Health officials in Maryland are moving for the first time to provide transition-related health care coverage to low-income transgender residents who receive Medicaid in the state.
"We are in the process of submitting state regulations and will seek federal approval for the expansion of transgender health care coverage by April 1, 2015," a Department of Health and Mental Hygiene spokeswoman confirmed.
The action mirrors a similar move the state took this summer, amid negotiations with advocacy organizations, to provide state employees access to gender reassignment surgery, hormone therapy and other transition-related care under their state-provided health insurance plans.
The "same terms" of coverage will now be provided to Medicaid patients, said Karen Black, the spokeswoman. The state expects fewer than five people to request reassignment surgery under the new policy per year, and the associated costs to remain less than $325,000.
The move continues a trend toward greater recognition of transgender rights following the state's passage of the Fairness for All Marylanders Act of 2013, which banned transgender discrimination in employment and other public accommodations. The law does not specifically address health insurance, but has "communicated a strong public policy in the state against discrimination based on gender identity" in all public arenas, said Jer Welter, managing attorney at Free State Legal, one of the lesbian, gay, bisexual and transgender advocacy organizations that has been pushing the state on transgender insurance issues.
"We're seeing that public policy reflected now in other areas," he said, calling the Medicaid expansion effort a "tremendous move" by the state.
"We're very excited about this development," he said.
Maryland became the third state in the country to remove transgender care exclusions from its employees' state health plans in July, after Oregon and California. That change came about after Free State Legal brought a discrimination case against the state on behalf of Sailor Holobaugh, at the time a clinical research assistant in neurology at the University of Maryland School of Medicine in Baltimore.
Holobaugh's case began in November 2012, when Holobaugh paid more than $6,000 out of pocket for a bilateral mastectomy as part of his transition, then said he was denied reimbursement for the surgery by provider BlueCross BlueShield based on coverage restrictions under his state-provided policy.
This latest move by Maryland to extend such coverage to Medicaid recipients as well was more "proactive," Welter said. It was made with the recommendation of the state's Medicaid Advisory Committee and in consultation with Free State Legal and other LGBT advocacy groups -- including Equality Maryland, the state's largest.
In a statement, Equality Maryland said it will continue to work with the state to ensure the new regulations "are consistent with recognized standards of care for transgender patients."
Welter said there was no vocal opposition to the change, but he expects there may be some when the new regulations are finalized and made available for public comment.
He said he does not expect the change to face opposition at the federal level. Such exclusions were removed for Medicare patients in May, and from federal employees' health insurance plans in June.
"We have been seeing a shift on the issue of these outdated insurance exclusions, both at the federal level and at the state level in Maryland and in several other states, over the past year, year and a half," he said.
Similar changes have taken effect in the District of Columbia and in California, Massachusetts, Vermont and Oregon. A lawsuit seeking a similar change has been filed in New York.
Welter said policy shifts in other localities, including San Francisco, have been shown to have "negligible" costs, in part because transgender people make up a small percentage of the overall population.
Also, while procedures related to transition care "are very expensive for an individual to self-fund," they are not more expensive than other procedures patients routinely undergo, he said.
Welter said Free State Legal's next target will be insurance providers regulated by the Maryland Insurance Administration, including those on the state's health exchange.
In January, the insurance administration issued a "clarification" of essential health benefits in the state, saying providers could not discriminate against transgender patients seeking "medically necessary items or services," but could deny coverage of care "directly related to the gender reassignment process."