Judge Rules Federal Rule on Gender Discrimination Violates Catholic Beliefs

An update to the rule does not eliminate the violation, the judge said.

The U.S. Department of Health and Human Services at the Hubert H. Humphrey building in Washington on April 28, 2025. Madalina Vasiliu/The Epoch Times

A rule from the Department of Health and Human Services (HHS) violates the beliefs of members of a Catholic association, a federal judge ruled on June 5.

The HHS rule requiring members of the Catholic Benefits Association to perform transgender procedures “violates their sincerely held religious beliefs without satisfying strict scrutiny,” U.S. District Judge Peter Welte said in a 19-page decision.

He permanently blocked HHS from enforcing the rule against the association and its current members.

The ruling also prevents the Equal Employment Opportunity Commission from requiring the association and its members to provide insurance coverage for transgender procedures.

Spokespersons for the agencies declined to comment.

The association, which says it has more than 9,000 provider members, did not return an inquiry.

At issue is Section 1557 of the Affordable Care Act, commonly known as Obamacare. That section of the Act bars discrimination on grounds outlined in other laws, including Title IX, which prohibits discrimination “on the basis of sex.”

HHS in 2016 said that discrimination on the basis of sex included discrimination on the basis of “gender identity,” and that health providers could not refuse to offer transgender procedures if the provider offered similar services to others. One example offered was that a provider that removed uteruses to treat female health problems was also required to perform hysterectomies for women who believe they’re transgender and want the procedure.

The Catholic Benefits Association sued over the interpretation and won an injunction.

HHS in 2020 updated the rule, removing the part about gender identity. That same year, the Supreme Court ruled that “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex,” prompting a court to rule that the HHS gender identity discrimination prohibition remained in effect.

Welte later ruled in favor of the Catholic Benefits Association, concluding that the rule infringed on the association members’ exercise of religion in violation of the Religious Freedom Restoration Act. That law allows the government to substantially burden the exercise of religion, but only if it shows it is using the least restrictive means available to achieve a compelling interest.

An appeals court overturned the decision because, judges said, the association failed to show standing since it did not identify specific members and their injuries.

The association brought a new suit identifying members and their injuries, resulting in Thursday’s ruling.

HHS had amended the rule again in 2024, reinstating the explicit prohibition on discrimination on the basis of gender identity. It also barred discrimination on the basis of “pregnancy or related conditions,” which officials said included abortion.

Government lawyers said that the latest version of the rule does not violate the Religious Freedom Act because of a new process that enables providers to seek religious exemptions to the requirements.

Welte disagreed.

“The case-by-case exemption procedure leaves religious organizations unable to predict their legal exposure without furthering any compelling antidiscrimination interests,” he said.

The judge did rule in favor of the government with regard to the requirements for covering “pregnancy or related conditions,” finding the Catholic association did not provide evidence that the requirement violates their members’ religious beliefs.

He also declined to extend the block on enforcement of the gender discrimination prohibition to future association members. That would “stray too far from the principle of party-specific relief,” he said.