States Sue Trump Administration for Changing Nondiscrimination Provisions of ACA

July 21, 2020

The attorneys general who spoke about the suit—California’s Xavier Becerra, Massachusetts’ Maura Healey, and New York’s Leticia James—said they found it difficult to believe that the administration would adopt the rule in the midst of the coronavirus disease 2019, which is disproportionately affecting communities of color.

A coalition of 23 states sued the Trump administration Monday over an HHS rule, set to take affect next month, that would end health care discrimination protections for LGBTQ people, individuals with limited English proficiency (LEP), and women who have had abortions.

The suit was filed in the Southern District of New York, led by the attorneys general of New York, Massachusetts, and California. It asks that the rule relating to Section 1557 of the Affordable Care Act (ACA) be set aside because it is “is arbitrary, capricious, an abuse of discretion, or not in accordance with law.” Section 1557 of the ACA, which prohibits discrimination on the basis of race, color, national origin, sex, age, or disability, was expanded in 2016 by the Obama administration to include gender identity. Health care providers and insurers that accept federal funding were barred from denying services based on gender identity. The regulation said that individuals "must be treated consistent with their gender identity, including in access to facilities." In addition, providers and insurers were not allowed to discriminate against individuals on the basis of "termination of pregnancy."

In promulgating the rule last month, HHS said it was abiding by a decision by the US District Court for the Northern District of Texas, which ruled in favor of a religious organization that had sued the federal government in 2016 over the rule. HHS said it took the position that gender only meant the biological sex assigned at birth, either male or female.

HHS claimed that the rule change would save nearly $3 billion a year, primarily from eliminating the LEP requirements that notices be published in the top 15 languages of each state and other requirements. The change also exempted insurers from Section 1557, saying payers are not engaged in health care activity.

The attorneys general who spoke about the suit—California’s Xavier Becerra, Massachusetts’ Maura Healey, and New York’s Leticia James—said they found it difficult to believe that the administration would adopt the rule in the midst of the coronavirus disease 2019 (COVID-19), which is disproportionately affecting communities of color.

"It is more important than ever that everyone can access essential health care," said Becerra. He also said the rule "authorizes discrimination" at a time when the country is reeling from the pandemic, calling the move "unbelievably immoral."

The suit names Alex Azar, the HHS secretary, as well as Roger Severino, the director of the Office for Civil Rights (OCR) within the department. Severino became director of the HHS OCR in 2017, and launched a new Conscience and Religious Freedom Division. Another rule HHS changed would allow health care providers to deny services to some populations if they believed the services would violate their beliefs.

HHS published the rule a few days after the Supreme Court ruled 6-3 that transgender workers are protected under Title VII of the Civil Rights Act of 1964. The issues are related, said the state officials, who said they think the ruling will make the changes harder to defend.

Joining the suit are Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Wisconsin, and the District of Columbia.

Washington state has already sued HHS over the rule, as have a number of LGBTQ organizations and the Human Rights Campaign.