Florida Fines Medicaid Providers for Using Taxpayer Money to Cover Transgender Procedures

American flags along with the Florida state flag are carried in a tray at a political campaign event in Miami, Fla., on Aug. 18, 2023. (Joe Raedle/Getty Images)

Florida on Thursday took legal action—including fines—against five Medicaid health care insurers that broke the state’s rules against using taxpayer funds to cover transgender procedures.

A spokesperson for the Florida Agency for Health Care Administration (AHCA) told The Epoch Times in an emailed statement that the agency has issued cease and desist letters and imposed financial penalties on five insurers for “illegal, harmful medical practices” that they covered for health care providers.

In August 2022, the agency introduced a regulation (pdf) called Rule 59G-1.050(7)(a) that explicitly excluded coverage under Florida Medicaid for a series of treatments for gender dysphoria.

Prohibited from Medicaid coverage were procedures like puberty blockers, sex reassignment surgeries, and “any other procedures that alter primary or secondary sexual characteristics.”

The ban was challenged in court in September 2022 in a case known as Dekker v. Weida, and a judge blocked the rule in a June 21, 2023 injunction (pdf), a decision that AHCA has appealed (pdf).

While the Medicaid transgender procedure coverage ban appears to be on hold while the appeal makes its way through the courts, the rule was in effect when AHCA carried out an audit of Medicaid insurers between Dec. 1, 2022, and Feb. 28, 2023.

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The AHCA spokesperson told The Epoch Times in an emailed statement that, during the period in question, the agency found instances where the five insurers—Simply, Sunshine, Children’s Medical Services, Molina, and Humana—covered puberty blockers and cross-sex hormones despite the coverage ban.

“In Florida, we follow the science and the law. After thorough investigation, the Agency is holding accountable Medicaid Health Plans found in violation of an administrative rule by covering mutilation surgeries and experimental medications, including puberty blockers for minors," AHCA Secretary Jason Weida told The Epoch Times in an emailed statement.

In one instance, the agency found that one of the insurers covered a double mastectomy for a minor seeking so-called “gender-affirming care.”

“These plans recklessly continued to cover these services with permanent, harmful effects, after the rule was adopted. These Health Plans will not stand in the way of our fight to protect the innocence of Florida’s kids,” Mr. Weida added.

The Epoch Times has reached out to all five insurers with requests for comment but no replies were received prior to publication.

Legal Challenge

Last August, when AHCA enacted the rule, it revoked state Medicaid coverage for treatment of gender dysphoria including hormone therapy, puberty blockers, and sex reassignment surgeries.

That came after the Florida agency announced findings of a review in June 2022 (pdf) that concluded that such procedures were “not consistent with generally accepted professional medical standards and are experimental and investigational with the potential for harmful long-term [e]ffects.”

“Scientific studies supporting hormone replacement therapy, puberty blockers, and sex reassignment surgery for treating gender dysphoria are weak to very weak,” AHCA said in the report.

“The evidence showing benefits from hormone replacement therapies for gender dysphoria is very weak … Scientific studies do not show that the use of puberty blockers improves mental health,” it added.

The rule was challenged in a lawsuit brought on behalf of two transgender-identifying adults and two transgender-identifying minors represented by Lambda Legal, Florida Health Justice Project, the National Health Law Program, Southern Legal Counsel, and Pillsbury Winthrop Shaw Pittman, LLP.

In the complaint, the plaintiffs argued that so-called “gender-affirming care” should be considered “medically necessary, safe, and effective” for both adults and adolescents and that AHCA discriminated against transgender people by denying Medicare coverage for transgender procedures.

In April 2023, seventeen attorneys general filed an amicus brief (pdf) in support of AHCA’s rule, arguing that the treatments that the plaintiffs claimed were “medically necessary” were in fact experimental and potentially dangerous.

Louisiana Attorney General Jeff Landry said in a news release at the time that the plaintiffs relied heavily on medical interest groups to argue that the treatments were widely supported by the medical community, while noting that Florida had openly assessed the evidence and concluded that the procedures should be restricted.

“Our tax dollars should not be spent on life-altering and damaging experimental medical treatments,” Mr. Landry said in a statement.

“Florida’s comprehensive review does not support the use of puberty blockers, cross-sex hormones, and reassignment surgeries as safe and effective treatments for gender dysphoria; and the Sunshine State should be allowed to follow the science,” he added.

However, following a two-week trial in May 2023, Judge Robert L. Hinkle ruled against Florida’s Medicaid coverage ban for transgender procedures.

The judge said in his order (pdf) that the rule violates the federal Medicaid statute, the Equal Protection Clause, and the Affordable Care Act’s prohibition of sex discrimination.

“It is declared that Florida Statutes § 286.31(2) and Florida Administrative Code rule 59G 1.050(7) are invalid to the extent they categorically ban Medicaid payment for puberty blockers and cross-sex hormones for the treatment of gender dysphoria,” the judge wrote.

Lambda Legal, one of the law firms that filed the lawsuit against AHCA, hailed the ruling in a statement.

“We are gratified by today’s result which protects access to care for some of the most vulnerable Floridians, transgender Medicaid beneficiaries,” Omar Gonzalez-Pagan, counsel and health care strategist at Lambda Legal, said in a statement.

“Through overwhelming evidence, we demonstrated that gender-affirming care is not experimental but rather essential, safe, and effective medical care,” he added.