ANALYSIS: Gender Care Coverage Could Get a Bostock Boost in 2024

Federal judges in 2024 are likely to strike down laws that exclude gender-affirming care from Medicaid coverage in a battle that will strengthen and expand the US Supreme Court’s precedent in Bostock v. Clay County to sex discrimination beyond the employment arena.

Oral arguments were heard on Sept. 21 for two key cases before the US Court of Appeals for the Fourth Circuit that ask whether state laws violate the equal protection clause of the 14th Amendment by banning Medicaid from covering treatment that aims to support a person’s gender identity when it is different than assigned at birth. The cases are poised to wind up at the Supreme Court, and will ultimately hinge on either a narrow or broad interpretation of Bostock—the 2020 ruling that held that gender identity discrimination in employment amounts to sex discrimination under Title VII of the Civil Rights Act of 1964.

Laws targeting or affirming transgender rights across the US are varied and inconsistent, especially when it comes to health care. A decision in the Fourth Circuit could have widespread implications on many other cases involving transgender rights, particularly if they ultimately go up to the Supreme Court.

Bostock in Lower Courts

The cases, Kadel v. Folwell and Fain v. Crouch, ask whether two health insurance plans—a North Carolina employee health plan and West Virginia’s state Medicaid program—unlawfully discriminate against participants and dependents by excluding payment for some transgender-related health care. The plaintiffs’ primary claim is that the exclusion violates the equal protection clause.

The cases were consolidated to be heard en banc in April, and oral arguments took place Sep. 21. The court has yet to release a decision.

The overarching question in these and similar cases is whether the Bostock ruling is too narrow to apply to health care or other situations outside the employment context. States defending their Medicaid coverage bans argue that the equal protection clause is distinguishable from Title VII, and that Bostock was not meant to be applied to it. But the lower courts in the cases have opted to apply Bostock more broadly.

In Kadel, for example, the federal district court heavily relied on Bostock in finding that North Carolina’s exclusions of gender-affirming care “facially discriminate based on sex and transgender status.” Specifically, the court cited a hypothetical used in Bostock, where an employer asks a job applicant to check a box if they are “homosexual or transgender.”

The Supreme Court said in the Bostock hypothetical that although “the resulting applications would disclose which individuals are homosexual or transgender without revealing whether they also happen to be men or women,” there is “no way for an applicant to decide whether to check the homosexual or transgender box without considering sex.” The lower court in Kadel held that the same was true for plan administrators.

Circuit courts have applied Bostock in other transgender cases outside of the employment context. In 2020, for example, the Fourth Circuit used Bostock to hold that gender identity was protected under a prohibition on the discrimination on the basis of sex in schools under Title IX of Education Amendments of 1972.

In March 2022, the Ninth Circuit found the lower court’s “understanding of Bostock was too narrow” and held that application of Bostock does not solely apply to Title VII and employment. This case, Doe v. Snyder, is particularly pertinent because it also involved Medicaid coverage of a gender-affirming procedure for two transgender minors.

Supreme Court Hints at Bostock Expansion

The central argument to a narrow reading of Bostock’s protections is that the Supreme Court did not specify if the ruling applied outside of employment and Title VII.

“The employers worry that our decision will sweep beyond Title VII to other federal or state laws that prohibit sex discrimination,” Justice Neil Gorsuch wrote for the majority in Bostock. “But none of these other laws are before us; we have not had the benefit of adversarial testing about the meaning of their terms, and we do not prejudge any such question today.”

Looking at this statement, it could easily be interpreted that the Supreme Court did not intend for its ruling to have a broader application. That’s not to say the same kind of reasoning would be impossible to employ in other cases, but rather that Bostock wasn’t meant to be persuasive in those cases.

However, part of a recent Supreme Court case—one that has nothing to do with sex discrimination—hints that the justices might read Bostock differently if they get to decide on the issue.

In SFFA v. Harvard, the Supreme Court ruled in June that using race as a factor in college admissions violated the equal protection clause. In his concurrence, Justice Gorsuch also emphasized that it violates Title VI of the Civil Rights Act. Gorsuch noted similarities between this case and Bostock with regard to equal protection and Title VI and Title VII, respectively. He particularly noted that “this Court has long recognized, too, that when Congress uses the same terms in the same statute, ‘we should presume they have the same meaning.’”

Because SFFA was primarily looking at the equal protection clause in making its ruling, Gorsuch’s comments point to potential precedent for how the Supreme Court may decide on sex discrimination under that same clause.

The equal protection clause is part of a constitutional amendment, not a “statute.” But given how the court or Justice Gorsuch, at least, looked at the relations between Title VI and Title VII in SFFA, and acknowledged the analogous relationship between the equal protection clause and Title VI, it is impossible not to see the natural progression to a connection in meaning between the Equal protection Clause and Title VII.

A decision finding that Bostock’s coverage extends to the equal protection clause would be a boon for transgender people in Medicaid coverage and would provide both consistency and precedent for other gender-affirming care cases making their way through the judicial system. In addition, it would provide new precedent and leverage for lawyers representing clients in sex discrimination cases across multiple spheres if it was found Bostock held wider significance.

Access additional analyses from our Bloomberg Law 2024 series here, covering trends in Litigation, Transactions & Contracts, Artificial Intelligence, Regulatory & Compliance, and the Practice of Law.

Bloomberg Law subscribers can find related content on our In Focus: Gender Identity Discrimination page.

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