Budget proposal would bar gender-affirming care under Iowa Medicaid

DES MOINES — Iowa Medicaid would no longer cover surgical, hormonal and other procedures related to treating Iowans with gender dysphoria under a budget proposal advanced by Senate Republicans.

Senate Study Bill 1237 includes a provision that states money appropriated to the Iowa Department of Health and Human Services “shall not be used for sex reassignment surgery or treatment related to an individual’s gender dysphoria diagnosis.”

HHS administers Iowa Medicaid, the joint federal and state program that helps cover medical costs for some Iowans with limited income and resources, including eligible low-income adults, children, pregnant women, older adults and people with disabilities.

From 2015 to 2024, the state has spent roughly $3.4 million on Medicaid- or Children's Health Insurance Program (CHIP)-funded surgery, hormone therapy, infertility services, mental health counseling and voice and communication therapy for hundreds of transgender individuals, according to data from the Iowa Department of Health and Human Services.

Of that, roughly $1.24 million was spent for hormone therapy and about $1.14 million on mental health counseling. About $967,000 was spent on surgery.

It’s a tiny sliver of the billions the state spends annually on Medicaid funding. The projected total Medicaid budget for the current year is approximately $9 billion, with state funds contributing $2.2 billion and federal and other funds contributing $6.8 billion.

The move comes just months after Republican Gov. Kim Reynolds signed into law legislation repealing protections for transgender Iowans against discrimination in housing, employment, lending, public accommodations and more, making Iowa the first state in the nation to remove a protected class from a state’s civil rights act.

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Reynolds and Republican lawmakers argued the protections in the Civil Rights Act endanger state laws they passed in recent years restricting transgender rights. That includes a 2023 law that bans physicians from prescribing puberty blockers and cross-sex hormones or authorizing surgery for treatment of gender dysphoria for minors under the age of 18. Under Iowa law, transgender people can no longer use the bathroom that aligns with their gender identity in K-12 schools and transgender women and girls are barred from female sports.

Supporters of the legislation pointed to the Iowa courts’ determination in 2023 that the state’s previous attempt to ban Medicaid coverage for gender transition surgery was unconstitutional. A judge cited the inclusion of gender identity in the Iowa Civil Rights Act in his ruling. The court also ruled the ban violated the Iowa Constitution's equal protection clause.

Medical associations: Gender-affirming care reduces suicide attempts

Max Mowitz, a transgender Iowan and executive director of the LGBTQ advocacy organization One Iowa, said major medical associations — including the American Medical Association, the American Pediatric Association and the American Association of Psychiatrists — recognize gender-affirming care as medically-necessary, evidence-based care that improves the physical and mental health of transgender and gender-diverse individuals.

Forgoing such care can have tragic health consequences, Mowitz warned.

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In a letter to state governors in 2021, the American Medical Association urged against limiting the practice and said gender-affirming care correlates with a reduction in mental health problems and suicide attempts.

Gender dysphoria refers to the psychological distress that can happen when a person's gender identity differs from the sex assigned at birth. If left untreated, it can cause anxiety, depression and suicidal ideation, Mowitz said.

He said blocking such care under Iowa Medicaid “would put additional strain on other systems that would need to support these folks that can access the care that they need.”

“And I don't know why we would be removing access to care that is medically necessary,” Mowitz told lawmakers Wednesday.

Keenan Crow, director of policy and advocacy for One Iowa, said the language restricting access to gender-affirming care is so broad that it could prohibit mental health treatment for gender dysphoria in addition to surgery, hormone therapy and other medical interventions.

“The most common treatment for gender dysphoria is, in fact, counseling,” Crow said. “And so we're restricting access to mental health counseling for these folks who desperately need it. This is the group of folks who has the highest suicide rate in our state. … So you have two kids coming in, both need mental health care services — one is trans; one isn't. The one who isn't gets the mental health care services. The one who is doesn't. That seems completely unfair.”

Republican Sens. Mark Costello, of Imogene, and Kara Warme, of Ames, signed off to advance the bill to the full Senate Appropriations Committee for further consideration.

Costello declined to comment on the bill’s provision prohibiting Medicaid coverage of gender-affirming care.

Sen. Molly Donahue, D-Marion, the other member of the subcommittee, declined to sign off on the bill.

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“It's already been in the courts and ruled unconstitutional. So I think we’re just going to throw this back in the courts and waste more money,” Donahue said.

Republicans control agenda setting majorities in both the Iowa House and Senate.

House bill does not limit Medicaid coverage, but it could

House Republicans’ budget proposal does not include language limiting Medicaid coverage for gender-affirming care.

Rep. Ann Meyer, R-Fort Dodge, who chairs the House HHS budget subcommittee, said House Republicans are open to working with Senate Republicans on the gender-affirming care ban as part of budget negotiations.

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“That's something that we'll have to talk about as a caucus, but it's not in my bill at this point,” Meyer told reporters Wednesday. “We passed that in 2019 in the HHS budget, and it was overturned by the court,” suggesting that the caucus might be amenable to the idea.

Meyer, though, anticipated House Republicans will want to narrow the language to not exclude mental health services for gender dysphoria, and instead limit it to restricting coverage of surgeries, hormone treatments and other medical interventions.

“Most Iowans agree that taxpayers shouldn’t be on the hook to pay for someone else’s sex reassignment surgery,” Melissa Saitz, a spokeswoman for House Speaker Pat Grassley and Iowa House Republicans, said in a statement to The Gazette.

“This policy is in alignment with what House Republicans have set out to accomplish this session — a return to common sense. We plan to work with the Senate to ensure this language accomplishes that goal and protects taxpayer dollars.”

Editor’s Note: This story was updated to include information provided May 2 by the Iowa Department of Health and Human Services on the number of Iowans who received Medicaid- or Children's Health Insurance Program-funded gender-affirming care since 2015.

Comments: (319) 398-8499; tom.barton@thegazette.com