AILSA CHANG, HOST:

The Trump administration is rolling back some anti-discrimination rules tied to health and human services spending. That means a nonprofit group like an adoption agency or a health clinic that receives an HHS grant could refuse a client based on sexual orientation, gender or religion. Here to explain all of this is NPR health policy reporter Selena Simmons-Duffin.

Hey, Selena.

SELENA SIMMONS-DUFFIN, BYLINE: Hi.

CHANG: So what exactly is this change that's been announced?

SIMMONS-DUFFIN: So this change affects organizations and nonprofit agencies that get federal grants from Health and Human Services. And there are rules that if you take these dollars, you can't discriminate as far as who your clients or patients are. You can't say, hey, I'm running this walk-in clinic but not for you because you're too old, or you're disabled, or you're a certain race.

CHANG: OK.

SIMMONS-DUFFIN: Under Obama, these health grants added new protected categories - religion, sexual orientation and gender identity. So what's new now is that HHS officials are rolling back protections for those last three categories. So if you go back to that walk-in clinic example, that means theoretically, they could say, we don't serve Muslim patients in this clinic or transgender patients. That's a hypothetical, and the impact of this could vary depending on where you live.

CHANG: So how much money are we talking about here?

SIMMONS-DUFFIN: So much money, Ailsa. Health and Human Services gives out more federal grant money than any other federal agency.

CHANG: Oh, wow.

SIMMONS-DUFFIN: We're talking of billions and billions and billions of dollars a year flowing to everything from HIV services to Head Start programs, refugee assistance, medical research. But a big impact of this rule change is on child welfare services. So a city or state might contract out the placement of kids in foster care to a faith-based group like, say, a Catholic group. In the past, as long as it received HHS funding, it had to place kids with anyone who was qualified who applied to be parents - so Jewish parents, same-sex couples, whoever. Now, that Catholic group can continue to receive HHS grant funding, and it can choose to deny services to people who are not, for instance, straight and Catholic.

CHANG: OK. All of this sort of reminds me of some other changes the Trump administration has made, saying they're only doing that to uphold religious freedom. Was this development expected?

SIMMONS-DUFFIN: Basically, yes. There's a nonprofit in South Carolina called Miracle Hill Ministries that provides homeless and fostering services. And back in January, this group got a special waiver from HHS to keep getting federal grant funding even though they only work with Protestant prospective parents. So they told a woman, for instance, that she couldn't become part of their mentoring or fostering programs because she's Jewish.

So this new rule extends that special permission out. It's really far-reaching. The administration used a faster process for this with less time for the public to weigh in than normally happens with changing agency policy.

I should also say that the child welfare groups that I talked to today think this is a very bad thing not just for prospective adoptive or foster parents, but also for children. So one scenario I heard today is that if a gay or transgender kid is set up with a faith-based agency, they might have to go through conversion therapy to be placed with a family, or they might not be eligible to be placed with a family at all. And that's not a hypothetical - that was happening before these Obama-era protections were put in place.

CHANG: So what's the Trump administration's explanation for why they're making this change?

SIMMONS-DUFFIN: The administration is framing this as giving more religious freedom to organizations. And conservative groups like the Family Research Council and the Cato Institute really cheered this move enthusiastically. Their argument is that faith-based groups were being shut out from this big pool of federal funding if they refused to comply with those nondiscrimination rules and that this will allow for more agencies to be able to operate in a way that aligns with their moral and religious values.

One thing I should point out - faith-based groups have been receiving HHS grants. They're a huge part of providers of child welfare services, and many of them do not discriminate. The change is that now those that do want to only provide services to some people of certain faiths, certain sexual orientations, can now limit their services in that way and still receive taxpayer dollars through these grants.

CHANG: That's NPR's Selena Simmons-Duffin.

Thanks, Selena.

SIMMONS-DUFFIN: Thank you. Transcript provided by NPR, Copyright NPR.