Medicaid is a U.S. health care program jointly funded by the federal and state governments to assist citizens with limited incomes. Most of the treatments and procedures covered by Medicaid are well-established, but some fall on the judgment of the Medicaid officials representing each state. One operation with a history of controversy and inconsistency concerning Medicaid coverage is sexual reassignment surgery.
Sexual reassignment surgery is an operation designed to treat gender identity disorder, the formal term for people with gender dysphoria, a strong discontent with the biological sex of their birth. The surgery consists of several operations that physically alter defining gender features to that of the opposite, preferred sex. In most cases, male-to-female patients undergo castration, a penectomy and vulva-vaginal construction. In many cases, a female-to-male undergoes a bilateral mammectomy, hysterectomy, removal of fallopian tubes and sometimes implantation of testicular prostheses.
Before 2001, Medicaid had been conducting assessments and treatments of gender identity disorder through the Harry Benjamin International Gender Dysphoria Association. Assessments and treatments included gradual introduction of hormone treatment and subjects living as the opposite sex for a year before surgical reassignment. State Medicaid officials made individual decisions based on applications for care.
Medicaid reports that the organization has covered only five full sexual reassignments during 1992 to 2009, the most recent two in 2000. Washington state’s Auditors Office published a 2004 record stating Medicaid had spent $180,000 in taxpayer dollars the previous year on “questionable sex-related or cosmetic surgeries.” Soon after the report was published, the state banned sexual reassignment surgery. In 2007, Medicaid approved two people for reassignment coverage but that was later reversed by the state government officials in hearings.
Opponents of reassignment coverage cite concerns of safety and necessity. Proponents claim the use of phrases such as “medical necessity” in the Medicaid literature and “experimental” in findings published about reassignment surgery are misappropriated. When Medicaid switched tactics in 2001, it commissioned a report on the surgery from heath care technology assessment firm Hayes Inc. that concluded there was not enough evidence to determine that surgery was safer and more effective than a combination of hormone and counseling therapy. Harry Benjamin employees stated that the reports Hayes personnel studied and deemed “experimental” were written early on in the surgery's history. They also indicated on average that post-operational patients showed improved mental health.
Although Medicaid has covered gender reassignment surgery in the past, the Medicaid website stated as of October 2009 that Medicaid does not cover any procedures or treatments, including hormone therapy, related to sexual reassignment unless they are necessary for the patient's survival. The website states that because of a “lack of well controlled, long term studies of the safety and effectiveness…there is a high rate of serious complications for these surgical procedures. For these reasons, transsexual surgery is not covered.”