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A federal judge in Washington state ruled on Dec. 19 that Blue Cross Blue Shield of Illinois discriminated against transgender individuals by denying coverage for medically necessary gender-affirming care in its administration of employer-provided ERISA health plans.
"Blue Cross, as a third party administrator, is a covered entity under Section 1557 and has discriminated against the plaintiffs and the class plaintiffs by denying them services for gender affirming care under individual and class plaintiffs' insurance policies," the judge writes.
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Any appropriate relief will be awarded by motion practice or at trial.
In November, the court had granted a class action against BCBS that accused the payer of denying gender-affirming care coverage under a self-funded health plan, thereby violating the anti-discrimination provision (Section 1557) of the ACA.
In the decision, the judge certified the class action to represent up to 1,740 people who are covered under self-funded plans and who were or could still be denied transgender care coverage.
The original lawsuit was filed in 2020 by a transgender teenager and his mother, who were provided health coverage through her employer, which is St. Michael Medical Center in Bremerton, Wash., a part of CommonSpirit Health. The plan was administered by BCBS and included a transgender care exclusion clause. BCBS says 95% of the 398 self-funded plans it administers includes the same clause.
"The court's decision not only establishes that categorical exclusions for coverage of gender-affirming care are unlawful discrimination, but it also concludes that health insurers who receive federal funds and act as third-party administrators have an independent duty to not administer discriminatory ERISA health plans," the plaintiff's counsel writes in a news release.
"This is a victory not only for [the plaintiff] and his parents, but also for the hundreds of transgender people who were, are, or were likely to be denied medically necessary gender-affirming care because of BCBSIL's administration of approximately 400 ERISA health plans with these unlawful exclusions. The court's decision sends a clear message that third-party administrators that accept federal funds cannot discriminate when administering employer-sponsored health plans."
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