The Department of Health and Human Services announced it will no longer provide federal Medicaid or CHIP funding for gender transition procedures for minors, effective Aug. 11.
The Centers for Medicare and Medicaid Services is implementing the policy change simultaneously, cutting off federal funding pathways for such treatments on children and youth through both programs. The administration characterized the procedures as experimental and life-altering.
The decision directly affects the federal cost-sharing structure with states that currently cover gender transition treatments for minors under Medicaid. Under Medicaid’s joint funding model, the federal government typically pays between 50% and 77% of program costs depending on the state.
States that wish to continue covering gender transition treatments for minors would need to fund them entirely with state dollars, according to HHS. That requirement could force difficult fiscal choices in states that have expanded gender-affirming care under their Medicaid programs.
The policy change is expected to trigger legal challenges. Several states and advocacy organizations have contested similar restrictions in federal court, arguing that denying coverage based on a patient’s gender identity violates federal anti-discrimination protections.
CHIP, the Children’s Health Insurance Program, covers approximately 7 million children in families that earn too much to qualify for Medicaid but cannot afford private insurance. The inclusion of CHIP in the funding cutoff expands the scope of the policy beyond Medicaid alone.
The announcement follows a broader pattern of state-level restrictions on gender transition treatments for minors. More than 20 states have enacted laws limiting or banning such procedures for people under 18.