The Medicare decision barely made a ripple. | John Shinkle/POLITICO Transgender surgery coverage grows

Medicare’s recent decision to cover sex-reassignment surgery was a victory for transgender advocates seeking broader access to medical care for a condition that still carries social stigma. After all, the federal health program was one of the first to exclude such treatments more than 30 years ago.

Yet a series of announcements since then shows the extent of advocates’ push to get insurance providers to share the cost of matching a patient’s outward gender and inner identity. Since the Medicare decision in May, officials have opened the door to coverage by health plans for federal employees as well as required it for many plans in Massachusetts and Washington state. About a half-dozen mostly liberal states had already expanded coverage.


Advocates welcome the latest shifts but don’t expect a sudden domino effect nationwide. As they press for broader public acceptance, they still have to contend with what one activist called the “ick factor” in discussing sex organs with insurance regulators, private companies and federal agencies.

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Even the imprimatur of Medicare is unlikely to change that overnight.

“Sometimes inevitability takes awhile,” said Mara Keisling, executive director of the National Center for Transgender Equality. She added wryly, “Marriage equality is still illegal in a handful of states, and the Washington football team is still called the Redskins.”

One new element: In recent regulations requiring surgery coverage, both Washington state and Massachusetts cited provisions in the Affordable Care Act barring discrimination related to gender identity. The Department of Health and Human Services does not interpret the health care law so broadly regarding sex-reassignment surgery.

With coverage still very inconsistent and change still incremental, the efforts haven’t sparked a backlash from social conservatives. The Medicare decision barely made a ripple.

And there is now a broad medical consensus affirming gender dysphoria — the diagnosis for people whose bodies do not match their self-perceived gender — as a serious condition that might require hormones, psychotherapy or surgery. The American Medical Association’s position, adopted in 2008, is that insurance companies should cover such treatment when recommended by a patient’s physician.

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The treatment can be expensive, with full-body, transformational surgical procedures sometimes topping $70,000. But studies from UCLA and California’s Department of Insurance show that the overall cost to public or private employers is relatively small because so few people undergo the most extensive treatments.

In late 2012, Oregon was the first state to direct private insurers to pay for transition procedures deemed medically necessary. California, Vermont, Colorado, Connecticut and Washington, D.C., have done the same, and major cities such as San Francisco and Rochester, N.Y., cover their employees.

However, many of those decisions have limited scope. In Washington state, Insurance Commissioner Mike Kreidler cited antidiscrimination clauses in both the ACA and state law when he told insurers this spring that “transgender people are entitled to the same access to health care as everyone else.” But his notice does not apply to plans for state employees, self-insured companies or, crucially, Medicaid.

“What’s so challenging, I think, is that it’s a politically unpopular issue,” said M. Dru Levasseur, director of Lambda Legal’s Transgender Rights Project. “There’s ignorance around transgender people in general and transgender health care specifically.”

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To a large degree, the coordinated coverage push has been built on the gains in the courts and the corporate world — not unlike the way that gays’ and lesbians’ push for marriage equality initially moved forward.

At least nine federal appeals courts have recognized gender dysphoria as a serious condition. Most of those cases involved prisoners seeking treatment while incarcerated, who alleged that denial amounted to cruel and unusual punishment.

Employers have also been at the vanguard, as they were when they extended domestic-partner benefits long before gay marriage became possible. At least 167 of the Fortune 1000 companies offer surgical benefits, according to the Human Rights Campaign’s Corporate Equality Index.

Still, Medicare’s announcement this spring was both a practical and symbolic shift. In 1981, the program had declared sex-change surgery “experimental,” denying coverage. Change took decades and an appeal by a 74-year-old Army veteran and transgender woman named Denee Mallon. In December, an HHS review board ruled that the rationale was outdated.

Advocates do not expect an immediate response from other federal providers. In fact, they say they’re not even going to try for coverage through the Defense Department’s TRICARE program and the Veterans Health Administration until they win a more fundamental battle: the right for transgender people to serve openly in the military.

The decisions on health plans are rarely comprehensive. The Office of Personnel Management, for example, is allowing but not requiring insurers to add coverage through their Federal Employee Health Benefit plans. Patchwork state systems mean regulators’ decisions may apply to a limited number of plans. Only three states and the District of Columbia have added the range of gender dysphoria treatments to Medicaid benefits.

Even for plans that offer coverage, the line between procedures that are “medically necessary” versus cosmetic can blur.

National groups, including the Center for American Progress and the American Civil Liberties Union, are teaming with regional activists on the issue. Transgender individuals are not asking for unique treatment, they say. They simply want insurance companies to pay for procedures deemed medically necessary for other adults. A man becoming a woman should have access to the same hormone therapies as a menopausal woman, advocates maintain. Or a woman becoming a man should have access to the same reconstructive surgery as a man severely wounded below the waist in a car accident.

Moreover, advocates contend that any costs are cheaper than leaving gender dysphoria untreated. A majority of respondents to the 2011 National Transgender Discrimination Survey said they had been refused medical treatment by a provider because of transgender bias — and 60 percent of respondents reported attempting suicide.

Armed with the research, advocates are pressing forward. Discussions are underway with regulators in Rhode Island and New York, and in late June, they filed a federal lawsuit seeking coverage from the Empire State’s Medicaid program. The negotiations tend to involve uncomfortable conversations with policymakers about what, exactly, a gender dysphoria diagnosis means and the medical rationale for treating it.

“It’s really intense and icky for people, including policymakers, to think about people changing their genitals,” acknowledged Danielle Askini, a founder of the Gender Justice League in Washington state.

Askini was also involved with the successful coverage effort in Oregon, and she credits its transgender community with becoming more visible and sharing personal stories through the YouTube video “ Faces of Trans Inclusive Health Care.”

Insurance companies say they are committed to nondiscrimination and ready to offer plans covering surgery when payers request it or regulators require it. Even when a policy includes coverage, however, issues arise over what’s elective versus essential.

In their coverage descriptions, major insurers like Aetna and UnitedHealthcare will pay for changes to private body parts, like vaginoplasty and testicular prosthesis. Mastectomies for female-to-male patients and breast implants for male-to-female patients are usually covered, too. Procedures such as facial feminization or voice modification surgery are generally excluded as cosmetic.

“It’s important that a person undergoing gender-confirming surgery is brought into the wide range of appearance variation for people of the desired gender,” said Patrick Johnston, head of the California Association of Health Plans. But, he continued, “it remains important in controlling health care costs to continue the distinction between medically necessary services and services designed to improve appearance generally, no matter who the person is.”

Other, more fundamental health care barriers remain. In Illinois, for example, Lambda Legal is representing a woman who alleges that her doctor refused to provide any care because of her gender identity. And transgender people are four times more likely to live in poverty than the general population, according to the National Transgender Discrimination Survey. Advocates say ongoing employment discrimination and social ostracism drive that statistic.

Perhaps the surest sign of the “inevitability” Keisling foresees comes from the insurance companies themselves. Four of the five largest insurers cover all medically necessary treatments for their own transgender employees. And independent of regulators, a spokesman said Aetna is at least one company expecting to add coverage for gender reassignment surgery to some private plans in the future.