Regulatory NewsBREAK: CMS Issues Final Rule on Gender Affirming Care

On August 11, 2026, the Centers for Medicare and Medicaid Services issues a final rule titled, “Prohibition on Federal Medicaid and Children’s Health Insurance Program Funding for Sex-Rejecting Procedures Furnished to Children” (Final Rule).

The Final Rule prohibits payments to State Medicaid plans for “sex-rejecting procedures” for children under 18 or to a separate Children’s Health Insurance Program (CHIP) for children under 19. Among the definitions included in the Final Rule are:

• Sex means a person's immutable biological classification as either male or female.
• Sex-rejecting procedures means any pharmaceutical or surgical intervention that attempts to align an individual’s physical appearance or body with an asserted identity that differs from the individual’s sex by either of the following: 
  • Intentionally disrupting or suppressing the normal development of natural biological functions, including primary or secondary sex-based traits; or
  • Intentionally altering an individual’s physical appearance or body, including amputating, minimizing or destroying primary or secondary sex-based traits such as the sexual and reproductive organs. 
• The Final Rule excludes procedures undertaken to (a) treat medically verifiable sexual development disorders, (b) for purposes other than attempting to align an individual’s physical appearance or body with an asserted identity that differs from the individual’s sex, and (c) to treat complications caused by or exacerbated by the performance of sex-rejecting procedure(s).

For Medicaid and CHIP beneficiaries who are actively receiving cross-sex hormone therapy, State Medicaid and CHIP agencies may continue to claim Federal Financial Participation for those hormone therapy medications for a period of up to 6 months from the effective date of this final rule.

Effective October 13, 2026.

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For questions, please reach out to Geni Tunstall.