New lawsuit alleges Medicaid exemption for transgender Iowans is discriminatory, violates Civil Rights Act

In another salvo against the state in its yearslong battle on behalf of transgender Iowans, the ACLU of Iowa announced Thursday it is suing over a state law that bans Medicaid coverage for gender-affirming surgeries.

The civil liberties organization filed the lawsuit in Polk County District Court on behalf of two transgender Iowans, alleging a law excluding transition-related surgeries from public insurance funds is unconstitutional and a violation of the Iowa Civil Rights Act.

This is the third time ACLU of Iowa has filed suits against the state for policies that prevent Medicaid coverage of medically necessary treatment for transgender Iowans, ACLU officials told reporters Thursday.

“We are frustrated, clients are frustrated and we know Iowans are frustrated that the state keeps reviving this discriminatory rule,” said Rita Bettis Austen, ACLU of Iowa legal director.

The lawsuit seeks to strike down a law passed by the 2019 Iowa Legislature that amended the Iowa Civil Rights act to allow any state or local government entity to decline to use public insurance, including Medicaid, to pay for transition-related surgeries.

The suit is a reiteration of an earlier lawsuit filed by ACLU of Iowa on behalf of Aiden Vasquez of Central Iowa and Mika Covington of Southeast Iowa, who both are transgender and qualify for Medicaid.

That earlier suit was thrown out by the Iowa Court of Appeals in August 2020. The court did not uphold the law, but because neither individual had been denied Medicaid coverage under the new rule yet, the dispute was “speculative,” according to the court.

Vasquez since has been denied coverage for transition-related care, Bettis Austen said. She added that Covington will join the suit if she also is denied Medicaid coverage.

“It’s hard knowing that the state has gone out of its way to discriminate against me and block my medical care just because I’m transgender, when other Iowans on Medicaid are able to get coverage for the surgeries they need,” Vasquez said in a statement.

Both Iowans are seeking the care to treat gender dysphoria, or the distress or discomfort that may occur in individuals whose gender identity differs from their physical characteristics. While others may seek other forms of gender affirmation, medical and surgical avenues are common types of gender affirming care.

Gender dysphoria can result in serious risk factors, including depression, anxiety as well as an increased risk of death by suicide.

Vasquez said being unable to access that medical care “has threatened my mental well-being.”

“I am a man, but in a body that does not reflect who I am,” he said. “That’s why this surgery will be life-changing.”

Major medical groups, including the American Medical Association and the American Psychological Association, agree that transition-related surgeries and other care are medically necessary when prescribed by a doctor.

“Being able to finally get the surgery that my doctors have determined is medically necessary for me will do nothing less than give me my life back,“ Covington said in a statement. ”It will help me build a life in which my body is in harmony with my gender, so I can overcome the depression, lack of confidence, isolation, and other problems my gender dysphoria causes."

Battles fought before

The measure was passed as an amendment to a health budget bill at the end of the 2019 legislative session.

That rule was in direct response to an Iowa Supreme Court decision in March 2018 that struck down an administrative code that restricted Medicaid dollars for gender-affirming surgeries. In their ruling, the justices held that denying Medicaid reimbursement for surgeries to treat gender dysphoria violates protections under the Iowa Civil Rights Act. The act has outlawed discrimination on the basis of gender identity or sexual orientation since 2007.

The ruling was a first by the state Supreme Court affirming rights of transgender Iowans under the Iowa Civil Rights Act, according to officials with ACLU of Iowa at the time.

The organization filed the lawsuit in 2017 on behalf of two other Iowans, Carol Ann Beal and EerieAnna Good, who were denied coverage for gender-affirming surgeries by their managed care organizations — the insurance companies that administer the state’s Medicaid program.

ACLU of Iowa also had been involved in a previous litigation against private insurers for access to gender-affirming surgeries, and represented a transgender Iowan who won a discrimination lawsuit against the state in early 2019.

Jesse Vroegh, a former Iowa Department of Corrections nurse who identifies as male, filed suit alleging the health insurance plan for Iowa’s public employees contained a specific exclusion for transition-related surgeries.

The suit also alleged the department had denied his requests to use the men’s restrooms and locker rooms at the Iowa Correctional Institution for Women where he worked. In ruling in his favor, a jury awarded Vroegh $120,000 in damages.

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