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November 09, 2021
How Pandemic, Political Shifts Have Affected Affordable Care Act

By Jo Ellen Whitney

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Pandemic-related and political shifts regarding Section 1557 of the Affordable Care Act (ACA), the part that prohibits employer discrimination, have occurred over the last few years. Read on to learn what you need to know about (1) long-haul COVID-19 and disability discrimination and (2) the Biden administration’s approach to gender discrimination.

Background on ACA Section 1557

ACA Section 1557 is a multilayered approach prohibiting discrimination based on color, national origin, sex, age, and disability in health programs or “activities that receive federal financial assistance or are administered by an executive agency or an entity established under Title 1 of the [ACA].” It prohibits discrimination in both the provision of healthcare as well as insurance coverage.

Since the ACA became effective in 2010, the Office of Civil Rights (OCR) has initially investigated Section 1557 violations. The statute imposes several requirements to prevent discrimination in employee health benefits on any basis covered under the rules.

Since the ACA was implemented, it has been subjected to litigation, and various parts of it have ebbed, flowed, or completely gone away. Depending on which president is in control or who gets appointed to serve on the OCR or other federal agencies, the nature of the enforcement can differ substantially.

Long-Haul COVID and Section 1557

As a nation, we remain extremely busy trying to address emergent COVID-19 cases. The media haven’t paid as much attention to those who are battling “long-haul” or ongoing virus symptoms and face potential workplace or insurance discrimination.

In July 2021, the U.S. Department of Health and Human Services (HHS) through the OCR and the U.S. Department of Justice (DOJ) issued joint guidance indicating long-haul COVID-19 could be considered a disability under:

  • The Americans with Disabilities Act (ADA);
  • Section 504 of the Rehabilitation Act; and
  • Section 1557.

You can assume the Equal Employment Opportunity Commission (EEOC) also will use the guidance in later determinations about disability issues filed with the agency.

The guidance listed a significant number of symptoms potentially indicating long-haul COVID ranging from tiredness and muscle pain to the loss of taste or smell. It noted the ADA will come into play if any individual symptom or combination thereof substantially limits one or more major life activities.

In assessing long-haul COVID and the applicability of the antidiscrimination rules, the guidance focused more on permanent organ damage such as lung damage, kidney damage, or neurological issues than what may be shorter-term symptoms. It noted, however, a mental health condition also could also be caused by the virus and then would be covered under the ADA. Under Section 1557, health plans wouldn’t be able to discriminate against the condition.

The guidance noted that as with any other ADA, Section 1557, or Section 504 claims, “individualized assessment” will be necessary because long COVID (or other symptomology) isn’t always a disability.

Gender Discrimination Issues

Under the Trump administration, Section 1557’s applicability was narrowed, particularly in relation to nondiscrimination based on gender identity and sexual orientation. As a result, a significant number of lawsuits challenged various issues including whether benefit plans should cover gender identity treatments and whether they would be classified as “mental health and counseling” or “gender reassignment surgery.”

The Biden administration has taken a number of steps, announcing:

  • The HHS and the OCR now view gender identity and sexual orientation as part of their enforcement plan for Section 1557; and
  • Additional rulemaking will occur.

Some of the various pieces of litigation are on hold while others remain active as the scope of the rule and the OCR’s enforcement agenda are clarified.

Bottom Line For Employers

The HHS, OCR, and DOJ guidance is only a few months old, and the gender identity and sexual orientation regulations haven’t been issued yet. In the meantime, you should continue to:

  • Review and, as needed, update existing ADA policies, and apply them carefully and consistently. While any ADA issue requires an individualized assessment, consistency in the rules and their application is also important.
  • Assess health plan changes and covered procedures with the new guidance in mind.

Jo Ellen Whitney is an attorney with the Denton Davis Brown in Des Moines, Iowa. Jo Ellen handles a variety of issues ranging from business planning and contracts to representation before administrative agencies such as the Iowa Civil Rights Commission, the EEOC, Iowa Workforce Development, OSHA, and the Department of Labor, as well as state and federal courts.  You can reach her at joellen.whitney@dentons.com.

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