Tennessee v. Kennedy, 2025 WL 2982069 (S.D. Miss. 2025)
A federal trial court has vacated certain provisions of the regulations under Affordable Care Act Section 1557 to the extent they expand Title IX’s definition of sex discrimination to include gender-identity discrimination. As background, Section 1557 prohibits discrimination in certain health programs and activities on the basis of race, color, national origin, sex, age, or disability. HHS issued regulations in May 2024 that relied on evolving Title IX rules, incorporated by reference into Section 1557, to provide that “discrimination on the basis of sex” specifically includes discrimination based on sexual orientation, gender identity, sex characteristics, pregnancy, and sex stereotypes. In this lawsuit, 15 states asked the court to invalidate the provisions related to gender identity. Before the regulations’ scheduled effective date, the court issued a nationwide injunction and stay on the gender-identity discrimination provisions, ruling that there was a substantial likelihood that HHS exceeded its statutory authority when it applied the Bostock holding regarding Title VII to interpret the phrase “on the basis of sex” in Title IX. In Bostock, the U.S. Supreme Court used the traditional “but-for” causation standard to determine that firing employees based on sexual orientation or gender identity constitutes illegal discrimination on the basis of sex.
The court has now ruled that the gender-identity discrimination provisions of the Section 1557 regulations exceeded HHS’s statutory authority. The court explained that the challenged provisions required providers to offer gender-affirming care (such as mastectomies for gender dysphoria) if they would provide similar care for other diagnoses (such as breast cancer). The court then relied on the U.S. Supreme Court’s Skrmetti decision to distinguish Bostock. Pointing out that in the present case, as in Skrmetti, an individual’s medical diagnosis (rather than their sex) is the but-for cause of the health care denial, the court concluded that the refusal to provide gender-affirming care is not sex discrimination, even under Bostock’s analysis. Accordingly, the court universally vacated the portions of the regulations that interpreted Section 1557 as prohibiting discrimination based on gender identity.
EBIA Comment: Focusing on the legal and historical distinctions between Title VII and Title IX, this case limits the scope of Section 1557’s protections. Although the gender-identity discrimination provisions had already been blocked from enforcement, this decision officially vacates the rules. For more information, see EBIA’s Health Care Reform manual at Section XXXIV.A (“Section 1557 Nondiscrimination: Grounds Prohibited Under Federal Laws”) and EBIA’s Group Health Plan Mandates manual at Section XXI.M.1 (“Interaction of Title VII and Affordable Care Act Section 1557”). See also EBIA’s Self-Insured Health Plans manual at Section XIII.D.5 (“Section 1557 Nondiscrimination: Nondiscrimination in Health Programs and Activities”).
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