Insurance plans issued in the United States since the 1980s routinely contained broadly written exclusions prohibiting payment for care related to "transsexualism," "sex change treatments," "gender identity disorders," or "transgender care." In some cases providers or clinic administrators, as well as claims administrators within insurance companies, would interpret these exclusionary statements in the broadest possible terms, assuming that transgender people could not receive medical care. The burden of fighting against this level of adversity when people are physically ill or injured represents a significant barrier to care. This adversity has contributed to the high incidence of transgender people avoiding seeking needed health care.
Complexities of insurance and health benefits plans
Insurance policies are regulated by each of the 50 U.S. states; therefore, for example, an Anthem Blue Cross policy issued in one state may be very different in content from a policy issued by the same carrier in another state, though the plans may appear at first to be equivalent. Further, many people with private insurance in the U.S. receive coverage through their employer, and many large employers are able to negotiate their coverage to include or exclude specific care. These are "health benefits plans" and are not "insurance plans" strictly speaking, although they may appear the same to the enrolled member. Often referred to as "ERISA plans," (in some cases referred to as "self-insured" plans) such health benefits plans are usually regulated under the federal Employee Retirement Income Security Act of 1974), These ERISA plans are issued and administered by the same insurance companies that offer individual or small group plans, but the employer pays the direct costs of all care. As such ERISA plans have greater flexibility in what is covered, depending on the mission and intentions of the employer. In non-ERISA plans (in some cases referred to as a "fully funded" plan), the insurance company assumes the risk that the individual or group will not cost them more than the premium and co-pays will bring in. Being further removed from an incentive (i.e. covered employee recruitment and retention), non-ERISA plans may be less nimble in adding coverages or responding to case-by-case scenarios.
Although plans insured by or administered by a given carrier (e.g., Aetna, United Health, Anthem BCBS, et cetera) are often very different from each other, there are also often similarities in approach as carriers strive to standardize internal processes. Most carriers have now issued their own internal guidelines specific to transgender-related healthcare, especially surgical interventions. These guidelines (called by various names such as medical policies or coverage positions) spell out what services will be covered for a specific medical condition and usually apply to all insurance products issued by a carrier. However, they may not apply to some ERISA-regulated health benefits plans since large employers have the ability to negotiate medical guidelines specific to their own employee health plans.
Thus, what is covered by a given health plan will vary not only by state but also by employer. Some large companies choose to offer transgender health benefits under their ERISA plan in order, for example, to maximize their talent recruitment, to provide a just and equitable workplace, or to control healthcare costs by providing the services people need. These large employers have chosen to implement medical guidelines that offer increased access, such as coverage of a greater range of medically necessary services. Smaller businesses, which depend on the insurance company to assume the risk (and whose risk is combined with other small employers), may not have the leverage to negotiate inclusion of transgender health benefits. However, smaller employers can inquire with their carrier representative as to feasibility and per-member, per-month costs of doing so, since coverage is becoming increasingly common across the country.
Gaining coverage: changing the paradigm
From the 1960s through the 1990s, some very persistent Individuals, often with support from their health care providers, were able to secure benefits payments, in certain instances. However, systemic reform did not begin until the 2000s, after advocates were able to convince the City and County of San Francisco to eliminate exclusions in at least one of the five plans City and County employees could select from for their health care coverage. Utilization data from the first five years showed that there was little or no increase in plan cost when medically necessary gender affirming care was included in a large group plan. These results were used to inform the inclusion of transgender health benefits in the Human Rights Campaign's Corporate Equality Index, an instrument devised to grade companies on their approach to LGBT employee and customer relations.
Private and public insurance reform
As of 2015, an increasing number of employers are offering transgender-inclusive health benefits plans, and insurance Commissioners in numerous states and the District of Columbia have issued regulations prohibiting the sale of insurance plans that discriminate against transgender people. Further, on May 30, 2014, the U.S. Department of Health and Human Services issued a ruling that Medicare's longstanding exclusion of "transsexual surgical procedures" was no longer valid, leaving the provision of services up to local coverage determinations. Following suit, some states have begun to revise their Medicaid plans to offer transgender-inclusive health care. Specific Medicaid policies can be obtained from individual state Medicaid regulatory agencies. Currently (as of 2015) the Center for Medicare and Medicaid Services (CMS) is in the process of developing a new National Coverage Determination with regards to inclusion of gender affirming care in the Medicare program. Private health insurance products are often regulated by the State Department of Insurance or Department of Managed Care (department nomenclature may differ by state); specific policies and coverage details can be obtained from individual state agencies.
Claim denials for sex-specific procedures
In some automated systems, if for example the patient is designated as "female" in the electronic record (EMR), and a treatment or procedure code is entered for care that is exclusively covered for bodies designated male [e.g., prostatic ultrasound]), that claim may be automatically rejected. The reverse would be true for someone designated as "male" in the EMR but who requires care that is exclusively covered for bodies designated "female." If the patient's plan document or individual state regulations provide that transgender care is covered (or that care may not be restricted on the basis of sex), then the patient may need support from the physician's office to inform the carrier or administrator that the patient is transgender, and that this claim cannot be rejected. If there is no provision for transgender care in this instance, it will be necessary for the provider to appeal to the carrier for coverage of the specific treatment or diagnosis.
Overriding a "sex mismatch": condition code 45
All federally-funded health institutions (e.g., most hospitals) have received instruction on the use of Code 45 (and the KX modifier) in their coding practices and all Medicare Administrative Contractors are required to process this code, which is an override for a sex mismatch. However, the code may not have been implemented by all hospitals or carriers' systems; in these cases using Code 45 may result in a returned claim for correction, or outright denial of the claim.
The Office for Civil Rights of the U.S. Department of Health and Human Services (HHS) has already issued guidance that preventive services may not be denied simply on the basis of sex, resulting for example in CDC coverage of mammograms for transgender women. In May 2015, CMS issued sub-regulatory guidance clarifying that preventive services are available under the Affordable Care Act (ACA) regardless of an individual's gender identity, sex assigned at birth, or recorded gender. Section 2713 of the Public Health Service Act, as amended by the ACA, requires most health plans to cover certain preventive services, regardless of gender.[7,8] Over time resolution of other sex-gender "mismatch" problems is expected to evolve as a result of new regulations guiding the implementation of non-discrimination provisions based on sex, contained in Section 1557 of the Affordable Care Act (forthcoming from the U.S. Department of Health and Human Services, HHS). In the meantime, those who experience denials on the basis of sex-gender mismatches for sex-specific services are encouraged to file complaints with HHS Office for Civil Rights.
Claims denials and discrimination
Many transgender people experience denials of their claims for transgender transition-specific services. Many more never receive a formal denial because their plan contains transgender-specific exclusions and the physician never files paperwork for prior authorization for such services. Many call their insurance carrier and are told services will not be covered, and on that basis never attempt to file a claim. Transgender individuals and their health providers should be aware that unless a denial is in writing, it is not a denial and cannot be appealed. More importantly, transgender individuals with well-documented claims are increasingly achieving success in their appeals. Individuals are encouraged to work proactively with their medical providers to ensure that appeals documents include individualized, extensive documentation of the necessity and appropriateness of services. Such appeals should also include a comprehensive and detailed overview of the process of gender transition, including the role of and evidence in support of the specific services requested. In addition to providing a background to uninformed reviewers, such comprehensive documentation conveys the individual's intent to pursue the appeals to the final stages, which can be quite persuasive.
Over time resolution of these problems is expected to evolve as a result of new regulations guiding the implementation of non-discrimination provisions based on sex, which will be issued by HHS in the coming months. In the meantime, individuals whose health plans contain provisions which discriminate on the basis of sex, including transgender-specific exclusions, are encouraged to file complaints with the HHS Office for Civil Rights. While not every health plan in the U.S. is currently regulated under Section 1557 of the ACA, the ACA does specify that the Essential Health Benefits they are required to provide must also not discriminate on the basis of sex.
|Coverage Type||General Characteristics and Caveats|
|ACA/Exchange Plans||Affordable Care Act coverage for individuals and families who are not eligible for Medicaid or Medicare, and who do not have insurance coverage through their employer, or may be self-employed. Until HHS implements Section 1557, only states with laws forbidding discrimination against transgender people in insurance products are likely to have transgender-inclusive plans available. To see if your state is one of these, check for the latest information on health coverage at the National Center for Trans Equality  or the Transgender Law Center websites. However, even in several states currently prohibiting transgender exclusions in insurance plans, some or all marketplace plans may still retain exclusions.|
|Employer Plans, Fully-Funded (ERISA)||These are group plans available to small businesses, and sometimes may include plans offered to qualified individuals. Fully-funded means that purchaser of the plan pays a premium to fund the cost of services provided by medical providers and by the insurance company. Insurance companies often aggregate these plans to reduce their risk by pooling similar customers; if a small employer could find out who else was in their "pool," they might be able to convince the other companies to also ask for a policy change to make their plan transgender-inclusive. However, aggregate group composition is not public information, allowing insurers to control variables to maintain profit margins. These plans are subject to state regulation, so their terms may vary by state. To see if your state is one of these, check for the latest information on health coverage at the National Center for Trans Equality or the Transgender Law Center websites.|
|Employer Plans, Self-Insured (non-ERISA)||These are group plans that are administered by insurance companies, using the same kind of provider networks and claim processing mechanisms as their other plans, but the employer pays ALL the costs themselves, and thus the employer bears all the risk. These plans are exempt from state regulation by the federal ERISA regulations, which give the employer/customers of the plans much more leeway to request the features and coverage levels that they want, including transgender-specific care. Some of these plans have their own internal medical guidelines that provide for coverage of all services medically necessary for transition.|
|Health Maintenance Organizations (HMO)||These state-regulated organizations provide both the insurance coverage and the medical services that they cover. In some cases, available services may not include transgender-specific care, but many HMOs are working hard to provide competent trans-sensitive care. As of December 2015, thirteen states including the District of Columbia have prohibitions on transgender exclusions (note a prohibition on exclusions is not the same as mandated inclusion) in these health plans, with implementation varying by state. Individual state information is available at National Center for Trans Equality or Transgender Law Center.|
|Medicaid||These are state-run (partially funded by federal money) safety net programs that provides payment to providers who will accept the amount the program is willing to pay (usually much less than private insurance will pay). Medicaid provides coverage for qualified low-income people, families and children, pregnant women, the elderly, and people with disabilities. Some states are starting to remove exclusions for trans-specific care from their Medicaid plans. To see if your state is one of these, check for the latest information on health coverage at the National Center for Trans Equality or the Transgender Law Center websites.|
|Medicare||This is the federal program that covers people over 65 years old, and disabled people under age 65. HHS ruled in May 2014 that blanket exclusions for "transsexual surgery" are no longer appropriate because the medical evidence exists to show that such care, when delivered appropriately, is effective, and it is no longer experimental surgery, nor is it "simply cosmetic." Currently coverage is available through Local Coverage Determination on a case-by-case basis.|
|Railroad Medicare||Under this program, people who worked for railroads for at least 10 years may access Medicare Part B services at favorable rates through the railroad-specified administrator. Transgender-specific services may be available according to Local Coverage Determinations (LCDs) through the Center for Medicare and Medicaid Serves (CMS).|
|TRICARE||This is the health benefit administration program for U.S. active duty military service members and their dependents and retirees who are not eligible for Medicare. Transgender-specific services are not available while transgender people are not permitted to serve openly in the military. This policy may change in mid-2016.|
|Union Plans||Some labor unions, in some states, may have transgender-inclusive policies available; check with the union's benefits office/department. Several labor unions have resolutions at the national level calling for the elimination of transgender exclusions. Although not binding on member unions, these may help union members fight for benefits equity.|
|Veteran's Administration||Transgender Veterans may obtain regular medical care, including hormone therapy. Transgender-specific surgical procedures are currently restricted or prohibited, although this may change as the U.S. military considers the role of transgender service members.|
- Grant JM, Mottet LA, Tanis J, Harrison J, Herman J, Keisling M. Injustice at every turn: a report of the National Transgender Discrimination Survey. National Center for Transgender Equality and National Gay and Lesbian Task Force; 2011 [cited 2016 Mar 17].
- Herman JL. Costs and Benefits of Providing Transition-related Health Care Coverage in Employee Health Benefits Plans: Findings from a Survey of Employers. eScholarship. 2013 Sep 1 [cited 2016 Mar 24];
- Green J. Transsexual surgery may be covered by medicare. LGBT Health. 2014 Dec;1(4):256-8.
- National Center for Transgender Equality. Healthcare Rights and Transgender People. National Center for Transgender Equality: Know Your Rights; Healthcare. 2014 [cited 2016 Mar 24].
- Center for Medicare and Medicaid Services (CMS) and Medicare Learning Network (MLN).MLN Matters® Number MM6917: Instructions Regarding the Processing of Inpatient Claims for Gender/Procedure Conflict. MLN Matters: Information for Medicare Fee-for-Service Health Care Professionals; 2010 [cited 2016 Mar 24].
- U.S. Department of Health and Human Services (HHS): Office for Civil Rights (OCR). Nondiscrimination in Health Programs and Activities Proposed Rule - Section 1557 of the Affordable Care Act. HHS.gov. 2015 [cited 2016 Mar 24].
- U.S. Department of Health and Human Services (HHS): Office for Civil Rights (OCR). Filing with OCR. Filing with OCR. HHS.gov. 2015 [cited 2016 Mar 24].
- Office for Civil Rights (OCR). Section 1557 - Summary. HHS.gov. 2015 [cited 2016 Mar 24].
- National Center for Transgender Equality . National Center for Transgender Equality. [cited 2016 Mar 24].
- Transgender Law Center | Making Authentic Lives Possible. [cited 2016 Mar 24].