This overview is excerpted from Manatt on Health, Manatt’s subscription service that provides in-depth insights and analysis focused on the legal, policy and market developments. For more information on how to subscribe to Manatt on Health, please reach out to Barret Jefferds.
On May 6, the state of Florida and medical providers filed a lawsuit against HHS, claiming the provisions on gender identity in the Section 1557 nondiscrimination final rule, published on the same day, violate the Administrative Procedure Act (APA), the Spending Clause, and the First Amendment.1 The lawsuit asks the U.S. District Court for the Middle District of Florida for a preliminary injunction or postponement of the rule’s July 5 effective date and for vacatur of the entire rule. Section 1557 of the Affordable Care Act prohibits discrimination in federally funded health programs or activities on the basis of sex (among other characteristics). The new final rule interprets this prohibition on sex discrimination to include discrimination on the basis of gender identity. The rule prohibits a covered entity from denying services for gender-affirming care that the entity would provide to other enrollees for other purposes, if the denial is based on an individual’s gender identity.
Florida alleges that the rule seeks to “redefine the practice of medicine” by requiring treatment of gender dysphoria and gender-affirming care in federal programs, including Medicaid, in a way that violates the APA, asserting that it exceeds the statutory mandate and is arbitrary and capricious. The state says the rule exceeds the statute, which “specifically excludes” terms related to gender identity. Further, in making categorical exclusions denying certain treatments impermissible, the rule second guesses state medical boards and providers and instead turns over individual clinical decisions to the HHS Office for Civil Rights. The rule, it claims, violates the Spending Clause by threatening to withdraw billions of dollars in federal funding for noncompliance.
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1 For more on the Section 1557 rule, see the Manatt on Health summary here.