Health insurance plan can’t exclude gender-transition surgeries, court rules

(The Daily Signal) – A federal court is declaring that employers must cover gender-transition surgeries for their employees in their health insurance plans.

The U.S. Court of Appeals for the…

(The Daily Signal) – A federal court is declaring that employers must cover gender-transition surgeries for their employees in their health insurance plans.

The U.S. Court of Appeals for the 11th Circuit ruled last week that a refusal by an employer to cover gender-transition surgeries in an employee’s health insurance violates Title VII of the Civil Rights Act of 1964, which “prohibits employment discrimination based on race, color, religion, sex and national origin.”

In the court’s majority opinion, Clinton-appointed Judge Charles R. Wilson wrote, “Generally, discrimination in the Title VII context occurs when an employer intentionally treats an employee worse than other similarly situated employees.” Citing the U.S. Supreme Court’s ruling in Bostock v. Clayton County, he then explained that “an employer who discriminates based on transgender status is intentionally treating that employee differently ‘because of their sex.’”

The case began when Anna Lange, a biological male who identifies as a woman, sought a gender-transition surgery in 2018. Lange had at the time been employed by the Houston County Sheriff’s Office in Georgia for more than 10 years. Houston County’s health insurance plan, which also covers employees of the Sheriff’s Office, excludes coverage of “[d]rugs for sex change surgery” and “[s]ervices and supplies for a sex change and/or the reversal of a sex change … .” Lange filed an appeal with Anthem Blue Cross Blue Shield, the organization that administers Houston County’s health insurance plan, but was denied.

Lange also petitioned the Houston County Board of Supervisors to remove the exclusion before finally filing a lawsuit against Houston County and the Sheriff of Houston County, claiming violations of Title VII, Title I of the Americans with Disabilities Act (ADA), and the equal protection clause of the U.S. Constitution.

A district court ruled in Lange’s favor regarding the Title VII violation, but determined that Houston County did not violate the ADA. At trial, a jury awarded Lange $60,000 in damages and the court permanently barred Houston County and the Sheriff’s Office from enforcing or applying the exclusion in its health insurance plan.

Houston County and the Sheriff’s Office then sought a stay of the order from the 11th Circuit Court, which was denied.

In his opinion last week, Wilson wrote, “[W]e conclude that the district court was correct in finding that the Exclusion violated Title VII. There is no genuine dispute of fact or law as to whether the Exclusion unlawfully discriminates against Lange and other transgender persons.”

He continued, “The Exclusion is a blanket denial of coverage for gender-affirming surgery. Health Plan participants who are transgender are the only participants who would seek gender-affirming surgery. Because transgender persons are the only plan participants who qualify for gender-affirming surgery, the plan denies health care coverage based on transgender status.”

Trump-appointed Judge Andrew L. Brasher dissented from the majority, arguing that the exclusion of gender-transition surgeries from the health insurance plan was not discriminatory toward employees who identify as transgender but “is consistent with the pattern in the rest of the insurance plan: it covers medically necessary treatments, but excludes particularly expensive, top-of-the-line procedures.”

Brasher wrote, “Lange argues, and the majority holds, that excluding sex-change operations on the face of this policy necessarily means that the County is intentionally discriminating against transgender people because of sex. I disagree.” He continued, “Although the policy does not cover sex-change surgeries, it doesn’t treat anyone differently based on sex, gender nonconformity, or transgender status.”

“Unlike the employees in Bostock, who were fired because they identified with a gender different from their natal sex, this health insurance plan does not deny medical coverage to participants ‘simply for being … transgender,’” Brasher reasoned. “The County’s insurance plan covers transgender people and provides treatments for gender dysphoria. Lange’s sex is not relevant to the County’s insurer at all. All that matters is whether Lange is asking the insurer to pay for the constellation of medical procedures known as a ‘sex change.’”

“The exclusion for sex change surgery is consistent with other exclusions for treatments for sexual dysfunction, cosmetic surgery, bariatric surgery, and the like. And the exclusion applies equally to sex change reversals,” Brasher further argued (emphasis in original). “If the plan discriminated against participants because of gender stereotypes, it would cover procedures to align a participant’s physical characteristics with those of his or her natal sex. Instead, the plan refuses to pay for a suite of medical procedures whether the goal is to align with natal sex or differ from natal sex.”

The majority opinion says that it doesn’t matter that the insurance plan covers transgender people and gender dysphoria because an employer ‘is not shielded from liability when it engages in discriminatory practices concerning some treatment and not others.’

But the majority is missing the point. The point is that, on the face of the plan, it does not draw a line between procedures transgender people need and procedures that other people need. Instead, the plan draws a line between sex-change operations and other operations.

In his majority opinion, Wilson attempted to address Brasher’s argument. “According to the dissent, ‘the plan draws a line between sex-change operations and other operations.’ … But this kind of line-drawing is precisely what makes the plan discriminatory,” Wilson claimed. “By drawing a line between gender-affirming surgery and other operations, the plan intentionally carves out an exclusion based on one’s transgender status. Lange’s sex is inextricably tied to the denial of coverage for gender-affirming surgery.”

Wilson further argued, “An employer is not shielded from liability when it engages in discriminatory practices concerning some treatment and not others. Each instance of discrimination presents an independent violation. … If we were to find otherwise, Title VII would be rendered obsolete.” He concluded, “The Exclusion is a facially discriminatory policy, and its harmful effects are not mitigated by the existence of other nondiscriminatory policies.”

In his dissent, Brasher noted the flaws he saw in the majority’s opinion, claiming that Wilson’s reasoning doesn’t “equalize fringe benefits,” but instead “treats certain people more favorably than others. Under the majority’s view, an insurance policy can exclude coverage for obesity. It can decline to cover cosmetic procedures to hide scars and repair mastectomies. It can even decline to cover expensive, lifesaving cancer treatment.” Brasher added, “But an employer-provided insurance plan must always cover every treatment for gender dysphoria. There is no basis in the text of Title VII for that result.”

“For this policy to facially discriminate against transgender people, coverage under the policy must turn on sex, a gender stereotype, or transgender status. It doesn’t,” Brasher concluded. “Because the exclusion is not facially discriminatory under Title VII, I would reverse the district court’s grant of summary judgment, vacate the permanent injunction, and remand for further proceedings.”

In a news release, the Transgender Legal Defense and Education Fund touted the majority ruling as a “historic win.” Of note, the fund boasted that the Civil Rights Office of the U.S. Department of Justice had filed an amicus brief in support of Lange.