In an outstanding opinion yesterday in Anderson v. Crouch, a Fourth Circuit panel ruled that West Virginia’s exclusion of “sex change” surgeries from its Medicaid coverage does not violate either the Equal Protection Clause or the Title IX standard incorporated into section 1557 of the so-called Affordable Care Act. The section 1557 holding is noteworthy because the panel was bound by circuit precedent to apply Bostock yet had no difficulty rejecting the claim of sex discrimination.
Judge Julius Richardson wrote the opinion, which Judge Paul Niemeyer and Judge Allison Jones Rushing joined. (Donald Trump appointed Richardson and Rushing; George H.W. Bush appointed Niemeyer.)
Here is a summary of the ruling (in the voice of the panel):
1. West Virginia denies Medicaid coverage of surgical treatments for gender dysphoria. (It allows other treatments for gender dysphoria, such as therapy and hormones.) Our en banc court ruled that West Virginia violated the Equal Protection Clause and section 1557. But the Supreme Court vacated our judgment and directed us to reconsider the matter in light of its 2025 ruling in United States v. Skrmetti. Our court then referred the case to this panel.
Plaintiffs’ claims under the Equal Protection Clause and section 1557 fail in light of Skrmetti:
On Equal Protection: Plaintiffs fail to show that the exclusion discriminates because of sex or transgender status. (We need not address whether discrimination based on transgender status merits intermediate scrutiny because the exclusion does not discriminate on that basis.) The exclusion classifies based on medical diagnosis and applies evenhandedly to everyone. West Virginia’s Medicaid program does not cover certain medical services if a patient seeks the service as treatment for gender dysphoria. But if the patient seeks the same service for a different, qualifying diagnosis, West Virginia covers it—regardless of sex or transgender status. Skrmetti forecloses the argument that the exclusion really classifies based on transgender identity.
West Virginia’s plan does not provide unequal access to medical treatments based on sex or transgender status. For every medical service, the State has established a list of diagnoses that qualify someone for that service. West Virginia chose to cover alterations of a person’s breasts or genitalia only if the person experiences physical injury, disease, or congenital absence of genitalia. Anyone who has a diagnosis of this kind can receive coverage for such medical services, regardless of that person’s sex or transgender status.
West Virginia has put forth legitimate, nondiscriminatory reasons for denying coverage for certain gender-dysphoria treatments, including cost and efficacy concerns. It therefore cannot be said that the plan obviously uses gender dysphoria to discriminate by proxy against transgender persons. For the same reasons, the exclusion passes rational-basis review.
On section 1557: Section 1557 provides that an individual shall not be discriminated against in the provision of health benefits on any ground prohibited under Title IX. Title IX prohibits discrimination “on the basis of sex.”
We are bound by Fourth Circuit precedent that holds that the Supreme Court’s Bostock approach to sex discrimination in Title VII extends to Title IX. Applying Bostock’s “traditional but-for causation standard,” we find that the exclusion does not violate section 1557. The exclusion applies irrespective of sex or transgender status.
2. Some observations:
a. The panel also ruled that plaintiffs lacked a cause of action under the Medicaid Act.
b. Liberal judges on the Fourth Circuit have been wild in their embrace of transgender legal claims. And I’d be shocked if they don’t suffer a smashing defeat in the pending Supreme Court case (West Virginia v. B.P.J.) on West Virginia’s law that preserves girls’ and women’s sports teams for girls and women.
West Virginia obviously had a strong panel draw in this case. Will Fourth Circuit liberals try to take this case en banc? I’d be very surprised. I think that they should instead be grateful that the conservative panel spared them the discomfort of having to acknowledge themselves what Skrmetti means.
c. Those of you deep into this matter might wonder what happened to the companion case of Kadel v. Folwell. The short answer is that on remand from Skrmetti the Kadel case was further remanded to the district court. Yesterday’s panel ruling should dictate the same result in Kadel.