HHS Final Rule to Align Grants Regulation with Nondiscrimination

Today, the Department of Health and Human Services (HHS) issued a final rule that requires grantees to comply with applicable nondiscrimination statutes, including those protecting religious liberty. The final rule revises certain regulatory provisions in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards (“HHS grants regulation”) that were amended in 2016 to condition funding for grant recipients, including adoption and foster care service providers, in a way that burdened faith-based providers.

“The HHS grants regulation furthers the Department’s commitment to deregulation, protects the free exercise of religion, and relieves burdens on faith-based organizations seeking HHS support for their important work, especially as we seek to maximize opportunities for children to be adopted by loving families,” said HHS Chief of Staff Brian Harrison

In summary, this final rule:

  • Requires grantees to comply only with applicable nondiscrimination provisions passed by Congress and signed into law, instead of also requiring compliance with nonstatutory nondiscrimination provisions.
  • Provides that HHS complies with all applicable Supreme Court decisions in administering its grant programs, instead of extending two Supreme Court decisions to entities to which they may not be or are not applicable.
  • Removes the exclusion from allowable costs in grants of tax penalties due for failing to comply with the Individual Mandate of the Affordable Care Act (ACA), except for tax penalties associated with failure to maintain minimum essential coverage prior to January 1, 2019. The Trump Administration has already eliminated the penalty associated with failing to comply with the ACA’s individual mandate on and after that date.
  • Reissues the other provisions of the 2016 regulation without substantive changes.

In the final rule, HHS is revising two provisions of the 2016 regulation to require grantees to comply with applicable nondiscrimination provisions passed by Congress and signed into law, including legislation ensuring the protection of religious liberty, and to provide that HHS complies with all applicable Supreme Court decisions in administering its grant programs.

This rule represents the Trump Administration’s strong commitment to the rule of law―the Constitution, federal statutes, and Supreme Court decisions. These require that the federal government not infringe on religious freedom in its operation of HHS grant programs, and that it address the impact of regulatory actions on small entities.

The rule addresses the concerns of faith-based organizations and of foster and potential adoptive families and children impacted by the regulatory action taken by the previous administration that could have prevented faith-based organizations from participating in HHS grant programs – or forced faith-based organizations out of HHS grant programs.

HHS is committed to the principle that every person must be treated with dignity and respect and afforded all of the protections of the Constitution and statutes enacted by Congress – and to fully enforcing such civil rights protections and requirements. The previous administration issued nonstatutory nondiscrimination requirements that would have also violated the Religious Freedom Restoration Act (RFRA) in some circumstances, as evidenced by multiple accommodation requests and lawsuits. Since HHS was under no obligation to adopt such provisions, it now repeals them to avoid the RFRA issues associated with such requirements.

The final rule better aligns HHS grants regulations with the Constitution and federal statutes, and eliminates regulatory burden, including burden on the free exercise of religion. HHS also affirms that it will comply with all applicable Supreme Court decisions in administering its grants programs.

Read the final rule.*

* This content is in the process of Section 508 review. If you need immediate assistance accessing this content, please submit a request to digital@hhs.gov

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