Obamacare Discrimination Ban Delayed in Final Rule for Insurers

The HHS delayed a controversial ban on discrimination in health care that would strengthen protections for the LGBT community in a Thursday final rule setting parameters for insurers under Obamacare.

Health insurers will need to post standardized costs for their plans offered on Healthcare.gov under the rule.

The Department of Health and Human Services is set to come out with a separate rule strengthening Section 1557 of the Affordable Care Act in the coming months. The agency said it was “prudent” to address the discrimination issue at a later time. Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability by entities that primarily provide health care and receive federal funding.

Other provisions in the Centers for Medicare & Medicaid Services rule (RIN 0938-AU65) will require insurers to post maximum out-of-pocket costs, deductibles, and cost-sharing to allow consumers to “more directly compare other important plan attributes, such as premiums, provider networks, prescription drug coverage, and quality ratings.” Health insurers designing and marketing their plans would be subject to the rule.

The rule also will require insurers in the federal health marketplace to ensure they have certain types of health-care providers available within certain geographical boundaries.

“By including new standardized plan options on HealthCare.gov, we are making it even easier for consumers to compare quality and value across health care plans,” Health and Human Services Secretary Xavier Becerra said in a statement.

“These steps increase the value of health care coverage on HealthCare.Gov and further strengthen the health insurance Marketplace,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “This policy will make it easier for people to choose the best plan that meets their needs by standardizing plan options, like maximum out-of-pocket limitations, deductibles, and cost-sharing features.”

The rule will take effect 60 days after being published in the Federal Register.

Delay Called ‘Prudent’

The HHS removed a provision from the final rule that would have banned discrimination in health insurance coverage, including in the design and marketing of plans. The department said it did so because it decided “it would be most prudent” to address them “at a later time, to ensure that they are consistent with the policies and requirements that will be included in the section 1557 rulemaking.”

The HHS said in its proposal that the change could “lead to improved health outcomes for this community and that the removal of such protections in the 2020 section 1557 final rule frustrated not only guaranteed availability requirements, but also the broader aim of improving health equity.”

The Biden administration announced in May 2021 that it would interpret “sex” in the ACA to include gender identity in light of the U.S. Supreme Court’s decision in Bostock v. Clayton County, which held that LGBT people are protected from discrimination under Title VII of the Civil Rights Act of 1964.