population does not relieve a State of its obligations 
towards other populations. We will continue to work with our partners 
in CMS to ensure the robust provision of services in a 
nondiscriminatory manner to the maximum extent possible. We remind 
covered entities that obligations under the Medicaid statute are 
distinct from obligations under section 1557, and compliance with 
Medicaid requirements does not per se constitute compliance with 
section 1557.
    Comment: A significant number of commenters raised concerns with 
``use-in-the-home'' policies, where an insurance issuer will cover the 
provision of a benefit or service solely for use ``in the home.'' For 
example, commenters discussed that a covered entity might offer 
supplemental oxygen equipment for use in the home but decline to 
provide sufficient oxygen or equipment for an individual to access the 
broader community. Similarly, commenters noted that issuers might 
decline to cover medically necessary wheelchairs with functions that an 
individual needs to access the broader community outside their home. 
Commenters also provided examples of other kinds of medical diagnostic 
equipment, durable medical equipment, and home-use devices that are 
often not covered, but which would replace services provided in an 
institution and enable individuals to receive care in their home and 
community.
    Commenters expressed concern that many State Medicaid programs, 
delegated managed care companies, and employer-sponsored private health 
plans have adopted the Medicare Mobility Assistive Equipment Coverage 
Policy \211\ (a policy designed specifically to apply in the context of 
Medicare Part B) as their policy, despite what commenters see as the 
statutory differences between Medicare Part B and other authorities. 
Commenters contended that the unnecessary and unmandated adoption of 
such a policy in all programs unnecessarily restricts benefits to a low 
bar, denying people the ability to live in the most integrated setting 
possible.
---------------------------------------------------------------------------

    \211\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., National Coverage Determination, Mobility Assistive 
Equipment (MAE) (2005), https://www.cms.gov/medicare-coverage-database/view/ncd.aspx?NCDId=219.
---------------------------------------------------------------------------

    Response: We appreciate the concerns raised by commenters. Each 
covered entity should review any legal authority governing the coverage 
they may provide to ensure that they are not interpreting it in a 
manner that results in discrimination. For example, Medicaid programs 
that impose homebound or ``in-the-home'' criteria that are not 
statutorily required under Federal law may be unnecessarily restricting 
services in the community in violation of civil rights laws. Where an 
in-the-home restriction is included in a statute, covered entities may 
not automatically deny coverage for any good or service that may also 
have use outside of the home, but must assess each claim to determine 
whether the denial will violate the most integrated setting 
requirement.
    Comment: Many commenters expressed the need for Sec.  92.207(b)(6), 
due to states increasingly turning to managed care plans to deliver 
Medicaid benefits. These commenters expressed concern that large 
issuers that administer a range of private employer plans and 
individual plans, as well as public Medicare and Medicaid plans, could 
employ uniform coverage policies across their plans that do not 
adequately support community integration. Commenters additionally noted 
that that Medicaid agencies should monitor whether Medicaid Managed 
Care Organizations (MCOs) are appropriately authorizing services in the 
community and that under current law states contracting with MCOs 
cannot escape liability when MCOs discriminate against people with 
disabilities.
    Response: We appreciate the concerns raised by commenters. We 
recognize the increasing reliance on alternative payment models for the 
delivery or management of services to individuals with disabilities. 
The shift towards managed care in State Medicaid programs and other 
changes, such as quality incentives, quality assurance activities, and 
risk-sharing arrangements, requires addressing unnecessary segregation 
in these emerging models in this rule.
    As we noted in the Proposed Rule, 87 FR 47873, covered entities 
designing contracts with MCOs, pharmacy benefit managers, or other 
third-party entities taking on financial risk for the delivery of 
health services should carefully scrutinize their capitation,

[[Page 37611]]

reimbursement, quality measurement, and incentive structures to ensure 
that they do not result in the unjustified segregation of individuals 
with disabilities or place individuals with disabilities at serious 
risk of institutionalization or segregation. When responsibility for 
services is shared across multiple entities, for example, under a 
managed care contract, both the State Medicaid agency and the 
contracted entity have obligations under this provision if they are 
both recipients of Federal financial assistance.
    Comment: Many commenters discussed challenges related to mental 
health services, noting that the lack of available and funded community 
alternatives to institutional mental health care will continue to 
result in the institutionalization of individuals with serious mental 
illness, whether in hospitals, inpatient psychiatric facilities, 
prisons, or other secure facilities.
    Many commenters voiced concern related to discharge planning, as 
people requiring intensive mental health services are often referred 
only to institutional or otherwise congregate care options, rather than 
comparably intensive services in community-based settings. Commenters 
recommended that OCR clarify that this can constitute a violation of 
the integration provision if it forces people with psychiatric 
disabilities to enter segregated settings in order to receive access to 
adequate services.
    Other commenters discussed the disparity in access to community-
based care for children who need mental health care.
    Response: OCR appreciates the significant concerns related to the 
availability of community-based behavioral health services, 
particularly services to address youth mental health. With respect to 
discharge planning, a hospital or acute care provider that routinely 
discharges individuals with disabilities, including those with serious 
mental illness, to nursing homes, psychiatric residential treatment 
facilities, or other segregated care settings due to discharge planning 
procedures that do not assess for home-based support services or refer 
individuals to community-based providers may violate this provision. 
Covered entities are prohibited from implementing planning, service 
system design, and service implementation practices that result in the 
serious risk of institutionalization or segregation.
    Comment: Several commenters provided insight into the relationship 
between community integration and reimbursement rates necessary to 
sustain a direct care workforce. Commenters explained that individuals 
receiving care in the community often fail to receive all of the hours 
of care for which they are approved due to a lack of provider capacity 
to fully staff the approved hours. Commenters noted that nurse's aides 
and other individuals who provide assistance in institutional settings 
are often paid at a higher rate than home health aides and other direct 
care professionals, resulting in an imbalanced direct care workforce. 
Commenters emphasized the importance of rate setting to incentivize 
HCBS.
    Response: Reimbursement rates and network adequacy both constitute 
methods of program administration. As such, these are factors that OCR 
would consider as reimbursement practices or methods of administration 
related to this provision.
    Comment: Commenters suggested additional guidance clarifying 
implementation of this provision, including incorporating DOJ's 
guidance on enforcement of the integration requirement under title II 
of the ADA describing how to provide the most integrated setting 
appropriate for an individual or group of individuals; \212\ addressing 
the remedies available for violations of the integration provision; and 
explaining how OCR will undertake a fundamental alteration analysis. 
One commenter recommended incorporating the fundamental alteration 
defense into regulatory text. Commenters underscored the importance of 
setting a high bar for a fundamental alteration, noting that programs 
must alter an essential aspect of the health program or activity. Other 
commenters urged OCR to clarify how the fundamental alteration analysis 
applies to the integration provision, including whether and how OCR 
will incorporate DOJ guidance and case law related to the ADA's 
fundamental alteration defense for ADA title II entities. Commenters 
also requested clarification on whether covered entities will be 
required to establish an Olmstead integration plan \213\ to raise the 
fundamental alteration defense, and if so, guidance related to that 
requirement.
---------------------------------------------------------------------------

    \212\ U.S. Dep't of Justice, Civil Rts. Div., Statement of the 
Dep't of Justice on Enforcement of the Integration Mandate of Title 
II of the Americans with Disabilities Act and Olmstead v. L.C. (June 
22, 2011), https://www.ada.gov/olmstead/q&a_olmstead.htm.
    \213\ Under the ADA, an Olmstead plan is a public entity's plan 
for implementing its obligation to provide individuals with 
disabilities opportunities to live, work, and be served in 
integrated settings. U.S. Dep't of Justice, Civil Rts. Div., 
Statement of the Dep't of Justice on Enforcement of the Integration 
Mandate of Title II of the Americans with Disabilities Act and 
Olmstead v. L.C. (June 22, 2011), https://www.ada.gov/olmstead/q&a_olmstead.htm.
---------------------------------------------------------------------------

    Commenters also asked OCR to explain in future guidance how covered 
entities, including Medicaid programs, must coordinate community-based 
primary care and specialty mental health care and offer case management 
to avoid discrimination on the basis of disability and to avoid placing 
individuals with mental disabilities at serious risk of 
institutionalization.
    Commenters further suggested guidance to covered entities 
explaining the specific HCBS that are essential to achieving compliance 
with the integration requirement, including as part of EHB. Commenters 
suggested that it would be discriminatory if EHB plans set higher 
reimbursement rates for a service or item for individuals in segregated 
settings rather than community-based settings; if rehabilitation 
services for physical conditions are covered, but not psychiatric 
rehabilitation services; and if a particular benefit (such as personal 
care services) is offered in greater amounts to individuals in 
segregated settings by virtue of the plan benefit design.
    Finally, commenters encouraged OCR to develop joint guidance with 
DOJ on section 1557, section 504, and titles II, III, and IV of the ADA 
to ensure the rights of people with disabilities to access community 
integration in health care settings.
    Response: We appreciate the comments requesting clarification 
through sub-regulatory guidance. We will consider future guidance after 
this rule has been finalized and are committed to our continued 
partnership with DOJ in developing shared guidance on civil rights 
requirements. The availability of the fundamental alteration defense is 
clear as drafted and so we decline to specifically incorporate this 
recommendation into regulation text. In this final rule, we clarify 
that a program is not required to provide coverage for a service in the 
most integrated setting appropriate to an individual's needs if it 
would fundamentally alter the program to do so.
    Comment: Commenters, primarily representatives of the insurance 
industry, supported proposed Sec.  92.207(c) that specified nothing in 
this section requires coverage of any health service where the covered 
entity has a legitimate, nondiscriminatory reason for determining that 
such health service fails to meet applicable coverage

[[Page 37612]]

requirements, such as medical necessity requirements, in an individual 
case. Commenters appreciated that OCR acknowledged that a covered 
entity's legitimate, nondiscriminatory reason for its actions may serve 
as a defense under this section.
    Some commenters requested clarification that use of the phrase 
``legitimate, nondiscriminatory reason'' not be construed in any way to 
limit the method of proof for any section 1557 claim to the McDonnell 
Douglas burden-shifting framework; that this method cannot be used to 
defend an express sex classification that causes injury; that the 
familiar but-for causation test applies to establishing a violation of 
section 1557; and that the McDonnell Douglas burden-shifting framework 
and legitimate nondiscriminatory reason framework apply to 
circumstantial evidence cases but not where there is direct evidence of 
discrimination.
    Response: OCR appreciates commenters' support of this provision. As 
discussed throughout this section and in the Proposed Rule, in 
instances where there is not a facially discriminatory policy and OCR 
is investigating whether a particular action or practice is 
discriminatory under this rule, covered entities have the opportunity 
to defend the challenged action or practice by providing a legitimate, 
nondiscriminatory reason for its actions that is not pretext for 
discrimination. OCR will then evaluate whether the reason given by the 
covered entity is a pretext for prohibited discrimination. When 
considering whether a proffered reason is pretextual, OCR will 
consider, among other things, whether a denial of a health service is 
based on medical necessity standards or other reasonable medical 
management techniques that are not discriminatory, as discussed in more 
detail below.
    To provide additional clarity about OCR's analysis when evaluating 
whether a covered entity's legitimate, nondiscriminatory reason is 
pretextual, OCR is revising Sec.  92.207(c) to state that a covered 
entity's denial or limitation of a health service must not be based on 
unlawful animus or bias, or constitute a pretext for discrimination. 
This modification is consistent with the revised language in Sec.  
92.206(c). Under either section, in instances where there is no 
evidence of a facially discriminatory policy, covered entities may 
assert a legitimate, nondiscriminatory basis for actions that could 
otherwise give rise to the inference of discrimination. Consistent with 
general principles of civil rights law, OCR will consider such asserted 
bases but may also investigate to determine whether such asserted bases 
are pretextual and whether there is evidence that the challenged action 
was taken because of unlawful animus, bias, or other discriminatory 
factors.
    In evaluating claims of discrimination, OCR relies on general 
nondiscrimination principles and longstanding civil rights case law. 
Such principles include, but are not limited to, the multi-factor test 
articulated in Arlington Heights and the McDonnell Douglas burden-
shifting framework, which were discussed in detail in the Proposed Rule 
at 87 FR 47865. Arlington Heights sets forth a method of proof that 
utilizes different types of evidence that collectively may demonstrate 
that a covered entity acted, at least in part, because of a protected 
basis. The McDonnell Douglas burden-shifting framework is an 
inferential method of proof used to show that a covered entity treated 
similarly situated individuals differently because of a protected 
basis. Under McDonnell Douglas, where non-facial evidence of 
discrimination exists, a covered entity must articulate a legitimate, 
nondiscriminatory reason for its actions. The entity's legitimate, 
nondiscriminatory reason may refute the evidence of discrimination, 
unless it can be established that this reason is a mere pretext for 
prohibited discrimination. In response to the commenters' concerns 
about how Sec.  92.207(c) may be interpreted inconsistently with the 
principles set forth in McDonnell Douglas and other civil rights 
principles, please see our response to the same comments under Sec.  
92.206 in which we affirm commenters' interpretations are correct--
McDonnell Douglas' burden-shifting framework and legitimate 
nondiscriminatory reason framework apply to circumstantial evidence 
cases but not in cases where there is direct evidence of discrimination 
based on a facially discriminatory policy.
    Comment: Some commenters appreciated OCR clarifying that medical 
management techniques based on clinical evidence are permitted, 
including the use of reasonable medical necessity and utilization 
management techniques based on clinical standards and evidence-based 
guidelines, when applied in a neutral manner. Commenters noted that 
medical management tools provide an important role in promoting quality 
care and reducing health care costs.
    Other commenters raised concerns about medical necessity criteria 
and other medical management tools, noting that such tools may limit 
access to needed services and treatment. Commenters noted that 
discriminatory decisions often occur under the guise of medical 
necessity determinations. Some commenters argued that medical 
management practices such as prior authorization, step therapy, and 
durational or quantity limits are inherently discriminatory and 
inconsistent with patient health and safety. Many commenters strongly 
supported OCR clarifying that excessive use or administration of 
benefit utilization management tools that target particular 
disabilities could violate section 1557. Commenters asked OCR to 
expressly note the limitation on the use of utilization management 
tools in the text of the regulation.
    Commenters asked OCR for examples of excessive medical management 
and suggested the following examples: requiring step therapy for new 
enrollees who are already on a working course of treatment; 
transferring management of particular medicines to niche vendors that 
apply more extensive medical management through specialty carve-out 
programs; requiring the use of off-label medications within step 
therapy; and imposing categorical prior authorization and step therapy 
requirements on most or all drugs required to treat a particular 
disease. Commenters noted that issuers apply such medical management 
techniques to discourage individuals with high-cost needs from 
enrolling in their plans. A commenter cited evidence that plans have 
restricted access to lower-cost brand drugs and generics when demand 
for those drugs attracts patients who have overall high health 
costs.\214\ Other commenters noted that information about treatment 
limitations can be difficult to find for enrollees and cited evidence 
of issuers building arbitrary coverage denials into their business 
plans.\215\ Commenters cited a study that found that more than half of 
step therapy policies developed by commercial health plans were more

[[Page 37613]]

restrictive than recommended clinical guidelines.\216\
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    \214\ Michael Geruso et al., Screening in Contract Design: 
Evidence from the ACA Health Insurance Exchanges, 11 a.m. Econ. J.: 
Econ. Pol. 2, 64-107 (2019), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8130799/.
    \215\ Karen Pollitz et al., Claims Denials and Appeals in ACA 
Marketplace Plans in 2021, Kaiser Family Found. (2022), https://www.kff.org/private-insurance/issue-brief/claims-denials-and-appeals-in-aca-marketplace-plans/ (finding nearly 17 percent of in-
network claims in non-group qualified health plans were denied in 
2021; insurer denial rates varied widely around this average, 
ranging from 2 to 49 percent; about 14 percent were denied because 
the claim was for an excluded service, 8 percent were due to lack of 
preauthorization or referral, 2 percent were based on medical 
necessity, and 77 percent were classified as ``all other reasons'').
    \216\ Kelly L. Lenahan et al., Variation in Use and Content of 
Prescription Drug Step Therapy Protocols, Within and Across Health 
Plans, 40 Health Affairs 11, 1749-57 (2021), https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2021.00822?journalCode=hlthaff (finding that plans applied 
step therapy in 38.9 percent of drug coverage policies, with varying 
frequency across plans (20.6-57.5 percent); 34.0 percent were 
consistent with corresponding clinical guidelines, 55.6 percent were 
more stringent, and 6.1 percent were less stringent).
---------------------------------------------------------------------------

    Some commenters requested that OCR revise the text of Sec.  
92.207(c) to state that, in addition to medical necessity requirements, 
covered entities may employ reasonable medical management techniques.
    Response: OCR appreciates the variety of comments and 
recommendations put forth by commenters related to the rule's coverage 
of medical management techniques, including medical necessity standards 
and utilization management techniques.
    OCR agrees that revising the regulatory text to reference 
reasonable medical management techniques would provide clarity and 
would be consistent with other provisions in the ACA and the Proposed 
Rule. Therefore, OCR is revising Sec.  92.207(c) to state that 
applicable coverage requirements include reasonable medical management 
techniques, including medical necessity.
    Further, as stated in the Proposed Rule, covered entities are not 
prohibited from employing reasonable medical management techniques as 
long as they are not discriminatory and are not otherwise prohibited 
under other applicable Federal and State law. 87 FR 47873-74. As just 
one example, covered entities participating in the Medicaid program 
under title XIX of the Social Security Act are not prohibited from 
implementing nondiscriminatory utilization management techniques, such 
as prior authorization.\217\
---------------------------------------------------------------------------

    \217\ See, e.g., 42 U.S.C. 1396r-8(d).
---------------------------------------------------------------------------

    Under Sec.  92.207(c), an issuer may assert a legitimate, 
nondiscriminatory reason for its denial or limitation of coverage of a 
health service that asserts the denial was based on medical necessity 
standards--or any other medical management technique. When assessing 
whether the challenged action was based on prohibited discrimination 
rather than on nondiscriminatory medical necessity standards, OCR will 
review a medical necessity determination only to make sure that it is a 
bona fide medical judgment, not conduct a review of the medical 
judgment underlying the medical necessity determination, but rather 
will assess whether the rationale for the denial was based on 
impermissible discriminatory considerations. In its review, OCR may 
require a covered entity to provide the following information: its 
medical necessity standards or guidelines; the clinical, evidence-based 
criteria or guidelines \218\ relied upon to make the medical necessity 
determination; and the medical substantiation for the medical necessity 
determination. As discussed previously, OCR will evaluate a covered 
entity's assertion that its actions were based on legitimate, 
nondiscriminatory reasons to determine if it is pretextual. Medical 
necessity determinations that are not based upon general medical 
judgments or based on clinical, evidence-based criteria or guidelines 
may be considered evidence of pretext for discrimination.
---------------------------------------------------------------------------

    \218\ See also Patient Protection and Affordable Care Act; HHS 
Notice of Benefit and Payment Parameters for 2023, 87 FR 27208, 
27296-300 (May 6, 2022) (discussing newly promulgated 45 CFR 
156.125(a), which states ``[a] non-discriminatory benefit design 
that provides [EHB] is one that is clinically-based'').
---------------------------------------------------------------------------

    Similarly, as noted in the Proposed Rule, 87 FR 47872, we affirm 
that covered entities are not prohibited from using other reasonable 
medical management techniques, such as utilization management tools, 
when applied in neutral, nondiscriminatory manner and not otherwise 
prohibited under other applicable Federal and State law. Utilization 
management techniques include prior authorization,\219\ step therapy 
(or ``fail-first''),\220\ and durational or quantity limits.\221\
---------------------------------------------------------------------------

    \219\ Medicare defines ``prior authorization'' as ``the process 
through which a request for provisional affirmation of coverage is 
submitted to CMS or its contractors for review before the service is 
provided to the beneficiary and before the claim is submitted for 
processing.'' 42 CFR 419.81 (Medicare definition of ``prior 
authorization'' for hospital outpatient department services). See 
also Ctrs. for Medicare & Medicaid Servs., Prior Authorization 
Process for Certain Hospital Outpatient Department (OPD) Services 
Frequently Asked Questions (FAQs), Q1 (Dec. 27, 2021), https://www.cms.gov/files/document/opd-frequently-asked-questions.pdf.
    \220\ Medicare defines ``step therapy'' for the Medicare 
Advantage Program as a ``utilization management policy for coverage 
of drugs that begins medication for a medical condition with the 
most preferred or cost effective drug therapy and progresses to 
other drug therapies if medically necessary.'' 42 CFR 422.2.
    \221\ Durational or quantity limits place limits on the 
frequency or number of benefits to be provided, such as limiting 
therapy visits to once per week or limiting prescription drug 
coverage to a 30-day supply of a medication.
---------------------------------------------------------------------------

    OCR shares commenters' concerns about potentially discriminatory 
practices related to medical management techniques and the negative 
impacts of excessive utilization management. As such, when relying on 
medical necessity requirements and other medical management techniques 
to deny coverage for a health service, covered entities must ensure 
that such tools are developed and applied in a neutral, 
nondiscriminatory manner. OCR would have concerns about guidelines that 
establish more restrictive requirements for certain diseases or 
conditions without a nondiscriminatory justification. In addition, OCR 
expects that limitations within such guidelines should be applied 
consistently with clinical standards within each patient population 
disease state, condition level, and diagnostic category to ensure equal 
clinical treatment across protected bases. That is, all patients 
diagnosed with a particular disease state must receive the same 
treatment that is deemed clinically appropriate, regardless of their 
race, color, national origin, sex, age, or disability.
    We affirm that excessive use or administration of utilization 
management practices that target a particular condition that could be 
considered a disability or other prohibited basis under section 1557 
could be discriminatory under this rule. OCR declines to state in 
preamble or regulatory text that specific practices are per se 
discriminatory under section 1557. As discussed throughout this 
section, OCR must conduct a fact-specific inquiry into allegations of 
discriminatory actions and consider a covered entity's proffered reason 
for the challenged action.
    Comment: OCR received a number of comments discussing costs as a 
legitimate, nondiscriminatory reason for benefit designs under Sec.  
92.207(c). Commenters supported the rule allowing clinical evidence to 
support a benefit design and requested that OCR allow covered entities 
to use extraordinary costs as justification for certain benefit 
designs. Commenters stated that covered entities use utilization 
management controls, such as drug tiering, as part of their benefit 
design to keep coverage affordable. Commenters noted concerns that 
high-cost drugs or other services could lead to health plans becoming 
insolvent if they are unable to apply utilization management controls 
where all treatments for a particular condition are high cost, 
particularly when they are expensive new drugs or gene therapies. 
Commenters argued that issuers and plans must retain some flexibility 
in their approach to covering and paying for high-cost drugs and 
services. Commenters expressed concern that Sec.  92.207 would prohibit 
covered entities from having utilization management controls on all or 
most drugs or services

[[Page 37614]]

that treat a particular condition or disease, regardless of their cost, 
and asked OCR to affirm that placing all treatments for a certain 
disease or condition in one tier may not in fact be discriminatory by 
default, but rather an appropriate benefit design due to the high cost 
of those particular items or services.
    Conversely, other commenters asked OCR to clarify that covered 
entities cannot justify benefit designs that disfavor coverage for 
medically necessary services based on cost savings. Commenters noted 
that as costs of medications and therapies have increased, covered 
entities have significantly increased the use of utilization 
management, including adding arbitrary prior authorization processes 
not based in clinical evidence for new cancer therapies. They added 
that rare disease patients face the additional challenge of having no 
or few treatment alternatives if a preferred medication or therapy is 
not covered.
    Response: OCR reiterates that Sec.  92.207 does not prohibit a 
covered entity from engaging in reasonable utilization management 
techniques applied in a neutral, nondiscriminatory manner and that are 
not otherwise prohibited under other applicable Federal and State law. 
As noted above, excessive use or administration of utilization 
management tools that target a particular condition that could be 
considered a disability or other prohibited basis could violate section 
1557. Where there is an alleged discriminatory practice or action that 
is not based on a facially discriminatory policy, Sec.  92.207(c) 
provides that the covered entity has the opportunity to provide a 
legitimate, nondiscriminatory reason for the practice. Covered entities 
are not restricted in what information they elect to provide to OCR as 
part of their justification for the challenged practice or action. OCR 
will carefully review a covered entity's proffered reason to ensure it 
is not pretext for discrimination.
    OCR discussed previously that determinations on whether a 
particular benefit design feature is discriminatory, such as 
utilization management or drug tiering, will be made on a case-by-case 
basis. Accordingly, OCR declines to specify whether certain benefit 
design practices are per se discriminatory.
    Comment: One organization raised concerns that OCR is asserting de 
facto authority over the relationship between health insurance and 
medical care, and that OCR is asserting that it has authority under 
section 1557 to regulate the practice of medicine and the structure of 
health insurance coverage according to its own determination of what is 
``appropriate'' and ``nondiscriminatory,'' along with the authority to 
definitively determine what is, or is not, the current standard of 
medical care. The commenter further states that OCR may in the future 
assert and exercise similar claims of authority with respect to other 
medical practices, standards of care, or health insurance coverages.
    Response: As previously discussed throughout this preamble, section 
1557 was intended to prohibit discrimination in health insurance 
coverage and other health-related coverage, as the statute's plaint 
text makes apparent. Congress expressly granted the Secretary the 
authority to promulgate regulations to implement section 1557. 42 
U.S.C. 18116(c). Therefore, OCR is acting within its statutory 
authority in promulgating this final rule to regulate health insurance 
coverage or other health-related coverage provided or administered by a 
recipient health insurance issuer or other covered entity. OCR 
disagrees with the commenter that this rule establishes a standard of 
medical care, or requires certain health insurance coverages. As 
specified in the preceding discussion, when assessing whether a 
challenged action was based on prohibited discrimination rather than on 
nondiscriminatory medical necessity standards, OCR will not conduct a 
general review of the medical judgment underlying the medical necessity 
determination, but rather will assess whether there is facial or other 
direct evidence of discriminatory intent or if a proffered rationale 
for the denial was pretext for discrimination. Further, this final rule 
does not require coverage of a particular health service; rather, it 
requires that the coverage being offered must be provided in a neutral 
and nondiscriminatory manner.
    Comment: Commenters stated that issuers should provide transparent 
information on coverage details, utilization management practices, 
denial rates, and reasons for denials. Specifically, a commenter 
requested that this section be strengthened by implementing a 
requirement for health plans to disclose medical necessity 
determinations when care or coverage is denied based on medical 
necessity to individual enrollees. The commenter further suggested that 
OCR adopt the approach in the MHPAEA final rule, requiring disclosure 
of medical necessity criteria to potential beneficiaries or enrollees 
and the reasons behind denials of coverage or reimbursement. Commenters 
emphasized that disclosure would help providers and consumers to 
identify and challenge discriminatory denials of medically necessary 
care, which can be difficult to do when data regarding the coverage 
they need either does not exist or the issuer holds the data on details 
of coverage, denial rates, and reasons for denial.
    Response: OCR agrees with commenters that transparency about 
medical management policies and coverage determinations and denials is 
useful information for the public, and we encourage issuers to disclose 
such information to all enrollees. OCR considered requiring issuers to 
affirmatively disclose certain plan information to the public, but we 
decline to do so at this time. We have determined that placing a 
transparency requirement on health insurance issuers covered under 
section 1557 would not be helpful on issuers if required in every 
situation, and because the scope and application of section 1557 is 
broader than, and imposes different requirements from, MHPAEA. We 
stress that OCR has the authority to request and receive information 
from a covered entity on the details of coverage, medical management 
policies, denial rates, and reasons for denials, among other things, 
when necessary to determine compliance with section 1557.\222\ In 
addition, we note that appeals processes that subject individuals 
protected by section 1557 to excessive administrative burdens in 
accessing coverage benefits that other enrollees are not required to 
navigate when accessing coverage may be discriminatory under section 
1557.
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    \222\ 45 CFR 92.303 (section 1557); 80.6 (title VI); 84.61 
(section 504, incorporating title VI's Sec.  80.6); 86.71 (title IX, 
incorporating title VI's Sec.  80.6); 91.34 (Age Act).
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    Comment: OCR received many comments on the use of value assessment 
methods in benefit design and pricing and coverage decisions, and their 
impacts on treatments for people with disabilities and older adults, 
particularly in access to prescription drugs and benefit design. 
Commenters suggested that some payers use these assessment methods to 
steer patients away from newer or more innovative treatments to less 
effective options. Commenters on this issue appreciated OCR's 
recognition in the Proposed Rule that these methods can have 
discriminatory impacts, though commenters did not provide uniform input 
about how to address these impacts.
    Several commenters called for increased oversight of value 
assessment methods by OCR, and some called on OCR to ban the use of the 
quality-

[[Page 37615]]

adjusted life year (QALY) framework and similar methods. Commenters 
supporting a ban on the use of QALYs stated that these methods are 
inherently discriminatory because they assign a lesser numerical value 
to extending the lives of people with disabilities and older adults 
compared to people without disabilities or younger persons, especially 
when applied to benefit design or access to prescription drugs.\223\
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    \223\ These concerns were also highlighted in testimony at a 
recent Congressional hearing on proposed legislation to ban the use 
of QALYs in all Federal health programs. See Lives Worth Living: 
Addressing the Fentanyl Crisis, Protecting Critical Lifelines, and 
Combatting Discrimination Against Those with Disabilities: Hearing 
on H.R. 467, H.R. 498, H.R. 501, and H.R. 485 Before the Subcomm. on 
Health of the H. Comm. on Energy & Com., 118th Cong. (2023) 
(statement of Kandi Pickard, President & CEO, Nat'l Down Syndrome 
Society), https://d1dth6e84htgma.cloudfront.net/Witness_Testimony_Pickard_HE_02_01_2023_065c903370.pdf?updated_at=2023-01-30T21:38:38.787Z (speaking on her support of Protecting Health 
Care for All Patients Act, H.R. 485, 118th Cong. (2023)).
---------------------------------------------------------------------------

    Response: OCR recognizes that value assessment methods can be 
helpful tools in making decisions in various contexts within health 
care and are used widely. The use of value assessment methods that 
result in discrimination on the basis of race, color, national origin, 
age, disability and sex are prohibited under section 1557's general 
mandate of nondiscrimination. That is, where a value assessment uses 
methods that penalize patients or groups of patients on a ground 
protected by section 1557 and where such methods then result in 
limiting access to an aid, benefit, or service, they may violate 
section 1557. In response to commenters, we note that value assessment 
tools cannot be used to, to deny or afford an unequal opportunity to 
qualified individuals with disabilities or on the basis of age with 
respect to the eligibility or referral for, or provision or withdrawal 
of any aid, benefit, or service, including the terms or conditions 
under which they are made available. We further note that methods of 
value assessment are permissible so long as they do not discriminate in 
discounting the per-year value of life extension on the basis of age or 
disability under section 1557.
    In addition, OCR has proposed a prohibition against the 
discriminatory use of value assessment methods in pending rulemaking 
under section 504. 88 FR 63409. Proposed Sec.  84.57, which applies to 
recipients of Federal financial assistance from HHS, prohibits, 
directly or through contractual, licensing, or other arrangements, 
using any measure, assessment, or tool that discounts the value of life 
extension on the basis of disability to deny or afford an unequal 
opportunity to qualified individuals with disabilities with respect to 
the eligibility or referral for, or provision or withdrawal of any aid, 
benefit, or service, including the terms or conditions under which they 
are made available.
    Given that many different measures exist for use in value 
assessment and may be applied in different ways, this discussion 
applies to evaluating any value assessment methodology rather than 
commenting on specific measures at this time. However, we appreciate 
the concerns raised by the commenters and will take them into account 
as OCR proceeds with future work on value assessment.
    Comment: Many comments on value assessment also requested further 
development of new value assessment measures and the incorporation of 
input from patients with disabilities (and, per some commenters, their 
family members and providers) into value assessment schema. Commenters 
urged the Department to support the development and dissemination of 
these methodologies. Another commenter noted that cultural barriers 
existed in institutions that prevented the adoption of new metrics.
    Response: OCR appreciates commenters' input and encourages and 
supports the development of such metrics and the incorporation of input 
from people with disabilities and other interested groups protected 
under section 1557, as reflected in research priorities elsewhere in 
the Department. Numerous research and grantmaking initiatives from the 
National Institutes of Health (NIH) and the National Institute on 
Disability, Independent Living, and Rehabilitation Research (NIDILRR) 
support this and similar efforts.\224\ In addition, OCR notes that the 
National Council on Disability issued an updated policy brief released 
in November 2022.\225\
---------------------------------------------------------------------------

    \224\ Funding Opportunity Announcement, U.S. Dep't of Health & 
Hum. Servs., Nat'l Insts. of Health, NIH Faculty Institutional 
Recruitment for Sustainable Transformation (FIRST) Program: FIRST 
Cohort (U54 Clinical Trial Optional) (December 8, 2020), https://grants.nih.gov/grants/guide/rfa-files/RFA-RM-20-022.html; U.S. Dep't 
of Health & Hum. Servs., Adm. for Cmty. Living, Disability and 
Rehabilitation Research Projects (DRRP) Program, https://acl.gov/programs/research-and-development/disability-and-rehabilitation-research; U.S. Dep't of Health & Hum. Servs., Nat'l Insts. of 
Health, All of Us Research Program, https://allofus.nih.gov/.
    \225\ Nat'l Council on Disability, Alternatives to QALY-Based 
Cost-Effectiveness Analysis for Determining the Value of 
Prescription Drugs and Other Health Interventions (2022), https://www.ncd.gov/report/alternatives-to-qaly-based-cost-effectiveness-analysis-for-determining-the-value-of-prescription-drugs-and-other-health-interventions/.
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Benefit Design Analysis
    The comments and our responses regarding benefit design are set 
forth below.
    In the Proposed Rule, we discussed that OCR will apply basic 
nondiscrimination principles to the facts of the particular plan or 
coverage when analyzing allegations of discrimination under this 
section to determine if the challenged action is unlawful. We discussed 
that, consistent with general principles in civil rights law, covered 
entities will have the opportunity to articulate a legitimate, 
nondiscriminatory justification for an alleged discriminatory action or 
practice, and that OCR will scrutinize the justification to ensure it 
is not a pretext for discrimination.
    Comment: Some commenters requested that OCR provide additional 
guidance explaining how it intends to investigate potential violations 
by health programs or activities engaged in providing or administering 
health insurance coverage or other health-related coverage and to 
ensure ongoing compliance with Federal law. Commenters urged OCR to 
establish clear, predictable standards that covered entities can rely 
upon when designing their plans and that will ensure OCR's ``case-by-
case'' analysis does not result in only retroactive reviews of existing 
plans or lead to arbitrary results.
    Another commenter noted that if OCR will not provide presumptively 
discriminatory benefit design examples, OCR should provide more 
information to educate covered entities about what OCR interprets to be 
best practices other than the information, corrective plans, and 
resolution agreements it stated it would publish on its website in the 
2016 Rule. The commenter urged OCR to publicly publish deidentified 
information on each and every investigation that it pursues, including 
the specific actions purported to be discriminatory by a covered 
entity, the alleged basis of discrimination, and OCR's resolution of 
the complaint so that covered entities can educate themselves on best 
practices and actions that OCR may deem to be discriminatory.
    Response: We appreciate the comments requesting further specificity 
regarding OCR's analysis when investigating potential violations under 
this section. We agree that providing clarity to covered entities 
promotes compliance and reduces prohibited discrimination. Each 
potentially discriminatory action involves unique

[[Page 37616]]

facts and circumstances that must be independently investigated on a 
case-by-case basis before OCR can determine whether a challenged action 
is considered discriminatory under this section, particularly 
considering that each covered entity's reason for engaging in the 
challenged action may be specific to that covered entity and the 
circumstances surrounding its decision process. For example, when 
determining whether a challenged design feature is discriminatory, OCR 
considers the benefit design of the plan as a whole, whether similar 
limitations or restrictions are placed on other types of health 
services, and whether the covered entity consistently relies on 
neutral, nondiscriminatory criteria when developing the design feature, 
among other things. Therefore, OCR reaffirms the investigative approach 
set forth in the Proposed Rule, 87 FR 47875, whereby OCR's 
determination of whether a challenged action is discriminatory is 
necessarily a fact-specific, case-by-case analysis dependent on the 
facts of the particular situation. When analyzing whether an action 
violates this section, OCR will apply basic nondiscrimination 
principles to the facts of the particular health insurance coverage or 
other health related coverage, consistent with civil rights case law. 
This includes the opportunity for covered entities to articulate a 
legitimate, nondiscriminatory justification for an alleged 
discriminatory action, which OCR will scrutinize to ensure it is not a 
pretext for discrimination. Where a covered entity's justification 
relies upon medical standards or guidelines, we note that such 
standards or guidelines may be subject to additional scrutiny if they 
are not based on clinical, evidence-based criteria or guidelines. For 
more information related to OCR's consideration of a covered entity's 
legitimate, nondiscriminatory reason, please see previous discussion 
under Sec.  92.207(c).
    OCR reiterates that this rule does not require a covered entity to 
provide coverage for any particular health service in its health 
insurance coverage or other health-related coverage when provided in a 
nondiscriminatory manner; however, to the extent a covered entity 
provides coverage for a particular health service, the covered entity 
must provide the health service to all individuals in a neutral, 
nondiscriminatory manner consistent with this rule.
    Regarding our analysis when investigating potential discrimination 
in the benefit design of excepted benefits and short-term, limited 
duration insurance (STLDI), we provide additional information below in 
the discussion under this section on Scope of Application to Health 
Insurance and Health-Related Coverage (Including Excepted Benefits and 
STLDI).
    OCR acknowledges that the nature of our complaint-driven 
investigative process results in OCR reviewing existing plans and 
making determinations on the benefit designs of existing plans. 
However, OCR's case-by-case analysis is necessary in order to consider 
the fact-specific nature of each challenged action and to apply 
relevant case law to each situation. OCR investigates each allegation 
in a consistent manner and treats all complainants and covered entities 
evenly.
    We appreciate commenters' suggestions to provide more information 
to educate covered entities about what OCR interprets to be best 
practices; OCR will consider issuing such guidance in the future. To 
educate both the public and covered entities, OCR posts its resolution 
agreements on its website and issues press releases when cases are 
resolved, and we intend to continue this practice.
    Comment: Commenters recommended that OCR specify in the final rule 
that a nondiscriminatory benefit design is one that is clinically 
based. While expressing support for OCR considering clinical guidelines 
and standards of care when evaluating plan benefit designs, these same 
commenters also cautioned that OCR should not exclusively rely on 
clinical guidelines and journal articles in its analysis of 
discriminatory design because clinical guidelines may perpetuate racial 
bias and health disparities, and entities could cite a single peer-
reviewed article as a shield to escape valid claims of discriminatory 
benefit design.
    Response: An analysis of whether a benefit design is discriminatory 
under this rule is a fact-specific inquiry that will be made in 
accordance with general civil rights principles and applicable case 
law. As discussed under Sec.  92.207(c), covered entities may provide a 
legitimate, nondiscriminatory reason as a defense to a potentially 
discriminatory coverage determination. A covered entity has latitude to 
submit any legitimate reason for its actions as long as it is not 
discriminatory or pretext for discrimination. However, if the 
justification given is not based on clinical, evidence-based criteria 
or guidelines, OCR will consider that evidence of pretext. When a 
covered entity submits a justification that relies upon medical 
standards or guidelines, OCR may conduct additional investigation to 
ensure the justification is not pretextual, including a review on 
whether the standards or guidelines are or are not based on clinical, 
evidence-based criteria or guidelines. OCR's review of a covered 
entity's justification will not rely solely on a covered entity's 
provision of one piece of literature but will consider a variety of 
factors, as discussed in detail above under Sec. Sec.  92.206(c) and 
92.207(c). We further note that OCR will not conduct a general medical 
review of the medical judgment undergirding the determination.
    Comment: Commenters noted that OCR could ensure higher quality 
health care for all enrollees through stronger oversight and 
regulation. These commenters urged OCR not to rely solely on complaints 
and to engage in proactive oversight by affirmatively reviewing covered 
entities' plan designs.
    Response: We agree that robust enforcement of section 1557 is 
critical to ensure individuals' ability to receive medically necessary 
health services, unencumbered by discriminatory conduct. OCR will 
employ all available means of investigating health insurance coverage 
and other health-related coverage under this rule, including through 
compliance reviews and complaint investigations.
    Comment: Commenters requested that OCR clarify how it will 
coordinate with State and Federal agencies that establish specific plan 
requirements and approval processes. Commenters noted that many facets 
of benefit design are heavily regulated by other agencies within the 
Department, including CMS' regulation of nondiscriminatory plan design 
in EHB and qualified health plans, retail pharmacy network adequacy of 
Medicare Part D plans, and benefit coverage requirements under Medicare 
Advantage and Medicaid. Commenters suggested that OCR should not 
enforce a discrimination claim if the underlying design is accepted by 
the plan's regulator and should defer enforcement action to existing 
review processes where appropriate. Some commenters also suggested that 
the Department should establish a safe harbor for health insurance 
issuers to comply with section 1557 in cases where there are State law 
interactions to avoid creating multiple or duplicative standards.
    Response: OCR acknowledges commenters' concerns about harmonization 
in the regulation and enforcement of benefit design requirements across 
State and Federal laws. We note that covered entities offering health 
insurance coverage and other health-related coverage, such

[[Page 37617]]

Medicaid or qualified health plans in the Exchanges, are subject to a 
host of other laws and regulations, at both the State and Federal 
level. OCR does not view a covered entity's compliance with other State 
or Federal laws, which were adopted under different requirements and 
for different purposes, to be determinative in all cases of a covered 
entity's compliance with section 1557, unless otherwise specified in 
this rule.\226\ OCR commits to coordinating with other Federal agencies 
as appropriate to avoid inconsistency and duplication in enforcement 
efforts and will consider issuing guidance in coordination with other 
agencies, such as CMS, after publication of the rule. We will give 
consideration to a covered entity's compliance with other Federal laws 
when those requirements overlap with section 1557's requirements and 
will work closely with covered entities when compliance with this final 
rule requires additional action. That said, as the lead enforcement 
agency for section 1557, OCR maintains sole authority to determine a 
covered entity's compliance with this final rule.
---------------------------------------------------------------------------

    \226\ E.g., 45 CFR 92.203, which requires covered entities to 
comply with certain accessibility requirements in the ADA.
---------------------------------------------------------------------------

    Comment: Commenters requested clarity on which covered entity is 
liable for potentially discriminatory plan benefit designs when several 
covered entities provide or administer elements of the benefit design. 
Commenters requested that OCR state that all entities, including third 
party administrators, benefits advisers, and consultants, that 
participate in discriminatory plan design with respect to group or 
individual insurance plans are covered entities under section 1557. A 
commenter requested that benefits advisers or consultants working with 
employers to design self-funded group health plans specifically should 
be considered a covered entity presumptively where the employer, the 
plan, or the third party administrator receives Federal financial 
assistance. The commenter noted concern that such advisers and 
consultants are a driving force behind discriminatory plan design and 
should be put on notice that their conduct is subject to section 1557 
in many circumstances. A commenter requested that OCR make clear that 
any entity itself covered by section 1557 violates the statute by 
outsourcing the implementation or design of discriminatory plans to 
entities that might themselves not be covered by the statute.
    Response: OCR clarifies that in situations where multiple covered 
entities provide or administer elements of a discriminatory benefit 
design, all of the entities may be found liable under section 1557. In 
the discussion of the definition of ``Federal financial assistance'' in 
Sec.  92.4, we explained that both the direct recipient and 
subrecipient (or subcontractor) are responsible for complying with 
applicable civil rights laws. We also note that covered entities are 
responsible for the conduct of their subcontractors and cannot 
outsource or contract away their civil rights obligations by entering 
into contractual arrangements with subcontractors. The responsibility 
of third party administrators is discussed later in this section. As 
noted, this final rule does not apply to employment practices. See 
Sec.  92.2(b).
    Comment: Commenters expressed concern that the proposed regulation 
may unintentionally limit covered entities' ability to develop 
effective programs and initiatives to close care gaps and address 
unique needs to reduce health disparities. Commenters explained that 
they currently conduct individual outreach to members of a subgroup 
through care management processes, invest in social determinants of 
health interventions, tailor marketing to subgroups to address 
particular health concerns, provide plans that restrict enrollment to 
special needs individuals with specific chronic conditions, and develop 
targeted quality programs and chronic care management programs to 
reduce health disparities for their members. A commenter noted that 
issuers take those actions to more efficiently provide care to 
particularly vulnerable populations without an intent to discriminate. 
Another commenter noted that if health plans are required to provide 
services that address chronic care, social determinants of care, or 
other similar programs ``equally'' to all enrollees rather than 
``equitably'' target services to those in need based on health or 
socioeconomic condition, plans will be limited in their ability to 
provide appropriate services and scale and sustain these programs. To 
address these concerns, commenters requested that OCR clarify in the 
final rule that actions taken to reduce health disparities and those 
designed to improve health for specific populations are not 
discriminatory for purposes of section 1557. Commenters also 
recommended that OCR consider an approach similar to language in the 
Department's Group Health Insurance Market regulations prohibiting 
prohibition on discrimination based on health status that explicitly 
permits group health plans and health insurance issuers to treat 
individuals with adverse health conditions more favorably. 45 CFR 
146.121(g).\227\
---------------------------------------------------------------------------

    \227\ In this final rule, we cite to HHS regulations, but note 
that the Departments of Labor and the Treasury have parallel 
regulatory citations.
---------------------------------------------------------------------------

    Response: We appreciate commenters raising this concern and applaud 
efforts to mitigate and address health disparities. Nothing in this 
rule prohibits programs designed to improve health outcomes for 
specific populations so long as the programs do not discriminate on the 
basis of race, color, national origin, age, sex, or disability. For 
example, programs could be developed using social determinants of 
health or other metrics that serve to identify underrepresented 
individuals that are not based on protected bases under section 1557. 
To illustrate, a ``Special Needs Plan'' is a specialized Medicare 
Advantage coordinated care plan that exclusively enrolls ``special 
needs individuals,'' who are not limited to individuals with 
disabilities, and do not violate section 1557.\228\ In addition, 
covered entities are permitted and encouraged to develop programs that 
address health disparities related to a person's age. Under the Age Act 
and section 1557, age distinctions in programs that provide special 
benefits to older adults or children are permitted. 45 CFR 91.17 (Age 
Act); 92.101(b)(1) (section 1557, incorporating 45 CFR 91.17).
---------------------------------------------------------------------------

    \228\ See sections 1859(b)(6), 1859(f)(2)-(4) of the Social 
Security Act (42 U.S.C. 1395w-28(b)(6), (f)(2)-(4)).
---------------------------------------------------------------------------

Scope of Application to Health Insurance Coverage and Other Health-
Related Coverage (Including Excepted Benefits and STLDI)
    In the 2022 NPRM, we sought comment on excepted benefits and short-
term, limited-duration health insurance (STLDI), and the Proposed 
Rule's application to these products. Consistent with the definition of 
``health program or activity'' under Sec.  92.4, we proposed that the 
rule would apply to all the operations of any covered entity 
principally engaged in the provision or administration of health 
insurance coverage or other health-related coverage. 87 FR 47875-
76.\229\ As an example, we explained that an issuer participating in 
the Exchange and thereby receiving Federal financial assistance would 
be covered by the rule for its qualified health plans offered on the 
Exchange, as well as for its health

[[Page 37618]]

plans offered outside the Exchange, including, for example, large group 
market plans,\230\ grandfathered plans,\231\ grandmothered plans,\232\ 
excepted benefits,\233\ and STLDI,\234\ as well as for its operations 
related to acting as a third party administrator for self-insured group 
health plans. 87 FR 47876.
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    \229\ However, per Sec.  92.2(b), this rule does not apply to 
employers with regard to their employment practices, including the 
provision of employee health benefits.
    \230\ 42 U.S.C. 300gg-91(e)(3); 45 CFR 144.103.
    \231\ 42 U.S.C. 18011; 45 CFR 147.140.
    \232\ Grandmothered plans are certain non-grandfathered health 
insurance coverage in the individual and small group market that are 
not considered to be out of compliance with certain specified market 
reforms under certain conditions. See U.S. Dep't of Health & Hum. 
Servs., Ctrs. for Medicare & Medicaid Servs., Extended Non-
Enforcement of Affordable Care Act-Compliance With Respect to 
Certain Policies (Mar. 23, 2022), https://www.cms.gov/files/document/extension-limited-non-enforcement-policy-through-calendar-year-2023-and-later-benefit-years.pdf.
    \233\ 42 U.S.C. 300gg-21(b), 300gg-63, and 300gg-91(c); 45 CFR 
144.103, 146.145(b), and 148.220(b). The Departments of HHS, Labor, 
and the Treasury share interpretive jurisdiction over the definition 
of ``excepted benefits''. We cite to HHS regulations but note that 
the Departments of Labor and the Treasury have parallel statutory 
and regulatory citations.
    \234\ Short-term limited duration insurance is a type of health 
insurance coverage that is generally exempt from the provisions of 
title XXVII of the PHS Act because it is specifically excluded from 
the definition of ``individual health insurance coverage'' in the 
PHS Act. See 42 U.S.C. 300gg-91(b)(5). Short-term limited duration 
insurance is currently defined in Federal regulations as health 
insurance coverage issued under a contract that is effective for 
less than 12 months, and, taking into account renewals or 
extensions, has a duration of no longer than 36 months in total. 45 
CFR 144.103. Short-term limited duration insurance is defined by the 
Departments of HHS, Labor, and the Treasury (Tri-Departments). The 
Tri-Departments issued a Notice of Proposed Rulemaking on Short-
Term, Limited-Duration Insurance; Independent, Noncoordinated 
Excepted Benefits Coverage; and Tax Treatment of Certain Accident 
and Health Insurance that would revise the definition of ``Short-
Term Limited-Duration Insurance'' to limit the length of the initial 
contract period to no more than three months and the maximum 
coverage period to no more than four months, taking into account any 
renewals or extensions. 88 FR 44596 (July 12, 2023). In this final 
rule, we cite to HHS regulations, but note that the Departments of 
Labor and the Treasury have parallel regulatory citations.
---------------------------------------------------------------------------

    The comments and our responses regarding the scope and application 
to all operations of a covered health insurance issuer and to excepted 
benefits and STLDI specifically are set forth below.
    Comment: Several commenters, including those representing the 
health insurance industry and some State insurance regulators, raised 
concerns about how the Proposed Rule's application to all operations of 
a recipient health insurance issuer would result in covering an 
issuer's other operations and lines of business that do not receive 
Federal financial assistance, including, for example, plans sold off 
the Exchange, grandfathered plans, grandmothered plans, employer plans, 
excepted benefits, STLDI, third party administrator activities and 
pharmacy benefit manager activities. Commenters noted that these plans 
are treated separately under the ACA and are not subject to some or all 
of the ACA's health insurance market reforms. Commenters suggested that 
plans that do not receive Federal financial assistance should not be 
subject to section 1557. Comments about particular types of plans are 
discussed in turn below.
    Commenters argued the Proposed Rule's application was too broad and 
went beyond Congressional intent and urged OCR to retain the 2020 
Rule's approach that the rule cover a health insurance issuer's 
operations only to the extent the operations directly receive Federal 
financial assistance.
    In addition, commenters argued that applying the rule to a covered 
issuer's operations that do not receive Federal financial assistance 
would create an unlevel playing field among health insurance issuers 
that accept Federal funding and those that do not, placing those that 
receive Federal funding at a competitive disadvantage. For example, 
commenters stated that issuers that do not receive Federal financial 
assistance may underwrite excepted benefits or STLDI by age or sex, or 
exclude higher cost health care services, which may result in non-
covered entities offering lower-cost coverage to a pool of individuals 
whose coverage is less costly, while the pool of individuals under a 
covered entity's coverage could be costlier, leading to higher 
premiums. Commenters also argued that covered entities would be subject 
to increased compliance costs to which competitors are not subject. For 
example, these commenters stated that compliance with the rule's 
nondiscrimination notices would result in tremendous costs to which 
non-covered entities are not subject. Some commenters argued that this 
competitive disadvantage could discourage issuers from participating in 
the Exchanges.
    A few commenters that supported the proposed application to all an 
issuer's operations also raised concerns that the rule would create an 
unlevel playing field that would disadvantage plans that support 
Federal programs like Medicare and Medicaid while giving an unfair 
competitive advantage to competitors that are not required to comply 
with nondiscrimination requirements. To level the playing field, these 
commenters and others suggested that OCR work with other Federal 
agencies and develop a tri-Department rule with the Departments of 
Labor and the Treasury to subject all health plans to similar 
nondiscrimination and accessibility requirements.
    A number of commenters, including some members of Congress, 
supported the broad application of the rule to an issuer's other 
operations and argued the 2020 Rule's approach is contrary to 
Congress's intent in passing the ACA to prohibit discrimination in 
health care. Commenters argued that a private insurance company 
receiving financial assistance from the Federal Government should not 
be allowed to engage in discriminatory practices in its other lines of 
business. Commenters observed that issuers offering plans that receive 
Federal financial assistance, such as qualified health plans or 
Medicare Advantage plans, often also offer plans that do not receive 
Federal financial assistance. Noting that many of these other types of 
plans are not currently subject to any or all nondiscrimination 
requirements under the ACA's health insurance market reforms, these 
commenters argued that the Proposed Rule's broad application will 
increase protections from discriminatory practices for individuals 
enrolled in those plans.
    Response: OCR appreciates the concerns raised by some commenters 
regarding the Proposed Rule's application to all operations of a 
recipient health insurance issuer; however, these concerns do not 
abrogate a recipient's obligation to comply with section 1557. Under 
the definition of ``health program or activity'' at Sec.  92.4, a 
recipient of Federal financial assistance that is principally engaged 
in the provision or administration of health insurance coverage or 
other health-related coverage is covered under this rule for all of its 
operations. Section 1557 applies to ``any health program or activity, 
any part of which is receiving Federal financial assistance,'' 42 
U.S.C. 18116(a) (emphasis added). As we explain in detail under the 
discussion of the definition of ``health program or activity'' in Sec.  
92.4, it is reasonable to infer that Congress intended the term 
``health program or activity'' to be interpreted broadly and to include 
all of that entity's operations if the entity that receives Federal 
funding is principally engaged in the provision or administration of 
health insurance coverage or other health-related coverage.\235\
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    \235\ See, e.g., Fain v. Crouch, 545 F. Supp. 3d 338, 342-43 
(S.D.W. Va. 2021) (finding ```health program or activity' under 
Section 1557 necessarily includes health insurance issuers'' and 
holding that defendant health plan was, ``by virtue of its 
acceptance of federal assistance under its Medicare Advantage 
program,'' required to comply with section 1557 ``under its entire 
portfolio''), rehearing en banc granted, No. 22-1927 (4th Cir. Apr. 
12, 2023) (oral argument held Sept. 21, 2023) (argued with Kadel v. 
Folwell, No. 22-1721).

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[[Page 37619]]

    In response to comments that this obligation might cause a 
competitive disadvantage with entities that do not accept Federal 
funds, this obligation is consistent with statutory text as set forth 
by Congress, as discussed above. Further, the risk of competitive 
disadvantage is low given that the majority of health insurance issuers 
offer some type of product that receives Federal financial assistance, 
such as Medicare Advantage plans, Medicare Part D prescription drug 
plans, Medicaid managed care plans, and qualified health plans through 
the Exchanges.\236\ In any event, by accepting the benefit of Federal 
funds, a recipient is prohibited from discriminating in its health 
programs and activities under section 1557, as discussed previously 
under the definition of ``health program or activity.'' Any recipient 
of Federal financial assistance from the Department is subject to this 
same requirement and prohibited from discriminating in its health 
programs and activities, including all of its operations when 
principally engaged, as set forth in this final rule.
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    \236\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Medical Loss Ratio Data and System Resources 
(2022), https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr.
---------------------------------------------------------------------------

    Section 1557 does not authorize OCR to require a health plan or 
insurance issuer not otherwise subject to section 1557 to comply with 
the statute. Whether the Department could issue a rule, under different 
authority, with the Departments of Labor and the Treasury, to apply 
similar nondiscrimination and accessibility standards to all health 
plans or health insurance issuers, is outside the scope of this rule.
    We further address comments about particular types of plans and 
their coverage under this final rule in various comment responses 
below.
    Comment: Some commenters requested that grandfathered and 
grandmothered plans should be exempt from the rule because they are not 
subject to many of the ACA's provisions. These plans benefit consumers, 
commenters stated, by allowing them to maintain affordable existing 
coverage as long as it continues to meet their needs. Commenters argued 
that applying section 1557 to these plans would be inconsistent with 
the longstanding regulatory treatment of the plans. Further, commenters 
argued that the costs of complying with section 1557, including but not 
limited to notice and tagline requirements, could result in increased 
costs for issuers, which would be passed on to consumers, and could 
lead to a decision to discontinue plans.
    Response: OCR understands commenters' concerns and acknowledges 
that grandfathered and grandmothered plans are not subject to many of 
the ACA's provisions. However, the statutory text of the grandfathered 
health plan provision \237\ indicates that Congress did not intend to 
exclude them from dection 1557. The statute sets forth the specific 
provisions of the PHS Act that apply to grandfathered plans and then 
provides that except for those provisions, ``this subtitle and subtitle 
A (and the amendments made by such subtitles) shall not apply'' to 
grandfathered plans. 42 U.S.C. 18011(a)(2). ``This subtitle'' refers to 
subtitle C of title I of the ACA, while ``subtitle A'' refers to 
subtitle A of title I of the ACA, both of which contain market reforms. 
Section 1557 is in subtitle G of title I of the ACA and therefore is 
not one of the subtitles that Congress specified should not apply to 
grandfathered health plans.
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    \237\ Grandfathered health plans were established by Congress in 
title I of the ACA to permit the continuation of coverage for 
certain plans in effect as of the date of enactment of the ACA 
(March 23, 2010) in which individuals were enrolled at that time. 42 
U.S.C. 18011; 45 CFR 147.140. Grandfathered health plans are 
statutorily subject to only certain market reforms in the ACA, 42 
U.S.C. 18011(a)(3)-(5), and thus are not subject to certain market 
reforms related to nondiscrimination, such as fair health insurance 
premiums and EHB. To maintain grandfathered status, plans cannot 
make certain changes to the terms of the plan or coverage. 
Specifically, certain changes to benefits, cost-sharing 
requirements, and contribution rates will cause a plan or coverage 
to relinquish its grandfather status.
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    Grandmothered plans \238\ were not established in the ACA or the 
PHS Act; they are not exempt from the ACA or the PHS Act by statute or 
regulation. Rather, CMS specified that it will not take enforcement 
actions against grandmothered plans that are out of out of compliance 
with certain specified ACA market reforms under certain conditions (CMS 
Non-Enforcement Policy).\239\ The CMS Non-Enforcement Policy has been 
in place since 2013 \240\ and has provided relief from the same ACA 
market reform provisions continuously since that time.\241\ Section 
1557 has never been one of the provisions for which enforcement relief 
was provided; therefore, grandmothered plans are not exempt from 
section 1557.
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    \238\ Grandmothered plans are certain non-grandfathered health 
insurance coverage in the individual and small group market that are 
not considered to be out of compliance with certain specified market 
reforms under certain conditions, including those related to 
nondiscrimination, such as fair health insurance premiums, the 
prohibition of preexisting condition exclusions or other 
discrimination based on health status with respect to adults (except 
with respect to group coverage), the prohibition of discrimination 
based on health status (except with respect to group coverage), and 
EHB.
    \239\ See U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare 
& Medicaid Servs., Extended Non-Enforcement of Affordable Care Act-
Compliance With Respect to Certain Policies (Mar. 23, 2022), https://www.cms.gov/files/document/extension-limited-non-enforcement-policy-through-calendar-year-2023-and-later-benefit-years.pdf.
    \240\ See Letter from Gary Cohen, Director, Ctr. for Consumer 
Info. & Ins. Oversight, Ctrs. for Medicare & Medicaid Servs., to 
Insurance Commissioners (Nov. 14, 2013), https://www.cms.gov/cciio/resources/letters/downloads/commissioner-letter-11-14-2013.pdf.
    \241\ See U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare 
& Medicaid Servs., Extended Non-Enforcement of Affordable Care Act-
Compliance With Respect to Certain Policies (Mar. 23, 2022), https://www.cms.gov/files/document/extension-limited-non-enforcement-policy-through-calendar-year-2023-and-later-benefit-years.pdf.
---------------------------------------------------------------------------

    When offered by a recipient health insurance issuer, grandfathered 
and grandmothered plans would be covered under the rule as part of the 
issuer's operations when the issuer is principally engaged in the 
business of providing or administering health insurance coverage or 
other health-related coverage. If OCR were to receive a complaint about 
a grandfathered plan or grandmothered plan, OCR would carefully 
consider the facts and circumstances of the challenged action or 
practice. As discussed throughout this section, the health insurance 
issuer may provide a legitimate, nondiscriminatory reason for the 
action or practice. Further, in cases of alleged disability 
discrimination, covered entities may also prove that modifying a plan 
to comply with section 1557 would result in a fundamental alteration to 
their health program or activity.
    Comment: A commenter requested clarification on how the rule would 
apply to Medicare Employer Group Waiver Plan (EGWP) participants.
    Response: EGWPs are types of Medicare Part C (Medicare Advantage) 
plans \242\ or Medicare Part D prescription drug plans \243\ that 
qualify for waivers of certain Medicare regulations because they are 
offered exclusively to the employees, former employees, members or 
former members of an employer, union or labor organization, or the 
trustees of a fund established by one or more employers or labor 
organizations (or combination thereof). Entities that receive funding 
through the Department's Medicare Part C or Medicare Part D program are 
subject to the rule as recipients of Federal financial assistance. This 
includes entities providing Medicare

[[Page 37620]]

Advantage plans or Medicare Part D plans, including EGWPs, or qualified 
retiree prescription drug plans (as defined at 42 CFR 423.882) (also 
known as RDS plans). Because employers and other plan sponsors are not 
subject to this rule with regard to their employment practices, 
pursuant to Sec.  92.2(b), an employer or other plan sponsor would not 
be liable for discrimination related to these plans under this rule. 
This applies even if an employer directly contracts with CMS to offer a 
Medicare Advantage or Part D plan as an EGWP and receives Federal 
financial assistance for that EGWP.\244\ In circumstances where an 
employer offers an ``800 series'' EGWP through a Medicare Advantage 
organization or Part D plan sponsor,\245\ the health insurance issuer 
or entity offering the EGWP would be subject to the rule for the EGWP 
plan due to receipt of either Medicare Part C or Part D funding.
---------------------------------------------------------------------------

    \242\ 42 U.S.C. 1395w-27(i); 42 CFR 422.106.
    \243\ 42 U.S.C. 1395w-132(b); 42 CFR 423.458.
    \244\ CMS may contract directly with an employer, union or labor 
organization, or the trustees of a fund established by one or more 
employers or labor organizations (or combination thereof) for the 
entity to offer a Medicare Advantage plan or Part D plan to its 
employees, former employees, members or former members. 42 U.S.C. 
1395w-28(i) and 1395w-132(b); 42 CFR 422.106(d) and 423.458(c).
    \245\ In these situations, a Medicare Advantage organization or 
a Part D plan sponsor contracts with CMS to offer the Medicare 
health or drug plan and separately contracts with the employer, 
union or labor organization, or trustee of a fund established by one 
or more employers or labor organizations (or combination thereof) 
for the Medicare Advantage organization or Part D plan sponsor to 
offer an EGWP. For more information about direct contract and ``800 
series'' EGWPs, see generally U.S. Dep't of Health & Hum. Servs., 
Ctrs. for Medicare & Medicaid Servs., Medicare Managed Care Manual, 
Chapter 9--Employer/Union Sponsored Group Health Plans (2013), 
https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/mc86c09.pdf.
---------------------------------------------------------------------------

    Comment: One commenter requested clarification as to whether self-
funded non-Federal Governmental plans, such as municipal plans, that 
opt out of certain Federal market reforms are covered under this rule 
if they receive funds from the Department directly or indirectly.
    Response: A self-funded non-Federal Governmental plan is a 
governmental plan established or maintained by a non-Federal 
Governmental agency, such as a State, county, school district, or 
municipality, for its employees.\246\ As with any other type of group 
health plan coverage, a non-Federal Governmental plan would be subject 
to this rule if it directly or indirectly receives Federal financial 
assistance from the Department. The non-Federal Governmental agency 
sponsoring the employee health benefit plan would be excluded from 
liability under this rule an employer or plan sponsor, as applicable, 
pursuant to Sec.  92.2(b).
---------------------------------------------------------------------------

    \246\ 42 U.S.C. 300gg-91(d)(8)(A)-(C); 45 CFR 144.103. For more 
information on self-funded, non-Federal Governmental plans, see U.S. 
Dep't of Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., 
Self-Funded, Non-Federal Governmental Plans, https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Market-Reforms/nonfedgovplans.
---------------------------------------------------------------------------

    Comment: Commenters requested that the rule clarify when group 
health plans are subject to the rule.
    Response: A group health plan is subject to this rule if it is a 
recipient (or subrecipient) of Federal financial assistance as set 
forth under Sec.  92.2(a)(1). We address the rule's applicability to 
group health plans in more detail in the discussion above under 
Sec. Sec.  92.1 (Applicability) and 92.4 (definition of ``health 
program or activity'').
    Comment: Several commenters expressed concerns with the rule's 
proposed application to excepted benefits as part of a covered health 
insurance issuer's operations and urged OCR to exclude excepted 
benefits from the rule. Commenters argued that the rule's coverage of 
excepted benefits is inconsistent with Congressional intent and likely 
subject to legal challenge. These commenters explained that excepted 
benefits are statutorily defined benefits that Congress has long 
recognized as distinct from traditional health insurance coverage by 
excluding them from health insurance and group health plan coverage 
mandates under the PHS Act, ERISA, and the Internal Revenue Code, as 
long as they meet certain requirements.\247\ Commenters argued that the 
ACA retained this exclusion and that Congress therefore intended 
excepted benefits to be excluded from the ACA. To further demonstrate 
Congressional intent to exclude excepted benefits, commenters stated 
that since Congress first recognized excepted benefits in 1996 as part 
of HIPAA by incorporating their provisions into the PHS Act, ERISA, and 
the Internal Revenue Code, Congress has had several opportunities to 
redefine excepted benefits or to impose new requirements on them in 
subsequent laws, including the ACA, but it has not chosen to do 
so.\248\
---------------------------------------------------------------------------

    \247\ Title XXVII of the PHS Act; part 7 of ERISA; chapter 100 
of the Internal Revenue Code.
    \248\ For example, the Mental Health Parity Act of 1996; 
Newborns' and Mothers' Health Protection Act of 1996 (NMHPA); 
Genetic Information Nondiscrimination Act of 2008 (GINA); Paul 
Wellstone and Pete Domenici Mental Health Parity and Equity 
Additional Act of 2008 (MHPAEA); Michelle's Law (2008); ACA (2010); 
and No Surprises Act (2020).
---------------------------------------------------------------------------

    While acknowledging that section 1557 does not explicitly exclude 
excepted benefits, commenters asserted that OCR cannot use its 
regulatory authority to impose new requirements that are inconsistent 
with the carefully crafted statutory provisions governing excepted 
benefits where Congress has clearly chosen not to do so. As support, 
commenters cited to Central United Life v. Burwell, 827 F.3d 70 (D.C. 
Cir. 2016). Commenters stated the court in Central United struck down a 
Department rule that revised the requirements related to fixed 
indemnity excepted benefit insurance in the individual market as an 
unconstitutional exercise of regulatory authority because the ACA 
maintained the HIPAA excepted benefit exemption for these benefits and 
the law did not authorize the Department's proposed requirement. 
Central United, commenters argued, illustrates that nothing in the ACA 
changes the excepted benefits governing statutes and demonstrates that 
agencies must adhere to the boundaries set forth in Federal statute.
    Commenters stated that the ACA is entirely focused on comprehensive 
medical coverage, while excepted benefits are not intended to serve as 
such coverage. They maintained that excepted benefits are not used to 
finance the delivery of health care services but are meant to provide 
benefits for a wide variety of costs associated with accidents or 
illnesses not covered by comprehensive medical insurance, or to defray 
costs that are not fully covered by comprehensive medical coverage. For 
example, commenters stated that some of these products, such as dental 
and vision plans and Medicare supplemental insurance (Medigap), can 
cover additional benefits not included in comprehensive medical plans. 
Commenters stated that noncoordinated excepted benefits, such as fixed 
indemnity excepted benefits and specified disease excepted benefits 
coverage, must pay benefits regardless of whether the medical event 
triggering benefits is covered under another plan. Commenters stated 
that while comprehensive medical insurance coverage is regulated 
through HIPAA or the ACA, excepted benefits are subject to separate 
long-standing and extensive State regulatory regimes whereby Congress 
and State policymakers have consistently maintained excepted benefits 
are not meant to be a type of comprehensive health insurance that pays 
for medical benefits, and therefore, commenters argue, should not be 
within the purview of the ACA, including section 1557.
    Commenters further expressed concerns that applying the rule to 
excepted benefits could severely disrupt the market for these benefits 
and may drive competitors out of the market,

[[Page 37621]]

ultimately increasing health care costs and premiums and reducing 
product choice for consumers and employers, and thereby reducing access 
to care. Commenters also asserted that applying the rule to excepted 
benefits could result in increased costs that are passed onto consumers 
as increased premiums, which could result in individuals dropping 
coverage due to lack of affordability and thereby result in reducing 
access to care, particularly in dental plans where consumers are highly 
price sensitive when selecting coverage.
    Conversely, many other commenters supported applying the rule to 
excepted benefits as part of an issuer's operations. Commenters noted 
that excepted benefits are under-regulated and not otherwise subject to 
nondiscrimination requirements. Commenters argued this would provide 
comprehensive nondiscrimination protections for individuals enrolled in 
excepted benefits, particularly individuals with disabilities who face 
barriers to accessing care.
    Response: OCR appreciates the breadth of comments received and the 
concerns raised. Excepted benefits are statutorily defined benefits 
that are exempt from the Federal consumer protection and market reforms 
applicable to comprehensive coverage under title XXVII of the PHS Act, 
part 7 of ERISA, and Chapter 100 of the Internal Revenue Code 
(hereinafter the Federal consumer protections and market reform 
requirements applicable to comprehensive coverage). Some excepted 
benefits are exempt from the Federal consumer protection and market 
reform requirements applicable to comprehensive coverage in all 
circumstances, such as coverage only for accident, workers' 
compensation or similar coverage, disability income coverage, and 
coverage for on-site medical clinics. 42 U.S.C. 300gg-21(b), 300gg-
63(a), and 300gg-91(c)(1).
    Other types of coverage, known as limited excepted benefits, are 
exempt from the Federal consumer protection and market reform 
requirements applicable to comprehensive coverage when the benefits are 
offered under a separate policy, certificate or contract of insurance, 
or are otherwise not an integral part of the plan. 42 U.S.C. 300gg-
21(c)(1), 300gg-63(b), and 300gg-91(c)(2). Examples of limited excepted 
benefits include certain limited scope vision insurance and limited 
scope dental insurance (though stand-alone dental plans sold through 
the Exchange are subject to certain qualified health plan 
requirements),\249\ and long term care insurance.
---------------------------------------------------------------------------

    \249\ See, e.g., 45 CFR 155.1065 and 156.150.
---------------------------------------------------------------------------

    Another type of coverage, known as independent, noncoordinated 
excepted benefits, are exempt from the Federal consumer protection and 
market reform requirements applicable to comprehensive coverage when 
certain conditions are met. 42 U.S.C. 300gg-21(c)(2), 300gg-63(b), and 
300gg-91(c)(3). This category of excepted benefits includes coverage 
only for a specified disease or illness (such as cancer-only policies) 
and hospital indemnity or other fixed indemnity insurance.
    The final type of excepted benefit coverage is supplemental 
excepted benefits. Benefits are supplemental excepted benefits only if 
they are provided under a separate policy, certificate, or contract of 
insurance and are Medicare supplemental health insurance (also known as 
``Medigap''), coverage supplemental to the coverage provided under 10 
U.S.C. chapter 55 (also known as TRICARE supplemental programs), or 
similar supplemental coverage provided to coverage under a group health 
plan. 42 U.S.C. 300gg-21(c)(3), 300gg-63(b), and 300gg-91(c)(4).
    Excepted benefits offer more limited coverage than, and are 
generally not intended to be an alternative to or replacement for, 
comprehensive coverage. These products are not subject to the Federal 
consumer protections and market reform requirements applicable to 
comprehensive coverage when applicable criteria are met. As we stated 
in the 2016 Rule, 81 FR 31431, and the 2022 NPRM, 87 FR 47875, and 
restate here, the fact that excepted benefits are exempt from the 
Federal consumer protections and market reform requirements applicable 
to comprehensive coverage, including the ACA's consumer protections and 
market reforms, and are not intended to serve as comprehensive coverage 
does not justify their exclusion from section 1557.\250\ In addition, 
section 1557 does not limit its protections only to health programs and 
activities that are themselves subject to other provisions of the ACA 
or that are comprehensive coverage, but also applies to all operations 
of any covered entity that is principally engaged, as defined under the 
term ``health program or activity'' in Sec.  92.4. Further, section 
1557 is an independent provision, which Congress did not codify in the 
PHS Act or co-locate in the ACA with the ACA's market reforms. Further, 
section 1557 uses the broad term ``health program or activity,'' in 
contrast to elsewhere in the ACA where Congress specifically made 
distinctions between various types of insurance. If Congress had 
intended to limit section 1557's reach to only certain types of 
insurance in the PHS Act or to carve out excepted benefits from the 
scope of section 1557, it could have done so.
---------------------------------------------------------------------------

    \250\ We further note that none of the statutory provisions that 
establish the exemption for these products from the PHS Act Federal 
consumer protections and requirements applicable to comprehensive 
coverage extend beyond the requirements in title XXVII of the PHS 
Act. See 42 U.S.C. 300gg-21(b)-(c), 300gg-63, and 300gg-91(c).
---------------------------------------------------------------------------

    OCR is mindful of comments raised about potential market disruption 
and reduced health care options for the public. However, as we 
discussed previously in the definition of ``health program or 
activity'' under Sec.  92.4, commenters did not provide sufficient 
evidence to support this contention. Further, we note that when OCR has 
determined that a particular plan is discriminatory under this final 
rule, a covered entity may provide a legitimate, nondiscriminatory 
reason for the plan's benefit design. This could include evidence that 
compliance with Sec.  92.207 would result in making the plan 
unaffordable to the extent the covered entity could no longer offer the 
plan. When such a reason is proffered, OCR will carefully consider the 
evidence presented by the covered entity in making our determination as 
to whether the reason is legitimate and not pretext for discrimination. 
In the case of alleged disability discrimination, covered entities may 
also prove that modifying a plan to comply with section 1557 would 
result in a fundamental alteration to their health program or activity.
    For these reasons, we are not excluding excepted benefits from 
requirements established in this final rule. If a recipient health 
insurance issuer is principally engaged in the provision or 
administration of health insurance coverage or other health-related 
coverage, all of its operations are covered, including its provision of 
excepted benefits. Further, we note that a principally engaged issuer 
would not be covered under this rule for its excepted benefits 
subsidiary if the issuer can prove that the subsidiary is legally 
separate from its federally funded activities.\251\
---------------------------------------------------------------------------

    \251\ For more information on how OCR will analyze such claims, 
see discussion of subsidiary liability under the definition of 
``health program or activity'' in Sec.  92.4 and under the 
Application to Third Party Administrators in this section.
---------------------------------------------------------------------------

    Commenters' reliance on Central United to argue that this rule 
exceeds OCR's regulatory authority by imposing new requirements that 
are inconsistent

[[Page 37622]]

with statutory provisions regarding excepted benefits is misplaced. In 
Central United, the court invalidated the requirement at 45 CFR 
148.220(b)(4)(i) that an individual must attest to having minimum 
essential coverage prior to purchasing fixed indemnity excepted 
benefits coverage in the individual market. The court held that 
imposing that requirement went beyond what Congress required under the 
PHS Act. 827 F.3d at 74. The PHS Act statutes at issue in Central 
United contain statutory language specifically addressing excepted 
benefits, while section 1557 does not expressly mention or address 
excepted benefits. Further, Congress could have but did not extend the 
exemption under the PHS Act for these products to section 1557.\252\ 
OCR therefore maintains that this rule's interpretation and application 
to all operations of a recipient health insurance issuer when 
principally engaged, including an issuer's excepted benefits, is the 
best reading of the section 1557 statutory language, which applies to 
``any health program or activity, any part of which is receiving 
Federal financial assistance.'' 42 U.S.C. 18116(a) (emphasis added).
---------------------------------------------------------------------------

    \252\ See 42 U.S.C. 300gg-21(b)-(c) and 300gg-63. See also the 
conforming amendments in section 1563(a) of the ACA.
---------------------------------------------------------------------------

    Comment: A few commenters raised concerns with the sufficiency of 
the Proposed Rule's discussion on excepted benefits. These commenters 
asserted the Proposed Rule did not adequately explain why subjecting 
excepted benefits to the rule is necessary or appropriate. Commenters 
stated that the regulatory text does not address excepted benefits and 
that the preamble discussion does not explain how the rule would apply 
to excepted benefits. Thus, according to commenters, there was 
insufficient notice for public comment, which they assert would likely 
subject the final rule to legal challenge as violative of the 
Administrative Procedure Act. These commenters argued OCR should issue 
a new Proposed Rule with comment period that explains how OCR intends 
to address excepted benefits and provides additional clarity on how the 
rule will apply to excepted benefits, taking into account the specific 
nature and legal structure of such products that Congress made 
statutorily distinct from major medical products. Commenters also 
objected to the Proposed Rule's investigative approach to evaluate 
claims of discrimination on a case-by-case basis, with one commenter 
arguing the case-by-case approach indicated a ``regulation-by-audit 
scheme.''
    Response: We disagree that the Proposed Rule failed to adequately 
provide notice and opportunity to comment on OCR's reasoning regarding 
the applicability of section 1557 to all operations of a recipient 
health insurance issuer that is principally engaged in the provision or 
administration of health insurance coverage or other health-related 
coverage. We fully discussed OCR's legal authority and reasoning 
regarding this scope of coverage in the Proposed Rule's discussion of 
the definition of ``health program or activity'' under Sec.  92.4. 87 
FR 47844-45. We also disagree that the Proposed Rule did not provide 
notice to the public of the terms or substance of how OCR intends to 
address excepted benefits for purposes of applying section 1557. In the 
preamble to the Proposed Rule, we clearly stated that all operations of 
a covered issuer principally engaged would include its other plans, 
explicitly mentioning excepted benefits. 87 FR 47875-76. Further, in 
the Proposed Rule, 87 FR 47875, we described the subject and the issues 
involved in how OCR will analyze claims of discriminatory benefit 
design by specifically stating that we acknowledged the unique nature 
of these products as being exempt from the Federal consumer protections 
and market reform requirements applicable to comprehensive coverage, 
and discussed how OCR proposes to investigate such plans by considering 
the nature, scope, and contours of the specific plan at issue and 
evaluating on a case-by-case basis an alleged discriminatory design 
feature in light of the entity's stated coverage parameters.\253\ We 
also reiterated that covered entities have the opportunity to 
articulate a legitimate, nondiscriminatory basis for their challenged 
action or practice. As discussed throughout this section and in the 
Proposed Rule, OCR's analysis for investigating a potentially 
discriminatory benefit design--as well as for all OCR investigations--
is necessarily a fact-specific, case-by-case analysis. This is true for 
allegations related to benefit design features in all plans, including 
major medical coverage as well as excepted benefits.
---------------------------------------------------------------------------

    \253\ Cf. Easley by Easley v. Snider, 36 F.3d 297, 301-05 (3d 
Cir. 1994) (examining the ``essential nature of the program'' as 
intended by the state when determining that a state's Attendant Care 
Program did not discriminate against individuals with mental 
disabilities under the ADA by excluding adults with disabilities who 
were not mentally alert).
---------------------------------------------------------------------------

    Comment: Some commenters raised concerns specific to Medicare 
supplemental health insurance (known as ``Medigap''), which is an 
excepted benefit, and requested that the rule not apply to such plans.
    Commenters argued that applying section 1557 to Medigap plans would 
be inconsistent with Congress's intent and the interlocking Federal-
State regulatory framework set forth by Congress. A commenter noted 
that when Congress wants to alter this regulatory scheme, it speaks 
clearly,\254\ and because Congress made no such specific reference to 
Medigap when enacting section 1557, Congress intended Medigap to be 
beyond the scope of section 1557. Commenters discussed that Medigap is 
highly standardized coverage comprehensively regulated under both 
Federal and State law over which issuers have little discretion with 
respect to plan benefit design.\255\ Commenters explained that Federal 
law prescribes ten different types of Medigap benefit packages, with 
each offering a different set of standardized benefits.\256\ Commenters 
noted that Congress established a Federal-State regulatory framework 
that prescribes the benefits, eligibility, and rating methodologies 
permissible for Medigap plans, with States establishing State-specific 
requirements for Medigap policies sold in their State. For example, a 
commenter noted that State laws may regulate Medigap plans in several 
ways, such as premium rating based on age, sex/gender, or medical 
underwriting, with some states requiring sex/gender rating; Medigap 
eligibility criteria based on an individual's age, disability, or end-
stage renal disease, with some States specifying that Medigap plans are 
not available to such individuals; and State-specific standardized 
Medigap plans over which issuers have no control with respect to 
benefit design, communications, or other factors.
---------------------------------------------------------------------------

    \254\ For example, the commenter noted that Congress revised the 
Medigap statute when it wanted to expressly apply section 104 of the 
Genetic Information Nondiscrimination Act to Medigap. Public Law 
100-360, 102 Stat. 683, sec. 221 (1988) (codified in 42 U.S.C. 
1395ss).
    \255\ See 42 U.S.C. 1395ss, 42 CFR 403.200 through 403.258; see 
also Nat'l Ass'n of Ins. Comm'rs, NAIC Model Regulation to Implement 
the NAIC Medicare Supplement Insurance Minimum Standards Model Act, 
MO-651-1 (2022), https://content.naic.org/sites/default/files/model-law-651.pdf.
    \256\ See 42 U.S.C. 1395ss. See also U.S. Dep't of Health & Hum. 
Servs., Ctrs. for Medicare & Medicaid Servs., Choosing a Medigap 
Policy: A Guide to Health Insurance for People with Medicare, 11 
(2023), https://www.medicare.gov/publications/02110-medigap-guide-health-insurance.pdf.
---------------------------------------------------------------------------

    Commenters stated that Medigap is commonly underwritten after an 
initial open enrollment period to prevent adverse selection, and that 
Medigap

[[Page 37623]]

issuers are generally limited to competing along two dimensions: price 
and customer service.\257\ Commenters argued that subjecting Medigap to 
section 1557 could result in adverse selection that could force covered 
issuers to leave the Medigap market, resulting in reduced consumer 
choice, higher Medigap premiums, and lower quality of service for 
seniors.
---------------------------------------------------------------------------

    \257\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Medigap (Medicare Supplement Health Insurance), 
https://www.cms.gov/Medicare/Health-Plans/Medigap (stating that 
``the only difference between medigap policies sold by different 
insurance companies is the cost.'').
---------------------------------------------------------------------------

    If the final rule does not exclude Medigap from section 1557, 
commenters requested at minimum that the rule specify that covered 
issuers are not responsible for possible discriminatory benefit 
designs, decisions, or actions that are a result of complying with a 
Federal or State requirement, including State-approved commercial 
underwriting practices.
    Response: OCR appreciates the concerns raised by commenters about 
Medigap, which is a statutorily defined excepted benefit.\258\ Medigap 
is a type of private supplemental health insurance coverage designed to 
cover cost-sharing gaps in original Medicare, such as deductibles, 
coinsurance, and copayments.\259\ Medigap is regulated by both Federal 
and State law. 42 U.S.C. 1395ss. Congress standardized Medigap plans to 
establish standard plan designs.\260\ While the plan benefits are 
standardized, the premiums and availability of the plans may vary by 
issuer depending on Federal and State law requirements. Medigap plans 
are statutorily prohibited from medical underwriting based on health 
status or imposing preexisting condition exclusions under certain 
circumstances, including during a six-month Medigap open enrollment 
period that begins when an individual turns 65 and enrolls in Medicare 
Part B and other specific times when guaranteed issue rights are 
available, 42 U.S.C. 1395ss(s), after which they are generally not 
prohibited from such practices under Federal law. States may enact 
their own State-specific requirements on Medigap, including whether the 
plans are guaranteed issue and whether the premiums may be rated based 
on age, health status, sex, or other factors.\261\ In addition, while 
there generally is no Federal Medigap open enrollment period during 
which time Medigap plans must be sold to individuals with disabilities 
under the age of 65, some States may require it.\262\
---------------------------------------------------------------------------

    \258\ Referred to as ``Medicare supplemental health insurance'' 
under 42 U.S.C. 300gg-91(c)(4); 45 CFR 144.103, 146.145(b)(5), and 
148.220(b)(5).
    \259\ Cong. Rsch. Serv., R47552, Medigap: Background and 
Statistics, 2 (2023), https://sgp.fas.org/crs/misc/R47552.pdf.
    \260\ Omnibus Budget Reconciliation Act of 1990, H.R. 5835, Pub. 
L. 101-508, pt. 5, Nov. 5, 1990, 104 Stat. 1388, https://www.congress.gov/bill/101st-congress/house-bill/5835. See also Cong. 
Rsch. Serv., R47552, Medigap: Background and Statistics, 5-7 (2023), 
https://sgp.fas.org/crs/misc/R47552.pdf.
    \261\ See, e.g., Cristina Boccuti et al., Kaiser Family Found., 
Medigap Enrollment and Consumer Protections Vary Across States, pp. 
8-13 (2018), https://files.kff.org/attachment/Issue-Brief-Medigap-Enrollment-and-Consumer-Protections-Vary-Across-States.
    \262\ See 42 U.S.C. 1395ss(s)(2)(A). See also Cong. Rsch. Serv., 
R47552, Medigap: Background and Statistics, 3 (2023), https://sgp.fas.org/crs/misc/R47552.pdf.
---------------------------------------------------------------------------

    Like other excepted benefits, Medigap is not designed to serve as 
comprehensive coverage and does not receive Federal financial 
assistance. As an excepted benefit, Medigap plans would be subject to 
the rule in the same fashion as other excepted benefits: if a Medigap 
plan is offered by a recipient health insurance issuer that is 
principally engaged in the provision or administration of health 
insurance coverage or other health-related coverage as specified under 
the definition of ``health program or activity'' in Sec.  92.4, the 
Medigap plan would be subject to the rule as part of the issuer's 
operations.
    That said, we acknowledge commenters' concerns about State law 
requirements that might result in benefit design features that could 
violate section 1557. When investigating a discriminatory design 
feature in a Medigap plan, OCR will evaluate the covered entity's 
legitimate, nondiscriminatory reason for the challenged feature. If the 
reason is based on a Federal or State law requirement, OCR will take 
this information into account when evaluating the context of the 
challenged design feature and will work with the covered entity to 
achieve compliance to help ensure that issuers do not leave the Medigap 
market or lower quality of products for consumers; however, section 
1557 would preempt a State law Medigap requirement--or any other 
excepted benefit requirement--that compelled conduct prohibited by 
section 1557 as applied to a recipient health insurance issuer subject 
to section 1557.
    Comment: Many commenters supported the Proposed Rule's application 
to STLDI as part of a principally engaged covered entity's operations. 
Commenters argued that the proposed broad application is crucial to 
protect against discrimination in these products.
    Commenters stated that STLDI plans are marketed, often misleadingly 
and fraudulently, as an alternative to comprehensive coverage, but have 
significant gaps that lead to high out-of-pocket costs and little 
financial protection for consumers.\263\ Commenters stated that STLDI 
plans are under-regulated and use a lax regulatory environment to 
market and sell products that can harm individuals, especially those 
with complex health needs. For example, a commenter stated that a 
person with cancer would pay anywhere from $23,000 to $100,000 in out-
of-pocket expenses during the first six months following diagnosis 
under an STLDI plan.\264\
---------------------------------------------------------------------------

    \263\ See, e.g., Sabrina Corlette et al., Urban Inst., The 
Marketing of Short-Term Health Plans: An Assessment of Industry 
Practices and State Regulatory Responses (2019), https://www.urban.org/sites/default/files/publication/99708/moni_stldi_final_0.pdf.
    \264\ See, e.g., Gabriela Dieguez & Dane Hansen, Milliman, The 
Impact of Short-Term Limited-Duration Policy Expansion on Patients 
and the ACA Individual Market, p. 13 (2020), https://www.lls.org/sites/default/files/National/USA/Pdf/STLD-Impact-Report-Final-Public.pdf.
---------------------------------------------------------------------------

    Commenters discussed that STLDI plans charge higher prices based on 
an applicant's age, sex, or disability and exclude or severely limit 
coverage for benefits related to preexisting conditions, prescription 
medications, mental health, and preventive services for women, 
contraception, and maternity care, all of which adversely impact 
individuals with disabilities, women, and individuals who are or who 
may become pregnant.\265\ Commenters suggested that the plans appear to 
be designed to discourage enrolling women of child-bearing age and that 
one study revealed that all plans reviewed discriminated against women 
through various practices, including gender rating and coverage 
exclusions.\266\ Commenters stated that including

[[Page 37624]]

coverage under section 1557 for these plans is particularly important 
for individuals with disabilities, including those with HIV, hepatitis, 
and mental health and substance use disorder disabilities who are 
harmed by discriminatory practices, such as including more frequent 
application of prior authorization and fail-first protocols and denials 
of medically necessary services.
---------------------------------------------------------------------------

    \265\ See, e.g., H.R. Comm. on Energy & Com., 116th Cong., 
Shortchanged: How the Trump Administration's Expansion of Junk 
Short-Term Health Insurance Plans is Putting Americans at Risk 
(2020), https://drive.google.com/file/d/1uiL3Bi9XV0mYnxpyaIMeg_Q-BJaURXX3/view; Dania Palanker & Emily Curran, Commonwealth Fund, 
Limitations of Short-Term Health Plans Persist Despite Predictions 
That They'd Evolve (2020), https://www.commonwealthfund.org/blog/2020/limitations-short-term-health-plans-persist-despite-predictions-theyd-evolve; JoAnn Volk et al., Commonwealth Fund, 
Trump Administration Promotes Coverage That Fails to Adequately 
Cover Women's Key Health Care Needs (2020), https://www.commonwealthfund.org/blog/2020/trump-administration-promotes-coverage-that-fails-to-cover-womens-key-health-care-needs.
    \266\ H.R. Comm. on Energy & Com., 116th Cong., Shortchanged: 
How the Trump Administration's Expansion of Junk Short-Term Health 
Insurance Plans is Putting Americans at Risk, 61, 74 (2020), https://drive.google.com/file/d/1uiL3Bi9XV0mYnxpyaIMeg_Q-BJaURXX3/view.
---------------------------------------------------------------------------

    Because STLDI plans are not subject to traditional oversight of 
their provider networks, commenters stated that the plans may be 
designed in a way that limits care for LGBTQI+ people, individuals with 
disabilities, older individuals, individuals with LEP, or people of 
color.\267\ In addition, commenters observed that STLDI plans 
retroactively cancel coverage and are not guaranteed renewable, leaving 
people with serious health conditions without coverage and often unable 
to enroll if the denial occurred outside of an ACA open enrollment 
period.\268\
---------------------------------------------------------------------------

    \267\ See, e.g., H.R. Comm. on Energy & Com., 116th Cong., 
Shortchanged: How the Trump Administration's Expansion of Junk 
Short-Term Health Insurance Plans is Putting Americans at Risk 
(2020), https://drive.google.com/file/d/1uiL3Bi9XV0mYnxpyaIMeg_Q-BJaURXX3/view.
    \268\ See, e.g., Gabriela Dieguez & Dane Hansen, Milliman, The 
Impact of Short-Term Limited-Duration Policy Expansion on Patients 
and the ACA Individual Market, p. 11 (2020), https://www.lls.org/sites/default/files/National/USA/Pdf/STLD-Impact-Report-Final-Public.pdf.
---------------------------------------------------------------------------

    One insurance industry commenter raised detailed concerns about 
applying the rule to STDLI in its discussion opposing the rule's 
application to excepted benefits. The commenter argued that similar to 
arguments above regarding excepted benefits, Congress excluded these 
products from most of the ACA's requirements and that applying the rule 
to these products would create a competitive disadvantage for covered 
entities that must comply with section 1557 as compared to non-
recipient competitors that can offer lower-cost coverage due to the 
ability to vary premium rates on the basis of factors otherwise 
prohibited under section 1557 or exclude higher cost benefits. The 
commenter also argued recipients would be subject to greater costs due 
to compliance with section 1557's procedural requirements.
    Response: OCR appreciates commenters' support and shares the 
concerns raised by commenters about the misleading and deceptive 
practices of some issuers of STLDI plans. STLDI is excluded from the 
definition of ``individual health insurance coverage'' under the PHS 
Act.\269\ As a result, it is generally exempt from the Federal consumer 
protections and market reform requirements applicable to comprehensive 
coverage offered in the individual market, such as the prohibition on 
discrimination based on health status, 42 U.S.C. 300gg-4, the 
prohibition of preexisting condition exclusions, 42 U.S.C. 300gg-3, and 
the prohibition on lifetime and annual dollar limits on EHB, 42 U.S.C 
300gg-11, among others. These plans were traditionally not designed to 
serve as comprehensive coverage and were intended to fill temporary 
coverage gaps when an individual was transitioning between 
comprehensive coverages. See 81 FR 38020, 38032 (June 10, 2016).\270\
---------------------------------------------------------------------------

    \269\ 42 U.S.C. 300gg-91(b)(5) defines ``individual health 
insurance coverage'' to mean ``health insurance coverage offered to 
individuals in the individual market, but does not include short-
term limited duration insurance.'' (Emphasis added.)
    \270\ See also, U.S. Dep't of Health & Hum. Servs., Short-Term 
Limited Duration Insurance: Independent, Noncoordinated Excepted 
Benefits Coverage; Level-Funded Plan Arrangements; and Tax Treatment 
of Certain Accident and Health Insurance, Proposed Rule, 88 FR 44596 
(July 12, 2023) (proposing to narrow the definition of ``short-term 
limited duration insurance'' to mean health insurance coverage that 
has an expiration date that is ``no more than 3 months after the 
original effective date of the policy, certificate, or contract of 
insurance, and taking into account any renewals or extensions, has a 
duration no longer than 4 months in total''.)
---------------------------------------------------------------------------

    OCR acknowledges the commenter's concerns about competitive 
disadvantage and compliance costs. However, as discussed previously, 
the risk of competitive disadvantage is low given that the majority of 
health insurance issuers offer some type of product that receives 
Federal financial assistance, and by accepting the benefit of Federal 
funds, a recipient is prohibited from discriminating in its health 
programs and activities under section 1557. For the same reasons set 
forth above explaining why this rule applies to a principally engaged 
recipient issuer's excepted benefits, STLDI would be covered under this 
final rule as part of a recipient issuer's operations if the issuer is 
principally engaged as set forth in the definition of ``health program 
or activity'' at Sec.  92.4. That Congress excluded STLDI from the PHS 
Act definition of individual health insurance coverage does not exclude 
such coverage from section 1557. Congress could have but did not extend 
the exemption for these products to section 1557. section 1557 applies 
to ``health programs or activities'' and contains no exceptions for 
certain types of plans or coverage, nor is it limited to plans or 
coverage that are subject to other provisions in the ACA. OCR therefore 
maintains that this rule's interpretation and application to all 
operations of a recipient health insurance issuer when principally 
engaged, including an issuer's products, is the best reading of the 
section 1557 statutory language, which applies to ``any health program 
or activity, any part of which is receiving Federal financial 
assistance.'' 42 U.S.C. 18116(a) (emphasis added).
Application to Third Party Administrators
    In the Proposed Rule, we discussed that an issuer's or other 
entity's operations related to third party administrative services also 
would be subject to the rule when the issuer receives Federal financial 
assistance and is deemed to be principally engaged in the provision or 
administration of health insurance coverage or other health-related 
coverage as set forth in the definition of ``health program or 
activity'' under Sec.  92.4. 87 FR 47876-77. We stated that we will 
engage in a fact-specific analysis to evaluate whether a third party 
administrator is appropriately covered under section 1557 as a 
recipient of Federal financial assistance in circumstances where the 
third party administrator is legally separate from the issuer that 
receives Federal financial assistance.
    When investigating complaints relating to third party 
administrators that are appropriately covered under section 1557, we 
stated that OCR will determine whether responsibility for the decision 
or alleged discriminatory action lies with the plan sponsor or with the 
covered third party administrator. Where the alleged discrimination 
relates to the administration of the plan by a covered third party 
administrator, we stated that OCR will process the complaint against 
the third party administrator because it is the entity responsible for 
the decision or other action being challenged in the complaint. We also 
stated that OCR will pursue claims against the covered third party 
administrator in circumstances where the third party administrator is 
the entity responsible for developing the discriminatory benefit design 
feature that was adopted by the employer. Where the alleged 
discrimination relates to the benefit design of self-insured group 
health plan coverage that did not originate with the third party 
administrator, but rather with the plan sponsor, OCR will refer the 
complaint to the Equal Employment Opportunity Commission (EEOC) or DOJ 
for potential investigation. We discussed that we would refer 
complaints related to the Federal Employees Health Benefits (FEHB) 
Program, the Federal Employees Dental and Vision Insurance Program 
(FEDVIP), or the Federal Long Term

[[Page 37625]]

Care Insurance Program (FLTCIP) to the Office of Personnel Management 
(OPM).
    The comments and our responses regarding coverage of third party 
administrator activities are set forth below.
    Comment: Several commenters supported the rule's application to 
third party administrators as part of the operations of a principally 
engaged recipient health insurance issuer. Commenters stated that 
issuers often serve as third party administrators and the rule's 
application to an issuer's third party administrator activities will 
help achieve health equity, improve health outcomes, and ensure that 
all individuals can access health care without unnecessary barriers. 
Commenters stated that third party administrators play an outsized role 
in administering and designing health coverage for millions of people 
enrolled in self-funded employer group health plan coverage,\271\ which 
may contain discriminatory provisions prohibited by section 1557.\272\ 
Commenters discussed how third party administrators do more than simply 
process claims. These commenters stated that, similar to issuers, third 
party administrators make significant decisions about critical health 
plan features and often design benefits, formularies, payment 
structures, and networks; conduct prior authorization; and establish 
and evaluate other clinical coverage criteria. One commenter stated 
that third party administrators rely on their own clinical criteria, 
which may result in discriminatory denials of coverage despite the plan 
providing coverage generally. For example, the commenter discussed that 
where a self-funded plan might provide coverage for gender-affirming 
care, the third party administrator might rely on its own clinical 
criteria to categorically exclude coverage for certain types of gender-
affirming care.
---------------------------------------------------------------------------

    \271\ Commenters noted that 64 percent of workers in the United 
States receive health coverage through self-insured employer plans. 
Gary Claxton et al., Kaiser Family Found., Employer Health Benefits 
2021 Annual Survey, p. 9 (2021), https://files.kff.org/attachment/Report-Employer-Health-Benefits-2021-Annual-Survey.pdf.
    \272\ See, e.g., Anna Kirkland et al., Transition Coverage and 
Clarity in Self-Insured Corporate Health Insurance Benefit Plans, 6 
Transgender Health 4, 214 (2021), https://www.liebertpub.com/doi/full/10.1089/trgh.2020.0067 (showing that employer plans had three 
times as many categorical exclusions for gender-affirming health 
care).
---------------------------------------------------------------------------

    Other commenters opposed the rule covering third party 
administrators. These commenters argued the rule should exclude third 
party administrators from the scope of the final rule and that section 
1557's application should not extend beyond the legal entity that 
provides or offers the ``health program or activity.'' Several 
commenters argued that the rule's coverage of third party 
administrators would create an unlevel playing field and result in a 
competitive disadvantage for health insurance issuers that accept 
Federal financial assistance. For example, commenters argued the 
administrative costs of complying with section 1557, such as the 
nondiscrimination notice requirements, would place covered third party 
administrators at a competitive disadvantage with non-covered third 
party administrators that are not subject to the same requirements. 
Commenters asserted that third party administrators generally do not 
receive Federal financial assistance and argued that applying section 
1557 to third party administrators would result in subjecting all their 
clients to section 1557's requirements when neither the client nor the 
third party administrator receives Federal financial assistance. 
Commenters argued this would create a disincentive for clients to 
engage a third party administrator that is subject to section 1557 and 
so would create an unlevel playing field between third party 
administrators covered by section 1557 and those that are not. 
Commenters further suggested this could result in entities deciding not 
to participate in federally funded or conducted programs, such as the 
Exchanges.
    One commenter asserted OCR did not explain the need for this 
proposed change from the 2020 Rule, which does not cover an issuer's 
third party administrator activities, and that the uncertainty of how 
the rule will apply to covered third party administrators would likely 
result in higher third party administrator charges to employers, which 
would be passed through to enrollees.
    Response: We appreciate the diversity of comments received on our 
proposal to apply section 1557 to third party administrators when 
certain criteria are met. The final rule applies to all the operations 
of a recipient principally engaged in the provision or administration 
of health insurance coverage or other health-related coverage, 
including its third party administrator activities, as discussed in 
detail previously under the definition of ``health program or 
activity'' under Sec.  92.4. This position is also supported by a 
decision of the District Court for the Western District of Washington, 
which held that third party administrators operated by health insurance 
issuers are subject to section 1557 even if the third party 
administrators do not receive Federal financial assistance.\273\ In 
addition, a third party administrator could be covered under the rule 
if it is a subrecipient of Federal financial assistance. We also note 
that where a third party administrator is not covered under section 
1557, a covered entity that contracts with a third party administrator, 
such as a health insurance issuer or group health plan, may be liable 
for the third party administrator's actions as a subcontractor. Please 
see the earlier discussion on subrecipients and contractors in the 
sections on Application, Sec.  92.2, and the definition of ``Federal 
financial assistance,'' Sec.  92.4.
---------------------------------------------------------------------------

    \273\ See C. P. by & through Pritchard v. Blue Cross Blue Shield 
of Ill., No. 3:20-CV-06145-RJB, 2022 WL 17788148, at *8 (W.D. Wash. 
Dec. 19, 2022).
---------------------------------------------------------------------------

    We acknowledge commenters' concerns that this may result in a 
competitive disadvantage for health insurance issuers that accept 
Federal financial assistance. This argument, however, is not unique to 
health insurance issuers or their third party administrator activities. 
Any covered entity that accepts Federal funding from the Department 
knowingly agrees to comply with section 1557 and other civil rights 
laws that apply to recipients of Federal financial assistance.
    Comment: Some commenters were opposed to the rule holding a third 
party administrator liable for plan benefit designs even if the 
discriminatory terms originated with the third party administrator. 
Commenters stated this approach was inconsistent with the 2016 Rule's 
approach that a third party administrator was liable only where the 
third party administrator was ``responsible for the decision or action 
. . . as the decision-making entity.'' 81 FR 31432. These commenters 
requested that OCR clarify that a third party administrator will be 
held responsible for actions only when it is the entity that controls 
whether or not the action must be taken. Commenters argued that third 
party administrators should not be liable for plan benefit designs 
simply because a third party administrator suggested or helped develop 
the benefit design ultimately chosen by the group health plan because 
the third party administrator is not the decision-making entity that 
adopted the benefit design. Accordingly, commenters argued that third 
party administrators should not be held responsible for administering 
benefits based on benefit design decisions made solely by a plan 
sponsor and urged OCR to clarify that the rule will not apply to third 
party

[[Page 37626]]

administrators in cases where a plan sponsor adopts a potentially 
discriminatory plan design that the third party administrator played no 
role in selecting.
    Commenters also noted that, under ERISA, third party administrators 
generally must administer self-insured plans according to the plans' 
terms. 29 U.S.C. 1104(a)(1)(D). These commenters asserted that a third 
party administrator should not be liable for the benefit design of a 
plan, including utilization management techniques, when it is 
administering the plan consistent with the plan terms as adopted by the 
group health plan or plan sponsor. Otherwise, commenters argued, the 
rule would effectively hold a third party administrator responsible for 
decisions made by another entity, namely, the plan's named fiduciary or 
plan administrator. Commenters further stated that ERISA does not 
require the third party administrator to be responsible for plan terms, 
but does require the plan sponsor to have a ``named fiduciary'' that 
has ultimate control over the plan's operation.\274\ A commenter argued 
it would be unreasonable for OCR to take the position that a third 
party administrator is legally obligated under section 1557 to violate 
its obligation under ERISA to honor its contract with the plan sponsor 
and honor the plan's terms.
---------------------------------------------------------------------------

    \274\ See, e.g., Dep't of Labor, Meeting Your Fiduciary 
Responsibilities (2021), https://www.dol.gov/node/63375.
---------------------------------------------------------------------------

    Commenters also argued that covering third party administrators is 
contrary to Congressional intent. Commenters stated that under ERISA, 
Congress made the group health plan responsible for the benefits it 
chooses to provide, and that OCR should not shift that responsibility 
to third party administrators through section 1557. These commenters 
argued that had Congress intended for third party administrators to be 
subject to section 1557, it would have said so clearly.
    In contrast, several commenters expressed support for the rule that 
would make a covered third party administrator liable when the 
discriminatory plan feature originated with the third party 
administrator. These commenters asserted that third party 
administrators cannot insulate themselves from liability by arguing 
that ERISA requires a group health plan to be administered according to 
its terms (including by a third party administrator contracted by a 
plan sponsor). ERISA, commenters noted, does not exempt group health 
plans or their service providers (including third party administrators) 
from complying with other Federal laws, like section 1557.\275\ These 
commenters, citing to case law,\276\ argued that third party 
administrators should be held liable under section 1557 for 
discriminatory plan administration and when discriminatory plan terms 
originate with the third party administrator, even when the plan 
sponsor subsequently adopts the plan designed by the third party 
administrator and maintains control over its terms. Commenters noted 
that many large health insurance issuers design and market self-funded 
plans to plan sponsors and contract to serve as third party 
administrators.\277\ Commenters noted that third party administrators 
are largely responsible for designing plans except for those offered by 
the most sophisticated employers. Commenters stated that issuers 
administer the self-funded plans using the same coverage policies that 
they use in their fully insured plans, and therefore the discriminatory 
terms in self-funded plans are often directly traceable to and 
redressable by third party administrators.
---------------------------------------------------------------------------

    \275\ See 29 U.S.C. 1144(d) (``Nothing in this subchapter shall 
be construed to alter, amend, modify, invalidate, impair, or 
supersede any law of the United States . . . .'').
    \276\ Tovar v. Essentia Health, 857 F.3d 771, 778 (8th Cir. 
2017).
    \277\ Blue Cross Blue Shield of N.D., Self-Funding, Alternative 
Financial Arrangements for Group Benefit Plans, p. 1 (2019), https://www.bcbsnd.com/content/dam/bcbsnd/documents/brochures/employers/29300143_BND-Self-Funding-Brochure.pdf (``Groups with 26 or more 
employees enrolled have a choice of several standard design plan 
options available. There is additional flexibility for custom 
designed benefit plans for groups with more than 50 employees 
enrolled.''); UnitedHealthcare, UMR, https://www.uhc.com/employer/employer-resources/umr (stating UMR, UnitedHealthcare's third party 
administrator, ``serve[s] over 5 million members with custom plan 
designs, cost-containment solutions and innovative services'').
---------------------------------------------------------------------------

    Some commenters suggested that third party administrators should be 
liable for administering a plan with discriminatory benefit design 
features even when the plan design did not originate with the third 
party administrator. Commenters argued that third party administrators 
that agree to administer discriminatory plans play a role in 
discriminating against protected individuals and should not be given 
immunity when administering plans with discriminatory designs.
    Response: OCR carefully considered the variety of views expressed 
by commenters relating to the liability of a third party administrator 
covered under this rule. We agree with commenters that a third party 
administrator should not be held responsible for discriminatory plan 
design features over which the third party administrator exercised no 
control.
    We disagree with commenters that believe a covered third party 
administrator should not be liable for discriminatory benefit design 
features that originated with the third party administrator simply 
because the plan sponsor is ultimately the entity responsible under 
ERISA for adopting the plan and maintaining control over its terms. Our 
interpretation is consistent with case law, which has held that a third 
party administrator may be liable for discriminatory plan terms that 
originated with the third party administrator, notwithstanding the fact 
that the plan sponsor subsequently adopted the plan and maintained 
control over the terms.\278\ Further, as commenters noted, health 
insurance issuers operating as third party administrators often design 
the plans that they offer to self-insured group health plans and offer 
standard plan design options, often to small and midsize employers 
while only offering flexibility in the plan design to larger 
employers.\279\
---------------------------------------------------------------------------

    \278\ See, e.g. Tovar v. Essentia Health, 857 F.3d 771, 778 (8th 
Cir. 2017) (concluding that enrollee in a self-insured employer-
sponsored plan could establish Article III standing for a claim of 
discrimination under section 1557 to sue a third party administrator 
where ``the plan and its allegedly discriminatory terms originated 
with [the third party administrator]--not with [the employer],'' and 
if the third party administrator provided the employer ``with a 
discriminatory plan document, . . . notwithstanding the fact that 
[the employer] subsequently adopted the plan and maintained control 
over its terms''); C. P. by & through Pritchard v. Blue Cross Blue 
Shield of Ill., No. 3:20-CV-06145-RJB, 2022 WL 17788148, at *7, *9 
(W.D. Wash. Dec. 19, 2022) (holding that ``third party 
administrators can be liable under Section 1557 based on 
discriminatory terms in a self-funded plan even if the third party 
administrator provided the plan document `notwithstanding the fact 
that the [plan sponsor] subsequently adopted the plan and maintained 
control over its terms''' (quoting Tovar, 857 F.3d at 778)); Tovar 
v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. Minn. 2018) 
(holding that a third party administrator may be liable under 
section 1557 for damages arising from discriminatory terms in a 
self-insured, employer-sponsored health plan where the harm suffered 
``was proximately caused by [the third party administrator's] 
designing and providing to [the self-insured plan] the 
discriminatory provisions in the plan'').
    \279\ See, e.g., Blue Cross Blue Shield of N.D., Self-Funding, 
Alternative Financial Arrangements for Group Benefit Plans, p. 1 
(2019), https://www.bcbsnd.com/content/dam/bcbsnd/documents/brochures/employers/29300143_BND-Self-Funding-Brochure.pdf (``Groups 
with 26 or more employees enrolled have a choice of several standard 
design plan options available. There is additional flexibility for 
custom designed benefit plans for groups with more than 50 employees 
enrolled.'').
---------------------------------------------------------------------------

    We recognize that ERISA requires group health plans to be 
administered consistent with the terms governing the plan, as long as 
the terms are consistent with the provisions of the same

[[Page 37627]]

subchapter in ERISA.\280\ ERISA then provides in the same subchapter 
that it is not to be construed to impair or supersede other Federal 
laws, including regulations issued under such laws.\281\ This rationale 
finds support in the cases that have held that ERISA's requirement that 
a plan's terms must be administered as written must not be construed to 
invalidate or impair section 1557.\282\
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    \280\ 29 U.S.C. 1104(a)(1)(D) (``[A] fiduciary shall discharge 
his duties with respect to a plan solely in the interest of the 
participants and beneficiaries and . . . in accordance with the 
documents and instruments governing the plan insofar as such 
documents and instruments are consistent with the provisions of this 
subchapter and subchapter III.'' (emphasis added)).
    \281\ 29 U.S.C. 1144(d) (``Nothing in this subchapter shall be 
construed to alter, amend, modify, invalidate, impair, or supersede 
any law of the United States (except as provided in sections 1031 
and 1137(b) of this title) or any rule or regulation issued under 
any such law.'').
    \282\ See, e.g., C. P. by & through Pritchard v. Blue Cross Blue 
Shield of Ill., No. 3:20-CV-06145-RJB, 2022 WL 17788148, at *8, 10 
(W.D. Wash. Dec. 19, 2022) (holding that ERISA's requirement at 29 
U.S.C. 1104(a)(1)(D) to administer a plan's terms as written ``is 
subservient to Section 1557, outlawing discrimination, which is 
dominant''); Tovar v. Essentia Health, 342 F. Supp. 3d 947, 954 (D. 
Minn. 2018) (``The Court will not construe ERISA to impair Section 
1557. Nothing in Section 1557, explicitly or implicitly, suggests 
that TPAs are exempt from the statute's nondiscrimination 
requirements.'').
---------------------------------------------------------------------------

    For these reasons, we affirm our general approach as discussed in 
the Proposed Rule at 87 FR 47876-77. When OCR investigates a 
potentially discriminatory action or plan design related to a self-
insured group health plan coverage administered by a covered entity 
acting as a third party administrator, OCR will take into account the 
party responsible for the alleged discriminatory conduct. Recognizing 
that third party administrators might not be responsible for the 
benefit designs of the self-insured group health plan coverage that 
they administer, OCR does not intend to enforce this rule against a 
third party administrator for a plan design that it did not design and 
over which it has no control. Where the discriminatory terms of the 
plan originated with the covered third party administrator rather than 
with the plan sponsor, the third party administrator could be liable 
for the discriminatory design feature under section 1557.
    Accordingly, when analyzing a claim against a covered third party 
administrator, OCR will determine whether responsibility for the 
decision or alleged discriminatory action lies with the third party 
administrator, group health plan, or the plan sponsor. Where the 
alleged discrimination relates to the administration of the plan by a 
covered third party administrator, OCR will process the complaint 
against the covered third party administrator because it is the entity 
responsible for the decision or other action being challenged. For 
example, if a covered third party administrator applies a plan's 
neutral, nondiscriminatory utilization management guidelines in a 
discriminatory way against an enrollee, OCR will proceed against the 
covered third party administrator as the entity responsible for the 
decision. In addition, OCR will pursue claims against a covered third 
party administrator in circumstances where the third party 
administrator is the entity responsible for developing the 
discriminatory benefit design feature that was adopted by the employer. 
For instance, if a covered third party administrator develops standard 
plan designs that it offers to employers, the covered third party 
administrator is liable for any discriminatory design feature in the 
plans because the plans originated with the third party administrator. 
Where the alleged discrimination relates to the benefit design of self-
insured group health plan coverage that did not originate with the 
covered third party administrator, but rather with the plan sponsor or 
the group health plan, and where the third party administrator played 
no role in the development of the plan's benefit design, OCR will refer 
the complaint to the EEOC or DOJ for potential investigation.
    As discussed in the Proposed Rule at 87 FR 47877, as part of OCR's 
enforcement authority, OCR has the option of referring or transferring 
matters to other Federal agencies with jurisdiction over the entity. 
Accordingly, OCR will transfer matters to the EEOC or DOJ where OCR 
lacks jurisdiction over an employer responsible for the benefit design 
of employer-sponsored group health plan coverage. OCR will refer to OPM 
complaints alleging discrimination in the FEHB Program (including the 
Postal Service Health Benefits Program), FEDVIP, and FLTCIP. This Rule 
does not determine how or whether any other agency will investigate or 
enforce any matter referred or transferred by OCR.
    As part of OCR's analysis, we will also engage in a fact-specific 
inquiry to evaluate whether a third party administrator is 
appropriately covered under section 1557 in circumstances where the 
third party administrator is legally separate from the issuer that 
receives Federal financial assistance, as discussed in more detail 
below.
    Comment: Commenters requested that OCR provide additional clarity 
on the circumstances under which OCR would hold a third party 
administrator liable under the rule. Commenters stated that plan 
sponsors and third party administrators may place blame on each other 
for the discriminatory features. Another commenter said that a self-
insured plan sponsor could direct a third party administrator on the 
goals or parameters of the design it seeks or refer the third party 
administrator to other plan designs and request that the third party 
administrator develop a plan design in accordance with those 
parameters. The commenter argued that in these cases, where the third 
party administrator is not the decision-making entity that ultimately 
controls and determines whether to implement the design or feature, it 
should not be liable under section 1557 for that design or feature.
    Response: If a third party administrator is a covered entity under 
section 1557, it is responsible for ensuring that its actions do not 
discriminate on the basis of race, color, national origin, sex, age, or 
disability. Where a covered third party administrator plays a role in 
designing benefits for self-insured group health plan coverage, it must 
not do so in a manner that results in discrimination on a prohibited 
basis. This is so even if the plan sponsor requests that the covered 
third party administrator develop a certain plan design that includes a 
discriminatory feature. For example, if a plan sponsor requested that a 
covered third party administrator develop a plan design that excluded 
all enrollees of a certain race, there would be no question that a 
third party administrator could not design such a plan without 
violating section 1557. This is true for any other discriminatory 
design feature that would violate section 1557. In these cases, while 
the plan sponsor may be the entity requesting the particular design 
feature for a group health plan, the covered third party administrator 
would still be liable as the entity that designed such a plan, 
notwithstanding the plan sponsor's request.
    Comment: Several commenters requested that OCR provide clarity on 
the rule's application to pharmacy benefit managers. Many commenters 
argued that pharmacy benefit managers, similar to third party 
administrators, make significant decisions about critical health plan 
features and should be liable when they are responsible for 
discriminatory formulary benefit designs. Commenters noted that plan 
sponsors often defer to the expertise of pharmacy benefit managers. 
Commenters opposed to the rule's application to third party 
administrators argued that pharmacy benefit managers similarly should 
not be liable under the

[[Page 37628]]

rule when a pharmacy benefit manager was not responsible for designing 
the plan benefits that were adopted by the plan sponsor, similar to 
their arguments above against holding third party administrators liable 
under the rule.
    Response: We discuss the rule's applicability to pharmacy benefit 
managers in the discussion under Sec.  92.4 regarding the definition of 
``health program or activity.'' Pharmacy benefit managers are health 
programs or activities and would be covered under the rule if they 
receive Federal financial assistance. A pharmacy benefit manager that 
does not directly receive Federal financial assistance would also be 
covered under the rule if it is part of the operations of a recipient 
that is principally engaged in the provision or administration of 
health-related services, health-related insurance coverage, or other 
health-related coverage, as set forth under the definition of ``health 
program or activity'' at Sec.  92.4.\283\
---------------------------------------------------------------------------

    \283\ See, e.g., Doe One v. CVS Pharmacy, Inc., No. 18-cv-01031-
EMC, slip op. at 12-23 (N.D. Cal., Aug. 5, 2022) (relying on section 
1557, the 2016 Rule, and the incorporated civil rights statutes to 
conclude that the complaint plausibly alleged that CVS Pharmacy, 
Inc. is principally engaged in the business of health care and all 
of its operations are covered by section 1557, including its 
pharmacy benefit managers Caremark, L.L.C. and Caremark PCS Health, 
L.L.C.).
---------------------------------------------------------------------------

    If a pharmacy benefit manager is subject to section 1557 as part of 
the operations of a principally engaged recipient, we agree with 
commenters that the pharmacy benefit manager's liability under the rule 
would be similar to that of a covered third party administrator. Both 
entities contract with other parties, such as issuers or sponsors of 
self-insured group health plan coverage, to administer health benefits 
to plan enrollees. They may design plan benefits, formularies, payment 
structures, networks, and conduct utilization management. Therefore, if 
OCR receives a complaint about a covered pharmacy benefit manager, OCR 
will evaluate the liability of the pharmacy benefit manager consistent 
with the analysis set forth above for third party administrators. That 
is, OCR will determine whether responsibility for the challenged action 
lies with the covered pharmacy benefit manager or the plan sponsor.
    Comment: One commenter requested that OCR clarify that 
administrative actions such as developing documents or preparing policy 
booklets for clients, alone, would not constitute third party 
administrator liability for discriminatory plan design features.
    Response: We affirm that such administrative actions would not 
violate this rule to the extent the covered third party administrator 
is merely relaying information to enrollees consistent with the 
underlying plan terms that the third party administrator played no role 
in developing.
    Comment: Some commenters requested that the rule clarify that an 
entity covered by section 1557 cannot outsource the implementation or 
design of discriminatory plans to entities that are not covered by the 
rule. Another commenter requested that OCR clarify that any third-party 
company may be liable under section 1557 when discriminatory plan terms 
originate with, or are managed by, the third-party company. For 
example, the commenter stated that third-party specialty benefits 
programs may promote or manage discriminatory specialty medication 
programs.
    Response: A covered entity that outsources the implementation or 
benefit design of discriminatory plans remains liable under this rule 
for any discriminatory plan terms. Under the discussion of the 
definition of ``Federal financial assistance'' in Sec.  92.4, we 
clarify that covered entities are responsible for the conduct of their 
subcontractors and cannot outsource or contract away their civil rights 
obligations by entering into contractual arrangements with 
subcontractors.
    A third-party company that develops or manages discriminatory plans 
on behalf of a covered entity would only be liable under section 1557 
to the extent the third-party company is a recipient or subrecipient of 
Federal financial assistance from the Department, including if the 
third party is part of a principally engaged recipient's operations.
    Comment: Commenters requested that OCR clarify when liability under 
section 1557 extends across affiliated companies. Some commenters 
expressed concern that third party administrators and pharmacy benefit 
managers would automatically be deemed to be covered entities under the 
rule solely because they are related to an entity that received Federal 
financial assistance. These commenters requested that the final rule 
provide the same clarification that was in the 2016 Rule to clarify 
that a third party administrator (or pharmacy benefit manager \284\) is 
unlikely to be covered under the rule where they are ``a legal entity 
that is truly independent of an issuer's other, federally funded, 
activities.'' 81 FR 31433.
---------------------------------------------------------------------------

    \284\ The 2016 Rule did not address pharmacy benefit managers.
---------------------------------------------------------------------------

    Other commenters expressed concern that third party administrators 
and pharmacy benefit managers could use complex corporate structures to 
distinguish separate lines of business to evade compliance with section 
1557.\285\ These commenters requested that OCR provide greater clarity 
on when liability under section 1557 extends across affiliated 
companies.
---------------------------------------------------------------------------

    \285\ Cf., Doe One v. CVS Pharmacy, Inc., No. 18-cv-01031-EMC, 
slip op. at 15 (N.D. Cal., Aug. 5, 2022) (``To ignore the overall 
interrelationship among the entities which, in the case at bar, 
design and implement the allegedly discriminatory program and permit 
the CVS interrelated entities to escape responsibility would exalt 
form over substance and impair the effectiveness of the anti-
discrimination provision of the ACA.'').
---------------------------------------------------------------------------

    Response: As discussed in the 2016 Rule, 81 FR 31433, OCR will 
conduct a case-by-case analysis to determine whether a third party 
administrator or pharmacy benefit manager is appropriately subject to 
section 1557 as part of the operations of a recipient covered entity in 
situations where the third party administrator or pharmacy benefit 
manager is legally separate from an issuer or other covered entity that 
receives Federal financial assistance. This fact-specific analysis will 
rely on principles developed in longstanding civil rights case law, 
such as the degree of interrelatedness between or among entities, 
including the degree of common ownership and control between or among 
entities.\286\ OCR will also examine whether the purpose of the legal 
separation was to avoid liability or avoid the application of civil 
rights law requirements--that is, whether it is intended to allow the 
entity to continue to administer discriminatory health insurance 
coverage or other health-related coverage.\287\ As indicated in the 
2016 Rule, a third party administrator or pharmacy benefit manager is 
unlikely to be covered by this final rule where it is a legal entity 
that is truly independent

[[Page 37629]]

of an issuer's other, federally funded activities. We also address 
subsidiary liability under the discussion of Sec.  92.4's definition of 
``health program or activity.''
---------------------------------------------------------------------------

    \286\ See, e.g., Papa v. Katy Indus., Inc., 166 F.3d 937, 939 
(7th Cir. 1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA); 
Arrowsmith v. Shelbourne, Inc., 69 F.3d 1235, 1240-42 (2d Cir. 1995) 
(title VII); Valesky v. Aquinas Acad., 2011 U.S. Dist. LEXIS 103791, 
No. 09-800 (W.D. Pa. Sept. 14, 2011) (title IX); Russo v Diocese of 
Greenberg, 2010 U.S. Dist. LEXIS 96338, No. 09-1169 (W.D. Pa. Sept. 
15, 2010) (title IX, section 504); Margeson v. Springfield Terminal 
Railway Co., 1993 U.S. Dist. LEXIS 12243, No. CIV.A. 91-11475-Z (D. 
Mass. Aug. 24, 1993) (section 504); See also Doe One v. CVS 
Pharmacy, Inc., No. 18-cv-01031-EMC, slip op. at 12-23 (N.D. Cal., 
Aug. 5, 2022) (relying on section 1557, the 2016 Rule, and the 
incorporated civil rights statutes to conclude that the complaint 
plausibly alleged that CVS Pharmacy, Inc. is principally engaged in 
the business of health care and all of its operations are covered by 
section 1557, including its pharmacy benefit managers Caremark, 
L.L.C. and Caremark PCS Health, L.L.C.)
    \287\ Papa v. Katy Indus., Inc., 166 F.3d 937, 941 (7th Cir. 
1999), cert. denied, 528 U.S. 1019 (1999) (ADA, ADEA).
---------------------------------------------------------------------------

    Comment: One commenter urged OCR to consider whether stop-loss 
coverage sold by a covered third party administrator to an employer 
results in discrimination on the basis of disability prohibited under 
section 1557. The commenter stated that stop-loss coverage uses 
techniques that target group members with high medical needs. The 
commenter asserted this could result in stop-loss coverage penalizing 
employers when a covered individual needs intensive treatment for a 
disabling condition.
    Response: Stop-loss insurance provides coverage for the benefit of 
the employers, plan sponsors, or group health plans to cover financial 
liability for such entities to provide protection against catastrophic 
or unpredictable losses, and does not provide coverage for individuals. 
Stop-loss insurance that does not discriminate against individuals on 
the grounds protected under section 1557 does not implicate this final 
rule.
    Comment: A few commenters expressed concern that the rule's 
application to covered third party administrators does not account for 
situations where the third party administrator is administering plans 
for religious employers. Commenters argued the rule could impose a 
burden on an employer's religious beliefs. Another commenter further 
argued that it could cause the employer to be exposed to liability for 
a claim of employment discrimination. The commenter explained that 
Sec.  92.207 prohibits covered entities, such as a covered third party 
administrator, from providing a health-coverage related product that 
aligns with the beliefs and practices of religious employers. The 
commenter argued this results in a burden on the employer's religion 
because such religious employers cannot obtain a health coverage-
related product that is illegal for covered entities to provide. If 
such an employer were to obtain a group health plan that was consistent 
with its faith, the commenter argued that the employer is at risk of 
liability due to OCR's position that it will transfer complaints 
alleging discrimination by an employer to the EEOC, which will review 
the employer's plan to determine if it is discriminatory under title 
VII of the Civil Rights Act.
    Response: As discussed throughout this section, a health insurance 
issuer or third party administrator subject to section 1557 is 
prohibited from discriminating on the basis of race, color, national 
origin, sex, age, or disability in its provision or administration of 
health insurance coverage or other health-related coverage, and is also 
able to seek assurance of a religious exemption consistent with Sec.  
92.302(b). As specified in Sec.  92.2(b), section 1557 does not apply 
to an employer or a plan sponsor with regard to its employment 
practices, including the provision of employee health benefits. A 
religious employer is able to obtain health insurance coverage or 
administration of its self-funded group health plan coverage from any 
entity not subject to section 1557, which would fall outside of the 
application of this rule.
Network Adequacy
    The comments and our responses regarding network adequacy are set 
forth below.
    Comment: Commenters appreciated OCR's attention to network adequacy 
and its acknowledgement that certain provider networks may constitute 
discriminatory benefit design under section 1557. Commenters stated 
that discriminatory provider networks profoundly affect the 
accessibility and quality of care for vulnerable populations. One 
commenter expressed concern that OCR has limited interest in complaints 
about access to care stemming from provider networks because the 
preamble in the Proposed Rule emphasized that health plans have 
discretion over benefit design and did not explicitly mention provider 
networks. A commenter recommended that OCR amend the proposed Sec.  
92.207(b)(2) to expressly reference provider networks as a type of 
design feature that falls within the scope of prohibited discriminatory 
activities.
    Response: OCR acknowledges the importance of network adequacy in 
ensuring nondiscriminatory access to health care while also recognizing 
covered entities' autonomy in developing their provider networks as 
part of their benefit design packages, consistent with existing State 
and Federal network adequacy and other laws, including section 
1557.\288\ OCR will accept complaints related to provider networks and 
will investigate allegations of discrimination on a case-by-case basis. 
OCR declines to amend Sec.  92.207(b)(2) because we believe the 
regulatory text is clear as written and does not require further 
clarification. As previously discussed, the term ``benefit design'' 
encompasses an array of features, including provider networks, and OCR 
intends to interpret it broadly.
---------------------------------------------------------------------------

    \288\ Network plans offer medical care through a defined set of 
providers under contract with the issuer. See 42 U.S.C. 300gg-
91(d)(10); 45 CFR 144.103 (defining ``network plan'' as ``health 
insurance coverage of a health insurance issuer under which the 
financing and delivery of medical care (including items and services 
paid for as medical care) are provided, in whole or in part, through 
a defined set of providers under contract with the issuer'').
---------------------------------------------------------------------------

    Comment: Commenters urged OCR to include examples of discriminatory 
network design while articulating several practices that they believed 
to be violations of section 1557. Some network design practices 
commenters characterized as discriminatory included low reimbursement 
rates that lead to lower provider participation, arbitrary limits to 
in-network providers, limiting the participation of safety-net 
providers, insufficient providers with accessible medical equipment, 
narrow pharmacy networks, and performance requirements related to cost 
or other outcome and quality measures. Commenters argued that all of 
these practices prevent access and may be used by covered entities to 
dissuade enrollees with high health needs from enrolling in plans.
    Response: OCR appreciates commenters providing examples of how 
network plan designs might have discriminatory impacts on vulnerable 
populations. While we agree that certain network plan designs and 
practices, such as excluding all or most providers that specialize in 
treating certain conditions, may be discriminatory under section 1557, 
we will not establish minimum network adequacy standards in this 
rulemaking. As discussed in the Proposed Rule, 87 FR 47877, covered 
entities employing network plan designs may be subject to network 
adequacy standards governed by State and Federal law. For example, CMS 
regulations establish network adequacy requirements for qualified 
health plans, Medicare Advantage plans, and Medicare Part D 
prescription drug plans, and require states to develop and enforce 
network adequacy standards for their contracted Medicaid managed care 
plans. See 87 FR 47877. Many of these regulations establish specific 
requirements that must be satisfied, such as inclusion of certain types 
of providers and time and distance standards. Recognizing that network 
adequacy is regulated by other Departmental regulations, as we noted in 
the 2016 Rule, and again note here, it is outside the scope of section 
1557 to establish uniform or minimum network adequacy standards.
    Comment: Commenters asserted that discriminatory network design 
practices lead to excessive, and often insurmountable, administrative 
burdens

[[Page 37630]]

for enrollees. Commenters also stated that provider network appeals 
processes can be opaque, arbitrary, and ultimately a tool to deny 
access to necessary care that meet the definition of a disability under 
the ADA. Commenters expressed concern over the increase in ``phantom 
networks,'' plans that list providers as in-network when they are not 
actually accepting patients, particularly for mental health providers. 
For example, commenters cited a recent study that showed that 60 
percent of the mental health providers in the Oregon Medicaid managed 
care network were not actually accepting patients.\289\ Commenters 
expressed frustration in discovering that certain in-network providers 
are unable or unwilling to address multiple co-occurring disabilities 
or general medical care for people with disabilities.
---------------------------------------------------------------------------

    \289\ Jane M. Zhu et al., Phantom Networks: Discrepancies 
Between Reported and Realized Mental Health Care Access in Oregon 
Medicaid, 41 Health Affairs 7, 1016 (2022), https://www.healthaffairs.org/doi/abs/10.1377/hlthaff.2022.00052.
---------------------------------------------------------------------------

    Response: Plan designs that subject individuals protected by 
section 1557 to excessive administrative burdens to access coverage 
benefits that other enrollees do not have to navigate to access 
coverage may be discriminatory under section 1557. Section 92.207(b) 
prohibits covered entities from discrimination ``in providing or 
administering'' (emphasis added) health insurance coverage or other 
health-related coverage.
    Comment: Commenters requested strict monitoring and enforcement of 
provider network compliance with section 1557. A commenter suggested 
that OCR include scrutiny of provider networks via regular compliance 
reviews in addition to investigating complaints. To determine whether a 
certain network design is discriminatory, a commenter urged OCR to 
consider access measures such as medication adherence, uptake of 
innovative therapies, and complaints and appeals regarding delayed or 
denied access to specialists and drugs. A commenter requested that OCR 
provide greater scrutiny to the impact of provider network 
consolidation, especially those involving religiously affiliated 
institutions, in creating discriminatory impacts on health care 
recipients.
    Other commenters stated that OCR should not establish network 
adequacy standards, as they believe that discrimination through network 
adequacy is sufficiently addressed by other State and Federal agencies 
as well as the National Association of Insurance Commissioners, 
National Committee for Quality Assurance, and URAC (formerly 
Utilization Review Accreditation Commission). Commenters noted that as 
network requirements increase, providers and facilities demand 
increased reimbursement rates, additional contracts for other member or 
system facilities, and specific network tier placement. Commenters 
asked OCR to consider limiting provider contracting practices such as 
``all-or-nothing'' contracting and anti-tiering clauses. They noted 
that such practices harm consumers by increasing provider leverage and 
driving up health care costs.
    Response: While we will not establish minimum network adequacy 
standards in this rulemaking, we emphasize that to ensure compliance 
with section 1557, covered entities must develop their networks in a 
nondiscriminatory manner. When determining whether an entity has 
violated this section, OCR will conduct a fact-intensive investigation 
to determine whether the challenged network excludes individuals from 
participation in or denies them the benefits of the plan, or otherwise 
discriminates against them on the basis of race, color, national 
origin, sex, age, or disability. This analysis will include evaluating 
whether a covered entity utilized, in a nondiscriminatory manner, a 
neutral rule or principle when deciding to adopt its provider network. 
As noted in the Proposed Rule, OCR is cognizant that a variety of 
factors may affect a covered entity's provider network design.\290\ If 
OCR determines that a network design is discriminatory, covered 
entities will be expected to provide a neutral, nondiscriminatory 
reason for the network design that is not a pretext for discrimination.
---------------------------------------------------------------------------

    \290\ Such factors include ``the geographic location of the 
service area, the number of available providers and specialists in 
the service area, reimbursement rates, the number of providers 
willing to contract with the payer, and the overall design of the 
plan as it relates to premiums.'' 87 FR 47877. We note that the 
importance of geographic limitations may be reduced due to the 
industry growth in virtual care and ease of medical travel, where 
clinically appropriate.
---------------------------------------------------------------------------

    Concerns around provider consolidation are out of the scope of this 
regulation; however, OCR acknowledges that as providers consolidate, 
there may be increased or novel concerns around discriminatory provider 
network design and impact to access to care for protected classes.
    Medical Diagnostic Equipment
    In the Proposed Rule, 87 FR 47836, OCR noted that individuals with 
mobility disabilities experience challenges accessing preventative, 
primary, and specialty care due to inaccessible medical diagnostic 
equipment (MDE). OCR sought comment on the extent to which a lack of 
accessible MDE within a provider network limits or denies access to 
care for individuals with disabilities. OCR also requested comment on 
whether it should incorporate the U.S. Access Board's Medical 
Diagnostic Equipment Standards (MDE Standards) as enforceable standards 
and whether a lack of accessible MDE constitutes discriminatory benefit 
design or network inadequacy.
    Comment: OCR received many comments urging OCR to adopt the MDE 
Standards, created pursuant to section 510 of the Rehabilitation Act, 
in the final rule. These commenters stated that inaccessible MDE leads 
to poor health outcomes for people with disabilities, mainly because 
inaccessible MDE results in individuals with disabilities receiving 
less preventative care, including mammograms and cervical screenings, 
compared to their counterparts without disabilities.\291\ One commenter 
also noted that this lack of preventative care, and ensuing poor health 
outcomes, could also place people with disabilities at unnecessary risk 
for institutionalization. Finally, these commenters urged OCR to state 
that the denial of services to individuals with disabilities due to 
inaccessible MDE is discrimination under other Federal disability 
rights laws, including section 504 and the ADA.
---------------------------------------------------------------------------

    \291\ See Nat'l Council on Disability, Enforceable Accessible 
Medical Equipment Standards: A Necessary Means to Address the Health 
Care Needs of People with Mobility Disabilities (2021), https://www.ncd.gov/assets/uploads/reports/ncd_medical_equipment_report_508.pdf.
---------------------------------------------------------------------------

    One commenter recommended that OCR require covered entities to 
ensure that within 30 days of the publication of the final rule, all 
newly purchased or replaced MDE comply with the MDE Standards. The 
commenter also recommended that OCR require all covered entities that 
use MDE to ensure that within two (2) years of the publication of this 
rule, all of their MDE meets the MDE Standards. A different commenter 
recommended that OCR use a similar approach to that required by the 
2010 ADA Standards for Accessible Design, 75 FR 56236 (Sep. 15, 2010), 
where accessible MDE would be purchased to replace older equipment as 
needed.
    Response: OCR appreciates the numerous comments requesting that the 
final rule require covered entities to comply with the MDE Standards. 
OCR agrees that when individuals with disabilities are denied 
appropriate preventative health care due to the

[[Page 37631]]

inaccessibility of MDE, they are placed at increased risk of poor 
health outcomes and potentially institutionalization. As noted, section 
504, the ADA, and section 1557 all prohibit covered entities from 
discriminating against people with disabilities by denying them 
appropriate health care services. Requiring covered entities to comply 
with the MDE Standards would be one method to ensure that people with 
certain disabilities receive appropriate health care services, while 
allowing for greater patient autonomy.
    On September 14, 2023, OCR issued an NPRM proposing updates to the 
Department's section 504 regulations.\292\ OCR proposed specific 
accessibility standards, scoping requirements, and time periods for 
compliance for MDE used by recipients of Federal financial assistance 
in that NPRM.\293\ Accordingly, while OCR recognizes the importance of 
ensuring that all people, regardless of disability status, receive 
effective preventative care, we will not address the MDE Standards in 
the regulatory text of this rulemaking.
---------------------------------------------------------------------------

    \292\ 88 FR 63392 (Sept. 14, 2023).
    \293\ 88 FR 63392, 63511 (Sept. 14, 2023) (proposed subpart J).
---------------------------------------------------------------------------

    Comment: Many commenters noted that while the MDE Standards were 
published in 2017, many providers, including recipients of Federal 
financial assistance, have failed to abide by the standards and acquire 
accessible MDE. As evidence, some commenters point to the data 
collected by the State of California concerning the prevalence of 
accessible MDE among providers, which they state indicates that the 
majority of California providers do not have accessible MDE.\294\ These 
commenters note that until a Federal regulation creates specific 
requirements, accessible MDE will not be used by the majority of 
providers. Finally, commenters noted that even if providers acquire 
accessible MDE, they still must ensure that their staff are able to use 
the MDE effectively in order for people with disabilities to benefit.
---------------------------------------------------------------------------

    \294\ Nancy R. Mudrick et al., Presence of Accessible Equipment 
and Interior Elements in Primary Care Offices, 3.1 Health Equity 275 
(2019), https://dredf.org/wp-content/uploads/2019/10/Presence-of-Accessible-Equipment-and-Interior-Elements-in-Primary-Care-Offices.pdf.
---------------------------------------------------------------------------

    Response: OCR recognizes that in the absence of an enforceable 
standard that requires providers to acquire MDE with specific features, 
providers may not acquire accessible MDE. This may be due in part to 
the cost of accessible MDE exceeding the cost of non-accessible MDE and 
the durability of existing MDE. OCR also agrees that if a provider 
acquires accessible MDE, such as an adjustable exam table, but does not 
ensure that staff can effectively use the table and assist patients 
with transfers, patients with disabilities will not benefit. For the 
MDE Standards to be effective, providers must also know how to use 
accessible MDE. OCR will continue to enforce existing nondiscrimination 
obligations and, as noted above, is in the process of rulemaking to 
adopt enforceable standards for accessible MDE under section 504.
    Comment: Numerous commenters requested that OCR consider expanding 
on the existing MDE Standards. Some commenters requested that OCR 
create new standards specific to individuals with visual impairments, 
sensory limitations, or cognitive disabilities. Some commenters also 
requested that OCR expand the MDE Standards to non-diagnostic medical 
equipment in addition to MDE, with others, requesting that OCR 
determine the scoping requirements that covered entities would have to 
follow under the MDE Standards.
    Response: OCR appreciates commenters' suggestions. Because we are 
not requiring providers to abide by the MDE Standards in this 
rulemaking, we will not determine whether to expand the MDE Standards 
beyond diagnostic equipment, create new standards unique to individuals 
with other disabilities, or determine the scoping requirements of the 
MDE Standards. However, we will consider these recommendations and note 
that regardless of whether medical equipment is diagnostic, a covered 
entity must make its health programs and activities accessible to 
individuals with disabilities.
    Comment: Numerous commenters stated that because of inaccessible 
MDE, many patients with disabilities have been asked to bring someone 
with them to appointments in order to help them transfer onto MDE. The 
commenters state that it is never appropriate to require this of a 
patient.
    Response: Existing Federal civil rights laws, including section 
504, title II of the ADA, and the existing section 1557 implementing 
regulation, forbid providers from requiring a patient with a disability 
to bring their own aide or support person to an appointment to assist 
them with transfers. Any person who has been required by a provider to 
bring another person to an appointment to assist with transfers is 
encouraged to file a complaint with OCR.
    Comment: One commenter stated that the use of accessible MDE could 
be considered a reasonable modification for persons with disabilities 
as required by existing disability rights laws.
    Response: Providing accessible MDE is one method that providers can 
use to ensure that a patient with a disability is able to access a 
provider's programs and activities. A provider would likely violate 
Federal disability discrimination laws like section 504, the ADA, and 
section 1557 if the health programs and activities they provide, 
including preventative and diagnostic care, are not accessible to 
people with disabilities.
    Comment: One commenter stated that while requiring covered entities 
to obtain and use accessible MDE would be beneficial to people with 
disabilities, in certain circumstances it may be sufficient for a 
covered entity without accessible MDE to offer transportation to 
another covered entity with accessible MDE.
    Response: While a provider acquiring and using accessible MDE so 
that its patients with disabilities are able to receive health care in 
its offices is preferrable, there may be specific situations where it 
is appropriate for the provider to offer transportation to another 
facility that has accessible MDE.
    Comment: Many commenters stated that they consider accessible MDE 
to raise both network adequacy and benefit design implications. They 
believed that a lack of accessible MDE leads to a lack of in-network 
care and a lack of network adequacy, which they alleged to be 
discriminatory. They stated that benefit design could be used to embed 
accessible MDE requirements. They also stated that accessibility should 
also be considered in conjunction with time and distance standards to 
determine network adequacy.
    Response: OCR appreciates commenters raising these important 
opinions concerning how the presence of accessible MDE affects network 
adequacy and benefit design. While OCR has decided not to explicitly 
address accessible MDE in this rulemaking, we refer commenters to the 
discussion of network adequacy and benefit design under this section.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, OCR is finalizing the nondiscrimination in health 
insurance coverage and other health-related coverage provision at Sec.  
92.207 as proposed, with modification. We have revised Sec.  
92.207(b)(6) to clarify that the integration requirement extends to 
practices that result in the serious risk of institutionalization or 
segregation. We have revised Sec.  92.207(c) to strike the text 
following ``legitimate,

[[Page 37632]]

nondiscriminatory reason for'' and now the text prohibits ``denying or 
limiting coverage of the health service or determining that such health 
service fails to meet applicable coverage requirements including 
reasonable medical management techniques such as medical necessity 
requirements.'' This section also provides that ``such coverage denial 
or limitation must not be based on unlawful animus or bias, or 
constitute a pretext for discrimination. Nothing in this section is 
intended to preclude a covered entity from availing itself of 
protections described in Sec. Sec.  92.3 and 92.302.'' We have also 
made conforming edits to include ``or any combination thereof'' to the 
list of prohibited bases of discrimination found Sec.  92.207(a) and 
(b)(1) and (2).
Prohibition on Sex Discrimination Related to Marital, Parental, or 
Family Status (Sec.  92.208)
    In Sec.  92.208, OCR proposed to prohibit covered entities from 
discriminating on the basis of sex in their health programs and 
activities with respect to an individual's marital, parental, or family 
status. The 2016 and 2020 final rules did not include a similar 
provision. This is not a new concept, however, as it is similar to the 
Department's title IX implementing regulations. See 45 CFR 86.40(a). 
Section 92.208 provides that, in determining whether an individual 
satisfies any policy or criterion regarding access to its health 
programs or activities, a covered entity must not take an individual's 
sex into account in applying any rule concerning an individual's 
current, perceived, potential, or past marital, parental, or family 
status.\295\
---------------------------------------------------------------------------

    \295\ This final rule does not preclude the application of 
Federal laws regarding eligibility criteria for certain Federal 
programs under CMS.
---------------------------------------------------------------------------

    The comments and our responses regarding Sec.  92.208 are set forth 
below.
    Comment: Many commenters supported the inclusion of Sec.  92.208 
because it provides clarity for patients and providers and brings OCR 
into alignment with other nondiscrimination practices set by section 
1557, ensuring that all vulnerable groups receive the same level of 
civil rights protections. Several commenters mentioned that this change 
aligned with the title IX regulation, which has, since 1975, explicitly 
interpreted sex discrimination to encompass discrimination on the basis 
of current, potential, or past parental, family, or marital status that 
treats persons differently on the basis of sex. Commenters also raised 
other civil rights statutes, like the Civil Service Reform Act that is 
applicable to Federal employees, which explicitly includes protections 
based on marital status.\296\
---------------------------------------------------------------------------

    \296\ See Public Law 95-454, sec. 101, 92 Stat. 1111, 1113-14 
(Oct. 13, 1978), codified at 5 U.S.C. 2301(b).
---------------------------------------------------------------------------

    Response: OCR agrees that including this provision brings 
regulations in line with other civil rights laws that recognize 
policies that treat people differently on the basis of sex in applying 
rules related to marital, parental, or family status,\297\ as 
discrimination on the basis of sex, particularly, and as stated in the 
Proposed Rule's preamble, the Department's longstanding acknowledgment 
of this interpretation of title IX, at 45 CFR 86.40(a).
---------------------------------------------------------------------------

    \297\ The term ``family status'' used in this rule is distinct 
from any defined terms in other rules, including ``familial status'' 
as defined in the Fair Housing Act, 42 U.S.C. 3601 et seq.
---------------------------------------------------------------------------

    Comment: Numerous commenters supported proposed Sec.  92.208. Some 
of these commenters explained that taking marital, parental, or family 
status into account has engendered arbitrary policies at medical 
facilities that create barriers to accessing health care, which can 
result in harmful and inequitable treatment of individuals. Many 
commenters stated that this provision will help alleviate the denial of 
care some women experience because they are single, unmarried, 
childless, or not in the presence of a male partner or husband when 
they are seeking, for instance, birth control.
    Response: OCR agrees that absent the prohibition on taking sex into 
account in marital, parental, or family status, covered entities may 
adopt arbitrary policies that could create unnecessary inequities and 
result in harmful health outcomes. Section 92.208 prohibits 
discrimination that applies different policies and procedures based on 
sex in the context of marital, parental, or family status; it does not, 
however, prohibit discrimination on the basis of marital status alone 
(i.e., single, divorced, widowed, etc.). As discussed in the 2022 NPRM, 
OCR encountered complaints, in the course of its enforcement work, 
where covered entities applied different policies for married men and 
married women. For example, OCR has settled cases against covered 
entities with policies of automatically assigning a male spouse as the 
guarantor when a female spouse received medical services, while not 
automatically assigning a female spouse as the guarantor when a male 
spouse received medical services. 87 FR 78878.
    Comment: Many commenters supported the protections against 
discrimination on the basis of sex in the context of marital, parental, 
and family status contained in Sec.  92.208 because of their impact on 
same-sex couples and the varying types of discrimination that this 
group experiences, including past experiences of discrimination on the 
basis of marital, parental, and family status alone. For example, some 
commenters said that these protections are critical because, although 
many same-sex couples live in committed relationships, they are less 
likely to be married, largely due to laws that until recently 
prohibited same-sex marriage. These protections, commenters argued, 
help to insulate LGBTQI+ individuals who have experienced 
discrimination in many health care settings, such as hospitals where 
they have been denied visitation rights and authority to make medical 
decisions impacting their loved ones' health conditions. Many 
commenters highlighted that these forms of discrimination were well 
documented during the AIDS crisis, when longtime partners were 
regularly denied hospital visitation rights and lacked adequate 
protections, even for discrimination based solely on marital status. 
For similar reasons, some commenters stated that this provision would 
protect families headed by same-sex couples, who may be denied the 
right to make medical decisions for their children. These commenters 
noted, that in the health care context, the involvement of family and 
external support systems can improve health outcomes, management of 
chronic illnesses, and continuity of care.
    Response: OCR agrees that the prohibition on taking an individual's 
sex into account in applying any rule concerning an individual's 
current, perceived, potential, or past marital, parental, or family 
status can be critical in health care settings involving medical 
decision-making and visitation rights, particularly for same-sex 
couples. Section 92.208 prohibits a covered entity from implementing a 
policy related to marital, parental, or family status that treats 
individuals differently on the basis of sex (e.g., male spouses of 
women can make medical decisions for their children but non-male 
spouses of women cannot, or allowing visitation rights for a married 
heterosexual couple but denying visitation rights to a married same-sex 
couple), but it does not prohibit covered entities from making 
distinctions based upon their marital status alone (e.g., applying 
different rules to married and nonmarried individuals that do not 
distinguish based on an individual's sex).
    Comment: Other commenters also discussed the impact that the 
protections contained in proposed

[[Page 37633]]

Sec.  92.208 have on same-sex couples seeking fertility treatments. 
They stated that these protections are needed because some health 
insurance coverage or other health-related coverage include in vitro 
fertilization (IVF) treatments as a covered benefit for heterosexual 
married couples, but not for same-sex married couples. Some commenters 
highlighted how, in their view, institutional policies' definition of 
``infertility'' lead to such a discriminatory practice. This 
establishes what commenters describe as an impossible standard for 
same-sex couples to meet when seeking fertility treatment and coverage.
    Response: OCR understands that not all covered health insurance 
issuers offer fertility coverage or treatments. However, those that do 
must offer such benefits in a nondiscriminatory manner. For example, a 
covered health insurance issuer that offers fertility coverage or 
treatments for married different-sex couples could not deny the same 
coverage or treatments to married same-sex couples. section 1557's 
prohibitions of discrimination apply across all covered health programs 
and activities.
    Comment: Other commenters who supported the inclusion of Sec.  
92.208 stated that these protections are important because they help 
ensure nondiscrimination against a wide range of family structures.
    Response: OCR reminds commenters that this section prohibits 
discrimination on the basis of sex when applying rules related to 
marital, parental, and family status, and is not to be conflated with 
prohibition against discrimination on the basis of these statuses 
alone. Thus, policies and procedures that include conditions or 
limitations tied to these statuses would not run afoul of this rule 
unless they applied differently based on the sex of the individuals.
    Comment: Some commenters supported Sec.  92.208 because in their 
view, a medical practice cannot refuse a female patient solely because 
she has a female spouse or partner, as this could constitute a denial 
on the basis of association.
    Response: OCR agrees that a medical practice may not refuse to see 
a prospective female patient based solely on the fact that the patient 
has a female spouse if they otherwise accept married individuals into 
their practice. This is because the refusal would be based on the sex 
of the prospective patient and would therefore constitute sex 
discrimination related to marital status. And, as noted in the Proposed 
Rule, a denial based on a female patient having a female spouse or 
partner would also constitute discrimination on the basis of 
association, which is specifically addressed in Sec.  92.209, as the 
refusal would be based on the sex of an individual with whom the 
patient is known to have a relationship or association. 87 FR 47880.
    Comment: Many commenters opposed the inclusion of Sec.  92.208, 
stating that if Congress meant to include ``marital, parental, or 
family status'' in section 1557 it would have done so, just as it did 
in part in the Equal Credit Opportunity Act (ECOA) (including ``marital 
status'') and the Fair Housing Act (FHA) (including ``familial 
status''). These commenters contended that adding these protections 
would make the addition of marital and familial status a mere 
surplusage to the text of the ECOA and FHA, and that it would include 
additional terms to their application despite neither statute 
explicitly including the additional terms. Some commenters who opposed 
the provision also stated that OCR needs to account for the additional 
costs of including these changes, especially as it may impact religious 
institutions that provide marital counseling services.
    Response: OCR disagrees that clarifying these protections under 
section 1557 impacts either the ECOA or FHA.\298\ While these statutes 
bar discrimination on the basis of an individual's marital or familial 
status per se, Sec.  92.208 bars discrimination on the basis of sex as 
it relates to marital and family status. As discussed in the 2022 NPRM, 
87 FR 47878, this final rule's interpretation is consistent with a 
parallel, longstanding prohibition included in the Department's title 
IX implementing regulations, 45 CFR 86.40(a). OCR has consistently 
interpreted the scope of section 1557's prohibition on the ground of 
sex consistently with the scope of title IX's prohibition of 
discrimination on the ground of sex, which includes discrimination 
within the context of marital, parental, or family status.\299\ This 
provision will apply similar standards already enforced by OCR, and we 
do not anticipate additional costs for covered entities, including 
religious institutions beyond the costs already captured in the 
Regulatory Impact Analysis below for recipients to seek assurances of 
religious and conscience exemptions under Sec.  92.302(b).
---------------------------------------------------------------------------

    \298\ Cf. Conn. Nat'l Bank v. Germain, 503 U.S. 249, 253 (1992) 
(courts must give effect to statutes with overlapping coverage ``so 
long as there is no `positive repugnancy' between the two'').
    \299\ As discussed in the 2022 NPRM, 87 FR 47878, OCR has 
resolved complaints against covered entities with policies of 
automatically assigning a male spouse as the guarantor when a female 
spouse received medical services, while not automatically assigning 
a female spouse as the guarantor when a male spouse received medical 
services. See U.S. Dep't of Health & Hum. Servs., Off. for Civil 
Rts., Sex Case Summaries: Summary of Selected OCR Compliance 
Activities, https://www.hhs.gov/civil-rights/for-providers/compliance-enforcement/examples/sex-discrimination/.
---------------------------------------------------------------------------

Discrimination on the Basis of Pregnancy-Related Conditions
    In proposing Sec.  92.208, OCR stated its view that it could be 
beneficial to include a provision that would specifically prohibit 
discrimination on the basis of pregnancy-related conditions as a form 
of sex-based discrimination, and sought comment on how to include such 
a provision in the final rule. 87 FR 47879. This proposal was 
specifically requesting comment on a stand-alone provision, separate 
from the inclusion of ``pregnancy or related conditions'' in Sec.  
92.101(a)(2)'s inclusion of the term. Including such a provision at 
Sec.  92.208 would mirror its placement to those of the Department's 
title IX implementing regulations at 45 CFR 86.21(c), 86.40, 86.52(b), 
and 86.57. The 2016 Rule explicitly included ``pregnancy, false 
pregnancy, termination of pregnancy, or recovery therefrom, childbirth 
or related medical conditions'' in former Sec.  92.4. While the 2020 
Rule did not include any definition of ``sex discrimination,'' it 
indicated that section 1557 would be enforced consistent with title IX 
and its implementing regulations, which includes these terms. For the 
reasons explained below, we decline to add ``pregnancy or related 
conditions'' to Sec.  92.208.
    The comments and our responses regarding this request for comment 
are set forth below.
    Comment: Many commenters supported the inclusion of a provision 
that includes pregnancy-related conditions as a prohibited form of 
discrimination on the basis of sex. Numerous commenters discussed that 
pregnancy-related conditions are inherently linked to sex because 
discrimination on that basis affects an individual's ability to make 
decisions about their reproductive health and life, and affects 
individuals' ability to be equal and participating members of society.
    Response: OCR appreciates these comments and agrees that clarifying 
that discrimination on the basis of sex includes pregnancy-related 
conditions, as Sec.  92.101(a)(2)(ii) (``discrimination on the basis of 
sex includes . . . pregnancy or related conditions'') does, is critical 
to ensuring that individuals are protected against this form of sex 
discrimination. OCR also agrees that discrimination on the basis of

[[Page 37634]]

pregnancy or related conditions can negatively affect an individual's 
ability to make decisions about their reproductive health and life, and 
their ability to be equal and participating members of society.
    Comment: Many commenters who supported the inclusion of pregnancy-
related conditions discussed the need for clarity in light of the 
Supreme Court's decision in Dobbs. Commenters contended that pregnancy-
related conditions should be included in the definition of ``sex 
discrimination'' because it would reinforce covered entities' legal 
obligations under section 1557, and would allow OCR to address related 
discrimination more holistically and inclusively.
    Commenters maintained that pregnancy protections are critical in 
light of total or near-total abortion bans in some States after the 
Dobbs decision. Commenters explained that this legal uncertainty 
warrants clarity and explicit protections for pregnancy-related 
conditions, including termination of pregnancy, because patients and 
providers have been left uncertain and fearful of their ability to 
provide care, are subjected to additional scrutiny, and face the 
possibility of criminal prosecution and civil litigation in States that 
have limited reproductive health care options.
    Response: OCR affirms that under section 1557, covered entities may 
not discriminate against individuals for their pregnancy-related 
decisions, past, present, or future. OCR declines to add in additional 
protections outside of the scope of this rule. At the same time, the 
ACA itself provides that ``[n]othing in this Act shall be construed to 
have any effect on Federal laws regarding--(i) conscience protection; 
(ii) willingness or refusal to provide abortion; and (iii) 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.'' 42 U.S.C. 18023(c)(2)(A).\300\ HHS will 
comply with this provision.
---------------------------------------------------------------------------

    \300\ The application of this final rule to covered entities 
with conscience or religious freedom objections are discussed more 
fully below in Sec. Sec.  92.3 (Relationship to other laws) and 
92.302 (Notification of views regarding application of Federal 
religious freedom and conscience laws).
---------------------------------------------------------------------------

    Comment: Some commenters discussed privacy concerns involving 
HIPAA, as some providers have worried that medical privacy may be 
compromised when patients seek care or information, even if unrelated 
to abortion. Commenters argued for the need to include pregnancy-
related protections under section 1557 so that patients are not 
discriminated against for their pregnancy-related decisions, past, 
present, or future.
    Response: OCR appreciates the privacy concerns raised by these 
commenters. OCR affirms that under section 1557, covered entities may 
not discriminate against individuals for their pregnancy-related 
decisions, past, present, or future, including where the patient 
discloses the information or where such information is contained in 
medical records. Indeed, HIPAA was enacted to protect such sensitive 
patient health information from being disclosed without the patient's 
consent or knowledge. Separately, OCR is considering revisions to the 
HIPAA Privacy Rule to strengthen privacy protections for individuals' 
protected health information related to reproductive health care. See 
HIPAA Privacy Rule To Support Reproductive Health Care Privacy, notice 
of proposed rulemaking, 88 FR 23506 (Apr. 17, 2023).
    Comment: Other commenters urged OCR to address pregnancy-related 
conditions but to do so elsewhere in the rule, either in the provisions 
on what constitutes discrimination on the basis of sex (Sec.  
92.101(a)(2)), equal program access on the basis of sex (Sec.  
92.206(b)), or nondiscrimination in health insurance coverage (Sec.  
92.207(b)). These commenters explained that confining the discussion of 
the pregnancy-related conditions to Sec.  92.208 (Prohibition on sex 
discrimination related to marital, parental, or family status) risked a 
narrow interpretation and application of the prohibition, and could 
lead providers to consider this prohibition to be limited in context 
and scope. Commenters emphasized that pregnancy-related protections are 
relevant to a wide range of conduct beyond the context of marital, 
parental, or familial status and should not exclude individuals who are 
single. Commenters also raised that pregnancy-related discrimination 
applies to a broad scope of protected services, such as the decision to 
access certain reproductive health care services (e.g., contraception), 
as well as denials of reproductive services and insurance coverage. 
Many commenters suggested that OCR include pregnancy-related conditions 
in a standalone provision, because OCR could then further clarify the 
interplay between section 1557 and other Federal statutes or 
regulations related to termination of pregnancy that may apply to 
covered entities.
    Response: OCR appreciates these comments. In the 2022 NPRM, OCR 
considered including additional details regarding discrimination on the 
basis of ``pregnancy or related conditions'' in Sec.  92.208 to mirror 
its placement to the Department's title IX implementing regulations at 
45 CFR 86.21(c), 86.40, 86.52(b), and 86.57. However, having considered 
the comments received, OCR concluded that the rule is better served by 
leaving ``pregnancy or related conditions'' in Sec.  92.101(a)(2), 
which outlines the scope of discrimination on the basis of sex. The 
Department believes Sec.  92.101(a)(2)--which addresses forms of sex 
discrimination generally--is a better location, so as to not suggest 
that discrimination based on pregnancy or its related conditions is 
limited to instances of discrimination involving only marital, 
parental, or family status.
    Comment: Many commenters supported the inclusion of pregnancy-
related conditions, but suggested additional changes to the rule, 
including explicit descriptions of what pregnancy or related conditions 
encompasses. Several commenters encouraged OCR to add language 
establishing that pregnancy-related conditions specifically include 
pregnancy termination, childbirth, false pregnancy, ectopic pregnancy, 
miscarriage, and recovery, including any refusal of service or 
procedure based on any other protected basis under the rule.
    Response: OCR agrees that protections for ``pregnancy or related 
conditions'' are critical and affirms that covered entities may not 
discriminate against individuals based on pregnancy or related 
conditions under section 1557. However, additional language to identify 
what the term ``pregnancy or related conditions'' means is not 
necessary given that the regulatory language is not intended to be 
exhaustive as explained above. As noted in the NPRM, OCR understands 
the term as including childbirth, false pregnancy, termination of 
pregnancy, and recovery therefrom, which are the ``grounds'' prohibited 
under title IX.\301\ 87 FR 47878.
---------------------------------------------------------------------------

    \301\ 45 CFR 86.40(a).
---------------------------------------------------------------------------

    Comment: Some commenters opposed the inclusion of pregnancy-related 
conditions. One commenter cautioned OCR to not rely on the Dobbs 
decision or its effects as a basis for prohibiting discrimination on 
pregnancy-related conditions, including pregnancy termination. Some 
commenters stated Dobbs held that the regulation of abortion was 
returned to the States, and thus, OCR cannot propose a provision that 
is inclusive of abortion, which would be contrary to Congressional and 
judicial prohibitions. Other commenters, despite acknowledging

[[Page 37635]]

that the title IX regulations have since 1975 included ``pregnancy and 
related conditions'' (which includes termination of pregnancy), argued 
that because the term ``termination of pregnancy'' is not defined in 
the title IX regulations, the term should not be adopted here. A 
commenter suggested that OCR either not include ``termination of 
pregnancy'' as a pregnancy-related condition or clarify that 
``termination of pregnancy'' does not include abortion because abortion 
is not morally equivalent to pregnancy or childbirth and should not be 
treated as such. Some commenters who opposed including pregnancy-
related conditions argued that if the final rule includes such a term, 
OCR must account for its impact.
    Response: OCR appreciates comments regarding the inclusion of 
``pregnancy or related conditions,'' including those concerns related 
to Dobbs. OCR is not promulgating this rule in response to Dobbs, which 
addressed the question of whether the Constitution provides a right to 
abortion. This rule does not purport to interpret the Constitution, nor 
does it address whether States may regulate or ban abortions. Indeed, 
we emphasize that section 1303 of the ACA specifically states that 
``[n]othing in this Act shall be construed to preempt or otherwise have 
any effect on State laws regarding the prohibition of (or requirement 
of) coverage, funding, or procedural requirements on abortions, 
including parental notification or consent for the performance of an 
abortion on a minor.'' 42 U.S.C. 18023(c)(1). Pursuant to that 
provision, this rule should not be read to override any such State 
abortion laws. OCR reiterates that a covered provider does not engage 
in discrimination prohibited by section 1557 if it declines to provide 
abortions based on religious or conscience objections to performing the 
care, based on a professional or business judgement about the scope of 
services it wishes to offer, or for any other nondiscriminatory reason.
    This rule implements section 1557 of the ACA, which prohibits 
discrimination on the basis of race, color, national origin, sex, age, 
or disability in covered health programs or activities by incorporating 
the ``grounds prohibited under'' title VI, title IX, the Age Act, and 
section 504. Under title IX, discrimination based on pregnancy has been 
understood to constitute sex discrimination since 1975. Consistent with 
this long-standing interpretation, OCR will consider complaints of sex 
discrimination, including discrimination based on pregnancy or related 
conditions, on a case-by-case basis, and it will look to title IX and 
section 1557 case law to determine whether discrimination on the basis 
of sex has occurred. OCR is unaware of any instance in which a covered 
entity has been required to provide an abortion under title IX, title 
VI, the Age Act, or section 504.
    Consistent with this understanding of the incorporated statutes, 
the relevant case law, and historical practice, OCR emphasizes that a 
covered provider's decision not to provide abortions is not itself sex 
discrimination, under section 1557. Section 1557 prohibits 
discrimination on the basis of race, color, national origin, sex, age, 
or disability in covered health programs or activities. As noted above, 
a covered provider that generally offered abortion care could violate 
that prohibition if, for example, it generally offers or provides 
abortions to patients but refused to offer or provide an abortion to a 
particular patient because of that patient's race or disability. But a 
covered provider does not engage in discrimination prohibited by 
section 1557 if it declines to provide abortions based on religious or 
conscience objections to performing the procedure, based on a 
professional or business judgment about the scope of the services it 
wishes to offer, or for any other nondiscriminatory reason.
    Comment: Many commenters stated that Dobbs prevents OCR from 
protecting access for abortion care through its proposed definition of 
sex, because the Supreme Court held there is no constitutional right to 
an abortion and returned the issue to the States. Other commenters also 
stated that, because Dobbs returned the issue of abortion to the 
States, OCR cannot create regulations that would create conflicts with 
State laws banning or restricting abortion. Additionally, these 
commenters raised section 1303 as another basis under which the ACA 
prohibits OCR from issuing regulations that preempt State laws 
regarding abortion.
    Other commenters raised the view that Dobbs reaffirmed Bray v. 
Alexandria Women's Health Clinic, 506 U.S. 263 (1993), which held that 
opposition to abortion does not constitute animus against women. They 
contend that OCR cannot therefore define sex to include pregnancy 
termination. Commenters also stated that Dobbs established that there 
is no compelling government interest in promoting abortion, and 
therefore OCR has no authority to promulgate rules in support of 
abortion. A few commenters expressed that under the ``major questions'' 
doctrine, OCR cannot set an abortion policy such as prohibiting 
discrimination on the basis of pregnancy termination without explicit 
authorization from Congress.
    Response: OCR appreciates the commenters' concerns and their 
interpretation of Dobbs. The Dobbs opinion did not address title IX or 
section 1557. Dobbs nowhere prohibits OCR from issuing regulations or 
promulgating rules under its statutory authorities. Indeed, under 
section 1557, HHS is charged by Congress with the elimination of 
discriminatory barriers in the administration and provision of a 
diverse range of health programs and activities.
    As OCR has previously stated, this rule does not establish a 
Federal policy requiring or promoting abortion services. Although OCR 
has concluded that section 1557 does not require the Department to 
incorporate the language of title IX's abortion neutrality provision, 
see Sec.  92.208 (Prohibition on sex discrimination related to marital, 
parental, or family status), as we note throughout this preamble, OCR 
emphasizes that a covered provider's decision not to provide abortions 
does not itself constitute discrimination in violation section 1557. 
Section 1557 prohibits discrimination on the basis of race, color, 
national origin, sex, age, or disability in covered health programs or 
activities.
    It bears emphasis that nothing in the ACA, including section 1557, 
has ``any effect on Federal laws regarding--(i) conscience protection; 
(ii) willingness or refusal to provide abortion; and (iii) 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.'' 42 U.S.C. 18023(c)(2)(A). In addition, 
nothing in the ACA, including section 1557, preempts or has any effect 
on State laws regarding ``the prohibition of (or requirement of) 
coverage, funding, or procedural requirements on abortions'' as 
provided in section 1303 of the ACA, 42 U.S.C. 18023(c)(1).
    OCR's interest is protecting individuals against prohibited forms 
of discrimination under section 1557 when accessing the range of health 
programs and activities covered under the statute. OCR also disagrees 
that the ``major questions'' doctrine is implicated by its promulgation 
of rules that protect individuals from discrimination on the basis of 
sex consistent with the manner in which the term has long been 
interpreted in the title IX context.
    Comment: Many commenters stated that Dobbs had--and continues to 
have--a significant impact that warrants section 1557's protections 
against

[[Page 37636]]

discrimination on the basis of pregnancy or related conditions. Many 
commenters discussed that Dobbs limited access to abortion nationwide 
and created a complex web of State laws that ban or severely restrict 
access to care. These commenters stated that certain communities, 
including people of color, people with low incomes, immigrants, young 
people, people with disabilities, and LGBTQI+ individuals are most 
likely to face legal barriers to accessing abortion care, including an 
increased threat of arrest and prosecution in States hostile to 
abortion.
    Many commenters also posited that States' efforts to restrict 
access to abortion have resulted in further challenges to accessing 
other reproductive health care, including contraception, fertility care 
and treatment, and miscarriage or early pregnancy loss management. 
Commenters cited examples from multiple States where women experiencing 
miscarriages have been denied care even as their pregnancy-related 
complications threaten their health and lives.
    Response: OCR understands commenters' concerns regarding the 
negative health impacts stemming from the Dobbs decision, including on 
those with pregnancy-related conditions. We emphasize, as we have 
repeatedly throughout this preamble, that this rule is neither a 
response to Dobbs nor affected by that decision. This rule rests on the 
application of section 1557's nondiscrimination prohibition, and the 
longstanding interpretation of title IX's prohibition on sex 
discrimination to include discrimination on the basis of pregnancy and 
related conditions.
    Comment: Many commenters raised concerns about access to 
prescriptions related to contraception, miscarriages or early pregnancy 
loss, and medication abortion. Commenters also raised concerns about 
access to drugs prescribed to treat conditions like chronic disease or 
illness that are unrelated to abortion, but may have the effect of 
terminating a pregnancy. Some commenters explained that pharmacists are 
fearful about dispensing medications that could terminate a pregnancy 
even when the medication is not prescribed for the purpose of abortion, 
and in some instances, pharmacists have refused to fill prescriptions 
in certain States that have banned abortion.
    In States that have banned abortion, commenters noted that 
physicians, health care providers, and pharmacists fear they will be 
criminally prosecuted under State law, leading to denials or delays in 
lawful access to medications to treat conditions unrelated to abortion. 
For instance, many commenters explained that certain drugs prescribed 
to treat health conditions such as cancer, arthritis, ulcers, 
autoimmune diseases, or other chronic conditions are being denied or 
limited because they can result in termination of a pregnancy. 
Specifically, commenters relayed that some treatments for conditions 
such as breast cancer, brain cancer, prostate cancer, alcoholism, post-
traumatic stress disorder, and depression involve drugs that are being 
denied because of an indirect potential relationship with pregnancy 
termination.
    Similarly, many commenters requested clarification that section 
1557's prohibitions on discrimination protect access to contraception 
in the retail pharmacy setting. They raised concerns and described 
instances where individuals are denied access to hormonal contraception 
at a pharmacy that provides other forms of contraceptives. Some 
commenters opined that a pharmacy's refusal to provide prescribed 
medication to enable IUD (intrauterine device) insertion, or to treat 
an incomplete miscarriage, should be considered a section 1557 
violation.
    Commenters were concerned that such discrimination is not only sex 
and disability discrimination, but also creates additional and 
unnecessary barriers to prescription drugs that people need to live and 
maintain their health. For example, many commenters discussed that 
people with disabilities are increasingly denied or subjected to 
barriers to obtaining methotrexate, which is a prescription drug used 
to treat cancer and autoimmune conditions, because of the drug's 
potential effects on pregnancy. Many commenters explained that a 
pharmacist's refusal to fill an individual's prescription or a 
pharmacist's decision to not stock a specific drug or class of drugs 
inevitably harms persons with disabilities and women, especially those 
experiencing miscarriages and early pregnancy loss. They stated that 
women are also more likely than men to have autoimmune diseases for 
which many of these drugs are prescribed.
    Response: OCR appreciates comments relating to access to lawfully 
prescribed and medically necessary medications. To start, OCR notes 
that, on September 29, 2023, after the close of the comment period for 
this rule, OCR issued revised guidance to pharmacies that supersedes 
the guidance referred to by some commenters.\302\ If a covered entity 
denies or delays lawful access to medications to support persons with 
disabilities, treat cancer, or treat an autoimmune condition, that 
refusal could violate section 1557 if, for example, the refusal is on 
the basis of a prohibited ground, such as the person's race, age, 
disability, or sex. But, as OCR clarified in its updated guidance to 
the nation's pharmacies, section 1557 does not require pharmacies to 
fill prescriptions for medication for the purpose of abortion, nor does 
the guidance suggest or imply an obligation of pharmacies to fill 
prescriptions for medication in violation of State laws, including 
those banning or restricting abortion.\303\ OCR provided several 
examples in the guidance, in which denying lawfully prescribed 
medication to customers may violate civil rights laws.\304\ For 
example, where a treating physician diagnoses a miscarriage complicated 
by a uterine infection and orders an antibiotic to treat a patient's 
chills, fever, and vaginal bleeding, a pharmacy that refuses to provide 
the antibiotic because of concern that subsequent care may include an 
abortion may be discriminating on the basis of sex. OCR will evaluate 
and apply all applicable statutory protections, including relevant 
religious freedom and conscience protections, on a case-by-case basis.
---------------------------------------------------------------------------

    \302\ See U.S. Dep't of Health & Hum. Servs., Guidance to the 
Nation's Retail Pharmacies: Obligations Under Federal Civil Rights 
Laws to Ensure Nondiscriminatory Access to Health Care at 
Pharmacies, (Sept. 29, 2023), https://www.hhs.gov/civil-rights/for-individuals/special-topics/reproductive-healthcare/pharmacies-guidance/. On April 5, 2024, the court in State of Texas 
v. Becerra et al., No. 7:23-cv-00022-DC, Order for S.J., ECF No. 69 
(W.D. Tex.), held that the revised guidance mooted plaintiffs' legal 
challenge to the superseded guidance.
    \303\ See U.S. Dep't of Health & Hum. Servs., Guidance to 
Nation's Retail Pharmacies: Obligations under Federal Civil Rights 
Laws to Ensure Nondiscriminatory Access to Health Care at Pharmacies 
(September 29, 2023), https://www.hhs.gov/civil-rights/for-individuals/special-topics/reproductive-healthcare/pharmacies-guidance/ (``nor does the guidance suggest or imply an 
obligation of pharmacies to fill prescriptions for medication in 
violation of State laws, including those banning or restricting 
abortion'').
    \304\ Id.
---------------------------------------------------------------------------

    In addition, the ACA is hardly silent on the issue of abortion. It 
contains an elaborate set of rules for when and how a qualified health 
plan may refuse or be prohibited from providing or paying for certain 
abortions. See 42 U.S.C. 18023(a)-(b). It further specifies that State 
laws regarding abortion are not preempted and that ``nothing in this 
act shall be construed to have effect on federal laws regarding--(i) 
conscience protections; (ii) willingness or refusal to provide 
abortion; and (iii) discrimination on the basis of willingness or 
refusal to provide, pay

[[Page 37637]]

for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.'' Id. at 18023(c).
    Comment: OCR sought comment on the title IX abortion neutrality 
provision's inclusion and on other possible readings of that provision. 
Although OCR also sought comment on whether the Department should align 
its title IX regulation regarding the abortion neutrality provision of 
title IX with the 2000 ``Common Rule'' version of that regulatory 
provision that more than 20 agencies have long adopted,\305\ no 
comments addressed this specifically. Many commenters supported OCR's 
proposal to not import the language of title IX's abortion neutrality 
provision into section 1557's final rule. Doing so, they contended, 
would undermine and be contrary to OCR's implementation of section 
1557, which is to eliminate barriers and expand access to health care 
and coverage. These commenters discussed how abortion is a critical 
form of health care and patients seek or need to terminate a pregnancy 
for a wide variety of reasons.
---------------------------------------------------------------------------

    \305\ See 65 FR 52869 (Aug. 30, 2000); see also, e.g., 28 CFR 
54.235(d)(1) (DOJ regulation). The agencies that have adopted the 
Common Rule include: Agency for International Development, 22 CFR 
part 229; Corporation for National and Community Service, 45 CFR 
part 2555; Department of Agriculture, 7 CFR part 15d.; Department of 
Commerce, 15 CFR part 8a; Department of Defense, 32 CFR part 196; 
Department of Energy, 10 CFR part 1040; Department of Homeland 
Security, 6 CFR part 17; Department of Housing and Urban 
Development, 24 CFR part 3; Department of the Interior, 43 CFR part 
41; Department of Justice, 28 CFR part 54; Department of Labor, 29 
CFR part 36; Department of State, 22 CFR part 146; Department of 
Transportation, 49 CFR part 25; Department of the Treasury, 31 CFR 
part 28; Department of Veterans Affairs, 38 CFR part 23; 
Environmental Protection Agency, 40 CFR part 5; Federal Emergency 
Management Agency, 44 CFR part 19; General Services Administration, 
41 CFR part 101-4; National Aeronautics and Space Administration, 14 
CFR part 1253; National Archives and Records Administration, 36 CFR 
part 1211; National Science Foundation, 45 CFR part 618; Nuclear 
Regulatory Commission, 10 CFR part 5; Small Business Administration, 
13 CFR part 113; and Tennessee Valley Authority, 18 CFR part 1317.
---------------------------------------------------------------------------

    Response: OCR's determination to not incorporate title IX's 
abortion neutrality provision is based on our conclusion that doing so 
is not required and unnecessary as the ACA itself speaks to this issue. 
The ACA provides that nothing in the statute, including section 1557, 
has ``any effect on Federal laws regarding (i) conscience protection; 
(ii) willingness or refusal to provide abortion; and (iii) 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.'' 42 U.S.C. 18023(c)(2)(A). By contrast, 
the ACA does not contain specific language directing the incorporation 
of title IX's abortion neutrality provision. That section 1557 does not 
require its incorporation is therefore the better reading of the 
statute with regard to title IX. We reiterate, moreover, that this rule 
does not--and indeed, cannot--create a right to abortion; it operates 
only to prohibit discrimination on specific prohibited grounds.
    Comment: Several commenters highlighted the differences between 
section 1557's coverage of health care from title IX's coverage of 
education because the decision to receive health care from a particular 
provider is often driven by factors, including geographic location, 
cost, insurance coverage, the type of care being sought, and the 
urgency of that care. Many other commenters stated that importing title 
IX's abortion neutrality provision would allow denials of care that can 
directly harm patients, including putting at risk a patient's life or 
health.
    Response: OCR agrees with commenters that health care is 
fundamentally different from education. And although section 1557 
incorporates ``the ground prohibited under'' title IX and the 
``enforcement mechanisms provided for and available under'' that 
statute, 42 U.S.C. 18116(a), it does not incorporate title IX's other 
provisions. Title IX's abortion neutrality provision does not purport 
to define what constitutes prohibited sex discrimination under title 
IX--the ``ground prohibited'' under that statute--and it is not an 
enforcement mechanism; it provides only that nothing in title IX shall 
be construed to require or prohibit any person or entity to provide or 
pay for abortion or related benefit or service.
    Congress made clear that the ACA, including section 1557, would 
have no effect on several specific Federal laws protecting individuals 
and entities that refuse to provide abortions. See 42 U.S.C. 
18023(c)(2)(A). The ACA itself restates provisions of longstanding 
Federal law by making clear in 18023(c)(2)(A) that ``nothing in this 
act shall be construed to have effect on federal laws regarding--(i) 
conscience protections; (ii) willingness or refusal to provide 
abortion; and (iii) discrimination on the basis of willingness or 
refusal to provide, pay for, cover, or refer for abortion or to provide 
or participate in training to provide abortion.'' These provisions 
reiterate existing Federal restrictions on abortion. For example, the 
Weldon Amendment forbids funds appropriated to HHS from being ``made 
available to a Federal agency or program, or to a State or local 
government, if such agency, program, or government subjects any 
institutional or individual health care entity to discrimination on the 
basis that the health care entity does not provide, pay for, provide 
coverage of, or refer for abortions.'' \306\ The Coats-Snowe Amendment 
forbids discriminating against an entity that refuses to undergo 
training in performance of or referrals for abortions.\307\ The Church 
Amendment forbids requiring any individual ``to perform or assist in 
the performance of any part of a health service program . . . if his 
performance or assistance in the performance of such part of such 
program . . . would be contrary to his religious beliefs or moral 
convictions.'' \308\ It also provides that an entity's receipt of any 
grant, contract, loan, or loan guarantee under the Public Health 
Service Act, the Community Mental Health Centers Act, or the 
Developmental Disabilities Services and Facilities Construction Act 
``does not authorize any court or any public official or other public 
authority to require . . . such entity to . . . make its facilities 
available for the performance of any sterilization procedure or 
abortion if the performance of such procedure or abortion in such 
facilities is prohibited by the entity on the basis of religious 
beliefs or moral convictions.'' \309\ The Church Amendments also 
prohibit discrimination against health care personnel related to their 
employment or staff privileges because they ``performed or assisted in 
the performance of a lawful sterilization procedure or abortion.'' 
\310\ The same nondiscrimination protections also apply to health care 
personnel who refuse to perform or assist in the performance of 
sterilization procedures or abortion.\311\ In addition, some of HHS's 
programs and services are specifically governed by abortion 
restrictions in the underlying statutory authority or program 
authorization.\312\ The ACA also contains a variety of ``special 
rules'' that apply specifically to

[[Page 37638]]

abortion coverage and services.\313\ Each of these laws continues to 
apply and is not affected by this rule. Accordingly, it is not 
necessary to incorporate title IX's abortion neutrality provision.
---------------------------------------------------------------------------

    \306\ Consol. Appropriations Act, 2024, Public Law 118-47, div. 
H, tit. V, section 507(d)(1), 138 Stat. 460, 703 (Mar. 23, 2024). 
See also, e.g., id. sections 506-07, 138 Stat. 460, 703 (Hyde 
Amendment provisions).
    \307\ 42 U.S.C. 238n(a).
    \308\ 42 U.S.C. 300a-7(d).
    \309\ 42 U.S.C. 300a-7(b)(2)(A).
    \310\ 42 U.S.C. 300a-7(c)(1); see also U.S. Dep't of Health & 
Hum. Servs., Guidance on Nondiscrimination Protections under the 
Church Amendments, https://www.hhs.gov/conscience/conscience-protections/guidance-church-amendments-protections/.
    \311\ 42 U.S.C. 300a-7(c)(1).
    \312\ See, e.g., title X of the PHS Act, 24 U.S.C. 300a-6; 
section 1303(b)(4) of the ACA, 42 U.S.C. 18023.
    \313\ See 42 U.S.C. 18023(b).
---------------------------------------------------------------------------

    OCR emphasizes that a covered provider's decision not to provide 
abortions or abortion coverage does not itself constitute 
discrimination in violation section 1557. As described above, section 
1557 prohibits discrimination on the basis of race, color, national 
origin, sex, age, or disability in covered health programs or 
activities. As such there may be nondiscriminatory reasons for a 
provider not to offer abortion care or coverage. A covered entity does 
not engage in discrimination prohibited by section 1557 if it declines 
to provide abortions based on religious or conscience objections to 
performing the procedure, based on a professional or business judgment 
about the scope of the services it wishes to offer, or for any other 
nondiscriminatory reason.
    Comment: Many commenters who supported OCR's proposal noted that 
section 1557 does not require incorporation of title IX's abortion 
neutrality provision because if Congress wanted to include such a 
provision, it would have done so either by explicitly referencing title 
IX's abortion neutrality provision or by including text matching 20 
U.S.C. 1688. Commenters suggested that silence on the incorporation or 
importation of title IX's abortion neutrality provision is not an 
oversight on the part of Congress, but instead an intentional decision, 
as Congress legislates with knowledge of the basic rules of statutory 
construction.
    Many commenters stated that the Congressional drafters of section 
1557 did not pick and choose among the multiple title IX exceptions, 
including those specific to military training, admissions decisions, 
and membership practices of certain tax-exempt organizations, and that 
there is no justification for OCR to do so either. They maintained that 
the statute only references title IX for the prohibition of sex 
discrimination. Commenters also said there was no need to import title 
IX's abortion neutrality provision given the availability of existing 
Federal statutory protections for covered entities and individuals who 
object to the provision, payment, or referral of abortion services. 
Many commenters noted that OCR proposed a process in which a covered 
entity could seek an exemption based on conscience or religious 
conflicts. These commenters argued that, where permitted by relevant 
Federal laws, such analysis by OCR would also account for any potential 
harm to third parties.
    Response: For the reasons we set forth above, OCR maintains that 
importing title IX's abortion neutrality provision in this rule is not 
legally required by the statute.
    Comment: Other commenters who supported not importing the title IX 
abortion neutrality provision suggested that the final rule should 
include the Proposed Rule's discussion that EMTALA protects emergency 
care for pregnancy-related conditions, including termination of 
pregnancy. Some commenters expressed that the final rule should make 
clear that section 1557 incorporates section 1303(d) of the ACA, 42 
U.S.C. 18023(d), which states that nothing in title I of the ACA 
relieves any health care provider from providing emergency services as 
required by EMTALA.
    Response: OCR does not enforce EMTALA and directs commenters to the 
discussion of EMTALA under Sec.  92.3. OCR notes that the 2022 NPRM's 
discussion of EMTALA does not alter any requirements under section 
1557, EMTALA's existing obligations, or the Department's previous 
guidance regarding EMTALA. Nothing in this rule changes or otherwise 
affects any health care provider's obligations with respect to EMTALA, 
including with respect to the rights, remedies, procedures, or legal 
standards available to individuals and entities under section 1303(c) 
of the ACA.
    Comment: Many commenters objected to OCR's proposal that it was not 
required to import title IX's abortion neutrality provision in this 
rule. These commenters argued that the provision must be included to 
explicitly address that section 1557 and its implementing regulations 
are abortion neutral. Some commenters maintained that the 2022 NPRM's 
request for comment on whether ``it could be beneficial to include a 
provision specifically prohibiting discrimination on the basis of 
pregnancy-related conditions as a form of sex-based discrimination,'' 
87 FR 47879, constituted an ``abortion mandate'' that would 
discriminate against providers and covered entities who object to 
abortion. Some commenters stated that the inclusion of ``pregnancy or 
related conditions'' as a form of sex discrimination without importing 
title IX's abortion neutrality provision would strip providers of their 
ability to object to pregnancy terminations. Some commenters 
acknowledged that other Federal laws exist to protect religious freedom 
and conscience, but nevertheless expressed concerns that absent the 
provision's adoption of title IX's abortion neutrality provision, 
health care providers and entities with religious objections would be 
left without protections and would be forced to provide, cover, pay, or 
refer for abortion services.
    Response: OCR appreciates commenters' concerns, but for the reasons 
stated above, we disagree. A covered entity does not engage in 
discrimination prohibited by section 1557 if it declines to provide, 
pay for, cover, or refer for abortions based on religious or conscience 
objections to performing the procedure. OCR also intends to enforce and 
comply with all applicable religious freedom and conscience 
protections, including section 1303 of the ACA, the Weldon, Church, and 
Coats-Snowe amendments, RFRA, and other applicable religious freedom 
and conscience laws. We have added a procedure for recipients whereby 
they may rely on such protections or seek assurance of those 
protections, if they wish. See Sec.  92.302.
    Comment: Other commenters who objected to the Department's position 
contended that, on the one hand, OCR was relying on title IX's 
regulations to prohibit discrimination on pregnancy-related conditions, 
while, on the other hand, ignoring title IX's statutory abortion 
neutrality provision and religious exception. These commenters argued 
that OCR is arbitrarily and capriciously picking and choosing which 
provisions of title IX to implement. They stated that, under title IX, 
declining to provide or pay for any service related to abortion is not 
treated as prohibited sex discrimination and therefore it cannot be 
that the same action, under section 1557, could constitute prohibited 
sex discrimination. Several commenters argued that the abortion 
neutrality provision, unlike title IX's exceptions, is a rule of 
construction that applies to all of title IX, including the statute's 
prohibition on sex discrimination, and thus OCR must incorporate the 
provision into any section 1557 implementing regulations.
    Response: OCR appreciates commenters' concerns. As we explained 
above, however, section 1557 incorporates some, but not all, parts of 
title VI, title IX, the Age Act, and section 504. Specifically, section 
1557 incorporates the ``ground'' of discrimination and the 
``enforcement mechanisms'' under the referenced statutes, including 
title IX. Section 1557 is best read to incorporate existing 
interpretations of what constitutes sex discrimination under title IX, 
including regulatory interpretations and case law.

[[Page 37639]]

But section 1557 does not incorporate provisions of title IX or that 
statute's regulations that do not define or interpret what constitutes 
a ground of discrimination or an enforcement mechanism. Those 
provisions include the religious exception and the abortion neutrality 
provision. This reading gives meaning to every term in section 1557, 
while recognizing that although the statute incorporates parts of other 
civil rights statutes, each statute addresses distinct issues and 
contexts. Title IX's abortion neutrality provision is a rule of 
construction as to what acts can be required of recipients under title 
IX, but nothing in the provision states that it construes what 
constitutes a ground of prohibited discrimination. In section 1557, 
Congress was explicit in the limited incorporation of title IX when it 
listed only the ground to be prohibited by itle IX and the enforcement 
mechanisms that apply, and the title IX abortion neutrality provision 
is not an enforcement mechanism.
    Comment: Many commenters stated that OCR's proposal to not import 
the title IX abortion neutrality provision is contrary to Congress's 
intent when it drafted section 1557 and explicitly adopted by reference 
the entire title IX scheme under 20 U.S.C. 1681 et seq. Commenters 
stated that enactment of title IX did not simply prohibit sex 
discrimination, because at least two categories of conduct are not, in 
Congress's view, what constitutes sex discrimination for purposes of 
title IX--religious decisions by an entity that conflict with the terms 
of title IX and the refusal to provide or pay for abortion. In their 
view, this means that OCR cannot prohibit discrimination based on 
termination of pregnancy or abortion as a form of sex discrimination.
    Response: OCR appreciates commenters' concerns but disagrees that 
the manner in which Congress chose to cite title IX in section 1557 
indicates an intent to limit what constitutes discrimination of the 
basis of sex for the reasons stated above. OCR specifically disagrees 
that the inclusion of ``et seq.'' indicates Congress's intent to 
incorporate the entire statute, thereby negating Congress's use of the 
terms ``ground prohibited'' and ``enforcement mechanisms'' when 
describing which portions of title IX shall be incorporated in section 
1557. Moreover, as discussed in detail above (see Treatment of the 
Title IX Religious Exception), OCR's analysis considers the entire 
statute, including title IX's specific limitation to the context of 
educational programs and activities.
    Comment: Commenters argued that title IX's adoption by reference 
supports Congress's longstanding position to legislate in a manner that 
remains neutral with respect to abortion. In support of this view, some 
commenters pointed to the Pregnancy Discrimination Act of 1978, where 
Congress prohibits discrimination on the basis of pregnancy, 
childbirth, or related medical conditions, but also explicitly included 
an exemption for health insurance benefits for abortion which, in their 
view, demonstrates Congress's intent to remain neutral on abortion.
    Response: OCR will adhere to the specific terms Congress enacted in 
section 1557 as well as other applicable Federal laws, including 
section 1303 of the ACA, the Weldon, Church, and Coats-Snowe 
amendments, RFRA, and other applicable religious freedom and conscience 
laws.
    Comment: Other commenters who objected to OCR's proposal not to 
import title IX's abortion neutrality provision in the rule expressed 
concern that OCR ignored section 1303 of the ACA, 42 U.S.C. 18023, 
which they opine requires abortion neutrality throughout the ACA. For 
example, commenters discuss that section 1303(a), which gives States 
the option to prohibit abortion coverage in health plans, would be 
rendered meaningless if the final rule requires such coverage by either 
prohibiting discrimination on the basis of pregnancy-related conditions 
or by failing to include a provision establishing section 1557's 
abortion neutrality. Commenters stated that section 1303 forecloses any 
construction of section 1557 that would require the provision or 
coverage of abortion.
    Response: OCR appreciates commenters' concerns regarding section 
1303's applicability to section 1557. Section 1303(a) provides that 
States and qualified health plans may, to the extent allowed by State 
law, opt to offer or prohibit abortion coverage; it does not require 
that section 1557 to import the language of title IX's abortion 
neutrality provision. Section 1303 primarily grants States flexibility 
to decide whether qualified health plans sold through their respective 
Exchanges can include coverage benefits for abortion services. See 42 
U.S.C. 18023(a) (``State opt-out of abortion coverage''). And, unless 
otherwise prohibited by State law, participating issuers may elect to 
cover abortion services in qualified health plans. For qualified health 
plans that elect to offer as a coverage benefit abortion services for 
which Federal funding is prohibited, section 1303 establishes separate 
accounting requirements to ensure Federal funds are segregated and 
maintained separate from a policy holder's out-of-pocket funds, which 
may pay for abortion coverage. 42 U.S.C. 18023(b)(2)(B)-(C). OCR 
acknowledges that section 1303 allows qualified health plans the 
independence to choose whether to provide abortion coverage where 
consistent with State law, but it does not command that the final rule 
import title IX's abortion neutrality provision.
    OCR reiterates, moreover, that a covered provider's decision not to 
provide abortions or abortion coverage does not itself constitute 
discrimination in violation of section 1557. A covered entity that 
generally offered abortion care could violate section 1557 if, for 
example, it refused to provide an abortion to a particular patient 
because of their race or disability. But a covered provider does not 
engage in discrimination prohibited by section 1557 if it declines to 
provide abortions based on religious or conscience objections to 
performing the procedure, based on a professional or business judgment 
about the scope of the services it wishes to offer, or for any other 
nondiscriminatory reason. Further, OCR maintains that importing title 
IX's abortion neutrality provision is not required given the 
recognition of the ACA provisions on abortion and the inclusion of 
those provisions in regulatory text.
    Comment: Several commenters pointed to the Weldon and Church 
Amendments to assert that OCR does not have the authority to prohibit 
discrimination on the basis of pregnancy termination and requested that 
OCR include title IX's abortion neutrality provision to avoid any 
uncertainty on the issue. Other commenters urged OCR to include 
affirmative language in the final rule that section 1557 does not 
require the provision of, referral for, or coverage of abortion to 
eliminate any uncertainty maintained by many religious providers.
    Response: OCR remains committed to upholding the Federal laws, 
including the abortion and conscience provisions of the ACA itself, the 
Church, Coats-Snowe, and Weldon Amendments; the generally applicable 
requirements of RFRA; and other applicable Federal laws that provide 
protection to covered entities. It is not necessary to include title 
IX's abortion neutrality provision in the final rule to provide 
certainty as to the safeguards in place to protect religious freedom 
and conscience. As discussed, a covered entity does not engage in 
discrimination prohibited by section 1557 if it declines to provide 
abortions based on religious or conscience objections to performing the 
procedure. Also, we refer again to the process described at Sec.  
92.302, whereby

[[Page 37640]]

providers may rely on the protections in Federal law for religious 
freedom and conscience or seek assurance of such protections from OCR, 
if they wish.
    Comment: Many commenters who objected to OCR's proposal not to 
import title IX's abortion neutrality provision in this rule expressed 
concern regarding the Proposed Rule's discussion of EMTALA and 
emergency medical conditions that may necessitate abortion. Some 
commenters opined that the Proposed Rule's preamble was a potential 
regulatory change by HHS to designate an ``abortion mandate'' in 
EMTALA. Some commenters also noted that such an ``abortion mandate'' 
meant that HHS could preempt State laws that prohibit abortion or alter 
State licensing and health and safety laws. Other commenters raised the 
``major questions'' legal doctrine to conclude that Congress would not 
have granted HHS the authority to promulgate such rules that would 
rewrite the text of EMTALA on any grounds, including on the issue of 
abortion.
    Response: These comments fall outside the scope of the final rule. 
To be clear, EMTALA does not alter any of section 1557's requirements, 
and this rule does not alter existing obligations under EMTALA, or any 
of the Department's previous guidance regarding EMTALA. Thus, nothing 
about the final rule imposes any change to EMTALA's statutory scheme, 
let alone a ``radical or fundamental change'' such that the major 
questions doctrine is implicated.\314\ Further, commenters' view that 
the ``major questions'' legal doctrine applies is also misplaced. The 
``major questions'' doctrine applies in certain ``extraordinary cases'' 
in which courts will refuse to defer to agency action it considers 
having ``vast economic and political significance'' absent express 
authorization from Congress.\315\ As described, the final rule does not 
alter any existing obligations or guidance as to EMTALA. The ``major 
questions'' doctrine is not relevant here.
---------------------------------------------------------------------------

    \314\ West Virginia v. EPA, 597 U.S. 697, 723 (2022).
    \315\ West Virginia v. EPA, 597 U.S. at 716 (Invalidating the 
Environmental Protection Agency's plan to require power plants to 
shift from coal to renewables, reducing gross domestic product by at 
least a trillion dollars within two decades); Nat'l Fed. of Indep. 
Business v. OSHA, 142 S. Ct. 661, 665 (2022) (per curiam) 
(Invalidating the Occupational Safety and Health Administration 
order requiring ``84 million Americans to either obtain a COVID-19 
vaccine or undergo weekly medical testing'').
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    Additionally, there is no basis for commenters' concerns about a 
potential regulatory change or preemption of State laws, including 
those involving licensing and health and safety. Per the ACA itself, 
this rule does not override State laws regarding ``the prohibition of 
(or requirement of) coverage, funding, or procedural requirements on 
abortions'' or alter preexisting obligations under Federal law. See 42 
U.S.C. 18023(c)(1), (d).
    Comment: Other commenters stated that the Franciscan Alliance 
opinion vacating provisions similarly related to pregnancy-related 
conditions in the 2016 Rule precludes OCR from issuing this final rule 
with similar provisions that do not import title IX's abortion 
neutrality provision. Some commenters maintained that if OCR 
promulgates this rule with similar provisions, OCR risks being held in 
contempt of court. Other commenters stated that to adequately issue 
this final rule, OCR must explain why the holdings of the Franciscan 
Alliance court are incorrect or inapplicable to this rulemaking.
    Response: OCR appreciates commenters' concerns, but notes that they 
mischaracterize the impact of the relief ordered in Franciscan Alliance 
on this rulemaking. The Franciscan Alliance court vacated a portion of 
the 2016 Rule--namely its interpretation of sex discrimination to 
include gender identity and termination of pregnancy.\316\ The court 
also enjoined the Federal Government from interpreting or enforcing 
section 1557 or any related implementing regulations against the 
plaintiffs in that particular case in a manner that would require those 
plaintiffs to perform or provide insurance coverage for gender-
transition procedures or abortions.\317\ The court's orders have no 
effect on, and do not apply to, OCR's authority to promulgate new 
regulations, including this final rule, and to enforce those 
regulations against covered entities that were not plaintiffs in 
Franciscan Alliance. The instant rulemaking is new and includes 
significant changes that address concerns raised against the 2016 Rule 
in Franciscan Alliance. Also notable is the fact that Sec.  92.302 
outlines new procedures whereby persons may rely on the protections of 
Federal conscience or religious freedom laws or choose to seek 
assurance of such protections, if they wish. And OCR has issued a 
separate final rule codifying safeguards for Federal conscience 
protections. See 89 FR 2078 (Jan. 11, 2024). In addition, OCR has 
considered the legal and factual developments since the issuance of the 
2016 Rule, which help to inform its decisions in this final rule. 
Therefore, OCR's promulgation of its new regulation in no way 
contravenes the Franciscan Alliance court's orders, and OCR will comply 
with that court's orders, and all other applicable orders, in enforcing 
this final rule. OCR thus disagrees that issuing this rule puts the 
agency at risk of being held in contempt, merely for acting within the 
authority that has been lawfully delegated to HHS under section 1557.
---------------------------------------------------------------------------

    \316\ Franciscan All., Inc. v. Azar, 414 F. Supp. 3d 928, 945-47 
(N.D. Tex. 2019).
    \317\ Franciscan All., Inc. v. Becerra, 553 F. Supp. 3d 361, 378 
(N.D. Tex. 2021).
---------------------------------------------------------------------------

    Comment: Some commenters requested that OCR provide clarification, 
either in a final rule or via sub-regulatory guidance, as to how the 
proposed pregnancy discrimination protections relate to and may be 
different from those guaranteed by the Pregnancy Discrimination Act of 
1978.
    Response: OCR appreciates these commenters' request and is intent 
on providing clear guidance on the scope of the final rule and its 
application through educational outreach efforts, trainings, and 
individualized assistance. OCR clarifies that it does not enforce the 
Pregnancy Discrimination Act of 1978, Public Law 95-555, which amended 
title VII, and applies to discrimination on the basis of pregnancy, 
childbirth, or related medical conditions in employment settings, while 
section 1557 applies to health programs or activities that receive 
Federal financial assistance. We also note that section 1557, title IX, 
and title VII are read consistently to apply similar protections in the 
different contexts in which they apply.
    Comment: Other commenters expressed concern that Dobbs created 
tension between health care providers and patients, increasing distrust 
in providers. Commenters also stated that Dobbs has created chaos in 
the health care system, increasing the risk that patients will 
experience discriminatory care and suffer delays in lifesaving 
treatment as a direct result of legal and medical uncertainty. These 
commenters said that discrimination in care propagates more distrust, 
which is a significant barrier for individuals seeking care and is 
precisely what section 1557 was designed to protect against.
    Response: OCR appreciates the commenters' concerns. OCR understands 
that the provider-patient relationship is critical to the provision of 
quality, competent health care and critical for achieving optimal 
health. For example, in proposing the policies and procedures required 
under Sec.  92.8, OCR confirmed that patients value the ability to have 
their concerns directly heard by

[[Page 37641]]

their provider,\318\ and understands that not all communities in the 
United States feel the same level of trust in their health care 
provider, particularly among racially and ethnically diverse 
communities.\319\ OCR further recognizes that in light of Dobbs, in 
certain States, a patient may fear sharing critical information 
relevant to their health status. OCR is separately considering 
revisions to the HIPAA Privacy Rule to strengthen privacy protections 
for individuals' protected health information related to reproductive 
health care, which will assist in generating more trusting patient-
provider relationships. See HIPAA Privacy Rule To Support Reproductive 
Health Care Privacy, notice of proposed rulemaking, 88 FR 23506 (Apr. 
17, 2023).
---------------------------------------------------------------------------

    \318\ Leslie Read et al., The Deloitte Ctr. for Health 
Solutions, Rebuilding Trust in Health Care: What Do Consumers Want--
and Need--Organizations to Do?, p. 3 (2021) (``62% [of surveyed 
people of color] want their local hospitals to ensure patients have 
a voice to relay their experiences and take action to address their 
problems.''), https://www2.deloitte.com/us/en/insights/industry/health-care/trust-in-health-care-system.html.
    \319\ Leslie Read et al., The Deloitte Ctr. for Health 
Solutions, Rebuilding Trust in Health Care: What Do Consumers Want--
and Need--Organizations to Do? (2021); https://www2.deloitte.com/us/en/insights/industry/health-care/trust-in-health-care-system.html.
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Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.208, with modification. For clarity, we are finalizing by 
adding a cross-reference to Sec.  92.101(a)(2)'s description of sex 
discrimination.
Nondiscrimination on the Basis of Association (Sec.  92.209)
    In Sec.  92.209, we proposed prohibiting discrimination against an 
individual on the basis of the race, color, national origin, sex, age, 
or disability of an individual with whom the individual is known to 
have a relationship or association.
    The comments and our responses regarding proposed Sec.  92.209 are 
set forth below.
    Comment: Commenters on this provision overwhelmingly expressed 
support for the inclusion of an explicit prohibition on associational 
discrimination, which many stated will protect individuals, including 
children and elders, who associate with LGBTQI+ individuals. Other 
commenters said that a prohibition of associational discrimination will 
also protect individuals and families who associate with an individual 
who has a history of drug use or substance use disorder (SUD). Some 
commenters noted that the 2020 Rule repealed the 2016 Rule's 
associational discrimination protections at former 45 CFR 92.209, 
despite comments urging OCR to maintain the provision. Many commenters 
noted that courts have recognized an individual's right to be free from 
discrimination based on their association with another an individual 
protected on one or more bases under section 1557.\320\
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    \320\ Falls v. Prince George's Hosp. Ctr., No. Civ. A 97-1545, 
1999 WL 33485550 at *11 (D. Md. Mar. 16, 1999) (holding that parent 
had an associational discrimination claim under section 504 when 
hospital required hearing parent to act as interpreter for child who 
was deaf); Holcomb v. Iona Coll., 521 F.3d 130 (2nd Cir. 2008) (an 
employee has a cognizable title VII claim against an employer who 
takes an adverse action against the employee because of the 
employee's association with a person of another race); Larimer v. 
Int'l Bus. Machines Corp., 370 F.3d 698, 702 (7th Cir. 2004) (the 
court affirmed lower court's summary judgment in favor of defendant 
employer, in part, because plaintiff employee's employment claim did 
not fit into any one of three recognized categories of associational 
discrimination under the ADA); Loeffler v. Staten Island Univ. 
Hosp., 582 F.3d 268, 279 (2d. Cir. 2009) (court permitted 
associational discrimination claim brought by deaf father's children 
who were forced to interpret for him in the hospital); Mx Grp., Inc. 
v. City of Covington, 293 F.3d 326, 335 (6th Cir. 2002) (holding a 
drug and alcohol treatment center that was wrongfully denied a 
zoning permit because it provided services to individuals with 
disabilities was subjected to discrimination under title II of the 
ADA); Barrett v. Whirlpool Corp., 556 F.3d 502, 512 (6th Cir. 2009) 
(title VII and sec. 1981 forbid employment discrimination on the 
basis of association with or advocacy for a protected party); Tetro 
v. Elliot Popham Pontiac, Oldsmobile, Buick, & GMC Trucks, Inc., 173 
F.3d 988, 994-95 (6th Cir. 1999) (court reversed lower court's 
dismissal of plaintiff's associational discrimination claim because 
title VII prohibits such discrimination); Deffenbaugh-Williams v. 
Wal-Mart Stores, Inc., 156 F.3d 581, 589 (5th Cir. 1998) (court 
upheld jury's determination that employer wrongfully terminated 
employee based on employee's association with a Black person) 
vacated in part on other grounds by Williams v. Wal-Mart Stores, 
Inc., 182 F.3d 333 (5th Cir. 1999) (en banc); Parr v. Woodmen of the 
World Life Ins. Co., 791 F.2d 888, 892 (11th Cir. 1986) (trial court 
erred in dismissing plaintiff's associational discrimination claim 
because Sec.  1981 prohibits associational discrimination); Hively 
v. Ivy Tech Cmty. Coll. of Ind., 853 F.3d 339, 345 (7th Cir. 2017) 
(finding plaintiff had a case for sex discrimination in part based 
on the gender and orientation of her partner); Zarda v. Altitude 
Express, 883 F.3d 100, 124 (2d Cir. 2018), (court held that 
prohibition of associational discrimination applies with equal force 
to all the classes protected by title VII); Videckis v. Pepperdine 
Univ., 150 F. Supp. 3d 1151, 1161 (C.D. Cal. 2015) (sexual 
orientation discrimination is sex discrimination in part because it 
involves treatment that was based on the sex of the person(s) with 
whom the individual associates); Baldwin v. Foxx, 2015 WL 4397641 
(EEOC July 15, 2015) (``Sexual orientation discrimination is also 
sex discrimination because it is associational discrimination on the 
basis of sex.''); Kauffman v. Maxim Healthcare Servs., Inc., No. 04-
CV-2869, 2006 WL 1983196, at *3 (E.D.N.Y. July 13, 2006) (``Although 
Defendant correctly points out that the Second Circuit has not 
recognized as valid causes of action third-party claims of 
association discrimination or retaliation like those presented in 
the instant case, there is nevertheless a wealth of support in the 
prior decisions of the courts in this Circuit and our highest Court 
for recognizing these types of claims.'').
---------------------------------------------------------------------------

    Response: OCR agrees that it is important to include an explicit 
provision addressing associational discrimination, as both consistent 
with courts' interpretation of what constitutes discrimination as well 
as to protect those experiencing such forms of discrimination.\321\ As 
commenters noted, this particularly impacts LGBTQI+ people because 
significant numbers of children and elders live with or are cared for 
by LGBTQI+ people,\322\ and some providers have refused to provide 
health care to children, for example, because their parents are gay or 
lesbian.\323\ This is

[[Page 37642]]

likely also to be particularly important for people, especially 
children, who cannot access health care without the support of a 
caregiver. Such conduct by a covered entity may violate this provision 
and other provisions of this part, including Sec. Sec.  92.101 
(Discrimination prohibited), 92.206 (Equal program access on the basis 
of sex), 92.207 (Nondiscrimination in health insurance coverage and 
other health-related coverage), and 92.208 (Prohibition on sex 
discrimination related to marital, parental, or family status). 
Additionally, associational or caregiver discrimination also frequently 
arises in the context of disability discrimination, as addressed above 
in the preamble discussion of Sec.  92.202 (Effective communication for 
individuals with disabilities). Another potential example of 
discrimination based on association relates to individuals with a 
substance use disorder (SUD) \324\ and related stigma.\325\ The ADA, 
section 504, and section 1557 prohibit discrimination on the basis of 
disability, and individuals with an SUD or a history of having an SUD 
typically are protected under these authorities, unless they are 
engaged in the current illegal use of drugs.\326\ Section 92.209 makes 
clear that discrimination against individuals (including friends, 
nonfamilial caregivers, and family members) based on their association 
with individuals in recovery from SUD or with a history of drug use is 
prohibited under section 1557.
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    \321\ See Kengerski v. Harper, 6 F.4th 531, 537-539 (3d Cir. 
2021) (a white plaintiff employee's claim is justiciable under an 
associational discrimination legal theory under title VII of the 
Civil Rights Act of 1964, where his employer retaliated against him 
for complaining about a supervisor's racist remarks directed at the 
employee's biracial family member and other minority coworkers); 
Kelleher v. Fred A. Cook, Inc., 939 F.3d 465, 469-470 (2d Cir. 2019) 
(an employer's reaction to a non-disabled employee's reasonable 
accommodation request to care for disabled dependent can support an 
inference of associational discrimination); McGinest v. GTE Serv. 
Corp., 360 F.3d 1103, 1118 (9th Cir. 2004) (case involving indirect 
comments in the workplace that crossed racial lines, noting that 
``Title VII has . . . been held to protect against adverse 
employment actions taken because of the employee's close association 
with black friends or coworkers'') (internal citations omitted); 
Johnson v. Univ. of Cincinnati, 215 F.3d 561, 574 (6th Cir. 2001) (a 
plaintiff who is not a member of a recognized protected class 
nevertheless alleges a cognizable discrimination claim under title 
VII and 42 U.S.C. 1981 if he alleges that he was discriminated 
against based on his association with a member of a recognized 
protected class); Tetro v. Elliot Popham Pontiac, Oldsmobile, Buick 
& GMC Trucks Inc., 173 F.3d 988, 994-95 (6th Cir. 1999) (holding 
that white plaintiff with biracial child stated a claim under title 
VII based on his own race ``even though the root animus for the 
discrimination is a prejudice against the biracial child''); Parr v. 
Woodmen of the World Life Ins., 791 F.2d 888, 892 (11th Cir. 1986) 
(``Where a plaintiff claims discrimination based upon an interracial 
marriage or association, he alleges by definition that he has been 
discriminated against because of his race.''). Cf. Loving v. Va., 
388 U.S. 1 (1967).
    \322\ Family Equality Council, LGBTQ Family Fact Sheet, https://www2.census.gov/cac/nac/meetings/2017-11/LGBTQ-families-factsheet.pdf, (as of 2017, between 2 and 3.7 million children in 
the US have LGBTQ+ parents); Family Equality Council, LGBTQ Family 
Building Survey (2019), https://www.familyequality.org/wp-content/uploads/2019/02/LGBTQ-Family-Building-Study_Jan2019-1.pdf (77 
percent of LGBTQ+ millennials either are already parents or are 
considering expanding their families in the years ahead); SAGE, 
Caregiving in the LGBT Community (2017), https://www.lgbtagingcenter.org/resources/pdfs/SAGE%20Caregiver%20Guide%20Final%20Interactive.pdf (approximately 3 
million LGBTQ+ people are the primary caregiver for someone over the 
age of 50).
    \323\ Tresa Baldas, Pediatrician Won't Treat Baby With 2 Moms, 
USA Today (Feb. 18, 2015), https://www.usatoday.com/story/news/nation/2015/02/18/doctor-discrimination-baby/23642091/.
    \324\ Substance Use Disorder Demographics, American Addiction 
Centers, (Dec. 9, 2022), https://sunrisehouse.com/addiction-demographics (more than 40 million Americans aged 12 or older 
suffered from a substance use disorder in 2020).
    \325\ Janet Zwick et al., Stigma: How It Effects the Substance 
Use Disorder Patient, 15 Substance Abuse Treatment, Prevention, & 
Pol., (2020), https://link.springer.com/article/10.1186/s13011-020-00288-0 (Stigma serves as a barrier to individuals with SUD seeking 
help, entering treatment, and accepting medications.).
    \326\ See, e.g., U.S. Dep't of Justice, The ADA and Opioid Use 
Disorder: Combatting Discrimination Against People in Treatment and 
Recovery (Apr. 5, 2022), https://www.ada.gov/resources/opioid-use-disorder/.
---------------------------------------------------------------------------

    Comment: One commenter accurately observed that, unlike the 
Proposed Rule, the 2016 Rule's associational nondiscrimination 
provision referenced protections for both individuals and entities that 
associate with others. Emphasizing that an entity can also be 
discriminated against by other covered entities based on the original 
entity's association with an individual due to the individual's race, 
color, national origin, sex, disability or age, this commenter 
described a scenario where a health plan might discriminate against an 
entity that largely serves patients with LEP, LGBTQI+ populations, or 
an entity that provides Medications for Opioid Use Disorder (MOUD) to 
individuals with opioid use disorder.
    Response: OCR recognizes that there may be instances where covered 
entities may discriminate against other entities based on these other 
entities' associations with populations they serve (including LGBTQI+ 
individuals, individuals with disabilities, etc.). For example, Sec.  
92.209 prohibits a covered entity from discriminating against another 
entity because that entity serves individuals protected under this 
rule, e.g., individuals with SUD,\327\ people with intellectual and 
developmental disabilities, people of a particular race or national 
origin, or people of a particular age. In this case, Sec.  92.209 is 
violated based on the discriminated-against entity's association with 
an individual or individuals based on their race, color, national 
origin, sex, age, or disability. OCR did not intend to suggest in the 
Proposed Rule that this was no longer considered a prohibited form of 
discrimination and therefore is including ``entity'' in the final rule 
text.
---------------------------------------------------------------------------

    \327\ See MX Grp., Inc. v. City of Covington, 293 F.3d 326, 335 
(6th Cir. 2002) (a public entity violated title II of the ADA when 
it discriminated against a drug and alcohol treatment center by 
denying it a zoning permit because the center provided services to 
individuals with disabilities).
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Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.209, with modification. We have revised the provision to 
clarify that covered entities are prohibited from discriminating 
against individuals and entities under this provision by adding ``or 
entity'' in the following locations: ``. . . against an individual or 
entity . . .,'' and ``. . . with whom the individual or entity . . . 
.''
Nondiscrimination in the Use of Patient Care Decision Support Tools 
(Sec.  92.210)
    Proposed Sec.  92.210, entitled ``Use of clinical algorithms in 
decision-making,'' provided that a covered entity must not discriminate 
against any individual on the basis of race, color, national origin, 
sex, age, or disability through the use of clinical algorithms in its 
decision-making. We invited extensive public comment on this proposed 
provision, including on whether to limit the provision to clinical 
algorithms or to include additional forms of automated or augmented 
decision-making tools or models, such as artificial intelligence (AI) 
and machine learning, and whether the provision should include more 
specificity, such as explaining actions covered entities must take to 
identify and mitigate potential discrimination from these tools. 87 FR 
47884. The Proposed Rule preamble described clinical algorithms as 
``tools used to guide health care decision-making that could range in 
form from flowcharts and clinical guidelines to complex computer 
algorithms, decision support interventions, and models.'' 87 FR 47880. 
The preamble also described clinical algorithms as tools used by 
``hospitals, providers, and payers (e.g., health insurance issuers) . . 
. to assist with health care decision-making for various purposes,'' 
including ``screening, risk prediction, diagnosis, prognosis, clinical 
decision-making, treatment planning, health care operations, and 
allocation of resources, all of which affect the care that individuals 
receive.'' 87 FR 47880. The comments and our responses regarding Sec.  
92.210 are set forth below.
    Comment: Many commenters requested that OCR codify a definition for 
the term ``clinical algorithm.'' Some commenters requested a definition 
for ``clinical algorithm'' to include any form of automated decision 
systems and AI used in health programs or activities. Many commenters 
also recommended that Sec.  92.210 apply to tools used in a covered 
entity's health programs and activities in addition to those used in a 
clinical setting. These commenters suggested that Sec.  92.210 should 
apply to a covered entity's administrative health care operations 
because the use of these tools can impact individuals' access to a 
covered entity's health programs and activities and the quality of 
services provided.
    Arguing that the term ``clinical algorithm'' is insufficient, some 
commenters cited examples of tools that covered entities use in their 
health programs and activities, such as those used for budgeting and 
billing processes, utilization management, benefit design, program 
eligibility and enrollment, provider contracting, and pricing by 
providers and insurers which are susceptible to discriminatory bias. 
Commenters also identified tools used in skilled nursing facilities, 
tools used to allocate home and community-based services, and Medicaid 
eligibility systems.
    Response: In the Proposed Rule's preamble, we indicated that 
``clinical algorithms'' include tools beyond actual algorithms, 87 FR 
47880, and we solicited comment about whether ``clinical algorithms'' 
should ``include additional forms of automated or augmented decision-
making tools or models such as artificial intelligence or

[[Page 37643]]

machine learning,'' 87 FR 47884. The Proposed Rule described ``clinical 
algorithms'' as ``tools used to guide health care decision-making that 
can range in form from flowcharts and clinical guidelines to complex 
computer algorithms, decision support interventions, and models,'' 
which hospitals, providers and health insurance issuers use to ``assist 
with decision-making for various purposes,'' including ``screening, 
risk prediction, diagnosis, prognosis, clinical decision-making, 
treatment planning, health care operations, and allocation of 
resources, all of which affect the care that individuals receive.'' 87 
FR 47880 (emphases added). Thus, the Proposed Rule described clinical 
algorithms broadly to include a variety of health care decision-making 
tools in a covered entity's health programs and activities related to 
patient care. We further solicited comment about ``what types of 
clinical algorithms are being used in covered health programs and 
activities; how such algorithms are being used by covered entities; 
[and] whether they are more prevalent in certain health settings . . . 
.'' 87 FR 47884.
    As discussed in the preamble under Sec.  92.4, we are adopting the 
more precise term ``patient care decision support tool'' to replace the 
term ``clinical algorithm.'' This new term more closely aligns with 
what we described as ``clinical algorithms'' in the preamble to the 
Proposed Rule, such as various tools used to guide health care 
decision-making that affect the care that patients receive. See 87 FR 
47880. In Sec.  92.4, we define ``patient care decision support tool'' 
to mean ``any automated or non-automated tool, mechanism, method, 
technology, or combination thereof used by a covered entity to support 
clinical decision-making in its health programs or activities.'' The 
definition applies to tools that are used by a covered entity in its 
clinical decision-making that affect the patient care that individuals 
receive. Given covered entities' widespread use of automated decision 
systems and AI, and the scale by which AI can influence covered 
entities' clinical decision-making,\328\ we are confirming that the 
types of patient care decision support tools subject to Sec.  92.210 
include automated decision systems and AI used to support clinical 
decision-making.
---------------------------------------------------------------------------

    \328\ Nat'l Acad. of Med., Artificial Intelligence in Health 
Care: The Hope, the Hype, the Promise, the Peril, pp. 2, 3 (2019), 
https://doi.org/10.17226/27111; Nat'l Inst. of Standards & Tech., 
Artificial Intelligence Risk Management Framework (AI RMF 1.0), NIST 
AI 100-1, pp. 1, 17, 40 (2023), https://doi.org/10.6028/NIST.AI.100-1.
---------------------------------------------------------------------------

    Covered entities may use patient care decision support tools in 
their health care decision-making in a variety of ways. Covered 
entities typically use patient care decision support tools at the 
individual patient level, such as a provider using clinical guidance 
from an algorithm to assess a patient's risk of a severe cardiac 
event.\329\ Other patient care decision support tools pertain to health 
care administration decisions, typically used with regard to a group of 
patients (or a population) based on shared characteristics. For 
example, there is evidence that hospital system treatment protocol 
varies by geographic area due to variations produced by risk adjustment 
modeling.\330\ In addition to these examples, patient care decision 
support tools would also include tools used for prior authorization and 
medical necessity analysis,\331\ which directly impacts clinical 
decision-making and affects the care received by patients as directed 
by their providers. For example, a medical necessity review tool used 
by Medicare Advantage plans has been shown to deny enrollees' medical 
claims for rehabilitative care without considering enrollees' 
individual circumstances.\332\
---------------------------------------------------------------------------

    \329\ See, e.g., Darshali A. Vyas et al., Hidden in Plain 
Sight--Reconsidering the Use of Race Correction in Clinical 
Algorithms, 383 N. Engl. J. Med. 874, 876-78 (Aug. 27, 2020).
    \330\ Elliott Fisher et al., Health Care Spending, Quality, and 
Outcomes--More Isn't Always Better, The Dartmouth Inst. for Health 
Pol. & Clinical Practice (2009), https://www.ncbi.nlm.nih.gov/books/n/darthhcspending/pdf/; Ziad Obermeyer et al., Dissecting Racial 
Bias in an Algorithm Used to Manage the Health of Populations, 366 
Science 447 (2019), https://www.science.org/doi/10.1126/science.aax2342.
    \331\ See, e.g., Casey Ross & Bob Herman, UnitedHealth Pushed 
Employees to Follow an Algorithm to Cut Off Medicare Patients' Rehab 
Care, STAT News (Nov. 14, 2023), https://www.statnews.com/2023/11/14/unitedhealth-algorithm-medicare-advantage-investigation/; Patrick 
Rucker et al., How Cigna Saves Millions by Having Its Doctors Reject 
Claims Without Reading Them, ProPublica (March 25, 2023), https://www.propublica.org/article/cigna-pxdx-medical-health-insurance-rejection-claims; Casey Ross & Bob Herman, Denied by AI: How 
Medicare Advantage Plans Use Algorithms to Cut Off Care for Seniors 
in Need, STAT News, (Mar. 13, 2023) https://www.statnews.com/2023/03/13/medicare-advantage-plans-denial-artificial-intelligence/; 
Shahed Al-Haque et al., AI Ushers in Next-Gen Prior Authorization in 
Healthcare, McKinsey & Co. (Apr. 19, 2022), https://www.mckinsey.com/industries/healthcare/our-insights/ai-ushers-in-next-gen-prior-authorization-in-healthcare#/.
    \332\ See, e.g., Casey Ross & Bob Herman, Denied by AI: How 
Medicare Advantage Plans Use Algorithms to Cut Off Care for Seniors 
in Need, STAT News, https://www.statnews.com/2023/03/13/medicare-advantage-plans-denial-artificial-intelligence/ (Mar. 13, 2023).
---------------------------------------------------------------------------

    One subset of patient care decision support tools to which Sec.  
92.210 applies includes ``predictive decision support interventions'' 
as defined in the Office of the National Coordinator for Health 
Information Technology's (ONC) recently published final rule for 
``Health Data, Technology, and Interoperability: Certification Program 
Updates, Algorithm Transparency, and Information Sharing.'' \333\ In 
its rule, ONC defines the term ``predictive decision support 
intervention'' (Predictive DSI) to mean ``technology that supports 
decision-making based on algorithms or models that derive relationships 
from training data and then produce an output that results in 
prediction, classification, recommendation, evaluation, or analysis.'' 
89 FR 1192 (codified at 45 CFR 170.102). As ONC discussed in the 
Proposed Rule, Predictive DSI are used to predict unknown values based 
on relationships learned in training data, and they pertain to 
automated tools used for clinical, financial, or administrative 
purposes. ``Health Data, Technology, and Interoperability: 
Certification Program Updates, Algorithm Transparency, and Information 
Sharing.'' 88 FR 23746, 23785 (April 18, 2023).
---------------------------------------------------------------------------

    \333\ 45 CFR 170.102; U.S. Dep't of Health & Hum. Servs., Off. 
of the Nat'l Coordinator for Health Info. Tech., Health Data, 
Technology, and Interoperability: Certification Program Updates, 
Algorithm Transparency, and Information Sharing, Final Rule, 89 FR 
1192 (January 9, 2024). Regarding the term ``intervention,'' ONC 
notes that the term ``intervention'' in ``prediction decision 
support intervention'' was not intended to mean an intervention 
(medicine, medical procedure, or medical treatment) as the term is 
used in the practice of medicine, but rather, an intervention 
occurring within a workstream, including but not limited to alerts, 
order sets, flowsheets, dashboards, patient lists, documentation 
forms, relevant data presentations, protocol or pathway support, 
reference information or guidance, and reminder messages. Their use 
of the term intervention was consistent with how the Program used 
the term in Sec.  170.315(a)(9).
---------------------------------------------------------------------------

    It is important to note that Sec.  92.210 is not duplicative of 
ONC's rule regarding Predictive DSIs because ONC's rule applies to and 
includes requirements for health information technology (IT) 
developers, whereas Sec.  92.210 applies to and includes requirements 
for section 1557 covered entity users of patient care decision support 
tools (including Predictive DSIs). A section 1557 covered entity may, 
of course, develop its own Predictive DSI, in which case that entity 
may be subject to ONC's Predictive DSI requirements as well as section 
1557's nondiscrimination requirements under Sec.  92.210. Refer to 
section V of ONC's January 2024 Final Rule, 89 FR 1242-54, for more 
detailed information regarding Predictive DSIs. OCR worked closely with 
ONC during the development of this final rule and ONC's rule to advance 
a coordinated Departmental response in regulating

[[Page 37644]]

tools used to support health care decision-making.
    Section 92.210's definition for ``patient care decision support 
tool'' also includes non-automated and evidence-based tools that rely 
on rules, assumptions, constraints, or thresholds, as these also have 
the potential to result in discrimination. This includes ``evidence-
based decision support interventions'' identified in ONC regulations at 
45 CFR 170.315(b)(11)(iii). An example of a non-automated patient care 
decision support tool is a Crisis Standards of Care \334\ flowchart for 
triage guidance. Such a flowchart may result in discrimination if, for 
example, it screens out individuals with disabilities, prohibiting them 
from equally accessing a health care service, program, or activity that 
a covered entity offers by assessing an individual's potential response 
to life-saving care without making an individualized assessment of the 
individual's health and without providing modifications for how an 
individual's disability or age could affect the assessment factors used 
in the algorithm or the time needed for the individual to respond to 
treatment. Another example is the race-adjusted estimated glomerular 
filtration rate (eGFR) equation that relies not only on training data, 
but also discriminatory assumptions and thresholds such as by applying 
a race-adjusted coefficient to the eGFR equation to reflect that Black 
people have been associated with higher levels of blood creatinine as 
compared with that of non-Black people, which results in a higher 
significance threshold for Black patients, thereby requiring more 
advanced kidney failure for Black patients than non-Black patients 
before they can receive the same level of care. Other examples of 
patient care decision support tools include, but are not limited to: 
flowcharts; formulas; equations; calculators; algorithms; utilization 
management applications; software as medical devices (SaMDs); software 
in medical devices (SiMDs); screening, risk assessment, and eligibility 
tools; and diagnostic and treatment guidance tools.
---------------------------------------------------------------------------

    \334\ Crisis Standards of Care inform decision-making designed 
to accomplish the best outcome for a group of patients rather than 
focusing on an individual patient.
---------------------------------------------------------------------------

    Comment: Some commenters urged OCR to narrow the definition for 
``clinical algorithm'' and to clarify that the scope of Sec.  92.210 
does not extend beyond flowcharts and clinical algorithms to any forms 
of automated decision systems or AI. These commenters contended that a 
narrow definition is necessary to limit covered entities' liability and 
burden, disruption to covered entities' decision-making, and patients' 
exposure to greater health risks.
    Response: Section 92.210 does not apply to tools used to support 
decision-making unrelated to clinical decision-making affecting patient 
care or that are outside of a covered entity's health programs or 
activities. For example, Sec.  92.210 does not apply to the following 
activities when such activities are unrelated to clinical decision-
making affecting patient care: automated or non-automated tools that 
covered entities use for administrative and billing-related activities; 
automated medical coding; fraud, waste and abuse; patient scheduling; 
facilities management; inventory and materials management; supply chain 
management; financial market investment management; or employment and 
staffing-related activities.
    The purpose of Sec.  92.210 is to prohibit discrimination that 
occurs through covered entities' use of patient care decision support 
tools in their health programs or activities. The rule does not seek to 
disrupt covered entities' clinical decision-making, expose patients to 
greater health risks, or to prevent the use of these tools entirely. We 
encourage covered entities to continue procuring, developing, and using 
patient care decision support tools that will improve patient care and 
access to quality care. Section 92.210 will help covered entities use 
these tools in a nondiscriminatory manner. Under Sec.  92.210, 
evidence-based researchers, whose findings inform many inputs to 
patient care decision support tools, will be incentivized to 
recalibrate data, assumptions, and methods used in earlier studies.
    Comment: Many commenters expressed support for proposed Sec.  
92.210 and discussed the extent of discrimination in health care 
resulting from the use of algorithms. Commenters were particularly 
concerned about the prevalence of ethnic and racial bias in clinical 
algorithms that results in fewer health care services provided to 
Black, Hispanic/Latino, Asian, and American Indian/Alaska Native 
patients. Others discussed Crisis Standards of Care, stating they are 
too often biased against people with disabilities, people of color (who 
disproportionately have at least one disability), and older individuals 
because these tools assess an individual's potential response to life-
saving care without making an individualized assessment of the 
individual's health and without providing modifications for how an 
individual's disability or age could affect the assessment factors used 
in the algorithm or the time needed for the individual to respond to 
treatment.
    Response: OCR appreciates commenters' feedback regarding proposed 
Sec.  92.210. We share commenters' concerns about the potential for 
discrimination caused by the use of algorithms in health care, which 
are receiving considerable attention from the Department and 
Administration,\335\ other executive agencies, Congress, stakeholders, 
professional associations, medical journals, and the media. As OCR 
implements section 1557 and other civil rights laws, it will continue 
to consider additional actions to support covered entities in 
implementation and compliance consistent with Federal law, including 
guidance or provision of technical assistance.
---------------------------------------------------------------------------

    \335\ See, e.g., U.S. Dep't of Health & Hum. Servs., HHS 
Finalizes Rule to Advance Health IT Interoperability and Algorithm 
Transparency (2023), https://www.hhs.gov/about/news/2023/12/13/hhs-finalizes-rule-to-advance-health-it-interoperability-and-algorithm-transparency.html; U.S. Dep't of Health & Hum. Servs., Guiding 
Principles Help Healthcare Community Address Potential Bias 
Resulting from Algorithms (2023), https://www.hhs.gov/about/news/2023/12/15/guiding-principles-help-healthcare-community-address-potential-bias-resulting-from-algorithms.html; U.S. Dep't of Health 
& Hum. Servs., Delivering on the Promise of AI to Improve Health 
Outcomes (2023), https://www.whitehouse.gov/briefing-room/blog/2023/12/14/delivering-on-the-promise-of-ai-to-improve-health-outcomes/; 
U.S. Dep't of Health & Hum. Servs., FACT SHEET: Biden-Harris 
Administration Announces Voluntary Commitments from Leading 
Healthcare Companies to Harness the Potential and Manage the Risks 
Posed by AI (2023), https://www.hhs.gov/about/news/2023/12/14/fact-sheet-biden-harris-administration-announces-voluntary-commitments-leading-healthcare-companies-harness-potential-manage-risks-posed-ai.html.
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    We particularly note that, since publication of proposed Sec.  
92.210, the Administration has issued: (1) a Blueprint for an AI Bill 
of Rights, which includes a principle for protecting the public from 
algorithmic discrimination; \336\ (2) E.O. 14091, Further Advancing 
Racial Equity and Support for Underserved Communities Through the 
Federal Government, which includes a section requiring agencies to 
consider opportunities to ``prevent and remedy discrimination, 
including by protecting the public from algorithmic discrimination;'' 
\337\ and (3) E.O. 14110, Safe, Secure, and Trustworthy Development and 
Use of Artificial Intelligence, which sets forth

[[Page 37645]]

numerous executive actions designed to ensure the equitable, safe, and 
secure use of AI.\338\ E.O. 14110 addresses civil rights violations and 
discrimination related to AI and seeks to protect individuals' civil 
rights by preventing discrimination, including algorithmic 
discrimination, through the use of automated systems and AI.\339\
---------------------------------------------------------------------------

    \336\ The White House, Blueprint for an AI Bill of Rights (Oct. 
4, 2022), https://www.whitehouse.gov/ostp/ai-bill-of-rights/.
    \337\ E.O. 14091, sec. 8(f), 88 FR 10825, 10831 (Feb. 22, 2023), 
https://www.federalregister.gov/documents/2023/02/22/2023-03779/further-advancing-racial-equity-and-support-for-underserved-communities-through-the-federal.
    \338\ E.O. 14110, 88 FR 75191 (Nov. 1, 2023).
    \339\ E.O. 14110, sec. 7, 88 FR 75191, 75211 (Nov. 1, 2023).
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    Executive Order 14110 directs the Department to take actions, 
``possibly including regulatory action,'' to ``ensure the safe, 
responsible deployment and use of AI in the healthcare, public-health, 
and human-services sectors.'' \340\ It also directs the Department to 
``consider appropriate actions to advance the prompt understanding of, 
and compliance with, Federal nondiscrimination laws by health and human 
services providers that receive Federal financial assistance, as well 
as how those laws relate to AI.'' \341\
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    \340\ E.O. 14110, sec. 8(b)(i), 88 FR 75191, 75214 (Nov. 1, 
2023).
    \341\ E.O. 14110, sec. 8(b)(iii), 88 FR 75191, 75214 (Nov. 1, 
2023).
---------------------------------------------------------------------------

    We also acknowledge the recent surge in academic research 
highlighting potential harms caused by use of patient care decision 
support tools that may create or contribute to discrimination 
prohibited by section 1557, as discussed in the Proposed Rule at 87 FR 
47880-82.
    We appreciate the comments addressing the potential bias in Crisis 
Standards of Care, which, as discussed at length in the Proposed Rule, 
87 FR 47881-82, were the focus of OCR's enforcement efforts during the 
COVID-19 Public Health Emergency and resulted in six States revising 
their Crisis Standards of Care to prevent discriminatory prioritization 
of hospital resources.\342\
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    \342\ For more information on OCR's work related to 
discrimination in Crisis Standards of Care, see Civil Rights and 
COVID-19, Non-Discrimination in Crisis Standards of Care, U.S. Dep't 
of Health & Hum. Servs., Off. for Civil Rts., https://www.hhs.gov/civil-rights/for-providers/civil-rights-covid19/.
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    Comment: Some commenters opposed proposed Sec.  92.210, in part, 
because existing laws and regulations already prohibit discrimination 
in algorithmic tools. Other commenters opposed to finalizing Sec.  
92.210 urged OCR to use the feedback we received during the public 
comment period to inform engagement with stakeholders, including the 
Food and Drug Administration (FDA), device manufacturers, algorithm 
developers, clinicians, patients, and others, through which OCR could 
develop a regulatory framework involving risk-based approaches.
    Response: While several Federal departments and agencies are taking 
action to regulate AI and other decision-making tools,\343\ OCR, 
consistent with its underlying authority, is in a unique position to 
provide additional specificity regarding the application of long-
standing nondiscrimination requirements to the use of such tools to 
ensure that discrimination does not result from covered entities' use 
of patient care decision support tools in their health programs or 
activities. The Department has authority to enforce section 1557, which 
prohibits covered entities from discriminating in their health programs 
and activities, including through the use of AI and other tools. 
Section 92.210 provides additional clarity to covered entities 
regarding their obligations. We are finalizing Sec.  92.210 with a 
delayed applicability date of no later than 300 days after the final 
rule's effective date to give covered entities a reasonable period of 
time to come into compliance with Sec.  92.210(b) and (c).
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    \343\ See, e.g., Proposed Rule at 87 FR 47882-84, n.569, 571, 
578; U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Medicare Program; Contract Year 2024 Policy and 
Technical Changes to the Medicare Advantage Program, Medicare 
Prescription Drug Benefit Program, Medicare Cost Plan Program, and 
Programs of All-Inclusive Care for the Elderly, Final Rule, 88 FR 
22120, 22195 (Apr. 12, 2023), https://www.govinfo.gov/content/pkg/FR-2023-04-12/pdf/2023-07115.pdf (``MA organizations must ensure 
that they are making medical necessity determinations based on the 
circumstances of the specific individual, as outlined at Sec.  
422.101(c), as opposed to using an algorithm or software that 
doesn't account for an individual's circumstances.''); U.S. Dep't of 
Health & Hum. Servs., Ctrs. for Medicare & Medicaid Servs., Medicare 
Program: Hospital Outpatient Prospective Payment and Ambulatory 
Surgical Center Payment Systems and Quality Reporting Programs; 
Organ Acquisition; Rural Emergency Hospitals: Payment Policies, 
Conditions of Participation, Provider Enrollment, Physician Self-
Referral; New Service Category for Hospital Outpatient Department 
Prior Authorization Process; Overall Hospital Quality Star Rating; 
COVID-19, Final Rule, 87 FR 71748, 72036 (Nov. 23, 2022), https://www.federalregister.gov/documents/2022/11/23/2022-23918/medicare-program-hospital-outpatient-prospective-payment-and-ambulatory-surgical-center-payment (responding to comment solicitation on how 
to prevent and mitigate bias in algorithms and predictive modeling); 
U.S. Dep't of Health & Hum. Servs., Food & Drug Admin., Artificial 
Intelligence/Machine Learning (AI/ML)-Based Software as a Medical 
Device (SaMD) Action Plan (2021), https://www.fda.gov/medical-devices/software-medical-device-samd/artificial-intelligence-and-machine-learning-software-medical-device; U.S. Dep't of Health & 
Hum. Servs., Off. of the Nat'l Coordinator for Health Info. Tech., 
Health Data, Technology, and Interoperability: Certification Program 
Updates, Algorithm Transparency, and Information Sharing, Final 
Rule, 89 FR 1192 (January 9, 2024); Consumer Fin. Protection Bureau, 
U.S. Dep't of Justice, U.S. Equal Employment Opportunity Comm'n, & 
Fed. Trade Comm'n, Joint Statement on Enforcement Efforts Against 
Discrimination and Bias in Automated Systems (Apr. 2023), https://files.consumerfinance.gov/f/documents/cfpb_joint-statement-enforcement-against-discrimination-bias-automated-systems_2023-04.pdf; Fed. Deposit Ins. Corp., Request for Information and Comment 
on Financial Institutions' Use of Artificial Intelligence, Including 
Machine Learning, 86 FR 16837-38 (May 24, 2021), https://www.govinfo.gov/content/pkg/FR-2021-05-24/pdf/2021-10861.pdf; Nat'l 
Inst. of Standards & Tech., Artificial Intelligence Risk Management 
Framework (AI RMF 1.0), NIST AI 100-1 (2023), https://doi.org/10.6028/NIST.AI.100-1.
---------------------------------------------------------------------------

    We received significant input on this issue from stakeholders 
during the public comment period, and the breadth of stakeholders' 
input and available research has informed the revisions in the final 
version of Sec.  92.210. As OCR implements section 1557 and other civil 
rights laws, it will continue to consider additional actions to support 
covered entities in implementation and compliance consistent with 
Federal law, including guidance or engaging in future rulemaking. As 
AI, clinical algorithms, and predictive analytics are more widely used, 
OCR will continue to engage with the FDA, ONC, and other Federal 
partners to ensure consistency and a coordinated governmental effort to 
regulate such tools in health care. We will also continue to solicit 
stakeholders' input and to assist covered entities with compliance.
    Comment: Some commenters expressed concern that proposed Sec.  
92.210 would not apply to health care-related AI products that are 
autonomous or that augment a covered entity's decision-making in its 
health programs and activities.
    Response: This final rule clarifies that Sec.  92.210 applies to 
all patient care decision support tools used in a covered entity's 
health programs or activities to support clinical decision-making, 
including patient care decision support tools that are autonomous and 
those that assist or augment a covered entity's clinical decision-
making.
    Comment: Some commenters recommended that Sec.  92.210 exclude 
tools designed to improve health equity because these tools serve to 
protect members of historically marginalized communities. Relatedly, 
one commenter asked how proposed Sec.  92.210 would affect algorithms 
that are currently in use and specifically designed to identify certain 
groups of patients susceptible to a particular condition or that may 
benefit from a particular therapy.
    Response: Section 92.210 does not prohibit covered entities from 
using patient care decision support tools that identify, evaluate, and 
address health disparities so long as their use does not constitute 
prohibited discrimination on

[[Page 37646]]

the basis of race, color, national origin, sex, age, or disability.
    Comment: Many commenters requested that OCR revise Sec.  92.210 to 
include transparency requirements for covered entities regarding their 
use of clinical algorithms in their health programs and activities, 
including a requirement that covered entities notify individuals about 
the training data, assumptions, constraints, thresholds, and other 
inputs used to design each clinical algorithm in use. Commenters noted 
that otherwise, individuals would not know whether there has been a 
violation of Sec.  92.210.
    Response: A covered entity may routinely change the patient care 
decision support tools it uses. While there may be benefits to 
providing such information to patients, we decline to revise Sec.  
92.210 to require covered entities to notify patients about the patient 
care decision support tools used in their health programs and 
activities given the possible frequent changes and the costs associated 
with notifying patients.
    We similarly decline to revise Sec.  92.210 to require covered 
entities to notify patients about the training data and other inputs 
used to design and develop the patient care decision support tools used 
by a covered entity because, in addition to the costs discussed above, 
currently, patient care decision support tool developers may not 
ordinarily share this information with covered entities. We note, 
however, that ONC's final rule requires decision support interventions, 
supplied by a developer of certified health IT as part of its Health IT 
Module certified to 45 CFR 170.315(b)(11) criterion, to support making 
this information (source attributes) available to users of the Health 
IT Module. In addition, developers of certified health IT certified to 
45 CFR 170.315(b)(11)(iii)(B) are required to make summary information 
of intervention risk management practices publicly available for 
Predictive DSIs the developer supplies as part of its Health IT Module 
provided through 45 CFR 170.523(f)(1)(xxi). 89 FR 1192 (January 9, 
2024). Covered entities using decision support interventions supplied 
by a developer of certified health IT should have this type of 
information available to them.
    In addition, to the extent that covered entities subject to HIPAA 
document their use of a patient care decision support tool in an 
individual's medical record, individuals may obtain that information 
when they exercise their HIPAA right of access to their protected 
health information contained in their respective designated record 
sets. See 45 CFR 164.524. Other Departmental agencies may also issue 
transparency-related guidance and requirements for AI developers. OCR 
seeks to partner with other agencies and covered entities to address 
best practices and may release guidance in the future.
    While we decline to impose transparency requirements under Sec.  
92.210 for the reasons stated above, we note that it would be a best 
practice for covered entities to disclose information to patients about 
the patient care decision support tools used in their health programs 
and activities.\344\ We further note, however, that such voluntary 
disclosure does not ensure compliance with Sec.  92.210.
---------------------------------------------------------------------------

    \344\ See, e.g., Am. Med. Ass'n, American Medical Association 
Principles for Augmented Intelligence Development, Deployment, and 
Use, pp. 2-4 (2023), https://www.ama-assn.org/system/files/ama-ai-principles.pdf.
---------------------------------------------------------------------------

    Comment: Many commenters recommended that OCR revise Sec.  92.210 
to clarify the steps that a covered entity must take to comply with 
Sec.  92.210 and to ensure nondiscriminatory use of clinical 
algorithms. Commenters explained that when providers use a patient care 
support tool, they often rely on a developer's intended uses for the 
tool. Commenters discussed that covered entities do not design or 
develop many of the clinical algorithms that they use and are therefore 
unlikely to be aware of how the tool operates. They also stated that it 
is infeasible to require a covered entity to audit all algorithms in 
its health programs or activities and that proposed Sec.  92.210 would 
force covered entities to police their own supply chains for clinical 
algorithms, which they state is also impracticable. Commenters 
expressed concern that covered entities may incur liability when they 
are unaware that an algorithmic output may result in discrimination and 
opined that covered entities should not be liable in such cases. 
Another commenter specified that physician liability should be limited 
to when a reasonable physician knows or should have known that the 
algorithm in question utilizes inputs and logic that are likely to 
result in discrimination. Further, commenters asserted that the 
additional steps that covered entities would need to take to comply 
with proposed Sec.  92.210 are very likely to contribute to providers' 
already strained workload and further contribute to burnout.
    Response: We appreciate commenters' concerns and have revised Sec.  
92.210 to provide additional clarity. We have added additional 
clarification on covered entities' obligations under Sec.  92.210. 
Section 92.210 sets forth the general prohibition on discrimination on 
the basis of race, color, national origin, sex, age, or disability by a 
covered entity in its health programs or activities through the use of 
patient care decision support tools. Section 92.210(b) requires a 
covered entity to make reasonable efforts to identify patient care 
decision support tools used in its health programs and activities that 
employ input variables or factors that measure race, color, national 
origin, sex, age, or disability. Section 92.210(c) requires that for 
each patient care decision support tool identified in paragraph (b), a 
covered entity must make reasonable efforts to mitigate the risk of 
discrimination resulting from the tool's use in its health programs or 
activities.
    We appreciate comments regarding how a covered entity may learn 
that a patient care decision support tool used in its health programs 
or activities creates a risk of discrimination on a protected basis. In 
the Proposed Rule, we noted that use of clinical algorithms may result 
in discriminatory outcomes when variables are used as a proxy for a 
protected basis, and that discrimination may result from correlations 
between a variable and a protected basis. 87 FR 47881. As a threshold 
matter, we note that section 1557 prohibits proxy discrimination as a 
general civil rights principle that applies to the entire final 
rule.\345\ However, given the many possible indirect measures of race, 
color, national origin, sex, age, and disability, covered entities are 
not required to identify all patient care decision support tools with 
input variables or factors that indirectly measure these protected 
bases. However, covered entities should exercise caution when using 
patient care decision support tools that are known to use indirect 
measures for race, color, national origin, sex, age, or disability, 
which could result in prohibited discrimination.
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    \345\ See discussion of proxy discrimination at Sec.  92.207.
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    We understand that covered entities in some circumstances may be 
largely unaware of the datasets developers use to train the patient 
care decision support tools that covered entities use. Section 92.210 
does not require covered entities to obtain datasets or other attribute 
information from developers when purchasing or using patient care 
decision support tools. However, if a covered entity does not know 
whether a developer's patient care decision support tool uses variables 
or factors that measure race, color, national origin,

[[Page 37647]]

sex, age, or disability but has reason to believe such variables or 
factors are being used, or the covered entity otherwise knows or should 
know that the tool could result in discrimination, the covered entity 
should consult publicly available sources or request this information 
from the developer.
    Further, ONC's recently published final rule discussed above 
revises existing certification criteria for developers of certified 
health IT by requiring developers with Health IT Modules certified to 
Sec.  170.315(b)(11) to disclose information about a decision support 
intervention's source attributes relevant to health equity with the 
decision support intervention users. 89 FR 1192. This disclosure 
requirement will work in tandem with Sec.  92.210 by enabling a covered 
entity that uses Health IT Modules certified to Sec.  170.315(b)(11) to 
learn from a developer whether a specific decision support intervention 
relies on attributes that measure race, color, national origin, sex, 
age, or disability.
    We are aware that covered entities use patient care decision 
support tools based on their respective needs and in accordance with 
developers' intended uses. But covered entities must exercise due 
diligence when acquiring and using such tools to ensure compliance with 
Sec.  92.210.
    Covered entities may learn that use of patient care decision 
support tools risk resulting in discrimination when OCR included that 
information in the Proposed Rule. In the Proposed Rule, in addition to 
the use of the race-adjusted eGFR equation discussed above, we 
identified uses of other categories of tools that may result in 
discrimination based on race, including tools used in ``cardiology (to 
assess the risk of heart failure), cardiac surgery (to assess the risk 
of complications and death), obstetrics (to determine risks associated 
with vaginal birth after cesarean), urology (to assess the risk of 
kidney stones and urinary tract infections), oncology (to predict 
rectal cancer survival and breast cancer risk), endocrinology (to 
assess osteoporosis and fracture risks), and pulmonology (to measure 
lung function).'' 87 FR 47881. The Proposed Rule also identified that 
use of Crisis Standards of Care to allocate health care resources may 
also discriminate on the basis of disability and/or age. 87 FR 47880-
82. OCR aims to continue providing additional guidance to the public 
and covered entities as such information on potential discrimination in 
the use of such tools becomes available.
    The Department itself regularly publishes information and 
advisories to the public. For example, the Agency for Healthcare 
Research and Quality (AHRQ) recently issued a report on the ``Impact of 
Healthcare Algorithms on Racial and Ethnic Disparities in Health and 
Healthcare.'' \346\ Additionally, addressing published medical 
journals' research studies and the subsequent media attention about 
racial bias resulting from the use of pulse oximeters, the FDA 
published a safety communication to announce that the FDA was 
reassessing the content of its pulse oximetry guidance document and 
would share additional updates with the public.\347\
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    \346\ Kelley Tipton et al., U.S. Dep't of Health & Hum. Servs., 
Agency for Healthcare Rsch. & Quality, Impact of Healthcare 
Algorithms on Racial and Ethnic Disparities in Health and 
Healthcare, Comparative Effectiveness Review No. 268, AHRQ 
Publication No. 24-EHC004 (2023), https://effectivehealthcare.ahrq.gov/sites/default/files/related_files/cer-268-racial-disparities-health-healthcare.pdf.
    \347\ U.S. Dep't of Health & Hum. Servs., Food & Drug Admin., 
Pulse Oximeter Accuracy and Limitations: FDA Safety Communication, 
https://public4.pagefreezer.com/content/FDA/20-02-2024T15:13/https://www.fda.gov/medical-devices/safety-communications/pulse-oximeter-accuracy-and-limitations-fda-safety-communication.
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    Published articles of research studies in peer-reviewed medical 
journals are also a reliable source of information about evidence-based 
adverse outcomes based on patient care decision support tools that may 
result in discrimination. Such articles are increasing in prevalence 
given the growing use of AI and other patient care decision support 
tools in health care decision-making.\348\ For example, peer-reviewed 
medical journals have recently published several articles related to 
racial discrepancies resulting from the use of pulse oximeters.\349\ 
One such study found that pulse oximeters more commonly overestimated 
arterial oxygen saturation levels in patients from minority racial and 
ethnic groups and led to delayed recognition of need for COVID-19 
therapy among Black patients compared with white patients.\350\
---------------------------------------------------------------------------

    \348\ See, e.g., Armando D. Bedoya et al., A Framework for the 
Oversight and Local Deployment of Safe and High-Quality Prediction 
Models, 29 J. of Am. Med. Informatics Ass'n. 9, 1631-1636 (2022), 
https://doi.org/10.1093/jamia/ocac078 (describing a governance 
framework that combines current regulatory best practices and 
lifecycle management of predictive models being used for clinical 
care and maintaining a governance portfolio where models are 
actively added); Shyam Visweswaran et al., Clinical Algorithms with 
Race: An Online Database, medRxiv [Preprint], doi: 10.1101/
2023.07.04.23292231 (2023), https://pubmed.ncbi.nlm.nih.gov/
37461462/#:~:text=These%20clinical%20algorithms%20based%20on,the%20in
appropriate%20use%20of%20race (conducting a comprehensive search of 
online resources, the scientific literature, and the FDA Drug Label 
Information to identify clinical algorithms that incorporate race or 
ethnicity as an input variable or predictor in determining 
diagnoses, prognoses, treatment plans, or risk assessments; finding 
39 race-based risk calculators, 6 laboratory test results with race-
based reference ranges, 1 race-based therapy recommendation, and 15 
medications with race-based recommendations; and creating a current 
and open-access database to track race-based clinical algorithms).
    \349\ See, e.g., Ashraf Fawzy et al., Racial and Ethnic 
Discrepancy in Pulse Oximetry and Delayed Identification of 
Treatment Eligibility Among Patients with COVID-19, 182 JAMA 
Internal Med. 730 (2022), https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2792653; Valeria S.Valbuena et al., 
Racial and Ethnic Bias in Pulse Oximetry and Clinical Outcomes, 182 
JAMA Internal Med. 699 (2022), https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2792654; Michael W. Sjoding et al., 
Racial Bias in Pulse Oximetry Measurement, 383 New Eng. J. Med. 2477 
(2020) https://www.nejm.org/doi/full/10.1056/nejmc2029240.
    \350\ Ashraf Fawzy et al., Racial and Ethnic Discrepancy in 
Pulse Oximetry and Delayed Identification of Treatment Eligibility 
Among Patients with COVID-19, 182 JAMA Internal Med. 730 (2022), 
https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2792653.
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    Covered entities also may gain knowledge that use of a patient care 
decision support tool creates a risk of discrimination based on a 
prohibited basis through media outlets that may report on reliable 
studies.\351\
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    \351\ Following medical journals' publication of research 
articles related to racial bias through the use of pulse oximeters, 
several media outlets amplified those findings further to the 
public. See, e.g., Anil Onza et al., COVID-19 Made Pulse Oximeters 
Ubiquitous. Engineers are Fixing Their Racial Bias, (Feb. 13, 2023), 
https://www.npr.org/2023/02/10/1156166554/covid-19-pulse-oximeters-racial-bias; Pulse Oximeters Should Not Be Used to Diagnose COVID-
19, U.S. FDA Says, Reuters (Feb. 19, 2021), https://www.reuters.com/article/us-health-coronavirus-pulse-oximeter/pulse-oximeters-should-not-be-used-to-diagnose-covid-19-u-s-fda-says-idUSKBN2AJ2G7.
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    Health care professional and hospital associations are also often 
dependable sources of information that notify health care providers 
about developments in the practice of various specialties and in the 
administration of medical care, which can include potential 
discrimination that may result from the use of certain patient care 
decision support tools.\352\ Health insurance-related associations also 
provide information to their members and the public.\353\ Relevant 
information is also

[[Page 37648]]

provided through various nonprofit organizations in the field of AI.
---------------------------------------------------------------------------

    \352\ See, e.g., Augmented Intelligence in Medicine, Am. Med. 
Ass'n, https://www.ama-assn.org/practice-management/digital/augmented-intelligence-medicine (updated Mar. 1, 2024); Clinical 
Applications of Artificial Intelligence (webinar), Am. Coll. of 
Physicians, https://www.acponline.org/meetings-courses/webinars/clinical-applications-of-artificial-intelligence (June 8, 2023). See 
generally, Medical & Professional Associations, Meditech, https://www.meditec.com/resourcestools/professional-associations-list.
    \353\ See, e.g., Artificial Intelligence, Nat'l Ass'n of Ins. 
Comm'rs, https://content.naic.org/cipr-topics/artificial-intelligence; Creating Better Health Outcomes with Digital Tools and 
Artificial Intelligence (webinar), Am.'s Health Ins. Plans, https://www.ahip.org/webinars/creating-better-health-outcomes-with-digital-tools-and-artificial-intelligence (Dec. 8, 2023).
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    ONC's rule also provides an opportunity for covered entities to 
learn about the data used in decision support interventions. Developers 
of decision support interventions that develop certified health IT as 
part of its Health IT Module are required to support making specific 
information disclosures under ONC's rule regarding discriminatory bias 
in their tools, including disclosure of source attributes, and risk 
management and governance practices.\354\
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    \354\ U.S. Dep't of Health & Hum. Servs., Off. of the Nat'l 
Coordinator for Health Info. Tech., Health Data, Technology, and 
Interoperability: Certification Program Updates, Algorithm 
Transparency, and Information Sharing, Final Rule, 89 FR 1192 
(January 9, 2024).
---------------------------------------------------------------------------

    OCR will assess each allegation that a covered entity is violating 
Sec.  92.210 on a case-by-case basis. For example, when OCR 
investigated complaints related to State Crisis Standards of Care 
guidelines during the COVID-19 pandemic, the investigations involved a 
fact-specific analysis of each of the guidelines in question. They also 
included extensive technical assistance with States to revise their 
Crisis Standards of Care guidelines to remove the alleged 
discriminatory.\355\
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    \355\ See, e.g., U.S. Dep't of Health & Hum. Servs., Off. for 
Civil Rts., Civil Rights and COVID-19, Non-Discrimination in Crisis 
Standards of Care, https://www.hhs.gov/civil-rights/for-providers/civil-rights-covid19/; Press release, U.S. Dep't of Health 
& Hum. Servs., Off. for Civil Rts., OCR Resolves Complaint with Utah 
After It Revised Crisis Standards of Care to Protect Against Age and 
Disability Discrimination (Aug. 20, 2020), https://public3.pagefreezer.com/content/HHS.gov/31-12-2020T08:51/https://www.hhs.gov/about/news/2020/08/20/ocr-resolves-complaint-with-utah-after-revised-crisis-standards-of-care-to-protect-against-age-disability-discrimination.html.
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    In our analysis of whether a covered entity is in compliance with 
Sec.  92.210(b)'s ``reasonable efforts to identify'' requirement, OCR 
may consider, among other factors: (1) the covered entity's size and 
resources (e.g., a large hospital with an IT department and a health 
equity officer would likely be expected to make greater efforts to 
identify tools than a smaller provider without such resources); (2) 
whether the covered entity used the tool in the manner or under the 
conditions intended by the developer and approved by regulators, if 
applicable, or whether the covered entity has adapted or customized the 
tool; (3) whether the covered entity received product information from 
the developer of the tool regarding the potential for discrimination or 
identified that the tool's input variables include race, color, 
national origin, sex, age, or disability; and (4) whether the covered 
entity has a methodology or process in place for evaluating the patient 
care decision support tools it adopts or uses, which may include 
seeking information from the developer, reviewing relevant medical 
journals and literature, obtaining information from membership in 
relevant medical associations, or analyzing comments or complaints 
received about patient care decision support tools.
    In summary, OCR recognizes the challenges in identifying the 
discriminatory potential of every use of each patient care decision 
support tool, and therefore Sec.  92.210(b) requires covered entities 
to make reasonable efforts to identify tools that employ input 
variables based on a protected basis.
    Comment: Many commenters referred to potential devastating 
consequences from the use of specific clinical algorithms \356\ and 
recommended that Sec.  92.210 be revised to include a requirement for 
covered entities to mitigate the risk of discrimination that results 
from the use of clinical algorithms. Some commenters suggested that OCR 
require specific mitigation efforts, such as requiring covered entities 
to: develop and implement policies specific to covered entities' use of 
clinical algorithms; require staff training; use clinical algorithms in 
accordance with FDA clearance and developer's intended uses; use peer-
reviewed research to inform adjustments to clinical algorithms; notify 
patients of suspect clinical algorithms; request an assessment of 
discriminatory inputs from developers; neutralize any discriminatory 
inputs by using the predominant cohort in the tool's training data; and 
submit annual reports to OCR regarding their use of clinical algorithms 
and mitigation efforts.
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    \356\ Examples included race-adjusted correction factors used in 
spirometry, nephrology, and cardiology; State Medicaid eligibility 
systems that reduce benefits impacting historically marginalized 
individuals disproportionately to the overall population; health 
care utilization algorithms that use prior health care spending data 
to predict future health care needs that results in under-
representing Black patients as compared to white patients; and other 
examples discussed throughout this preamble.
---------------------------------------------------------------------------

    Response: OCR agrees with commenters' concerns about the potential 
for harm resulting from discriminatory algorithms and the need to 
mitigate the risks of discrimination when possible. However, we 
acknowledge that it is not always possible to completely eliminate the 
risk of discriminatory bias in patient care decision support 
tools,\357\ and these tools also serve important health care functions. 
Section 92.210(c) requires covered entities to make reasonable efforts 
to mitigate the risk of discrimination resulting from the covered 
entity's use of a patient care decision support tool identified in 
Sec.  92.210(b). This standard allows a covered entity to adopt more 
robust safeguards to prevent discrimination, should it choose to do so.
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    \357\ See, e.g., Nat'l Inst. of Standards & Tech., Artificial 
Intelligence Risk Management Framework (AI RMF 1.0), NIST AI 100-1, 
(2023), https://doi.org/10.6028/NIST.AI.100-1.
---------------------------------------------------------------------------

    For example, in order to comply with Sec.  92.210(c)'s mitigation 
requirement, a covered entity that uses the race-adjusted eGFR equation 
could discontinue using that equation and instead use the revised eGFR 
equation that does not adjust for race.\358\ The covered entity may 
also implement measures to ensure that staff members follow proper 
protocols when using the race-adjusted eGFR equation.\359\ OCR will 
evaluate mitigation measures covered entities take on a case-by-case 
basis to determine compliance with Sec.  92.210(c).
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    \358\ See, e.g., Cynthia Delgado et al., Special Report: A 
Unifying Approach for GFR Estimation: Recommendations of the NKF-ASN 
Task Force on Reassessing the Inclusion of Race in Diagnosing Kidney 
Disease, 79 a.m. J. of Kidney Diseases, 268-288 (Sept. 23, 2021), 
https://www.ajkd.org/article/S0272-63862100828-3/fulltext.
    \359\ See, e.g., Press Release, U.S. Dep't of Health & Hum. 
Servs., Health Servs. & Rsch. Admin., Organ Procurement & 
Transplantation Network, OPTN Board Approves Waiting Time Adjustment 
for Kidney Transplant Candidates Affected by Race-Based Calculation 
(Jan. 5, 2023), https://optn.transplant.hrsa.gov/news/optn-board-approves-waiting-time-adjustment-for-kidney-transplant-candidates-affected-by-race-based-calculation/.
---------------------------------------------------------------------------

    A covered entity's obligation to mitigate risk of discrimination 
under Sec.  92.210(c) is consistent with the National Institutes of 
Standards and Technology's (NIST) Artificial Intelligence Risk 
Management Framework, which explains that AI bias mitigation helps 
minimize potential negative impacts of AI systems while providing 
opportunities to maximize positive impacts, without articulating 
express mitigation measures.\360\ The same is true for patient care 
decision support tools that a covered entity uses

[[Page 37649]]

in its health programs and activities for clinical decision-making.
---------------------------------------------------------------------------

    \360\ Nat'l Inst. of Standards & Tech., Artificial Intelligence 
Risk Management Framework (AI RMF 1.0), NIST AI 100-1, p. 4 (2023), 
https://doi.org/10.6028/NIST.AI.100-1, (The NIST AI Framework 
provides: ``Where tradeoffs among the trustworthy characteristics 
arise, measurement provides a traceable basis to inform management 
decisions. Options may include recalibration, impact mitigation, or 
removal of the system from design, development, production, or use, 
as well as a range of compensating, detective, deterrent, directive, 
and recovery controls.'').
---------------------------------------------------------------------------

    While we appreciate the breadth of mitigation techniques suggested 
by commenters--and agree that many of those efforts would be best 
practices to prevent algorithmic discrimination--we decline to require 
covered entities to take any specific mitigation efforts under Sec.  
92.210(c). We have determined that a reasonable efforts mitigation 
requirement strikes the right balance between the need for covered 
entities to mitigate the risk of discrimination resulting from their 
use of patient care decision support tools and the burden placed on 
covered entities. In the Proposed Rule, 87 FR 47883, we noted that 
covered entities may choose to mitigate discrimination by establishing 
written policies and procedures governing how clinical algorithms will 
be used in decision-making, including adopting governance measures; 
monitoring any potential impacts and developing ways to address 
complaints; and training staff on the proper use of such systems in 
decision-making. We encourage covered entities to take these and other 
additional mitigating efforts to comply with Sec.  92.210.\361\ We 
further note that this rule does not excuse a covered entity from 
complying with any other applicable Federal or State law that may 
apply, including but not limited to requirements for FDA approval where 
appropriate, such as the Food Drug and Cosmetic Act \362\ and the 
Medical Device Amendments.\363\
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    \361\ See, e.g., Marshall H. Chin et al., Guiding Principles to 
Address the Impact of Algorithm Bias on Racial and Ethnic 
Disparities in Health and Health Care, 6 JAMA Network Open 12 
(2023), https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2812958; Coalition for Health AI, Blueprint for 
Trustworthy AI Implementation Guidance and Assurance for Healthcare 
(2023), https://www.coalitionforhealthai.org/papers/blueprint-for-trustworthy-ai_V1.0.pdf.
    \362\ 21 U.S.C. 301 et seq.
    \363\ Pub. L. 94-925.
---------------------------------------------------------------------------

    In addition, once a covered entity identifies a particular use of 
patient care decision support tool under Sec.  92.210(b), a covered 
entity's mitigation efforts under Sec.  92.210(c) may vary based on the 
input variable or factor, as well as the purpose of the tool in 
question. OCR acknowledges that some input variables may generate 
greater scrutiny, such as race, which is highly suspect,\364\ as 
compared to other variables, such as age, which is more likely to have 
a clinically and evidence-based purpose. Some bases protected by 
section 1557, such as age, are likely prevalent in patient care 
decision support tools and may not require extensive mitigation efforts 
under Sec.  92.210(c) if use of the variable in the tool does not 
result in discrimination. For instance, where a tool employs an input 
variable for age, the covered entity's mitigation efforts under Sec.  
92.210(c) regarding that tool may include justifying the tool's use of 
age as an input variable by showing that age is clinically indicated as 
a measure in the particular tool and/or aligns with evidence-based 
clinical best practices that do not result in discrimination. We 
further note that the Age Act itself allows age distinctions under 
certain circumstances, including when related to age distinctions that 
reasonably take into account age as a factor necessary to the normal 
operation or the achievement of any statutory objective of a program or 
activity. 42 U.S.C. 6103(b)(1); 45 CFR 91.13 (adopting statutorily 
permissive age distinctions found at 42 U.S.C. 6103(b)(1)).
---------------------------------------------------------------------------

    \364\ See, e.g., Michelle Tong & Samantha Artiga, Use of Race in 
Clinical Diagnosis and Decision Making: Overview and Implications, 
KFF (2021), https://www.kff.org/report-section/use-of-race-in-clinical-diagnosis-and-decision-making-overview-and-implications-issue-brief/.
---------------------------------------------------------------------------

    Comment: Some commenters indicated that clinicians trust the FDA's 
process for reviewing and approving clinical use of patient care 
decision support tools as well as published data illustrating a tool's 
efficacy in their use of these tools.
    Response: The FDA regulates the sale of medical devices (including 
diagnostic tests) and monitors the ongoing safety and effectiveness of 
regulated marketed devices.\365\ The FDA has released draft guidance on 
Predetermined Change Control Protocol (PCCP AI/ML) \366\ and will be 
publishing draft guidance for Artificial Intelligence/Machine Learning 
(AI/ML)-enabled Device Software Functions: Lifecycle Management 
Considerations and Premarket Submission Recommendations. In addition, 
FDA is actively working through public-private partnerships to set 
uniform guidelines on addressing bias in AI across its lifecycle.
---------------------------------------------------------------------------

    \365\ See U.S. Dep't of Health & Hum. Servs., Food & Drug 
Admin., FDA's Role in Regulating Medical Devices, https://
www.fda.gov/medical-devices/home-use-devices/fdas-role-regulating-
medical-
devices#:~:text=FDA%20regulates%20the%20sale%20of,of%20all%20regulate
d%20medical%20products.
    \366\ 88 FR 19648 (Apr. 3, 2023); see also U.S. Dep't of Health 
& Hum. Servs., Food & Drug Admin., CDRH Issues Draft Guidance on 
Predetermined Change Control Plans for Artificial Intelligence/
Machine Learning-Enabled Medical Devices, https://www.fda.gov/medical-devices/medical-devices-news-and-events/cdrh-issues-draft-guidance-predetermined-change-control-plans-artificial-intelligencemachine.
---------------------------------------------------------------------------

    Section 92.210 is concerned with ensuring that covered entities' 
use of a patient care decision support tool does not result in 
prohibited discrimination, which includes medical devices as 
``automated or non-automated tool[s] . . . used by a covered entity to 
support clinical decision-making.'' While FDA's premarket review 
processes strive to minimize discriminatory biases in patient care 
decision support tools before they are authorized to market, real world 
post-market deployment of FDA-approved devices can introduce 
discriminatory bias. Therefore, it is important to identify different 
points of bias and provide an action plan for remediation.\367\
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    \367\ See U.S. Dep't of Health & Hum. Servs., Food & Drug 
Admin., About FDA: Patient Q&A, https://www.fda.gov/media/151975/
download#:~:text=The%20FDA%20does%20not%20regulate,by%20health%20insu
rance%20or%20Medicare; Alessandro Hammond et al., An Extension to 
the FDA Approval Process Is Needed to Achieve AI Equity, 5 Nature 
Machine Intelligence 96 (2023), https://www.nature.com/articles/s42256-023-00614-8.
---------------------------------------------------------------------------

    Comment: Many commenters suggested that covered entities should 
share liability with algorithm creators for the consequences related to 
covered entities' use of these tools because clinicians may lack 
sufficient information to detect that an algorithm can result in 
discrimination. Another commenter suggested that Sec.  92.210 should 
impose strict liability on manufacturers of algorithms, not the end 
users. Yet another commenter suggested that OCR create a safe harbor 
for covered entities that use clinical algorithms consistent with and 
within the scope of their intended purpose.
    Response: Each covered entity is independently required to comply 
with all provisions in section 1557, including Sec.  92.210. A covered 
provider's liability under section 1557 is not contingent on or related 
to a developer's potential liability under this rule or this provision. 
As discussed above, Sec.  92.210(b) requires a covered entity to 
identify use of patient care decision support tools in its health 
programs and activities that employ input variables or factors that 
measure race, color, national origin, sex, age, or disability, and 
Sec.  92.210(c) requires covered entities to make reasonable efforts to 
mitigate the risk of discrimination that results from the covered 
entity's use of a tool identified in Sec.  92.210(b) in clinical 
decision-making.
    If a developer is subject to section 1557, Sec.  92.210 applies to 
it in the same manner it applies to all covered entities. Under Sec.  
92.210, covered entities must take requisite actions to ensure their 
use of a patient care decision support tool does not result in 
discrimination. We decline to impose strict liability on covered 
entities in their use of these tools, including covered developers.

[[Page 37650]]

    Comment: Some commenters opined that proposed Sec.  92.210 lacked 
sufficient specificity and that our reference in the Proposed Rule to 
covered entities' overreliance on clinical algorithms was confusing 
because there is no definition or criteria about what it means to 
``rely'' on a clinical algorithm.
    Response: We appreciate commenters' concerns. We note that Sec.  
92.210 relates to covered entities' use of patient care decision 
support tools rather than their reliance on them. In the Proposed Rule, 
we cautioned that a covered entity's overreliance on clinical 
algorithms in its decision-making can result in discrimination, and 
that covered entities should refrain from over-relying on patient care 
decision support tools by using them beyond their reasonably expected 
scope as a replacement or substitute for providers' clinical judgment. 
87 FR 47880-82.
    Comment: Some commenters characterized Sec.  92.210 as a novel 
provision and argued that, in consequence, OCR investigative staff need 
to conduct fact-specific analyses of allegations of discrimination. 
Other commenters supported OCR's proposed approach to conduct a case-
by-case factual inquiry into compliance with Sec.  92.210. Many 
commenters pointed out that proactive oversight by OCR is also needed 
due to the non-transparent, systemic nature of this form of 
discrimination, which may limit complaints.
    Response: OCR will investigate each complaint under Sec.  92.210 on 
a case-by-case basis. OCR will review all applicable evidence to 
determine whether the covered entity took reasonable steps to identify 
whether the patient care decision support tool it is using is a tool 
that employs input variables that measure race, color, national origin, 
sex, age, or disability under Sec.  92.210(b). When an investigation 
reveals that a covered entity has appropriately identified its use of a 
patient care decision support tool under Sec.  92.210(b), OCR will 
determine whether the covered entity took reasonable efforts to 
mitigate the risk of discrimination resulting from the use of the 
patient care decision support tool at issue in accordance with Sec.  
92.210(c), as described above. As we have affirmed elsewhere with 
respect to other provisions of this final rule, OCR will employ all 
available means to investigate alleged violations of Sec.  92.210, 
including through complaint investigations and compliance reviews based 
upon potential complaints in order to provide proactive oversight over 
the use of these tools.
    Comment: A professional association commenter recommended that 
OCR's enforcement actions should consider whether covered entities have 
set up incentives to pressure health care professionals to follow the 
recommendations of clinical algorithms even if they conflict with the 
professional's clinical judgment.
    Response: We appreciate this comment, and OCR will take such 
situations into account on a case-by-case basis when determining 
whether a covered entity violates this provision as OCR evaluates the 
facts in complaints brought under Sec.  92.210.
    Comment: Commenters recommended that OCR work with covered entities 
to achieve compliance by providing covered entities, specifically 
physician practices, with technical assistance and guidance, to help 
them integrate both clinical algorithms and improvements for these 
algorithms into existing clinical workflows to increase efficiency and 
minimize administrative burden.
    Response: OCR seeks to provide covered entities with technical 
assistance regarding compliance with all civil rights requirements, 
including compliance with Sec.  92.210. OCR is committed to partnering 
with covered entities to eliminate discrimination resulting from the 
use of patient care decision support tools in covered entities' health 
programs and activities.
    Comment: Some commenters were concerned that complying with Sec.  
92.210 would be difficult for smaller covered entities with fewer 
resources.
    Response: Section 92.210 applies to all covered entities regardless 
of size, including smaller entities. All covered entities must make 
reasonable efforts to mitigate the risk of discrimination resulting 
from their use of a patient care decision support tool identified in 
Sec.  92.210(b), but the size and resources of the covered entity will 
factor into the reasonableness of their mitigation efforts and their 
compliance with Sec.  92.210.
    Comment: Some commenters encouraged OCR to require covered entities 
to comply with Sec.  92.210 as quickly as possible, while one commenter 
suggested that covered entities should be required to evaluate their 
algorithms and mitigate bias within 12 months.
    Response: We acknowledge that covered entities may need additional 
time to comply with the new requirements in Sec.  92.210(b) and (c). 
Therefore, OCR is revising Sec.  92.1 to reflect a delayed 
applicability date that specifies covered entities must comply with 
Sec.  92.210(b) and (c) within 300 days following the effective date of 
the rule.
Request for Additional Comment
    OCR seeks comment on whether we should engage in additional 
rulemaking to expand the scope of Sec.  92.210, and if so, in what 
ways. Specifically, OCR seeks comment on other decision support tools 
that are being used in covered entities' health programs and activities 
that do not directly impact patient care and clinical decision-making, 
but may nevertheless result in unlawful discrimination in violation of 
section 1557, and whether Sec.  92.210 should apply to such decision 
support tools. For example, we are aware of decision support tools that 
are used by health insurance issuers to determine amounts owed to them 
or by providers for services rendered. Other examples include tools 
used for automated coding for billing,\368\ and fraud, waste, and 
abuse.\369\ Additionally, covered entities may use decision support 
tools for administrative and operational activities, such as patient 
scheduling, and we are aware that there is research suggesting that 
these tools can result in rushed and inadequate care for lower 
socioeconomic patients.\370\ Decision support tools may also be used to 
allocate resources, such as allocating spending geographically on 
diagnostic imaging that favors regions with historically more 
expensive, high-tech equipment and a lower presence of historically 
marginalized and underserved persons.\371\ OCR seeks comment on these 
uses and others that may result in unlawful discrimination in violation 
of section 1557, and whether Sec.  92.210 should be expanded to cover 
these tools as well.
---------------------------------------------------------------------------

    \368\ See, e.g., Jessica Miller, How Is AI Quickly Taking 
Medical Coding to the Next Level?, Medicodio (June 6, 2023) https://
medicodio.com/how-is-ai-quickly-taking-medical-coding-to-the-next-
level/
#:~:text=AI%20has%20transformed%20medical%20coding,codes%2C%20and%20a
ssign%20them%20automatically.
    \369\ See, e.g., Bill Siwicki, At UMich, AI-Based Fraud, Waste, 
and Abuse System Aims to Cut Costs and Protect Patients, 
HealthcareITNews (Aug. 1, 2023), https://www.healthcareitnews.com/news/umich-ai-based-fraud-waste-and-abuse-system-aims-cut-costs-and-protect-patients.
    \370\ See, e.g., Howard Fine et al., Health Care Embraces AI, 
Los Angeles Business Journal (June 12, 2023), https://labusinessjournal.com/special-reports/health-care-embraces-ai/.
    \371\ See, e.g., Brent Nelson et al., Computerized Decision 
Support for Concurrent Utilization Review Using the HELP System, 1 
J. Am. Med. Informatics Ass'n. 339 (1994), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC116216/pdf/0010339.pdf.
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Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing Sec.  92.210 with modifications. 
First, we are adding a Sec.  92.210(a), which reads

[[Page 37651]]

the same as proposed Sec.  92.210 except that we added ``General 
prohibition'' to the beginning of the provision and replaced the term 
``clinical algorithm'' with the term ``patient care decision support 
tool.'' Second, we added Sec.  92.210(b), which states, ``A covered 
entity has an ongoing duty to make reasonable efforts to identify uses 
of patient care decision support tools in its health programs or 
activities that employ input variables or factors that measure race, 
color, national origin, sex, age, or disability.'' Third, we have added 
Sec.  92.210(c), which states, ``For each patient care decision support 
tool identified in paragraph (b) of this section, a covered entity must 
make reasonable efforts to mitigate the risk of discrimination 
resulting from the tool's use in the covered entity's health programs 
or activities.''
Nondiscrimination in the Delivery of Health Programs and Activities 
Through Telehealth Services (Sec.  92.211)
    In Sec.  92.211, we proposed that a covered entity must not, in 
delivery of its health programs and activities through telehealth 
services, discriminate on the basis of race, color, national origin, 
sex, age, or disability.
    OCR sought comment on this approach and whether covered entities 
and others would benefit from a specific provision addressing 
accessibility in telehealth services for individuals with disabilities 
and individuals with LEP. We invited comment on what such a provision 
should include, and why the provisions at proposed Sec. Sec.  92.201 
(Meaningful access for individuals with LEP), 92.202 Effective 
communication for individuals with disabilities), and 92.204 
(Accessibility of ICT for individuals with disabilities), would be 
insufficient. Further, we requested comment on challenges with 
accessibility specific to telehealth and recommendations for telehealth 
accessibility standards that would supplement the effective 
communication and ICT provisions of this part. We encouraged commenters 
to consider the range of technology available for accessing telehealth, 
including user-friendly design, as well as security and privacy 
requirements (for example, when using public Wi-Fi access).
    The comments and our responses regarding Sec.  92.211 are set forth 
below.
    Comment: Most commenters on this issue were supportive, stating 
that a specific provision requiring nondiscrimination in delivery of 
health programs and activities through telehealth services is important 
for addressing health equity for underserved groups and areas, social 
determinants of health, and improving access to a wide range of health 
care. Some commenters added that the expansion of telehealth has been 
particularly important for access to care for those who are 
immunocompromised or otherwise at risk for COVID-19 and potential 
future pandemics, those who live in rural communities, and those in 
need of gender-affirming care. Many commenters called for increased 
investment and training to promote technological literacy as a vital 
complement to this effort.
    Response: We agree that a standalone provision requiring 
nondiscrimination in delivery of health programs and activities through 
telehealth services is warranted and we appreciate the thoughtful 
comments. We welcome the opportunity to promote health literacy and 
provide technical assistance within our scope of authority.
    Comment: A few commenters indicated that covered entities will 
require additional time, technical assistance, and/or safe harbors to 
come into compliance with this provision, particularly if specific 
language access and accessibility requirements regarding telehealth 
platforms are incorporated. Furthermore, one commenter contended that 
regulation is premature since telehealth technology and platforms are 
too new.
    Response: While we appreciate the concerns expressed by covered 
entities, we respectfully disagree with the proposition that it is 
premature to regulate nondiscrimination in health programs and 
activities delivered via telehealth. As stated in the Proposed Rule and 
the Department's joint guidance with DOJ on nondiscrimination in 
telehealth (Telehealth Guidance),\372\ covered entities that use 
telehealth are already prohibited from doing so in a discriminatory 
manner. The Telehealth Guidance explains covered entities' 
responsibilities to ensure effective communication and the provision of 
auxiliary aids and services (section 504 and Sec.  92.202) and the 
provision of language assistance services for individuals with LEP 
(title VI and Sec.  92.201). Telehealth platforms, in particular, are 
also covered by the ICT provision (Sec.  92.204). Given the dramatic 
expansion in the use of telehealth and continuing barriers in access to 
care experienced by individuals due to inaccessibility of telehealth 
services, we believe it is necessary and appropriate to regulate this 
medium of health care provision. OCR will provide further technical 
assistance and clarifying guidance as appropriate to help covered 
entities further understand their responsibilities.
---------------------------------------------------------------------------

    \372\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
U.S. Dep't of Justice, Civil Rts. Div., Guidance on 
Nondiscrimination in Telehealth: Federal Protections to Ensure 
Accessibility to People with Disabilities and Limited English 
Proficient Persons (July 29, 2022), https://www.hhs.gov/civil-rights/for-individuals/disability/guidance-on-nondiscrimination-in-telehealth/.
---------------------------------------------------------------------------

    Comment: Some commenters requested that OCR apply a broad 
definition of ``telehealth'' requesting inclusion of medical devices, 
tests, and equipment used as part of telehealth services. Other 
commenters requested OCR define telehealth as ``the use of digital 
technology to deliver health care, health information, and other health 
services, including diagnosis, treatment, assessment, monitoring, 
communications, and education.''
    Some commenters also requested that audio-only and remote patient 
monitoring be required to comply with Sec. Sec.  92.201 (Meaningful 
access for individuals with LEP), 92.202 (Effective communication for 
individuals with disabilities), and 92.204 (accessibility of ICT for 
individuals with disabilities).
    Response: OCR has determined it is appropriate to codify the 
definition of the term ``telehealth'' as provided by the Health 
Resources and Services Administration \373\ and the Office of the 
National Coordinator for Health Information Technology \374\ referenced 
in the Proposed Rule at 87 FR 47884. As such, we are adding a 
definition for telehealth to the final rule under Sec.  92.4. which 
will read ``use of electronic information and telecommunications 
technologies to support long-distance clinical health care, patient and 
professional health-related education, public health, and health 
administration. Technologies include videoconferencing, the internet, 
store-and-forward imaging, streaming media, and terrestrial and 
wireless communications.'' Audio-only and remote patient monitoring 
services are included in this definition. Additionally, medical 
devices, tests, and equipment that are used as part of a health program 
or activity delivered through telehealth services must also be 
accessible.
---------------------------------------------------------------------------

    \373\ U.S. Dep't of Health Hum. Servs., Health Rsch. Servs. 
Admin., What Is Telehealth?, https://www.hrsa.gov/rural-health/telehealth/what-is-telehealth.
    \374\ HealthIT.gov, What Is Telehealth? How Is It Different from 
Telemedicine?, https://www.healthit.gov/faq/what-telehealth-how-
telehealth-different-telemedicine.
---------------------------------------------------------------------------

    Comment: Some commenters requested OCR amplify and make clear

[[Page 37652]]

that the privacy provisions under HIPAA are a part of this section. 
Many commenters detailed privacy concerns specific to individuals with 
disabilities and individuals with LEP. For individuals with 
disabilities, concerns were expressed for those who lack privacy in the 
home and might need additional functionality to be able to use 
telehealth privately.\375\ Other commenters described concerns 
individuals with LEP may have about their data being shared with 
immigration or law enforcement.\376\
---------------------------------------------------------------------------

    \375\ Rupa S. Valdez et al., Ensuring Full Participation of 
People with Disabilities in an Era of Telehealth, 28 J. Am. Med. 
Inform. Ass'n 389 (Feb. 2021), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7717308/.
    \376\ Aswita Tan-McGrory et al., Addressing Virtual Care 
Disparities for Patients With Limited English Proficiency, The Am. 
J. of Managed Care (2022) https://www.ajmc.com/view/addressing-virtual-care-disparities-for-patients-with-limited-english-proficiency.
---------------------------------------------------------------------------

    Response: Comments related to HIPAA are outside of the scope of 
this rulemaking. However, we direct commenters to HIPAA guidance we 
have released related to HIPAA and reproductive health care,\377\ 
protecting the security of health information,\378\ and audio-only 
telehealth.\379\ Given our responsibility for HIPAA, OCR is very 
sensitive to privacy concerns among both people with disabilities and 
individuals with LEP and we remain committed to protecting their 
privacy and confidentiality.\380\
---------------------------------------------------------------------------

    \377\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
HIPAA Privacy Rule and Disclosures of Information Relating to 
Reproductive Health Care (June 29, 2022), https://www.hhs.gov/hipaa/for-professionals/privacy/guidance/phi-reproductive-health/.
    \378\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Protecting the Privacy and Security of Your Health Information When 
Using Your Personal Cell Phone or Tablet (June 29, 2022), https://www.hhs.gov/hipaa/for-professionals/privacy/guidance/cell-phone-hipaa/.
    \379\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Guidance on How the HIPAA Rules Permit Covered Health Care Providers 
and Health Plans to Use Remote Communication Technologies for Audio-
Only Telehealth (Jun. 13, 2022), https://www.hhs.gov/hipaa/for-professionals/privacy/guidance/hipaa-audio-telehealth/.
    \380\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., A 
Health Care Provider's Guide to the HIPAA Privacy Rule: 
Communicating with a Patient's Family, Friends, or Others Involved 
in the Patient's Care (Sept. 16, 2008), https://www.hhs.gov/sites/default/files/provider_ffg.pdf.
---------------------------------------------------------------------------

    Comment: One commenter requested that OCR clarify that proposed 
Sec.  92.211 on nondiscrimination through telehealth services does not 
apply to prescribing medication abortion or referring for abortion.
    Response: The specific content of the health services provided via 
telehealth is beyond the scope of this rulemaking. In the same way in 
which we have generally declined to revise the final rule to address 
how a particular provision applies in the context of the provision of a 
particular type of care, we decline to do so here as well.
    Comment: Many commenters wrote that ensuring equitable payment for 
and access to telehealth across a range of modalities (including audio-
only telehealth, audio-video telehealth, real-time text, and in-person 
services), as well as making payment rules for telehealth implemented 
during the COVID-19 Public Health Emergency permanent, is needed to 
ensure nondiscrimination in the administration of telehealth. Other 
commenters said that audio-only telehealth should be reimbursed for 
individuals without smartphones or reliable broadband service. One 
State commenter requested CMS provide additional guidance on how this 
rule would impact service delivery in rural areas in light of CMS' 
audio-only service delivery in Medicare.
    Response: Although OCR is cognizant of and sensitive to health 
equity concerns involving coverage and payment policies for health care 
services delivered via telehealth, such policies are outside the scope 
of OCR authorities and the section 1557 rulemaking. However, in 
general, OCR does not expect the rule to affect audio-only delivery of 
Medicare services in rural areas.
    Comment: Several commenters wrote that inadequate reimbursement of 
telehealth and disparate medical management requirements limiting 
access to telehealth are discriminatory and that such practices ought 
to be prohibited.
    Response: OCR will consider complaints raising the issues of 
whether inadequate reimbursement of telehealth or disparate medical 
management requirements limiting access to telehealth is discriminatory 
under section 1557 on a case-by-case basis. To the extent a covered 
entity's telehealth policies or practices delay or deny an individual's 
access to a health program or activity delivered via telehealth, OCR 
will consider whether the delay or denial is based on prohibited 
grounds under section 1557 as set forth in this rule, including as a 
discriminatory benefit design prohibited under Sec.  92.207(b)(2). 
Covered entities have flexibility in determining the reimbursement 
rates and medical management requirements in their plans, and this rule 
does not establish specific reimbursement requirements or medical 
management requirements. However, as noted elsewhere in this preamble, 
such practices must be implemented in a nondiscriminatory manner.
    Comment: Some commenters requested the rule prohibit covered 
entities from requiring individuals to use telehealth for programs, 
services, and assessments for which telehealth is inappropriate or 
risks substandard services or findings. Some commenters also asked OCR 
to require covered entities to offer in-person alternatives to 
telehealth services.
    Response: OCR recognizes that not all health programs and 
activities are appropriately delivered via telehealth, and OCR will 
review complaints related to payers or providers that require 
individuals to receive programs, services, or assessments via 
telehealth for potential discrimination concerns. However, we decline 
to issue a blanket prohibition on the use of telehealth in specific 
circumstances as requested by commenters, as the use in those 
situations may not be per se discriminatory or there may be a 
legitimate, non-discriminatory reason for the practice.
    A covered entity may need to offer in-person alternatives to 
telehealth, as a reasonable modification for individuals with 
disabilities who cannot be properly provided with effective 
communication or as a reasonable step to provide meaningful access for 
individuals with LEP through telehealth services. However, we decline 
to implement a general requirement that covered entities providing 
telehealth offer an in-person alternative.
    Comment: Many commenters urged that individuals with a disability 
be afforded the opportunity to choose between telehealth and in-person 
care based on the service delivery model that works better for their 
health and communications needs and urged the inclusion of an opt-out 
provision.
    Response: Any individual with a disability who needs to opt-out 
from receiving care via telehealth should request a reasonable 
modification of policies and procedures from the covered entity. Unless 
the reasonable modification fundamentally alters the health program or 
activity, the covered entity should approve an in-person visit.
    Comment: A number of commenters called on OCR to codify WCAG 2.0 
(AA), WCAG 2.1 (AA),\381\ section 508, or related standards for 
telehealth platforms. Some recommended requiring certifications of 
compliance

[[Page 37653]]

from covered entities. One commenter recommended that covered entities 
be required to attest to making their best effort to accommodate 
patient needs. Another commenter suggested an elaborate alternative 
regulatory scheme that would treat telehealth platforms like public 
accommodations. Other commenters suggested that standards should be 
adopted in such a manner as to grant covered entities time to come into 
compliance, and others suggested safe harbors for compliance if a 
covered entity meets WCAG standards.
---------------------------------------------------------------------------

    \381\ Web Content Accessibility Guidelines 2.1 (AA), W3C World 
Wide Web Consortium Recommendation, https://www.w3.org/TR/WCAG21/.
---------------------------------------------------------------------------

    Response: OCR recognizes that this is a complex and evolving area, 
and given the rapid evolution of platforms and technologies, we have 
decided not to adopt specific accessibility standards at this time for 
telehealth platforms, particularly given other ongoing rulemakings in 
this field. Both OCR and DOJ recently issued NPRMs addressing the 
accessibility of web content and mobile apps used by recipients of 
Federal financial assistance and public entities, respectively.\382\ 
Those rulemakings provide greater clarity on obligations to ensure that 
web content and mobile applications are accessible. This rulemaking 
requires covered entities to ensure telehealth platforms are accessible 
to individuals with disabilities, unless doing so would impose undue 
financial and administrative burdens or would result in a fundamental 
alteration in the nature of a covered entity's health programs or 
activities. Specifically, OCR notes that communications before, during, 
and after telehealth appointments must be accessible to individuals 
with disabilities and individuals with LEP, consistent with pre-
existing section 504, title VI, and section 1557 requirements.
---------------------------------------------------------------------------

    \382\ See 88 FR 63392 (Sept. 14, 2023) (HHS) and 88 FR 51948 
(Aug. 4, 2023) (DOJ).
---------------------------------------------------------------------------

    Comment: A number of commenters recommended expanding the 
nondiscrimination requirement of Sec.  92.211 to designated companions 
or caregivers of people with disabilities, since shared involvement is 
often necessary to set and facilitate telehealth appointments.
    Response: Yes, companions with disabilities are covered under the 
effective communications requirements of this rule at Sec.  92.202, and 
therefore we do not believe this language needs to be added. Companions 
with LEP are similarly covered under the meaningful access requirements 
of this rule at Sec.  92.201.
    Comment: Many commenters stated that providers should assess 
individuals with disabilities seeking to use telehealth platforms for 
visual, cognitive, intellectual, mobility, and functional needs, and 
that platforms should be adapted to address the needs of a wide variety 
of people with diverse functional limitations who have difficulties 
communicating through traditional telehealth, including, but not 
limited to, people with visual, hearing, and speech disabilities.
    Response: OCR agrees that such an assessment would be informative 
and is recommended as a best practice and as a means of connecting 
individuals with the most appropriate auxiliary aids and services to 
meet their needs. However, OCR has concluded it is important to allow 
covered entities flexibility in determining whether to assess 
individuals with disabilities seeking to use telehealth platforms. We 
therefore decline to adopt an assessment requirement at this time. 
However, OCR will continue to monitor developments in methodology for 
assessing individuals with disabilities.
    Comment: Many commenters recommended that covered entities be 
required to provide individuals with a Notice of Availability (Sec.  
92.11) when covered entities electronically communicate to individuals 
that they may make telehealth appointments with the covered entity.
    Response: Such a scheduling communication is already covered by 
Sec.  92.11(c)(5)(v), because it relates to services that ``require or 
request a response from a participant, beneficiary, enrollee, or 
applicant.''
    Comment: A significant number of commenters recommended adopting 
detailed specifications and performance standards for accessibility 
features on telehealth platforms for individuals with specific 
disabilities. Several commenters also said OCR needed to provide 
specific requirements related to qualified interpreters on telehealth 
platforms with ``specific provisions addressing accessibility in 
telehealth services and particularly related to access for individuals 
with disabilities and LEP individuals.''
    Response: While OCR appreciates commenters' request for detailed 
performance standards, we decline to adopt such provisions at this time 
given the rapid evolution of platforms and technologies. Requirements 
addressed elsewhere in the rule, including at Sec. Sec.  92.201 
(Meaningful access for individuals with LEP) and 92.202 (Effective 
communication for individuals with disabilities), provide a baseline 
from which covered entities can tailor their compliance. OCR will 
continue to consider issuing additional guidance on this topic.
    Comment: One commenter wrote that audio-only visits are inherently 
inferior to audio-visual telehealth visits as they exclude information 
and meaning conveyed through visual cues, increasing chances for poor 
communications, misdiagnoses, flawed evaluations, and other subpar 
outcomes. This commenter advised requiring in-person care be available 
on the same terms as telehealth.
    Response: Although OCR appreciates the comment and recognizes that 
audio-only telehealth communication may not be appropriate for all 
circumstances, we decline to disallow audio-only as an option for 
telehealth delivery. We believe this would erect an unnecessary and 
unjustified barrier to telehealth for individuals who lack the quality 
or consistent internet access necessary for audio-visual telehealth. As 
stated previously, a covered entity may need to offer in-person 
alternatives to telehealth to ensure effective communication for 
individuals with disabilities (section 504, the ADA, and section 1557), 
or meaningful access for individuals with LEP (title VI and section 
1557), but we decline to implement a general requirement that in-person 
care be available on the same terms as telehealth. For further 
information, we once again direct commenters to the Telehealth 
Guidance.\383\
---------------------------------------------------------------------------

    \383\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
U.S. Dep't of Justice, Civil Rts. Div., Guidance on 
Nondiscrimination in Telehealth: Federal Protections to Ensure 
Accessibility to People with Disabilities and Limited English 
Proficient Persons (July 29, 2022), https://www.hhs.gov/civil-rights/for-individuals/disability/guidance-on-nondiscrimination-in-telehealth/.
---------------------------------------------------------------------------

    Comment: One commenter wrote that, given that telehealth is 
incorporated in ``information and communication technology for 
individuals with disabilities'' (Sec.  92.204), it would be helpful to 
explain the interaction between these two sections.
    Response: This commenter is correct that telehealth is closely 
related to the ICT section. ICT is generally a means by which to 
facilitate access to information in a health program or activity, 
whereas telehealth is a medium through which a health program or 
activity is delivered and for which access is needed. Health programs 
and activities provided through ICT include telehealth, which we define 
as the use of electronic information and telecommunications 
technologies to support long-distance clinical health care, patient and 
professional health-related education, public health, and health 
administration. In contrast, ICT relates to the technology and other 
equipment,

[[Page 37654]]

such as computers and peripheral equipment; information kiosks and 
transaction machines; telecommunications equipment; telehealth 
interfaces or applications; customer premises equipment; multifunction 
office machines; software; mobile applications; websites; videos; and 
electronic documents. Thus, while telehealth interfaces and 
applications are a form of ICT, the rapid expansion of its use by 
providers and broad impact on the health care landscape necessitate 
careful consideration independent of a broader ICT section. The 
telehealth section is designed to ensure that health programs and 
activities delivered via telehealth technologies are done so in a 
manner that does not discriminate.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.211 without modification.

Subpart D--Procedures

Enforcement Mechanisms (Sec.  92.301)
    Proposed Sec.  92.301 provides that the enforcement mechanisms 
available for and provided under title VI of the Civil Rights Act of 
1964, title IX of the Education Amendments of 1972, section 504 of the 
Rehabilitation Act of 1973, and the Age Discrimination Act of 1975 
shall apply for purposes of section 1557 as implemented by the part.
    The comments and our responses regarding Sec.  92.301 are set forth 
below.
    Comment: Many commenters strongly supported OCR's clarification 
that section 1557 provides an independent basis for regulation of 
discrimination in covered health programs and activities. Supporters 
indicated that the rule as proposed would provide for robust 
enforcement of section 1557, consistent with existing law and the clear 
intent of Congress. One commenter expressed support for the different 
mechanisms of enforcement and emphasized the importance of enforcement 
that is level, targeted, and constant to ensure long-term adherence to 
section 1557's nondiscrimination provisions.
    Response: OCR appreciates and acknowledges the need for strong 
enforcement mechanisms in order to adequately address discrimination in 
health programs and activities.
    Comment: One commenter noted that making a clear procedure for 
claims of discrimination on multiple bases is important, not only for 
the complainant to fully understand their rights and remedies, but also 
for the covered entity to know how best to respond to a grievance. 
Commenters also suggested that OCR provide guidance on how covered 
entities should proceed with complaints that involve multiple bases of 
discrimination.
    Response: OCR agrees that it is important to provide clarity to 
both complainants and covered entities regarding the procedures for 
raising a claim under section 1557. We currently offer resources on our 
website to provide the public and covered entities with information 
about the complaint process and how covered entities implement and 
maintain compliance. As discussed in Sec.  92.303, in an effort to 
simplify the complaint process, OCR is revising the regulatory text to 
apply a single administrative enforcement procedure for discrimination 
complaints filed under section 1557, regardless of the alleged basis of 
discrimination. This will eliminate confusion for both covered entities 
and the public with regard to how OCR will evaluate and investigate 
allegations of discrimination brought under this part, including 
allegations involving multiple bases of discrimination. Covered 
entities should handle section 1557 grievances involving multiple bases 
of discrimination under one process. OCR will continue to provide 
guidance to covered entities on an ongoing basis to ensure compliance 
with the rule.
    Comment: Several commenters stated that section 1557 creates a 
health-specific, nondiscrimination private cause of action. They opine 
that, because Congress expressly adopted one provision to prohibit 
discrimination on multiple grounds, the enforcement mechanisms 
available under each of the referenced statutes are not intended to be 
limited to the particular ground of alleged discrimination but rather 
would be available regardless of the ground of discrimination at issue.
    Many commenters strongly recommended that OCR expressly state, as 
it did in the 2016 Rule preamble, that it will interpret section 1557 
as authorizing a private right of action for claims of disparate impact 
for all grounds of prohibited discrimination. They stated that making 
the private right of action language explicit in the rule will provide 
for transparency and patient protection and enable more consistent 
enforcement of section 1557. Commenters stated that without a 
disparate-impact theory of liability, a private right of action will 
ring hollow for people of color and other systemically marginalized 
groups. Additionally, commenters noted that in an era where artificial 
intelligence and automated decision-making are increasingly responsible 
for resource allocation, recognition of disparate-impact liability is 
critical. Other commenters noted that a private right of action is 
essential to ensuring that individuals who experience discrimination on 
the basis of sex in health care are not solely reliant on OCR to 
enforce the law and may be entitled to seek compensation through a 
private right of action for the harm they experience.
    Commenters further stated that the Supreme Court has affirmed the 
right of all private individuals to sue in Federal court to challenge 
violations of the protections of section 1557. Other commenters noted 
that a private right of action is essential to ensuring that 
individuals who experience discrimination on the basis of sex in health 
care are not solely reliant on OCR to enforce the law. Commenters also 
stated that by expressly including enforcement mechanisms ``available 
under'' the statutes, Congress authorized disparate-impact claims to be 
brought under section 1557.
    Finally, commenters raised specific concerns regarding the Age 
Act's administrative exhaustion requirement, 42 U.S.C. 6104(f), and 
many commenters recommended that OCR include regulatory language in the 
final rule clarifying that administrative exhaustion is not required 
before a court action involving multiple bases of discrimination that 
includes age can be filed by the complainant. These commenters stated 
that because section 1557 is its own statute--enforceable by private 
right of action in the courts--an older adult who is discriminated 
against based on age and another basis should not be disadvantaged due 
to the Age Act's administrative-exhaustion requirement.
    Response: Courts have long recognized that section 1557 authorizes 
a private right of action under any of the bases for discrimination. 
OCR declines to revise regulatory text to adopt a stance on the 
appropriate standards that apply to private litigants. This is an issue 
appropriately addressed by the Federal judicial branch and not via 
agency rulemaking.
    Comment: One commenter requested that OCR clarify whether providers 
caring for individuals with disabilities and relatives of such 
individuals have the ability to bring a civil rights action in 
appropriate cases, such as where the provider or relative are 
themselves harmed by the plan's discriminatory conduct.
    Response: OCR cannot provide legal advice as to whether an 
individual can appropriately bring a private claim under section 1557. 
If an individual--

[[Page 37655]]

including providers and relatives of a plan holder--believes they have 
experienced discrimination prohibited by section 1557, they are able to 
file a complaint with OCR. OCR will conduct a case-by-case analysis to 
determine its jurisdiction over the complaint allegations.
    Comment: Some commenters urged OCR to increase enforcement capacity 
through coordination among agencies within the Department, and that the 
final rule should authorize OCR to empower other Department components, 
such as CMS, to investigate and enforce section 1557 claims.
    Response: As a law enforcement agency with specialized knowledge 
and delegated authority over section 1557 enforcement, OCR is the 
agency within the Department that investigates and enforces section 
1557 complaints. However, OCR continues to work with other agencies on 
many different initiatives and issues, including to promote compliance 
with Federal civil rights laws such as section 1557.
    Comment: Some commenters suggested that OCR should pair enforcement 
with robust outreach and education. Several commenters requested that 
OCR postpone any enforcement action until after OCR provides education 
resources and technical assistance, to allow time for different 
practices to come into compliance without penalty.
    Several commenters requested that OCR use enforcement discretion 
for particular groups of providers. For example, one commenter asked 
OCR to provide assurances that pharmacists can use reasonable clinical 
judgment to treat patients within their scope of practice, and not be 
subject to additional administrative burden and legal liability. 
Another commenter requested that OCR use enforcement discretion and not 
penalize physicians for failing to provide interpreter services as long 
as they make reasonable efforts to satisfy the final rule's 
requirements. This commenter also requested that OCR provide guidance 
and support for physicians in rural and other hard to reach areas for 
procuring and using the necessary technology to connect with remote 
interpreters. Specifically, this commenter pointed to concerns with 
physician practices in remote areas where interpreter availability is 
inconsistent and remote connectivity to interpreter services is either 
substandard or non-existent due to the lack of necessary broadband.
    Response: We appreciate the commenters' concern, but section 1557 
has been in effect since 2010 and OCR declines to postpone enforcement 
past the effective date of 60 days after publication of the final rule. 
We note, however, that we have provided delayed implementation dates 
for a number of provisions. Further, prior to taking an enforcement 
action (i.e., terminating Federal financial assistance or referring a 
matter to DOJ for enforcement), OCR must attempt to achieve a covered 
entity's voluntary compliance with the law, such as through providing 
technical assistance and reviewing policies and procedures.\384\
---------------------------------------------------------------------------

    \384\ See, e.g., U.S. Dep't of Health & Hum. Servs., Off. for 
Civil Rts., HHS Office for Civil Rights Resolves Complaints with CVS 
and Walgreens to Ensure Timely Access to Medications for Women and 
Support Persons with Disabilities (June 16, 2023), https://www.hhs.gov/civil-rights/for-providers/compliance-enforcement/agreements/cvs-walgreens/.
---------------------------------------------------------------------------

    Comment: Some commenters recommended adding a new provision 
requiring OCR to publish general information about the number and types 
of complaints received and resolved on a yearly basis and to publicly 
post information regarding resolution agreements within 14 days of 
resolving a complaint.
    Response: Much of the information requested is already provided to 
Congress annually through OCR's Congressional Justifications and these 
annual justifications are also available on OCR's website.\385\ In 
addition, OCR posts its resolution agreements to its website, available 
to anyone to review. We intend to continue with this practice as more 
cases are resolved.
---------------------------------------------------------------------------

    \385\ Current and past OCR Congressional Justifications can be 
found at https://www.hhs.gov/ocr/about-us/budget/.
---------------------------------------------------------------------------

    Comment: Some commenters were also concerned with mandatory 
arbitration agreements and recommended that OCR include a specific 
provision prohibiting insurers from requiring binding arbitration as 
the exclusive means to resolve a complaint arising under section 1557. 
These commenters were concerned that binding arbitration greatly favors 
defendants, particularly large corporations.
    Response: OCR appreciates concerns with regards to arbitration but 
notes that agreements between private parties is beyond the scope of 
this rulemaking.
Summary of Regulatory Changes
    For the reasons set forth above and in the Proposed Rule and 
considering the comments received we are finalizing the provisions as 
proposed in Sec.  92.301, without modification.
Notification of Views Regarding Application of Federal Religious 
Freedom and Conscience Laws (Sec.  92.302)
    In proposed Sec.  92.302, OCR proposed an administrative process 
under which recipients can notify OCR of their views that they are 
exempt from certain provisions of section 1557 due to an applicable 
Federal conscience or religious freedom law. This proposed provision 
was not in either the 2016 or 2020 Rule.
    Proposed Sec.  92.302(a) provided that a recipient may notify OCR 
of its view that it is exempt from certain provisions of this part due 
to the application of a Federal conscience or religious freedom law. 
Proposed Sec.  92.302(b) provided that once OCR receives such 
notification from a particular recipient, OCR shall promptly consider 
those views in responding to any complaints or otherwise determining 
whether to proceed with any investigation or enforcement activity 
regarding that recipient's compliance with the relevant provisions of 
this part. We further explained that any relevant ongoing investigation 
or enforcement activity regarding the recipient shall be held in 
abeyance until a determination has been made under Sec.  92.302(c).
    Proposed Sec.  92.302(c) provided that based on the information 
provided in the notification under Proposed Sec.  92.302(a), OCR may 
determine at any time whether a recipient is exempt from the 
application of certain provisions of this part, or whether modified 
application of the provision is required with respect to specific 
contexts, procedures, or health care services, based on an applicable 
Federal conscience or religious freedom law. In doing so, we further 
explained that OCR will assess whether there is a sufficiently concrete 
factual basis for making a determination and will apply the applicable 
legal standard of the relevant law. Proposed Sec.  92.302(c) also 
provided that OCR will communicate its determination to the recipient. 
Proposed Sec.  92.302(d) provided that if OCR determines that a 
recipient is exempt from the application of certain provisions of this 
part or modified application of the provision is required as to 
specific contexts, procedures, or health care services, based on a 
Federal conscience or religious freedom law, that determination does 
not otherwise limit the application of any other provision of this part 
to the recipient or to other contexts, procedures, or health care 
services.
    The comments and our responses regarding Sec.  92.302 are set forth 
below.

[[Page 37656]]

    Comment: Many commenters expressed support for the proposed 
provision primarily because, in their view, Sec.  92.302 would balance 
the need to protect both the religious and conscience views of 
recipients and the civil rights protections for patients, providers, 
and consumers. In commenting on the purpose of section 1557, one 
religious, organizational commenter stated that it ``strongly supports 
the principle of nondiscrimination in health programs and activities 
established by the ACA and the promulgation of regulations to ensure 
that principle is implemented robustly'' because ``[a]ccess to health 
care is essential to promote and protect the inherent and inalienable 
worth and dignity of every individual.'' Another religious, 
organizational commenter stated that ``[e]nsuring access to health 
coverage and health care, and removing barriers to these, is without 
question a laudable goal.''
    Response: OCR appreciates these commenters' views and agrees that 
Sec.  92.302 allows OCR to fully consider and uphold religious freedom 
and conscience laws as well as civil rights laws for patients, 
providers, and consumers, to ensure broad access to health care for all 
individuals.
    Comment: Many other commenters opposed the addition of Sec.  
92.302. Commenters maintained that the process for notifying OCR of 
their exemption requests would burden religious entities and favor the 
interests of third parties. Some commenters raised concerns that claims 
of third-party harms can be used by opponents of religious liberty as a 
basis for denying any religious exemption. Additionally, a few 
commenters asserted that any investigation by OCR that excludes 
consultation with the Conscience and Religious Freedom Division will 
lead to religious and conscience objectors losing to claims of third-
party harms. Commenters thus requested that OCR explain the types of 
harm that may overcome religious objections.
    Response: OCR appreciates commenters' objections to Sec.  92.302 
and recognizes the request for guidance and clarification. In response 
to commenters who stated that the notification process itself burdens 
religious entities, OCR has added clarifications to the regulatory text 
stating that recipients may rely on the protections in religious 
freedom and conscience laws or seek further assurance of these 
protections from OCR, if they wish. OCR notes that under revised Sec.  
92.302, recipients are not required to seek assurance of an exemption 
in advance but may raise a claim under an applicable Federal religious 
freedom and conscience protection in the context of an OCR 
investigation or enforcement action. Also, we have revised Sec.  
92.302(a) to make clear that, insofar as the application of any 
requirement under this part would violate applicable Federal 
protections for religious freedom and conscience, such application 
shall not be required. This language is consistent with language added 
to Sec.  92.3(c) and has been interpreted by courts to support the 
Department's position that it ``will abide by RFRA in any enforcement 
of Section 1557'' and that the Department ``has never enforced section 
1557 to require a provider with a religious objection to perform gender 
transition services.'' Am. Coll. of Pediatricians v. Becerra, 2022 WL 
17084365 (E.D. Tenn. 2022) (citing to this language from the 2016 Rule 
as support).
    In making determinations under Sec.  92.302, OCR will faithfully 
apply the legal standards set forth in the Federal religious freedom or 
conscience law at issue. For example, RFRA provides that the Federal 
Government may not substantially burden a person's exercise of religion 
unless ``it demonstrates that application of the burden to the person--
(1) is in furtherance of a compelling governmental interest; and (2) is 
the least restrictive means of furthering that compelling governmental 
interest.'' 42 U.S.C. 2000bb-1(b). Further, while case law interpreting 
RFRA requires consideration of any potential third-party harms, such 
harms, where relevant, are one of several factors that will be 
considered. Other Federal religious freedom and conscience laws set 
forth different tests. For example, a provision of the Church 
Amendments, 42 U.S.C. 300a-7, states that the receipt of Federal 
financial assistance (under certain statutes implemented by HHS) ``by 
any individual or entity does not authorize any court or any public 
official or other public authority to require . . . such individual to 
perform or assist in the performance of any sterilization procedure or 
abortion if his performance or assistance in the performance of such 
procedure or abortion would be contrary to his religious beliefs or 
moral convictions,'' id. 300a-7(b)(1). When administering its exemption 
process, OCR will carefully apply the text of these statutes and 
judicial precedents interpreting them, including by being mindful of 
the ways in which the texts of these statutes differ from one another.
    We continue to believe that this approach is most consistent with 
the Federal religious freedom and conscience protections. In addition, 
OCR has consulted with the appropriate Department staff regarding the 
application of religious freedom and conscience protections during this 
rulemaking and will continue to engage staff during OCR's enforcement 
of the final rule.
    Comment: Many commenters said that by not allowing a categorical 
pre-enforcement exemption and instead making the exemption process 
case-by-case, OCR will increase doubt among providers, inviting 
constant reliance upon administrative adjudication and litigation that 
will cost unnecessary time and money. Some commenters asserted that 
OCR's consideration of claims on a case-by-case basis is problematic 
for large health care systems with multiple sites of care. These 
commenters raised concerns that hospital systems would be deprived of 
the clarity and certainty needed to adhere to their religious 
principles and to establish compliance with policies covering all 
member hospitals, such that the health system would ensure that claimed 
exemptions were being appropriately and narrowly applied. These 
commenters claimed that because a recipient would be left with 
significant uncertainty until OCR considered any enforcement action, 
the process of claiming a pre-enforcement exemption with OCR affords 
few assurances of future enforcement protections.
    Still, many other commenters supported the Sec.  92.302 process 
because, in their view, such a case-by-case inquiry allows OCR an 
opportunity to consider objections in the context-specific manner that 
Federal religious freedom laws like RFRA require. Many commenters 
emphasized that in the context of health care under section 1557, the 
government has a compelling interest in not only preventing 
discrimination but ensuring taxpayer dollars are not used to further 
discrimination. Other commenters, however, asserted that RFRA imposes 
an affirmative obligation on the government to respect and protect 
religious liberty and is not a defensive argument for individuals to 
raise on a case-by-case basis.
    Response: OCR understands some commenters' concerns and opposition 
to the proposed provision requiring case-by-case determinations. OCR 
maintains an important civil rights interest in the proper application 
of Federal conscience or religious freedom protections, which requires 
taking a case-by-case approach to such determinations. Among other 
things, this allows OCR to determine whether the government has a 
compelling

[[Page 37657]]

interest in denying an exemption to a particular party; \386\ to 
consider, when relevant under the applicable legal standard, any harm 
an exemption could have on third parties, including other recipients, 
providers, patients, and the public; and to evaluate whether imposing 
burdens on a covered entity is the least restrictive means of 
furthering a compelling government's interest.\387\
---------------------------------------------------------------------------

    \386\ Fulton v. City of Phila., 593 U.S. 522, 541-42 U.S. 
(2021).
    \387\ See Burwell v. Hobby Lobby Stores, Inc., 573 U.S. 682, 739 
(2014) (Kennedy, J., concurring) (``Among the reasons the United 
States is so open, so tolerant, and so free is that no person may be 
restricted or demeaned by government in exercising his or her 
religion. Yet neither may that same exercise unduly restrict other 
persons, such as employees, in protecting their own interests, 
interests the law deems compelling.'').
---------------------------------------------------------------------------

    However, to address commenters' concerns, OCR has revised Sec.  
92.302(a) to state that a recipient may ``rely on applicable Federal 
protections for religious freedom and conscience, and consistent with 
Sec.  92.3(c), application of a particular provision(s) of this part to 
specific contexts, procedures, or health care services, shall not be 
required where such protections apply.'' When a recipient acts based 
upon its good faith reliance that it is exempt from providing a 
particular medical service due to the application of relevant religious 
freedom and conscience protections (e.g., RFRA), OCR will not seek 
backward-looking relief against that recipient even if the recipient 
had not affirmatively sought assurance of an exemption under Sec.  
92.302(b). But if OCR determines, after an investigation, that the 
recipient does not satisfy the legal requirements for an exception, it 
will seek forward-looking relief as appropriate under the facts.
    If the recipient wishes to receive an assurance from OCR regarding 
an exemption under any applicable religious freedom and conscience 
laws, it may do so under Sec.  92.302(b) either prior to, or during the 
course of, an investigation. We understand that there was some 
confusion regarding the ``case-by-case approach'' discussed in how OCR 
proposed to evaluate exemption requests under Sec.  92.302(b). We 
clarify here that a recipient may seek assurance of an exemption 
applying to specific contexts, procedures, or health care services 
generally. When OCR makes a case-by-case determination, this refers to 
the evaluation of the exemption assurance request as a whole--which may 
be requesting assurance of an exemption from a category of procedures 
or health care services. Thus, when we indicate that exemption requests 
will be evaluated on a case-by-case basis, this does not mean that a 
recipient must seek assurance of an exemption each time such procedure 
or health care is sought if an exemption already applies. Rather, a 
recipient may demonstrate that it is entitled to an exemption due to a 
religious or conscience objection to a particular provision in this 
part, as applied to specific contexts, procedures, or health care 
services.
    A recipient may obtain assurance of its exemption in multiple ways 
under Sec.  92.302(b). For example, if a recipient is seeking assurance 
of an exemption while there is no investigation pending, the 
notification to the OCR Director under Sec.  92.302(b) would include: 
(1) identification of the provision of care to which the covered entity 
objects, specifying whether the objection is to the service overall or 
to the provision of care in a specific circumstance (per item (1)); (2) 
an explanation of the legal basis supporting the claim (per item (2)); 
and (3) the factual basis supporting the claim (per item (3)). Thus, 
for example, if a Catholic hospital is seeking an assurance of an 
exemption from having to perform sterilization procedures that would 
conflict with the religious tenets of their institution, their 
notification under Sec.  92.302(b) would potentially include: (1) the 
provision to which there is an objection and that the objection is to 
provision of a procedure overall, i.e., sterilization procedures that 
are prohibited by their religious tenets; (2) that they should be 
exempt under a specified religious freedom or conscience law; and (3) 
evidence that it, for example, never provides sterilization in 
violation of a particular religious or conscience belief for any 
patient, no matter their sex.
    Alternatively, if a covered entity is seeking assurance of an 
exemption during an OCR investigation, it may similarly submit a 
notification under Sec.  92.302(b). This notification would include the 
same information, but the factual basis for the claim would also 
discuss the specific context of the investigation in question. Though 
raised in response to a specific complaint allegation, the recipient 
may use this same notification to seek assurance of an exemption for 
the same circumstances going forward.
    To take an example drawn from enforcement experience, OCR 
investigated allegations that a Catholic hospital discriminated against 
the complainant when it refused to allow his physician to perform a 
hysterectomy as a form of gender affirming care at their facility. The 
hospital confirmed during the investigation: (1) it did not perform the 
particular type of care or procedure (hysterectomy) on any patient 
under the circumstances (as it performs ``direct sterilization'' only 
for ``the cure or alleviation of a present and serious pathology and a 
simpler treatment is not available''); (2) that it was raising a 
defense under RFRA, citing the relevant legal standard; and (3) the 
factual basis for not providing such medical care and how the 
hysterectomy request conflicted with the exercise of its religious 
beliefs. OCR evaluated the complaint and the hospital's response in 
light of its obligations under RFRA, and determined that to require the 
hospital to allow the procedure in question to take place at their 
facility would result in a substantial burden on their religious 
exercise. OCR further found that section 1557's prohibition on sex 
discrimination as applied to the facts of this case was not the least 
restrictive means of achieving the government's compelling interest in 
preventing discrimination and therefore closed the matter.
    Comment: Some commenters who supported the provision expressed 
appreciation that the process outlined in Sec.  92.302 would allow OCR 
to consider an exemption's potential harms to third parties, such as 
patients or the public. Many commenters believed that this type of 
exemption process is structured to promote equity and transparency, 
while ensuring compliance with relevant legal requirements. Multiple 
commenters shared stories about denials of care, including in medical 
situations in which patients were seeking emergency services. One 
commenter reported an instance in which a woman was forced to deal with 
serious health complications when her treatment was delayed after 
emergency room staff learned of her sexual orientation. In another 
example, a commenter recalled that a pediatrician's office refused to 
make an appointment for an infant because the patient's parents were 
lesbians. Other commenters said a hospital refused to allow doctors 
with admitting privileges to provide their patients with, for instance, 
medically necessary gender-affirming care inside their facilities. Many 
commenters stated that even where patients are able to obtain the 
services from another provider, the delay in receiving care may cause 
irreparable harm. Multiple commenters described that the stress of 
being denied medical care and the fear of facing similar denials in the 
future can have serious negative health outcomes.
    Some commenters who supported proposed Sec.  92.302 compared the 
provision to the title IX religious exception, explaining that they 
preferred an administrative process that

[[Page 37658]]

protects religious liberty, such as that proposed in Sec.  92.302, over 
an exception that might be too broad.
    Response: OCR appreciates these comments and agrees that the Sec.  
92.302 exemption process is the better approach.
    Although commenters compared the proposed Sec.  92.302 process with 
the title IX religious exception when expressing their support, OCR 
makes clear that the process provided under Sec.  92.302 is separate 
and apart from title IX and this new provision does not rely upon or 
effectuate title IX's religious exception. Rather, as explained above, 
this provision clarifies the applicability of religious freedom and 
conscience protections and provides a process for OCR to respect 
applicable Federal religious freedom and conscience laws for specific 
recipients, whether or not they are religious organizations, in its 
enforcement of section 1557.
    Comment: Several commenters who opposed this provision requested 
that OCR provide recipients with a categorical exemption, similar to 
what, in their view, was captured by the 2020 Rule through the 
importation of the title IX religious exception. In these commenters' 
view, such importation would provide a categorical exemption from 
providing procedures that would violate their religious beliefs. Many 
commenters also argued for incorporation of the title IX religious 
exception to address their concerns over what they viewed as the 
complexities, inconsistencies, and unpredictable nature of the Sec.  
92.302 process.
    Many other commenters also stated that the process at Sec.  92.302 
is too burdensome and unclear, and in their view, it would effectively 
prohibit a provider from abstaining from procedures that violate their 
religious convictions. Additionally, some commenters stated that these 
burdens were unfair to religious employers, especially small employers, 
who the commenters said will refrain from applying for Federal funding, 
further harming patients due to limited providers.
    A few commenters stated that, as proposed, Sec.  92.302 forces 
religious entities to expose themselves to potential sanctions by 
requesting an exemption. Requesting any exemption, commenters argued, 
makes the recipient a target for an agency that, in their view, is a 
``bully'' to religious organizations. Several commenters expressed 
concerns that in requesting an exemption, the recipient will lose, in 
their views, its ``privacy and anonymity,'' which could have a chilling 
effect on its provision of health care services.
    Response: OCR appreciates and respects commenters' concerns 
relating to their religious convictions. The Sec.  92.302 process 
demonstrates OCR's concerted effort to enforce Federal 
antidiscrimination laws and apply Federal religious freedom and 
conscience laws. Section 92.302 provides an administrative process, not 
implemented in either the 2016 or 2020 Rule, which responds to the 
shortcomings of both rules. Through the Sec.  92.302 process, OCR is 
committed to implementing a rule that clarifies legal obligations and 
maintains transparency about its enforcement mechanisms.
    Moreover, as previously addressed, supra, at Sec.  92.208, OCR 
complies with the protections in the ACA itself; the Church, Coats-
Snowe, and Weldon Amendments; the generally applicable requirements of 
RFRA; and other applicable Federal laws that provide religious freedom 
and conscience protections--Sec.  92.302 provides an administrative 
process through which providers may rely upon and assert these 
protections.\388\ This provision helps ensure that recipients have an 
opportunity to seek assurance from OCR about the application of 
religious freedom and conscience protections. OCR does not seek to 
deprive a recipient of their ``privacy or anonymity,'' and the 
information requested is only that which is necessary to provide 
assurance of the exemption or modification that the recipient is 
seeking.
---------------------------------------------------------------------------

    \388\ See also U.S. Dep't of Health & Hum. Servs., Safeguarding 
the Rights of Conscience as Protected by Federal Statutes, Final 
Rule, 89 FR 2078 (Jan. 11, 2024).
---------------------------------------------------------------------------

    To clarify further, recipients may seek an assurance of an 
exemption under these Federal religious freedom and conscience laws at 
various points in time, including prior to an investigation or during 
an ongoing OCR proceeding. To begin, as explained above, a recipient 
may avail itself of the general application of Sec.  92.302(a) and 
``rely on applicable Federal protections for religious freedom and 
conscience, and application of a particular provision(s) of this part 
to specific contexts, procedures, or health care services, shall not be 
required.'' Should the recipient seek an assurance, it may--prior to 
any administrative investigation and enforcement--do so by filing a 
notification with OCR under Sec.  92.302(b). OCR will then acknowledge 
receipt of the notification within 30 days, and the recipient may rely 
on a temporary exemption, per Sec.  92.302(c)(1), while OCR adjudicates 
the assurance of exemption request. In instances where OCR has already 
initiated an investigation, the recipient may, during the pendency of 
that investigation, similarly notify OCR of their belief they are 
entitled to an exemption under the process provided at Sec.  92.302(b). 
The notification will serve as a defense to the relevant investigation 
or enforcement activity, and a temporary exemption will then be in 
place per Sec.  92.302(c)(2), pending OCR's determination regarding the 
request for assurance of the exemption or the conclusion of the 
investigation.
    Finally, OCR disagrees with and respectfully objects to the 
characterization that it seeks to ``bully'' religiously affiliated 
recipients or expose them to potential sanctions. Religiously 
affiliated hospitals and health care facilities play a large role in 
the health care system, and OCR recognizes the critical patient care 
needs they provide, particularly in reaching underserved communities. 
As previously stated, the 2022 NPRM provided factual findings with 
respect to health care accessibility in the United States based upon 
health care capacity by providers, population demands, and geographic 
limitations. 87 FR 47840. A detailed discussion about these 
considerations can be found in the Regulatory Impact Analysis. In 
addition, OCR seeks to ensure Federal civil rights protections are 
fulfilled and has consulted with the appropriate staff regarding the 
application of religious freedom and conscience protections during this 
rulemaking and will continue to engage such staff during OCR's 
enforcement of the final rule.
    Comment: Many commenters inquired about OCR's timeline for reaching 
a determination on a recipient's request. Specifically, commenters 
objected to the language in proposed Sec.  92.302(c) that provides 
that, ``OCR may determine at any time whether a recipient is exempt 
from the application of certain provisions of this part'' because, in 
their view, this leaves open-ended the start and end points of the 
process. Some commenters opined that this uncertainty could result in 
disruptions or inappropriate denials of care while a recipient awaits a 
determination. Other commenters suggested that OCR amend Sec.  
92.302(c) to clarify what is intended by the clause ``may determine at 
any time'' because it may conflict with the provision in Sec.  
92.302(b) that such determinations will be made ``promptly.''
    Many commenters recommended that OCR publish the anticipated 
timeframe for OCR's review of exemption requests, notify the requesting 
individuals/organizations about when OCR anticipates their review will 
be

[[Page 37659]]

complete, and instruct the requesting individual/organization to notify 
patients if they will not be offering the service or treatment under 
review during that period. Commenters expressed the need to set a 
reasonable timetable to ensure that requests for exemptions are 
processed quickly to not impede or delay patient care. Some commenters 
also proposed that OCR publicize de-identified data on conscience 
claims and their respective review timelines to ensure public and 
private entities can monitor any access issues, should they occur.
    Many commenters who opposed the process described in Sec.  92.302 
explained that the provision lacks the guidance or clarity necessary 
for recipients to comply. For example, several commenters noted that in 
proposed Sec.  92.302(a), OCR merely invites health care entities to 
express their views on whether their Federal religious freedom and 
conscience rights would be violated but provides no information about 
when a response should be expected. Some commenters explained that 
proposed Sec.  92.302(b) appears to contemplate that recipients would 
wait until they are investigated or subject to an enforcement action 
before notifying OCR of their view that Federal religious freedom and 
conscience laws protect them. According to commenters, as proposed, 
Sec.  92.302 provides no incentive for recipients to notify OCR any 
earlier than that, since the subsection appears to impose no obligation 
on OCR to weigh the notification or request until such an investigation 
or enforcement action is live.
    Other commenters pointed to the purported lack of guidance 
regarding the types of records and facts that would assist OCR in 
reaching a determination on the exemption request. Some commenters 
asserted that Sec.  92.302(c) also does not explain how OCR will make 
final determinations and omits discussion of a recipient's potential 
recourse for appeal in the event of an adverse decision from OCR.
    Response: OCR appreciates commenters' suggestions and concerns and 
understands the desire for additional clarity and an established 
timeline under which OCR will process requests for assurances of 
exemptions and notify recipients of any determination. We agree that 
there is value in providing more detail regarding what obligations OCR 
and recipients have during this process, and so have revised Sec.  
92.302. These revisions provide, among other things: (1) a general 
application provision stating that a recipient may rely on applicable 
Federal protections for religious freedom and conscience; (2) clarity 
on what a notification for an assurance of a conscience or religious 
freedom exemption must contain; (3) a temporary exemption that will 
take effect upon the recipient's submission of the notification, 
regardless of whether the recipient is being investigated, and that 
will remain valid during the pendency of OCR's review of the request 
and any administrative appeal; (4) a general timetable under which OCR 
will acknowledge and begin to evaluate requests for assurances of 
exemptions; (5) additional clarity with regard to the scope of an 
exemption that has been assured under Sec.  92.302(d); and (6) an 
administrative appeal process for recipients receiving adverse 
determinations.
    First, Sec.  92.302(a) now provides that a recipient may rely on 
applicable Federal protections for religious freedom and conscience, 
and application of a particular provision(s) of this part to specific 
contexts, procedures, or health care services, shall not be required, 
and does not violate section 1557 if it so relies.
    Second, Sec.  92.302(b) now provides that a recipient may notify 
OCR of its view that it is exempt from certain provisions of this part 
due to the application of Federal protections for religious freedom and 
conscience and seek assurance of that exemption. This notification must 
be in writing directed to the OCR Director and the notification must 
include (1) the particular provision(s) of this part to which the 
recipient objects; (2) the legal basis supporting the assurance of 
exemption request, including the standards governing the applicable 
conscience or religious freedom law; and (3) the factual basis 
supporting the recipient's view that it is exempt, including 
identification of the conflict between the recipient's conscience or 
religious beliefs and the application of a provision in this part, 
which may include the specific contexts, procedures, or health care 
services that the recipient asserts will violate their conscience or 
religious beliefs overall.
    Third, Sec.  92.302(c) now provides that a recipient's notification 
and request for an assurance of an exemption to OCR will trigger the 
extension of a temporary exemption to the recipient. This exemption 
will cover the period of time it takes OCR to reach a determination on 
the request. The temporary exemption shall apply only to the 
provision(s) as applied to specific contexts, procedures, or health 
care services identified in the recipient's notification to OCR and 
will exempt conduct that occurs during the pendency of OCR's review and 
determination regarding the assurance of exemption request. In the 
event that there is an investigation or enforcement activity regarding 
the recipient related to the specific provisions for which an assurance 
of exemption has been requested, the temporary exemption will serve as 
a defense through the investigation or until OCR has made a 
determination on the assurance of exemption request, or through the 
administrative process if the recipient seeks an appeal under Sec.  
92.302(e). During this time, a recipient's temporary exemption shall 
remain effective. OCR will work promptly to reach a determination 
regarding the request.
    Fourth, with respect to OCR's expected timetable for review, Sec.  
92.302(c) now provides that for pre-enforcement requests for an 
assurance of an exemption, OCR shall provide the recipient with email 
confirmation within 30 days of a recipient's notification acknowledging 
receipt of their request and stating that OCR will work expeditiously 
to reach a determination. If the request for an assurance of religious 
freedom and conscience exemption is received during the pendency of an 
investigation, it shall serve as a defense to the relevant 
investigation or enforcement activity until the final determination of 
the recipient's request, the conclusion of the investigation, and any 
relevant appeal. The temporary exemption shall exempt the recipient 
from the provision of care at issue in the investigation until a final 
determination is made on recipient's notification request or 
investigation, or during the pendency of any appeal.
    Fifth, OCR has revised Sec.  92.302(d) to clarify the effect of an 
exemption. The assurance of an exemption would exempt the recipient 
from OCR's administrative investigation and enforcement with regard to 
the application of a particular provision, which may include the 
specific contexts, procedures, or health care services that the 
recipient asserts will violate their conscience or religious beliefs. 
The exemption assurance will not apply to all contexts, procedures, or 
health care services. A recipient must otherwise have a legitimate, 
nondiscriminatory reason for denying or limiting service outside the 
scope of the granted exemption assurance, and any such decision must 
not be based on unlawful animus or bias, or constitute a pretext for 
discrimination. For example, a hospital with a religious exemption to 
not provide sterilizations outside of those permitted under their 
religious tenets may not rely on the exemption to broadly decline all 
health care services,

[[Page 37660]]

e.g., cancer treatments, to any individual if the hospital otherwise 
provides that care.
    Sixth, Sec.  92.302(e) now clarifies that a recipient may appeal an 
OCR determination under this section. The relevant revisions provide 
that recipients subject to an adverse determination of their request 
for assurance of an exemption may appeal OCR's determination of that 
request. Recipients who have been denied an exemption assurance under 
Sec.  92.302 may raise their request before an administrative hearing 
examiner from the Department with the same procedural protections 
outlined for such administrative hearings under 45 CFR part 81. The 
temporary exemption granted under Sec.  92.302(c) would remain in 
effect until completion of the administrative appeal process.
    Comment: Many commenters supportive of the outlined process also 
urged OCR to revise proposed Sec.  92.302 to require OCR to make 
publicly available, or publish on its website, all determinations for 
any exemptions claimed or granted under Sec.  92.302. A few commenters 
made specific suggestions for what the public postings should contain. 
These commenters proposed that postings should include the name(s) of 
the recipient requesting the exemption, the factual basis asserted by 
that recipient demonstrating its eligibility under Federal law, OCR's 
analysis of those facts, and the specific provision(s) of the rule to 
which an exemption is recognized. A handful of other commenters raised 
the possibility of requiring exemption determinations to be published, 
within 10 days of issuance, in the Federal Register and on the 
Department's website. Commenters also suggested that the notice should 
be accompanied by an electronic link to documents that specifically 
state the nature, scope, and duration of the exemption granted.
    Many commenters discussed that, in addition to promoting 
transparency, providing notice to the public of religious and 
conscience exemptions granted would provide guidance both to providers 
and patients regarding their rights and responsibilities under section 
1557, reducing confusion that can impede equitable access to care, 
particularly for the vulnerable populations the rule is designed to 
protect. Many commenters stated that it is important that individuals 
seeking care or coverage know whether the health providers or issuers 
they are considering do, in fact, provide the services they need--
including whether they will be presented with all available care 
options--and whether they will feel accepted and welcomed by the 
provider they see.
    Response: OCR appreciates commenters' suggestions for revisions to 
the rule to provide notice to the public regarding assurances of 
exemptions granted under this provision, including through having OCR 
post information regarding such assurances. Consistent with our title 
IX regulations and those of other agencies,\389\ OCR declines to revise 
Sec.  92.302 to require affirmative notice of exemptions sought by or 
granted to recipients under this provision. OCR notes that nothing in 
this final rule prevents a recipient from providing public notice of 
any such exemption assurances it has sought or received and we 
encourage recipients to do so. We recognize that individuals are not 
always aware that the health care entities from which they seek care 
may be limited in the care they provide, and remain committed to 
working with recipients and the public to improve transparency, 
clarity, and access to health care through implementation of this rule. 
As noted above, OCR is also subject to FOIA, and information may be 
released to a requestor or made available for public inspection 
consistent with the agency's obligations under that statute and its 
implementing regulations.
---------------------------------------------------------------------------

    \389\ See, e.g., 45 CFR 86.12 (no notice requirement); see, 
e.g., 34 CFR 106.12 (Department of Education, same).
---------------------------------------------------------------------------

    Comment: Some commenters also criticized the process laid out in 
Sec.  92.302 for failing to identify who will evaluate the exemption 
requests. One commenter stated that most recipients will likely wait to 
raise their religious defenses in litigation, as they see courts as the 
only neutral decisionmakers. A handful of commenters also raised 
concerns that the 2022 NPRM did not mention OCR's 2019 final rule, 
Safeguarding the Rights of Conscience as Protected by Federal Statutes, 
84 FR 23170 (May 21, 2019), or its applicability to numerous Federal 
statutes protecting religious freedom and conscience in health care. As 
a result of this omission, these commenters expressed skepticism about 
OCR's ability to apply the regulatory provisions contained in that 
rule.
    Several commenters also questioned the interaction between the 
proposed exemption process and private rights of action. They stated 
that while the Sec.  92.302 process would apply to OCR investigations 
and enforcement, the provision did not address situations where a 
lawsuit has been filed, as there is no across-the-board requirement 
that the administrative process be exhausted before going to court. 
Commenters assumed that faith-based hospitals likely will be forced to 
litigate claims in the courts without the ability to stay proceedings 
pending OCR's consideration of their exemption claim--another factor, 
they argued, which undermined the usefulness of the proposal.
    Response: OCR appreciates commenters' concerns regarding the 
process for review. OCR refers commenters to the six specific steps 
outlined above detailing what obligations OCR has, and what options are 
available to recipients. And as stated previously, OCR is committed to 
enforcing all Federal civil rights laws under its purview. While OCR 
appreciates comments regarding the 2019 Safeguarding the Rights of 
Conscience as Protected by Federal Statutes final rule, as a result of 
challenges to its legality, that rule has been vacated.\390\ OCR has 
published its final rule on enforcement of religious freedom and 
conscience laws. See Safeguarding the Rights of Conscience as Protected 
by Federal Statutes, 89 FR 2078 (Jan. 11, 2024). Finally, OCR would not 
open or continue an investigation under section 1557 against the 
recipient regarding compliance with a provision for which they have 
requested an exemption assurance while a temporary exemption under 
Sec.  92.302(a) is in effect, or after a final determination is made 
that the recipient is entitled to an exemption. While such commenters 
are correct that a temporary or final assurance of an administrative 
exemption from OCR would not itself preclude any private lawsuit under 
section 1557, OCR notes that the recipient could still raise the 
relevant Federal conscience or religious freedom law as a possible 
defense in judicial proceedings in such private litigation. And in 
cases where OCR has assured the recipient an exemption under Sec.  
92.302, the recipient could argue that that assurance is evidence that 
a Federal religious freedom or conscience law likely applies to the 
recipient in any private litigation under this final rule.
---------------------------------------------------------------------------

    \390\ New York v. HHS, 414 F. Supp. 3d 475, 580 (S.D.N.Y. 2019) 
(``Accordingly, as a remedy, the Court vacates the 2019 Rule in its 
entirety, pursuant to [the Administrative Procedure Act] Sec.  
706(2).''), appeal dismissed without prejudice to reinstatement, 
Nos. 19-4254 et al. (2d Cir.); see also Washington v. Azar, 426 F. 
Supp. 3d 704 (E.D. Wash. 2019), appeal pending, No. 20-35044 (9th 
Cir.); City & Cnty. of San Francisco v. Azar, 411 F. Supp. 3d 1001 
(N.D. Cal. 2019), appeal pending, Nos. 20-15398 et al. (9th Cir.).
---------------------------------------------------------------------------

Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the

[[Page 37661]]

comments received, we are finalizing the provision as proposed in Sec.  
92.302, with modifications. First, we are adding a Sec.  92.302(a), 
which provide that a recipient may rely on applicable Federal 
protections for religious freedom and conscience, and consistent with 
Sec.  92.3, application of a particular provision(s) of the part to 
specific contexts, procedures, or health care services shall not be 
required where such protections apply.
    Second, we are revising the process laid out in proposed Sec.  
92.302(b) through (d) as follows. We are revising Sec.  92.302(b) to 
provide that a recipient that seeks assurance consistent with Sec.  
92.302(a) regarding the application of particular provision(s) of the 
part to specific contexts, procedures, or health care services may do 
so by submitting a notification in writing to the Director of OCR. 
Notification may be provided by the recipient at any time, including 
before an investigation is initiated or during the pendency of an 
investigation, and provides details on what must be submitted in 
writing to the OCR Director. We are revising Sec.  92.302(c) to provide 
that a temporary exemption from administrative investigation and 
enforcement will take effect upon the recipient's submission of the 
notification--regardless of whether the notification is sought before 
or during an investigation, and then delineates the scope and 
application of the temporary exemption. We are revising Sec.  92.302(d) 
to provide that if OCR makes a determination to provide assurance of 
the recipient's exemption from the application of certain provision(s) 
of the part or that modified application of certain provision(s) is 
required, the recipient will be considered exempt from OCR's 
administrative investigation and enforcement with regard to the 
application of that provision as applied to the specific contexts, 
procedures, or health care services provided in the written 
determination. The determination does not otherwise limit the 
application of any other provision of the part to the recipient or to 
other contexts, procedures, or health care services.
    Third, we are adding Sec.  92.302(e) to provide an administrative 
appeal process for recipients subject to an adverse determination of 
its request for an assurance of religious freedom and conscience 
exemption. Fourth, we are adding Sec.  92.302(f) to provide that a 
determination under this section is not final for purposes of judicial 
review until after a final decision under 45 CFR part 81.
Procedures for Health Programs and Activities Conducted by Recipients 
and State Exchanges (Sec.  92.303)
    Section 92.303 proposed the enforcement procedures related to 
health programs and activities conducted by recipients and State 
Exchanges.
    In Sec.  92.303(a), OCR proposed applying the procedural provisions 
in the title VI regulation with respect to administrative enforcement 
actions concerning discrimination on the basis of race, color, national 
origin, sex, and disability under section 1557.
    Proposed Sec.  92.303(b) applied Age Act procedures to enforce 
section 1557 with respect to age discrimination complaints against 
recipients and State Exchanges.
    Proposed Sec.  92.303(c) stated that when a recipient fails to 
provide OCR with requested information in a timely, complete, and 
accurate manner, OCR may, after attempting to reach a voluntary 
resolution, find noncompliance with section 1557 and initiate the 
appropriate enforcement procedure, found at 45 CFR 80.8.
    The comments and our responses regarding Sec.  92.303 are set forth 
below.
    Comment: Many commenters recommended that Sec.  92.303(a) 
explicitly recognize claims of discrimination involving multiple 
grounds, and suggested adding the language ``or a combination 
thereof.''
    Response: As discussed in Sec.  92.101, OCR agrees with this 
recommendation and we have added ``or any combination thereof'' 
throughout the regulatory text.
    Comment: Commenters generally supported adoption of title VI 
procedural provisions with respect to administrative enforcement 
actions; however, they noted that OCR proposed to process complaints 
alleging discrimination on the basis of age differently given the 
adoption of Age Act regulation requirements under Sec.  92.303(b). 
These commenters recommended that OCR clarify that for administrative 
enforcement, it will treat claims involving multiple bases, such as age 
and other protected identities, under the same procedural provisions as 
title VI.
    Response: The Proposed Rule followed the 2016 Rule's approach to 
administrative enforcement procedures for complaints on the basis of 
race, color, national origin, sex, and disability, applying the 
procedures found in the title VI regulation. The Proposed Rule proposed 
to apply the Age Act regulatory procedures to age-based complaints. The 
Age Act procedures uniquely contain a requirement that the Department 
refer all sufficient complaints to mediation upon receipt; unresolved 
complaints will be returned to the Department. 45 CFR 91.43. The 
timeline for mediation is generally 60 days, unless a resolution is 
reached sooner, or the mediator has extended the time period for no 
more than 30 days. Id. at Sec.  91.43(e). The 60-day period counts as 
part of the 180 days the Department has to resolve a complaint before a 
court action can be filed by the complainant. 47 FR 57850, 57856 (Dec. 
28, 1982). The mediation requirement derives entirely from the HHS Age 
Act regulations. The Age Act statute does not itself mandate referral 
for mediation. It merely directs agencies to publish regulations that 
``provide appropriate investigative, conciliation, and enforcement 
procedures.'' 42 U.S.C. 6104(a)(4).
    In adopting the mediation requirement, the Department stated that 
the Age Act regulations offered ``a unique opportunity to try [the] 
innovative approach'' to resolution of complaints and committed to 
monitoring the effectiveness of the mediation process. 47 FR 57850, 
57856 (Dec. 28, 1982). According to the Department's 2021 Age Act 
Report, the Department referred 32 complaints for mediation, and two 
were successfully mediated (6 percent).\391\ Eight of 21 (38 percent) 
cases were successfully mediated in 2020, and eight of 48 (17 percent) 
were successfully mediated in 2019.\392\ Thus, the average success rate 
of mediation for complaints alleging age discrimination is roughly 18 
percent. When a complaint is returned to the Department, it follows the 
title VI procedural provisions for investigations and enforcement. 45 
CFR 91.47.
---------------------------------------------------------------------------

    \391\ Annual Report to Congress on Implementation of the Age 
Discrimination Act of 1975--Fiscal Year 2021, p. 32, https://www.hhs.gov/sites/default/files/age-act-2021-report.pdf.
    \392\ Annual Report to Congress on Implementation of the Age 
Discrimination Act of 1975--Fiscal Year 2019, p. 30, https://www.hhs.gov/sites/default/files/age-act-2019-report.pdf; Annual 
Report to Congress on Implementation of the Age Discrimination Act 
of 1975--Fiscal Year 2020, p. 32, https://www.hhs.gov/sites/default/files/age-act-2020-report.pdf.
---------------------------------------------------------------------------

    We agree that individuals filing complaints with OCR under any of 
the bases for discrimination, including on the basis of age, should not 
be subject to unnecessary administrative hurdles. Given that the Age 
Act mediation requirement is not required by statute, but rather was an 
``innovative'' approach adopted by the Department under its 
administrative authority to implement the Age Act, we have determined 
that OCR has the authority to not import such a requirement into the 
section 1557 procedures. While

[[Page 37662]]

mediation may prove beneficial under certain circumstances, as 
reflected through the Department's reporting on Age Act enforcement, it 
is not successful in all cases.
    Given concerns raised by commenters, the value OCR places on the 
efficient and timely resolution of complaints, and the potentially 
sensitive nature of complaints raised under section 1557, we revisited 
the proposal to require complainants to engage in mandatory mediation. 
After review, and in light of these considerations and a desire for 
consistency across section 1557 administrative enforcement, we are 
revising the regulatory text to strike proposed Sec.  92.303(b), which 
would have applied the Age Act procedural provisions to administrative 
enforcement actions concerning age discrimination. We are also revising 
Sec.  92.303(a) to apply the title VI procedures to all administrative 
enforcement actions brought under section 1557.
    This means that a complaint filed under section 1557 alleging age 
discrimination would not require the complainant to engage in mediation 
before OCR can open an investigation and claims alleging multiple bases 
of discrimination would be subject to the same enforcement procedures 
under the final rule. We note that complainants that wish to engage in 
mediation to address a complaint against a recipient or State Exchange 
will be provided with the option to do so, as these complaints may also 
be addressed under the Age Act, consistent with 45 CFR 91.43.
    Comment: Commenters suggested making the OCR complaint process more 
straightforward and accessible, especially since individual complaints 
remain the primary trigger for investigations and individuals often 
file without legal representation. Commenters suggested that the final 
rule offer clear, fully accessible complaint mechanisms, including 
directions written in plain language, for filing discrimination 
complaints. These commenters suggested that complainants should not be 
required to parse out how a covered entity perceived them or responded 
to differing aspects of their lives. Further, these commenters 
recommended that any complaint procedures include resource materials 
such as Frequently Asked Questions, process diagrams, and materials 
presented in alternative formats, including videos with instructions in 
ASL embedded into the website as well as a clear and simple complaint 
process for individuals with LEP. One commenter further suggested that 
OCR clarify in the final rule that citizenship status is not relevant 
to an enforcement process or complaint filing.
    One commenter also recommended that the time allowed for filing a 
complaint without needing to show good cause be extended from 180 days 
to 6 years to account for the postpartum timeline. Another commenter 
urged OCR to consider putting the longest deadline on the complaint 
filing that it can, consistent with its statutory obligations. This 
commenter noted that it often takes people months to realize they have 
been discriminated against, decide to do something about that 
discrimination, and find out that there are laws against the 
discrimination and agencies like OCR where they can file complaints.
    Response: OCR appreciates the comments regarding the complaint 
process. We understand the complaint filing process may be both 
perceived and experienced as challenging, and OCR welcomes suggestions 
on making the process more accessible. We currently offer resources on 
our website to provide the public with information about the process 
for submitting a complaint and what to expect once they have submitted 
a complaint to OCR.\393\ In addition, OCR revises its own processes, as 
needed. The most recent updates to OCR's Civil Rights Discrimination 
Complaint Form and Portal, for example, include providing the form and 
portal in fifteen languages other than English, and inclusion of 
additional clarity regarding forms of discrimination to report, 
including sexual orientation, gender identity, pregnancy, and 
discrimination against individuals with LEP.\394\ We consider changes 
to the OCR complaint process on an ongoing basis as we strive to 
simplify the process and make it more accessible to all.
---------------------------------------------------------------------------

    \393\ U.S. Dep't Health & Hum. Servs., Off. for Civil Rts., 
Filing a Civil Rights Complaint, https://www.hhs.gov/civil-rights/filing-a-complaint/.
    \394\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Complaint Portal, https://ocrportal.hhs.gov/ocr/cp/complaint_frontpage.jsf; U.S. Dep't of Health & Hum. Servs., Off. 
for Civil Rts., Get Help in Other Languages, https://www.hhs.gov/ocr/get-help-in-other-languages/; U.S. Dep't of Health & 
Hum. Servs., Off. for Civil Rts., Office for Civil Rights, Civil 
Rights and Conscience Complaint form (Expiration Date: Dec. 31, 
2025), https://www.hhs.gov/sites/default/files/ocr-cr-complaint-form-package.pdf.
---------------------------------------------------------------------------

    OCR notes that the requirement that a complaint be filed no later 
than 180 days from the alleged discrimination is consistent with the 
enforcement mechanisms under title VI, which we adopt herein and have 
also been adopted under title IX, section 504, and the Age Act. OCR 
will continue to extend the 180-day filing deadline for good cause, as 
outlined in the title VI regulation at 45 CFR 80.7(b). Further, to make 
this information more widely available, we are reinstating a required 
Notice of Nondiscrimination (Sec.  92.10), which includes information 
on how to file a complaint with OCR should an individual believe they 
were discriminated against.
    In response to the comments received, OCR also notes that 
citizenship status is not relevant to an enforcement process or 
complaint filing; an individual's citizenship or immigration status 
does not prevent or alter their ability to file a complaint or OCR's 
ability to enforce potential violations.
    Comment: Some commenters indicated that OCR should initiate 
compliance reviews rather than wait on individual complaints and some 
noted that while a simple, accessible complaint system is helpful, it 
should not, and cannot be, the only means of enforcement. Commenters 
stated that robust enforcement must include agency-initiated oversight, 
monitoring, and investigations; and that OCR should proactively review 
medical providers' treatment of patients of color for patterns to help 
detect bias.
    A few commenters stated that incorporating the title VI procedures 
in proposed Sec.  92.303(a) means including requirements that covered 
entities submit compliance reports and data to OCR and authorizing OCR 
to conduct periodic compliance reviews of covered entities. These 
commenters argued that OCR is effectively declaring that its 
enforcement of these provisions will be based on the presumption that 
any business decision made by a covered entity is either intentionally 
discriminatory or has an impermissibly discriminatory effect, unless 
and until that entity can demonstrate otherwise to OCR's satisfaction. 
According to the commenters, this would have the effect of imposing an 
expansive, arbitrary, and capricious new regulatory regime.
    Response: OCR appreciates the importance of compliance reviews and 
robust enforcement. While most OCR investigations are conducted based 
on complaints received, OCR also conducts compliance reviews, which may 
be based on, for example, news reports or other information received by 
OCR.\395\
---------------------------------------------------------------------------

    \395\ For example, on March 7, 2023, OCR announced that it had 
reached a Voluntary Resolution Agreement with Hillsborough County 
Fire and Rescue in Florida to improve access to care for communities 
of color. OCR initiated a compliance review of Hillsborough County 
Right and Rescue in response to public press reports indicating that 
its paramedics refused to transport an African American woman to the 
hospital because they assumed she could not afford the ambulance 
cost due to her race. See U.S. Dep't Health & Hum. Services, Off. 
for Civil Rts., HHS Office for Civil Rights Reaches Agreement with 
Hillsborough County Fire and Rescue in Florida to Improve Access to 
Care for Communities of Color, https://www.hhs.gov/about/news/2023/03/07/hhs-office-for-civil-rights-reaches-agreement-with-hillsborough-county-fire-and-rescue-in-florida.html. In June of 
2022, OCR entered into a Voluntary Resolution Agreement with the 
University of Southern California (U.S.C.) and Keck Medicine of 
U.S.C. (collectively, the ``KMUSC Entities'') resolving a compliance 
review of KMUSC Entities' policies and procedures for responding to 
sex discrimination complaints made by students, employees, or 
patients employed by, or participating in, any KMUSC programs or 
activities receiving Federal financial assistance from HHS. See U.S. 
Dep't Health & Hum. Servs., Off. for Civil Rts., HHS Voluntary 
Resolution Agreement with the University of Southern California 
Settles Title IX Compliance Review, https://www.hhs.gov/about/news/2022/06/15/hhs-voluntary-resolution-agreement-with-university-of-southern-california-settles-title-ix-discrimination-complaints.html.

---------------------------------------------------------------------------

[[Page 37663]]

    OCR disagrees with commenters' position that adopting the 
longstanding enforcement procedures of title VI creates a presumption 
that a covered entity is discriminating. Nor does the adoption of these 
procedures represent a new ``regulatory regime,'' as these procedures 
appear in the Department's title VI regulations, which were originally 
published in 1964 \396\ and have since been adopted in the Department's 
title IX and section 504 regulations. Section 92.303, adopting 45 CFR 
80.6 (Compliance information), includes standard requirements related 
to civil rights enforcement, including seeking cooperation from 
recipients and State Exchanges in obtaining compliance; providing 
assistance and guidance to assist recipients and State Exchanges reach 
voluntary compliance; requiring records maintenance by recipients and 
State Exchanges so that they may demonstrate compliance with the 
conditions of their receipt of Federal funds; requiring access to 
pertinent records as needed to determine compliance; and sharing 
information with the public regarding protections against 
discrimination. As with all of its investigations, including compliance 
reviews, OCR acts as a neutral factfinder and does not presume 
discrimination by the covered entity.
---------------------------------------------------------------------------

    \396\ 29 FR 16298, 16301-03 (Dec. 4, 1964).
---------------------------------------------------------------------------

    Comment: Some commenters recommended that OCR consider creating a 
searchable database of complaints and provide status updates that 
clearly indicate where in the process a complaint stands. Commenters 
also noted that OCR should shorten the time between filing a complaint 
and resolution. They noted that lengthy timelines for resolution have 
been detrimental, as advocates are reluctant to file knowing the 
duration of an investigation, and covered entities feel less urgency to 
comply. Some commenters noted that an ongoing deterrent to filing 
administrative complaints with OCR is the lack of a mandatory response 
deadline from OCR in title VI procedures. These commenters recommended 
implementing a 90-day deadline for OCR to resolve most section 1557 
complaints, and a 120-day deadline for ``more involved'' section 1557 
complaints.
    Response: OCR appreciates commenters' recommendation to create a 
searchable database of complaints, and will take that under advisement, 
though we cannot commit to doing so at this time. OCR works with finite 
resources to address complaints as quickly and efficiently as possible 
and will continue to do so. Title VI procedures require a prompt 
investigation whenever information indicates possible noncompliance. 
OCR intends to follow these enforcement procedures and promptly address 
and resolve outstanding compliance failures. Because each potentially 
discriminatory action involves unique facts and circumstances that must 
be independently investigated on a case-by-case basis before OCR can 
determine whether a challenged action is considered discriminatory, we 
decline to add a mandatory response deadline as requested by 
commenters.
    Comment: One commenter recommended that OCR create a separate 
portal for complaints related to obstetric violence and obstetric 
racism.
    Response: OCR currently uses one portal for all civil rights 
complaints. The portal allows complainants to select the ground(s) 
under which they believe they were discriminated against to help ensure 
their complaints are fully reviewed and considered by OCR.
    Comment: Some commenters suggested merging proposed Sec. Sec.  
92.303 and 92.304 to help reduce confusion among complainants.
    Response: While we appreciate the need to have clarity when filing 
complaints, maintaining two separate sections is necessary given that 
there are different procedures for OCR to follow depending on whether 
the complaint is against the Department itself, or a recipient or State 
Exchange. However, for the sake of additional clarity, OCR will revise 
Sec.  92.303(a) to parallel Sec.  92.304,
    Comment: Some commenters recommended OCR include a provision in 
Sec.  92.303 expressly stating that if OCR does not have jurisdiction 
over a complaint, it will refer it to the appropriate office or agency.
    Response: Section 92.304 adopts the compliance procedures found in 
OCR's federally conducted section 504 implementing regulation, which 
includes a provision requiring OCR to make reasonable efforts to refer 
a complaint over which it does not have jurisdiction to the appropriate 
Federal Government agency. 45 CFR 85.61(e). There is no corresponding 
provision in the title VI procedures, which are adopted at Sec.  92.303 
and are applicable to recipients and State Exchanges. However, OCR's 
practice is to refer such complaints, and we believe this is important 
to reflect this in regulatory text. We have included a new provision, 
replacing the former age-discrimination related provision at proposed 
Sec.  92.303(b), that reads: ``If OCR receives a complaint over which 
it does not have jurisdiction, it shall promptly notify the complainant 
and shall make reasonable efforts to refer the complaint to the 
appropriate Federal Government entity.''
    A Comment: Some commenters recommended that any enforcement 
mechanism include monitoring, reporting, and ``actual penalties'' or 
fines.
    Response: We appreciate the need for strong enforcement mechanisms 
to ensure compliance with section 1557. The enforcement mechanisms 
incorporated into the rule allow for investigations based on both 
complaints and OCR-initiated compliance reviews. Voluntary Resolution 
Agreements and Settlement Agreements resulting from investigations 
generally include a monitoring period and reporting requirement to 
ensure ongoing compliance. If a recipient or State Exchange does not 
come into voluntary compliance and is found in violation of section 
1557, OCR can take compliance action by either initiating fund 
termination proceedings under 45 CFR 80.8 or by any other means 
authorized by law, including referral to DOJ for enforcement 
proceedings.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, we are finalizing the provisions as proposed in 
Sec.  92.303, with modifications. We are revising Sec.  92.303(a) to 
read ``. . . administrative enforcement actions concerning 
discrimination on the basis of race, color, national origin, sex, age, 
disability, or any combination thereof . . .'' This language applies 
the same procedural provisions to administrative enforcement actions 
under section 1557

[[Page 37664]]

regardless of the basis of alleged discrimination, acknowledges that 
discrimination experienced by individuals may involve multiple bases, 
and corrects a scrivener's error (an unnecessary placement of the word 
``discrimination'' after ``disability''). We are also revising Sec.  
92.303(a) to parallel Sec.  92.304, to now provide that the procedural 
provisions applicable to title VI apply with respect to administrative 
enforcement actions against health programs and activities of 
recipients and State Exchanges concerning discrimination on the basis 
of race, color, national origin, sex, age, and disability 
discrimination under section 1557 or the part. These procedures are 
found at 45 CFR 80.6 through 80.11 and part 81 of the subchapter. 
Additionally, we are replacing the text at proposed Sec.  92.303(b) 
with new language stating: ``If OCR receives a complaint over which it 
does not have jurisdiction, it shall promptly notify the complainant 
and shall make reasonable efforts to refer the complaint to the 
appropriate Federal Government entity.''
Procedures for Health Programs and Activities Administered by the 
Department (Sec.  92.304)
    In Sec.  92.304, OCR addressed procedures for all claims of 
discrimination against the Department under section 1557 or the part, 
as set forth in Sec.  92.304(a).
    Section 92.304(b) proposed making the existing procedures under the 
section 504 federally conducted regulation at 45 CFR 85.61 and 85.62 
applicable to all such claims under Section 1557 for all protected 
bases (i.e., race, color, national origin, sex, age, and disability).
    Section 92.304(c) proposed requiring the Department to provide OCR 
access to information relevant to determining compliance with section 
1557 or the part.
    Section 92.304(d) proposed prohibiting the Department from 
retaliating against an individual or entity for the purpose of 
interfering with any right secured by section 1557 or the part, or 
because such individual or entity has participated in an investigation, 
proceeding, or hearing under section 1557 or the part.
    The comments and our responses regarding Sec.  92.304 are set forth 
below.
    Comment: Some commenters recommended that this section explicitly 
recognize claims of discrimination involving multiple bases, and 
suggested amending Sec.  92.304(a) to add ``or a combination thereof.'' 
Some commenters recommended providing clear procedures for the 
administrative enforcement of such intersectional claims.
    Response: OCR agrees that including this language is consistent 
with the changes we have made throughout the text regarding claims of 
discrimination involving multiple bases and accepts this proposal with 
a minor modification, so that the rule reads ``of any combination 
thereof.'' Further, OCR appreciates the recommendation for providing 
clear procedures for the administrative enforcement of intersectional 
claims. As stated in Sec.  92.301, administrative complaints under 
section 1557 alleging multiple grounds of discrimination are now 
subject to a single administrative process.
    Comment: Commenters on Sec.  92.304(d) supported its prohibition on 
retaliation by the Department, noting that this provision shows a 
commitment to preventing discrimination at all levels and ensuring a 
path to rectifying grievances.
    Response: OCR appreciates the support for this provision and, as 
stated in the preamble, we think it is important to include because 
individuals should not face retaliation for asserting their civil 
rights or raising concerns regarding discrimination being experienced 
by others.
    Comment: Some commenters encouraged OCR to be as proactive as 
possible in enforcing the regulations with respect to the Department's 
programs.
    Response: OCR appreciates the need for proactive enforcement and 
proactive technical assistance. We will continue working with the 
Department components in providing technical assistance and assisting 
them in helping to resolve compliance issues with section 1557.
Summary of Regulatory Changes
    For the reasons set forth in the Proposed Rule and considering the 
comments received, OCR is finalizing the provisions as proposed in 
Sec.  92.304, with modification. We are revising Sec.  92.304(a) and 
(b) to read ``. . . discrimination on the basis of race, color, 
national origin, sex, age, disability, or any combination thereof . . . 
,'' consistent with edits made at Sec. Sec.  92.101(a)(1), 92.207(a) 
and (b)(1) and (2), and 92.303(a). In addition, as noted above, for 
clarity, we are revising Sec.  92.304(b) to parallel Sec.  92.303 to 
now provide that the procedural provisions applicable to section 504 at 
45 CFR 85.61 and 85.62 shall apply with respect to administrative 
enforcement actions against the Department, including Federally-
facilitated Exchanges, concerning discrimination on the basis of race, 
color, national origin, sex, age, or disability under section 1557 or 
the part. Also, where the section cross-references regulatory 
provisions that use the term ``handicap,'' the term ``race, color, 
national origin, sex, age, or disability'' shall apply in its place.

III. Change in Interpretation--Medicare Part B Funding Meets the 
Definition of Federal Financial Assistance; Responses to Public Comment

    The Department's longstanding position has been that Medicare Part 
B (``Part B'') funding does not meet the definition of ``Federal 
financial assistance'' for the purpose of title VI, title IX, section 
504, the Age Act, and section 1557. See, e.g., 81 FR 31375, 31383 (May 
18, 2016). In the 2022 NPRM, we proposed to change that position after 
evaluating the Part B program and the definition of ``Federal financial 
assistance'', such that Part B funds will be considered Federal 
financial assistance when received by providers and suppliers.
    The Department sought comment on the impact that this change in 
position may have on recipients subsidized only by Part B funds that do 
not receive any other form of Federal financial assistance from the 
Department. We also invited comment on the amount of time that should 
be allowed for recipients of Part B funds to come into compliance with 
the applicable statutes and their implementing regulations. We also 
sought comment on what resources the Department can provide to assist 
newly covered entities in coming into compliance.
    The comments and our responses regarding this change in 
interpretation are set forth below.
    Comment: Some commenters objected to the proposal. These commenters 
claimed that interpreting Part B as meeting the definition of ``Federal 
financial assistance'' would reduce access to care because forcing 
these providers to implement new requirements will discourage them from 
participating in federally funded health care programs. Other 
commenters who opposed this interpretation stated that Part B does not 
meet the definition of ``Federal financial assistance'' because the 
program requires participants to pay monthly premiums based on income. 
In this way, commenters maintained, Part B is merely a private health 
insurance plan for individuals with low incomes, and is not equivalent 
to a Federal welfare program. A few commenters discussed that including 
Part B among the programs to which section 1557 applies is a radical 
change to what

[[Page 37665]]

qualifies as Federal financial assistance, and that such a change will 
affect other civil rights laws.
    Response: The Department's change in interpretation regarding Part 
B does not alter, change, or expand the definition of ``Federal 
financial assistance.'' As stated in the 2022 NPRM, the Department is 
revising its position regarding whether Part B payments constitute 
Federal financial assistance under the longstanding definition of 
``Federal financial assistance'' in regulations implementing section 
1557 and the four statutes referenced in section 1557: title VI, title 
IX, section 504, and the Age Discrimination Act. 87 FR 47828. After 
evaluating the definition of ``Federal financial assistance,'' the 
Department has concluded that Part B funds meet that definition. While 
we disagree that this change in interpretation changes the definition 
of ``Federal financial assistance,'' we do note that this change means 
that Part B payments are considered Federal financial assistance with 
respect to title VI, title IX, section 504, and the Age Discrimination 
Act, in addition to section 1557.
    Moreover, the Department disagrees that Part B is the equivalent of 
private health insurance and therefore is not Federal financial 
assistance. Part B confers a benefit or subsidy on the recipient--
namely, financial assistance to the provider in exchange for providing 
health care services. As discussed in the 2022 NPRM, ``the government 
is assisting providers of services by making available to them a 
segment of the patient population that either (a) would not have been 
able to afford any medical services, or (b) would not have been able to 
afford these specific providers.'' 87 FR 47890. The Federal Government, 
through Part B, offers providers a reliable source of payment for 
services given to eligible patients who otherwise would go without 
care. Although Part B enrollees may pay premiums to receive coverage, 
the Federal Government covers half of the cost of Part B benefits. 
Thus, the fact that enrollees may pay for a portion of their coverage 
does not change the fact that providers receive Federal financial 
assistance through the program. In this way, Part B is no different 
than Medicare Part A, which also offers financial assistance to 
providers and which has long been considered Federal financial 
assistance. We note, however, that private health insurance may be 
subject to this rule when a health insurance issuer receives Federal 
financial assistance for such coverage. For instance, issuers may 
receive Federal financial assistance through receipt of advance 
payments of the premium tax credit or cost-sharing reductions for 
qualified health plans, which are private health insurance plans sold 
on the Exchanges. Further, when a recipient health insurance issuer is 
principally engaged in the provision or administration of health 
insurance coverage or other health-related coverage as set forth under 
the definition of ``health program or activity'' at Sec.  92.4, all of 
the issuer's operations are covered, including its other private health 
insurance coverage, such as coverage sold off the Exchange.
    OCR is also unpersuaded by the argument that the Department's 
change in interpretation will reduce access to care by leading to 
physician disenrollment from Medicare participation or decreased 
participation in other federally funded government programs. Indeed, we 
are unaware of any evidence that supports this concern and commenters 
did not provide any. As stated in the 2022 NPRM, many providers who 
receive payments through Part B are already subject to section 1557 and 
the four civil rights laws referenced in section 1557 through receipt 
of other Federal financial assistance. 87 FR 47890.
    For the reasons provided in the NPRM and restated here, the 
Department respectfully disagrees with commenters and reiterates its 
position that funds provided via the current Part B program meet the 
longstanding definition of ``Federal financial assistance''.
    Comment: An overwhelming number of commenters supported the change 
in interpretation, the result of which is that the Part B funds will be 
considered Federal financial assistance. Many groups commented that 
applying section 1557 to Part B will help address past discrimination. 
For example, commenters discussed that excluding Part B from a Federal 
financial assistance designation exempted individual providers from any 
obligation to comply with the Civil Rights Act of 1964. This exemption 
of the Part B program from title VI's nondiscrimination requirements 
allowed doctors in many states to continue providing segregated health 
care services. Commenters stated that failing to consider Part B 
payments as Federal financial assistance created confusion for patients 
about whether civil rights laws applied to their individual health 
providers--many of whom refused to serve individuals on the basis of 
their race or national origin because title VI did not apply to them. 
Therefore, commenters suggested that discriminatory history warrants 
the Department's reassessment of whether Part B payments meet the 
definition of ``Federal financial assistance''. They also note that 
this change will align Part B with other portions of the Medicare 
program and bring uniformity across all Medicare providers, increasing 
access to quality health care.
    Other commenters explained that many of Part B providers already 
receive other forms of Federal financial assistance, such that this 
change in interpretation will not subject them to new obligations. Some 
commenters stated that all providers enrolled in the Part B program are 
recipients of Federal financial assistance--regardless of whether they 
are ``participating'' or ``non-participating'' providers--because even 
those designated as ``non-participating'' agree to provide Medicare-
subsidized health services to Part B enrollees.
    Many other supportive commenters noted that because funds received 
under Medicare Part A and Part B are fundamentally similar and Medicare 
Part A payments have long been considered Federal financial assistance, 
it is reasonable for the Department to similarly consider Part B 
payments as Federal financial assistance. Therefore, the commenters 
argue, considering Part B payments to be Federal financial assistance 
will allow individuals additional options for bringing discrimination 
claims against discriminatory conduct in all health care settings.
    Response: OCR appreciates commenters' views on the Department's 
change in interpretation regarding whether Part B payments constitute 
Federal financial assistance as defined by our civil rights 
regulations. The Department agrees with commenters that because Part B 
payments, like those of Medicare Part A, are Federal funds directly or 
indirectly received by providers, they squarely meet the definition of 
``Federal financial assistance''. This position provides uniformity 
across the Medicare programs and will not only help address patient 
confusion regarding the funding streams of their respective Medicare 
programs, but also ensures that the Department is applying the 
definition of ``Federal financial assistance'' consistently across all 
of our federally funded programs.
    The Department agrees that because many recipients of Part B funds 
are already recipients of some other form of Federal financial 
assistance, this change will not impose excessive burdens on those 
covered entities. For those newly covered entities, however, we are 
providing a delayed applicability date as discussed below.

[[Page 37666]]

    Comment: Many other commenters expressed the view that this change 
in position by the Department reflects the evolution of how the Part B 
program operates today. Commenters explained that while Part B once 
served as contracts of insurance for those who qualified, today, 
individual providers directly bill and receive payment from the Federal 
Government itself.
    Response: The Department acknowledges commenters' point that the 
current manner in which the Part B program is administered is a factor 
in our changed view on whether Part B funds meet the definition of 
``Federal financial assistance''. As the commenters noted, a majority 
(\2/3\) of providers enrolled in Part B bill and are paid directly by 
the Medicare program. 87 FR 47889. However, this is not solely 
determinative regarding the change in interpretation. As noted in the 
2022 NPRM, under Grove City College v. Bell, 465 U.S. 555, 569 (1984), 
Federal funds are Federal financial assistance regardless of whether 
they are provided directly by the Federal Government to an entity or 
are provided initially to beneficiaries (i.e., program participants) 
for the specified purpose of assisting with payment for services.
    Comment: Several commenters stated that this change in position 
will increase equity in access to quality health care for individuals 
with LEP, immigrants, and communities of color, as these groups are 
more likely to participate in Part B. Other commenters expressed the 
view that this interpretation allows the Department to align Part B 
providers' nondiscrimination obligations to Medicare Part A, which will 
result in better care for individuals with disabilities and will 
eliminate confusion for older adults who cannot determine whether their 
Part B provider receives any other type of Federal financial 
assistance. Other commenters stated that this will offer significant 
relief for older patients, individuals with disabilities, and LGBTQI+ 
adults by providing the same protections and rights regardless of the 
nature of the Medicare provider or the service they are receiving. 
These patients will no longer have to determine whether they are 
eligible for both Medicare and Medicaid, or whether they have Medicare 
or Medicaid, in order to assess what nondiscrimination protections they 
are afforded. A few commenters expressed the view that this will be 
particularly helpful for enrollees who rely on small specialty 
providers for care, such as medical equipment suppliers, that receive 
only Part B and no other form of Federal financial assistance. Several 
other commenters also explained that because many Medicare providers 
also serve people with other forms of health coverage, including 
private insurance, this change will increase access to quality health 
care for underserved communities who face disproportionate 
discrimination and barriers.
    Response: The Department appreciates these comments and generally 
agrees that bringing all Medicare programs in line with other Federal 
financial assistance programs will bring about better health outcomes 
and increase equity in access to care. This position is also supported 
by the similarities across the Medicare programs and eliminates an 
inconsistency in the application of the definition of ``Federal 
financial assistance'' that the Department has determined is no longer 
justifiable.
    Comment: A few commenters suggested that the Department should have 
a delayed date for when the revised interpretation regarding Part B 
payments as Federal financial assistance becomes effective. Some 
suggested at least 180 days and up to 365 days for newly covered 
providers to reach compliance for those practices that have not been 
subject to these requirements in the past. Several commenters stated 
that newly covered entities will need sufficient time to implement 
appropriate procedures, such as having a one-year applicability date or 
a safe-harbor compliance window of at least 6 months. However, one 
commenter expressed that the Department should impose the same 
implementation timeline for all covered entities, given that, in their 
view, very few entities will be providers who are not already Federal 
financial assistance recipients. This commenter explained that 
additional time is not necessary because OCR is also providing entities 
with technical assistance to reach compliance.
    Response: The Department appreciates commenters' concerns and has 
amended the applicability date to give newly covered recipients 
sufficient time to come into compliance with civil rights obligations, 
as described below in the ``Summary of Changes.'' As this new 
designation of Part B applies to all Federal financial assistance-based 
civil rights statutes enforced by the Department, to the extent covered 
entities require assistance, OCR will provide adequate support.
Notice of Interpretation and Dates
    A. Notice of interpretation.
    The Department is finalizing its interpretation that Medicare Part 
B (``Part B'') funding meets the definition of ``Federal financial 
assistance'' for the purpose of title VI, title IX, section 504, the 
Age Act, and section 1557.
    B. Effective date.
    This interpretation is effective upon its publication in the 
Federal Register.
    C. Applicability date.
    The Department recognizes that that there are some recipients that 
do not receive any Federal financial assistance other than Part B funds 
and that these recipients be newly required to comply with section 1557 
and other Federal civil rights laws enforced by OCR. The Department 
acknowledges that these recipients will require time to come into 
compliance as a result of this change in position. Therefore, while 
this revised interpretation is effective upon publication in the 
Federal Register, it will have a one-year delayed applicability date. 
Thus, compliance by entities whose Federal program participation has 
been limited to Part B must be in compliance with title VI, title IX, 
section 504, the Age Act, and section 1557 no later than May 6, 2025. 
An Assurance of Compliance, as required by 45 CFR 92.5, must be filed 
with the Department by entities whose Federal program participation has 
been limited to Medicare Part B no later than May 6, 2025. This can be 
completed via OCR's Assurance of Compliance portal at https://ocrportal.hhs.gov/ocr/aoc/instruction.jsf. Similarly, if such a 
recipient accepts a form of Federal financial assistance other than 
Part B prior to May 6, 2025, they will be required to complete an 
Assurance of Compliance at that time, consistent with section 1557 and 
the other Federal civil rights laws enforced by OCR.

IV. CMS Amendments

    In the 2022 NPRM, the Department proposed clarifying CMS provisions 
that govern Medicaid and CHIP; PACE; health insurance issuers, 
including issuers providing EHB and issuers of qualified health plans 
(QHPs), and their officials, employees, agents, and representatives; 
States and the Exchanges carrying out Exchange requirements; and 
agents, brokers, or web-brokers that assist with or facilitate 
enrollment of qualified individuals, qualified employers, or qualified 
employees into Exchange coverage so that they again identify and 
recognize discrimination on the basis of sexual orientation and gender 
identity as prohibited forms of discrimination based on sex. The 
Department sought comments on CMS' proposal to explicitly mention only 
gender identity and sexual orientation in its amendments, while 
understanding that

[[Page 37667]]

discrimination on the basis of sex stereotypes, sex characteristics, 
and pregnancy or related conditions is also prohibited sex 
discrimination.
    We are clarifying and emphasizing our intent that if any provision 
of this final rule is held to be invalid or unenforceable by its terms, 
or as applied to any person or circumstance, or stayed pending further 
action, it shall be severable from this final rule, and from rules and 
regulations currently in effect, and not affect the remainder thereof 
or the application of the provision to other persons not similarly 
situated or to other, dissimilar circumstances. Through this rule, we 
adopt provisions that are intended to and will operate independently of 
each other, even if each serves the same general purpose or policy 
goal. Where a provision is necessarily dependent on another, the 
context generally makes that clear.
    Comment: The majority of commenters on the proposed CMS amendments 
in the 2022 NPRM supported the proposal to explicitly identify and 
recognize discrimination on the basis of sexual orientation and gender 
identity as prohibited types of sex discrimination. However, many of 
the commenters noted that the language in the CMS amendments did not 
match the language explaining what constitutes sex discrimination in 
the proposed section 1557 implementing regulation (proposed 45 CFR 
92.101(a)(2)). Commenters encouraged the agency to adopt the language 
in proposed Sec.  92.101(a)(2). Specifically, those commenters 
suggested that the CMS amendments should revise the term ``sex'' to 
``sex (including discrimination on the basis of sex characteristics, 
including intersex traits; pregnancy or related conditions; sexual 
orientation; gender identity; transgender status; and sex 
stereotypes)'' rather than ``sex (including sexual orientation and 
gender identity)'' as proposed for the various CMS regulations. 
Commenters argued that adopting the language from Sec.  92.101(a)(2) in 
the CMS amendments would avoid confusion and ensure consistency of 
implementation and enforcement among the nondiscrimination protections 
in the CMS amendments and section 1557. In many contexts, CMS program 
regulations are more visible to some providers, patients, patient 
advocates, and other stakeholders than section 1557 requirements and 
are more readily translated into institutional policy, training, and 
patient awareness. Commenters asserted that the Department having a 
consistent description of sex discrimination would improve consistency 
across Department regulations, further the health and safety of program 
beneficiaries, and protect them from discrimination in health care. One 
commenter emphasized that a statement in the 2022 NPRM that CMS 
understands that discrimination on the basis of sex stereotypes, sex 
characteristics, and pregnancy or related conditions is prohibited sex 
discrimination, without the inclusion of such language in the 
regulatory text, provides inadequate notice to entities required to 
comply with the CMS amendments.
    Response: The Department is finalizing the proposed amendments to 
the CMS regulations, with a revision to the description of sex 
discrimination to conform to the language in 45 CFR 92.101(a)(2). We 
appreciate that so many commenters made this suggestion and raised 
important issues concerning avoiding confusion, ensuring consistent 
implementation, and providing greater clarity for compliance and 
enforcement. In the Proposed Rule, CMS noted in the preamble that it 
understands that sex discrimination includes discrimination based on 
sex stereotypes, sex characteristics, including intersex traits, and 
pregnancy or related conditions, but limited the explicit mention in 
the regulatory text to gender identity and sexual orientation, sought 
comments. 87 FR 47891. The Department agrees with commenters that the 
amendments in the regulation should reflect CMS' intended 
interpretation of sex discrimination to avoid confusion for regulated 
entities and to better address the barriers to obtaining health care, 
including those faced by LGBTQI+ people, that CMS noted in the Proposed 
Rule. As there are entities that must comply with both CMS 
nondiscrimination provisions and section 1557, adopting identical 
language will ensure consistency across the policies and requirements 
applicable to entities subject to all of the provisions. As finalized, 
these CMS regulations provide that discrimination based on ``sex'' 
includes discrimination based on sex characteristics, including 
intersex traits; pregnancy or related conditions; sexual orientation; 
gender identity; and sex stereotypes. The list in the regulation text 
is not an exhaustive one that outlines all the ways (or the only ways) 
that discrimination can be based on sex but, rather, it only identifies 
examples; CMS interprets these regulations accordingly. However, 
nothing in this rule impedes regulated entities from taking 
nondiscriminatory actions based on current medical standards and 
evidence, such as individualized and nondiscriminatory decisions based 
on current medical standards and evidence about the timing or type of 
protocols appropriate for care. The rule does not (and cannot) require 
a specific standard of care or course of treatment for any individual, 
minor or adult.
    Summaries of regulatory changes are outlined below, along with 
responses to comments. In the following sections, for brevity, all 
references to ``sex discrimination'' or ``discrimination on the basis 
of sex'' mean ``discrimination based on sex (including discrimination 
on the basis of sex characteristics, including intersex traits; 
pregnancy or related conditions; sexual orientation; gender identity, 
including transgender status; and sex stereotypes).''

A. Medicaid and Children's Health Insurance Program (CHIP)

    In 42 CFR 438.3(d)(4) and 438.206(c)(2) (which apply to CHIP 
managed care through existing cross-references in Sec. Sec.  
457.1201(d) and 457.1230(a)), we proposed to restore regulatory text to 
prohibit Medicaid and CHIP managed care plans, which include managed 
care organizations, prepaid inpatient health plans, prepaid ambulatory 
health plans, primary care case managers, and primary care case 
management entities in managed care programs, from discriminating on 
the basis of sexual orientation and gender identity, and to require 
managed care plans to promote access and delivery of services in a 
culturally competent manner to all beneficiaries regardless of sexual 
orientation or gender identity. Such text was finalized as part of 
Sec. Sec.  438.3(d) and 438.206(c)(2) in the Medicaid and CHIP managed 
care final rule published in the Federal Register on May 6, 2016 (2016 
Medicaid and CHIP Rule), 81 FR 27498, but was removed as part of the 
Department's second section 1557 rulemaking (2020 Rule), 85 FR 37160, 
37219-37220.
    Similarly, in 42 CFR 440.262, for fee-for-service Medicaid 
programs, we proposed to restore regulatory text to require States to 
promote access and delivery of services in a culturally competent 
manner to all beneficiaries regardless of sex, including sexual 
orientation or gender identity. Again, the text was finalized as part 
of Sec.  440.262 in the 2016 Medicaid and CHIP Rule but the references 
to sexual orientation and gender identity were removed by the 2020 
Rule. We also proposed to change ``unique'' in 42 CFR 440.262 to 
``individualized'' to more accurately reflect Medicaid's goal of 
providing person-centered care. Finally, we proposed to incorporate 42 
CFR 440.262 into CHIP regulations through a cross-reference at 42 CFR 
457.495(e),

[[Page 37668]]

ensuring alignment across fee-for-service Medicaid and CHIP programs.
    The comments received on these proposals and our responses are set 
forth below.
    Comment: We received many comments in support of the reinstatement 
of prohibitions against discrimination based on sexual orientation and 
gender identity in Medicaid and CHIP. Commenters stated that restoring 
the regulation text at 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 
(and therefore in Sec. Sec.  457.1201(d) and 457.1230(a)) would promote 
access to care and the delivery of services in a culturally competent 
manner, strengthen the Department's commitment to increasing equity, 
and address discrimination in health programs and activities that can 
lead to disparate health outcomes.
    Response: We appreciate the support for our proposals and believe 
finalizing revisions to these provisions will be an essential step in 
promoting culturally competent care that improves access, quality of 
care, and ultimately health outcomes.
    Comment: One commenter that asked CMS to adopt the more detailed 
description of ``sex discrimination'' in proposed Sec.  92.101(a)(2) 
pointed out that CMS program rules provide different compliance 
mechanisms--including prospective as well as complaint-based 
mechanisms--that complement section 1557's fundamental but essentially 
retrospective, complaint-based enforcement scheme.
    Response: We appreciate the commenter raising this important 
perspective. There are prospective and retrospective compliance 
mechanisms reflected as State and managed care plan responsibilities in 
the Medicaid managed care regulations at 42 CFR part 438. Some 
provisions explicitly address requirements that must be included in 
managed care plan contracts and others stipulate State 
responsibilities. A provision that particularly reflects State 
responsibilities for proactively monitoring their managed care programs 
to ensure compliance with Federal regulations is 42 CFR 438.66, which 
requires States to have a monitoring system for all Medicaid managed 
care programs that addresses all aspects of the program including the 
performance of each managed care plan. This provision also requires 
States to use the data collected from their monitoring activities to 
improve their program's performance. This example of a prospective and 
retrospective activity requirement demonstrates how the Medicaid 
managed care regulations may help states and their managed care 
programs complement OCR's enforcement actions related to the 
prohibition of discrimination by providing for more timely monitoring 
and enforcement of discrimination prohibitions. Consistent regulation 
text about what sex discrimination means in this context--specifically, 
it includes discrimination on the basis of sex characteristics, 
including intersex traits; pregnancy or related conditions; sexual 
orientation; gender identity; and sex stereotypes--will maximize the 
effect of these benefits.
    In addition, we believe it is critical to ensure consistency in the 
application of nondiscrimination requirements between Medicaid managed 
care and fee-for-service programs. Under section 1902(a)(19) of the 
Social Security Act, states must provide for such safeguards as may be 
necessary to assure access to care and services in a manner consistent 
with simplicity of administration and the best interest of 
beneficiaries. A Medicaid fee-for-service regulation (at 42 CFR 
440.262) clarifying the meaning of the term ``sex'' in this context, 
particularly when that regulation is consistent with 42 CFR 438.3(d)(4) 
and 438.206(c)(2) facilitates simplicity in administration of 
nondiscrimination requirements and ensures the best interests of the 
beneficiaries are met across Medicaid delivery systems for all Medicaid 
beneficiaries. As we noted in the NPRM, the best interest of 
beneficiaries is appropriately met when access to care and services are 
provided in a non-discriminatory manner. A consistent approach on this 
issue will help protect beneficiaries from discrimination, avoid 
confusion, and provide for simplicity in administration of State 
Medicaid programs. To this end, we believe the reference to ``sex'' at 
42 CFR 440.262 should be consistent with 42 CFR 438.3(d)(4) and 
438.206(c)(2).
    For this reason and those stated above, we are finalizing the 
proposed amendments to 42 CFR 438.3(d)(4), 438.206(c)(2), and 440.262 
with revisions to make the discussions of ``sex'' in them consistent 
with 45 CFR 92.101(a)(2). In 42 CFR 438.3(d)(4) (and therefore Sec.  
457.1201(d)), we also are finalizing revisions to improve the 
readability of the provision by replacing some of the commas with 
semicolons and moving ``disability'' after ``national origin.'' We have 
also removed unnecessary parentheses in 42 CFR 438.3(d)(4), 
438.206(c)(2), and 440.262.
    Comment: One commenter asserted that the Department based the 
Proposed Rule on general provisions of the Social Security Act 
requiring that health assistance be provided in the ``best interest of 
beneficiaries'' (for Medicaid programs) and that the statute cited by 
the Department does not indicate Congressional intent related to 
prohibiting discrimination.
    Response: The Department undertook this rulemaking to better align 
the section 1557 regulation with the statutory text of 42 U.S.C. 18116, 
to reflect recent developments in civil rights case law, and to better 
address issues of discrimination that contribute to negative health 
interactions and outcomes. We believe aligning the Medicaid and CHIP 
regulations in 42 CFR parts 438, 440, and 457, subpart L, with the 
section 1557 regulations is critical to fulfilling the Department's 
mission of pursuing health equity and protecting public health. Access 
to health care that is free from discrimination benefits all 
communities and people, and is also vital to addressing public health 
emergencies, such as the COVID-19 pandemic.
    CMS possesses statutory authority under section 1902(a)(4) of the 
SSA (codified at 42 U.S.C. 1396a(a)(4)), which authorizes the Secretary 
to adopt methods of administration necessary for the proper and 
efficient operation of the Medicaid State plan; section 1902(a)(19) of 
the SSA (codified at 42 U.S.C. 1396a(a)(19)), which requires the 
Medicaid State plan to provide safeguards as necessary to assure that 
covered services are provided in a manner consistent with the best 
interests of the recipients; and section 2101(a) of the SSA (codified 
at 42 U.S.C. 1397aa(a)), which permits provision of funds to States to 
enable them to initiate and expand the provision of child health 
assistance to uninsured, low income children in an effective and 
efficient manner. CMS interprets section 1902(a)(19) of the SSA as 
prohibiting discrimination in the delivery of services because such 
discrimination is inconsistent with the best interests of the Medicaid 
beneficiaries who are eligible for and receive services. CMS interprets 
sections 1902(a)(4) and 2101(a) of the SSA as authorizing CMS to adopt 
regulations prohibiting discrimination on the basis of sex because such 
prohibitions on discrimination are necessary for the proper and 
efficient operation of a State plan, are in the best interest of 
beneficiaries, and enable states to provide child health assistance in 
an effective and efficient manner. For these reasons, we disagree with 
the commenter and continue to assert that adopting protection against 
discrimination to address disparities and, ultimately, health outcomes 
is within the authority granted to CMS by the Act.

[[Page 37669]]

    Comment: One commenter stated that the proposed regulation text 
would prohibit physicians or other health professionals from 
categorically declining to provide gender-affirming treatments due to 
their religious or moral beliefs guaranteed them under the First 
Amendment to the U.S. Constitution and could require them to provide 
services and treatment procedures related to gender-affirming care that 
they object to performing.
    Response: These regulations do not require the provision of any 
specific services. These regulations are neutral, generally applicable, 
and do not violate the Free Exercise Clause of the First Amendment. 
These regulations do not target religiously motivated conduct, but 
rather, are intended to prohibit sex discrimination generally in order 
to improve health outcomes for the LGBTQI+ community and fulfill the 
statutory command of the ACA to prohibit discrimination and remove 
unreasonable barriers to care. As noted previously in this rule, 
conduct does not constitute a violation of this rule's prohibition on 
sex discrimination if there is a legitimate, nondiscriminatory reason 
for the action. Also, HHS will respect religious freedom and conscience 
protections in Federal law, particularly with regard to the provision 
of certain health-related services. For example, when enforcing its 
nondiscrimination regulations, HHS will comply with laws protecting the 
exercise of conscience and religion, including RFRA (42 U.S.C. 2000bb 
through 2000bb-4) and all other applicable legal requirements. Nothing 
in the nondiscrimination protections at 42 CFR 438.3(d)(4), 
438.206(c)(2), and 440.262 (which apply to CHIP managed care through 
existing cross-references in Sec. Sec.  457.1201(d) and 457.1230(a) and 
CHIP fee-for-service through a new cross-reference at Sec.  
457.495(e)), displaces those protections. In enforcing the 
nondiscrimination provisions in the corresponding CMS regulations, the 
Department will comply with laws protecting the exercise of conscience 
and religion, including the Religious Freedom Restoration Act (42 
U.S.C. 2000bb through 2000bb-4) and all other applicable legal 
requirements. Finally, we note that physician licensing and discipline 
are outside the scope of this rulemaking.
Summary of Regulatory Changes
    After consideration of the public comments, we are finalizing 42 
CFR 438.3(d)(4), 438.206(c)(2), and 440.262 (which apply to CHIP 
managed care through existing cross-references in Sec. Sec.  
457.1201(d) and 457.1230(a)) with revisions to specify that 
discrimination based on ``sex'' includes discrimination on the basis of 
sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes. 
Similarly, where these regulations require actions to be taken 
regardless of sex, that includes actions regardless of sex 
characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes. 
We are also finalizing the change of ``unique'' to ``individualized'' 
in 42 CFR 440.262 as proposed.

B. Programs of All-Inclusive Care for the Elderly (PACE)

    In 42 CFR 460.98(b)(3), CMS proposed to add sexual orientation and 
gender identity to the list of characteristics that may not serve as a 
basis for discrimination against a PACE participant. Additionally, in 
42 CFR 460.112, we proposed to add gender identity to the list of 
characteristics that may not serve as a basis for discrimination 
against a PACE participant. This PACE provision is applicable one year 
after the effective date of this final rule.
    Comment: CMS received numerous comments supporting our changes to 
both provisions.
    Response: CMS thanks the commenters for supporting these important 
changes that will serve to protect CMS' beneficiaries.
    Comment: Several commenters did not support CMS' proposal to add 
sexual orientation and gender identity to the list of characteristics 
that may not serve as a basis for discrimination against a PACE 
participant. Some commenters objected to the protections against 
discrimination on the basis of gender identity, in particular. Some 
commenters, believing that the proposal requires coverage of gender-
affirming care, stated that the Department can adequately protect 
people from discrimination without mandating this coverage.
    Response: This rule does not require entities to cover any 
particular procedure or treatment. We clarify that, in finalizing the 
prohibition against discrimination on the basis of sex, the Department 
is not mandating that PACE organizations include coverage for any 
particular item or service not already covered. Rather, amending these 
sections to clarify discrimination on the basis of sex as including sex 
characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes 
will better ensure that all individuals are treated fairly in their 
access to health care. Without protection from such sex discrimination, 
transgender individuals may face barriers or be denied medically 
necessary services that are classified as covered under PACE and made 
available to other enrolled individuals. These amendments will better 
clarify nondiscrimination protections for all individuals, while also 
addressing existing disparities for LGBTQI+ individuals seeking health 
care. For the reasons discussed here and in the preamble to the 
Proposed Rule, CMS believes it is important to ensure all PACE 
participants are protected against unlawful discrimination of any kind, 
including discrimination based on sex characteristics, including 
intersex traits; pregnancy or related conditions; sexual orientation; 
gender identity; and sex stereotypes. Therefore, we are finalizing 
these revisions.
Summary of Regulatory Changes
    We are finalizing the regulatory language with modifications based 
on comments received. Specifically, we are revising the reference to 
sex to include additional detail explaining that the reference to 
``sex'' includes sex characteristics, including intersex traits; 
pregnancy or related conditions; sexual orientation; gender identity, 
including transgender status; and sex stereotypes.

C. Insurance Exchanges and Group and Individual Health Insurance 
Markets

    In the HHS Notice of Benefit and Payment Parameters for 2023 
Proposed Rule (2023 Payment Notice NPRM),\397\ the Department proposed 
amendments to the regulations applicable to Exchanges, QHPs, and 
certain issuers to prohibit discrimination based on sexual orientation 
and gender identity. The amendments were similar to those proposed in 
the 2022 NPRM. Those proposed amendments were not finalized in the 
Notice of Benefit and Payment Parameters for 2023 final rule published 
on May 6, 2022,\398\ because the Department determined that it would be 
most prudent to address the nondiscrimination proposals related to 
sexual orientation and gender identity in the 2022 NPRM to ensure 
consistency across the policies and requirements applicable to entities 
subject to both

[[Page 37670]]

those amendments and section 1557. 87 FR 27208. The clarifications 
finalized in this section of the rule will apply on or after the 
effective date of this final rule (60 days after publication).
---------------------------------------------------------------------------

    \397\ U.S. Dep't of Health & Hum. Servs. Ctrs. for Medicare & 
Medicaid Servs., Patient Protection and Affordable Care Act; HHS 
Notice of Benefit and Payment Parameters for 2023, 87 FR 584 
(January 5, 2022).
    \398\ U.S. Dep't of Health & Hum. Servs. Ctrs. for Medicare & 
Medicaid Servs., Patient Protection and Affordable Care Act; HHS 
Notice of Benefit and Payment Parameters for 2023, 87 FR 27208 (May 
6, 2022).
---------------------------------------------------------------------------

    In finalizing amendments to the CMS regulations in this final rule, 
the Department considered comments received in response to the 2022 
NPRM, as well as comments received to similar proposals in the 2023 
Payment Notice NPRM (collectively, the ``Proposed Rules''). The 
Department is also responding to comments we received in response to 
the Proposed Rules in this final rule. In section C.1. of this 
preamble, the Department responds to comments applicable to 45 CFR 
147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 
156.1230(b). Section C.2. provides a summary of regulatory changes for 
45 CFR 155.120(c), 155.220(j), 156.200(e), and 156.1230(b); there were 
no unique comments applicable to those sections. Comments that relate 
specifically to 45 CFR 147.104 are addressed in section C.3. of this 
preamble.
    As stated in the 2022 NPRM, if any of the provisions at 45 CFR 
147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 
156.1230(b) are held to be invalid or unenforceable by their terms, or 
as applied to any person or circumstance, such provision shall be 
considered severable from its respective section or such application 
shall be considered severable from any valid or enforceable 
applications of such provision (87 FR 47895). The determination that a 
provision is invalid or unenforceable shall not affect either the 
remainder of its section or any other sections, and the determination 
that a provision is invalid or unenforceable as applied to any 
particular person or circumstance shall not affect the application of 
the provision to other persons not similarly situated or to other 
dissimilar circumstances. In enforcing the nondiscrimination provisions 
in the corresponding CMS regulations, the Department will comply with 
laws protecting the exercise of conscience and religion, including, to 
the extent applicable, section 1303 of the ACA, the Weldon, Church, and 
Coats-Snowe amendments, the Religious Freedom Restoration Act (42 
U.S.C. 2000bb through 2000bb-4) and all other applicable legal 
requirements.
1. Comments and Responses to 45 CFR 147.104(e), 155.120(c), 155.220(j), 
156.125(b), 156.200(e), and 156.1230(b)
    The Department proposed to amend 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b) by removing the 
term ``sex'' and revising the term to read ``sex (including sexual 
orientation and gender identity).'' However, after considering all the 
public comments submitted in response to the Proposed Rules, the 
Department is finalizing a revision to the term ``sex'' and adding in 
its place the phrase ``sex (including discrimination on the basis of 
sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex 
stereotypes).'' This revision is necessary to ensure consistency across 
the policies and requirements applicable to entities subject to both 
those amendments and section 1557.
    Comment: The majority of commenters to the proposal in the 2023 
Payment Notice NPRM expressed broad support for the proposal and agreed 
that amending the CMS regulations is warranted in light of the well-
documented discrimination that LGBTQI+ individuals face in seeking 
health care and insurance coverage.
    Commenters supporting the proposal asserted that all Americans 
deserve access to affordable, high-quality health care, and that 
Federal policies and nondiscrimination protections must reinforce 
equity of care for all patients regardless of socioeconomic and 
sociodemographic characteristics and insurance coverage. Commenters 
urged the Department to finalize the proposed nondiscrimination 
protections in light of persisting trends of pervasive discrimination 
in insurance coverage. Commenters said that it is well documented that 
LGBTQI+ individuals continue to face discrimination in seeking health 
care, and that the nondiscrimination protections will help address 
barriers to health equity for LGBTQI+ individuals and aid providers in 
providing effective care.
    Many commenters supporting the proposal referred to copious bodies 
of research, including research identified in the 2022 NPRM, that 
demonstrate the many ways in which the LGBTQI+ community faces 
discrimination when seeking health care, resulting in poorer health 
outcomes. 87 FR 47833-47835 (2022). Commenters asserted that issuers 
have contributed to this discrimination by employing transgender-
specific exclusions to deny coverage for medically necessary treatment 
and that this was exacerbated by the removal of protections on the 
basis of sexual orientation and gender identity in the 2020 Rule. Many 
of these commenters also highlighted how individuals who identify as 
part of the LGBTQI+ community disproportionately face health 
disparities and are at higher risk for many conditions.
    Response: We firmly believe that clarifying the scope of sex 
discrimination can lead to improved health outcomes for LGBTQI+ 
individuals \399\ and that these protections are consistent with our 
broader aim of improving health equity. Finalizing the amendments to 
the nondiscrimination protections to explicitly prohibit discrimination 
on the basis of sex characteristics, including intersex traits; 
pregnancy or related conditions; sexual orientation; gender identity; 
and sex stereotypes is warranted to help remedy health care 
discrimination and to better address barriers to health equity for 
LGBTQI+ individuals.\400\ The revisions to 45 CFR 147.104(e), 
155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) will 
support the Department's objective of ensuring consistency against 
employing discriminatory marketing practices and benefit designs.
---------------------------------------------------------------------------

    \399\ Brian W. Ward et al., U.S. Dep't of Health & Hum. Servs., 
Ctrs. for Disease Control & Prevention, National Health Statistics 
Report: Sexual Orientation & Health Among U.S. Adults: National 
Health Interview Survey, 2013 (2014), https://www.cdc.gov/nchs/data/nhsr/nhsr077.pdfhttps://www.cdc.gov/nchs/data/nhsr/nhsr077.pdf.
    \400\ Thu T. Nguyen et al., Trends for Reported Discrimination 
in Health Care in a National Sample of Older Adults with Chronic 
Conditions, 33 J. Gen. Internal Med. 291-297 (2017), https://doi.org/10.1007/s11606-017-4209-5.
---------------------------------------------------------------------------

    Comment: Many of the commenters that supported the proposal in the 
2023 Payment Notice NPRM suggested ways in which the Department could 
further strengthen or clarify the breadth of the nondiscrimination 
protections, such as by expressly prohibiting discrimination on the 
basis of sex characteristics, including intersex traits.
    Many commenters also recommended that the Department clarify that 
gender identity discrimination includes discrimination based on gender 
expression and transgender status. Such commenters stated that entities 
often perpetuate discrimination against transgender people because of 
their gender expression or belief that they are transgender rather than 
their gender identity itself, which is often private information. These 
commenters argued that the inclusion of ``gender identity'' alone in 
nondiscrimination protections leaves room for confusion or evasion of 
legal obligations.\401\ Commenters

[[Page 37671]]

emphasized that expressly incorporating transgender status into 
Department regulations would provide additional clarity, and would 
conform the regulation to contemporary protections against 
discrimination.
---------------------------------------------------------------------------

    \401\ See U.S. Dep't of Health & Hum. Servs., FAQs About 
Affordable Care Act Implementation (Part XXVI), 6, Q5 (May 11, 
2015), https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/aca_implementation_faqs26.pdf. Section 2713 of the PHS Act 
and its implementing regulations require non-grandfathered group 
health plans and health insurance issuers offering non-grandfathered 
group or individual health insurance coverage to provide coverage 
for certain recommended preventive health services without imposing 
any cost-sharing requirements. Under this requirement, the plan or 
issuer must provide coverage, without cost sharing, for a 
recommended preventive service that is medically appropriate for the 
individual, as determined by the individual's attending provider, 
regardless of the individual's sex assigned at birth, gender 
identity, or recorded gender.
---------------------------------------------------------------------------

    Response: We agree with commenters that discrimination on the basis 
of sexual orientation and gender identity may present itself as 
discrimination on the basis of gender expression and transgender 
status, which are inextricably linked with one's gender identity. We 
believe that gender expression and transgender status are sufficiently 
addressed by the inclusion of gender identity in the description of 
discrimination based on sex that is being finalized.
    Comment: Many commenters supported the proposal as consistent with 
the overarching intent of the ACA to improve access to health coverage 
and prohibit discrimination in health care, asserting that the removal 
of protections on the basis of sexual orientation and gender identity 
in the 2020 Rule frustrates this purpose by creating barriers to 
comprehensive care. Many commenters affirmed that the Department has 
broad authority to regulate in this area under various sections of the 
ACA independent of section 1557. Specifically, commenters acknowledged 
that section 1321(a) of the ACA \402\ gives the Department broad 
rulemaking authority to regulate Exchanges and QHPs; section 1312(c) 
\403\ gives the Department authority to establish procedures for States 
to allow agents or brokers to enroll individuals and businesses in 
QHPs; section 1302(b)(4) \404\ directs the Department, in defining EHB, 
to ``take into account the health care needs of diverse segments of the 
population, including women, children, persons with disabilities, and 
other groups''; section 1311(c)(1)(A) \405\ directs the Department to 
establish criteria for QHPs to ensure that they will ``not employ 
marketing practices or benefit designs that have the effect of 
discouraging the enrollment in such plan by individuals with 
significant health needs''; and section 2792 of the PHS Act \406\ 
provides the Department with broad authority to promulgate regulations 
that may be necessary or appropriate to carry out the provisions of 
title XXVII of the PHS Act, including the guaranteed availability 
provisions in section 2702,\407\ added to the PHS Act by the ACA.
---------------------------------------------------------------------------

    \402\ 42 U.S.C. 18041(a).
    \403\ 42 U.S.C. 18032(c).
    \404\ 42 U.S.C. 18022(b)(4),
    \405\ 42 U.S.C. 13031(c)(1)(A).
    \406\ 42 U.S.C. 300gg-92
    \407\ 42 U.S.C. 300gg-1.
---------------------------------------------------------------------------

    Response: We agree with commenters that clarifying the scope of sex 
discrimination aligns with the ACA's goals of improving access to 
health insurance and removing unreasonable barriers to care. We 
reiterate that we are relying on authority from sections 1311(c)(1)(A), 
1312(e), and 1321(a)(1)(A), (B), and (D) of the ACA, as well as 
sections 2702 and 2792 of the PHS Act, to support this change. 87 FR 
584, 596.
    Comment: Some commenters objected to the protections against 
discrimination on the basis of gender identity, in particular, or 
stated that the Proposed Rule arbitrarily requires coverage of 
interventions for individuals diagnosed with gender dysphoria, but not 
for individuals seeking such procedures for other clinically indicated 
mental health conditions. Some commenters asserted the proposal is 
arbitrary and capricious because it requires issuers to provide 
coverage for a ``one-size-fits-all'' treatment to gender dysphoria that 
is unsupported by evidence. Such commenters, believing that the 
proposal requires coverage of gender-affirming care, stated that the 
Department can adequately protect people from discrimination without 
mandating this coverage.
    Response: One of the primary goals of the proposals to clarify the 
scope of sex discrimination is to address the pervasive health care 
discrimination faced by LGBTQI+ patients.\408\ When medically necessary 
treatments are categorically excluded when sought by transgender 
enrollees for purposes of gender-affirming care, but the same such 
treatments are covered for cisgender enrollees, such exclusions may 
deny transgender individuals access to coverage based on their sex. 
These types of exclusions, and other types of sex discrimination, can 
have the effect of discouraging or preventing the enrollment of LGBTQI+ 
individuals in health insurance coverage.
---------------------------------------------------------------------------

    \408\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Disease 
Control & Prevention, Nat'l Ctr. for Health Statistics, Chapter 25: 
Lesbian, Gay, Bisexual, and Transgender Health, Healthy People 2020 
(2016), https://www.cdc.gov/nchs/data/hpdata2020/HP2020MCR-C25-LGBT.pdf; Hudaisa Hafeez et al., Health Care Disparities Among 
Lesbian, Gay, Bisexual, and Transgender Youth: A Literature Review, 
9 Cureus e1184 (2017), https://doi.org/10.7759/cureus.1184; Karen I. 
Fredriksen-Goldsen et al., Health Disparities Among Lesbian, Gay, 
and Bisexual Older Adults: Results From a Population-Based Study, 
103 a.m. J. Pub. Health 1802-1809 (2013), https://doi.org/10.2105/AJPH.2012.301110; Billy A. Caceres et al., A Systematic Review of 
Cardiovascular Disease in Sexual Minorities, 107 a.m. J. Pub. Health 
e13-e21 (2017), https://doi.org/10.2105/AJPH.2016.303630.
---------------------------------------------------------------------------

    Issuers generally have discretion in designing their benefits 
packages, and this rule does not require entities to cover any 
particular procedure or treatment. We clarify that, in finalizing the 
prohibition against discrimination on the basis of sex, the Department 
is not mandating that health insurance issuers include coverage for any 
particular item or service not already covered. However, to the extent 
a covered entity provides coverage for a particular health service, the 
covered entity must provide coverage for the health service to all 
individuals in a neutral, nondiscriminatory manner consistent with this 
rule.
    Amending these sections to specify discrimination on the basis of 
sex includes sex characteristics, including intersex traits; pregnancy 
or related conditions; sexual orientation; gender identity; and sex 
stereotypes will help better ensure that all individuals are treated 
fairly in their access to health care. Without protection from such sex 
discrimination, transgender individuals may face barriers or be denied 
medically necessary services that are classified as covered under their 
plan and made available to other enrolled individuals. Regulations at 
45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 156.200(e), and 
156.1230(b) already prohibit discrimination on a variety of bases, 
including on the basis of 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. 
Amending these sections to describe sex discrimination will better 
clarify nondiscrimination protections for all individuals, while also 
addressing existing disparities for LGBTQI+ individuals seeking health 
care.
    Comment: Many commenters that objected to the proposed 
clarification suggested that coverage of gender-affirming care and any 
corresponding treatments are unsupported by clinical evidence, harmful 
to patients, and incongruent with the belief that gender is immutably 
defined by one's biological sex. For example, many commenters asserted 
that due to the lack of clinical evidence, CMS decided in 2016 not to 
issue a National Coverage Determination

[[Page 37672]]

(NCD) \409\ for coverage of gender-affirming surgery for Medicare 
beneficiaries with gender dysphoria. Many objecting commenters also 
claimed that studies that reach different conclusions (for example, any 
studies showing efficacy or safety of gender-affirming care) are 
flawed.
---------------------------------------------------------------------------

    \409\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Decision Memo for Gender Dysphoria and Gender 
Reassignment Surgery (CAG-00446N) (Aug. 30, 2016), https://www.cms.gov/medicare-coverage-database/view/ncacal-decision-memo.aspx?proposed=N&ncaid=282.
---------------------------------------------------------------------------

    Response: We believe that commenters citing the 2016 Medicare NCD 
decision are incorrectly interpreting the decision. In its final 
Decision Memorandum on the issue, CMS notes that it declined to issue 
an NCD specifically on gender-affirming surgery because the clinical 
evidence is inconclusive, specifically as it relates to the Medicare 
population (that is, generally individuals 65 or older). CMS clarifies 
that the result of the decision is not a national coverage prohibition, 
but rather a continuation of the current policy that coverage decisions 
for gender-affirming surgery will continue to be made by local Medicare 
Administrative Contractors (MACs) and Medicare Advantage (MA) plans on 
a case-by-case basis based on whether gender-affirming surgery is 
reasonable and necessary for the individual beneficiary after 
considering the individual's specific circumstances.
    Furthermore, the Medicare program did not analyze clinical evidence 
for counseling or hormone therapy treatments for gender dysphoria and 
was not making an NCD determination related to counseling, hormone 
therapy treatments, or any other potential treatment for gender 
dysphoria. Therefore, not only is the population for which the NCD 
applies distinct, but so is the scope of the NCD decision itself.
    Claims made by opposing commenters regarding assertions of patient 
harm resulting from gender-affirming care, purported lack of evidence 
demonstrating efficacy of such care, alleged differences between 
``biological sex'' and gender, and hypothetical medical scenarios are 
not germane to the proposed regulatory text acknowledging that sex 
discrimination includes discrimination on the basis of sexual 
orientation or gender identity. While claims about medical evidence and 
specific treatments may be relevant in evaluating whether a particular 
action constitutes unlawful discrimination, or whether a particular 
item or service is medically necessary, such assertions do not speak to 
the decision to clarify the scope of sex discrimination in the first 
place. We also acknowledge that there is a robust consensus in the 
medical community that gender-affirming care is safe, effective, and 
medically necessary when clinically indicated for a particular 
individual.
    The amendments made concurrent with the 2020 final rule to the 
nondiscrimination protections in 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b) were based on an 
erroneous assertion that the plain statutory meaning of ``sex'' does 
not encompass sexual orientation and gender identity, which is 
unsupported by Bostock. In addition, the 2020 amendments were based on 
the incorrect assertion that the denial of basic health care on the 
basis of gender-identity is not a widespread problem in the United 
States.
    Comment: One commenter asserted that the proposed change to the 
description of sex discrimination is arbitrary and capricious because 
the Department did not compute the costs of the impact of the rule 
against the purported benefits of the proposal.
    Response: As we explained in the 2022 NPRM and based on our 
experience with States selecting a new EHB-benchmark plan pursuant to 
45 CFR 156.111,\410\ CMS believes there will be minimal costs incurred 
based on amending these sections to clarify sex discrimination. Because 
these sections previously prohibited discrimination on the basis of 
sexual orientation and gender identity, many entities already comply 
with the prohibition on discrimination, as amended under this final 
rule. 87 FR 47898. We do not anticipate amending these sections to 
describe sex discrimination would impose substantial administrative 
costs on any regulated entities that did not subsequently revise 
nondiscrimination policies based on the 2020 Rule.\411\ On balance, we 
believe any costs are justified in light of the potentially significant 
benefits provided by protecting individuals from discrimination based 
on sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes. 
We refer readers to our cost benefit analysis in the Regulatory Impact 
Analysis of this final rule for additional discussion on the minimal 
cost impacts to plans and issuers to include nondiscrimination 
protections. 87 FR 47898.
---------------------------------------------------------------------------

    \410\ See, e.g., U.S. Dep't of Health & Hum. Servs., Ctrs. for 
Medicare & Medicaid Servs., Information on Essential Health Benefits 
(EHB) Benchmark Plans Colorado 2023 EHB- Benchmark Plan Actuarial 
Report, https://www.cms.gov/marketplace/resources/data/essential-health-benefits. Suite of Gender-affirming care benefits to treat 
gender dysphoria resulted cost estimate was 0.04 percent of the 
total allowed claims assuming utilization would be for adults.
    \411\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, (2012), https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf; Aaron 
Belkin, Caring for Our Transgender Troops--The Negligible Cost of 
Transition-Related Care, 373 New Eng. J. Med. 1089 (2015), https://www.nejm.org/doi/pdf/10.1056/NEJMp1509230?articleTools=true; Jody L. 
Herman, The Williams Inst., UCLA Sch. of Law, Costs and Benefits of 
Providing Transition-Related Health Care Coverage in Employee Health 
Benefits Plans: Findings from a Survey of Employers, p. 2, (Sept. 
2013), https://williamsinstitute.law.ucla.edu/wp-content/uploads/Herman-Cost-Benefit-of-Trans-Health-Benefits-Sept-2013.pdf; William 
V. Padula et al., Societal Implications of Health Insurance Coverage 
for Medically Necessary Services in the U.S. Transgender Population: 
A Cost-Effectiveness Analysis, 31 J. Gen. Internal Med. 394 (2015), 
https://pubmed.ncbi.nlm.nih.gov/26481647/.
---------------------------------------------------------------------------

    Comment: Some commenters objected to a perceived lack of clarity in 
the Proposed Rules. Such commenters noted that the Proposed Rules did 
not appropriately discuss the breadth of which markets would be covered 
by this proposal, questioning whether it would apply to large group 
plans, fully insured group health plans sponsored by employers, health 
insurance issuers and third party administrators of self-insured plans.
    Response: The amendments we are finalizing to the nondiscrimination 
regulations at 45 CFR 147.104(e) apply to health insurance issuers 
offering non-grandfathered group or individual health insurance 
coverage, and their officials, employees, agents, and representatives. 
The nondiscrimination amendments we are finalizing at 45 CFR 155.120(c) 
apply to States and Exchanges carrying out Exchange requirements. The 
nondiscrimination amendments we are finalizing at 45 CFR 155.220(j) 
apply to agents, brokers, or web-brokers that assist with or facilitate 
enrollment of qualified individuals, qualified employers, or qualified 
employees, in coverage in a manner that constitutes enrollment through 
an FFE, or assists individuals in applying for advance payments of the 
premium tax credit and cost-sharing reductions for QHPs sold through an 
FFE. The nondiscrimination amendments we are finalizing at 45 CFR 
156.200(e) apply to QHPs in the individual and small-group markets. 
Section 156.125(b) requires issuers providing EHB to comply with the 
requirements of 45 CFR 156.200(e), thereby extending the application to 
non-grandfathered health insurance coverage in the individual and small 
group markets that provide EHBs.

[[Page 37673]]

Lastly, the nondiscrimination protections we are finalizing at 45 CFR 
156.1230(b) apply to issuers using direct enrollment on an FFE.
    Comment: Some commenters noted concerns about how the 
nondiscrimination protections would apply to health care providers.
    Response: The amendments we are finalizing at 45 CFR 147.104(e), 
155.120(c), 155.220(j), 156.125(b), 156.200(e), and 156.1230(b) do not 
apply to health care providers.
    Comment: One commenter asked the Department to provide clarity on 
the interaction between the section 1557 requirement and the 2023 
Notice of Benefit and Payment Parameters final rule regarding non-
discriminatory benefit design and EHB.
    Response: While the requirements of section 1557 and the 
requirements imposed on EHB are separate requirements, we are 
finalizing regulatory language in this rule to make compliance easier 
for entities that are subject to both standards. As we stated in the 
2023 Notice of Benefit and Payment Parameters final rule, CMS continues 
to make refinements to our EHB nondiscrimination policy and will 
address non-discriminatory benefit design as it relates to EHB in 
future rulemaking.
    Comment: Commenters objecting to a more detailed understanding of 
sex discrimination raised several legal concerns. Commenters stated 
that the Department's reliance on Bostock v. Clayton County, 590 U.S. 
644 (2020), is inappropriate, misinterprets Bostock, and misapplies the 
case to section 1557. One commenter asserted that the rule is arbitrary 
and capricious because it inappropriately applies the title VII 
framework to health care. Other commenters stated that the proposal is 
based on a faulty interpretation of title IX. Commenters also asserted 
that although reverting the nondiscrimination sections to pre-2020 
language would allow LGBTQI+ individuals to receive ``medically 
necessary'' care, the 2020 rule enforces the plain text enacted by the 
ACA, which prohibited the discrimination on the basis of sex only.
    Other commenters cautioned that absent clear congressional 
authorization, the Department is not justified in promoting the view 
that sex or gender can be different than the sex assigned to an 
individual at birth. Other commenters asserted that the rule is 
arbitrary and capricious because it ignores that a person's sex is 
determined by biology and does not sufficiently specify what it means 
by ``sex'' and how it relates to gender dysphoria treatments.
    Response: We disagree that the proposal to include 
nondiscrimination protections is arbitrary and capricious. We are not 
relying on or applying the title VII framework to the nondiscrimination 
protections we are finalizing at 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b), nor are we relying 
on other Federal civil rights laws for statutory authority. As stated 
in the Proposed Rule, 87 FR 596, we are relying on authority from 
sections 1311(c)(1)(A), 1312(e), and 1321(a)(1)(A), (B), and (D) of the 
ACA to support the amendments at 45 CFR 155.120, 155.220, 156.200, and 
156.1230. We also rely on authority from sections 2702 and 2792 of the 
PHS Act to support the amendments to 45 CFR 147.104 and 156.125. 
Section 2792 of the PHS Act provides the HHS Secretary with broad 
rulemaking authority to issue regulations as may be necessary or 
appropriate to carry out the provisions of title XXVII of the PHS Act, 
including the guaranteed availability provision in section 2702 of the 
PHS Act, implemented at 45 CFR 147.104, and the EHB requirements in 
section 2707(a) of the PHS Act, implemented at 45 CFR 147.150 and 
156.125. 87 FR 584, 596. We made these proposals and are finalizing 
these provisions due in large part to the pervasive health and health 
care disparities faced by people who identify as part of the LGBTQI+ 
community.\412\
---------------------------------------------------------------------------

    \412\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Disease 
Control & Prevention, Nat'l Ctr. for Health Statistics, Chapter 25: 
Lesbian, Gay, Bisexual, and Transgender Health, Healthy People 2020 
(2016), https://www.cdc.gov/nchs/data/hpdata2020/HP2020MCR-C25-LGBT.pdf; Hudaisa Hafeez et al., Health Care Disparities Among 
Lesbian, Gay, Bisexual, and Transgender Youth: A Literature Review, 
9 Cureus e1184 (2017), https://doi.org/10.7759/cureus.1184; Karen I. 
Fredriksen-Goldsen et al., Health Disparities Among Lesbian, Gay, 
and Bisexual Older Adults: Results From a Population-Based Study, 
103 a.m. J. Pub. Health 1802-1809 (2013), https://doi.org/10.2105/AJPH.2012.301110; Billy A. Caceres et al., A Systematic Review of 
Cardiovascular Disease in Sexual Minorities, 107 a.m. J. Pub. Health 
e13-e21 (2017), https://doi.org/10.2105/AJPH.2016.303630.
---------------------------------------------------------------------------

    The aim of this final rule is to address the reality of many 
consumers in the health care sector and how discrimination on the basis 
of sex by entities regulated under 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b) impairs the ability 
of consumers to access or pay for quality care. We believe these 
changes are necessary to address the role of discrimination in 
perpetuating the pervasive health and health care disparities faced by 
people who identify as part of the LGBTQI+ community.
    We also disagree with commenters contesting that these 
nondiscrimination proposals inappropriately align with Bostock. In 
Bostock, the Supreme Court held that discrimination on the basis of sex 
under title VII of the Civil Rights Act of 1964 includes discrimination 
on the basis of sexual orientation and gender identity. Under Bostock's 
reasoning, laws that prohibit sex discrimination also prohibit 
discrimination on the basis of gender identity and sexual 
orientation.\413\
---------------------------------------------------------------------------

    \413\ See, e.g., Grimm v. Gloucester Cnty. Sch. Bd., 972 F.3d 
586, 616 (4th Cir. 2020), cert. denied, 141 S. Ct. 2878 (2021) 
(``Although Bostock interprets Title VII of the Civil Rights Act of 
1964, 42 U.S.C. 2000e-2(a)(1), it guides our evaluation of claims 
under Title IX''); E.O. 13988, 86 FR 7023 (2021).
---------------------------------------------------------------------------

    Furthermore, the inclusion of ``sex stereotypes'' is consistent 
with the Supreme Court's holding in Price Waterhouse v. Hopkins, 490 
U.S. 228, 250-51 (1989). The inclusion of ``pregnancy or related 
conditions'' is consistent with the Department's longstanding 
interpretation of sex discrimination under Title IX.\414\ As noted 
earlier in this preamble, the Department is finalizing these amendments 
to ensure consistency across the policies and requirements applicable 
to entities subject to health insurance market and Exchange 
requirements and those subject to section 1557. Amending CMS 
nondiscrimination protections to better specify the meaning of sex 
discrimination is imperative to advancing health equity and ensuring 
individuals are able to receive health care that is free from 
discrimination as envisioned under the ACA.
---------------------------------------------------------------------------

    \414\ See 45 CFR 86.21(c)(2) and (3); 86.40(b)(1), (4), and (5); 
86.51(b)(6); 86.57(b) through (d) (Title IX regulation); see also 
Conley v. Northwest Fla. State Coll., 145 F. Supp. 3d 1073 (N.D. 
Fla. 2015).
---------------------------------------------------------------------------

    Comment: Many commenters to the 2023 Payment Notice NPRM expressed 
concerns that the proposal infringed on the First Amendment and would 
lead to violations of the religious conscience of providers, issuers, 
brokers, agents, and religiously affiliated hospitals. Some of these 
commenters objected to the inclusion of sexual orientation or gender 
identity within nondiscrimination protections altogether. Other 
commenters asserted that it is unclear how CMS would implement RFRA 
protections in the context of the nondiscrimination protections, and 
that this lack of clarity would increase the chance of litigation. A 
few commenters asked for the final rule to include an exemption for any 
stakeholders with religious objections (including issuers,

[[Page 37674]]

plan sponsors, or individual purchasers) or to clarify whether there 
will be a process for such stakeholders to claim an exemption under 
RFRA outside of litigation. One commenter requested a process under 
which issuers or the insured can receive an up-front exemption when 
they have a religious or conscience-based objection to paying for plans 
that cover benefits to which they object as being experimental and 
harmful.
    Other commenters believed that the proposal takes the right 
approach in relation to moral and religious objections.
    Response: These regulations are neutral, generally applicable, and 
do not violate the Free Exercise Clause of the First Amendment. These 
regulations do not target religiously motivated conduct, but rather, 
are intended to prohibit sex discrimination generally in order to 
improve health outcomes and fulfill the statutory command of the ACA to 
prohibit discrimination and remove unreasonable barriers to care. 
Certain protections already exist in Federal law with respect to 
religious or moral beliefs, particularly regarding the provision of 
certain health-related services. For example, when enforcing its 
nondiscrimination regulations, HHS will comply with laws protecting the 
exercise of conscience and religion, including RFRA and all other 
applicable legal requirements. Nothing in the nondiscrimination 
protections at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 
156.200(e), and 156.1230(b) displaces those protections, and an 
application of this rule will not be required if it would violate 
Federal religious freedom and conscience laws.
    Although some commenters urged CMS to incorporate a categorical 
religious exemption into this final rule, a blanket religious exemption 
is not supported by the underlying statutes. We will apply the 
protections in existing laws in resolving any conflicts between 
religious beliefs and these nondiscrimination protections. An entity 
that believes that compliance with any of these provisions would 
violate their rights under RFRA or the Free Exercise Clause of the 
First Amendment should contact CMS, which is responsible for evaluating 
RFRA-based requests for requirements in the programs it operates or 
oversees.\415\ An entity that believes that compliance with any 
provision of this rule would violate their rights under the religious 
freedom and conscience laws enforced by HHS's Office for Civil Rights 
should file a complaint with OCR.
---------------------------------------------------------------------------

    \415\ U.S. Dep't of Health and Hum. Servs., Off. of the Sec'y, 
Delegation of Authority, 86 FR 67067 (Nov. 24, 2021).
---------------------------------------------------------------------------

    As with any HHS program, if an entity alleges that HHS's actions 
have substantially burdened its religious exercise, the Department will 
apply the test set out by RFRA.\416\ The RFRA analysis evaluates 
whether the actions of the Federal Government have substantially 
burdened an entity's exercise of religion; if so, the question becomes 
whether the action furthers a compelling interest and is the least 
restrictive means to further that interest. RFRA provides that when 
application of a Federal Government rule or other law would 
substantially burden a person's exercise of religion, the government 
must afford that person an exemption to the rule unless it can 
demonstrate that applying the burden to that person furthers a 
compelling governmental interest and is the least restrictive means of 
doing so.\417\ Accordingly, under RFRA, we would assess whether a 
particular application of these rules substantially burdened a 
stakeholder's exercise of religion and, if so, whether the government 
has a compelling interest in denying the stakeholder's exemption 
assurance request and whether there are less restrictive alternatives 
available.\418\ The government's compelling interest in prohibiting 
discrimination on the basis of sex is to improve health outcomes, 
including for the LGBTQI+ community, and fulfill the statutory command 
of the ACA to prohibit discrimination. Whether this prohibition imposes 
a substantial burden on an entity's exercise of religion and whether it 
is the least restrictive means of advancing the government's interest 
will depend on specific facts and circumstances.
---------------------------------------------------------------------------

    \416\ See 86 FR 67067 (Nov. 24, 2021) (delegation of authority 
under which all HHS components are to ensure full compliance with 
RFRA and other constitutional requirements).
    \417\ 42 U.S.C. 2000bb-1(b).
    \418\ Fulton v. City of Phila., 593 U.S. (2021) (``The question, 
then, is not whether the City [of Philadelphia] has a compelling 
interest in enforcing its non-discrimination policies generally, but 
whether it has such an interest in denying an exception to [Catholic 
Social Services].'').
---------------------------------------------------------------------------

    The amendments we are finalizing at 45 CFR 147.104(e), 155.120(c), 
155.220(j), 156.125(b), 156.200(e), and 156.1230(b) prohibit 
discrimination on the basis of sex in the conduct of health insurance 
issuers and their officials, employees, agents, and representatives; 
States and the Exchanges; agents, brokers, or web-brokers that assist 
with or facilitate enrollment of qualified individuals, qualified 
employers, or qualified employees; issuers subject to EHB requirements; 
and QHP issuers. Lastly, we again reiterate that the amendments we are 
finalizing at 45 CFR 147.104(e), 155.120(c), 155.220(j), 156.125(b), 
156.200(e), and 156.1230(b) do not require regulated entities to cover 
any particular service not already covered.
2. Health Insurance Exchanges
a. Non-Interference With Federal Law and Nondiscrimination Standards 
(45 CFR 155.120)
    In 45 CFR 155.120 we proposed to amend paragraph (c)(1)(ii) by 
removing the term ``sex'' and adding in its place the phrase ``sex 
(including sexual orientation and gender identity).'' We did not 
receive comments unique to this section.
Summary of Regulatory Changes
    We amend 45 CFR 155.120 in paragraph (c)(1)(ii) by removing the 
term ``sex'' and adding in its place the phrase ``sex (including 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).''
b. Federally-Facilitated Exchange Standards of Conduct (45 CFR 155.220)
    In 45 CFR 155.220 we proposed to amend paragraph (j)(2)(i) by 
removing the term ``sex'' and adding in its place the phrase ``sex 
(including sexual orientation and gender identity).'' We did not 
receive comments unique to this section.
Summary of Regulatory Changes
    We amend 45 CFR 155.220 in paragraph (j)(2)(i) by removing the term 
``sex'' and adding in its place the phrase ``sex (including 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).''
c. Essential Health Benefits Package: Prohibition on Discrimination (45 
CFR 156.125)
    In 45 CFR 156.200 we proposed to amend Sec.  156.200 in paragraph 
(e) by removing the term ``sex'' and adding in its place the phrase 
``sex (including sexual orientation and gender identity).'' Section 
156.125(b) would accordingly require issuers providing EHB to comply 
with such nondiscrimination requirements as it requires that an issuer 
providing EHB must comply with the requirements of Sec.  156.200(e). We 
did not receive comments unique to this section.

[[Page 37675]]

Summary of Regulatory Changes
    Elsewhere in this rule, we amend 45 CFR 156.200 in paragraph (e) by 
removing the term ``sex'' and adding in its place the phrase ``sex 
(including discrimination on the basis of sex characteristics, 
including intersex traits; pregnancy or related conditions; sexual 
orientation; gender identity; and sex stereotypes).'' Paragraph (b) of 
45 CFR 156.125 accordingly requires issuers providing EHB to comply 
with such nondiscrimination requirements as it states that an issuer 
providing EHB must comply with the requirements of Sec.  156.200(e).
d. QHP Issuer Participation Standards (45 CFR 156.200)
    In 45 CFR 156.200 we proposed to amend paragraph (e) by removing 
the term ``sex'' and adding in its place the phrase ``sex (including 
sexual orientation and gender identity).'' We did not receive comments 
unique to this section.
Summary of Regulatory Changes
    We amend 45 CFR 156.200 in paragraph (e) by removing the term 
``sex'' and adding in its place the phrase ``sex (including 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).''
e. Direct Enrollment With the QHP Issuer in a Manner Considered To Be 
Through the Exchange (45 CFR 156.1230)
    In 45 CFR 156.1230 we proposed to amend Sec.  156.1230 in paragraph 
(b)(2) by removing the term ``sex'' and adding in its place the phrase 
``sex (including sexual orientation and gender identity).'' We did not 
receive comments unique to this section.
Summary of Regulatory Changes
    We amend 45 CFR 156.1230 in paragraph (b)(2) by removing the term 
``sex'' and adding in its place the phrase ``sex (including 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).''
3. Prohibition of Discrimination--Group and Individual Health Insurance 
Markets Guaranteed Availability of Coverage (45 CFR 147.104)
    In 45 CFR 147.104 we proposed to amend paragraph (e) by revising 
``sex'' to ``sex (including sexual orientation and gender identity).''
    The comments and our responses regarding this proposal are set 
forth below.
    Comment: Some commenters requested that CMS clarify that States, 
including State Attorneys General, may enforce section 1557 to the 
fullest extent granted by law. That request was in response to CMS' 
explanation in the Proposed Rule that it was not relying on section 
1557 as authority to amend 45 CFR 147.104 because states would not have 
authority to enforce section 1557 and CMS is of the view that partial 
reliance on section 1557 could unnecessarily complicate enforcement 
efforts. 87 FR 47898.
    Response: In the Proposed Rule, CMS explained that one of the 
primary reasons CMS did not propose to rely on section 1557 authority 
to amend 45 CFR 147.104 was the manner in which Sec.  147.104 is 
enforced. As discussed in the Proposed Rule, under PHS Act section 
2723, States have primary enforcement authority over issuers with 
respect to regulations that implement title XXVII of the PHS Act, which 
includes Sec.  147.104. CMS has a responsibility to enforce such 
regulations if CMS determines that a State is not substantially 
enforcing or the State notifies CMS that it has not enacted legislation 
to enforce or is not otherwise enforcing such regulations; otherwise, 
the State retains primary enforcement authority. Because section 1557 
is not codified in title XXVII of the PHS Act, PHS Act section 2723 
does not provide States with the authority to enforce section 1557. 
Therefore, CMS continues to be of the view that partial reliance on 
section 1557 authority could unnecessarily complicate enforcement 
efforts of Sec.  147.104.
    For this reason and because Sec.  147.104 applies to issuers that 
may not receive Federal financial assistance such that they would be 
subject to section 1557, CMS relies on its authorities under sections 
2702 and 2792 of the PHS Act when amending Sec.  147.104. 
Notwithstanding the foregoing, the Department clarifies that although 
States do not enforce the administrative procedures specified in the 
section 1557 regulation itself, States may utilize their independent 
enforcement authorities to pursue violations of law, including 
applicable Federal laws, by entities within their jurisdictions.
Summary of Regulatory Changes
    We amend 45 CFR 147.104 in paragraph (e) by removing the term 
``sex'' and adding in its place the phrase ``sex (including 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).''

V. Executive Order 12866 and Related Executive Orders on Regulatory 
Review

A. Regulatory Impact Analysis

    We have examined the impacts of the final rule under E.O. 12866, 
E.O. 14094, E.O. 13563, the Regulatory Flexibility Act (5 U.S.C. 601-
612), the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), and 
E.O. 13132 on Federalism. E.O.s 12866 and 13563 direct us to assess all 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety, and other advantages; distributive impacts; and 
equity). Section 3(f) of E.O. 12866 (as amended by E.O. 14094) defines 
a ``significant regulatory action'' as any regulatory action that is 
likely to result in a rule that may: (1) have an annual effect on the 
economy of $200 million or more (adjusted every 3 years by the 
Administrator of the Office of Information and Regulatory Affairs 
(OIRA) for changes in gross domestic product); or adversely affect in a 
material way the economy, a sector of the economy, productivity, 
competition, jobs, the environment, public health or safety, or State, 
local, territorial, or Tribal governments or communities; (2) create a 
serious inconsistency or otherwise interfere with an action taken or 
planned by another agency; (3) materially alter the budgetary impact of 
entitlements, grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (4) raise legal or policy issues 
for which centralized review would meaningfully further the President's 
priorities or the principles set forth in this Executive order, as 
specifically authorized in a timely manner by the Administrator of OIRA 
in each case. This final rule is a significant regulatory action, under 
sec. 3(f)(1) of E.O. 12866 (as amended by E.O. 14094).
    The Regulatory Flexibility Act requires us to analyze regulatory 
options that would minimize any significant impact of a rule on small 
entities. Because the costs of the final rule are small relative to the 
revenue of covered entities, including covered small entities, and 
because even the smallest affected entities would be unlikely to face a 
significant impact, we are certifying that the final rule will not have 
a significant economic impact on a substantial number of small 
entities.
    The Unfunded Mandates Reform Act of 1995 (section 202(a)) generally

[[Page 37676]]

requires us to prepare a written statement, which includes an 
assessment of anticipated costs and benefits, before proposing ``any 
rule that includes any Federal mandate that may result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100,000,000 or more (adjusted annually 
for inflation) in any 1 year.'' The current threshold after adjustment 
for inflation is $177 million, using the most current (2022) Implicit 
Price Deflator for the Gross Domestic Product. This final rule is not 
subject to the Unfunded Mandates Reform Act because it falls under an 
exception for regulations that establish or enforce any statutory 
rights that prohibit discrimination on the basis of race, color, 
religion, sex, national origin, age, or disability.\419\
---------------------------------------------------------------------------

    \419\ 2 U.S.C. 1503(2).
---------------------------------------------------------------------------

    E.O. 13132 on Federalism establishes certain requirements that an 
agency must meet when it promulgates a Proposed Rule (and subsequent 
final rule) that imposes substantial direct requirement costs on State 
and local governments, preempts State law, or otherwise has federalism 
implications. In considering the principles in and requirements of E.O. 
13132, the Department has determined that the final rule would not 
significantly affect the rights, roles, and responsibilities of the 
States.
    The Congressional Review Act (CRA) defines a ``major rule'' as any 
rule that the Administrator of OIRA of the Office of Management and 
Budget finds has resulted in or is likely to result in: (A) ``an annual 
effect on the economy of $100,000,000 or more''; (B) ``a major increase 
in costs or prices for consumers, individual industries, Federal, 
State, or local government agencies, or geographic regions''; or (C) 
``significant adverse effects on competition, employment, investment, 
productivity, innovation, or on the ability of United States-based 
enterprises to compete with foreign-based enterprises in domestic and 
export markets.'' 5 U.S.C. 804(2). Based on the analysis of this final 
rule under E.O. 12866, this rule is expected qualify under 5 U.S.C. 
804(2)(A). The Department will comply with the CRA's requirements to 
inform Congress.
    The Background and Reasons for the final rulemaking sections at the 
beginning of this preamble contains a summary of this final rule and 
describes the reasons it is needed.
1. Public Comments
    Comment: OCR received some comments discussing the cost of notices 
and taglines \420\ in addition to requests that OCR work with the 
health care industry to develop future regulations. One commenter 
explained how the cost of including taglines averages up to $8.91 per 
month per covered entity and upwards of $2 million a year for the 
health insurance industry. Another health insurer commenter stated that 
they have spent over $16 million on notices and taglines since 2016 and 
estimated that they have spent over $3 million in 2022 alone. However, 
neither commenter provided data explaining the source or more detail on 
the cost estimates. Another commenter noted that the Proposed Rule does 
not adequately answer complaints received in prior 1557 rulemakings on 
the frequency and volume of materials related to the notice and tagline 
sections of the rule but did not provide any data with their comment.
---------------------------------------------------------------------------

    \420\ Commenters referred to ``taglines,'' which were required 
in the 2016 Rule at former Sec.  92.8(d). This final rule does not 
require ``taglines'' but instead requires a notice of availability 
of language assistance services and auxiliary aids and services 
(referred to as ``Notice of Availability'') at Sec.  92.11.
---------------------------------------------------------------------------

    Response: Based on costs estimated in this analysis, OCR derives a 
monthly cost of notices ranging from $21.28 to $26.60 per entity 
depending on the prevalence of electronic delivery. These cost 
estimates include the total notices of nondiscrimination and notices of 
availability of language assistance services and auxiliary aids and 
services (``Notices of Availability''); OCR therefore finds the 
commenter's estimate of $8.91 per month for Notices of Availability as 
plausible and consistent with the estimates in section 2 of the 
Regulatory Impact Analysis. OCR also notes that the cost estimates that 
are given are averages, and it is expected that there will be some 
entities that would have costs that are well above or below average. 
Furthermore, it is expected that large entities would have higher than 
average costs due to the increased number of notices they would send to 
individuals.
    Comment: A few commenters expressed general concerns on the 
potential for an increase in premiums and costs within the health care 
industry. Commenters suggested the final rule would create a moral 
hazard for individuals or made general statements without data that 
increasing coverage of goods and services would increase costs and 
resulting premiums. Other commenters focused on the harm to small 
business the rule would cause from raising the insurance costs for low-
income individuals that small businesses employ. Commenters argued this 
would lead to layoffs of said employees and limit what services would 
be available.
    Response: As discussed in section 2 of the RIA, OCR expects that 
there is a possibility of increased premiums and costs due to the rule, 
but the possible increase is expected to be a small percentage of the 
current costs due to the low utilization of gender-affirming care and 
supply of specialists capable of offering said services. OCR does not 
expect the final rule to have a significant economic impact on small 
entities based on the analysis in the Regulatory Flexibility Act (RFA).
    Comment: A couple of commenters were concerned that the rule would 
make it more difficult for small entities to compete and remain 
compliant, which would give a competitive advantage to larger entities 
in the industry and lead to more consolidation of supplier and provider 
markets.
    Response: OCR appreciates the concerns raised by these commenters; 
however, as discussed in the RFA, OCR does not expect a significant 
impact of costs on a substantial number of small entities.
    Comment: A few commenters claimed that the final rule would lead to 
lower innovation within the health care industry due to an increased 
need to spend funds fighting discrimination instead of medical 
research.
    Response: As discussed in section 2 of the RIA, OCR estimates that 
additional costs from the inclusion of nondiscrimination requirements 
will be a small percentage of the total cost due to the limited number 
of individuals that would seek gender-affirming care, thereby limiting 
any potential decrease in available funds for medical research.
    Comment: A few commenters expressed concern that the final rule 
would limit rural health care because it would make it more difficult 
for rural entities to stay compliant and would worsen their financial 
positions, potentially resulting in closures.
    Response: As discussed in section 2 of the RIA, OCR estimates that 
the costs associated with the final rule would be a small percentage 
increase in overall costs. Furthermore, OCR reviewed relevant 
literature and found no studies which suggested that rural hospitals 
would be particularly impacted by expanded health care services. 
Finally, as discussed in the small entity analysis section of this RIA, 
OCR does not estimate a significant economic impact on a substantial 
number of small entities.
    Comment: Several commenters expressed concern that the final rule 
would lead to fewer health care professionals in the industry for a

[[Page 37677]]

variety of reasons. Some of the commenters stated that the final rule 
would lead to health care professionals leaving the industry from the 
lack of conscience or religious exemptions. A couple of commenters 
stated that future health care professionals would not enter the 
industry in the future as the final rule would require them to violate 
the Hippocratic Oath or their religious beliefs.
    Response: As discussed in section 2 of the RIA and preamble of the 
rule, the final rule includes a variety of protections for religious 
freedom and conscience rights, including a process whereby entities may 
rely on these protections and seek assurance of them from HHS. See 
Sec.  92.302.
    Comment: Several commenters noted that portions of the data that 
were used in the RIA, such as the number of covered entities and number 
of small entities, are outdated and need to be updated for an accurate 
cost estimate to be made.
    Response: OCR agrees with commenters that data sources could be 
updated from the Proposed Rule. In this final rule RIA, the data for 
the number of covered entities, number of entities with more than 15 
employees, the number of small entities, and hourly wages have been 
updated to the most recent data available.
    Comment: A few commenters expressed concern that the final rule 
would cause irreparable harm to individuals who regret transitions.
    Response: Commenters do not provide supporting evidence or data on 
the frequency or cost of potential irreparable harm. OCR disagrees with 
the commenters and did not find studies providing evidence or data on 
the frequency or cost of what the commenters characterize as 
irreparable harm, and therefore makes no changes to the final rule.
    Comment: One commenter expressed concern that long-term costs 
associated with gender-affirming care are not accounted for within the 
RIA and that the studies used may not be accurate. Due to this, the 
commenter stated that the supplementary information provided is at best 
speculative.
    Response: The main source for costs related to gender-affirming 
care come from a peer reviewed article in the New England Journal of 
Medicine, a well-respected medical journal. The cost associated with 
gender-affirming care is based on actual cost data from the Defense 
Manpower Data Center, which is part of the Department of Defense (DOD). 
As noted, the final rule does not mandate the provision of or coverage 
of gender-affirming care, or any particular health service. However, to 
the extent a covered entity provides coverage for a particular health 
service, the covered entity must provide the health service to all 
individuals in a neutral, nondiscriminatory manner consistent with this 
rule.
    Comment: One commenter stated that the costs of algorithmic 
discrimination have been quantified and asked OCR to include examples 
of the costs of such discrimination.
    Response: OCR includes a specific provision on algorithmic 
discrimination in the final rule and qualitatively discusses the 
potential costs to individuals from discriminatory application of 
algorithms and other decision support tools in the benefits section.
2. Summary of Costs and Benefits
    This analysis quantifies several categories of costs to covered 
entities and to the Department under the final rule. Specifically, we 
quantify costs associated with covered entities training employees, 
revising policies and procedures, and costs associated with notices, 
including the Notice of Nondiscrimination and Notice of Availability. 
We quantify costs associated with provisions of the final rule related 
to documenting training activities performed under the final rule. We 
also quantify incremental costs associated with coverage for gender-
affirming care (which, as noted above, is not mandated by the rule). 
Our analysis also addresses uncertainty in costs associated with 
notices and gender-affirming care, which is discussed in greater detail 
in the notices section of subsection B of section 2 of the RIA. We 
separately report a full range of cost estimates of about $523 million 
to $1,302.3 million using a 7 percent discount rate, and a full range 
of cost estimates of about $511.4 million to $1,290.7 million using a 3 
percent discount rate. All cost estimates are in 2022 dollars. We 
conclude that the final rule would result in annualized costs over a 5-
year time horizon of $646.5 million or $637.1 million, corresponding to 
a 7 percent or a 3 percent discount rate respectively.
    In addition to these quantified cost estimates, the main analysis 
includes a discussion of costs that we do not quantify, and a 
discussion of the potential benefits under the rule that we similarly 
do not quantify. In addition to the impacts that we quantify, this 
final rule could also result in increases in premiums, which would 
result in increases in Exchange user fees and Federal expenditures for 
advance payments of the premium tax credit. These increases would be 
minimal due to the low utilization of gender affirming care and the 
availability of the services.

                                   Table 1--Annualized Costs of the Final Rule
                                           [$ millions/year (percent)]
----------------------------------------------------------------------------------------------------------------
                                                                              Discount rate
 Primary estimate     Low estimate      High estimate       Year dollars        (percent)        Period covered
----------------------------------------------------------------------------------------------------------------
           $646.5               $523           $1,302.3               2022                  7          2024-2028
           $637.1              511.1            1,290.7               2022                  3          2024-2028
----------------------------------------------------------------------------------------------------------------

a. Baseline Conditions
    Section 1557 prohibits an individual from being excluded from 
participation in, denied the benefits of, or otherwise subjected to 
discrimination on the basis of race, color, national origin, sex, age, 
or disability in certain health programs and activities. It applies to 
any health program or activity, any part of which is receiving Federal 
financial assistance, and to any program or activity that is 
administered by an executive agency or any entity established under 
title I of the ACA.\421\ On May 18, 2016, the Department published a 
final rule to implement section 1557 under the statute5 U.S.C. 301. 81 
FR 31375. On June 19, 2020, the Department published a final rule that 
revised the Department's approach to implementing section 1557. 85 FR 
37160. As described in greater detail in the Background section of this 
preamble, neither final rule was fully implemented as published, and 
certain provisions of the 2020 Rule remain the subject of ongoing 
litigation.
---------------------------------------------------------------------------

    \421\ 42 U.S.C. 18116.

---------------------------------------------------------------------------

[[Page 37678]]

    The baseline scenario of no further regulatory action is 
substantially informed by the RIAs published with the 2016 and 2020 
Rules. The 2016 RIA identified five sources of monetized costs: 
training and familiarization, enforcement, notice publication, sex 
discrimination policy and procedure changes, and language access plans. 
The bulk of the monetary impacts identified in the 2016 RIA occur in 
the first two years under the 2016 rule, with costs continuing in 
future years only for enforcement and language access plans.
    The 2020 RIA adopted many of the assumptions contained in the 2016 
RIA. For example, it assumed that many of the initial activities 
anticipated under the 2016 Rule were performed, and that the first two 
years of costs attributable to the 2016 Rule were incurred.\422\ The 
2020 RIA identifies cost savings only ``from the repeal of (1) the 
provision on the incentive for covered entities to develop language 
access plans and (2) the provisions on notice and taglines.'' 85 FR 
37224. The 2020 RIA also identifies costs in the first year ``on 
covered entities' voluntary actions to re-train their employees on, and 
adopt policies and procedures to implement, the legal requirements of 
this final rule.'' 85 FR 37224.
---------------------------------------------------------------------------

    \422\ E.g., 85 FR 37235 (``The Department assumes sunk costs 
cannot be recovered by this rule, and therefore that initial 
language access plan development costs attributable to the 2016 Rule 
cannot be recovered.'').
---------------------------------------------------------------------------

    In establishing a baseline scenario, this analysis similarly 
maintains a number of assumptions and estimates contained in prior 
analyses. For example, the baseline scenario includes some ongoing 
costs that are attributable to the 2016 Rule, such as the costs of 
enforcement. The 2016 RIA estimated that the costs of enforcement would 
be $108.8 million (reported in 2022 dollars), which we adopt as the 
costs under both the baseline and final rule scenarios. Similarly, we 
adopt the assumption in the 2020 RIA that covered entities continue to 
provide ongoing training attributable to the 2016 Rule, which was not 
impacted by the 2020 Rule. We include these ongoing training 
activities, including annual refresher training for returning employees 
and training for new employees, in the baseline scenario of no 
regulatory action.
    The final rule analysis updates baseline conditions on the number 
of covered entities. The 2016 Rule, 2020 Rule, and 2022 NPRM all used 
275,002 covered entities, and 41,250 covered entities that have 15 or 
more employees. This final rule updates the covered entities to 266,297 
and the number of covered entities with 15 or more employees to 63,950. 
Table 2 presents the updated data on covered entities. To update this 
data, we identified the source of the original data being the 2012 
Statistics of U.S. Businesses (SUSB) Annual Data Tables by 
Establishment Industry and found the 2020 version of the same dataset. 
Using the same NAICS codes from the Proposed Rule we identify the 
number of entities under these NAICS codes in addition to the number of 
firms with 15 or more employees.

                                            Table 2--Covered Entities
----------------------------------------------------------------------------------------------------------------
                                                                                                Firms with 15 or
                 NAICS code                          Business type           Firm count 2020     more employees
----------------------------------------------------------------------------------------------------------------
62142......................................  Outpatient mental health and               7,649              2,911
                                              substance abuse centers.
621491.....................................  HMO medical centers..........                 84                 21
621492.....................................  Kidney dialysis centers......                449                216
621493.....................................  Freestanding ambulatory                    4,554              2,204
                                              surgical and emergency
                                              centers.
621498.....................................  All other outpatient care                  6,307              2,766
                                              centers.
6215.......................................  Medical and diagnostic                     7,200              1,892
                                              laboratories.
6216.......................................  Home health care services....             25,718             10,901
6219.......................................  All other ambulatory health                7,091              2,589
                                              care services.
62321......................................  Residential intellectual and               6,674              3,628
                                              developmental disability
                                              facilities.
6221.......................................  General medical and surgical               2,445              2,344
                                              hospitals.
6222.......................................  Psychiatric and substance                    434                414
                                              abuse hospitals.
6223.......................................  Specialty (except psychiatric                301                280
                                              and substance abuse)
                                              hospitals.
6231.......................................  Nursing care facilities                    9,824              7,513
                                              (skilled nursing facilities).
45611......................................  Pharmacies and drug stores...             19,346              3,436
6211.......................................  Offices of physicians........            167,294             22,494
524114.....................................  Insurance Issuers............                869                341
                                             Navigator grantees...........                 58  .................
                                            --------------------------------------------------------------------
                                             Total Entities...............            266,297             63,950
----------------------------------------------------------------------------------------------------------------

    In the next section, we discuss the incremental costs of the final 
rule, which exclude ongoing costs attributable to prior rulemaking.
b. Costs of the Final Rule
    This analysis anticipates that the final rule would result in one-
time costs to covered entities to process assurance of exemption 
requests and revise policies and procedures. The final rule would 
result in costs associated with a revised approach to notices, 
including the Notice of Nondiscrimination and Notice of Availability, 
costs to review new decision support tool requirements, and costs to 
training employees. The final rule would also result in costs 
associated with provisions related to documenting training activities 
performed under the final rule.
    The final rule might result in additional costs associated with 
coverage for gender-affirming care. We discuss the potential costs 
associated with gender-affirming care coverage and the potential that 
some or all of these costs would be offset by reductions in spending on 
other types of care. We

[[Page 37679]]

reiterate that the final rule does not mandate the provision of or 
coverage of gender-affirming care, or any particular health service. 
However, to the extent a covered entity provides coverage for a 
particular health service, the covered entity must provide the health 
service to all individuals in a neutral, nondiscriminatory manner 
consistent with this rule.
    The analysis also discusses other potential costs of the final rule 
that we do not quantify.
Training
    The Department anticipates that some covered entities would incur 
costs to train or retrain employees under the final rule. To calculate 
the costs related to training, we followed an approach common to both 
the 2016 and 2020 RIAs. Both analyses estimate that covered entities 
would train their employees on the requirements. This final rule uses 
the updated estimate of covered entities (266,297) as the basis for 
calculating the total costs. The 2020 RIA adjusted the number of 
covered entities downward by 50 percent, anticipating that some covered 
entities would not modify their procedures in response to the 2020 
final rule, and would therefore not need to offer new training. Both 
RIAs anticipated that employers would most likely train employees who 
interact with the public and recognized that the percentage of 
employees that interact with patients and the public vary by covered 
entity. To account for this, the analyses adopted a central estimate of 
50 percent of staff at covered entities that received one-time training 
on the requirements of the regulation.
    Both RIAs reported the number of employees at covered entities by 
occupation category. To monetize the total costs of training, the RIAs 
adopted a value of time based on the average fully loaded wage rate for 
each occupation, combined with an assumption about the duration of the 
training. The 2016 RIA assumed that 50 percent of total employees at 
covered entities would receive training, while the 2020 RIA assumed 
that 25 percent of employees would receive training. Both RIAs assumed 
the typical training would last one (1) hour. For this analysis, we 
assume that 75 percent of total employees at covered entities would 
receive training, and that this training would last one (1) hour. This 
estimate is consistent with an assumption that all covered entities 
would revise their policies and procedures under the final rule and 
that most employees at covered entities would receive training.
    As a necessary first step in calculating the incremental total 
costs of training attributable to the final rule, we have collected the 
most recent available data on the number of employees that would likely 
undergo training under the final rule, and data on the average wage 
rate by occupation for these employees.
    The first category of health care staff that may receive training 
comprises health diagnosing and treating practitioners. This category 
includes physicians, dentists, optometrists, physician assistants, 
occupational, physical, speech and other therapists, audiologists, 
pharmacists, registered nurses, and nurse practitioners. The U.S. 
Bureau of Labor Statistics (BLS) Occupational code for this grouping is 
29-1000, and the 2022 reported employment count for this occupational 
group is approximately 5.96 million, with average loaded wages of 
$114.42 per hour at the national level.\423\
---------------------------------------------------------------------------

    \423\ U.S. Bureau of Labor Statistics, May 2022 National 
Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_nat.htm. The average loaded wage for Healthcare 
Diagnosing or Treating Practitioners is derived by multiplying the 
mean hourly rate by 200 percent to include the mean hourly wage, the 
cost of fringe benefits and overhead costs ($57.21 * 200% = 
$114.42).
---------------------------------------------------------------------------

    The second category of health care staff that the Department 
assumes will receive training comprises degreed technical staff 
(Occupation code 29-2000) and accounts for 2.95 million employed 
individuals with average loaded wages of $51.18 per hour at the 
national level.\424\ Technicians work in almost every area of health 
care: x-ray, physical, speech, psychiatric, dietetic, laboratory, 
nursing, and records technicians, to name but a few areas.
---------------------------------------------------------------------------

    \424\ U.S. Bureau of Labor Statistics, May 2022 National 
Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_nat.htm.
---------------------------------------------------------------------------

    The third category of health care staff that the Department assumes 
will receive training comprises non-degreed medical assistants 
(Occupation code 31-0000), which includes psychiatric and home health 
aides, orderlies, dental assistants, and phlebotomists. Health care 
support staff (non-degreed, medical assistants) operate in the same 
medical disciplines as technicians, but often lack professional degrees 
or certificates often required for degreed technical staff. There are 
approximately 6.79 million employed individuals in these occupations in 
the health care and social assistance sector, with average loaded wages 
of $34.20 per hour at the national level.\425\
---------------------------------------------------------------------------

    \425\ U.S. Bureau of Labor Statistics, May 2022 National 
Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_nat.htm.
---------------------------------------------------------------------------

    The fourth category of health care staff that the Department 
assumes will receive training is health care managers (Occupation code 
11-9111) and accounts for approximately 0.48 million employed 
individuals with average loaded wages of $123.06 per hour at the 
national level.\426\
---------------------------------------------------------------------------

    \426\ U.S. Bureau of Labor Statistics, May 2022 National 
Occupational Employment and Wage Estimates, https://www.bls.gov/oes/current/oes_nat.htm.
---------------------------------------------------------------------------

    The fifth category of health care staff that the Department assumes 
will receive training is office and administrative assistants 
(Occupation code 43-0000) and accounts for approximately 2.719 million 
employed individuals with average loaded wages of $41.16 per hour 
within the Health Care and Social Assistance sector.\427\ These workers 
are often the first staff patients encounter in a health facility and, 
because of this, covered entities might find it important that staff, 
such as receptionists and assistants, receive training on the 
regulatory requirements. The Department assumes that outreach workers 
are included in the five categories listed above.
---------------------------------------------------------------------------

    \427\ U.S. Bureau of Labor Statistics, National Industry-
Specific Occupational Employment and Wage Estimates, Sector 62- 
Health Care and Social Assistance, https://www.bls.gov/oes/current/naics2_62.htm#43-0000.
---------------------------------------------------------------------------

    The Department estimates that there are a total 18.9 million 
employees at covered entities, of which we assume 14.2 million, 75 
percent, would receive training attributable to the final rule. Across 
the five occupation categories, we estimate a weighted hourly wage rate 
of $32.70, or a weighted fully loaded hourly wage rate of $65.41. 
Assuming that the average training takes one (1) hour and adopting a 
value of time based on fully loaded wage rates, we estimate total 
first-year training costs for all covered entities to be approximately 
$927.3 million \428\ As a sensitivity analysis, we considered the 
scenario of covered entities providing training to all employees, 18.9 
million, not just employees who interact with the public, 14.2 million. 
Under this scenario, the total cost of training would increase to about 
$1.2 billion. These costs are likely overstated since this training may 
supplement or replace expected annual or other ongoing training 
activities at covered entities. To the extent that covered entities 
reduce time spent on other training activities, these costs would 
offset some of the total costs attributable to the final rule.
---------------------------------------------------------------------------

    \428\ Numbers may not multiply due to rounding.
---------------------------------------------------------------------------

    Lastly, the Department assumes that 91 investigators at OCR, who 
are equivalent to GS-12 Step 1 employees

[[Page 37680]]

and whose average hourly loaded wage is $65.46, will receive a one-time 
training during the first year of the promulgation of this rule.\429\ 
Each individual would receive 8 hours of training for a total of 
$47,655 (91 x 1 x $65.46) in training costs. This training would not 
occur in any subsequent years.
---------------------------------------------------------------------------

    \429\ U.S. Off. of Personnel Mgmt., Salary Table 2022-GS. GS-12 
Step 1 Employee, https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/pdf/2022/GS_h.pdf/.
---------------------------------------------------------------------------

    In addition to the first-year training costs, we anticipate that 
the final rule would result in additional costs associated with ongoing 
training, including annual refresher training for returning employees 
and training for new employees. As discussed in the Baseline Conditions 
section, we assume that many covered entities are routinely carrying 
out these activities, absent further regulatory action. However, we 
anticipate that the final rule would result in a larger share of 
employees at covered entities receiving such training. To quantify the 
change in training activities between the baseline scenario and the 
final rule scenario, we take the difference between the share of 
employees receiving training under the baseline scenario and the final 
rule scenario. We carry through an assumption from the 2016 RIA, which 
assumed that 50 percent of total employees at covered entities receive 
training and compare this to an assumption in this final RIA that 75 
percent of total employees at covered entities would receive training. 
This yields an estimate of 25 percent of total employees at covered 
entities that would receive training in subsequent years under the 
final rule. We adopt the same weighted hourly wage estimate, number of 
employees, and estimate the total ongoing annual training costs as 
$309.1 million. This was calculated by multiplying the total number of 
employees at covered entities by .25 and multiplying by $65.41.
    Finally, the Department assumes covered entities may require 
employees to undergo one (1) hour of training in response to in OCR 
investigation. As it is difficult to determine the type of employee 
that would be required go through additional training, we use the 
average loaded hourly wage of $65.41 to evaluate the opportunity cost 
of training time. To estimate the frequency with which covered entities 
may assume this cost, we reviewed OCR complaints from the 2023 calendar 
year and identified 60 cases investigated under section 1557 that were 
closed with a covered entity either engaging in voluntary corrective 
action in response to the investigation or entering into a Voluntary 
Resolution Agreement with the agency.\430\ Using this as a baseline, 
the Department assumes that for every year of the observation period 
there would be 60 potential instances of this additional training, and 
that it would be conducted in each case. As a result, we estimate that 
covered entities would incur $3,924 in additional training costs for 
every year of the observation period.\431\
---------------------------------------------------------------------------

    \430\ U.S. Dep't of Health & Hum. Servs., Off. for Civil Rts., 
Complaints Closed During Calendar Year 2023 within the Section 1557 
Program Area.
    \431\ $3,924 = ($65.41 x 1 x 60).
---------------------------------------------------------------------------

Revising Policies and Procedures
    As discussed above in the previous section, the Department 
anticipates that all covered entities, or approximately 266,297 
entities, would revise their policies and procedures under the final 
rule, with approximately half of these entities requiring less 
extensive revisions. For covered entities with more extensive 
revisions, we adopt the estimates contained in the 2020 RIA, with four 
(4) total hours spent on revisions per entity. Of these, three (3) 
would be spent by a mid-level manager equivalent to a first-line 
supervisor (Occupation code 43-1011), at a cost of $62.98 ($31.49 x 2) 
per hour after adjusting for the cost of fringe benefits and other 
indirect costs, while an average of one (1) hour would be spent by 
executive staff equivalent to a general and operations manager 
(Occupation code 11-1021), at a cost of $118.14 ($59.07 x 2) per hour 
at the national level, including the cost of fringe benefits and other 
indirect costs.\432\ For covered entities with less extensive 
revisions, we assume two (2) total hours spent on revisions per entity. 
Of these, one (1) would be spent by a mid-level manager, and one (1) 
would be spent by executive staff.
---------------------------------------------------------------------------

    \432\ U.S. Bureau of Labor Statistics, Occupational Employment 
and Wages, May 2022, 43-1011 First-Line Supervisors of Office and 
Administrative Support Workers, https://www.bls.gov/oes/current/oes431011.htm.
---------------------------------------------------------------------------

    We monetize the time spent on revising policies and procedures by 
estimating a total cost per entity of $307.08 or $181.12, depending on 
the extent of the revisions. For the 133,149 covered entities with more 
extensive revisions, we estimate a total cost of about $40.8 million. 
For the 133,149 covered entities with less extensive revisions, we 
estimate a total cost of about $24.1 million. We estimate the total 
cost associated with revisions to policies and procedures under the 
final rule of $65.0 million.
    The above estimates of time and number of entities that would 
choose to revise their policies under the regulation are approximate 
estimates based on general BLS data. We are unable to precisely 
estimate the total number of covered entities that would choose to 
revise their policies and procedures under the new regulation or to 
what extent they would make these changes due to the wide range of 
types and sizes of covered entities, from complex multi-divisional 
hospitals to small neighborhood clinics and physician offices.
    In addition to the initial revisions of policies and procedures, 
the Department assumes some covered entities may elect or be required 
to revise their policies and procedures following an investigation. We 
assume that such revisions would cost the same as the original revision 
that occurs in the first year of the observation period. As discussed 
above, the Department estimates that during every year of the 
observation period, there would be an average of 60 instances in which 
corrective actions may be taken due to a 1557 investigation. As 
revising policies and procedures is a more significant corrective 
action compared to corrective training, the Department assumes that it 
will occur in response to only half of the investigations. The 
Department continues to use the assumption that half of the entities 
revising their policies and procedures would be major firms while the 
other half would be minor firms. The estimated total annual cost for 
revisions of policies and procedures in response to an OCR 
investigation is $7,323 (307.08 x 15 + 181.12 x 15) in each year of the 
observation period.
Notices
    The final rule requires the 266,297 covered entities to provide a 
Notice of Nondiscrimination to participants, enrollees, and 
beneficiaries, hereafter referred to as beneficiaries of its health 
program or activity, and members of the public. It also requires 
covered entities to provide a Notice of Availability. These provisions 
resemble elements of the 2016 Rule that were repealed in the 2020 Rule; 
however, the approach under the final rule provides a narrower set of 
situations where covered entities would be required to provide these 
notices. Both types of notices are required (1) on an annual basis; (2) 
upon request; (3) at a conspicuous location on the covered entity's 
health program or activity website; and (4) in clear and prominent 
physical locations where the health program or activity interacts with 
the public.

[[Page 37681]]

    The Notice of Availability is also required in the following 
electronic and written communications related to the covered entity's 
health programs and activities: (1) notice of nondiscrimination 
required by final Sec.  92.10; (2) notice of privacy practices required 
by 45 CFR 164.520; (3) application and intake forms; (4) notices of 
denial or termination of benefits or services, including Explanations 
of Benefits (EOBs) and notices of appeal and grievance rights; (5) 
communications related to an individual's rights, eligibility benefits, 
or services that require or request a response from a beneficiary; (6) 
communications related to a public health emergency; (7) consent forms 
and instructions related to medical procedures or operations, medical 
power of attorney, or living will (with an option of providing only one 
notice for all documents bundled together); (8) discharge papers; (9) 
communications related to the cost and payment of care with respect to 
an individual, including good faith estimates and medical billing and 
collections materials; (10) complaint forms; and (11) patient and 
member handbooks.
    For the purposes of the Notice of Availability analysis, we base 
our estimates of the number of communications containing these notices 
on a subset of the communications identified in the 2020 RIA. We 
include communications that are EOBs. The Department received feedback 
regarding the financial burden imposed by applying the Notice of 
Availability requirements to EOBs. EOBs are typically an individual's 
first, and often only, notice of a denial or termination of benefits or 
services, and as such, the Notice of Availability requirement is 
essential in this context to ensure timely and equitable access to 
appeals processes. The final rule at Sec.  92.11(d) permits covered 
entities to provide individuals with the option to opt out of receiving 
the Notice of Availability on an annual basis, which will reduce the 
cost and burden associated with these requirements. In addition, as 
beneficiaries increasingly elect to receive EOBs and other types of 
communications electronically, we expect the cost of these requirements 
to decrease over time. We adopt the other estimates as a reasonable 
proxy for the number of communications that would be anticipated under 
the final rule. These estimates are intended to encompass all 
categories of Notices of Availability required under the final rule. We 
have increased the total number of communications containing notices by 
10 percent to account for the additional communications related to the 
cost and payment of care with respect to an individual, including good 
faith estimates and medical billing and collections materials, which 
were not included in the Proposed Rule.\433\
---------------------------------------------------------------------------

    \433\ This reflects the increase from 10 categories accounted 
for by communications and notices in the Proposed Rule RIA to 11 
categories, or an increase of 10 percent.
---------------------------------------------------------------------------

    Table 3 below reports the number of communications containing 
notices anticipated under the final rule and presents the costs of 
these communications. Our cost estimates reflect a wide range of 
uncertainty in the cost per communication. For our primary scenario, we 
adopt a central estimate of the average costs to print and fold paper 
forms containing prescribing information of $0.05 (calculated as the 
midpoint estimate of a range from $0.03 to $0.07), reported in 2010 
dollars.\434\ We explore the sensitivity of the overall cost estimates 
under a low-cost ($0.035 per unit) and high-cost ($0.32 per unit) 
scenario, reported in 2018 dollars, which matches the range contained 
in the 2020 RIA. We adjust these per-unit cost inputs for inflation to 
2022 price levels using the Implicit Price Deflator, resulting in a 
primary per-unit cost estimate of about $0.067 and a full range of 
about $0.045 to $0.37.\435\ Combining these per-unit cost estimates 
with the count of each notice results in a primary estimate of $93.2 
million, with a range of estimates between $57.2 million and $522.8 
million. Following the approach in the 2020 RIA, we adjust this figure 
downward by 50 percent to account for the lower cost of electronic 
communications. For this adjustment, we adopt a measure of the share of 
respondents reporting that they used a ``Digital (mobile app or 
website)'' method to contact or interact with their health insurance 
issuer or plan in the last year when viewing an online statement.\436\ 
We anticipate that the share of communications occurring online will 
increase over time but have not accounted for a trend for the 5-year 
time horizon of this analysis. This adjustment results in a primary 
estimate of the adjusted annual total of $46.6 million, with a range of 
costs between $28.6 million and $261.4 million. These costs would occur 
in each year of the time horizon of the analysis.
---------------------------------------------------------------------------

    \434\ U.S. Dep't of Health & Hum. Servs., Food & Drug Admin., 
Electronic Distribution of Prescribing Information for Human 
Prescriptions Drugs, Including Biological Products, Proposed Rule, 
79 FR 75506 (Dec. 18, 2014).
    \435\ Fed. Reserve Bank of St. Louis, Gross Domestic Product: 
Implicit Price Deflator (GFPDEF), https://fred.stlouisfed.org/series/GDPDEF.
    \436\ Saurabh Gupta et al., HFS Rsch. & Cognizant, Health 
Consumers Want Digital: It's Time for Health Plans to Deliver, p. 4 
(2021), https://www.cognizant.com/en_us/general/documents/cognizant-hfs-health-consumers-want-digital-its-time-for-health-plans-to-deliver.pdf.

                                       Table 3--Cost of Notice Provisions
                                                 [2022 Dollars]
----------------------------------------------------------------------------------------------------------------
                                                                            Cost scenario ($ millions)
                  Cost element                         Count     -----------------------------------------------
                                                    (millions)          Low           Primary          High
----------------------------------------------------------------------------------------------------------------
Eligibility and enrollment communications.......            19.5            $0.8            $1.3            $7.2
Annual notice of benefits.......................           135.3             5.5             8.9            49.9
Explanations of benefits--hospital admissions...           105.6             4.3             6.9            39.0
Explanations of benefits--physician visits......          1035.1            41.8            68.1           382.0
Medical bills--hospital admissions..............            12.1             0.5             0.8             4.5
Medical bills--physician visits.................           108.9             4.4             7.2            40.2
Total, Unadjusted...............................          1416.5            57.2            93.2           522.8
Total, Adjusted for Electronic Delivery.........          1133.2            28.6            46.6           261.4
----------------------------------------------------------------------------------------------------------------


[[Page 37682]]

Documentation Requirements
    The final rule requires covered entities to contemporaneously 
document certain other activities performed under the final rule. This 
includes activities such as employees' completion of the training 
required by this section in written or electronic form. The final rule 
also requires covered entities to retain certain records. These and 
other requirements, and the associated cost estimates, are discussed in 
greater detail in the PRA section.
    The costs associated with retaining records related to grievances 
filed with a covered entity is the time spent by the staff of covered 
entities to store the complaints for no less than three (3) years. We 
calculate the costs of labor as one (1) employee per covered entity 
with more than 15 employees (63,950) spending 10 hours to store 
complaints and the associated records required under final Sec.  
92.8(c)(2) each year.\437\ We assume that administrative or clerical 
support personnel would perform these functions. The mean hourly wage 
for this occupation is $19.02 per hour, which we double to account for 
overhead and other indirect costs. We estimate the costs of retaining 
records related to grievances filed at all covered entities would be 
$24.3 million annually ($19.02 x 2 x 10 x 63,950). This estimation 
approach will overstate the costs if many covered entities already 
retain complaint information.
---------------------------------------------------------------------------

    \437\ This estimate is consistent with the 2016 Rule's 
Regulatory Impact Analysis: ``Of the 275,002 covered entities, 
approximately 15 percent employ more than 15 employees, resulting in 
approximately only slightly more than 41,250 covered entities being 
required to have grievance procedures and designate a responsible 
official.'' 81 FR 31375, 31452 (May 18, 2016).
---------------------------------------------------------------------------

    The costs associated with documenting employee training is the time 
spent by the staff of covered entities to (a) create training 
attendance forms, and (b) store the training sign-up sheet. We 
calculate the costs of labor as one (1) employee spending 15 minutes 
(0.25 hours) to create the sign-up sheet during the first year and one 
(1) employee spending one (1) hour collecting and storing the 
attendance forms the first year and subsequent years. We assume that 
administrative or clerical support personnel would perform these 
functions. The mean hourly wage for this occupation is $19.02 per hour, 
which we double to account for overhead and other indirect costs. We 
estimate the costs of documenting employee training would be $12.6 
million in the first year ($19.02 x 2 x 1.25 x 266,297) and $10.1 
million in subsequent years ($19.02 x 2 x 1 x 266,297).
Coverage for Gender-Affirming Care
    In addition to the cost some covered health insurance issuers and 
plans may incur for revising policies and procedures to comply with the 
rule, there is a possibility that such issuers and plans may incur a de 
minimis cost related to the cost of coverage for gender-affirming care. 
Various studies, however, suggest that any such increased costs will 
likely be negligible, and that any increases may be offset by savings 
from decreased utilization of other services. The likelihood of 
significant costs is low both because transgender individuals make up a 
very small percentage of the population and because many transgender 
individuals do not seek gender-affirming surgeries or other types of 
care.\438\
---------------------------------------------------------------------------

    \438\ See, e.g., U.S. Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Colorado 2023 EHB-Benchmark Plan Actuarial Report, 
https://www.cms.gov/CCIIO/Resources/Data-Resources/ehb. Suite of 
Gender-affirming care benefits to treat gender dysphoria resulted 
cost estimate was 0.04 percent of the total allowed claims assuming 
utilization would be for adults.
---------------------------------------------------------------------------

    In April 2012, the California Department of Insurance conducted an 
Economic Impact Assessment on Gender Nondiscrimination in Health 
Insurance that found that prohibiting discrimination on the basis of 
gender identity in health insurance plans would have an ``insignificant 
and immaterial'' impact on costs.\439\ This conclusion was based on 
evidence of low utilization and the estimated number of transgender 
individuals in California. The transgender population of California was 
estimated to range between 0.0022 percent and 0.0173 percent.\440\ The 
study revealed that, contrary to common assumptions, not all 
transgender individuals seek surgical intervention, and that gender-
affirming health care differs according to the needs and pre-existing 
conditions of each individual.\441\ Despite expecting a possible spike 
in demand for benefits due to former or current unmet demand, the 
California Insurance Department concluded that any increased 
utilization that might occur over time is likely to be so low that any 
resulting costs remain actuarially immaterial.\442\ The Assessment 
notes the experience of one employer that initially established premium 
surcharges to cover the anticipated cost of gender-affirming care, 
reporting that the employer subsequently eliminated the surcharges 
because they found that the funds collected were nearly 15 times the 
amount expended on care.\443\ While it did not analyze any original 
data, a 2018 analysis by the State of Wisconsin's Department of 
Employee Trust Funds cited numerous studies finding that the cost of 
coverage was minimal, and noted that ``[w]hile it is challenging to 
predict the costs of care averted for any condition, there is some 
evidence that the costs associated with providing transgender-inclusive 
plans is met with reduced costs related to comorbidities.'' \444\ Other 
studies looking at both public and private sector plans have reached 
similar conclusions. One study published in the New England Journal of 
Medicine projected that the cost for providing gender-affirming care 
benefits to members of the military would result in an annual increase 
of 0.012 percent of health care costs, ``little more than a rounding 
error in the military's $47.8 billion annual health care budget.'' 
\445\ A 2013 study of 34 public and private sector employers that 
provided nondiscriminatory health care coverage found that providing 
coverage of gender-affirming care had ``zero to very low costs.'' \446\ 
An

[[Page 37683]]

additional study comparing costs and potential savings associated with 
covering gender-transition-related care concluded that ``additional 
expenses hold good value for reducing the risk of negative endpoints--
HIV, depression, suicidality, and drug abuse'' and noted that 
``provider coverage was cost-effective in 85 percent of simulations.'' 
\447\ More recently, a 2021 survey of employers conducted by the Human 
Rights Campaign noted that most employers who covered gender-affirming 
care reported only ``marginal increases'' in cost, on the order of ``a 
fraction of a decimal point of cost calculations.'' \448\
---------------------------------------------------------------------------

    \439\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, p. 1 (Apr. 13, 2012), 
https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
    \440\ Id. at p. 3. More recent estimates indicate that a higher 
share of the population in the United States identifies as 
transgender (0.6 percent of the U.S. adult population). Andrew R. 
Flores et al., The Williams Inst., UCLA Sch. of Law, Race and 
Ethnicity of Adults Who Identify as Transgender in the United 
States, p. 2 (2016), https://williamsinstitute.law.ucla.edu/wp-content/uploads/Race-Ethnicity-Trans-Adults-US-Oct-2016.pdf.
    \441\ State of Cal., Dep't of Ins., Dep't of Ins., Economic 
Impact Assessment Gender Nondiscrimination in Health Insurance, p. 8 
(Apr. 13, 2012), https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
    \442\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, p. 9 (Apr. 13, 2012), 
https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
    \443\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, pp. 6-7 (Apr. 13, 
2012), https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
    \444\ Wis., Dep't of Employee Trust Funds, Correspondence 
Memorandum Re: Transgender Services Coverage, pp. 6-8 (Aug. 14, 
2018), https://etf.wi.gov/boards/groupinsurance/2018/08/22/item6a1/download?inline=.
    \445\ Aaron Belkin, Caring for Our Transgender Troops--The 
Negligible Cost of Transition-Related Care, 373 New Eng. J. Med. 
1089 (2015), https://www.nejm.org/doi/pdf/10.1056/NEJMp1509230?articleTools=true.
    \446\ Jody Herman, The Williams Inst., UCLA Sch. of Law, Cost 
and Benefits of Providing Transition-Related Health Care Coverage in 
Employee Health Benefits Plans: Findings from a Survey of Employers, 
p. 2 (Sept. 2013), https://williamsinstitute.law.ucla.edu/wp-content/uploads/Herman-Cost-Benefit-of-Trans-Health-Benefits-Sept-2013.pdf.
    \447\ William V. Padula et al., Societal Implications of Health 
Insurance Coverage for Medically Necessary Services in the U.S. 
Transgender Population: A Cost-Effectiveness Analysis, 31 J. of Gen. 
Internal Med. 394 (2015), https://pubmed.ncbi.nlm.nih.gov/26481647/.
    \448\ Hum. Rts. Campaign, Corporate Equality Index 2021 (2021), 
https://reports.hrc.org/corporate-equality-index-2021?_ga=2.206988627.1166715317.1639876655-819100514.1639876655.
---------------------------------------------------------------------------

    In recent years, some legal challenges to coverage exclusions have 
also considered issues of cost and concluded that covering gender-
affirming care does not significantly increase costs for plans. In 
discussing the parties' experts on the issue of the cost, one court 
noted that, ``[f]rom an actuarial perspective, there appears to be no 
dispute that the cost of coverage is immaterial.'' \449\ Another court 
reviewing expert testimony called any cost savings from excluding 
coverage for gender-affirming care ``both practically and actuarially 
immaterial.'' \450\
---------------------------------------------------------------------------

    \449\ Boyden v. Conlin, 341 F. Supp. 3d 979, 1000 (W.D. Wis. 
2018).
    \450\ Flack v. Wis. Dep't of Health Servs., 395 F. Supp. 3d 
1001, 1021 (W.D. Wis. 2019); see also Kadel v. Folwell, No. 1:19-cv-
00272, 2022 WL 2106270, at *22 (finding that the cost of covering 
gender-affirming care ``pales in comparison'' to the Defendant state 
health plan's overall cash balance and that excluding such coverage 
would only save each plan member' ``about one dollar each'').
---------------------------------------------------------------------------

    Based on the studies discussed above, we estimate that providing 
transgender individuals nondiscriminatory insurance coverage and 
treatment would have a small impact on the overall cost of care and on 
health insurance premiums in terms of the percentage of overall 
spending. We reiterate that the final rule does not mandate the 
provision or coverage of gender-affirming care, or any particular 
health service. However, to the extent a covered entity provides 
coverage for a particular health service, the covered entity must 
provide the health service to all individuals in a neutral, 
nondiscriminatory manner consistent with this rule. The utilization 
rate of covered services, whatever those services may be, is likely to 
be extremely low because transgender individuals represent a small 
minority in the general population and because not all transgender 
individuals will seek medical care in the course of their 
transition.\451\
---------------------------------------------------------------------------

    \451\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, pp. 2, 5 (Apr. 13, 
2012), https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
---------------------------------------------------------------------------

    As described in this section, the costs associated with gender-
affirming care are likely to be small on a percentage basis of total 
health care costs; however, when these estimates are combined with 
measures of overall health care spending, they would likely result in 
incremental costs that could be substantial. As an initial estimate, we 
pair the Belkin (2015) estimate of 0.012 percent of incremental health 
care costs with $4,255.1 billion in total health expenditures in 
calendar year 2021.\452\ When this is grown to 2022 dollars, total 
health care costs are $4,550.0 billion. Combining these yields our 
upper-bound estimate of $546 million in annual costs associated with 
additional coverage. As a lower-bound estimate, we adopt an assumption 
that these costs will be fully offset by reductions in spending on 
other medical care. This lower bound of $0 is broadly consistent with a 
cost-effectiveness analysis that includes the probability of negative 
incremental costs associated with coverage.\453\ For our primary 
estimate, we start with the midpoint of the lower-bound and upper-bound 
cost estimate of about $273.24 million annually. We reduce this figure 
by half to account for several factors, such as some covered entities 
already covering gender-affirming care under the baseline scenario. The 
coverage from Sec.  92.207(b)(1) through (5) and (6) have delayed 
applicability dates of the first day of the first plan year beginning 
on or after January 1, 2025. Therefore, there is no cost from coverage 
in year 1 (2024). This results in a primary estimate of about $138 
million per year starting in year 2 in incremental annual costs 
associated with additional coverage under the final rule, with a full 
range of cost estimates including $0 million and $546 million.
---------------------------------------------------------------------------

    \452\ U.S. Dep't of Health & Hum. Servs., Ctrs. for Medicare & 
Medicaid Servs., Table 19. National Health Expenditure Accounts: 
Methodology Paper, 2022, https://www.cms.gov/files/document/definitions-sources-and-methods.pdf.
    \453\ William V. Padula et al., Societal Implications of Health 
Insurance Coverage for Medically Necessary Services in the U.S. 
Transgender Population: A Cost-Effectiveness Analysis, 31 J. of Gen. 
Internal Med. 394 (2015), https://pubmed.ncbi.nlm.nih.gov/26481647/.
---------------------------------------------------------------------------

    In addition, health plans and issuers could incur overall costs if 
total health care utilization increases as a result of this final rule. 
Any potential increase in costs as a result of increased health care 
utilization as a result of decreased discrimination could be passed on 
to beneficiaries in the form of increased premiums. However, this cost 
would be minimal due to the low utilization of gender affirming care 
along with the availability of the services.
Assessing Decision Support Tools for Discrimination
    Section 92.210 sets a minimum requirement for each covered entity 
to make reasonable efforts to mitigate the risk of discrimination 
resulting from the covered entity's use of a decision support tool. 
This will impose a cost on covered entities to review for potential 
discrimination in their decision support tools and to then make 
reasonable steps to mitigate the risk of discrimination. To estimate 
the cost of review, the Department assumes that all covered entities, 
or 266,297 entities, would on average take 1 hour to review decision 
support tools in year 1 and 0.5 hours in each year 2-5. The Department 
assumes the time burden is halved after year 1 because entities would 
only be reviewing new decision support tools or changes made to 
preexisting ones in the past year. Evidence suggests that larger 
entities, such as insurers, health systems and national labs, are more 
likely to use decision support tools while some types of entities may 
not use them at all.\454\ It is therefore likely that entities will 
have a large variance in time burden in practice as some entities will 
need to spend more time reviewing and others much less. OCR assumes 
that the hour of review consists of a 1557 coordinator (SOC code 43-
4071) spending 0.5 hours coordinating a request for information on the 
potential for discrimination in decision support tools used by the 
covered entity and a Management Analyst (13-1111) or equivalent 
employee with knowledge of the decision support tools spending 0.5 
hours responding to that request. After adjusting for fringe benefits 
and other indirect costs, the hourly wages for the Management Analyst 
and Section 1557 Coordinator come to $100.64 and $38.04 respectively. 
We monetize the time spent on reviewing decision support tools by 
estimating a total cost per entity

[[Page 37684]]

of $69.34 ($100.64 x 0.5 + $38.04 x 0.5). The estimated total cost to 
review decision support tools for all covered entities is $18,465,034 
($69.34 x 266,297) in year 1. In years 2-5, OCR estimates that the time 
burden will be half of what it was in year 1. This will lead to a total 
cost per entity of $34.67 ($100.64 x 0.25 + $38.04 x 0.25) in years 2-
5. The estimated total cost to review decision support tools for all 
covered entities is $9,232,517 ($34.67 x 266,297) in each year 2-5.
---------------------------------------------------------------------------

    \454\ Xia Jing et al., Availability and Usage of Clinical 
Decision Support Systems (CDSSs) in Office-Based Primary Care 
Settings in the USA, BMJ Health Care Inform. (2019), https://pubmed.ncbi.nlm.nih.gov/31818828.
---------------------------------------------------------------------------

    If an entity reviews their decision support tools and determines 
that there is no evidence that use of the tools may result in 
discriminatory outputs, then it is likely that no further action will 
be taken, and no additional cost will be incurred. If the entity 
determines that there is evidence that the decision support tools used 
by the covered entity could result in discriminatory outputs, then the 
entity will have to make reasonable mitigation steps to be in 
compliance with the final rule. OCR has determined that there are a 
large variety of actions that a covered entity can take to satisfy the 
requirements of the final rule and that these steps likely depend on 
the specific scenario. One aspect that will affect what a covered 
entity would do is if the decision support tool that is being used is a 
third-party product that the covered entity pays for or was developed 
and is owned by the covered entity itself. In the first scenario, the 
covered entity could notify the third party that the decision support 
tool may result in outputs that could be in violation of the rule, take 
mitigation steps in the use of the tool to ensure decisions made using 
that tool account for the potential for bias, or switch to a different 
product if the cost to do so is not prohibitive. If the covered entity 
maintains their own decision support tool, then they might take time to 
update the decision support tool, change policies and procedures about 
its use, or take other reasonable mitigation measures to ensure that it 
is not used in a discriminatory manner. The cost of all these actions 
may vary greatly, and OCR does not have data to assess what the costs 
may be. Generally, OCR assumes that larger entities, such as 
multihospital health systems and insurers will have a higher cost to 
resolve these issues since they are more likely to use decision support 
tools.\455\ In addition, OCR does not have data on how likely any given 
decision support tool is to be discriminatory and therefore necessitate 
taking reasonable mitigation steps. Due to these data limitations, OCR 
does not quantify the cost of taking reasonable mitigation steps.
---------------------------------------------------------------------------

    \455\ Robert. S. Rudin & Shira H. Fischer, Trends in the Use of 
Clinical Decision Support by Health System-Affiliated Ambulatory 
Clinics in the United States 2014-2016, Am. J. of Accountable Care 
(2019), https://www.ajmc.com/view/trends-in-the-use-of-clinical-decision-support-by-health-system-affiliated-ambulatory-clinics-in-the-united-states-20142016.
---------------------------------------------------------------------------

Exemption Requests
    We also identify a cost related to covered entities submitting a 
request for assurance of an exemption based on Federal conscience or 
religious freedom laws. We model this potential cost associated with 
exemption assurance requests as the time spent by covered entities to 
(a) assess the need for an exemption; (b) write the exemption assurance 
request; and (c) submit such a request to OCR. As an initial 
calculation, we assume that this would involve two (2) employees 
spending two (2) hours each assessing the need for an exemption and one 
employee spending three (3) hours writing and submitting the exemption 
assurance request to OCR. We further assume that legal personnel, 
including lawyers and legal assistants, would perform these functions. 
The mean hourly wage for these occupations is $70.55 per hour for each 
employee, which we double to account for overhead and other indirect 
costs. We multiply these factors together and estimate the cost per 
exemption request of $987.70 ($141.10 x 7 = $70.55 x 2 x 7).
    OCR has revised the estimate of the number of religious exemptions 
from the Proposed Rule RIA, which assumed 27 religious exemptions. OCR 
has increased this estimate to provide a more conservative estimate of 
the cost of religious exemptions, given significant uncertainty in the 
number of requests that will be submitted. OCR revises its assumptions 
to assume that 707 religious hospitals and 2 percent of all other 
covered entities will request assurance of religious exemptions. This 
results in a total of 6,019 of such requests (707 + ((266,297-707) x 
0.02)) in the first year. OCR estimates the cost to covered entities 
for the 6,019 of such requests as $5,944,792 (6,019 x $987.73).
    We estimate the cost to OCR comprising the time it would take to 
review the request and determine if the exemption assurance should be 
given. We estimate that it would take a single lawyer equivalent 
employee (Occupation code 23-1011), with a wage of $70.55 per hour, 3 
hours to complete this review. We double the mean hourly wage to 
account for overhead and fringe benefits. OCR estimates the cost to 
review 6,019 assurance of exemption requests as $2,547,768 ($141.10 x 3 
x 6,019). The total estimated cost of this process is $8,492,559.
c. Total Quantified Costs
    Table 4 below presents the total annual costs anticipated under the 
final rule for which estimates have been developed. For the purposes of 
this analysis, we assume that the regulatory requirements begin to take 
effect in the middle of 2024. In the first year under the final rule, 
these estimated costs include $927.4 million in training, $8.5 million 
to process religious assurance of exemption requests, $18.5 million to 
review decision support tools, and $65.0 million to revise policies and 
procedures. For all years in the analysis, we estimate recurring costs 
of $46.6 million related to notices. We estimate a first-year cost of 
$37 million related to documentation, with ongoing costs in future 
years of $10.1 million. We also report a primary recurring cost 
estimate of $136.6 million associated with coverage of gender-affirming 
care starting in year 2 and $9.2 million in reviewing decision support 
tools starting in year 2. The total costs in year 1 amount to $1,102.9 
million, with ongoing annual costs of $511.7 million in subsequent 
years.

                                 Table 4--Primary Estimate of Total Annual Costs
                                           [$ Millions, 2022 dollars]
----------------------------------------------------------------------------------------------------------------
                  Cost element                       2024         2025         2026         2027         2028
----------------------------------------------------------------------------------------------------------------
Training.......................................       $927.4       $309.1       $309.1       $309.1       $309.1
Policies and Procedures........................         65.0          0.0          0.0          0.0          0.0
Notices........................................         46.6         46.6         46.6         46.6         46.6
Documentation..................................         37.0         10.1         10.1         10.1         10.1
Gender-affirming Care Coverage.................            0        136.6        136.6        136.6        136.6

[[Page 37685]]

 
Assurance of Exemption Requests................          8.5          0.0          0.0          0.0          0.0
Decision Support Tool Review...................         18.5          9.2          9.2          9.2          9.2
                                                ----------------------------------------------------------------
    Total Costs *..............................      1,102.9        511.7        511.7        511.7        511.7
----------------------------------------------------------------------------------------------------------------

    This rulemaking also revises the Department's interpretation of 
whether Medicare Part B payments constitute Federal financial 
assistance by answering that question in the affirmative. Thus, the 
requirements of section 1557 and other civil rights statutes apply to 
entities that receive payments through Medicare Part B. We are 
currently unable to quantify the number of covered entities that are 
enrolled in Medicare Part B but that receive no other forms of Federal 
financial assistance. The 2016 Rule discussed several of the challenges 
associated with estimating the number of these entities. For example, 
the 2016 Rule notes that, ``although we have data, by program, for the 
number of physicians receiving payment from each program, there is no 
single, unduplicated count of physicians across multiple programs.'' We 
adopt the finding of the 2016 Rule that almost all practicing 
physicians were likely covered by the rule because they accept Federal 
financial assistance from sources other than Medicare Part B.\456\
---------------------------------------------------------------------------

    \456\ 81 FR 31375, 31445-46 (May 18, 2016).
---------------------------------------------------------------------------

3. Discussion of Benefits
    Quantifying benefits for this final rule presents significant 
challenges. One notable challenge relates to attribution: several 
sources of benefits discussed in the preambles of the 2016 and 2020 
Rules overlap with and may be attributable to prior existing civil 
rights regulation, to the ACA rather than the 2016 and 2020 rulemakings 
that implement section 1557, or to nondiscrimination policies based on 
State law or institutional policies prohibiting discrimination 
generally.
    A second challenge relates to identifying a quantitative 
relationship between nondiscrimination policies and important outcomes 
such as improvements in public health outcomes. For example, we 
anticipate that this regulation would reduce the incidence of providers 
refusing to treat patients based on the patient's gender identity. This 
would result in fewer instances of delayed or denied care, which in 
turn would lead to reductions in mortality and morbidity risks. 
However, we are not able to estimate the changes in the magnitude of 
these discriminatory events that would be attributable to the final 
rule, and thus are unable to quantify or monetize these health 
improvements. Similarly, we anticipate that the final rule will result 
in other sources of benefits that we are unable to quantify. These 
include a reduction in suicidal ideation and attempts, improvements to 
mental health, reductions in substance use, and generally align with a 
discussion of the economic impacts of a California regulation relating 
to gender nondiscrimination in health insurance.\457\
---------------------------------------------------------------------------

    \457\ State of Cal., Dep't of Ins., Economic Impact Assessment 
Gender Nondiscrimination in Health Insurance, pp. 9-11 (Apr. 13, 
2012), https://translaw.wpengine.com/wp-content/uploads/2013/04/Economic-Impact-Assessment-Gender-Nondiscrimination-In-Health-Insurance.pdf.
---------------------------------------------------------------------------

    In addition to these health improvements, we anticipate benefits to 
covered entities from additional regulatory clarity on how OCR will 
enforce the ACA's nondiscrimination protections, particularly in light 
of ongoing litigation related to the 2020 Rule, interpretation of the 
Supreme Court's Bostock decision, and the Department's Bostock 
Notification. The training provisions represent one mechanism by which 
the final rule would reduce discriminatory events. This would, in turn, 
reduce the number of enforcement actions, representing a potential 
cost-saving benefit for covered entities. We also anticipate benefits 
to covered entities from the establishment of a grievance process, 
which would reduce the number of complaints filed with OCR, though this 
may be offset somewhat from covered entities with fewer than 15 
employees referring complaints to OCR in lieu of adopting their own 
grievance procedure.
    We also anticipate that beneficiaries could benefit from reduced 
obstacles to accessing health care, including fewer language barriers 
and a reduction in discriminatory behavior related to sexual 
orientation and gender identity, resulting in a potential increase in 
overall health care utilization. These benefits relate to individuals' 
ability to access care and the quality of care they receive. For 
example, the provisions related to language access for individuals with 
LEP and accessibility for individuals with disabilities could reduce 
instances of negative outcomes, including death, due to a lack of 
understanding between patient and doctor or between patient and 
pharmacist, as well as lack of access to services. We also anticipate 
that the process by which individuals and recipients may seek assurance 
of an exemption based on Federal conscience or religious freedom laws 
will result in benefits from reduced litigation, which we do not 
capture in the benefit analysis. In addition, the prohibition on 
discrimination through the use of decision support tools is also likely 
to have a direct benefit on the health of individuals who are suffering 
from delayed or denied medical care due to discriminatory application 
of decision support tools. An example of this would be an incorrect 
diagnosis for skin cancer for a Black patient, which could lead to 
greater medical costs in the future and negative health outcomes for 
the patient.\458\ Furthermore, the positive effects of using decision 
support tools, such as identifying those at risk for cardiovascular 
disease at an earlier date, will be a benefit across populations 
experiencing discrimination.\459\
---------------------------------------------------------------------------

    \458\ Thomas Grote & Geoff Keeling, On Algorithmic Fairness in 
Medical Practice, Cambridge Quarterly of Healthcare Ethics, January 
2022. https://pubmed.ncbi.nlm.nih.gov/35049447/.
    \459\ Rachel Gold et al., Effect of Clinical Decision Support at 
Community Health Centers on the Risk of Cardiovascular Disease: A 
Cluster Randomized Clinical Trial, JAMA Network Open (2022), https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2788645.
---------------------------------------------------------------------------

4. Analysis of Regulatory Alternatives to the Final Rule
    The Department considered various alternatives while developing 
this regulation, including adopting the compliance timeline of the 
Proposed Rule. As discussed in the preamble, the final rule will allow 
additional time for covered entities to comply with certain procedural 
requirements, as compared to the timeline of the Proposed Rule. For 
example, covered entities must comply with the Sec.  92.9 Training 
requirements by no later than 300 days of effective

[[Page 37686]]

date. This revised timeline will postpone certain costs incurred by 
covered entities; however, since this analysis reports annual impacts, 
the revised timeline does not affect the quantified cost estimates. 
This section discusses several other alternatives OCR considered.
    The Department analyzed several regulatory alternatives to the 
final rule related to the notice requirements. The first alternative 
considered retaining the 2020 Rule's repeal of the notices and taglines 
provisions. The Department considered concerns raised in response to 
the 2016 Rule notice and tagline requirements, as well as concerns 
raised in response to the removal of those requirements in the 2020 
Rule. Though the Department acknowledges the burden placed on covered 
entities through the 2016 Rule notice requirements, the Department 
believes the 2020 Rule did not adequately consider the confusion and 
uncertainty placed on individuals or the unnecessary ambiguity that 
covered entities face by the 2020 Rule's repeal of the notices and 
taglines provisions in their entirety. As described earlier, we 
estimate that these provisions under the final rule would cost covered 
entities, as an aggregate, $46.6 million for each year. While excluding 
the provisions relating to the notices would reduce the cost of the 
final rule by $46.6 million, the Department rejected this option 
because it believes that the final provisions strike an appropriate 
balance between providing greater access for beneficiaries, while 
maximizing efficiency and economies of scale for covered entities.
    The second alternative considered by the Department would require 
covered entities to provide notices only at their first encounter with 
a beneficiary. For this alternative, we adopt the quantity and cost 
estimates associated with eligibility and enrollment communication 
included in Table 5 above. Under our primary cost scenario, this policy 
alternative would result in annual costs of notices of $0.7 million, 
which is about $45.9 million lower than the final rule. The Department 
rejected this option however, because this policy alternative, while 
posing a significantly reduced cost and burden on covered entities, 
would be too narrow and substantially reduce the information available 
to beneficiaries, likely resulting in beneficiaries not being aware of 
their civil rights, including whether they have experienced a 
prohibited discriminatory practice by a covered entity.
    The third alternative considered by the Department would require a 
more expansive notice provision, extending the requirements to include 
pharmacy-related notices. For this alternative, we adopt the 2020 RIA 
estimate of 3.2 billion annual pharmacy-related notices. This would 
result in $169.7 million in costs per year, or an increase of $123.1 
million compared to the final rule. While this alternative related to 
notices would increase the number of notices available to 
beneficiaries, and therefore increase beneficiaries' opportunity to 
receive information regarding nondiscrimination and civil rights 
protections, the Department believes this alternative would neither 
address nor remedy the burden placed on covered entities through the 
2016 Rule notice requirements. For this reason, the Department rejected 
this alternative.
    Finally, the Department also considered not including a process for 
covered entities to submit a request for assurance of a religious or 
conscience exemption. As described in the cost section, we estimate 
that this policy alternative would reduce the quantified costs by $8.5 
million. The Department did not choose this alternative because of its 
obligations to enforce a range of statutory protections, including 
Federal religious freedom and conscience laws. OCR remains committed to 
educating patients, providers, and other covered entities about their 
rights and obligations under these statutes, to protecting patients' 
health and dignity, and to providing a clear administrative process 
that respects the right to raise objections to the provision of certain 
kinds of care.
    We have not quantified the benefits associated with this 
information for the final rule or for these policy alternatives.
    Table 5 reports the total costs of these policy alternatives in 
present value and annualized terms, adopting a 3 percent and 7 percent 
discount rate. Table 6 reports the difference between the total cost of 
the alternatives compared to the provisions of the final rule, using 
the same accounting methods and discount rates. All estimates are 
presented in millions of year-2022 dollars, using 2024 as the base year 
for discounting.

                              Table 5--Total Cost of Policy Alternatives Considered
                                           [$ Millions, 2022 dollars]
----------------------------------------------------------------------------------------------------------------
                                                           Present value                    Annualized
         Accounting method discount rate         ---------------------------------------------------------------
                                                        3%              7%              3%              7%
----------------------------------------------------------------------------------------------------------------
Final Rule......................................        $2,917.6        $2,650.8          $637.1          $646.5
Alternative 1: No Notice Provision..............         2,704.1         2,459.7           590.5           599.9
Alternative 2: Single Notice Provision..........         2,707.4         2,462.6           591.2           600.6
Alternative 3: Pharmacy-Related Notices.........         3,481.3         3,155.4           760.1           769.6
Alternative 4: No Exemption Provision...........         2,909.4         2,642.8           635.3           644.6
----------------------------------------------------------------------------------------------------------------


                                Table 6--Comparison of Alternatives to Final Rule
                                           [$ Millions, 2022 dollars]
----------------------------------------------------------------------------------------------------------------
                                                           Present value                    Annualized
         Accounting method discount rate         ---------------------------------------------------------------
                                                        3%              7%              3%              7%
----------------------------------------------------------------------------------------------------------------
Alternative 1: No Notice Provision..............         -$213.5         -$191.1          -$46.6          -$46.6
Alternative 2: Single Notice Provision..........          -210.2          -188.2           -45.9           -45.9
Alternative 3: Pharmacy-related Notices.........           563.7           504.6           123.1           123.1
Alternative 4: No Exemption Provision...........            -8.2            -7.9            -1.8            -1.9
----------------------------------------------------------------------------------------------------------------


[[Page 37687]]

    The Department also considered whether to require covered entities 
to collect the self-identified race, ethnicity, primary language 
(spoken and written), sex (consistent with the categories of sex 
discrimination described at Sec.  92.101(a)(2)), age, and disability 
status data for beneficiaries in any health program or activity. The 
Department believes, however, that our current authorities under 
section 1557, title VI, section 504, title IX, and the Age Act already 
provide us the ability to collect these data to ensure compliance.\460\
---------------------------------------------------------------------------

    \460\ See, e.g., 45 CFR 80.6, 86.71, 91.34, and 84.61.
---------------------------------------------------------------------------

B. Regulatory Flexibility Act--Final Small Entity Analysis

    The RFA requires agencies issuing a regulation to analyze options 
for regulatory relief of small businesses if a rule will have a 
significant impact on a substantial number of small entities. The RFA 
generally defines a ``small entity'' as:
    (1) A proprietary firm meeting the size standards of the Small 
Business Administration (SBA);
    (2) A nonprofit organization that is not dominant in its field; or
    (3) A small government jurisdiction with a population of less than 
50,000 (States and individuals are not included in the definition of 
``small entity'').
    OCR uses as its measure of significant economic impact on a 
substantial number of small entities a change in revenues of more than 
3 percent for 5 percent or more of affected small entities. In 
instances where OCR judged that the final rule would have a significant 
impact on a substantial number of small entities, we considered 
alternatives to reduce the burden. To accomplish our task, we first 
identified all the small entities that may be impacted, and then 
evaluated whether the economic burden we determined in the RIA 
represents a significant economic impact.
1. Entities That Will Be Affected
    OCR has traditionally classified most providers as small entities 
even though some nonprofit providers would not meet the definition of 
``small entity'' were they proprietary firms. Nonprofit entities are 
small if they are independently owned and operated and are not dominant 
in their fields. The CMS Provider of Service file has indicators for 
profit and nonprofit entities, but these have proven to be unreliable. 
The Census data identifies firms' tax status by profit and non-profit 
status but only reports revenues and does not report them by the profit 
and non-profit status of the entity.
a. Physicians
    One class of providers we do not automatically classify as small 
businesses is physician practices. Physician practices are businesses 
and therefore are ``small'' if they meet the SBA's definition. The 
current size standard for physicians (excluding mental health 
specialists) (North American Industry Classification System code 62111) 
is annual receipts of less than $16 million.\461\ Using the Census data 
showing the number of firms, employees and payroll, we selected 
physicians that reported fewer than 20 employees as the top end for 
small physician offices. This equaled 16,361 entities or 9.8 percent of 
all physician offices defined as ``large.'' This left 150,933 offices 
or 90.2 percent as ``small.'' \462\
---------------------------------------------------------------------------

    \461\ U.S. Small Business Admin., Table of Small Business Size 
Standards Matched to North American Industry Classification System 
Codes, Small Business Administration (March 2023), https://www.sba.gov/document/support-table-size-standards.
    \462\ Physician practices may earn more than $16 million per 
year and that would increase the number of ``large'' practices in 
the analysis. But as we will later show, large practices will have 
proportionally larger workforce staff that must be excluded from the 
analysis.
---------------------------------------------------------------------------

b. Pharmacies
    Pharmacies also are businesses, and the size standard for them is 
annual receipts of less than $37.5 million. According to Census 
Statistics of U.S. Businesses, there are 19,346 pharmacy and drug store 
firms (North American Industry Classification System code 456110). 
Because of the lack of revenue or receipt data for pharmacies, we are 
unable to estimate the number of small pharmacies based on the SBA size 
standard. However, using the number of employees taken from the 
Statistics of U.S. Businesses as a proxy for revenues, the data is 
divided by number of employees per firm and shows the number of 
employers with fewer than 20 employees and those with more than 20 
employees.\463\ There are 17,160 pharmacy firms with fewer than 20 
employees, representing 88.7 percent of the total number of pharmacy 
firms. It seemed reasonable to assume that firms with fewer than 20 
employees satisfy the SBA size standard and thus we accepted that the 
number of small pharmacy firms equaled 17,160. As with the number of 
small physician offices, our method can only identify the minimum 
number of ``small'' pharmacies that meet the SBA size standard. We 
cannot determine the actual number of ``small'' pharmacies.
---------------------------------------------------------------------------

    \463\ U.S. Census Bureau, Statistics of U.S. Businesses, https://www.census.gov/programs-surveys/susb.html.
---------------------------------------------------------------------------

c. Health Insurance Issuers
    Another class of covered entities that are business enterprises is 
health insurance issuers. The SBA size standard for health insurance 
issuers is annual receipts of $47 million. Based on the analysis below, 
we conclude that there are few small health insurance issuers.
    In 2021, there were 483 issuers in the U.S. health insurance 
market.\464\ Health insurance issuers are generally classified under 
the North American Industry Classification System (NAICS) code 524114 
(Direct Health and Medical Insurance Carriers). According to SBA size 
standards,\465\ entities with average annual receipts of $47 million or 
less are considered small entities for this NAICS code. The Departments 
expect that few, if any, insurance companies underwriting health 
insurance policies fall below these size thresholds. Due to the lack of 
recent Census data based on enterprise receipt size, HHS used the 
Census 2017 SUSB data as a proxy since it was the last year in which 
this data is available. Based on data from SUSB annual report 
submissions for the 2017 SUSB reporting year, approximately 443 out of 
745 issuers of health insurance coverage nationwide, approximately 
59.46%, had total premium revenue of $40.0 million or less.\466\ OCR 
decided to use a value slightly higher than the 2017 SBA standard to 
account for slight changes in the industry in addition to inflation. We 
then apply this percentage to the current number of insurance Issuers 
to estimate the number of small entities for the business type, which 
is approximately 517 of 869 entities. However, this estimate may 
overstate the actual number of small health insurance issuers that may 
be affected due to changes in the health care industry since 2017. To 
produce a conservative estimate, for the purposes of this analysis, the 
Departments assumes 59.5 percent, or 517 issuers are considered small 
entities.
---------------------------------------------------------------------------

    \464\ U.S. Health & Hum. Servs., Ctrs. for Medicare & Medicaid 
Servs. (2022), Medical Loss Ratio Data and System Resources, https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr.
    \465\ U.S. Small Business Admin., Table of Size Standards (March 
17, 2023), https://www.sba.gov/document/support--table-size-standards.
    \466\ U.S. Health & Hum. Servs., Ctrs. for Medicare & Medicaid 
Servs., Medical Loss Ratio Data and System Resources (2017), https://www.cms.gov/marketplace/resources/data/medical-loss-ratio-data-systems-resources.
---------------------------------------------------------------------------

d. Local Government Entities
    We also excluded local governmental entities from our count of 
small entities

[[Page 37688]]

because we lack the data to classify them by populations of fewer than 
50,000. The following table shows the number of small, covered entities 
we estimated could be affected by the final rule.

                         Table 8--Small Entities
------------------------------------------------------------------------
          NAICS code                 Business type        Small entities
------------------------------------------------------------------------
62142........................  Outpatient mental health            7,649
                                and substance abuse
                                centers.
621491.......................  HMO medical centers......              84
621492.......................  Kidney dialysis centers..             449
621493.......................  Freestanding ambulatory             4,554
                                surgical and emergency
                                centers.
621498.......................  All other outpatient care           6,307
                                centers.
6215.........................  Medical and diagnostic              7,200
                                laboratories.
6216.........................  Home health care services          25,718
6219.........................  All other ambulatory                7,091
                                health care services.
62321........................  Residential intellectual            6,674
                                and developmental
                                disability facilities.
6221.........................  General medical and                 2,445
                                surgical hospitals.
6222.........................  Psychiatric and substance             434
                                abuse hospitals.
6223.........................  Specialty (except                     301
                                psychiatric and
                                substance abuse)
                                hospitals.
6231.........................  Nursing care facilities             9,824
                                (skilled nursing
                                facilities).
45611........................  Pharmacies and drug                17,160
                                stores.
6211.........................  Offices of physicians....         150,933
524114.......................  Insurance Issuers........             517
                               Navigator grantees.......              58
                                                         ---------------
                                  Total Entities........         247,398
------------------------------------------------------------------------

2. Whether the Rule Will Have a Significant Economic Impact on Covered 
Small Entities
    The Department generally considers a rule to have a significant 
impact on a substantial number of small entities if it has at least a 3 
percent impact on revenue on at least 5 percent of small entities. We 
performed a threshold analysis to determine whether the quantified 
impacts of the final rule will exceed these thresholds. As described 
earlier in this analysis, we estimate the total annualized costs of the 
final rule would be about $637.1 million. Dividing these total costs by 
the 247,398 small entities gives a cost per entity of $2,575. This cost 
estimate would only exceed the 3 percent ``significant impact'' 
threshold on revenue for any covered small businesses with revenue 
below $85,836. We conclude that very few small businesses covered by 
the final rule will have revenues below $85,836, and that this number 
is very likely to be smaller than the 5 percent ``substantial number'' 
threshold.
    As an additional consideration, we note that the costs of the final 
rule are mostly proportional to the size of the covered entity. For 
example, the costs associated with training, which account for more 
than 70 percent of the total costs of the final rule, are mostly 
proportional to the number of employees receiving training. In the main 
analysis, we estimate an incremental impact of one (1) hour per 
employee trained. The opportunity cost of training each employee 
represents 0.05 percent of a full-time employee's annual labor 
productivity, assuming a full-time employee works 2,080 hours per 
year.\467\ This finding, that the cost of training represents 0.05 
percent of the share of employees receiving training, is constant 
across firm size.
---------------------------------------------------------------------------

    \467\ 40 hours per week x 52 weeks = 2,080 hours. 0.05% = 0.0005 
= 1 hour / 2080 hours.
---------------------------------------------------------------------------

    Because the costs of the final rule are small relative to the 
revenue of covered entities, including covered small entities, and 
because even the smallest affected entities would be unlikely to face a 
significant impact, we certify that the final rule will not have a 
significant economic impact on a substantial number of small entities.

C. Executive Order 12250 on Leadership and Coordination of 
Nondiscrimination Laws

    Pursuant to E.O. 12250, the Department of Justice has the 
responsibility to ``review . . . proposed rules . . . of the Executive 
agencies'' implementing nondiscrimination statutes such as section 1557 
``in order to identify those which are inadequate, unclear or 
unnecessarily inconsistent.''The Department of Justice has reviewed and 
approved this final rule.

D. Paperwork Reduction Act

Information Collection Requirements
    This final rule contains information collection requirements (ICRs) 
that are subject to review by the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act (PRA) of 1995.\468\ In order to 
evaluate whether an information collection should be approved by OMB, 
the PRA requires that the Department solicits comment on the following 
issues:
---------------------------------------------------------------------------

    \468\ 44 U.S.C. 3501-3520.
---------------------------------------------------------------------------

    1. Whether the information collection is necessary and useful to 
carry out the proper functions of the agency;
    2. The accuracy of the agency's estimate of the information 
collection burden;
    3. The quality, utility, and clarity of the information to be 
collected; and
    4. Recommendations to minimize the information collection burden on 
the affected public, including automated collection techniques.\469\
---------------------------------------------------------------------------

    \469\ 44 U.S.C. 3506(c)(2)(A).
---------------------------------------------------------------------------

    The PRA requires consideration of the time, effort, and financial 
resources necessary to meet the information collection requirements 
referenced in this section. The Department previously published a 
notice of a proposed data collection on August 4, 2022, at 87 FR 47907-
08, as part of an NPRM entitled ``Nondiscrimination in Health Programs 
and Activities'' (RIN 0945-AA17), to invite public comment. OCR 
solicited comment on the issues listed above for the sections that 
contain ICRs. The following paragraphs describe these provisions, with 
an estimate of the annual burden, summarized in Table 1. OCR did not 
receive comments related to the previous notice but has adjusted the 
estimated respondent burden in this request to reflect revised 
assumptions based on updated information available at the time of the 
final rule's

[[Page 37689]]

publication. This revision resulted in adjusted cost estimates that are 
consistent with the RIA presented in this final rule. The estimates 
covered the employees' time for reviewing and completing the 
collections required.
    Consistent with the NPRM, the collections of information proposed 
by this final rule relate to Sec. Sec.  92.5 (Assurances required); 
92.7 (Designation and responsibilities of a Section 1557 Coordinator); 
92.9 (Training); 92.10 (Notice of nondiscrimination); and 92.11 (Notice 
of availability of language assistance services and auxiliary aids and 
services). Respondents to this proposed information collection would 
include a variety of covered entities with a health program or activity 
including hospitals, ambulatory surgical centers, skilled nursing 
facilities, and physicians' offices. For a more detailed discussion 
concerning the potential costs' implications related to these 
collections of information, please see the Regulatory Impact Analysis.
1. ICRs Regarding Assurances (Sec.  92.5)
    Section 92.5 retains the assurances obligations from the 2016 and 
2020 Rules for covered entities to submit an assurance of compliance to 
the Department. As stated in the NPRM, OCR has previously obtained PRA 
approval (OMB control # 0945-0008) for this reporting requirement via 
an update to HHS Form 690 (Consolidated Civil Rights Assurance Form), 
separate from this rulemaking. The requirement to sign and submit an 
assurance of compliance currently exists under section 1557 and other 
civil rights regulations (title VI, section 504, title IX, and the Age 
Act). Since the Department provides an online portal through which 
covered entities submit attestation of Assurance of Compliance, the 
Department has determined that this requirement imposes no additional 
reporting or recordkeeping requirements under the PRA.
    OCR did not receive any comments in response to the ICRs related to 
this policy. Please see the prior preamble discussion for our responses 
to the general comments related to this provision. OCR is finalizing 
this ICR as proposed.
2. ICRs Regarding Section 1557 Coordinator (Sec.  92.7) and Training 
(Sec.  92.9)
    Section 92.7 requires covered entities with 15 or more employees 
designate a section 1557 Coordinator to coordinate their efforts to 
comply with and carry out their responsibilities under section 1557. 
The burden to coordinate efforts to comply with and carry out the 
responsibilities under section 1557 was estimated in the NPRM, at an 
annualized burden of 10 hours per covered entity to store complaints 
and the associated records required under Sec.  92.8(c)(2) each year. 
We assumed that administrative or clerical support personnel would 
perform these functions. The mean hourly wage for this occupation was 
$17.38 per hour, which we double to account for overhead and other 
indirect costs. In the 2022 NPRM, OCR estimated the number of covered 
entities with more than 15 employees to be approximately 15 percent or 
41,250. Although in the 2022 NPRM, OCR estimated that the costs of 
retaining records related to grievances filed at all covered entities 
would be $14.3 million annually (($17.38 x 2) x 10 x 41,250), we noted 
that this estimation approach may overstate the costs if many covered 
entities already retain complaint information.
    OCR has adjusted our estimated respondent burden in this request to 
reflect baseline conditions based on updated information available at 
the time of the final rule's publication. No changes were made to 
estimated personnel or staff time or to the assumption that 
administrative or clerical support personnel would perform these 
functions. The mean hourly wage for this occupation, however, has 
increased to $19.02 per hour, which we double to account for overhead 
and other indirect costs. The Department estimates the number of 
covered entities with more than 15 employees to be approximately 15 
percent or 63,950. Although we estimate the costs of retaining records 
related to grievances filed at all covered entities would be $24.3 
million annually (($19.02 x 2) x 10 x 63,950)), this estimation 
approach will overstate the costs if many covered entities already 
retain complaint information.
    The burden for documenting employee training as required under 
Sec.  92.9(c) is the cost of covered entity staff time to (a) create 
training attendance forms; and (b) store the training sign-up sheet. 
The labor cost would include one (1) employee spending 15 minutes (0.25 
hours) to create the sign-up sheet during the first year and one (1) 
employee spending one (1) hour collecting and storing the attendance 
forms the first year and in subsequent years. In the NPRM, we estimated 
that administrative or clerical support personnel would perform these 
functions. The mean hourly wage for this occupation was $17.38 per 
hour. The labor cost was $6.0 million in the first year (($17.38 x 
1.25) x 275,002 covered entities). In the 2022 NPRM, we estimated that 
the cost in subsequent years would be $4.8 million, which would 
represent an annual allotment of one (1) hour (($17.38 x 1) x 275,002 
covered entities).
    OCR has adjusted our estimated respondent burden in this request to 
reflect updated baseline conditions based on updated information not 
available at the time of the publication of the NPRM. No changes were 
made to the estimated personnel or staff time or to the estimate that 
administrative or clerical support personnel would perform these 
functions. The mean hourly wage for this occupation, however, increased 
to $19.02 per hour. The estimated labor cost of documenting employee 
training would be $12.6 million in the first year (($19.02 x 2) x 1.25 
x 266,297 covered entities). We estimate that the cost in subsequent 
years would be $10.1 million, which would represent an annual allotment 
of one (1) hour ((($19.02 x 2) x 1) x 266,297 covered entities).
    OCR did not receive any comments in response to the ICRs related to 
this policy. Please see the prior preamble discussion for our responses 
to the general comments related to this provision. OCR is finalizing 
these ICRs as proposed.
3. ICRs Regarding Notice of Nondiscrimination (Sec.  92.10) and Notice 
of Availability of Language Assistance Services and Auxiliary Aids and 
Services (Sec.  92.11)
    Under Sec. Sec.  92.10 and 92.11, OCR requires covered entities to 
notify the public of their nondiscrimination requirements, as well as 
the availability of language assistance services and auxiliary aids and 
services.
    Section 92.10 requires covered entities to provide a Notice of 
Nondiscrimination relating to its heath programs or activities to 
beneficiaries of its health programs and activities and members of the 
public. To minimize the burden on covered entities, the provision 
proposes a covered entity may combine the content of the notice 
required by this section with the notice required by title VI, section 
504, title IX, and the Age Act implementing regulations.
    Section 92.11 requires covered entities to notify the public of 
their nondiscrimination requirements, as well as the availability of 
language assistance services and auxiliary aids and services. A covered 
entity must provide a Notice of Availability that, at minimum, states 
that the covered entity provides language assistance services and 
auxiliary aids and services free of charge

[[Page 37690]]

in its health programs and activities, in compliance with section 1557. 
This notice must be provided to beneficiaries of the covered entity's 
health program or activity and members of the public. The notice must 
be provided in English and at least the top 15 languages spoken by 
persons with LEP of the relevant State or States in which a covered 
entity operates (including territories) and must be provided in 
alternate formats for individuals who request auxiliary aids and 
services to ensure effective communication.
    OCR also received comments on the cost of Notices of 
Nondiscrimination and Notices of Availability (referred to as 
``taglines'' in the 2016 and 2020 Rules). One commenter explained how 
the cost of including taglines averages up to $8.91 per month per 
covered entity and upwards of $2 million a year for the health 
insurance industry. Another commenter stated that they have spent over 
$16 million on notices and taglines since 2016, and estimate that they 
have spent over $3 million in 2022 alone. As we noted in the RIA, 
neither commenter provided sources for their data nor additional detail 
on their cost estimates. Another commenter noted that previous 
complaints on the frequency and volume of materials related to the 
notice and tagline sections of the rule were not addressed, but no data 
were provided with their comment.
    Based on costs estimated in the RIA, OCR derives a monthly cost of 
Notices of Nondiscrimination and Notices of Availability from $21.28 
and $26.60 per entity depending on the prevalence of electronic 
delivery. These cost estimates include the total Notices of 
Nondiscrimination and Notices of Availability and therefore OCR finds 
the commenter's estimate of $8.91 per month for Notices of Availability 
as plausible and consistent with the estimates in the RIA. OCR also 
notes that these cost estimates are averages. It is expected that some 
entities, including larger entities, may have higher than average costs 
due to the increased number of notices they would send to individuals.
    Both types of notices are required (1) on an annual basis; (2) upon 
request; (3) at a conspicuous location on the homepage of the covered 
entity's health program or activity website; and (4) at conspicuous 
physical locations where the health program or activity interacts with 
the public.
    In the NPRM, OCR estimated the burden for responding to the 
proposed notice requirements would be 34 minutes and that 
administrative or clerical support personnel would perform these 
functions. Because it was difficult to determine the exact number of 
communications that would be required to contain the notices 
anticipated under the 2022 NPRM, our cost estimates reflected a wide 
range of uncertainty in the cost. In the 2022 NPRM, the Department 
estimated an adjusted annual primary cost total of $4.5 million, with a 
range of costs between $2.7 million and $25.0 million. These costs 
would occur in each year of the time horizon of the analysis.
    OCR has adjusted our estimated respondent burden in this request to 
reflect updated baseline conditions based on updated information not 
available at the time of the publication of the NPRM. Because it is 
difficult to determine the exact number of communications that would be 
required to contain the notices anticipated under the 2022 NPRM, our 
cost estimates reflect a wide range of uncertainty in the cost. OCR 
notes that the majority of associated costs for these requirements are 
from the materials, such as paper and ink, used in the notices and 
these costs are assumed to vary with the length of notices. No changes 
were made to the estimate that administrative or clerical support 
personnel would perform these functions. The estimated personnel and 
staff time, however, increased to 1.34 hours per year to perform these 
functions. The mean hourly wage for this occupation increased to $19.02 
per hour, which we double to account for overhead and other indirect 
costs. The estimated labor cost to notify the public of their 
nondiscrimination requirements, as well as availability of language 
assistance services and auxiliary aids and services, would be $13.5 
million (($19.02 x 2) x 1.34) x 266,297 covered entities). The 
Department estimates the total associated costs for these requirements 
as an adjusted annual total of $53.2 million, with a range of costs 
between $35.5 million and $292.6 million. These costs would occur in 
each year of the time horizon of the analysis.
    OCR did not receive any comments in response to the ICRs related to 
Sec.  92.10, and received the comments discussed above in response to 
ICRs related to Sec.  92.11. Please see the prior preamble discussion 
for our responses to the general comments related to this provision. 
OCR is finalizing the ICRs for Sec. Sec.  92.10 and 92.11 as proposed.
    We have submitted a copy of this final rule to OMB for its review 
of the rule's ICRs. These requirements are not effective until they 
have been approved by OMB.
---------------------------------------------------------------------------

    \470\ The figures in this column are averages based on a range. 
Large entities with more than 15 employees may require more hours 
than those provided here due to their size and complexity, while 
small entities may require fewer hours to conduct certain compliance 
activities.
    \471\ Covered entities with 15 or more employees would be 
required to coordinate the retention of grievance complaints for no 
less than three years. We have estimated that this provision would 
apply to approximately 63,950 covered entities. All covered entities 
would be required to document employee training on section 1557. We 
estimated that this would apply to approximately 266,297 covered 
entities.
    \472\ We have estimated that covered entities with 15 or more 
employees would spend approximately 10 hours on efforts to 
coordinate their compliance efforts under section 1557 as required 
under Sec.  92.7. We estimate that all covered entities would spend 
approximately 1.25 hours documenting employee training as required 
under Sec.  92.9.
    \473\ The $38.04 wage, which includes $19.02 plus 100 percent 
for benefits, applies to the category ``Administrative or Clerical 
Support Personnel.''
    \474\ Because it is difficult to determine the exact number of 
communications which would be required to contain the notices 
anticipated under the Proposed Rule, our number of responses per 
respondent estimate reflects this uncertainty.

                                                     Table 1--Summary of Estimated Annualized Burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                            Responses                     Burden hours
                 Information collection                     Number of       frequency         Total       per response     Hourly rate     Burden cost
                                                           respondents      (average)       responses       (average)                         \470\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec.   92.7 Coordination Efforts.......................   \471\ 63,950/               1         330,247   \472\ 10/1.25    \473\ $38.04     $24,326,580/
                                                                266,297                                                                       12,662,422
Sec.  Sec.   92.10 & 92.11 Notice......................         266,297         \474\ 1         266,297            1.34           38.04       13,574,117
Total application collection...........................         330,247  ..............         596,544           12.59  ..............       50,563,119
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 37691]]

E. Assessment of Federal Regulation and Policies on Families
    Section 654 of the Treasury and General Government Appropriations 
Act of 1999 requires Federal departments and agencies to determine 
whether a proposed policy or regulation could affect family well-being. 
If the determination is affirmative, then the Department or agency must 
prepare an impact assessment to address criteria specified in the law.
    The final rule would not negatively affect family wellbeing and 
would strengthen the stability of the family by promoting the ability 
of all individuals and families to receive health care free from 
discrimination. As research demonstrates that experiencing 
discrimination can have a negative impact on health and wellbeing, this 
rule addresses the immediate and long-term effects of discriminatory 
actions and establishes a set of practices to remove barriers to 
accessing care among entities that receive Federal funds. Addressing 
and preventing discrimination in health care can also improve the 
financial stability of the family unit by increasing access to 
nondiscriminatory health insurance coverage and other health-related 
coverage, aiding parents in their ability to provide for and nurture 
their children. The rule may be carried out only by the Federal 
Government because it would implement Federal nondiscrimination law, 
ensuring that American families have access to health care information 
and services, regardless of the State where they are located.

List of Subjects

42 CFR Part 438

    Citizenship and naturalization, Civil rights, Grant programs-
health, Individuals with disabilities
    Medicaid, Reporting and recordkeeping requirements, Sex 
discrimination.

42 CFR Part 440

    Citizenship and naturalization, Civil rights, Grant programs-
health, Individuals with disabilities, Medicaid, Sex discrimination.

42 CFR Part 457

    Administrative practice and procedure, Grant programs-health, 
Health insurance, Reporting and recordkeeping requirements.

42 CFR Part 460

    Aged, Citizenship and naturalization, Civil rights, Health, Health 
care, Health records, Individuals with disabilities, Medicaid, 
Medicare, Religious discrimination, Reporting and recordkeeping 
requirements, Sex discrimination.

45 CFR Part 80

    Civil rights, Individuals with disabilities, Sex discrimination, 
Vocational education.

45 CFR Part 84

    Civil rights, Equal educational opportunity, Equal employment 
opportunity, Health care, Individuals with disabilities, Infants and 
children, Reporting and recordkeeping requirements.

45 CFR Part 92

    Administrative practice and procedure, Aged, Citizenship and 
naturalization, Civil rights, Communications equipment, Health 
facilities, Health insurance, Health programs or activities, 
Healthcare, Individuals with disabilities, Reporting and recordkeeping 
requirements, Sex discrimination.

45 CFR Part 147

    Aged, Citizenship and naturalization, Civil rights, Health care, 
Health insurance, Individuals with disabilities, Intergovernmental 
relations, Reporting and recordkeeping requirements, Sex 
discrimination.

45 CFR Part 155

    Administrative practice and procedure, Advertising, Aged, Brokers, 
Citizenship and naturalization, Civil rights, Conflict of interests, 
Consumer protection, Grant programs-health, Grants administration, 
Health care, Health insurance, Health maintenance organizations (HMO), 
Health records, Hospitals, Indians, Individuals with disabilities, 
Intergovernmental relations, Loan programs-health, Medicaid, 
Organization and functions (Government agencies), Public assistance 
programs, Reporting and recordkeeping requirements, Sex discrimination, 
State and local governments, Taxes, Technical assistance, Women, Youth.

45 CFR Part 156

    Administrative practice and procedure, Advertising, Advisory 
committees, Brokers, Conflict of interests, Consumer protection, Grant 
programs-health, Grants administration, Health care, Health insurance, 
Health maintenance organization (HMO), Health records, Hospitals, 
Indians, Individuals with disabilities, Loan programs-health, Medicaid, 
Organization and functions (Government agencies), Public assistance 
programs, Reporting and recordkeeping requirements, State and local 
governments, Sunshine Act, Technical assistance, Women, Youth.

    Dated: April 18, 2024.
Xavier Becerra,
Secretary, Department of Health and Human Services.

    For the reasons set forth in the preamble, the Department of Health 
and Human Services amends 42 CFR parts 438, 440, 457, and 460 and 45 
CFR parts 80, 84, 92, 147, 155, and 156 as follows:

Title 42--Public Health

PART 438--MANAGED CARE

0
1. The authority citation for part 438 continues to read as follows:

    Authority:  42 U.S.C. 1302.

0
2. Amend Sec.  438.3 by revising paragraph (d)(4) to read as follows:


Sec.  438.3  Standard contract requirements.

* * * * *
    (d) * * *
    (4) The MCO, PIHP, PAHP, PCCM or PCCM entity will not discriminate 
against individuals eligible to enroll on the basis of race; color; 
national origin; disability; or sex which includes sex characteristics, 
including intersex traits; pregnancy or related conditions; sexual 
orientation; gender identity; and sex stereotypes; and will not use any 
policy or practice that has the effect of discriminating on the basis 
of race; color; national origin; disability; or sex which includes 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes.
* * * * *

0
3. Amend Sec.  438.206 by revising paragraph (c)(2) to read as follows:


Sec.  438.206  Availability of services.

* * * * *
    (c) * * *
    (2) Access and cultural considerations. Each MCO, PIHP, and PAHP 
participates in the State's efforts to promote the delivery of services 
in a culturally competent manner to all enrollees, including those with 
limited English proficiency and diverse cultural and ethnic 
backgrounds, disabilities, and regardless of sex which includes sex 
characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity and sex stereotypes.
* * * * *

[[Page 37692]]

PART 440--SERVICES: GENERAL PROVISIONS

0
4. The authority citation for part 440 continues to read as follows:

    Authority: 42 U.S.C. 1302.


0
5. Revise Sec.  440.262 to read as follows:


Sec.  440.262  Access and cultural conditions.

    The State must have methods to promote access and delivery of 
services in a culturally competent manner to all beneficiaries, 
including those with limited English proficiency, diverse cultural and 
ethnic backgrounds, disabilities, and regardless of sex which includes 
sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes. 
These methods must ensure that beneficiaries have access to covered 
services that are delivered in a manner that meets their individualized 
needs.

PART 457--ALLOTMENTS AND GRANTS TO STATES

0
6. The authority citation for part 457 continues to read as follows:

    Authority: 42 U.S.C. 1302.


0
7. Amend Sec.  457.495 by adding paragraph (e) to read as follows:


Sec.  457.495  State assurance of access to care and procedures to 
assure quality and appropriateness of care.

* * * * *
    (e) Access to and delivery of services in a culturally competent 
manner to all beneficiaries, as described in 42 CFR 440.262.

PART 460--PROGRAMS OF ALL-INCLUSIVE CARE FOR THE ELDERLY (PACE)

0
8. The authority citation for part 460 continues to read as follows:

    Authority: 42 U.S.C. 1302, 1395, 1395eee(f), and 1396u-4(f).


0
9. Amend Sec.  460.98 by revising paragraph (b)(3) to read as follows:


Sec.  460.98  Service delivery.

* * * * *
    (b) * * *
    (3) The PACE organization shall not discriminate against any 
participant in the delivery of required PACE services based on race, 
ethnicity, national origin, religion, sex (including sex 
characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes), 
age, mental or physical disability, or source of payment.
* * * * *

0
10. Amend Sec.  460.112 by revising paragraph (a) introductory text to 
read as follows:


Sec.  460.112  Specific rights to which a participant is entitled.

    (a) Respect and nondiscrimination. Each participant has the right 
to considerate, respectful care from all PACE employees and contractors 
at all times and under all circumstances. Each participant has the 
right not to be discriminated against in the delivery of required PACE 
services based on race, ethnicity, national origin, religion, sex 
(including sex characteristics, including intersex traits; pregnancy or 
related conditions; sexual orientation; gender identity; and sex 
stereotypes), age, mental or physical disability, or source of payment. 
Specifically, each participant has the right to the following:
* * * * *

Title 45--Public Welfare

PART 80--NONDISCRIMINATION UNDER PROGRAMS RECEIVING FEDERAL 
ASSISTANCE THROUGH THE DEPARTMENT OF HEALTH AND HUMAN SERVICES 
EFFECTUATION OF TITLE VI OF THE CIVIL RIGHTS ACT OF 1964

0
11. The authority citation for part 80 continues to read as follows:

    Authority: Sec. 602, 78 Stat. 252; 42 U.S.C. 2000d-1.


0
12. Amend appendix A to part 80 under part 1 by adding entry 155 in 
numerical order to read as follows:

Appendix A to Part 80--Federal Financial Assistance To Which These 
Regulations Apply Part 1. Assistance Other Than Continuing Assistance 
to States

* * * * *
    155. Supplementary medical insurance benefits for the aged 
(Title XVIII, Part B, Social Security Act, 42 U.S.C. 1395j-1395w-6).
* * * * *

PART 84--NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR 
ACTIVITIES RECEIVING FEDERAL FINANCIAL ASSISTANCE

0
13. The authority citation for part 84 continues to read as follows:

    Authority:  20 U.S.C. 1405; 29 U.S.C. 794; 42 U.S.C. 290dd-2; 21 
U.S.C. 1174.


0
14. Amend appendix A to part 84 in subpart a, under Definitions, by 
revising section 2 to read as follows:

Appendix A to Part 84--Analysis of Final Regulation

Subpart A--General Provisions

Definitions * * *

    2. ``Federal financial assistance''. In Sec.  84.3(h), defining 
Federal financial assistance, a clarifying change has been made: 
procurement contracts are specifically excluded. They are covered, 
however, by the Department of Labor's regulation under section 503. 
The Department has never considered such contracts to be contracts 
of assistance; the explicit exemption has been added only to avoid 
possible confusion.
    The proposed regulation's exemption of contracts of insurance or 
guaranty has been retained. A number of comments argued for its 
deletion on the ground that section 504, unlike title VI and title 
IX, contains no statutory exemption for such contracts. There is no 
indication, however, in the legislative history of the 
Rehabilitation Act of 1973 or of the amendments to that Act in 1974, 
that Congress intended section 504 to have a broader application, in 
terms of Federal financial assistance, than other civil rights 
statutes. Indeed, Congress directed that section 504 be implemented 
in the same manner as titles VI and IX. In view of the long 
established exemption of contracts of insurance or guaranty under 
title VI, we think it unlikely that Congress intended section 504 to 
apply to such contracts.
* * * * *


0
15. Revise part 92 to read as follows:

PART 92--NONDISCRIMINATION IN HEALTH PROGRAMS OR ACTIVITIES

Subpart A--General Provisions
Sec.
92.1 Purpose and effective date.
92.2 Application.
92.3 Relationship to other laws.
92.4 Definitions.
92.5 Assurances required.
92.6 Remedial action and voluntary action.
92.7 Designation and responsibilities of a Section 1557 Coordinator.
92.8 Policies and procedures.
92.9 Training.
92.10 Notice of nondiscrimination.
92.11 Notice of availability of language assistance services and 
auxiliary aids and services.
Subpart B--Nondiscrimination Provisions
92.101 Discrimination prohibited.
Subpart C--Specific Applications to Health Programs and Activities
92.201 Meaningful access for individuals with limited English 
proficiency.
92.202 Effective communication for individuals with disabilities.
92.203 Accessibility for buildings and facilities.
92.204 Accessibility of information and communication technology for 
individuals with disabilities.
92.205 Requirement to make reasonable modifications.

[[Page 37693]]

92.206 Equal program access on the basis of sex.
92.207 Nondiscrimination in health insurance coverage and other 
health-related coverage.
92.208 Prohibition on sex discrimination related to marital, 
parental, or family status.
92.209 Nondiscrimination on the basis of association.
92.210 Nondiscrimination in the use of patient care decision support 
tools.
92.211 Nondiscrimination in the delivery of health programs and 
activities through telehealth services.
Subpart D--Procedures
92.301 Enforcement mechanisms.
92.302 Notification of views regarding application of Federal 
religious freedom and conscience laws.
92.303 Procedures for health programs and activities conducted by 
recipients and State Exchanges.
92.304 Procedures for health programs and activities administered by 
the Department.

    Authority:  42 U.S.C. 18116.

PART 92--NONDISCRIMINATION IN HEALTH PROGRAMS OR ACTIVITIES

Subpart A--General Provisions


Sec.  92.1  Purpose and effective date.

    (a) Purpose. The purpose of this part is to implement section 1557 
of the Patient Protection and Affordable Care Act (ACA) (42 U.S.C. 
18116), which prohibits discrimination on the basis of race, color, 
national origin, sex, age, and disability in certain health programs 
and activities. Section 1557 provides that, except as otherwise 
provided in title I of the ACA, an individual shall not, on the grounds 
prohibited under title VI of the Civil Rights Act of 1964, title IX of 
the Education Amendments of 1972, the Age Discrimination Act of 1975, 
or section 504 of the Rehabilitation Act of 1973, be excluded from 
participation in, be denied the benefits of, or be subjected to 
discrimination under, any health program or activity, any part of which 
is receiving Federal financial assistance, including credits, 
subsidies, or contracts of insurance, or under any program or activity 
that is administered by an executive agency or any entity established 
under title I of the ACA. This part applies to health programs or 
activities administered by recipients of Federal financial assistance 
from the Department, Department-administered health programs or 
activities, and title I entities that administer health programs or 
activities.
    (b) Effective date. The regulations in this part are effective 
beginning July 5, 2024, unless otherwise provided in the following 
schedule:

                        Table 1 to Paragraph (b)
------------------------------------------------------------------------
   Section 1557 requirement and     Date by which covered entities must
            provision                              comply
------------------------------------------------------------------------
Sec.   92.7......................  Within 120 days of July 5, 2024.
Sec.   92.8......................  Within one year of July 5, 2024.
Sec.   92.9......................  Following a covered entity's
                                    implementation of the policies and
                                    procedures required by Sec.   92.8,
                                    and no later than one year of July
                                    5, 2024.
Sec.   92.10.....................  Within 120 days of July 5, 2024.
Sec.   92.11.....................  Within one year of July 5, 2024.
Sec.   92.207(b)(1) through (5)..  For health insurance coverage or
                                    other health-related coverage that
                                    was not subject to this part as of
                                    July 5, 2024, by the first day of
                                    the first plan year (in the
                                    individual market, policy year)
                                    beginning on or after January 1,
                                    2025.
Sec.   92.207(b)(6)..............  By the first day of the first plan
                                    year (in the individual market,
                                    policy year) beginning on or after
                                    January 1, 2025.
Sec.   92.210(b) and (c).........  Within 300 days of July 5, 2024.
------------------------------------------------------------------------

Sec.  92.2  Application.

    (a) Except as otherwise provided in this part, this part shall 
apply to:
    (1) Every health program or activity, any part of which receives 
Federal financial assistance, directly or indirectly, from the 
Department;
    (2) Every health program or activity administered by the 
Department; and
    (3) Every health program or activity administered by a title I 
entity.
    (b) The provisions of this part shall not apply to any employer or 
other plan sponsor of a group health plan, including but not limited 
to, a board of trustees (or similar body), association or other group, 
with regard to its employment practices, including the provision of 
employee health benefits.
    (c) Any provision of this part held to be invalid or unenforceable 
by its terms, or as applied to any person or circumstance, shall be 
severable from this part and shall not affect the remainder thereof or 
the application of the provision to other persons not similarly 
situated or to other, dissimilar circumstances.


Sec.  92.3  Relationship to other laws.

    (a) Neither section 1557 nor this part shall be construed to apply 
a lesser standard for the protection of individuals from discrimination 
than the standards applied under title VI of the Civil Rights Act of 
1964, title IX of the Education Amendments of 1972, section 504 of the 
Rehabilitation Act of 1973, the Age Discrimination Act of 1975, or the 
regulations issued pursuant to those laws.
    (b) Nothing in this part shall be construed to invalidate or limit 
the rights, remedies, procedures, or legal standards available under 
title VI of the Civil Rights Act of 1964, title VII of the Civil Rights 
Act of 1964, title IX of the Education Amendments of 1972, section 504 
of the Rehabilitation Act of 1973, or the Age Discrimination Act of 
1975.
    (c) Insofar as the application of any requirement under this part 
would violate applicable Federal protections for religious freedom and 
conscience, such application shall not be required. For example, 42 
U.S.C. 18023 provides (among other things) that nothing in section 1557 
shall be construed to have any effect on Federal laws regarding 
conscience protection; willingness or refusal to provide abortion; and 
discrimination on the basis of the willingness or refusal to provide, 
pay for, cover, or refer for abortion or to provide or participate in 
training to provide abortion.
    (d) Nothing in this part shall be construed to supersede State or 
local laws that provide additional protections against discrimination 
on any basis described in Sec.  92.1.


Sec.  92.4  Definitions.

    As used in this part, the term--
    1991 Standards means the 1991 ADA Standards for Accessible Design, 
published at appendix A to 28 CFR part 36 on July 26, 1991, and 
republished as appendix D to 28 CFR part 36 on September 15, 2010.

[[Page 37694]]

    2010 Standards means 36 CFR part 1191, appendices B and D (2009), 
in conjunction with 28 CFR 35.151.
    ACA means the Patient Protection and Affordable Care Act (Pub. L. 
111-148, 124 Stat. 119 (2010) as amended by the Health Care and 
Education Reconciliation Act of 2010 (Pub. L. 111-152, 124 Stat. 1029) 
(codified in scattered sections of U.S.C.)).
    ADA means the Americans with Disabilities Act of 1990 (42 U.S.C. 
12101 et seq.), as amended.
    Age means how old a person is, or the number of elapsed years from 
the date of a person's birth.
    Age Act means the Age Discrimination Act of 1975 (42 U.S.C. 6101 et 
seq.), as amended.
    Applicant means a person who applies to participate in a health 
program or activity.
    Auxiliary aids and services include, for example:
    (1) Qualified interpreters on-site or through video remote 
interpreting (VRI) services, as defined in 28 CFR 35.104 and 36.104; 
note takers; real-time computer-aided transcription services; written 
materials; exchange of written notes; telephone handset amplifiers; 
assistive listening devices; assistive listening systems; telephones 
compatible with hearing aids; closed caption decoders; open and closed 
captioning, including real-time captioning; voice, text, and video-
based telecommunications products and systems, including text 
telephones (TTYs), videophones, and captioned telephones, or equally 
effective telecommunications devices; videotext displays; accessible 
information and communication technology (ICT); or other effective 
methods of making aurally delivered information available to persons 
who are deaf or hard of hearing;
    (2) Qualified readers; taped texts; audio recordings; Braille 
materials and displays; screen reader software; magnification software; 
optical readers; secondary auditory programs (SAP); large print 
materials; accessible information and communication technology; or 
other effective methods of making visually delivered materials 
available to persons who are blind or have low vision;
    (3) Acquisition or modification of equipment and devices; and
    (4) Other similar services and actions.
    Companion means a family member, friend, or associate of an 
individual seeking access to a service, program, or activity of a 
covered entity, who along with such individual, is an appropriate 
person with whom a covered entity should communicate.
    Covered entity means:
    (1) A recipient of Federal financial assistance;
    (2) The Department; and
    (3) An entity established under title I of the ACA.
    Department means the U.S. Department of Health and Human Services.
    Director means the Director of the Office for Civil Rights (OCR) of 
the Department, or their designee(s).
    Disability means, with respect to an individual, a physical or 
mental impairment that substantially limits one or more major life 
activities of such individual; a record of such an impairment; or being 
regarded as having such an impairment, as defined and construed in the 
Rehabilitation Act, 29 U.S.C. 705(9)(B), which incorporates the 
definition of ``disability'' in the ADA, 42 U.S.C. 12102, as amended 
and adopted at 28 CFR 35.108.
    Exchange means the same as ``Exchange'' defined in 45 CFR 155.20.
    Federal financial assistance, as used in this part:
    (1) Federal financial assistance means any grant, loan, credit, 
subsidy, contract (other than a procurement contract but including a 
contract of insurance), or any other arrangement by which the Federal 
Government, directly or indirectly, provides assistance or otherwise 
makes assistance available in the form of:
    (i) Funds;
    (ii) Services of Federal personnel; or
    (iii) Real or personal property or any interest in or use of such 
property, including:
    (A) Transfers or leases of such property for less than fair market 
value or for reduced consideration; and
    (B) Proceeds from a subsequent transfer or lease of such property 
if the Federal share of its fair market value is not returned to the 
Federal Government.
    (2) Federal financial assistance the Department provides or 
otherwise makes available includes Federal financial assistance that 
the Department plays a role in providing or administering, including 
advance payments of the premium tax credit and cost-sharing reduction 
payments under title I of the ACA, as well as payments, subsidies, or 
other funds extended by the Department to any entity providing health 
insurance coverage for payment to or on behalf of a person obtaining 
health insurance coverage from that entity or extended by the 
Department directly to such person for payment to any entity providing 
health insurance coverage.
    Federally-facilitated Exchange means the same as ``Federally-
facilitated Exchange'' defined in 45 CFR 155.20.
    Health program or activity means:
    (1) Any project, enterprise, venture, or undertaking to:
    (i) Provide or administer health-related services, health insurance 
coverage, or other health-related coverage;
    (ii) Provide assistance to persons in obtaining health-related 
services, health insurance coverage, or other health-related coverage;
    (iii) Provide clinical, pharmaceutical, or medical care;
    (iv) Engage in health or clinical research; or
    (v) Provide health education for health care professionals or 
others.
    (2) All of the operations of any entity principally engaged in the 
provision or administration of any health projects, enterprises, 
ventures, or undertakings described in paragraph (1) of this 
definition, including, but not limited to, a State or local health 
agency, hospital, health clinic, health insurance issuer, physician's 
practice, pharmacy, community-based health care provider, nursing 
facility, residential or community-based treatment facility, or other 
similar entity or combination thereof. A health program or activity 
also includes all of the operations of a State Medicaid program, 
Children's Health Insurance Program, and Basic Health Program.
    Individual with limited English proficiency means an individual 
whose primary language for communication is not English and who has a 
limited ability to read, write, speak, or understand English. An 
individual with limited English proficiency may be competent in English 
for certain types of communication (e.g., speaking or understanding), 
but still be limited English proficient for other purposes (e.g., 
reading or writing).
    Information and communication technology (ICT) means information 
technology and other equipment, systems, technologies, or processes, 
for which the principal function is the creation, manipulation, 
storage, display, receipt, or transmission of electronic data and 
information, as well as any associated content. Examples of ICT 
include, but are not limited to: computers and peripheral equipment; 
information kiosks and transaction machines; telecommunications 
equipment; telehealth interfaces or applications; customer premises 
equipment; multifunction office machines; software; mobile 
applications; websites; videos; and electronic documents.
    Language assistance services may include, but are not limited to:

[[Page 37695]]

    (1) Oral language assistance, including interpretation in non-
English languages provided in-person or remotely by a qualified 
interpreter for an individual with limited English proficiency, and the 
use of qualified bilingual or multilingual staff to communicate 
directly with individuals with limited English proficiency;
    (2) Written translation, performed by a qualified translator, of 
written content in paper or electronic form into or from languages 
other than English; and
    (3) Written notice of availability of language assistance services.
    Machine translation means automated translation, without the 
assistance of or review by a qualified human translator, that is text-
based and provides instant translations between various languages, 
sometimes with an option for audio input or output.
    National origin includes, but is not limited to, a person's, or 
their ancestors', place of origin (such as country or world region) or 
a person's manifestation of the physical, cultural, or linguistic 
characteristics of a national origin group.
    OCR means the Office for Civil Rights of the Department.
    Patient care decision support tool means any automated or non-
automated tool, mechanism, method, technology, or combination thereof 
used by a covered entity to support clinical decision-making in its 
health programs or activities.
    Qualified bilingual/multilingual staff means a member of a covered 
entity's workforce who is designated by the covered entity to provide 
in-language oral language assistance as part of the person's current, 
assigned job responsibilities and who has demonstrated to the covered 
entity that they are:
    (1) Proficient in speaking and understanding both spoken English 
and at least one other spoken language, including any necessary 
specialized vocabulary, terminology and phraseology; and
    (2) Able to effectively, accurately, and impartially communicate 
directly with individuals with limited English proficiency in their 
primary languages.
    Qualified individual with a disability means an individual with a 
disability who, with or without reasonable modifications to rules, 
policies, or practices, the removal of architectural, communication, or 
transportation barriers, or the provision of auxiliary aids and 
services, meets the essential eligibility requirements for the receipt 
of services or the participation in programs or activities provided by 
the covered entity.
    Qualified interpreter for an individual with a disability means an 
interpreter who, via a video remote interpreting service (VRI) or an 
on-site appearance:
    (1) Has demonstrated proficiency in communicating in, and 
understanding:
    (i) Both English and a non-English language (including American 
Sign Language, other sign languages); or
    (ii) Another communication modality (such as cued-language 
transliterators or oral transliteration);
    (2) Is able to interpret effectively, accurately, and impartially, 
both receptively and expressively, using any necessary specialized 
vocabulary or terms without changes, omissions, or additions and while 
preserving the tone, sentiment, and emotional level of the original 
statement; and
    (3) Adheres to generally accepted interpreter ethics principles 
including client confidentiality.
    (4) Qualified interpreters include, for example, sign language 
interpreters, oral transliterators, and cued-language transliterators.
    Qualified interpreter for an individual with limited English 
proficiency means an interpreter who via a remote interpreting service 
or an on-site appearance:
    (1) Has demonstrated proficiency in speaking and understanding both 
spoken English and at least one other spoken language (qualified 
interpreters for relay interpretation must demonstrate proficiency in 
two non-English spoken languages);
    (2) Is able to interpret effectively, accurately, and impartially 
to and from such language(s) and English (or between two non-English 
languages for relay interpretation), using any necessary specialized 
vocabulary or terms without changes, omissions, or additions and while 
preserving the tone, sentiment, and emotional level of the original 
oral statement; and
    (3) Adheres to generally accepted interpreter ethics principles, 
including client confidentiality.
    Qualified reader means a person who is able to read effectively, 
accurately, and impartially using any necessary specialized vocabulary.
    Qualified translator means a translator who:
    (1) Has demonstrated proficiency in writing and understanding both 
written English and at least one other written non-English language;
    (2) Is able to translate effectively, accurately, and impartially 
to and from such language(s) and English, using any necessary 
specialized vocabulary or terms without changes, omissions, or 
additions and while preserving the tone, sentiment, and emotional level 
of the original written statement; and
    (3) Adheres to generally accepted translator ethics principles, 
including client confidentiality.
    Recipient means any State or its political subdivision thereof; or 
any instrumentality of a State or political subdivision thereof; any 
public or private agency, institution, or organization; other entity; 
or any person, to whom Federal financial assistance is extended 
directly or indirectly, including any subunit, successor, assignee, or 
transferee of a recipient. Such term does not include any ultimate 
beneficiary.
    Relay interpretation means interpreting from one language to 
another through an intermediate language. This mode of interpretation 
is often used for monolingual speakers of languages of limited 
diffusion, including select indigenous languages. In relay 
interpreting, the first interpreter listens to the speaker and renders 
the message into the intermediate language. The second interpreter 
receives the message in the intermediate language and interprets it 
into a third language for the speaker who speaks neither the first nor 
the second language.
    Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112; 29 U.S.C. 794), as amended.
    Section 1557 means section 1557 of the ACA (42 U.S.C. 18116).
    State includes each of the several States, the District of 
Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the 
United States Virgin Islands, and the Commonwealth of the Northern 
Mariana Islands.
    State Exchange means an Exchange established by a State and 
approved by the Department pursuant to 45 CFR part 155, subpart B.
    Telehealth means the use of electronic information and 
telecommunications technologies to support long-distance clinical 
health care, patient and professional health-related education, public 
health, and health administration. Technologies include 
videoconferencing, the internet, store-and-forward imaging, streaming 
media, and terrestrial and wireless communications.
    Title I entity means any entity established under title I of the 
ACA, as amended, including State Exchanges and Federally-facilitated 
Exchanges.
    Title VI means title VI of the Civil Rights Act of 1964 (Pub. L. 
88-352; 42 U.S.C. 2000d et seq.), as amended.
    Title VII means title VII of the Civil Rights Act of 1964 (Pub. L. 
88-352; 42 U.S.C. 2000e et seq.), as amended.

[[Page 37696]]

    Title IX means title IX of the Education Amendments of 1972 (Pub. 
L. 92-318; 20 U.S.C. 1681 et seq.), as amended.
    UFAS means the Uniform Federal Accessibility Standards (Pub. L. 90-
480; 42 U.S.C. 4151 et seq.), as amended.


Sec.  92.5  Assurances required.

    (a) Assurances. An entity applying for Federal financial assistance 
to which this part applies must, as a condition of any application for 
Federal financial assistance, submit an assurance, on a form specified 
by the Director, that the entity's health programs and activities will 
be operated in compliance with section 1557 and this part. A health 
insurance issuer seeking certification to participate in an Exchange or 
a State seeking approval to operate a State Exchange to which section 
1557 or this part applies must, as a condition of certification or 
approval, submit an assurance, on a form specified by the Director, 
that the health insurance issuer's or State's health program or 
activity will be operated in compliance with section 1557 and this 
part. An applicant or entity may incorporate this assurance by 
reference in subsequent applications to the Department for Federal 
financial assistance or requests for certification to participate in an 
Exchange or approval to operate a State Exchange.
    (b) Duration of obligation. The duration of the assurances required 
by this section is the same as the duration of the assurances required 
in the Department's regulations implementing section 504, 45 CFR 
84.5(b).
    (c) Covenants. When Federal financial assistance is provided in the 
form of real property or interest, the same conditions apply as those 
contained in the Department's regulations implementing section 504, at 
45 CFR 84.5(c), except that the nondiscrimination obligation applies to 
discrimination on all bases covered under section 1557 and this part.


Sec.  92.6  Remedial action and voluntary action.

    (a) Remedial action. (1) If the Director finds that a recipient or 
State Exchange has discriminated against an individual on the basis of 
race, color, national origin, sex, age, or disability, in violation of 
section 1557 or this part, such recipient or State Exchange must take 
such remedial action as the Director may require to overcome the 
effects of the discrimination.
    (2) Where a recipient is found to have discriminated against an 
individual on the basis of race, color, national origin, sex, age, or 
disability, in violation of section 1557 or this part, and where 
another recipient exercises control over the recipient that has 
discriminated, the Director, where appropriate, may require either or 
both entities to take remedial action.
    (3) The Director may, where necessary to overcome the effects of 
discrimination in violation of section 1557 or this part, require a 
recipient, in its health programs and activities, or State Exchange to 
take remedial action with respect to:
    (i) Persons who are no longer participants in the recipient's or 
State Exchange's health program or activity but who were participants 
in the health program or activity when such discrimination occurred; or
    (ii) Persons who would have been participants in the health program 
or activity had the discrimination not occurred.
    (b) Voluntary action. A covered entity may take nondiscriminatory 
steps, in addition to any action that is required by section 1557 or 
this part, to overcome the effects of conditions that result or 
resulted in limited participation in the covered entity's health 
programs or activities by persons on the basis of race, color, national 
origin, sex, age, or disability.


Sec.  92.7  Designation and responsibilities of a Section 1557 
Coordinator.

    (a) Section 1557 Coordinator and designees. A covered entity that 
employs fifteen or more persons must designate and authorize at least 
one employee, a ``Section 1557 Coordinator,'' to coordinate the covered 
entity's compliance with its responsibilities under section 1557 and 
this part in its health programs and activities, including the 
investigation of any grievance communicated to it alleging 
noncompliance with section 1557 or this part or alleging any action 
that would be prohibited by section 1557 or this part. As appropriate, 
a covered entity may assign one or more designees to carry out some of 
these responsibilities, but the Section 1557 Coordinator must retain 
ultimate oversight for ensuring coordination with the covered entity's 
compliance with this part.
    (b) Responsibilities of a Section 1557 Coordinator. A covered 
entity must ensure that, at minimum, the Section 1557 Coordinator:
    (1) Receives, reviews, and processes grievances, filed under the 
grievance procedure as set forth in Sec.  92.8(c);
    (2) Coordinates the covered entity's recordkeeping requirements as 
set forth in Sec.  92.8(c);
    (3) Coordinates effective implementation of the covered entity's 
language access procedures as set forth in Sec.  92.8(d);
    (4) Coordinates effective implementation of the covered entity's 
effective communication procedures as set forth in Sec.  92.8(e);
    (5) Coordinates effective implementation of the covered entity's 
reasonable modification procedures as set forth in Sec.  92.8(f); and
    (6) Coordinates training of relevant employees as set forth in 
Sec.  92.9, including maintaining documentation required by such 
section.


Sec.  92.8  Policies and procedures.

    (a) General requirement. A covered entity must implement written 
policies and procedures in its health programs and activities that are 
designed to comply with the requirements of this part. The policies and 
procedures must include an effective date and be reasonably designed, 
taking into account the size, complexity, and the type of health 
programs or activities undertaken by a covered entity, to ensure 
compliance with this part.
    (b) Nondiscrimination policy. (1) A covered entity must implement a 
written policy in its health programs and activities that, at minimum, 
states the covered entity does not discriminate on the basis of race, 
color, national origin (including limited English proficiency and 
primary language), sex (consistent with the scope of sex discrimination 
described at Sec.  92.101(a)(2)), age, or disability; that the covered 
entity provides language assistance services and appropriate auxiliary 
aids and services free of charge, when necessary for compliance with 
section 1557 or this part; that the covered entity will provide 
reasonable modifications for individuals with disabilities; and that 
provides the current contact information for the Section 1557 
Coordinator required by Sec.  92.7 (if applicable).
    (2) OCR considers it a best practice toward achieving compliance 
for a covered entity to provide information that it has been granted a 
temporary exemption or granted an assurance of exemption under Sec.  
92.302(b) in the nondiscrimination policy required by paragraph (b)(1) 
of this section.
    (c) Grievance procedures. (1) A covered entity that employs fifteen 
or more persons must implement written grievance procedures in its 
health programs and activities that provide for the prompt and 
equitable resolution of grievances alleging any action that would be 
prohibited by section 1557 or this part.

[[Page 37697]]

    (2) A covered entity to which this paragraph applies must retain 
records related to grievances filed pursuant to the covered entity's 
grievance procedures required under paragraph (c)(1) of this section 
that allege discrimination on the basis of race, color, national 
origin, sex, age, or disability for no less than three (3) calendar 
years from the date the covered entity resolves the grievance. The 
records must include the grievance; the name and contact information of 
the complainant (if provided by complainant); the alleged 
discriminatory action and alleged basis (or bases) of discrimination; 
the date the grievance was filed; the date the grievance was resolved; 
grievance resolution; and any other pertinent information.
    (3) A covered entity to which this paragraph (c) applies must keep 
confidential the identity of an individual who has filed a grievance 
under this part except as required by law or to the extent necessary to 
carry out the purposes of this part, including the conduct of any 
investigation.
    (d) Language access procedures. A covered entity must implement 
written language access procedures in its health programs and 
activities describing the covered entity's process for providing 
language assistance services to individuals with limited English 
proficiency when required under Sec.  92.201. At a minimum, the 
language access procedures must include current contact information for 
the section 1557 Coordinator (if applicable); how an employee 
identifies whether an individual has limited English proficiency; how 
an employee obtains the services of qualified interpreters and 
translators the covered entity uses to communicate with an individual 
with limited English proficiency; the names of any qualified bilingual 
staff members; and a list of any electronic and written translated 
materials the covered entity has, the languages they are translated 
into, date of issuance, and how to access electronic translations.
    (e) Effective communication procedures. A covered entity must 
implement written effective communication procedures in its health 
programs and activities describing the covered entity's process for 
ensuring effective communication for individuals with disabilities when 
required under Sec.  92.202. At a minimum, a covered entity's effective 
communication procedures must include current contact information for 
the Section 1557 Coordinator (if applicable); how an employee obtains 
the services of qualified interpreters the covered entity uses to 
communicate with individuals with disabilities, including the names of 
any qualified interpreter staff members; and how to access appropriate 
auxiliary aids and services.
    (f) Reasonable modification procedures. A covered entity must 
implement written procedures in its health programs and activities 
describing the covered entity's process for making reasonable 
modifications to its policies, practices, or procedures when necessary 
to avoid discrimination on the basis of disability as required under 
Sec.  92.205. At a minimum, the reasonable modification procedures must 
include current contact information for the covered entity's Section 
1557 Coordinator (if applicable); a description of the covered entity's 
process for responding to requests from individuals with disabilities 
for changes, exceptions, or adjustments to a rule, policy, practice, or 
service of the covered entity; and a process for determining whether 
making the modification would fundamentally alter the nature of the 
health program or activity, including identifying an alternative 
modification that does not result in a fundamental alteration to ensure 
the individual with a disability receives the benefits or services in 
question.
    (g) Combined policies and procedures. A covered entity may combine 
the content of the policies and procedures required by paragraphs (b) 
through (f) of this section with any policies and procedures pursuant 
to title VI, section 504, title IX, and the Age Act if section 1557 and 
the provisions in this part are clearly addressed therein.
    (h) Changes to policies and procedures. (1) Covered entities must 
review and revise the policies and procedures required by paragraphs 
(b) through (g) of this section, as necessary, to ensure they are 
current and in compliance with section 1557 and this part; and
    (2) A covered entity may change a policy or procedure required by 
paragraphs (b) through (g) of this section at any time, provided that 
such changes comply with section 1557 and this part.


Sec.  92.9  Training.

    (a) A covered entity must train relevant employees of its health 
programs and activities on the civil rights policies and procedures 
required by Sec.  92.8, as necessary and appropriate for the employees 
to carry out their functions within the covered entity consistent with 
the requirements of this part.
    (b) A covered entity must provide training that meets the 
requirements of paragraph (a) of this section, as follows:
    (1) To each relevant employee of the health program or activity as 
soon as possible, but no later than 30 days following a covered 
entity's implementation of the policies and procedures required by 
Sec.  92.8, and no later than 300 days following July 5, 2024;
    (2) Thereafter, to each new relevant employee of the health program 
or activity within a reasonable period of time after the employee joins 
the covered entity's workforce; and
    (3) To each relevant employee of the health program or activity 
whose functions are affected by a material change in the policies or 
procedures required by Sec.  92.8 and any other civil rights policies 
or procedures the covered entity has implemented within a reasonable 
period of time after the material change has been made.
    (4) For purposes of this section, ``relevant employees'' includes 
permanent and temporary employees whose roles and responsibilities 
entail interacting with patients and members of the public; making 
decisions that directly or indirectly affect patients' health care, 
including the covered entity's executive leadership team and legal 
counsel; and performing tasks and making decisions that directly or 
indirectly affect patients' financial obligations, including billing 
and collections.
    (c) A covered entity must contemporaneously document its employees' 
completion of the training required by paragraphs (a) and (b) of this 
section in written or electronic form and retain said documentation for 
no less than three (3) calendar years.


Sec.  92.10  Notice of nondiscrimination.

    (a) A covered entity must provide a notice of nondiscrimination to 
participants, beneficiaries, enrollees, and applicants of its health 
programs and activities, and members of the public.
    (1) The notice required under this paragraph (a) must include the 
following information relating to the covered entity's health programs 
and activities:
    (i) The covered entity does not discriminate on the basis of race, 
color, national origin (including limited English proficiency and 
primary language), sex (consistent with the scope of sex discrimination 
described at Sec.  92.101(a)(2)), age, or disability;
    (ii) The covered entity provides reasonable modifications for 
individuals with disabilities, and appropriate

[[Page 37698]]

auxiliary aids and services, including qualified interpreters for 
individuals with disabilities and information in alternate formats, 
such as braille or large print, free of charge and in a timely manner, 
when such modifications, aids, and services are necessary to ensure 
accessibility and an equal opportunity to participate to individuals 
with disabilities;
    (iii) The covered entity provides language assistance services, 
including electronic and written translated documents and oral 
interpretation, free of charge and in a timely manner, when such 
services are a reasonable step to provide meaningful access to an 
individual with limited English proficiency;
    (iv) How to obtain from the covered entity the reasonable 
modifications, appropriate auxiliary aids and services, and language 
assistance services in paragraphs (a)(1)(ii) and (iii) of this section;
    (v) The contact information for the covered entity's Section 1557 
Coordinator designated pursuant to Sec.  92.7 (if applicable);
    (vi) The availability of the covered entity's grievance procedure 
pursuant to Sec.  92.8(c) and how to file a grievance (if applicable);
    (vii) Details on how to file a discrimination complaint with OCR in 
the Department; and
    (viii) How to access the covered entity's website, if it has one, 
that provides the information required under this paragraph (a)(1).
    (2) The notice required under this paragraph (a) must be provided 
in a covered entity's health program or activity, as follows:
    (i) On an annual basis to participants, beneficiaries, enrollees 
(including late and special enrollees), and applicants of its health 
program or activity;
    (ii) Upon request;
    (iii) At a conspicuous location on the covered entity's health 
program or activity website, if it has one; and
    (iv) In clear and prominent physical locations, in no smaller than 
20-point sans serif font, where it is reasonable to expect individuals 
seeking service from the health program or activity to be able to read 
or hear the notice.
    (b) A covered entity may combine the content of the notice required 
by paragraph (a) of this section with the notices required by 45 CFR 
80.6(d), 84.8, 86.9, and 91.32 if the combined notice clearly informs 
individuals of their civil rights under section 1557 and this part, so 
long as it includes each of the elements required by paragraph (a)(1) 
of this section.


Sec.  92.11  Notice of availability of language assistance services and 
auxiliary aids and services.

    (a) A covered entity must provide a notice of availability of 
language assistance services and auxiliary aids and services that, at 
minimum, states that the covered entity, in its health programs or 
activities, provides language assistance services and appropriate 
auxiliary aids and services free of charge, when necessary for 
compliance with section 1557 or this part, to participants, 
beneficiaries, enrollees, and applicants of its health program or 
activities, and members of the public.
    (b) The notice required under paragraph (a) of this section must be 
provided in English and at least the 15 languages most commonly spoken 
by individuals with limited English proficiency of the relevant State 
or States in which a covered entity operates and must be provided in 
alternate formats for individuals with disabilities who require 
auxiliary aids and services to ensure effective communication.
    (c) The notice required under paragraph (a) of this section must be 
provided in a covered entity's health program or activity, as follows:
    (1) On an annual basis to participants, beneficiaries, enrollees 
(including late and special enrollees), and applicants of its health 
program or activity;
    (2) Upon request;
    (3) At a conspicuous location on the covered entity's health 
program or activity website, if it has one;
    (4) In clear and prominent physical locations, in no smaller than 
20-point sans serif font, where it is reasonable to expect individuals 
seeking service from the health program or activity to be able to read 
or hear the notice; and
    (5) In the following electronic and written communications when 
these forms are provided by a covered entity:
    (i) Notice of nondiscrimination required by Sec.  92.10;
    (ii) Notice of privacy practices required by 45 CFR 164.520;
    (iii) Application and intake forms;
    (iv) Notices of denial or termination of eligibility, benefits or 
services, including Explanations of Benefits, and notices of appeal and 
grievance rights;
    (v) Communications related to an individual's rights, eligibility, 
benefits, or services that require or request a response from a 
participant, beneficiary, enrollee, or applicant;
    (vi) Communications related to a public health emergency;
    (vii) Consent forms and instructions related to medical procedures 
or operations, medical power of attorney, or living will (with an 
option of providing only one notice for all documents bundled 
together);
    (viii) Discharge papers;
    (ix) Communications related to the cost and payment of care with 
respect to an individual, including medical billing and collections 
materials, and good faith estimates required by section 2799B-6 of the 
Public Health Service Act;
    (x) Complaint forms; and
    (xi) Patient and member handbooks.
    (d) A covered entity shall be deemed in compliance with this 
section with respect to an individual if it exercises the option to:
    (1) On an annual basis, provide the individual with the option to 
opt out of receipt of the notice required by this section in their 
primary language and through any appropriate auxiliary aids and 
services, and:
    (i) Does not condition the receipt of any aid or benefit on the 
individual's decision to opt out;
    (ii) Informs the individual that they have a right to receive the 
notice upon request in their primary language and through the 
appropriate auxiliary aids and services;
    (iii) Informs the individual that opting out of receiving the 
notice is not a waiver of their right to receive language assistance 
services and any appropriate auxiliary aids and services as required by 
this part;
    (iv) Documents, on an annual basis, that the individual has opted 
out of receiving the notice required by this section for that year; and
    (v) Does not treat a non-response from an individual as a decision 
to opt out; or
    (2) Document the individual's primary language and any appropriate 
auxiliary aids and services and:
    (i) Provides all materials and communications in that individual's 
primary language and through any appropriate auxiliary aids and 
services; or
    (ii) Provides the notice required by paragraph (a) of this section 
in that individual's primary language and through any appropriate 
auxiliary aids and services in all communications that are identified 
in paragraph (c)(5) of this section.

Subpart B--Nondiscrimination Provisions


Sec.  92.101  Discrimination prohibited.

    (a) General. (1) Except as provided in title I of the ACA, an 
individual must not, on the basis of race, color, national origin, sex, 
age, disability, or any combination thereof, be excluded from

[[Page 37699]]

participation in, be denied the benefits of, or otherwise be subjected 
to discrimination under any health program or activity operated by a 
covered entity.
    (2) Discrimination on the basis of sex includes, but is not limited 
to, discrimination on the basis of:
    (i) Sex characteristics, including intersex traits;
    (ii) Pregnancy or related conditions;
    (iii) Sexual orientation;
    (iv) Gender identity; and
    (v) Sex stereotypes.
    (b) Specific prohibitions on discrimination. (1) In any health 
program or activity to which this part applies:
    (i) A recipient and State Exchange must comply with the specific 
prohibitions on discrimination in the Department's implementing 
regulations for title VI, section 504, title IX, and the Age Act, found 
at 45 CFR parts 80, 84, 86 (subparts C and D), and 91 (subpart B), 
respectively. Where this paragraph (b) cross-references regulatory 
provisions that use the term ``recipient,'' the term ``recipient or 
State Exchange'' shall apply in its place. Where this paragraph (b) 
cross-references regulatory provisions that use the term ``student,'' 
``employee,'' or ``applicant,'' these terms shall be replaced with 
``individual.''
    (ii) The Department, including Federally-facilitated Exchanges, 
must comply with specific prohibitions on discrimination in the 
Department's implementing regulations for title VI, section 504, title 
IX, and the Age Act, found at 45 CFR parts 80, 85, 86 (subparts C and 
D), and 91 (subpart B), respectively. Where this paragraph (b) cross-
references regulatory provisions that use the term ``a recipient,'' the 
term ``the Department or a Federally-facilitated Exchange'' shall apply 
in its place. Where this paragraph (b) cross-references regulatory 
provisions that use the term ``student,'' ``employee,'' or 
``applicant,'' these terms shall be replaced with ``individual.''
    (2) The enumeration of specific prohibitions on discrimination in 
paragraph (b)(1) of this section does not limit the general 
applicability of the prohibition in paragraph (a) of this section.

Subpart C--Specific Applications to Health Programs and Activities


Sec.  92.201  Meaningful access for individuals with limited English 
proficiency.

    (a) General requirement. A covered entity must take reasonable 
steps to provide meaningful access to each individual with limited 
English proficiency (including companions with limited English 
proficiency) eligible to be served or likely to be directly affected by 
its health programs and activities.
    (b) Language assistance services requirements. Language assistance 
services required under paragraph (a) of this section must be provided 
free of charge, be accurate and timely, and protect the privacy and the 
independent decision-making ability of the individual with limited 
English proficiency.
    (c) Specific requirements for interpreter and translation services. 
(1) When interpretation services are required under this part, a 
covered entity must offer a qualified interpreter in its health 
programs and activities.
    (2) When translation services are required under this part, a 
covered entity must utilize the services of a qualified translator in 
its health programs and activities.
    (3) If a covered entity uses machine translation when the 
underlying text is critical to the rights, benefits, or meaningful 
access of an individual with limited English proficiency, when accuracy 
is essential, or when the source documents or materials contain 
complex, non-literal or technical language, the translation must be 
reviewed by a qualified human translator.
    (d) Evaluation of compliance. In evaluating whether a covered 
entity has met its obligation under paragraph (a) of this section, the 
Director shall:
    (1) Evaluate, and give substantial weight to, the nature and 
importance of the health program or activity and the particular 
communication at issue, to the individual with limited English 
proficiency; and
    (2) Take into account other relevant factors, including the 
effectiveness of the covered entity's written language access 
procedures for its health programs and activities, that the covered 
entity has implemented pursuant to Sec.  92.8(d).
    (e) Restricted use of certain persons to interpret or facilitate 
communication. A covered entity must not, in its health programs and 
activities:
    (1) Require an individual with limited English proficiency to 
provide their own interpreter, or to pay the cost of their own 
interpreter;
    (2) Rely on an adult, not qualified as an interpreter, to interpret 
or facilitate communication, except:
    (i) As a temporary measure, while finding a qualified interpreter 
in an emergency involving an imminent threat to the safety or welfare 
of an individual or the public where there is no qualified interpreter 
for the individual with limited English proficiency immediately 
available and the qualified interpreter that arrives confirms or 
supplements the initial communications with an initial adult 
interpreter; or
    (ii) Where the individual with limited English proficiency 
specifically requests, in private with a qualified interpreter present 
and without an accompanying adult present, that the accompanying adult 
interpret or facilitate communication, the accompanying adult agrees to 
provide such assistance, the request and agreement by the accompanying 
adult is documented, and reliance on that adult for such assistance is 
appropriate under the circumstances;
    (3) Rely on a minor child to interpret or facilitate communication, 
except as a temporary measure while finding a qualified interpreter in 
an emergency involving an imminent threat to the safety or welfare of 
an individual or the public where there is no qualified interpreter for 
the individual with limited English proficiency immediately available 
and the qualified interpreter that arrives confirms or supplements the 
initial communications with the minor child; or
    (4) Rely on staff other than qualified interpreters, qualified 
translators, or qualified bilingual/multilingual staff to communicate 
with individuals with limited English proficiency.
    (f) Video remote interpreting services. A covered entity that 
provides a qualified interpreter for an individual with limited English 
proficiency through video remote interpreting services in the covered 
entity's health programs and activities must ensure the modality allows 
for meaningful access and must provide:
    (1) Real-time, full-motion video and audio over a dedicated high-
speed, wide-bandwidth video connection or wireless connection that 
delivers high quality video images that do not produce lags, choppy, 
blurry, or grainy images, or irregular pauses in communication;
    (2) A sharply delineated image that is large enough to display the 
interpreter's face and the participating person's face regardless of 
the person's body position;
    (3) A clear, audible transmission of voices; and
    (4) Adequate training to users of the technology and other involved 
persons so that they may quickly and efficiently set up and operate the 
video remote interpreting.
    (g) Audio remote interpreting services. A covered entity that 
provides a qualified interpreter for an individual with limited English 
proficiency through audio remote interpreting

[[Page 37700]]

services in the covered entity's health programs and activities must 
ensure the modality allows for meaningful access and must provide:
    (1) Real-time audio over a dedicated high-speed, wide-bandwidth 
connection or wireless connection that delivers high-quality audio 
without lags or irregular pauses in communication;
    (2) A clear, audible transmission of voices; and
    (3) Adequate training to users of the technology and other involved 
persons so that they may quickly and efficiently set up and operate the 
remote interpreting services.
    (h) Acceptance of language assistance services is not required. 
Nothing in this section shall be construed to require an individual 
with limited English proficiency to accept language assistance 
services.


Sec.  92.202  Effective communication for individuals with 
disabilities.

    (a) A covered entity must take appropriate steps to ensure that 
communications with individuals with disabilities (including companions 
with disabilities), are as effective as communications with non-
disabled individuals in its health programs and activities, in 
accordance with the standards found at 28 CFR 35.130 and 35.160 through 
35.164. Where the regulatory provisions referenced in this section use 
the term ``public entity,'' the term ``covered entity'' shall apply in 
its place.
    (b) A covered entity must provide appropriate auxiliary aids and 
services where necessary to afford individuals with disabilities an 
equal opportunity to participate in, and enjoy the benefits of, the 
health program or activity in question. Such auxiliary aids and 
services must be provided free of charge, in accessible formats, in a 
timely manner, and in such a way to protect the privacy and the 
independence of the individual with a disability.


Sec.  92.203  Accessibility for buildings and facilities.

    (a) No qualified individual with a disability shall, because a 
covered entity's facilities are inaccessible to or unusable by 
individuals with disabilities, be denied the benefits of, be excluded 
from participation in, or otherwise be subjected to discrimination 
under any health program or activity to which this part applies.
    (b) Each facility or part of a facility in which health programs or 
activities are conducted that is constructed or altered by or on behalf 
of, or for the use of, a recipient or State Exchange must comply with 
the 2010 Standards if the construction or alteration was commenced on 
or after July 18, 2016, except that if a facility or part of a facility 
in which health programs or activities are conducted that is 
constructed or altered by or on behalf of, or for the use of, a 
recipient or State Exchange, was not covered by the 2010 Standards 
prior to July 18, 2016, such facility or part of a facility must comply 
with the 2010 Standards if the construction or alteration was commenced 
after January 18, 2018. If construction or alteration was begun on or 
after July 18, 2016, and on or before January 18, 2018, in conformance 
with UFAS, and the facility or part of the facility was not covered by 
the 2010 Standards prior to July 18, 2016, then it shall be deemed to 
comply with the requirements of this section and with 45 CFR 84.23(a) 
and (b). Departures from particular technical and scoping requirements 
by the use of other methods are permitted where substantially 
equivalent or greater access to and usability of the facility is 
provided. All newly constructed or altered buildings or facilities 
subject to this section must comply with the requirements for a 
``public building or facility'' as defined in section 106.5 of the 2010 
Standards.
    (c) Each facility or part of a facility in which health programs or 
activities under this part are conducted that is constructed or altered 
by or on behalf of, or for the use of, a recipient or State Exchange in 
conformance with the 1991 Standards at appendix D to 28 CFR part 36 or 
the 2010 Standards shall be deemed to comply with the requirements of 
this section and with 45 CFR 84.23(a) and (b) with respect to those 
facilities, if the construction or alteration was commenced before July 
18, 2016. Each facility or part of a facility in which health programs 
or activities are conducted that is constructed or altered by or on 
behalf of, or for the use of, a recipient or State Exchange in 
conformance with UFAS shall be deemed to comply with the requirements 
of this section and with 45 CFR 84.23(a) and (b), if the construction 
or alteration was commenced before July 18, 2016, and such facility 
would not have been required to conform with a different accessibility 
standard under 28 CFR 35.151.


Sec.  92.204  Accessibility of information and communication technology 
for individuals with disabilities.

    (a) A covered entity must ensure that its health programs and 
activities provided through information and communication technology 
are accessible to individuals with disabilities, unless doing so would 
result in undue financial and administrative burdens or a fundamental 
alteration in the nature of the health programs or activities. If an 
action required to comply with this section would result in such an 
alteration or such burdens, a covered entity shall take any other 
action that would not result in such an alteration or such burdens but 
would nevertheless ensure that, to the maximum extent possible, 
individuals with disabilities receive the benefits or services of the 
health program or activity provided by the covered entity.
    (b) A recipient or State Exchange shall ensure that its health 
programs and activities provided through websites and mobile 
applications comply with the requirements of section 504 of the 
Rehabilitation Act, as interpreted consistent with title II of the ADA 
(42 U.S.C. 12131 through 12165).


Sec.  92.205  Requirement to make reasonable modifications.

    A covered entity must make reasonable modifications to policies, 
practices, or procedures in its health programs and activities when 
such modifications are necessary to avoid discrimination on the basis 
of disability, unless the covered entity can demonstrate that making 
the modifications would fundamentally alter the nature of the health 
program or activity. For the purposes of this section, the term 
``reasonable modifications'' shall be interpreted in a manner 
consistent with the term as set forth in the ADA title II regulation at 
28 CFR 35.130(b)(7).


Sec.  92.206  Equal program access on the basis of sex.

    (a) A covered entity must provide individuals equal access to its 
health programs and activities without discriminating on the basis of 
sex.
    (b) In providing access to health programs and activities, a 
covered entity must not:
    (1) Deny or limit health services, including those that have been 
typically or exclusively provided to, or associated with, individuals 
of one sex, to an individual based upon the individual's sex assigned 
at birth, gender identity, or gender otherwise recorded;
    (2) Deny or limit, on the basis of an individual's sex assigned at 
birth, gender identity, or gender otherwise recorded, a health care 
professional's ability to provide health services if such denial or 
limitation has the effect of excluding individuals from participation 
in, denying them the benefits of, or otherwise subjecting them

[[Page 37701]]

to discrimination on the basis of sex under a covered health program or 
activity;
    (3) Adopt or apply any policy or practice of treating individuals 
differently or separating them on the basis of sex in a manner that 
subjects any individual to more than de minimis harm, including by 
adopting a policy or engaging in a practice that prevents an individual 
from participating in a health program or activity consistent with the 
individual's gender identity; or
    (4) Deny or limit health services sought for purpose of gender 
transition or other gender-affirming care that the covered entity would 
provide to an individual for other purposes if the denial or limitation 
is based on an individual's sex assigned at birth, gender identity, or 
gender otherwise recorded.
    (c) Nothing in this section requires the provision of any health 
service where the covered entity has a legitimate, nondiscriminatory 
reason for denying or limiting that service, including where the 
covered entity typically declines to provide the health service to any 
individual or where the covered entity reasonably determines that such 
health service is not clinically appropriate for a particular 
individual. A covered entity's determination must not be based on 
unlawful animus or bias, or constitute a pretext for discrimination. 
Nothing in this section is intended to preclude a covered entity from 
availing itself of protections described in Sec. Sec.  92.3 and 92.302.
    (d) The enumeration of specific forms of discrimination in 
paragraph (b) of this section does not limit the general applicability 
of the prohibition in paragraph (a) of this section.


Sec.  92.207  Nondiscrimination in health insurance coverage and other 
health-related coverage.

    (a) A covered entity must not, in providing or administering health 
insurance coverage or other health-related coverage, discriminate on 
the basis of race, color, national origin, sex, age, disability, or any 
combination thereof.
    (b) A covered entity must not, in providing or administering health 
insurance coverage or other health-related coverage:
    (1) Deny, cancel, limit, or refuse to issue or renew health 
insurance coverage or other health-related coverage, or deny or limit 
coverage of a claim, or impose additional cost sharing or other 
limitations or restrictions on coverage, on the basis of race, color, 
national origin, sex, age, disability, or any combination thereof;
    (2) Have or implement marketing practices or benefit designs that 
discriminate on the basis of race, color, national origin, sex, age, 
disability, or any combination thereof, in health insurance coverage or 
other health-related coverage;
    (3) Deny or limit coverage, deny or limit coverage of a claim, or 
impose additional cost sharing or other limitations or restrictions on 
coverage, to an individual based upon the individual's sex assigned at 
birth, gender identity, or gender otherwise recorded;
    (4) Have or implement a categorical coverage exclusion or 
limitation for all health services related to gender transition or 
other gender-affirming care;
    (5) Otherwise deny or limit coverage, deny or limit coverage of a 
claim, or impose additional cost sharing or other limitations or 
restrictions on coverage, for specific health services related to 
gender transition or other gender-affirming care if such denial, 
limitation, or restriction results in discrimination on the basis of 
sex; or
    (6) Have or implement benefit designs that do not provide or 
administer health insurance coverage or other health-related coverage 
in the most integrated setting appropriate to the needs of qualified 
individuals with disabilities, including practices that result in the 
serious risk of institutionalization or segregation.
    (c) Nothing in this section requires coverage of any health service 
where the covered entity has a legitimate, nondiscriminatory reason for 
denying or limiting coverage of the health service or determining that 
such health service fails to meet applicable coverage requirements, 
including reasonable medical management techniques such as medical 
necessity requirements. Such coverage denial or limitation must not be 
based on unlawful animus or bias, or constitute a pretext for 
discrimination. Nothing in this section is intended to preclude a 
covered entity from availing itself of protections described in 
Sec. Sec.  92.3 and 92.302.
    (d) The enumeration of specific forms of discrimination in 
paragraph (b) of this section does not limit the general applicability 
of the prohibition in paragraph (a) of this section.


Sec.  92.208  Prohibition on sex discrimination related to marital, 
parental, or family status.

    In determining whether an individual satisfies any policy or 
criterion regarding access to its health programs or activities, a 
covered entity must not take an individual's sex, as defined in Sec.  
92.101(a)(2), into account in applying any rule concerning an 
individual's current, perceived, potential, or past marital, parental, 
or family status.


Sec.  92.209  Nondiscrimination on the basis of association.

    A covered entity must not exclude from participation in, deny the 
benefits of, or otherwise discriminate against an individual or entity 
in its health programs and activities on the basis of the respective 
race, color, national origin, sex, age, or disability of the individual 
and another person with whom the individual or entity has a 
relationship or association.


Sec.  92.210  Nondiscrimination in the use of patient care decision 
support tools.

    (a) General prohibition. A covered entity must not discriminate on 
the basis of race, color, national origin, sex, age, or disability in 
its health programs or activities through the use of patient care 
decision support tools.
    (b) Identification of risk. A covered entity has an ongoing duty to 
make reasonable efforts to identify uses of patient care decision 
support tools in its health programs or activities that employ input 
variables or factors that measure race, color, national origin, sex, 
age, or disability.
    (c) Mitigation of risk. For each patient care decision support tool 
identified in paragraph (b) of this section, a covered entity must make 
reasonable efforts to mitigate the risk of discrimination resulting 
from the tool's use in its health programs or activities.


Sec.  92.211  Nondiscrimination in the delivery of health programs and 
activities through telehealth services.

    A covered entity must not, in delivery of its health programs and 
activities through telehealth services, discriminate on the basis of 
race, color, national origin, sex, age, or disability.

Subpart D--Procedures


Sec.  92.301  Enforcement mechanisms.

    The enforcement mechanisms available for and provided under title 
VI of the Civil Rights Act of 1964, title IX of the Education 
Amendments of 1972, section 504 of the Rehabilitation Act of 1973, and 
the Age Discrimination Act of 1975 shall apply for purposes of section 
1557 as implemented by this part.


Sec.  92.302  Notification of views regarding application of Federal 
religious freedom and conscience laws.

    (a) General application. A recipient may rely on applicable Federal 
protections for religious freedom and conscience, and consistent with 
Sec.  92.3(c), application of a particular

[[Page 37702]]

provision(s) of this part to specific contexts, procedures, or health 
care services shall not be required where such protections apply.
    (b) Assurance of religious freedom and conscience exemption. A 
recipient that seeks assurance consistent with paragraph (a) of this 
section regarding the application of particular provision(s) of this 
part to specific contexts, procedures, or health care services may do 
so by submitting a notification in writing to the Director of OCR. 
Notification may be provided by the recipient at any time, including 
before an investigation is initiated or during the pendency of an 
investigation. The notification must include:
    (1) The particular provision(s) of this part from which the 
recipient asserts they are exempt under Federal religious freedom or 
conscience protections;
    (2) The legal basis supporting the recipient's exemption should 
include the standards governing the applicable Federal religious 
freedom and conscience protections, such as the provisions in the ACA 
itself; the Church, Coats-Snowe, and Weldon Amendments; the generally 
applicable requirements of the Religious Freedom Restoration Act 
(RFRA); or any other applicable Federal laws; and
    (3) The factual basis supporting the recipient's exemption, 
including identification of the conflict between the recipient's 
religious or conscience beliefs and the requirements of this part, 
which may include the specific contexts, procedures, or health care 
services that the recipient asserts will violate their religious or 
conscience beliefs overall or based on an individual patient matter.
    (c) Temporary exemption. A temporary exemption from administrative 
investigation and enforcement will take effect upon the recipient's 
submission of the notification--regardless of whether the assurance is 
sought before or during an investigation. The temporary exemption is 
limited to the application of the particular provision(s) in this part 
as applied to the specific contexts, procedures, or health care 
services identified in the notification to OCR.
    (1) If the notification is received before an investigation is 
initiated, within 30 days of receiving the notification, OCR must 
provide the recipient with email confirmation acknowledging receipt of 
the notification. OCR will then work expeditiously to reach a 
determination of recipient's notification request.
    (2) If the notification is received during the pendency of an 
investigation, the temporary exemption will exempt conduct as applied 
to the specific contexts, procedures, or health care services 
identified in the notification during the pendency of OCR's review and 
determination regarding the notification request. The notification 
shall further serve as a defense to the relevant investigation or 
enforcement activity regarding the recipient until the final 
determination of recipient's exemption assurance request or the 
conclusion of the investigation.
    (d) Effect of determination. If OCR makes a determination to 
provide assurance of the recipient's exemption from the application of 
certain provision(s) of this part or that modified application of 
certain provision(s) is required, OCR will provide the recipient its 
determination in writing, and if granted, the recipient will be 
considered exempt from OCR's administrative investigation and 
enforcement with regard to the application of that provision(s) as 
applied to the specific contexts, procedures, or health care services 
provided. The determination does not otherwise limit the application of 
any other provision of this part to the recipient or to other contexts, 
procedures, or health care services.
    (e) Appeal. A recipient subject to an adverse determination of its 
request for an exemption assurance may appeal OCR's determination under 
the administrative procedures set forth at 45 CFR part 81. The 
temporary exemption provided for in paragraph (c) of this section will 
expire upon a final decision under 45 CFR part 81.
    (f) Final agency action. A determination under this section is not 
final for purposes of judicial review until after a final decision 
under 45 CFR part 81.


Sec.  92.303  Procedures for health programs and activities conducted 
by recipients and State Exchanges.

    (a) The procedural provisions applicable to title VI apply with 
respect to administrative enforcement actions against health programs 
and activities of recipients and State Exchanges concerning 
discrimination on the basis of race, color, national origin, sex, age, 
disability, or any combination thereof, under section 1557 or this 
part. These procedures are found at 45 CFR 80.6 through 80.11 and 45 
CFR part 81.
    (b) If OCR receives a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate Federal 
Government entity.
    (c) When a recipient or State Exchange fails to provide OCR with 
requested information in a timely, complete, and accurate manner, OCR 
may, after attempting to reach voluntary resolution, find noncompliance 
with section 1557 or this part and initiate appropriate enforcement 
procedures, found at 45 CFR 80.8, including beginning the process for 
fund suspension or termination and taking other action authorized by 
law.


Sec.  92.304  Procedures for health programs and activities 
administered by the Department.

    (a) The procedural provisions applicable to section 504 shall apply 
with respect to administrative enforcement actions against the 
Department, including Federally-facilitated Exchanges, concerning 
discrimination on the basis of race, color, national origin, sex, age, 
disability, or any combination thereof, under section 1557 or this 
part. These procedures are found at 45 CFR 85.61 and 85.62. Where this 
section cross-references regulatory provisions that use the term 
``handicap,'' the term ``race, color, national origin, sex, age, or 
disability, or any combination thereof,'' shall apply in its place.
    (b) The Department must permit access by OCR to its books, records, 
accounts, other sources of information, and facilities as may be 
pertinent to ascertain compliance with section 1557 or this part. Where 
any information required of the Department is in the exclusive 
possession of any other agency, institution or person, and the other 
agency, institution or person fails or refuses to furnish this 
information, the Department shall so certify and shall set forth what 
efforts it has made to obtain the information. Asserted considerations 
of privacy or confidentiality may not operate to bar OCR from 
evaluating or seeking to enforce compliance with section 1557 or this 
part. Information of a confidential nature obtained in connection with 
compliance evaluation or enforcement shall not be disclosed except 
where necessary under the law.
    (c) The Department must not intimidate, threaten, coerce, 
retaliate, or otherwise discriminate against any individual or entity 
for the purpose of interfering with any right or privilege secured by 
section 1557 or this part, or because such individual or entity has 
made a complaint, testified, assisted, or participated in any manner in 
an investigation, proceeding or hearing under section 1557 or this 
part. The identity of complainants must be kept confidential by OCR in 
accordance with applicable Federal law.

[[Page 37703]]

PART 147--HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND 
INDIVIDUAL HEALTH INSURANCE MARKETS

0
16. The authority citation for part 147 continues to read as follows:

    Authority:  42 U.S.C. 300gg through 300gg-63, 300gg-91, 300gg-
92, and 300gg-111 through 300gg-139, as amended, and section 3203, 
Pub. L. 116-136, 134 Stat. 281.

0
17. Amend Sec.  147.104 by revising paragraph (e) to read as follows:


Sec.  147.104  Guaranteed availability of coverage.

* * * * *
    (e) Marketing. A health insurance issuer and its officials, 
employees, agents and representatives must comply with any applicable 
State laws and regulations regarding marketing by health insurance 
issuers and cannot employ marketing practices or benefit designs that 
will have the effect of discouraging the enrollment of individuals with 
significant health needs in health insurance coverage or discriminate 
based on an individual's race, color, national origin, present or 
predicted disability, age, sex (which includes discrimination on the 
basis of sex characteristics, including intersex traits; pregnancy or 
related conditions; sexual orientation; gender identity; and sex 
stereotypes), expected length of life, degree of medical dependency, 
quality of life, or other health conditions.
* * * * *

PART 155--EXCHANGE ESTABLISHMENT STANDARDS AND OTHER RELATED 
STANDARDS UNDER THE AFFORDABLE CARE ACT

0
18. The authority citation for part 155 continues to read as follows:

    Authority:  42 U.S.C. 18021-18024, 18031-18033, 18041-18042, 
18051, 18054, 18071, and 18081-18083.

0
19. Amend Sec.  155.120 by revising paragraph (c)(1)(ii) to read as 
follows:


Sec.  155.120  Non-interference with Federal law and non-discrimination 
standards.

* * * * *
    (c) * * *
    (1) * * *
    (ii) Not discriminate based on race, color, national origin, 
disability, age, or sex (which includes discrimination on the basis of 
sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes).
* * * * *

0
20. Amend Sec.  155.220 by revising paragraph (j)(2)(i) to read as 
follows:


Sec.  155.220  Ability of States to permit agents and brokers and web-
brokers to assist qualified individuals, qualified employers, or 
qualified employees enrolling in QHPs.

* * * * *
    (j) * * *
    (2) * * *
    (i) Provide consumers with correct information, without omission of 
material fact, regarding the Federally-facilitated Exchanges, QHPs 
offered through the Federally-facilitated Exchanges, and insurance 
affordability programs, and refrain from marketing or conduct that is 
misleading (including by having a direct enrollment website that HHS 
determines could mislead a consumer into believing they are visiting 
HealthCare.gov), coercive, or discriminates based on race, color, 
national origin, disability, age, or sex (which includes discrimination 
on the basis of sex characteristics, including intersex traits; 
pregnancy or related conditions; sexual orientation; gender identity; 
and sex stereotypes);
* * * * *

PART 156--HEALTH INSURANCE ISSUER STANDARDS UNDER THE AFFORDABLE 
CARE ACT, INCLUDING STANDARDS RELATED TO EXCHANGES

0
21. The authority citation for part 156 continues to read as follows:

    Authority:  42 U.S.C. 18021-18024, 18031-18032, 18041-18042, 
18044, 18054, 18061, 18063, 18071, 18082, and 26 U.S.C. 36B.


0
22. Amend Sec.  156.200 by revising paragraph (e) to read as follows:


Sec.  156.200  QHP issuer participation standards.

* * * * *
    (e) Non-discrimination. A QHP issuer must not, with respect to its 
QHP, discriminate on the basis of race, color, national origin, 
disability, age, or sex (which includes discrimination on the basis of 
sex characteristics, including intersex traits; pregnancy or related 
conditions; sexual orientation; gender identity; and sex stereotypes).
* * * * *

0
23. Amend Sec.  156.1230 by revising paragraph (b)(2) to read as 
follows:


Sec.  156.1230  Direct enrollment with the QHP issuer in a manner 
considered to be through the Exchange.

* * * * *
    (b) * * *
    (2) The QHP issuer must provide consumers with correct information, 
without omission of material fact, regarding the Federally-facilitated 
Exchanges, QHPs offered through the Federally-facilitated Exchanges, 
and insurance affordability programs, and refrain from marketing or 
conduct that is misleading (including by having a direct enrollment 
website that HHS determines could mislead a consumer into believing 
they are visiting HealthCare.gov), coercive, or discriminates based on 
race, color, national origin, disability, age, or sex (which includes 
discrimination on the basis of sex characteristics, including intersex 
traits; pregnancy or related conditions; sexual orientation; gender 
identity; and sex stereotypes).

[FR Doc. 2024-08711 Filed 4-26-24; 4:15 pm]
 BILLING CODE 4153-01-P

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