August 21, 2026 Newswires

New Mexico to continue funding gender-affirming care for minors as Medicaid ends coverage

Lily Alexander, The Santa Fe New MexicanThe Santa Fe New Mexican

New Mexico plans to fill the financial gap for gender-affirming care for minors after a federal rule barring that use for Medicaid funds is finalized.

The Centers for Medicare and Medicaid Services and the U.S. Department of Health and Human Services last week issued the final rule, which also prevents state Children's Health Insurance Programs from covering care for transgender and gender-nonconforming youth under age 19. The rule will go into effect Oct. 13, although patients on hormone-replacement therapy will be able to receive federal coverage for an additional six months.

States also may continue to fund the gender-affirming care on their own, New Mexico Health Care Authority spokesperson Timothy Fowler wrote in an email.

"The Health Care Authority is planning to continue covering these services using state funds," he wrote.

New Mexico's Medicaid program — known as Turquoise Care — currently covers medications, but not surgical procedures, for transgender and gender-nonconforming people under age 18.

The final rule "prevents the use of federal funds for gender-affirming care services" for Medicaid members who are minors, Fowler wrote.

Specifically, federal funds cannot be used for surgeries and medications like puberty blockers — used to pause puberty by temporarily preventing the body from producing testosterone or estrogen — and hormones.

Adrien Lawyer, executive director and co-founder of the Transgender Resource Center of New Mexico, said he is most concerned about the rule's impact on young people's access to puberty blockers, which can become prohibitively expensive without insurance.

"Puberty blockers are thousands and thousands of dollars per dose," Lawyer said. "So if those things aren't being covered by insurance, they just become completely inaccessible."

The annual cost of puberty blockers ranges from $4,000 to $25,000 without insurance, according to a 2020 article published in Pediatrics, the official journal of the American Academy of Pediatrics.

Some insurance plans no longer cover the medications, which Lawyer said feels like a return to the past.

"Getting those things covered by insurance was a huge victory in our community," he said. "That's why it hits for people so badly when they're like, 'We're going to take it away again.' That makes such a big difference for the kids."

It is unclear how many young trans people in New Mexico rely on Medicaid. But 287,397 children were enrolled in the state's Medicaid and CHIP programs in July, according to a Health Care Authority report.

The Williams Institute at the University of California, Los Angeles, law school estimates there are 4,800 trans youth ages 13 to 17 living in New Mexico.

The New Mexico Office of the Superintendent of Insurance issued guidance in 2018 stating the exclusion of coverage for "gender dysphoria care" violated the state Insurance Code.

Other recent changes

The rule is the latest in a slew of federal moves targeting the funding mechanisms for gender-affirming care — particularly for youth.

In 2025, the U.S. Office of Personnel Management announced Federal Employee Health Benefits and Postal Service Health Benefits programs would no longer cover gender-affirming care — except for counseling services — for people of all ages. Earlier this month, five anonymous federal workers filed a class action lawsuit in D.C. federal court over the change, arguing it constituted discrimination on the basis of sex.

One plaintiff in the suit is the parent of a trans daughter who will have to deplete his family's savings to meet her medical needs, according to the class action complaint.

Lawyer noted the Transgender Resource Center serves the families of a few federal workers who have been impacted by the coverage shift.

"They were the first ones to lose it; they lost it for real already," Lawyer said. "So that's been rough, helping them and trying to be helpful to them because this isn't theoretical. It's already gone."

In New Mexico, Blue Cross Blue Shield of New Mexico and UnitedHealthcare insurance plans offered through the state’s BeWell marketplace started to block coverage earlier this year for so-called "sex-trait modification" procedures. It's similar to the language used by the federal government in its rules and executive orders, which refer to gender-affirming care as "sex-rejecting procedures."

This terminology is misleading, Lawyer said. Trans and gender-nonconforming people under age 18 rarely undergo surgical procedures.

"You think about your average voter ... and how much information they have access to about trans people. How much education have they ever had, or exposure? Do they even know if they know a trans person?" Lawyer said. "And then you're hearing this 'sex-rejecting procedure' for children and it just immediately throws you onto one side of this conversation."