South Carolina health officials announced Friday that they will cover a local construction worker's breast cancer treatment under Medicaid even though federal guidelines exclude him because he is a man.

The decision effectively dares the federal Medicaid office to reject the claims for his treatment, and it sets up a potential showdown between state and federal officials.

But until then, South Carolina said it will cover Raymond Johnson -- a 26-year-old man who discovered he had breast cancer last month. His unsuccessful efforts to apply for Medicaid coverage have drawn national attention.

Tony Keck, director of the South Carolina Department Health and Human Services, said it is "in the best interest" that Johnson be deemed eligible for the program.

"The department will submit claims to the federal government for reimbursement of his treatment, as we do with all other eligible beneficiaries. If federal lawyers choose to deny those claims based on a discriminatory policy, that is their choice and our department will appeal the decision," Keck said in a statement. "We will continue to work with our federal counterparts on this issue, but will not deny coverage to Mr. Johnson or any other South Carolinian in this particular situation."

A spokesman with The Centers for Medicare & Medicaid Services earlier told FoxNews.com that the federal agency was weighing its options to see if there was any remedy for the dispute.

But South Carolina health department spokesman Jeff Stensland said the agency has so far not changed its policy. "They told us after consulting with their lawyers we couldn't cover him. We are covering him regardless; we will see if the feds deny the claims," he said in an email to FoxNews.com Friday.

CMS has argued in the past that it would take an act of Congress to allow men to be covered for breast cancer visits. The problem has to do with a discrepancy between two laws.

In a 2009 letter in response to a prior attempt by South Carolina to cover a male patient, the agency said a 2000 law creating Medicaid coverage for breast cancer patients did not explicitly exclude men. That law, however, provided coverage only to those screened under a program which, according to a separate law, is meant for women.

Because of those guidelines, South Carolina initially denied coverage to Johnson.

Meanwhile, Johnson is continuing to seek treatment, as well as the money to pay for it. He said earlier this month that churches and other organizations have helped pay the bills so far and that he's still trying to get insurance coverage.

He said the government's policy is "really dumb."

"It's not as common as a woman having breast cancer, but we do have it," Johnson said.

Though breast cancer afflicts women the most, men are susceptible to it because they also have breast tissue that can develop cancer. According to the American Cancer Society, more than 2,100 cases of invasive breast cancer in men are expected to be diagnosed in 2011.