395 F.Supp.3d 1001
W.D. Wis.2019Background
- Wisconsin Medicaid regulations (DHS 107.03(23)-(24), later including § 107.10(4)(p)) have, since 1997, categorically excluded “transsexual surgery” and associated hormones from coverage; DHS interprets that exclusion to encompass gender‑confirming procedures for gender dysphoria.
- Plaintiffs are adult transgender Wisconsin Medicaid beneficiaries who suffer gender dysphoria and whose providers have deemed hormone therapy and various gender‑confirming surgeries medically necessary; their prior‑authorization requests were denied under the Challenged Exclusion.
- Medical consensus (WPATH, Endocrine Society, AMA, DSM‑5) recognizes gender dysphoria as a serious condition and accepts hormone therapy and certain surgeries as medically necessary, safe, and effective for appropriate patients; DHS’s clinical staff acknowledged those treatments can be medically necessary.
- DHS never performed a contemporaneous, systematic medical review or cost analysis before adopting or maintaining the exclusion, and its internal reviews since adoption were minimal; estimated fiscal savings from rescinding the exclusion are actuarially negligible.
- Procedurally, the court had previously entered a preliminary injunction and certified a class; plaintiffs moved for summary judgment seeking declaratory and permanent injunctive relief to bar enforcement of the Challenged Exclusion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 1557 of the ACA forbids the Challenged Exclusion as sex discrimination | Flack: § 1557 prohibits discrimination on the basis of sex/gender identity; exclusion is discriminatory | DHS: application violates Spending Clause expectations; § 1557 should not be read to reach transgender status | Court: § 1557 provides a private right of action and exclusion violates § 1557; summary judgment for plaintiffs |
| Whether the exclusion violates Medicaid’s Availability and Comparability provisions | Flack: exclusion denies medically necessary care available for other diagnoses, so it is unreasonable and non‑comparable | DHS: exclusions are within state discretion; treatments are experimental/unproven and entitled to deference | Court: medical consensus shows treatments are non‑experimental and medically accepted; exclusion is unreasonable and violates Availability and Comparability; summary judgment for plaintiffs |
| Whether exclusion violates Equal Protection (sex‑based classification) | Flack: exclusion discriminates on basis of sex/gender identity; intermediate scrutiny applies and state must show exceedingly persuasive justification | DHS: asserted interests in cost‑containment and public health uncertainty | Court: DHS offered no genuine, evidence‑based health or cost justification; estimated savings de minimis; exclusion fails intermediate scrutiny; summary judgment for plaintiffs |
| Evidentiary challenge to defense expert Ostrander | Plaintiffs: Ostrander failed Rule 26/Daubert, relied on hearsay Hayes reports and lacks medical expertise | DHS: Ostrander adequately disclosed and is qualified to assess literature | Held: Motion to strike denied; court finds Ostrander’s opinions of limited relevance and value but not excluded |
Key Cases Cited
- Bontrager v. Ind. Family & Soc. Servs. Admin., 697 F.3d 604 (7th Cir.) (state participating in Medicaid must comply with federal requirements)
- Miller ex rel. Miller v. Whitburn, 10 F.3d 1315 (7th Cir.) (states may limit Medicaid to non‑experimental treatments but authoritative medical acceptance controls)
- Rush v. Parham, 625 F.2d 1150 (5th Cir.) (state may exclude experimental treatments; categorical denial solely because of diagnosis may be impermissible)
- Beal v. Doe, 432 U.S. 438 (U.S.) (limitations on Medicaid must be consistent with program objectives)
- Lankford v. Sherman, 451 F.3d 496 (8th Cir.) (failure to cover non‑experimental, medically‑necessary services can be per se unreasonable)
- White v. Beal, 555 F.2d 1146 (3d Cir.) (Medicaid discrimination based on etiology rather than need is impermissible)
- Davis v. Shah, 821 F.3d 231 (2d Cir.) (Comparability Provision prohibits denying services based on condition rather than need)
- Kosilek v. Maloney, 774 F.3d 63 (1st Cir.) (Eighth Amendment context discussing medical disagreement over sex‑reassignment surgery)
- Gibson v. Collier, 920 F.3d 212 (5th Cir.) (Eighth Amendment refusal to order sex‑reassignment surgery in prison setting where disagreement among experts existed)
- Smith v. Rasmussen, 249 F.3d 755 (8th Cir.) (older circuit decision upholding state restriction in light of lack of medical consensus)
- Boyden v. Conlin, 341 F. Supp. 3d 979 (W.D. Wis.) (cost savings from covering gender‑confirming care immaterial; supports heightened scrutiny analysis)