State health plans must include transgender coverage, rules appeals court

In a decision that could have far-reaching implications, a federal judge on Monday ruled that state health-care plans and government-funded insurance programs cannot exclude coverage for gender-affirming medical care.

The 4th U.S. Circuit Court of Appeals affirmed two lower-court rulings ordering North Carolina and West Virginia to end policies that exclude coverage for gender-affirming care. North Carolina’s state health plan does not cover treatment “in connection with sex changes or modifications and related care,” and West Virginia’s Medicaid program covers only some gender-affirming treatments.

“The coverage exclusions facially discriminate on the basis of sex and gender identity, and are not substantially related to an important government interest,” Judge Roger Gregory wrote in the majority opinion. Attorneys for both states had argued that the policies were based only on cost concerns, not animus toward transgender people.

In 2022, a federal judge ruled that North Carolina’s health plan discriminates by excluding coverage for gender-affirming medical care. Later that year, another court ruled that West Virginia’s Medicaid program must provide coverage for transgender care. Tara Borelli, senior legal counsel at Lambda Legal and lead attorney on both cases, praised Monday’s ruling.

“It confirms that discriminating against transgender people by denying critical medical care is not only wrong but unconstitutional,” she said. “No one should be denied essential health care, but our clients in both cases were denied coverage for medically necessary care prescribed by their doctors just because they’re transgender.”

Patrick Morrisey, West Virginia’s attorney general and Republican gubernatorial candidate, said the state will appeal the ruling. “Decisions like this one, from a court dominated by Obama- and Biden-appointees, cannot stand,” he said. “We’ll take this up to the Supreme Court and win.”

Major medical associations consider gender-affirming care for minors and adults to be medically necessary. However, since 2021, 24 states have banned treatments for transgender youths, according to the nonprofit Movement Advancement Project. In more than a dozen states, gender-affirming care explicitly is excluded from state employee benefit plans, and Medicaid policies in 10 states exclude coverage for transition-related care for individuals of all ages. In three states, Medicaid can be used to cover the cost of gender-affirming care for transgender adults but not minors.

Related: An employer’s guide to gender-affirming care: A multi-layered approach to coverage is key

Similar cases are under consideration in courts across the country, but Monday was the first U.S. Court of Appeals decision to consider government-sponsored coverage exclusions of gender-affirming medical care and whether those exclusions are lawful.