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May 22, 2019
With the increased visibility and calls for equity for transgender and non-binary (i.e. individuals who do not identify with either male or female genders1) individuals, many of our Washington State healthcare and nonprofit clients have recently received questions from employees about medical coverage for gender health services. Our laws are evolving in an effort to protect, respect, and care for transgender and non-binary individuals, and this has been adopted in recent years into our employer-sponsored health plans. When examining coverage for gender health services, it is important to understand the compliance implications, coverage requirements, potential challenges with coverage that might occur, and finally how you can best support transgender and non-binary employees.
Applies to fully insured plans (the insurance carriers must comply) – “Individuals may not be denied, cancelled, limited, or refused health coverage on the basis of race, color, national origin, sex, age, or disability.” The U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) released a final rule for nondiscrimination in health programs and activities in 2016. The law included expanded protection for transgender individuals: “Insurers and group health plans cannot limit accessibility to health services typically or exclusively available to one gender.” In plain terms, specific health services must be fully available to everyone, regardless of an individual’s gender assigned at birth, gender identity, or recorded gender.
Please note that 1557 can also apply to self-funded plans that are considered a “covered entity” under the rules. A covered entity is an organization that received federal funds related to the provision of healthcare administered by the Department of Health and Human Services (DHHS). Typically, this will only apply to self-insured plans sponsored by medical providers.
“The diagnosis of “gender dysphoria” (see below) is a behavioral condition for which limitations should not be applied. If there are limits around transgender benefits (e.g., transgender therapy), there is potentially a mental health parity issue if similar limits are not also applied to other medical conditions and benefits.”
“Requires all employers (regardless of whether they are covered by Section 1557) to comply with similar nondiscrimination requirements under Title VII of the Civil Rights Act of 1964.” However, there is significant legal debate as to if the EEOC rules require any kind of coverage under a health plan.
If a health insurer covers medically necessary services for its enrollees, it cannot exclude or deny those services for a transgender person because of the person’s gender identity. Health insurers must cover procedures that are part of a gender transition process if they’re covered for other policyholders for different reasons.
The common requirement for transgender coverage under fully insured plans is a diagnosis of “gender dysphoria.” DSM-5 (Diagnostic and Statistical Manual of Mental Disorders) defines it as4: people whose gender at birth is contrary to the one they express/experience. The critical element for gender dysphoria diagnosis is the presence of clinically significant distress associated with the condition.
Examples of fully insured plan coverage that would be utilized by individuals diagnosed with gender dysphoria include:
On most fully insured contracts, surgeries primarily for feminization or masculinization are considered cosmetic and are exclusions.
Employers with self-funded health plans are subject to the EEOC non-discrimination rules and the Mental Health Parity and Addiction Equity Act (MHPAEA), and therefore are being advised to cover transgender services as a fully insured plan would, and to remove any existing blanket limitations for these services. Some self-funded groups may choose to offer additional benefits by covering WPATH-recommended surgeries and services, including services that are considered cosmetic under fully insured contracts. There is indeed a cost-related concern for self-funded plans, as costs and services will vary widely depending on where an individual may be in their transition and the desired services.
A large number of surgeons who
perform [transgender] services do
not contract with any health plan
Many of our clients report difficulties with medical provider contracting when their employees have sought services for transgender-related surgeries. A large number of surgeons who perform these services do not contract with any health plan networks, leaving the employee in a position where their provider is out-of-network. Even if the plan pays all services as in-network, there may still be the issue of balance billing.
Typically an employee record in an insurance carrier or TPA’s claim system includes a gender indicator, “male” or “female.” When the gender indicator in the claim system doesn’t match the carrier’s required gender for the service provided (e.g. mammogram when the gender indicator is male), this can cause an automatic claim denial. Requesting a case manager assignment at the insurance carrier or TPA can help to alleviate denied claims. Many carriers have recently adjusted their claim systems to accommodate these circumstances. In addition, Washington State has recently allowed the gender “X” on birth certificates for non-binary individuals; however issues still arise with medical services, as most electronic medical record (EMR) systems don’t currently accommodate gender “X.”
Kaiser Permanente offers the following suggestions6:
As regulations continue to evolve and change, it is important to ensure that your benefits program is compliant, well communicated, and supported, especially in the case of gender benefits, which can be extremely complex. Call an experienced employee benefits broker to learn more.
The views and opinions expressed within are those of the author(s) and do not necessarily reflect the official policy or position of Parker, Smith & Feek. While every effort has been taken in compiling this information to ensure that its contents are totally accurate, neither the publisher nor the author can accept liability for any inaccuracies or changed circumstances of any information herein or for the consequences of any reliance placed upon it.