Federal Judge Blocks Repeal of Protections for Transgender Patients under Affordable Care Act

By Published On: August 25, 2020

The day before federal regulations reversing protections for transgender patients were to go into effect, a federal judge in New York temporarily blocked enforcement of the regulations.  The regulations, issued by the Office for Civil Rights’ (OCR), implement Section 1557, the nondiscrimination provision of the Patient Protection and Affordable Care Act (“Section 1557”).

Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in “any health program or activity” by incorporating other federal statutes, including:

  • Title VI of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color and national origin;
  • Title IX of the Education Amendments of 1972, which prohibits discrimination on the basis of sex;
  • Section 504 of the Rehabilitation Act of 1973, which prohibits discrimination on the basis of disability; and
  • Age Discrimination Act of 1974, which prohibits discrimination on the basis of age.

In 2016, OCR issued regulations (the “2016 Rules”), which prohibited discrimination “on the basis of sex” and defined “on the basis of sex” to include gender identity and sex stereotyping.  The 2016 Rules required insurance companies to cover and health care providers to offer medical care for transgender patients.  The 2016 Rules were challenged by several states and health care providers and, within months of going into effect, a federal district court issued a nationwide injunction to block enforcement of the portions of the 2016 Rules related to the definition of “on the basis of sex.”

On June 12, 2020, OCR announced revisions to the Section 1557 regulations (the “2020 Rules”) (for more on these revisions, see FTLF’s blog on the 2020 Rules).  In the 2020 Rules, OCR repealed the definition of “on the basis of sex,” stating that neither the Section 1557 statute nor Title IX prohibit discrimination on the basis of sexual orientation or gender identity or define “discrimination on the basis of sex” to include sexual orientation or gender identity.  By repealing the definition of “on the basis of sex,” OCR eliminated protections for transgender patients under the 2016 Rules.

On June 15, 2020, the Supreme Court ruled that the prohibition against discrimination “based on sex” under Title VII of the Civil Rights Act (Title VII) prohibits employers from discriminating against transgender people in the workplace. (Bostock v. Clayton Cnty, Ga., 140 S. Ct. 1731 (2020)).  The Supreme Court decision established that discrimination based on sexual orientation and gender identity is prohibited under Title VII’s prohibition on discrimination “based on sex.”

Scheduled to go into effect on August 18, 2020, the 2020 Rules were challenged in several courts by a variety of individuals and entities, including patients, health care providers, LGBTQ organizations, and 22 states and the District of Columbia.  On August 17, 2020, the U.S. District Court of the Eastern District of New York concluded that the 2020 Rules were contrary to the Supreme Court’s decision in Bostock and OCR acted arbitrarily and capriciously in enacting the 2020 Rules.  The court granted a stay and preliminary injunction to preclude the relevant sections of the 2020 Rules from becoming operative.  The court will next review briefs and hear arguments from both sides before issuing a final opinion.