Summary of Section 1557 of the Affordable Care Act and Application for Health Systems, Medical Practices, and Clinical Research

The United States Department of Health and Human Services (HHS) has issued a final rule under Section 1557 of the Affordable Care Act (ACA) to strengthen nondiscrimination protections and advance civil rights in healthcare.   The new rule is effective July 5, 2024 and applies to all healthcare providers who bill Medicare, Medicaid or see patients who are insured through a ACA exchange plan.

This comprehensive rule impacts health systems and medical practices significantly by enforcing a range of compliance requirements. We recently interviewed Alexandra Moylan and Stefanie Doyle, attorneys at Baker Donelson, on key aspects of the rule, its implications for healthcare providers, and practical steps for compliance. The information is drawn from various sources, including HHS, the interviews, and other relevant documentation.  This is the third rule that has been issued on this section but by far the most comprehensive.

Overview of Section 1557

Section 1557 is the ACA’s nondiscrimination provision, which prohibits discrimination based on race, color, national origin, sex, age, or disability, in health programs and activities that receive federal financial assistance. This includes State-based health insurance Exchanges and HHS health programs and activities. The rule aims to ensure nondiscriminatory access to healthcare for all, including women, people with disabilities, LGBTQI+ individuals, people with limited English proficiency (LEP), and people of color​​​​.

Key Provisions of the Final Rule

Inclusion of Medicare Part B

The new rule considers Medicare Part B payments to be federal financial assistance. This means that healthcare providers and suppliers receiving Part B funds are now subject to nondiscrimination standards under Section 1557. This extension ensures broader coverage and protection against discrimination in healthcare settings​​.

Language Assistance and Accessibility Services

Covered entities must provide language assistance services and auxiliary aids at no cost to patients. Notices must be provided in English and the top 15 languages spoken by individuals with LEP in the relevant state(s). These notices must be effectively communicated to individuals with disabilities and displayed prominently both physically and on the entities’ websites​​​​.  HHS has provided resources for covered entities including translation of the notice into multiple languages.

Telehealth Services

Nondiscrimination requirements are explicitly extended to telehealth services, ensuring that these services are accessible to individuals with LEP and disabilities. This provision aims to enhance the inclusivity and accessibility of telehealth platforms​​.

Protections for LGBTQI+ Patients

The rule also clarifies that protections against sex discrimination include sexual orientation and gender identity. This provision aims to protect LGBTQI+ patients from discrimination and ensure they receive equitable health care services​​​​.

Use of AI and Decision-Support Tools

The rule requires covered entities to take reasonable steps to identify and mitigate discrimination when using patient care decision-support tools, including artificial intelligence (AI) and other automated tools. This addresses potential biases in clinical decision-making tools and aims to ensure fair treatment for all patients​​.

Compliance Requirements and Deadlines

Designation of a Section 1557 Coordinator

Healthcare providers with 15 or more employees must designate a Section 1557 Coordinator within 120 days of the effective date, by November 2, 2024. The coordinator will oversee compliance efforts and handle complaints related to discrimination.

Policy Implementation

Providers must implement policies and procedures to comply with Section 1557 within one year of the effective date, by July 5, 2025. These policies should cover language assistance services, effective communication for individuals with disabilities, and nondiscrimination practices.

Training Requirements

Providers must train their staff on the new policies and procedures. Providers must begin training their staff on the new policies and procedures  no later than 300 days following the effective date of policy implementation, or by May 1, 2026. Documentation of training must be retained for at least three years.

Key Compliance Deadlines

• Effective Date of the Rule: July 5, 2024
• Section 1557 Coordinator: Designation required within 120 days of the effective date, by November 2, 2024
• Policy Implementation: Required within one year of the effective date, by July 5, 2025
• Training Requirements: Providers must begin training no later than 300 days following the effective date, by May 1, 2025
• Notice of Nondiscrimination: Must be provided within 120 days of the effective date, by November 2, 2024
• Notice of Availability of Language Assistance Services and Auxiliary Aids: Required within one year of the effective date, by July 5, 2025

Practical Steps for Compliance

Establishing a Section 1557 Coordinator

Healthcare providers should identify an appropriate staff member, such as a compliance officer or HR director, to serve as the Section 1557 Coordinator. This individual will be responsible for overseeing compliance with the rule, investigating complaints, and ensuring that nondiscrimination policies are effectively implemented​​.

Developing and Implementing Policies

Providers must develop comprehensive policies that address all aspects of Section 1557 compliance. These policies should include procedures for providing language assistance services, ensuring effective communication with individuals with disabilities, and preventing discrimination based on sex, race, color, national origin, age, or disability​​.

Training Staff

Staff training is crucial to ensure that all employees understand the new policies and their responsibilities under Section 1557. Training programs should cover language assistance services, nondiscrimination practices, and the use of AI and decision-support tools. Providers should document all training activities and retain records for compliance audits​​.

Impact on Health Systems and Medical Practices

Operational Changes

Health systems and medical practices will need to make significant operational changes to comply with the new rule. This includes updating policies, training staff, and implementing new procedures for language assistance and accessibility services. These changes will require time and resources, but they are essential to ensure compliance and avoid potential penalties​​​​.

Financial Implications

The financial impact of the new rule will vary depending on the size and complexity of the healthcare provider. Smaller practices may face challenges in implementing the required changes due to limited resources. However, the rule allows for flexibility based on the provider’s size and resources, ensuring that smaller practices are not unduly burdened​​.

Legal and Compliance Risks

Healthcare providers must be vigilant in ensuring compliance with the new rule to avoid legal and compliance risks. Noncompliance can result in investigations by the Office for Civil Rights (OCR), potential loss of federal funding, and legal action by patients. Providers should establish robust compliance programs and regularly review their practices to mitigate these risks​​.

Addressing Challenges and Enhancing Compliance

Leveraging Technology

Healthcare providers can leverage technology to enhance compliance with the new rule. For example, telehealth platforms can be equipped with features to ensure accessibility for individuals with LEP and disabilities. Additionally, AI tools used in clinical decision-making should be regularly reviewed and updated to mitigate potential biases​​.

Engaging Stakeholders

Engaging stakeholders, including patients, advocacy groups, and community organizations, can help healthcare providers better understand and address the needs of diverse patient populations. This collaborative approach can enhance the effectiveness of nondiscrimination policies and improve patient satisfaction​​.

Continuous Monitoring and Improvement

Continuous monitoring and improvement are essential for maintaining compliance with Section 1557. Healthcare providers should regularly review their policies, procedures, and practices to identify areas for improvement. Feedback from patients and staff can provide valuable insights for enhancing compliance efforts​​.

The Rule’s Effect on Decision-Support Tools and Apps

The final rule under Section 1557 also addresses the use of patient care decision-support tools, including those utilizing AI. According to Alex Moylan, a shareholder at Baker Donaldson, “The rule is going to apply to any kind of AI tools that healthcare providers incorporate into their operations that might affect clinical decision-making. This could also include algorithms or automated tools that they have been using previously”​​. Providers must inventory these tools and ensure they comply with nondiscrimination requirements.

The concern is that AI and automated tools can inherently contain biases, as they are often trained on data that predominantly represents certain demographic groups, such as Caucasians, leading to potential discriminatory outputs. Moylan elaborates, “There is a great risk for bias because the data used to train the tools can be inherently biased. OCR requires reasonable efforts to mitigate these risks, including evaluating the tools, understanding their development, and monitoring for discriminatory outputs”​​.

For smaller practices, like a 20-person oncology practice in Raleigh, North Carolina, the requirements might seem overwhelming. However, the OCR considers the resources and capabilities of the provider when evaluating compliance. Moylan notes, “They will look at your situation on a case-by-case basis and won’t expect you to have the same resources as a large academic institution”​​.

Practical Steps for Handling AI and Decision-Support Tools

1. Inventory Existing Tools: Identify all AI and automated decision-support tools in use.
2. Evaluate for Bias: Review the tools for potential biases and discriminatory outputs.
3. Implement Governance: Establish processes for using, monitoring, and evaluating these tools.
4. Training: Ensure staff are trained on the use and potential risks associated with these tools.
5. Compliance Documentation: Keep records of evaluations and any actions taken to mitigate risks.

Clinical Trial Requirements in the Final Rule of Section 1557

The final rule under Section 1557 of the Affordable Care Act (ACA) addresses nondiscrimination in health programs and activities receiving federal financial assistance. Notably, the rule includes specific provisions regarding clinical trials. According to the rule, clinical trial sites must comply with nondiscrimination requirements, ensuring equitable access and treatment for all participants regardless of race, color, national origin, sex, age, or disability. However, there are nuanced aspects to these requirements that clinical trial sites should be aware of:

1. Language Assistance and Informed Consent: The rule mandates that clinical trial sites provide language assistance services and auxiliary aids to ensure effective communication with participants who have limited English proficiency (LEP) or disabilities. This includes translating informed consent documents into the primary languages of participants to ensure they fully understand the trial and its implications.
2. Participant Selection and Enrollment: Clinical trial sites must ensure that their participant selection and enrollment processes do not discriminate based on race, color, national origin, sex, age, or disability. This means actively working to include diverse populations in clinical trials to avoid bias and ensure that the benefits of research are equitably distributed.
3. Compliance and Monitoring: Sites must implement policies and procedures to comply with Section 1557, including appointing a Section 1557 Coordinator to oversee compliance efforts. This coordinator will be responsible for addressing complaints related to discrimination and ensuring that the site adheres to the rule’s requirements.

While the rule does not specifically mention exemptions for clinical trials, it emphasizes the importance of nondiscrimination and equitable access in all federally funded health programs and activities, including clinical trials. Clinical trial sites must integrate these requirements into their operational protocols to ensure compliance and promote inclusivity in their research efforts.

The Rule’s Effect on Decision-Support Tools and Apps

The final rule under Section 1557 also addresses the use of patient care decision-support tools, including those utilizing artificial intelligence (AI). According to Alex Moylan, a Shareholder at Baker Donelson, “The rule is going to apply to any kind of AI tools that healthcare providers incorporate into their operations that might affect clinical decision-making. This includes algorithms or automated tools that they have been using previously and continue to use”. Providers must inventory these tools and ensure they comply with nondiscrimination requirements.

The concern is that AI and automated tools can inherently contain biases, as they are often trained on data that predominantly represents certain demographic groups, such as Caucasians, leading to potential discriminatory outputs. Moylan elaborates, “There is a great risk for bias because the data used to train the tools can be inherently biased. OCR requires reasonable efforts to mitigate these risks, including evaluating the tools, understanding their development, and monitoring for discriminatory outputs.”

For smaller practices, like a 20-person oncology practice in Raleigh, North Carolina, the requirements might seem overwhelming. However, the OCR considers the resources and capabilities of the provider when evaluating compliance. Moylan notes, “They will look at your situation on a case-by-case basis and won’t expect you to have the same resources as a large academic medical institution.”

Practical Steps for Handling AI and Decision-Support Tools

1. Inventory Existing Tools: Identify all AI and automated decision-support tools in use.
2. Evaluate for Bias: Review the tools for potential biases and discriminatory outputs.
3. Implement Governance: Establish processes for using, monitoring, and evaluating these tools.
4. Training: Ensure staff are trained on the use and potential risks associated with these tools.
5. Compliance Documentation: Keep records of evaluations and any actions taken to mitigate risks.

Clinical Trial Requirements in the Final Rule of Section 1557

The final rule under Section 1557 of the Affordable Care Act (ACA) addresses nondiscrimination in health programs and activities receiving federal financial assistance. Notably, the rule includes specific provisions regarding clinical trials. According to the rule, clinical trial sites must comply with nondiscrimination requirements, ensuring equitable access and treatment for all participants regardless of race, color, national origin, sex, age, or disability. However, there are nuanced aspects to these requirements that clinical trial sites should be aware of:

1. Language Assistance and Informed Consent: The rule mandates that clinical trial sites provide language assistance services and auxiliary aids to ensure effective communication with participants who have limited English proficiency (LEP) or disabilities. This includes translating informed consent documents into the primary languages of participants to ensure they fully understand the trial and its implications.
2. Participant Selection and Enrollment: Clinical trial sites must ensure that their participant selection and enrollment processes do not discriminate based on race, color, national origin, sex, age, or disability. This means actively working to include diverse populations in clinical trials to avoid bias and ensure that the benefits of research are equitably distributed.
3. Compliance and Monitoring: Sites must implement policies and procedures to comply with Section 1557, including appointing a Section 1557 Coordinator to oversee compliance efforts. This coordinator will be responsible for addressing complaints related to discrimination and ensuring that the site adheres to the rule’s requirements.

While the rule does not specifically mention exemptions for clinical trials, it emphasizes the importance of nondiscrimination and equitable access in all federally funded health programs and activities, including clinical trials. Clinical trial sites must integrate these requirements into their operational protocols to ensure compliance and promote inclusivity in their research efforts.

Insights from Experts

Moylan emphasized the importance of complying with the new rule’s requirements, particularly regarding AI and automated tools. Moylan stated, “What OCR has done is in the rule they used the term reasonable efforts and they’ve defined what they mean by that. So, have you used the tool in a manner or under conditions which the developer intended for it to be used? Did you receive any product information from the developer of the tool that there is a potential for discrimination in input variables?”​​.

Conclusion

The final rule under Section 1557 of the ACA represents a significant step toward strengthening nondiscrimination protections and advancing civil rights in healthcare. While the new requirements will pose challenges for health systems and medical practices, they are essential to ensure equitable access to healthcare for all individuals. By understanding the key provisions, compliance requirements, and practical steps for implementation, healthcare providers can effectively navigate the changes and fulfill their obligations under the new rule.

For more detailed information on the rule and its requirements, you can refer to the following resources:

• HHS Issues New Rule to Strengthen Nondiscrimination Protections
• Section 1557 Fact Sheet
• Section 1557 FAQs
• Federal Register Notice
• Resources for Providers
• Appendix A: Top 15 Non-English Languages by State
• Legal 1557 FAQ’s from the Health Law Group
• Congressional Research Service Report on History of  ACA 1557
• Ten Takeaways from ACA 1557
• ACA 1557 effect on Healthcare Artificial Intelligence 

To receive updates including information on an upcoming webinar and more information on ACA1577 training for your organization, send an email to tsullivan@clinicaloptions.com