Gender-Affirming Care for Minors: CMS and HHS Propose Limits on “Sex Rejection Procedures” and Expanded Enforcement Pathways

On December 18, 2025, the U.S. Department of Health and Human Services (HHS) held a press conference focused on what is defined as “sex rejection procedures” (SRPs), which is also known as gender-affirming care (GAC) for minors, and outlined next steps. During the press conference, HHS announced the publication of a Declaration on the Safety, Effectiveness and Professional Standards of SRPs, the publication of two new proposed rules, and announced that the U.S. Food and Drug Administration (FDA) had issued twelve warning letters to manufacturers of breast binders for deceptive advertisement to children. 

Taken together, these publications and warning letters put the future of GAC at a crossroads. As noted below, the Secretary of HHS concluded that SRPs are neither safe nor effective as a treatment modality for gender dysphoria, gender incongruence, or other related disorders in minors and therefore fail to meet professional recognized standards of health care. Based on this conclusion, HHS proposed or identified certain enforcement pathways that raise the risks for providers of GAC services and will limit access to such services, including limits on federal Medicaid funding, new conditions of participation for hospitals that could result in findings of survey deficiencies, and even exclusion of individuals and entities from participation in the federal health care programs.   

Stakeholders may respond to the notice and comment period that was announced for the two proposed rules within the sixty (60) days following publication in the Federal Register. 

HHS’s Declaration on the Safety, Effectiveness and Professional Standards of SRP

The Secretary of HHS, Robert F. Kennedy Jr., issued a formal declaration titled “Safety, Effectiveness, and Professional Standards of Care for Sex-Rejecting Procedures on Children and Adolescents” (Declaration). The Declaration included a detailed history of the rising prevalence of gender dysphoria in youth, noted the expansion of medical interventions, and raised concerns about the adequacy and evidentiary basis of clinical guidelines issued by prominent medical organizations, including the Endocrine Society, the World Professional Association for Transgender Health (WPATH), the American Medical Association, and the American Academy of Pediatrics. 

Specifically, the Declaration questioned whether the standards currently in place sufficiently address the safety, long-term outcomes, and appropriate professional protocols for performing SRPs on minors. In the Declaration, the Secretary of HHS concluded that SRPs are neither safe nor effective as a treatment modality for gender dysphoria, gender incongruence, or other related disorders in minors and therefore fail to meet professional recognized standards of health care. 

After this statement, the Declaration notes that the Secretary may exclude individuals or entities from participating in federal health care programs if the Secretary determines that services fail to meet professionally recognized standards of health care. This threat significantly raises the risks for any entity engaged in providing SRPs. Moreover, the threat to hospital provider agreements due to a hospital’s failure to meet conditions of participation as identified in a survey further discussed below, heightens the risk of offering these services as well. 

CMS Proposed Rules

• The first proposed rule, titled “Prohibition on Federal Medicaid and Children’s Health Insurance Program Funding for Sex-Rejecting Procedures Furnished to Children,” would significantly alter Medicaid and Children’s Health Insurance Program (CHIP) coverage rules for certain medical procedures provided to individuals under 18 or, in the case of CHIP, under 19 (Medicaid Proposed Rule).
• The second proposed rule, titled “Hospital Condition of Participation: Prohibiting Sex-Rejecting Procedures for Children,” would prohibit Medicare- and Medicaid-participating hospitals from performing SRPs on minors with narrow exceptions (CoPs Proposed Rule). These rules are part of a broader initiative by the Trump administration, following Executive Order 14187 (Protecting Children from Chemical and Surgical Mutilation), signed by President Trump in January 2025.

Key Provisions of the Medicaid Proposed Rule

1. Prohibition on Federal Funding for “Sex-Rejecting Procedures” in Medicaid and CHIP
The Centers for Medicare & Medicaid Services (CMS) proposes creating new subsections in 42 C.F.R. Part 441 (Medicaid) and Part 457 (CHIP) to prohibit Federal Financial Participation (FFP) or federal matching funds for “Sex-Rejecting procedures,” also known as gender-affirming care for minors. Notably, in the preamble, CMS states that this proposed rule would not prevent states from providing coverage for SRPs with state-only funds outside of the federally matched Medicaid program or CHIP.

2. Scope of “Sex-Rejecting Procedures”
The rule defines SRPs procedures as pharmaceutical or surgical interventions intended to align a child’s body or physical appearance with an asserted gender identity that differs from an individual’s assigned sex, where that procedure involves:

• Disrupting or suppressing normal development of sex-based traits (primary or secondary); or

• Altering physical characteristics, including removal or modification of sex-based anatomical structures.

The Medicaid Proposed Rule also codifies the definitions of several different terms including male and female.

3. Notable Exemptions
The prohibition would not apply to procedures undertaken:

• To treat a medically verifiable disorder of sexual development;
• For purposes unrelated to changing alignment of sex and gender identity; or
• To address complications caused by prior procedures.

4. Psychotherapy Services Remain Fundable
CMS emphasizes that providers may be paid through Medicaid and CHIP for “providing other types of care for individuals diagnosed with gender dysphoria.” CMS specifically notes that mental health counseling and psychotherapy for gender dysphoria could still be covered by Medicaid and CHIP including through the mandatory Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) provisions in section 1905(r) of the Social Security Act and 42 U.S.C. § 1396d(r). In justifying this distinction, CMS noted that it is consistent with a growing international trend to prioritize non-invasive mental health interventions as the first line of treatment for children and adolescents experiencing gender dysphoria. Through this approach, CMS says it seeks to protect minors from the risks and uncertain benefits of what they consider experimental medical or surgical procedures while preserving access to non‑invasive, evidence‑based care.

Key Provisions of the CoP Proposed Rule

1. Prohibited Conduct: Hospitals could not perform SRPs — defined to include pharmaceutical or surgical interventions intended to align a child’s body with a stated identity that differs from their biological sex — on anyone under 18. The CoP’s Proposed Rule does not address whether other services for the treatment of gender dysphoria are permitted. This silence is notable because the Medicaid Proposed Rule specifically noted Medicaid and CHIP funding may pay for these services, though it is a reasonable interpretation that the same concepts set out in the Medicaid rule would apply to the CoP Proposed Rule. The CoP Proposed Rule by its terms would prohibit pharmaceutical or surgical interventions, but nothing more.  

2. Exceptions: Certain carve-outs exist for:

• Treating medically verifiable disorders of sex development;
• Treating physical injuries, illnesses, or disorders unrelated to changing the child’s sex-based appearance; or
• Treating complications caused by previous SRPs.

3. Scope: The rule would apply to all Medicare- and Medicaid-participating hospitals across the country regardless of whether a particular patient’s care is funded by these programs. In other words, hospitals could not perform SRPs for minors who are commercially insured or have families willing to pay privately for such services. Because most hospitals rely on federal program participation, the practical reach of the rule is nationwide, leaving only non-participating hospitals outside CMS oversight unaffected (an extremely small percentage of facilities). Although the rule has a broad impact, it does not apply to such providers as individual practitioners if they see patients independent of a hospital, ambulatory surgery centers or other entities. In fact, the CoP Proposed Rule explicitly states that primary care providers and endocrinologists outside of hospitals would not be affected by these requirements and can continue to prescribe these treatments.

4. Definitions: The rule includes explicit definitions for “child,” “male,” “female,” and “sex,” anchoring them in biological terms.

How CMS Addresses the Prohibition on Regulating Medical Practice

CMS directly addresses the statutory limitation in Section 1801 of the Social Security Act (42 U.S.C. § 1395), which bars the agency from exercising supervision or control over the practice of medicine. In the preamble to the proposed rule, CMS argues that providing SRPs to minors is not “healthcare” within the meaning of that provision, and therefore the prohibition does not intrude on medical practice. The agency frames SRPs as interventions that intentionally destroy healthy biological functions versus treatments aimed at restoring or preserving health. Because CoPs are designed to protect patient safety, CMS asserts it may condition participation in Medicare and Medicaid on the absence of such harmful, non‑restorative interventions without dictating legitimate medical judgment. 

Federal Preemption and Interaction with State Law

CMS states outright that these federal CoPs would override:

• State laws that require hospitals to provide SRPs to minors; and
• State laws that allow exceptions broader than those in the federal rule.

In summary, if finalized, this proposed rule would limit the type of care hospitals could offer regardless of local legal protections or “shield laws” in place for gender-affirming care – or risk losing their Medicare/Medicaid provider agreements.

Conclusión 

HHS actions represent the latest in a series of steps by the Trump administration that could affect access to gender-affirming care. With CMS opening a sixty-day public comment period on both proposed rules, stakeholders have a defined – but time limited – opportunity to offer input that may influence the final regulatory language. Health care providers, state agencies, and advocacy organizations may wish to submit comments to ensure their perspectives are considered. There is no formal public comment period on the Declaration and threat of program exclusion, nor does it indicate any delayed application. As the policy environment continues to shift, stakeholders across the spectrum should continue monitoring developments closely for any further administrative actions that could shape the future of gender-affirming care in the United States.

En Foley, asesoramos activamente a proveedores de todo el país sobre cómo responder a este panorama legal en constante evolución. Desde el desarrollo de políticas y estrategias de cumplimiento hasta la defensa en materia de aplicación de la ley, estamos aquí para ayudar. Si tiene alguna pregunta, póngase en contacto con los autores, su socio de Foley o nuestroGrupo de Práctica de Atención Médicayel Sector de Atención Médica y Ciencias de la Vida.