A strong conviction that one has the typical feelings and reactions of the other gender (or some alternative gender different from one’s assigned gender)
The condition is associated with clinically significant distress or impairment in social, occupational, or other important areas of functioning.
Source: American Psychiatric Association Diagnostic and Statistical Manual of Mental Disorders (5th ed.)

Chief Judge Robert L. Gregory said some people not being interested in services to which they should have access doesn’t make sense as an explanation for eliminating the whole group’s access.

“That’s like saying, “‘We have facial discrimination against Blacks,’” said Gregory, who is Black. “‘But it’s okay because there are some Black people who don’t care about going to a restaurant at all, others who do.’

“We don’t look at that, their choices, whether there are some transgender people who don’t need these services,” Gregory said. “You cut that off categorically.”

The three judge panel:

• Chief Judge Roger L. Gregory
  • Nominated by: Presidents Bill Clinton (recess appointment) and George W. Bush
  • Confirmed by the Senate: 2001
• Judge Steven Agee
  • Nominated by: President George W. Bush
  • Confirmed by the Senate: May 20, 2008
• Judge Albert Diaz
  • Nominated by: President Barack Obama
  • Confirmed by the Senate: December 18, 2010

Gregory was a recess appointment of former President Bill Clinton who was later nominated to the same position by former President George W. Bush. Throughout last week’s oral arguments, he expressed strong skepticism of the state health plan’s exclusion. At times he clashed with Knepper, at one point chiding him for shaking his head while the judge was attempting to make a point.

Judge Steven Agee, who was also a nominee of former President George W. Bush, was more sympathetic to Knepper’s positions throughout the oral arguments. He firmly questioned Tara Borelli, senior counsel at Lambda Legal, during her argument for the plaintiffs, but without apparent tension.

Judge Albert Diaz, a nominee of former President Barack Obama, was relatively quiet throughout last week’s arguments as Gregory and Agee dominated the back and forth with the opposing attorneys.

“What they’re asking this court to do is to pick up its judicial pen and rescue this exclusion by rewriting it,” Borelli told the three judge panel. “Because the one they’ve adopted, and the one that they actually have to defend, is so indefensible. It so plainly and clearly discriminates based on sex and transgender status.”

A fraught history and the road ahead

North Carolina was one of a number of states that began covering medically necessary treatment for transgender people in 2017 to comply with federal non-discrimination laws. That includes everything from talk-therapy related to gender transition to hormone therapy and some surgeries.

But when Folwell came to office, he dismissed that coverage as unnecessary, too expensive and out of step with his primary goal of cutting costs. He and the State Health Plan’s board of trustees let the extension of coverage for transgender treatment lapse. In the face of criticism and lawsuits, Folwell defended the exemption.

“Until the court system, a legislative body or voters tell us that we ‘have to,’ ‘when to,’ and ‘how to’ spend taxpayers’ money on sex change operations, I will not make a decision that has the potential to discriminate against those who desire other currently uncovered elective, non-emergency procedures,” Folwell told Policy Watch in 2018.

“Sex change operation” is not a term used by medical professionals treating transgender people, insurance companies or the LGBTQ community. It is widely considered offensive both because of its technical inaccuracy and because a wide array of procedures—not just one operation—are utilized in gender transition.

Knepper and Borelli, in debating the exclusion before the appeals court panel last week, repeatedly apologized for having to use the term — and related terms — when quoting writings and opinions on the subject from years ago.

Last year, when U.S. District Judge Loretta Biggs ruled against the plan’s exclusion, Folwell’s office restored the coverage, but also moved immediately to appeal the decision.

Policy Watch has reached out to Folwell for comment on the appeal, but calls were not returned.

As Biggs wrote in her ruling last year, a key point in the case is whether excluding treatments related to gender dysphoria necessarily discriminates against transgender people.

“On its face, the Exclusion bars coverage for ‘treatment in conjunction with proposed gender transformation’ and ‘sex changes or modifications,’” Biggs wrote.”The characteristics of sex and gender are directly implicated; it is impossible to refer to the Exclusion without referring to them.”

“State Defendants attempt to frame the Exclusion as one focused on “medical diagnoses, not … gender.” (ECF No. 37 at 6.),” Biggs wrote. “However, the diagnosis at issue—gender dysphoria—only results from a discrepancy between assigned sex and gender identity. Cf. McWright v. Alexander, 982 F.2d 222, 228 (7th Cir. 1992) (‘[A]n employer cannot be permitted to use a technically neutral classification as a proxy to evade the prohibition of intentional discrimination,” such as ‘gray hair as a proxy for age.’). In short, the Exclusion facially discriminates on the basis of gender, and heightened scrutiny applies.”

How best to treat gender dysphoria — or even to discuss it — remains a debate even within the LGBTQ community. Its more nuanced definition as a diagnosis in the fifth edition of the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders (DSM-5) was seen as a step forward as compared to transgender identity itself being considered a disorder. Its definition has also gone a long way toward helping transgender people access medical care and legal recognition they’ve long sought.

In many ways, transgender identity has mirrored the path of homosexuality in terms of mainstream and medical acceptance. When the first edition of the DSM was published in 1952, homosexuality was included as a psychological disorder. With further study and debate, that was changed in 1974 to a diagnosis for those distressed by their homosexuality. By 2013 that too was removed.

Many LGBTQ advocates say they look forward to a day when transgender identity is so widely accepted that a medical diagnosis is no longer part of their fight for medical care and legal rights. But for now, political debates and legal fights over who is transgender, how they should be treated when experiencing dysphoria and whether and how they can legally change their legal gender continue.

Last year transgender people born in North Carolina prevailed in a lawsuit over changing the gender marker on their birth certificates without being required to medically transition.

It isn’t clear when the appeals court will make its decision on the State Health Plan. But Borelli, the attorney for the plaintiffs, told Policy Watch she believes the original district court opinion will hold up.

“That is the trend we are seeing across the country on these sorts of exclusions,” Borelli said. “The courts continue to make clear that they are discriminatory.”