CMS To Halt Taxpayer Funding For “Sex-Rejecting” Procedures on Minors in October

The Centers for Medicare & Medicaid Services (CMS) announced this week that, beginning on October 13, 2026, Medicaid and CHIP can no longer be used to cover “sex-rejecting procedures” for children, also known colloquially as “gender affirming care procedures.” Williams Institute estimates that approximately 276,000 transgender adults are enrolled in Medicaid, but numbers of transgender children in the program are not publicly available. CMS identified about $31 million in “total computable (Federal and State shares) Medicaid and CHIP spending for these services and individuals” for 2023. The rule is expected to save about $235 million over the next 10 years.

“Today, we are ending federal taxpayer funding for sex-rejecting procedures on children,” U.S. Department of Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr., said. “These interventions carry serious risks and can cause irreversible harm. The federal government will no longer use Medicaid and CHIP dollars to fund procedures that fail to meet the evidentiary standard our children deserve.”

CMS cited irreversible damage that occurs when sex-rejecting procedures are performed on children, including “infertility, impaired sexual function, diminished bone density, altered brain development, and other lasting physiological effects.” The agency also referenced the HHS review of national and international research that found “significant evidence gaps, documented serious safety concerns, and concluded that the evidence supporting these interventions for children remains insufficient to justify federal taxpayer funding.“

“Children deserve our protection, not experimental interventions that pose serious risks and convey no proven benefits,” said CMS Administrator Dr. Mehmet Oz. “By cutting off federal funds for these sex-rejecting procedures, we’re following the science, saving taxpayer dollars, and, most importantly, protecting children from potentially irreversible harm so they can truly flourish.”

Children currently on hormone therapy will continue to access Medicaid and CHIP funding for these procedures for up to six months for a tapering-off period. Mental health services for gender dysphoria will not be impacted by the latest rule.

Many states have already halted sex-rejecting or gender-affirming procedures from Medicaid, but an estimated 58% of transgender people (13 and older) live in states that have policies that explicitly cover these procedures as part of their state Medicaid program. When the latest federal rule takes effect in October, those individuals can no longer access those services with Medicaid funding.

The Human Rights Campaign (HRC), the largest LGBTQ political lobbying group in the US, issued a statement condemning the rule and the actions taken by the Trump administration.

“Every young person is entitled to the health care that they, their parents, and their medical providers agree that they need, without politicians interfering with these important and highly personal decisions,” said Human Rights Campaign President Kelley Robinson. “And yet, rather than working to make healthcare more affordable and accessible, the Trump administration continues to obsess over the healthcare needs of trans youth, this time by cutting off health insurance coverage for those who rely on Medicaid and CHIP to access that care. The Trump administration is terrorizing trans youth and their families with these kinds of actions, and it has to stop.”

President Trump said on a Truth Social post that he directed CMS Administrator Dr. Oz to make the rule change. “We are not going to pay for our innocent children to undergo these barbaric surgeries and practices, which result in unthinkable and irreversible harm to their young bodies,” President Trump wrote. “Thanks to our strong position and pressure on this issue over the past year and a half, dozens of U.S. hospitals have already ended this so-called “gender-affirming care,” and we expect many more to follow.”

The battle rages on across the country as states vow to fight against the Trump administration’s mission to halt sex-rejecting or gender-affirming procedures on children. On his first day in office, President Trump signed an executive order to “protect children from chemical and surgical mutilation.” That has included a comprehensive report from HHS and pressure from the administration on hospitals that are providing these treatments for children.

In December 2025, HHS Secretary Kennedy made a formal declaration that puberty blockers, cross-sex hormones, and related surgeries are neither safe nor effective. On the same day, the agency issued the CMS rule that was just finalized and another rule that would change the requirements for participation in Medicare and Medicaid. Specifically, hospitals that provide these sex-rejecting or gender-affirming procedures would not be eligible for Medicare or Medicaid reimbursement. Many of the clinics around the United States rely heavily on these programs to remain in operation and would have to halt their gender clinic practices.

The Kennedy declaration was challenged in court and vacated by a federal judge. The declaration was of no legal consequence, but the plaintiffs and judge argued that the administration was using the declaration to pressure providers into halting their gender clinic practices. Many hospitals and clinics halted the procedures amidst the federal pressure. Children’s Hospital Colorado is currently facing a trial for contempt after refusing to resume sex-rejecting or gender-affirming procedures despite a court order from the Colorado Supreme Court,

The hospital updated its scope to include these procedures, but has argued that affiliated doctors have refrained from writing prescriptions out of fear. The hospital is arguing that it cannot compel doctors to make different professional judgments.

Hospitals and clinics that have halted the prescription of puberty blockers and cross-sex hormones are still providing mental health care. This type of care for gender dysphoria will continue to be covered by Medicaid and CHIP following the latest rule change. Clinics providing mental health care will not be exempted from Medicaid and Medicare if the administration’s proposed rule is finalized in December.

The Diagnostic and Statistical Manual of Mental Disorders, also known as the DSM-5, lists gender dysphoria as a mental disorder defined as “a marked incongruence between one’s experienced/expressed gender and their assigned gender.” It is the only mental disorder in which patients have been treated with drugs that alter the body to match the perception of the individual.

The HighWire has reported on several studies that show transgender surgeries and gender reassignment treatments lead to worsening mental health outcomes. “A 2024 Dutch longitudinal study of the general population found that gender non-concordance was relatively common (21%) in early adolescence but declined significantly by early adulthood, with only a small minority (2%) continuing to report it.”