Supreme Court's Ruling on LGBTQ+ May Supersede HHS Final Rule

by Peter Johnson

The Supreme Court's June 15 ruling on LGBTQ+ workforce protections in Bostock v. Clayton County, Georgia, could supersede a recently finalized rule by HHS's Office for Civil Rights (OCR) that stripped gender identity protections from anti-discrimination provisions in the Affordable Care Act (ACA), legal experts say.

In Bostock, the Court held that Title VII of the Civil Rights Act of 1964 protects employees from discrimination based on sexual orientation or gender identity. The case originated with Gerald Bostock, who sued his employer, Clayton County, when he was fired after mentioning that he was the member of a gay softball league.

"The Court is saying an employment decision based on sexual orientation or identification cannot be applied 'but for' the employee's biological sex," Raja Sekaran, a partner in Nossaman LLP and former HHS attorney, tells AIS Health via email.

"Granted, this is a relatively subtle point but is nonetheless the one on which the Court's decision turns, in my view," Sekaran explains. "In contrast, there is no such subtlety in the Trump Administration's [final rule] announcement.…In 2016, the Obama administration interpreted sex discrimination under the ACA to include discrimination based on gender identity. Last Friday, [HHS] reversed that position.…It is hard to see how this new final rule can stand in the wake of Bostock because upon application it invariably would fail the 'but for' test."

"This seems like an uphill battle for OCR," wrote health care attorney Katie Keith, principal at Keith Policy Solutions, LLC, in a blog post for Health Affairs. "We are likely left to waiting to see how various lower courts will now apply the Supreme Court's ruling…in other contexts."

In her post, Keith said that the ruling will likely have practical short-term implications for health plans and employers. She said employers may need to update their benefit design to be more inclusive of LGBTQ+ employees.

Keith suggested that the final rule could be withdrawn by HHS if its attorneys think Bostock makes it a moot point. But if it is not withdrawn, Keith said the open question of the ruling's impact on the final rule is likely to create a chaotic legal environment for health care stakeholders.

From Health Plan Weekly