Regulators in California and Oregon have quietly directed some health insurance companies to stop denying coverage for transgender patients because of their gender identity.
The states aren't requiring coverage of specific medical treatments. But they told some private insurance companies they must pay for a transgender person's hormone therapy, breast reduction, cancer screening or any other procedure deemed medically necessary if they cover it for patients who aren't transgender.
The changes apply to companies insuring about a third of Oregonians and about 7 percent of Californians, but not to people on Medicare and Medicaid or to the majority of Californians who are insured through a health management organization, or HMO.
Advocacy groups said the action is a major step forward in their long battle to win better health care coverage for transgender Americans.
"It's just a matter of fairness,'' said Ray Crider, a 28-year-old transgender man from Portland. "I just never felt that I was like anybody else. I see everybody else being taken care of without having to fight the system."
Officials in both states said the new regulations aren't new policies but merely a clarification of anti-discrimination laws passed in California in 2005 and in Oregon two years later.
Many health insurance policies broadly exclude coverage of gender identity disorder or classify it as a pre-existing condition. Transgender patients are often denied coverage for medical procedures unrelated to a gender transition, advocacy groups said, because insurance companies deem the condition to be related to their sex reassignment.
Some transgender patients also have trouble getting access to gender-specific care. A person who identifies as a man might be denied coverage for ovarian cancer screening or a hysterectomy. A transgender woman might be denied a prostate screening.
The state insurance regulators said those procedures, if covered for anybody, must be covered for all patients regardless of their gender.
Masen Davis, director of the Transgender Law Center in San Francisco, said he's unaware of insurance regulators in any other state taking similar action.
The California regulations took effect in September and apply only to insurance products regulated by the California Department of Insurance. The agency primarily regulates preferred provider plans, or PPOs, that covered about 7 percent of the population in 2010, according to data from the California Health Care Foundation.
The agency that regulates California HMOs has discussed transgender care with consumer groups and health plans, "but no regulations have yet been proposed or adopted,'' said Marta Bortner Green, a spokeswoman for the Department of Managed Health Care.
The Oregon Insurance Division issued its guidance last month in the form of a bulletin to insurers. It applies to commercial insurance companies that cover about a third of the state's population; the rest are uninsured, on Medicare or Medicaid, or work for a large employer that's self-insured.
"This is a very historic bulletin, and it really indicates that the tide is turning on this issue,'' said Tash Shatz, transgender justice program manager at Basic Rights Oregon, an advocacy group.
Transgender advocates say gender reassignment, through hormone treatment or surgery, is medically necessary, and they've long fought insurance companies that argue the procedures are cosmetic. They hope the new state regulations will mean fewer procedures are refused and make it easier to appeal a denial.
The transgender community has picked up significant momentum securing health coverage in recent years. San Francisco in 2001 became the first U.S. city to cover sex reassignment surgeries for government employees. Seattle, Portland, Ore. and Berkeley, Calif., have followed suit.
Large employers are increasingly offering coverage for a broad spectrum of care, including gender reassignment surgeries.
State regulators don't have authority to force insurance companies to cover specific procedures, like hormone therapy or genital reconstruction. But they've told insurers that if they provide breast reduction for patients with back pain, they can't deny it for a gender reassignment that's been deemed medically necessary. Insurers could unilaterally exclude coverage of, say, breast implants, but it would have to apply to all policyholders equally, including breast-cancer patients.
"We've received the Oregon Insurance Division's directive to implement this new mandate, and we are working to ensure that our members' future coverage aligns,'' Scott Burton, a spokesman for Regence BlueCross BlueShield of Oregon, said in a statement.
"We're still assessing the impact of the ruling, and will continue to monitor state and federal guidance on this topic,'' said Kathy Born, a spokeswoman for LifeWise, another large insurer in Oregon.
When Ray Crider heard the news, he danced around his apartment with his wife. A 28-year-old transgender man living in Portland, Crider fought a long battle to convince a previous employer to include transgender services in his policy.
Although he was insured, Crider paid thousands of dollars out of his pocket for testosterone treatment and mental health care before winning his fight for coverage of gender identity. He finally got a double mastectomy, covered by insurance, a year ago, he said, but not before the binder he used to flatten his chest required several emergency room trips because it constricted his breathing.
"This was one of the most incredible things that could ever happen,'' Crider said, "to know that there's a state full of people who won't have to go through what I went through.''
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