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Attorney General Nessel Joins Lawsuit Against Federal Government for Allowing Health Care Discrimination

LANSING – Michigan Attorney General Dana Nessel has joined 22 other attorneys general in filing a lawsuit to stop the U.S. Department of Health and Human Services’ (HHS) finalized regulation, “Nondiscrimination in Health and Health Education Programs or Activities” (Section 1557 Rule) which rolls back protections put in place in 2016. Section 1557 is an anti-discrimination provision of the Affordable Care Act (ACA) that prohibits discrimination in health care based on gender, race, ethnicity, sex, age or disability. The lawsuit — filed Monday against HHS, HHS Secretary Alex Azar, and the head of HHS’s Office of Civil Rights, Roger Severino — argues that the new rule emboldens providers and insurers to discriminate against communities of color, women, LGBTQ individuals, those with limited English proficiency, and people with disabilities by undermining critical legal protections prohibiting discrimination in in the provision of health care services.

“By striking down anti-discrimination protections for women, minorities, LGBTQ individuals and others, this new rule exposes a deliberate and persistent theme of prejudice by our federal government under the Trump administration, and it is something I am obligated to oppose,” Nessel said. “The original intent behind the Section 1557 provision in the Affordable Care Act is to prevent discrimination in our nation’s health care system, yet this administration’s new rule instead revokes those protections and advances an agenda that welcomes bigotry. At a time when we’re reminded every day of how barriers to health care threaten the lives of adults and children alike, the federal government continues to show a blatant disregard for those most at risk. My colleagues and I have no other choice but to challenge this rule in court.”

Before the rule was finalized, the coalition previously called on the Trump administration to withdraw the rule.  The coalition submitted a comment letter to HHS in August, and then sent another letter to HHS in April asking that they not finalize the rule while the nation is in the midst of a public health crisis.

The Obama administration’s HHS issued regulations implementing Section 1557 of the ACA in 2016 to stop the ongoing threat of discrimination in the nation's health care system. HHS itself has long noted that discrimination within the health care system contributes to poor coverage and health outcomes, and exacerbates existing health disparities in underserved communities. Individuals who have experienced discrimination in health care often postpone or forgo needed care, resulting in adverse health outcomes.

Specifically, Section 1557 prohibits discrimination by any health care program — including providers and insurers — against individuals on the basis of race, color, national origin, sex, disability or age. Federal courts have also held that the statute’s prohibitions on sex discrimination protect transgender and other LGBTQ+ individuals from discrimination, which was confirmed in last month’s Supreme Court decision in Bostock v. Clayton County.  In Bostock, the Supreme Court held that discrimination based on sexual orientation and transgender status are forms of sex discrimination prohibited by federal civil rights law.

Despite numerous failed legislative and legal battles to repeal and dismantle the ACA, the current administration’s new rule would now eliminate many of the express protections contained in the Section 1557 regulations, unlawfully exclude many health insurers from Section 1557’s scope, and would allow health care providers and health insurers to deny care and insurance coverage. The new rule would also impose unreasonable barriers and impede timely access to health care for Americans, in violation of Section 1557 of the ACA.

In the lawsuit —  filed in the U.S. District Court for the Southern District of New York — the coalition argues that HHS has unlawfully ignored the harms that the new rule will impose on vulnerable populations. The coalition additionally contends that HHS has failed to justify why it abandoned its prior policy, which, among other things, explicitly prohibited discrimination in health care and required health entities to provide meaningful language assistance services to individuals with limited English proficiency, including notifying them of their rights to translation and interpretation services. The lawsuit also alleges that the Trump administration was motivated by animus toward the transgender community in issuing this rule.

The coalition specifically argues that the new rule is arbitrary, capricious and contrary to law under the Administrative Procedures Act (APA), and that it violates the equal protection guarantee of the Fifth Amendment.

Nessel joins the attorneys general of Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Wisconsin, and the District of Columbia in filing this lawsuit.

A copy of the complaint is available here.