Section 1557 of the Affordable Care Act: Who Must Comply and How

Section 1557 of the Affordable Care Act applies to three groups: any health program or activity that receives federal financial assistance from the Department of Health and Human Services, any health program or activity that HHS itself administers, and any entity established under Title I of the ACA, such as the state and federal health insurance marketplaces.¹ Together these are called “covered entities,” and if you fall into any one of the three, the law’s prohibitions on discrimination based on race, color, national origin, sex, age, and disability apply to you.²

Recipients of Federal Financial Assistance From HHS

The first and largest category is any health program or activity that gets HHS funding, whether directly or indirectly. That includes hospitals that accept Medicare, physicians and clinics that receive Medicaid payments, community health centers funded through HHS grants, and health insurance issuers that participate in the ACA marketplace and receive premium tax credits or cost-sharing reductions on behalf of enrollees.³

The reach inside each organization is deliberately wide. If any portion of an entity’s operations receives federal funding, all of its health programs and activities fall under Section 1557.¹ For health insurance issuers, the effect is even broader: if the issuer sells at least one plan on the marketplace and receives federal subsidies for enrollees, every health plan it sells is covered, not just the marketplace plans.³

Programs HHS Administers Directly

The second category covers federal health programs that HHS itself operates rather than funding through a grant to someone else. Medicare Part D is an example.¹ These programs are bound by Section 1557 because the federal government is running them, not because a separate recipient is drawing federal dollars.

Title I Entities: The ACA Marketplaces

The third category is any entity established under Title I of the Affordable Care Act. In practice, that means the state-based and federally facilitated health insurance marketplaces where individuals and small employers shop for coverage.¹ These entities are covered whether or not they receive HHS funding, because the ACA itself created them.

Medicare Part B Providers: What Changed in 2024

For years, HHS took the position that Medicare Part B payments were not “federal financial assistance” for civil rights purposes. That interpretation kept many small physician practices, outpatient clinics, and specialists outside Section 1557’s reach if the only federal money they touched was Part B reimbursement.

HHS reversed that position in the 2024 final rule. The agency concluded that because the federal government covers roughly half the cost of Part B benefits, Part B payments are functionally the same as Part A funding, which has long triggered Section 1557 obligations.¹ Providers whose only federal program participation was Medicare Part B had until May 2025 to come into full compliance. If you accept Part B and had assumed Section 1557 didn’t apply to you, that assumption is no longer safe.

Who Isn’t Covered

Section 1557 is tied to federal funding and to HHS programs. A health provider that accepts no federal money and does not participate in any HHS-administered program falls outside the statute’s coverage. State laws or the underlying civil rights statutes may still reach that provider on other grounds, but Section 1557 itself does not. State laws offering broader anti-discrimination protection in healthcare remain in force alongside the federal rule and are not preempted.²

Covered entities can also claim narrower religious and conscience exemptions from specific provisions. The regulation does not override federal religious freedom and conscience protections, and where a provision would violate those protections, it does not apply. The ACA itself preserves federal conscience protections related to abortion, including an entity’s willingness or refusal to provide, pay for, or refer for abortion services. An entity seeking an exemption submits a written notification to the HHS Office for Civil Rights identifying the provision, the legal basis (such as the Religious Freedom Restoration Act, the Church Amendment, or the Weldon Amendment), and the factual conflict. A temporary exemption from investigation and enforcement takes effect on submission.⁴

What Compliance Requires Once You’re Covered

Falling within Section 1557 means more than avoiding overt discrimination. Covered entities face affirmative duties, and several of them scale with the size of the organization.

Designate a Section 1557 Coordinator

Any covered entity with 15 or more employees must designate at least one employee as a Section 1557 Coordinator. That person coordinates compliance across the entity’s health programs, receives and processes discrimination grievances, and maintains related records.⁵ The coordinator’s contact information must appear on the entity’s Notice of Nondiscrimination.

Post a Notice of Nondiscrimination

Covered entities must publish a Notice of Nondiscrimination stating that the entity prohibits discrimination based on race, color, national origin, sex, age, and disability. The notice must explain how to file a complaint with OCR, list the Section 1557 Coordinator’s contact information for entities with 15 or more employees, and describe available grievance procedures. It has to be posted on the entity’s website, displayed where patients seek services, and provided annually to participants and enrollees.¹

Provide Language Assistance and Post a Notice of Availability

Covered entities must offer qualified interpreters and translated materials free of charge and in a timely way to people with limited English proficiency. Patients cannot be billed for interpretation, and leaning on a family member or untrained staff does not satisfy the obligation when a qualified interpreter is needed.⁶

A separate notice of availability of language assistance services must be posted in English and in at least the 15 most commonly spoken non-English languages in the state where the entity operates. That notice appears on the entity’s website, in physical service locations, and in key communications such as application forms and eligibility notices, printed in no smaller than 20-point sans serif font.⁶

Ensure Effective Communication and Accessibility

Covered entities must provide appropriate auxiliary aids and services, including sign language interpreters, braille, and large-print materials, free of charge when needed for effective communication with people with disabilities. They must also make reasonable modifications to policies and procedures for equal access, except where doing so would impose an undue financial or administrative burden or fundamentally alter the program.⁷ These duties reach telehealth platforms and patient portals as well. A virtual visit system that cannot accommodate screen readers or captioning can put an otherwise compliant provider in violation.

Train Relevant Employees

Covered entities must train relevant employees on their Section 1557 policies and procedures. That group includes anyone who interacts with patients or the public, anyone who makes decisions affecting patient care (including executive leadership and legal counsel), and anyone who handles billing and financial obligations. New employees must be trained within a reasonable time after starting, and existing staff must be retrained after material policy changes. Training completion has to be documented, and those records kept for at least three calendar years.¹

Review Patient Care Decision Support Tools

As of March 2025, covered entities must make reasonable efforts to identify any clinical decision support tools in their health programs that use race, sex, age, disability, or other protected characteristics as inputs, and to take reasonable steps to mitigate the risk of discrimination when such tools are identified. The obligation covers automated tools like AI diagnostic systems and non-automated tools such as risk-scoring algorithms, along with tools used in prior authorization and medical necessity decisions.¹

If your organization takes HHS dollars in any form, runs an HHS-administered health program, or was created under Title I of the ACA, plan on Section 1557 applying to your entire health operation, not just the piece that touches the federal funding.

1
Federal Register. Nondiscrimination in Health Programs and Activities
2
Office of the Law Revision Counsel. 42 USC 18116 – Nondiscrimination
3
Department of Health and Human Services. Section 1557 Final Rule FAQs
4
eCFR. 45 CFR Part 92 – Nondiscrimination in Health Programs or Activities
5
eCFR. 45 CFR 92.7 – Designation and Responsibilities of a Section 1557 Coordinator
6
Department of Health and Human Services. Language Access Provisions of the Final Rule Implementing Section 1557 of the Affordable Care Act
7
Department of Health and Human Services. Section 1557 – Ensuring Effective Communication with and Accessibility for Individuals with Disabilities