Apple Health Continues Gender Affirming Care for Minors with State-Only Funding

Effective October 13, 2026, Centers for Medicare & Medicaid (CMS) banned federal funding for certain gender affirming services for minors age 18 and younger. This rule impacts drugs and procedures used to treat clients with a gender dysphoria diagnosis. Apple Health (Medicaid) will continue to cover gender-affirming care for minors age 18 and younger using state-only funding. The care and services that clients receive will not change. The Health Care Authority (HCA) does not anticipate that clients will experience disruptions in care

HCA is changing how it pays for the impacted services to implement the federal rule. The two major changes include:

HCA will no longer seek federal reimbursement for these services.
Managed care organizations (MCO) will no longer be the payer for the impacted gender-affirming drugs and procedures. HCA will now reimburse these services through fee-for-service. HCA already reimburses surgical procedures through fee-for-service. The impacted gender-affirming drugs and procedures will move to the same payment mechanism. HCA is working with MCOs to implement this change effective October 13, 2026.

For Providers: HCA will continue to cover medically necessary gender-affirming procedures and drugs for Apple Health clients age 18 and younger through fee-for-service. HCA covers medically necessary care for clients with a gender dysphoria diagnosis through the client’s MCO, such as mental health care and well-child checkups.

Claims: Providers must submit claims for professionally administered drugs on the Drugs excluded from MCO responsibility list and inpatient procedures for clients age 18 and younger through ProviderOne. Providers must not submit claims to the client’s MCO.

Claims handling varies slightly by claim type. For example, for a client age 18 and younger, providers must submit the entire claim for gender-affirming care delivered in outpatient hospital settings through ProviderOne when the claim includes gender-affirming medication administration.
Refer to the appropriate billing guide for details.
See the Drugs excluded from MCO responsibility list to identify the drugs, prior authorization status, and billable setting.

Prior Authorization: HCA will allow existing MCO prior authorizations if the provider is contracted with HCA. HCA is working with MCOs to obtain client-specific authorization information. Going forward, any required prior authorization must be submitted to HCA. See the Apple Health Preferred Drug List (PDL) for requirements for prior authorization of drugs. HCA currently requires prior authorization for these types of gender-affirming care:

Surgeries, which are rare for minors
Hair removal
Some drugs

Pharmacies: Pharmacies have been notified to bill fee-for-service for drugs affected by this federal rule. Pharmacies should refer to HCA’s fax broadcast, the Prescription drug program billing guide, Drugs excluded from MCO responsibility list, and Apple Health PDL.