- On May 28, 2025
The U.S. Department of Health and Human Services (HHS) recently rescinded its Section 1557 interpretation and enforcement guidance from May 10, 2021, effective immediately. According to HHS, the rescission is part of an agency-wide initiative to reduce regulatory burdens in accordance with the Trump administration’s policies, and the guidance no longer represents the agency’s legal views.
Background
Section 1557 of the Affordable Care Act prohibits discrimination based on race, color, national origin, sex, age, or disability in certain health programs and activities. It has been in effect since its enactment in 2010, and HHS’ Office of Civil Rights (OCR) enforces the provision.
The rules and guidance HHS has published to implement Section 1557 have been the subject of numerous lawsuits, dating back to when initial regulations were issued in 2016. The litigation has primarily focused on:
- Which health programs and activities are subject to Section 1557’s nondiscrimination requirements; and
- Whether sex discrimination includes discrimination based on gender identity, sexual orientation, and termination of pregnancy.
Rescinded Guidance from 2021
The 2021 HHS guidance was issued after the U.S. Supreme Court’s June 2020 ruling in Bostock v. Clayton County, where the Court held that employment discrimination based on gender identity or sexual orientation violates federal law.
Effective May 10, 2021, HHS announced in its guidance that it would interpret and enforce Section 1557’s prohibition on sex discrimination to include discrimination based on sexual orientation and gender identity, consistent with the Supreme Court’s Bostock decision. At the time, HHS stated that the interpretation would guide the OCR in processing complaints and conducting investigations, but noted that the interpretation would not determine the outcome in any particular case or set of facts on its own.
Action Steps
While the rescission of the 2021 guidance does not appear to impact the most recent iteration of the Section 1557 final regulations from 2024, implementation of those regulations remains in flux as federal courts have blocked enforcement of certain provisions relating to how the rule defines sex-based discrimination. Thus, plan administrators and issuers should continue monitoring all developments in this area and work closely with their advisors to comply with their Section 1557 obligations.