15 Oct New HHS Affordable Care Act Rule May Still be Valid After Bostock

On June 12, 2020, the U.S. Department of Health and Human Services (“HHS”) finalized a rule that, in pertinent part, repealed an Obama-era rule related to the nondiscrimination provisions of the Affordable Care Act (“ACA”).

The ACA provides that an individual shall not, on the grounds prohibited under Title VII of the Civil Rights Act of 1964, Title IX of the Education Amendments of 1972, the Rehabilitation Act of 1973, or the Age Discrimination Act of 1975, 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 aid, or under any program or activity that is administered by a federal executive agency. This means discrimination on the basis of race, color, national origin, sex, disability, and age is prohibited. The Obama-era rule added sexual orientation and gender identity to this list of protected classes based on HHS’s then-interpretation that these two classes were included in the definition of sex.

The new HHS rule effectively removes sexual orientation and gender identity from ACA regulations, and HHS takes the position that sex does not include sexual orientation and gender identity. Based on a plain reading of the new rule as well as statements made in the executive summary of the rule, it appears HHS is attempting to maneuver around the Supreme Court’s subsequent decision in Bostock v. Clayton County, 590 U.S. ___ (2020), which held that “sex” under Title VII included sexual orientation and gender identity [blog post on Bostock]. The rule attempts to avoid the Bostock decision by using the definition of “sex” under the Title IX education amendments instead of Title VII (notably, the Court has not decided whether sexual orientation or gender identity are including in “sex” under Title IX).

Prior to issuing this rule, one public commenter raised the issue of Bostock’s pendency and urged HHS to wait for the Court’s decision before issuing the final rule. HHS responded by noting that the Court’s decision would be on Title VII, not Title IX, and that HHS’ stance is that the plain meaning of “sex” under Title IX does not include sexual orientation or gender identity. HHS acknowledged that the decision in Bostock may influence the Court’s future interpretation of “sex” in the context of Title IX, but noted that biological sex takes on a “special importance” in the health context and that those implications may not be properly addressed by future Title VII rulings, including Bostock.

It is currently unclear how courts will handle the HHS rule in light of Bostock; however, as HHS acknowledged, Title VII cases are a persuasive authority for Title IX cases.