Blue Cross Blue Shield of Illinois Can't Exclude Gender-Affirming Care: Court

Blue Cross Blue Shield of Illinois may not exclude gender-affirming care from any health insurance plan it administers anywhere in the U.S., a federal judge in Washington State ruled Wednesday.

This includes plans that are self-funded by employers and for which BCBS of Illinois serves as a third-party administrator. The ruling “is the first in the country to order a third-party administrator, like BCBSIL, to refrain from administering discriminatory exclusions at the behest of employers,” says a press release from Lambda Legal, which represented transgender insurance beneficiaries in the class action suit. “Millions of Americans receive their health coverage in self-funded plans that are managed by third-party administrators which are also subject to anti-discrimination laws.” There is no exception for faith-based employers.

Lambda Legal and the law firm of Sirianni Youtz Spoonemore Hamburger PLLC filed the suit in November 2020 in U.S. District Court for the Western District of Washington in Tacoma. It alleged that the insurer’s administration of exclusions of gender-affirming care violated the health nondiscrimination law enacted as part of the Affordable Care Act, known as Section 1557.

The court ruled in December 2022 that BCBS of Illinois had indeed violated Section 1557 by committing anti-trans discrimination in enforcing those exclusions, even in self-funded plans that may be designed by employers. But it continued to enforce them, so the trans beneficiaries’ lawyers asked the court for a permanent injunction against the enforcement and reprocessing of the claims that had been denied. Judge Robert J. Bryan agreed.

“Reprocessing appears to be the only fair relief to counter the Defendants’ erroneous denial of retrospective class’s claims because of sex discrimination,” he wrote. The insurance company had asked that Bryan’s ruling be put on hold pending appeal, but he denied that request because, he said, an appeal has not been filed and is unlikely to succeed, while “class members will be substantially injured if they are unable to get needed medical care.”

“With this decision, the court made clear not only that Blue Cross Blue Shield of Illinois must not administer any categorical exclusions of coverage for gender-affirming medical care in the future, but that it must reprocess all the claims that it unlawfully denied when it administered the exclusions against class members,” Omar Gonzalez-Pagan, counsel and health care strategist for Lambda Legal, said in the press release. “Thousands of transgender people in BCBSIL-administered health plans will have access to the health care they need.”

“BCBSIL is not unique,” added Eleanor Hamburger of Sirianni Youtz Spoonemore Hamburger. “Other health insurers and third-party administrators implement the same discriminatory exclusion with impunity. This decision sends a warning that they should heed: Health companies governed by the Affordable Care Act cannot engage in discrimination, even when asked to do so by an employer.”

“My family has waited for this day for years,” said Pattie Pritchard, mother of trans man C.P., one of the original plaintiffs in the case. “We are thrilled that BCBSIL has been told, definitively, that it cannot discriminate against my son or anyone else just because they are transgender. I hope that other health companies also get the message sent by the court’s order. No one should be denied needed medical care because of their sex.”