Does Health Insurance Cover Transgender Health Care?

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Equal rights for transgender Americans have been a long time coming, but the Affordable Care Act (ACA) is making progress towards equality in health care. Section 1557 of the ACA prohibits discrimination on a wide variety of grounds for any "health program or activity" that receives any sort of federal financial assistance.

But that doesn't mean that all insured transgender people now have affordable access to whatever medical treatment they need.

Section 1557 of the ACA

ACA Section 1557 has been in effect since 2010, but it's only a couple paragraphs long and very general in nature. To clarify the nondiscrimination requirements, the Department of Health and Human Services (HHS) and the Office for Civil Rights (OCR) published a 362-page final rule for implementation of Section 1557 in May 2016.

Section 1557 prohibits discrimination based on existing guidelines—the Civil Rights Act, Title IX, the Age Act, and Section 504 of the Rehabilitation Act—that are already very familiar to most Americans (i.e., age, disability, race, color, national origin, and sex). Section 1557 of the ACA applies those same non-discrimination rules to health plans and activities that receive federal funding.

In the final rule, HHS and OCR clarify that gender identity "may be male, female, neither, or a combination of male and female." And the rule explicitly prohibits health plans and activities receiving federal funding from discrimination against individuals based on gender identity or sex stereotypes.

Section 1557 applies to any organization that provides health care services or health insurance (including organizations that have self-insured health plans for their employees) if they receive any sort of federal financial assistance for the health insurance or health activities.

That includes hospitals and other medical facilities, Medicaid, Medicare (with the exception of Medicare Part B), student health plans, Children's Health Insurance Program, and private insurers that receive federal funding (including subsidies in the exchanges for their individual market enrollees; in that case, all of the insurer's plans must be compliant with Section 1557, not just their individual exchange plans). Organizations that must comply with Section 1557 are referred to as "covered entities."

Most of the provisions of the final rule take effect on July 18, 2016, but if changes must be made to a health plan's benefit structure, those can be delayed until the start of the first plan year that begins on or after January 1, 2017. So a health plan that has a plan year that runs from August to July wouldn't have to implement the changes required in the final rule until August 2017.

OCR is tasked with enforcing Section 1557, and they've been doing so since 2010. Complaints and enforcement are handled on a case-by-case basis, and individuals are allowed to bring discrimination lawsuits in federal court under Section 1557.

Does the ACA Require Insurers to Cover Gender Reassignment Surgery?

Although the final rule for Section 1557 is very detailed and specifically prohibits discrimination based on gender identity, it does not require health insurance policies to "cover any particular procedure or treatment for transition-related care."

The rules also do not prevent a covered entity from "applying neutral standards that govern the circumstances in which it will offer coverage to all its enrollees in a nondiscriminatory manner." In other words, medical and surgical procedures must be offered in a non-discriminatory manner, but there's no specific requirement that insurers cover any specific transgender-related health care procedures, even when they're considered medically necessary.

OCR has explained that if a covered entity performs or pays for a particular procedure for some of its members, it cannot use gender identity or sex stereotyping to avoid providing that procedure to a transgender individual. So for example, if an insurer covers hysterectomies to prevent or treat cancer in cisgender women, it would have to use neutral, non-discriminatory criteria to determine whether it will cover hysterectomies to treat gender dysphoria.

And gender identity cannot be used to deny treatment that's medically necessary, regardless of whether it matches up with the individual's preferred gender. For example, a transgender male cannot be denied treatment for ovarian cancer based on the fact that he identifies as a male.

But the issue remains complicated. Prior to the guidance issued in the Section 1557 final rule, there were 17 states that specifically prevented health insurers from including blanket exclusions for transgender-specific care and 10 states that prevented such blanket exclusions in their Medicaid programs. Under the final rule, covered entities in every state are prohibited from using blanket exclusions to deny care for gender dysphoria and must utilize non-discriminatory methods when determining whether a procedure will be covered.

While Section 1557 is a big step towards equality in health care for transgender Americans, it does not require coverage for gender reassignment surgery and related medical care.

So Do Health Insurance Plans Cover Gender Reassignment?

Although Section 1557 has been in place since 2010, the final rule didn't come until six years later, and health insurers and providers are still working to sort out the details. Particularly given the fact that the final rule on Section 1557 does not require insurers to cover any particular procedures—even if deemed medically necessary—there is still plenty of gray area. provides information on how to report an enrollee's sex on an application for coverage in the health insurance exchanges in states that use, and explains how to go about reporting discrimination.

Since 2014, Medicare has covered medically necessary sex reassignment surgery, with coverage decisions made on a case-by-case basis depending on medical need. The Department of Veterans Affairs (VA) has also proposed eliminating its long-standing ban on paying for sex reassignment surgery for America's veterans.

And this brief from Aetna is a good example of how private health insurers might cover some aspects of the gender transition process, but not all.

As the final rule on Section 1557 is implemented, there will likely be more health plans opting to err on the side of covering sex reassignment surgery. Vanderbilt University announced in June 2016 that they would begin to cover gender transition surgeries on their student health plan, and the city of Portland, Maine will begin covering transgender-specific health care as of January 2017.

But also in June 2016, the board of the Public Library of Cincinnati voted unanimously to not add any riders to the library's current insurance plan. Riders under consideration included transgender health care, bariatric surgery, and infertility treatment. The library has coverage through Anthem, and the carrier offers an optional rider that the library could purchase to cover transgender health care.

But a library is not considered a covered entity under Section 1557 of the ACA, because their primary business is not the provision of health care, health insurance, or health-related services. As such, they are an example of an organization that may not have to comply with Section 1557's non-discrimination requirements in their employees' health insurance benefits.

A transgender male nurse who works for San Francisco-based Dignity Health sued his employer in June 2016 on discrimination grounds, because the hospital's health plan does not cover treatment for gender dysphoria. Virtually all hospitals are covered entities under Section 1557, but the hospital claims that its employee health plan is not discriminatory because it does not cover "personality disorders" in general (as opposed to being specifically discriminatory towards transgender employees).

The lawsuit argues that gender dysphoria isn't a personality disorder, but the case highlights the fact that Section 1557 still allows for somewhat subjective, case-by-case interpretation.

This issue is likely to face protracted legal debate over the next several years, particularly given the fact that the ACA's essential health benefits do not specifically include transgender health care and the fact that Section 1557's final rule doesn't explicitly require health plans to cover specific medical procedures related to gender reassignment, regardless of medical need.

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  1. DHS. Nondiscrimination in health programs and activities. Effective July 18, 2016.

  2. National Center for Transgender Equality. Know your rights: medicare.

  3. Health Affairs. LGBT protections in affordable care act section 1557. June 2016.

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