State official affirms Medicaid rules cover nonbinary people

An official at the state Office of Temporary and Disability Assistance last week overturned an insurance company's decision to deny coverage for a breast reduction procedure to treat gender dysphoria in a Medicaid recipient who does not identify as male or female.

The decision, which ends a fight that's lasted more than a year, addresses a burgeoning complication as the acceptance of transgender and nontraditional gender identities rises and those people seek medical care for their unique health needs.

The case revolved around whether the state Medicaid program's regulations on gender dysphoria treatment was exclusive to transgender people, or also included gender nonbinary or nonconforming individuals.

The now 27-year-old person, referred to in the filing as "AV," has identified as nonbinary since 2014 and sought approval for a reduction mammoplasty in 2017 in order to conform with the person's gender identity.

AV's insurer, HealthFirst — which runs Medicaid managed care plans and other low-cost health insurance plans — denied the claim last March for, among other reasons, not meeting the company's criteria for medical necessity. In its denial, HealthFirst stated that AV did not undergo hormone therapy or present sufficient documentation showing why that would be inappropriate before seeking a surgical procedure.

That decision was upheld in June following an administrative appeal.

"As a practical matter, there is no way to distinguish between a purely cosmetic procedure and one performed to allow the Appellant to 'conform' to an essentially undefined gender," the original decision stated. "[T]here was insufficient evidence at the hearing to establish that the requested procedure is in fact medically necessary and not cosmetic."

Lawyers with the Legal Aid Society pushed for a new hearing, which was granted in April. They believed that because AV identified as nonbinary or gender nonconforming, asking AV to undergo hormone therapy — as HealthFirst referenced in its denial — would run counter to treating gender dysphoria and would restrict care for similar individuals contrary to the state's intent when creating the regulations.

Gov. Andrew Cuomo in 2014 directed the Department of Financial Services to ensure that commercial insurers cover medically necessary treatment for gender dysphoria, and the Department of Health in 2015 adopted regulations covering certain procedures, which prompted a legal challenge, and was later amended to require Medicaid cover all treatments for gender dysphoria deemed medically necessary. That policy went into effect in late 2016.

OTDA's Nigel Marks, who was designated by DOH to oversee the case, agreed with AV's lawyers and wrote an 11-page decision reversing the denial and ordering HealthFirst to approve the request for breast reduction.

"HealthFirst appears asserted that a diagnosis of gender dysphoria requires the individual to conform to the gender opposite the gender assigned at birth," Marks wrote. "Requiring conformance to the opposite gender is inconsistent with the diagnosis of gender dysphoria as specified by the Diagnostic and Statistical Manual of Mental Disorders ... Therefore, the distress associated with gender dysphoria is not limited to a desire to just be of the opposite gender, but may include a desire to be non-binary."

AV's lawyers praised the decision, saying it would help prevent roadblocks for transgender individuals seeking health care.

"No New Yorker should be denied medically necessary, gender affirming health care," Heidi Bramson, staff attorney with the Legal Aid Society's Health Law Unit, said in a statement. "The Legal Aid Society is hopeful that this historic, precedent-setting decision will inform insurance plans, health care providers, judges and gender non-conforming individuals that health care discrimination on the basis of gender identity is illegal and it has no place in New York."

Representatives from HealthFirst and DOH did not return requests to comment on the decision.