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The Obama administration is set to re-examine the ban that prohibits Medicare from covering gender reassignment surgery, according to a memorandum obtained Tuesday by the Washington Blade.

The document from the Department of Health & Human Services, dated Dec. 2, finds that the reasoning for the ban is “not complete and adequate” to support denying Medicare coverage for transgender people seeking the procedure.

The HHS Department Appeals Board states the ban — which is codified as National Coverage Determination 140.3 — “fails to account for development in the care and treatment” for transgender people over the course of the last 30 years.

The next step, the memo states, is proceeding into a “discovery” phase for the taking of evidence to determine whether the ban can be justified.

Mara Keisling, executive director of the National Center for Transgender Equality, said “there really isn’t that much to say” at this point in the process.

“This is really a preliminary step,” Keisling said. “It’s a good sign, but we have more to go on this.”

Masen Davis, executive director of the Transgender Law Center, was optimistic the ban would be lifted following the discovery process.

“Current Medicare standards are based on science from the 1960s, so it’s about time for a review,” Davis said. “Because the current scientific evidence overwhelmingly shows that sex-reassignment surgeries are effective and medically necessary treatments for some transgender individuals, we are hopeful the board will find the exclusion is not supported.”

The DAB initiated the review of the ban on Medicare-provided gender reassignment surgery in response to a request filed in March by a quartet of LGBT advocates: the National Center for Lesbian Rights, the American Civil Liberties Union, Gay & Lesbian Advocates & Defenders and civil rights attorney Mary Lou Boelcke.

The challenge was filed on behalf of Denee Mallon, a 73-year-old transgender woman in Albuquerque, N.M. A Medicare recipient, Mallon was recommended to have gender reassignment surgery by doctors to treat her gender dysphoria

In a joint statement provided to the Washington Blade in response to the HHS memorandum, the ACLU, NCLR and GLAD expressed optimism that DAB would come to the conclusion after discovery that the ban on Medicare-provided gender reassignment surgery should be lifted.

“Because the current evidence overwhelmingly shows that sex-reassignment surgeries are effective and medically necessary treatments for some individuals with gender dysphoria, we are hopeful the Board will find the exclusion is not supported,” the statement says.

According to the memorandum, the ban was put in place in 1989 as a result of a 1981 report from the National Center for Health Care Technology, an arm of HHS. The report concluded “transsexual surgery not be covered by Medicare at this time” because of the high rate of complications and questions about whether it was effective in treating gender identity disorder.

“Transsexual surgery for sex reassignment of transsexuals is controversial,” the regulation states. “Because of the lack of well controlled, long term studies of the safety and effectiveness of the surgical procedures and attendant therapies for transsexualism, the treatment is considered experimental. Moreover, there is a high rate of serious complications for these surgical procedures. For these reasons, transsexual surgery is not covered.”

Despite the institution of this policy, the American Medical Association and the American Psychological Association support gender reassignment surgery for transgender people as a means to treat gender identity disorder.

Notably, the Centers for Medicare & Medicaid didn’t put up a fight in response to the request from LGBT advocates to lift the ban. According to the memo, CMS notified the board in June that it wouldn’t submit a response to their request to lift the ban.

Neither HHS nor CMS responded to the Blade’s request for comment on the determination or why it declined to defend the ban.

It’s unclear when the discovery period for reevaluating the ban on Medicare-provided gender reassignment surgery will come to an end. Shawn Jain, a spokesperson f0r the ACLU, said his organization doesn’t know when the process will be complete.