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New Obama administration regulations would require insurers to cover gender-affirming treatments for transgender people — for the first time ever.
Civil rights laws already bar health plans from discriminating based on race, color, national origin, disability, or age. This new rule would add sex discrimination to that list, including discrimination based on gender identity. And that, Health and Human Services says, will require insurance plans to cover treatments that help enrollees medically transition.
It's hard to know how many health insurance plans cover gender-affirmation services right now. What is clear, however, is that the coverage is not uniform — one 2013 paper from the Center for American Progress cited multiple instances in which insurance plans specifically excluded coverage for treatments "related to sexual assignment" or "sex transformations."
The Obama administration's fact sheet on the new provision says that "those categorical exclusions are prohibited under the proposed rule." This does not necessarily translate into blanket coverage for all services related to gender affirmation. Health insurers will often only cover a certain type of treatment for a given condition and refuse to cover others. This happens a lot, like when insurers won't cover a brand-name drug if there's a generic, or require patients to see a primary care doctor before allowing coverage for a specialist. It's easy to see insurers using those same type of restrictions with gender-affirming treatments, too.
Still, advocates say this will be a big step forward: It will disallow the blanket bans on covering gender-affirmation services that, to this day, show up in numerous health plans.
No, this won't make health insurance costs skyrocket
Surgery for gender affirmation can be expensive; the Human Rights Campaign, an LBGTQ advocacy group, estimates that trans-specific treatments can cost between $25,000 and $75,000. But that's also in the ballpark of what we pay for other procedures, like a hip replacement or heart bypass surgery. What's more, previous evidence shows that other, more local mandates to cover transgender surgery costs have not resulted in higher premiums. German Lopez wrote about it here:
When San Francisco began to offer trans-inclusive health coverage to its employees in 2001, the city applied a small surcharge to all employees enrolled in its health plan. But the city ended up using just $386,000 of the $5.6 million raised by the policy — a cost so low that it eventually dropped the additional charge altogether.
"[D]espite actuarial fears of over-utilization and a potentially expensive benefit," San Francisco's Human Rights Commission noted, "the Transgender Health Benefit Program has proven to be appropriately accessed and undeniably more affordable than other, often routinely covered, procedures."
The Obama administration's new rule isn't final yet — it is currently open for comment, and after that the federal government will need to create a final version that incorporates any feedback received. That could possibly happen as soon as 2016, making discrimination against transgender patients a thing of the past.
Correction: an earlier version of this headline said that health insurers would be required to cover transgender surgeries. The regulation does require insurers to cover services related to gender transitions but does not specify which services, exactly, will fall under that umbrella.
