NC must offer gender-affirming care to transgender state employees and their family members, court rules

North Carolina can no longer refuse to cover gender-affirming care for state employees or their family members on the State Health Plan, a federal appeals court ruled Monday.

On Monday the U.S. Court of Appeals for the Fourth Circuit ruled that it's unconstitutional for state-run health plans to not cover medically necessary care simply due to someone's gender identity.

The State Health Plan is overseen by State Treasurer Dale Folwell, a Republican who on Monday indicated he'd appeal the loss to the U.S. Supreme Court. Folwell first took office in early 2017 and almost immediately ended the State Health Plan's coverage for gender-affirming care. In his statement Monday he attributed that decision to concerns over costs — an argument the appellate judges explicitly rejected in their ruling.

"The plan is facing the real risk of looming insolvency," Folwell wrote. "Accordingly, the plan cannot be everything for everyone. Our priority is to provide coverage that does the most good for the highest number of people with the finite resources we have available."

The state made similar arguments in court. Monday's ruling said the government can't cite cost concerns as a reason to treat some people differently than others, calling that argument "a non-starter."

The LGBTQ rights group Lambda Legal represented the winning plaintiffs in court.

"Overwhelming research has found that gender-affirming care significantly improves the overall health and well-being of transgender people, both youth and adults," attorney Omar Gonzalez-Pagan told WRAL in a statement. "By contrast, denying access to this care has detrimental effects on the health of trans people, which can include worsening dysphoria, depression, anxiety, and even self-harm. We hope this decision makes it clear to policy makers across the country that health care decisions belong to patients, their families, and their doctors, not to politicians.”

The ruling comes as debates around transgender rights have taken on increased visibility in state and national politics.

Last year North Carolina's Republican-led state legislature passed three new laws on transgender issues — including banning transgender women from playing women's sports, and banning transgender children from receiving certain medical care including hormone therapy and gender-affirming surgery.

Several ongoing lawsuits also target parts of those new laws.

A transgender 9-year-old is suing North Carolina for access to gender-affirming medical care

Monday's 8-6 ruling came after the case was heard by the entire Court of Appeals, not the typical panel of three judges. The ruling split the court along political lines, with Democratic judges making up the majority and Republican judges dissenting.

"The majority misconstrues the challenged policies and steamrolls over the careful distinctions embedded in Equal Protection doctrine," wrote Judge Julius Richardson, a Donald Trump appointee, in the main dissenting opinion. "It finds unlawful discrimination where there is none, stripping the states of their prerogative to create health-insurance and Medicaid systems that serve the best interests of their overall populations."

The case has gone back and forth in court for years and could next go to the U.S. Supreme Court if North Carolina or West Virginia — which was also part of the case — decides to appeal.

The case garnered national attention, with dozens of states filing briefs supporting one side or the other. And the ruling will be enforced not just in North Carolina and West Virginia but in all the other states that make up the federal 4th Circuit: South Carolina, Virginia and Maryland as well.

Folwell, who last month lost the GOP primary for governor against Lt. Gov. Mark Robinson, has presided over a number of major changes to the State Health Plan in addition to ending gender-affirming care coverage.

Earlier this month the plan stopped covering certain weight-loss drugs, which Folwell said are so expensive they would've cost the state well over $100 million a year even with just a small fraction of the plan's members. And last year the plan's board of directors voted to end the state's decades-long relationship with Blue Cross & Blue Shield — a major health insurer Folwell has publicly fueded with for years — and instead give the multibillion-dollar contract to Aetna. That decision has also sparked a legal challenge.