Yesterday I blogged about the just-issued 2006 Corporate Equality Index, published by the Human Rights Campaign. The 68 page report contains much fascinating information. The first thing that catches my eye is the listing on page 7 of the advances in various policy areas. There has been a 64% increase in companies offering at least one transgender wellness benefit. The report notes that 28% of companies offering these offer benefits for surgical procedures. I was surprised at the magnitude of this number.
Many health insurance benefit plans contain an exclusion for costs associated with "transsexualism." Since employers negotiate insurance benefits for their employees, some employers have revisited this issue with the insurer. However, many corporate HR departments are reluctant to provide surgical benefits because they have been told that sex reassignment surgery is cosmetic in nature, and that the costs would be overwhelming.
These exclusions began appearing in insurance contracts in the 1960s, after media publicity about new treatments for transsexuality. There are generally three reasons for the blanket exclusion for transsexualism: the experimental nature of such medical treatments, the belief that such treatments are never medically necessary, and the fear of onerous costs. These reasons, which had some force when the exclusions were first put forward, may now have been superseded by advancements in medical science.
It is important to note that the removal of the blanket exclusion of all treatments for transsexualism will not require coverage of all procedures in aid of sex reassignment. Most insurers limit benefits to those considered medically necessary, and have a blanket exclusion for cosmetic procedures or treatments. Thus, when the exclusion is removed, coverage extends only to those items usually considered medically necessary, i.e., hormone replacement therapy and genital surgery. Facial cosmetic surgery and breast augmentation (though not breast removal) would likely continue to be non-covered expenses, depending on the policy. Some of those employers who currently offer wellness benefits to transgender employees follow this policy.
With regard to hormones and hormone blocking agents prescribed in aid of sex reassignment, most insurers agree that such items are "medically necessary" when prescribed by a physician after a positive consultation with a qualified mental health professional, and are then not considered cosmetic treatments. However, these would clearly be costs associated with transsexualism and therefore excluded.
Many insurance companies now pay for these items despite an exclusion for transsexualism. Hormones and hormone blocking agents are used for many purposes, and if the physician does not specifically mention the diagnosis code for "gender identity disorder," then the insurer will not flag the item. Most transsexuals seek out physicians who are skilled in transgender medicine, and these physicians usually refrain from using the diagnosis code for gender identity disorder in order to protect the privacy of the patient. While some might question the appropriateness of this decision, it is rarely argued that such a decision is outside the bounds of medical ethics.
With regard to surgeries, insurers have been far less willing to admit that such procedures are necessary, even when prescribed by a physician. The weight of medical opinion, however, appears to be that "primary" sex reassignment surgeries are "medically necessary" because studies have shown that the vast majority of individuals who meet the diagnostic criteria of gender identity disorder have cessation of all serious psychiatric symptoms after primary sex reassignment surgery.
Primary sex reassignment surgery differs in natal males and natal females. For natal males, the primary procedure is vaginoplasty. This procedure costs between $10,000 and $25,000. The main variable of cost is the surgeon's fee. For natal females, the primary procedure is mastectomy, the removal of the breasts. This procedure costs between $3000 and $7500. Phalloplasty is an option not often chosen because of lack of function and nerve sensation. It is also more expensive, costing between $20,000 and $50,000. For these reasons, many female-to-male transsexuals do not obtain phalloplasty, nor do they consider it necessary for gender transition.
Dr. M A. Horton, an expert who has researched the issue of increased insurance premiums for SRS (sex reassignment surgery), has estimated that the increased cost for coverage of primary SRS in the US would be about $0.11 per insured. Dr. Horton has also reported the results of large employers that have extended coverage for primary SRS, showing the costs to be lower than expected. Her report is available at http://www.tgender.net/taw/
On a lexicographic note, some people refer to these surgeries as "gender reassignment surgery." Because it is my opinion that gender is not based on physical attributes, I do not believe that surgery changes gender. Rather, it reassigns "sex," which is the complex of physical, psychological, behavioral and social attributes we call "male" and "female."