Texas and Montana are suing the Biden administration over a new rule that would prohibit state Medicaid programs from banning gender-affirming care.
The lawsuit from Texas Attorney General Ken Paxton (R) and Montana Attorney General Austin Knudsen (R), filed Monday, asks a federal court to vacate a sweeping final rule aimed at bolstering health care protections against discrimination for gay and transgender people.
“Through a sweeping new rule promulgated under the Affordable Care Act (ACA), those who do not conform to the Biden Administration’s gender-ideology regime stand to lose all federal healthcare funds, including Medicaid and Medicare dollars,” the lawsuit states.
The lawsuit argues the rule is an unconstitutional attempt to override state law, and that the ACA never authorized the U.S. Department of Health and Human Services (HHS) or any government agency to compel institutions to perform or pay for gender-affirming treatment.
The complaint centers on Section 1557 of the ACA, which prohibits discrimination on the basis of race, color, national origin, sex, age and disability in certain health programs and activities.
Section 1557 has been subject to a wave of litigation in the past decade, as advocacy groups and lawmakers have fought over how the policy should be interpreted.
The Obama-era rule interpreted sex nondiscrimination protections to include gender identity and sex stereotyping (among other identities) but not sexual orientation. The Trump administration removed those protections, but the Biden administration then moved to reinstate and expand them by adding sexual orientation.
The Biden administration’s final rule, which was released at the end of April, said organizations receiving federal health funding and health insurers that do business through government plans cannot refuse to provide gender-affirming care services that would be provided to an individual for other purposes.
In addition, the rule categorically prohibited exclusions of gender-affirming care.
For example, if a covered entity would perform a hysterectomy for the purpose of treating uterine cancer, it must also be willing to remove a healthy uterus for the purpose of facilitating a gender transition.
The Biden administration made it clear in the rule that federal protections for religious freedom and conscience still apply. Those protections say health providers are not engaging in discrimination if they decline to provide abortion or any other care if it conflicts with a “sincerely-held belief.”
But the rule makes clear that Section 1557 preempts state laws that prohibit access to gender-affirming care.
“The rule will wreak financial havoc on Montana’s medical system as the state receives around two-billion dollars in federal financial aid administered by HHS every year. This new rule places unlawful strings on that aid, penalizing Montana for attempting to protect its citizens from harmful medical procedures and for declining to insure those procedures in its health plans,” Knudsen said in a statement.