Patient Protection and Affordable Care Act; Marketplace Integrity and Affordability

1. Prohibition on Coverage of Specified Sex-Trait Modification Procedures as an EHB (Sec. Sec. 156.115(d) and 156.400)

In the 2025 Marketplace Integrity and Affordability proposed rule (90 FR 12985 through 12987), we proposed to amend Sec. 156.115(d) to provide that issuers of non-grandfathered individual and small group market health insurance coverage--that is, issuers of coverage subject to EHB requirements--may not provide coverage for sex-trait modification as an EHB beginning with PY 2026.

Section 1302(a) of the ACA provides for the establishment of an EHB package that includes coverage of EHB (as defined by the HHS Secretary), cost-sharing limits, and AV requirements. Among other things, the law directs that the scope of the EHB be equal in scope to the benefits provided under a typical employer plan and that they include at least the 10 general categories outlined in the statute and the items and services covered within those categories.\185\

\185\ See section 1302(b)(2)(A) of the ACA. See also section 1302(b)(1) of the ACA, delineating the 10 general categories of EHB: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; laboratory services; preventive and wellness services and chronic disease management; and pediatric services, including oral and vision care.

Section 156.115(d) currently provides that for plan years beginning on or before January 1, 2026, an issuer of a plan offering EHB may not include routine non-pediatric dental services, routine non-pediatric eye exam services, long-term/custodial nursing home care benefits, or non-medically necessary orthodontia as EHB; and, for plan years beginning on or after January 1, 2027, an issuer of a plan offering EHB may not include routine non-pediatric eye exam services, long-term/ custodial nursing home care benefits, or non-medically necessary orthodontia as EHB. In the EHB Rule (78 FR 12845), we stated that routine non-pediatric dental services are not typically included in the medical plans offered by employers and are often provided as excepted benefits by the employer. We accordingly proposed and finalized the rule prohibiting issuers from covering these services as EHB.\186\

\186\ In the 2025 Payment Notice (89 FR 26343), we finalized the removal of the regulatory prohibition at Sec. 156.115(d) on issuers from including non-pediatric dental services as EHB for plan years beginning on or after January 1, 2027.

Because the scope of EHB must be equal in scope to the benefits provided under a typical employer plan, and coverage of sex-trait modification is not typically included in employer-sponsored plans, in the proposed rule (90 FR 12986), we proposed to add “sex-trait modification” to the list of items and services that may not be covered as EHB beginning in PY 2026. As noted in the proposed rule (90 FR 12986), such procedures sometimes are referred to as “gender affirming care,” and were referred to in the proposed rule as “sex- trait modification.” The proposed rule (90 FR 12986) stated that the term “sex” is defined as a person's immutable biological classification as either male or female; the term “female” is a person of the sex characterized by a reproductive system with the biological function of producing eggs (ova); and the term “male” is a person of the sex characterized by a reproductive system with the biological function of producing sperm.\187\

\187\ See also, Section 2 of E.O. 14168 and Office of Women's Health (2025, Feb. 19). Sex-Based Definitions. Dep't of Health and Human Services. Retrieved March 6, 2025, from https://womenshealth.gov/article/sex-based-definitions.

In the proposed rule (90 FR 12986), we stated that although the fact that sex-trait modification is not typically included in employer- sponsored plans is an independent, sufficient, and legally compelling reason for our proposal, we acknowledged recent executive orders \188\ that have been subject to preliminary injunctions. We stated that the agency made this proposal independently of the executive orders because sex-trait modification is not typically included in employer health plans and therefore cannot legally be covered as EHB. The agency acknowledged in the proposed rule that two courts have issued preliminary injunctions relating to the executive orders described above and stated that it did not rely on the enjoined sections of the executive orders in making this proposal.

\188\ Executive Order 14168, “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government” (E.O. 14168); Executive Order 14187, “Protecting Children From Chemical and Surgical Mutilation” (E.O. 14187).

In particular, we noted in the proposed rule (90 FR 12986) that the United States District Court for the Western District of Washington has issued a preliminary injunction that enjoined defendant agencies “from enforcing or implementing section 4 of Executive Order 14187 within the Plaintiff States,” as well as “sections 3(e) or 3(g) of Executive Order 14168 to condition or withhold Federal funding based on the fact that a health care entity or health professional provides gender- affirming care within the Plaintiff States.” Washington v. Trump, No. 2:25-CV-00244-LK, 2025 WL 659057, at *28 (W.D. Wash. Feb. 28, 2025), appeal docketed, No. 25-1922 (9th Cir. Mar. 24, 2025). The United States District Court for the District of Maryland has issued a preliminary injunction that enjoins the Federal defendants in that case “from conditioning, withholding, or terminating Federal funding under section 3(g) of Executive Order 14168 and section 4 of Executive Order 14187, based on the fact that a healthcare entity or health professional provides gender-affirming medical care to a patient under the age of nineteen” and required a written notice “instruct[ing] the aforementioned groups that Defendants may not take any steps to implement, give effect to, or reinstate under a different name the directives in section 3(g) of Executive Order 14168 or section 4 of Executive Order 14187 that condition or withhold Federal funding based on the fact that a healthcare entity or health professional provides gender-affirming medical care to a patient under the age of nineteen.” PFLAG, Inc. v. Trump, No. CV 25-337-BAH, 2025 WL 685124, at *33 (D. Md. Mar. 4, 2025), appeal docketed, No. 25-1279 (4th Cir. Mar. 24, 2025). We stated in the proposed rule that if our proposal were finalized, it would not conflict with those preliminary injunctions because, among other things, it would be based on independent legal authority and reasons and not the enjoined sections of the executive orders. We further stated that any final rule on this issue would not be effective until PY 2026, and would not be implemented, made effective, or enforced in contravention of any court orders.\189\

\189\ HHS intends to notify the courts in both cases about this rule after it has been published in the Federal Register.

In the proposed rule (90 FR 12986), we noted that with regard to whether sex-trait modification is typically included in employer- sponsored plans, we are aware that employer-sponsored plans often exclude coverage for some or all sex-trait modification, and it is our understanding that these exclusions may include use of puberty blockers, sex hormones, and surgical procedures identified in E.O. 14187. We stated that this includes many small group plans that do not cover such services and noted that 42 States chose or defaulted to small group plans as their EHB-benchmark plan selections in 2014 and 2017.\190\ In addition, we stated that, of those employer-sponsored plans that do cover sex-trait modification, these EHB-benchmark plan documents would indicate that there is inconsistency nationwide with respect to the scope of benefits included. We noted that the infrequent and inconsistent coverage of such benefits is also apparent in the treatment of sex-trait modification by the States and territories, which provides further support that coverage of these benefits is not typical, and we stated our understanding that the majority of States and territories do not include coverage for sex-trait modification in State employee health benefit plans or mandate its coverage in private health insurance coverage.\191\ In addition, we noted that 12 States and 5 territories do not mention or have no clear policy regarding sex- trait modification in their employee health benefit plans, and 14 States explicitly exclude sex-trait modification from their State employee health benefit plans.\192\

\190\ CMS. (2016, April 8). Final List of BMPs. https://www.cms.gov/cciio/resources/data-resources/downloads/final-list-of-bmps_4816.pdf.

\191\ Movement Advancement Project. 2025. “Equality Maps: Healthcare Laws and Policies.” https://www.mapresearch.org/equality-maps/healthcare_laws_and_policies. Accessed Feb. 23, 2025.

\192\ Ibid.

As explained in the proposed rule (90 FR 12986 through 12987), we believe that coverage of sex-trait modification may be sparse among typical employer plans because the rate of individuals utilizing sex- trait modification is very low; less than 1 percent of the U.S. population seeks forms of sex-trait modification,\193\ and this low utilization is apparent in the External Data Gathering Environment (EDGE) limited data set.\194\ In this data set, which encompasses the majority of health insurance enrollees covered outside of large group plans, approximately 0.11 percent of enrollees in non-grandfathered individual and small group market plans utilized sex-trait modification during PYs 2022 and 2023.\195\

\193\ See Hughes, L.; Charlton, B.; Berzansky, I.; et al. (2025, Jan. 6). Gender-Affirming Medications Among Transgender Adolescents in the US, 2018-2022. JAMA Pediatr. 179(3):342-344. https://jamanetwork.com/journals/jamapediatrics/fullarticle/2828427; see also, Dai, D.; Charlton, B.; Boskey, E.; et. al. (2024, June 27). Prevalence of Gender-Affirming Surgical Procedures Among Minors and Adults in the US. JAMA Netw Open. 7(6):e2418814. https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2820437.

\194\ The EDGE limited data set contains certain masked enrollment and claims data for on- and off-Exchange enrollees in risk adjustment covered plans in the individual and small group (including merged) markets, in States where HHS operated the risk adjustment program required by section 1343 of the ACA, and is derived from the data collected and used for the HHS-operated risk adjustment program.

\195\ See https://www.cms.gov/data-research/files-order/limited-data-set-lds-files/enrollee-level-external-data-gathering-environment-edge-limited-data-set-lds. To request the EDGE limited data set, refer to the instructions at https://www.cms.gov/data-research/files-for-order/limited-data-set-lds-files.

We noted that nothing in this proposal would prohibit health plans from voluntarily covering sex-trait modification as a non-EHB consistent with applicable State law, nor would it prohibit States from requiring the coverage of sex-trait modification, subject to the rules related to State-mandated benefits at Sec. 155.170.

We stated in the proposed rule (90 FR 12987) that we are also aware that some interested parties do not believe that sex-trait modification services fit into any of the 10 categories of EHB and, therefore, do not fit within the EHB framework even if some employers cover such services. As discussed in the proposed rule (90 FR 12987), the items and services that comprise sex-trait modification are performed to align or transform an individual's physical

appearance with an identity that differs from his or her sex. We stated that we are also concerned about the scientific integrity of claims made to support their use in health care settings. As such, we sought comment on whether it would be appropriate to exclude sex-trait modification as an EHB.

Consistent with the other listed benefits that issuers must not cover as an EHB at Sec. 156.115(d), we did not propose a definition of “sex-trait modification.” However, we sought comment on whether we should adopt a formal definition of “sex-trait modification,” whether there are current issuer standards with regards to what is considered “sex-trait modification”; and how such a definition could best account for the items and services currently covered or excluded as sex-trait modification by plans subject to the EHB requirement.

We also recognized in the proposed rule (90 FR 12987) that there are some medical conditions, such as precocious puberty, or therapy subsequent to a traumatic injury, where items and services that are also used for sex-trait modification may be appropriate. We sought comments regarding whether we should define explicit exceptions to permit the coverage of such items and services as EHB for other medical conditions, and what those conditions are, for potential inclusion in finalizing as part of this rule.

We noted in the proposed rule (90 FR 12987) that pursuant to Sec. 155.170(a)(2), a covered benefit in a State's EHB-benchmark plan is considered an EHB. There is no obligation for the State to defray the cost of a State mandate enacted after December 31, 2011, that requires coverage of a benefit covered in the State's EHB-benchmark plan. If a State mandates coverage of a benefit that is in its EHB-benchmark plan, the benefit will continue to be considered EHB and the State will not have to defray the costs of that mandate. However, if at a future date the State updates its EHB-benchmark plan under Sec. 156.111 and removes the mandated benefit from its EHB-benchmark plan, the State may have to defray the costs of the benefit under the factors set forth at Sec. 155.170 as it will no longer be an EHB after its removal from the EHB-benchmark plan.

In the proposed rule (90 FR 12987), we also noted that there are some State EHB-benchmark plans that currently cover sex-trait modification as an EHB. Other State EHB-benchmark plans provide coverage for sex-trait modification, but do not explicitly mention sex- trait modification or any similar term.\196\ We stated that if this proposal were finalized as proposed, health insurance issuers would be prohibited from providing coverage for sex-trait modification as an EHB in any State beginning in PY 2026. We further stated that if any State separately mandates coverage for sex-trait modification outside of its EHB-benchmark plan, the State would be required to defray the cost of that State mandated benefit as it would be considered in addition to EHB pursuant to Sec. 155.170. We explained, however, that if any such State does not separately mandate coverage of sex-trait modification outside of its EHB-benchmark plan, there would be no defrayal obligation. We noted that States may consider mandating coverage of sex-trait modification in the future, in which case defrayal obligations at Sec. 155.170 would apply, and CMS would enforce the defrayal obligations appropriately. Further, we explained that issuers in States in which sex-trait modification is currently an EHB would also be prohibited from covering it as an EHB beginning in PY 2026. However, we explained that they may opt to continue covering sex-trait modification consistent with applicable State law, but not as an EHB. We sought comment on whether additional program integrity measures would be necessary to ensure Federal subsidies do not continue to fund sex-trait modification if this proposal is finalized.

\196\ The EHB-benchmark plans for California, Colorado, New Mexico, Vermont, and Washington specifically include coverage of some sex-trait modification. The EHB-benchmark plans of six other States do not expressly include or exclude coverage of sex-trait modification. The EHB-benchmark plans of 40 States include language that excludes coverage of sex-trait modification.

Lastly, we sought comment on the proposed effective date of this proposal. We proposed PY 2026 as the effective date for when issuers subject to EHB requirements would be prohibited from covering sex-trait modification as an EHB. We sought comment specifically on the impact that this proposal would have, if finalized, on health insurance coverage in the individual, small group, and large group markets for PY 2026, or whether an earlier or later effective date is justified.

After consideration of comments and for the reasons outlined in the proposed rule and this final rule, including our responses to comments, we are finalizing this policy with the following modification. In response to comments, we are finalizing at Sec. 156.400 the addition of a definition of “specified sex-trait modification procedure,” which means any pharmaceutical or surgical intervention that is provided for the purpose of attempting to align an individual's physical appearance or body with an asserted identity that differs from the individual's sex either by: (1) intentionally disrupting or suppressing the normal development of natural biological functions, including primary or secondary sex-based traits; or (2) 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. Such term does not include procedures undertaken (1) to treat a person with a medically verifiable disorder of sexual development, or (2) 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. This policy is applicable for PY 2026 and beyond.

We summarize and respond below to public comments received on our proposal to prohibit issuers subject to EHB requirements from covering sex-trait modification as an EHB beginning with PY 2026.

Comment: Many commenters disagreed with the proposition that coverage for sex-trait modification is not included under a typical employer plan. These commenters cited various reports, including a report from Marsh McLennan,\197\ a major employee benefit services company, to dispute this proposition. Many commenters raised as evidence that in the 2025 Corporate Equality Index,\198\ the Human Rights Campaign Foundation found that 72 percent of Fortune 500 businesses, and 91 percent of businesses listed on the Corporate Equality Index, offer coverage of treatment for gender dysphoria. These commenters noted that, as a result, over 1,300 major employers nationwide cover this care, 28 times as many businesses as in 2009. These commenters further stated that coverage for gender dysphoria is widespread among State employee plans (24 States and DC), Medicaid (27 States, Puerto Rico, and DC), and QHPs offered on the Exchanges (55 percent of QHPs across all 50 States covered this care in PY 2025) and that many States prohibit exclusions of coverage for gender

dysphoria (24 States and DC).\199\ Many of these same commenters stated that the KFF 2024 Employer Health Benefit Survey found that only one- third of employers with 200 or more employees responded that they did not offer coverage for sex-trait modification hormone therapy. These commenters further stated that the survey found that the largest firms in the country (5,000 or more employees) employ 43 percent of people with job-based coverage and were significantly more likely to report covering hormone therapy in relation to sex-trait modification in their largest plan by enrollment. Another commenter pointed to a study by Out2Enroll of 2025 silver plans in all 50 States and DC, which found that 92.9 percent of the 2,138 silver plans did not exclude certain services for transgender-identifying people and that over half of all reviewed plans (54.6 percent) included affirmative language indicating that medically necessary care is covered.

\197\ Umland, B; Hifer, E. Health benefits that matter to the LGBTQ+ community: By the numbers. US Health News, Marsh McLennan, available at https://www.mercer.com/en-us/insights/us-health-news/health-benefits-that-matter-to-the-lgbtq-community/.

\198\ Human Rights Campaign Foundation. “Corporate Equality Index 2025” available at https://reports.hrc.org/corporate-equality-index-2025.

\199\ Movement Advancement Project. “Equality Maps: Healthcare Laws and Policies” available at https://www.lgbtmap.org/equality-maps/healthcare_laws_and_policies.Accessed05/28/2025.https://www.lgbtmap.org/equality-maps/healthcare_laws_and_policies. Accessed 05/28/2025.

Some commenters opined that CMS failed to include evidence in the proposed rule that coverage for sex-trait modification is not typically included in employer-sponsored coverage.

One commenter disagreed with the proposed rule's reliance on the Movement Advice Project (MAP) report to support the claim that sex- trait modification generally is not covered under typical employer- sponsored plans for treatment of gender dysphoria. This commenter stated that the MAP report conflicts with several studies, HHS did not include portions of the report that did not support its conclusions, and that the MAP report conflates States' transgender-identifying population numbers with an analysis of how many employers categorically exclude from coverage sex-trait modification services as treatment for gender dysphoria.

One commenter disagreed that the fact that some States that do not mention or have no clear policy on coverage of sex-trait modification services is evidence that sex-trait modification is not covered in typical employer plans. This commenter stated that this lack of clarity is likely because sex-trait modification encompasses a wide array of services that are also used to treat other health conditions, in addition to treatment for gender dysphoria, so coverage of such services for sex-trait modification purposes may not explicitly be stated in some health plans.

Response: We disagree with commenters' assertion that sex-trait modification is covered under typical employer-sponsored plans. In fact, according to the KFF 2024 Employer Health Benefits Survey, which was cited by many commenters, only 24 percent of employers with 200 or more employees responded that they cover gender-affirming hormone therapy; \200\ and an additional 45 percent of such employers were unable to confirm whether they offer coverage for such services. It is also reasonable to assume that, compared to gender-affirming hormone therapy coverage rates, an even lower percentage of the employers surveyed by KFF cover more invasive, higher cost sex-trait modification surgeries. We believe this evidence substantiates the claim that typical employer plans are not covering specified sex-trait modification procedures, as defined in this rule.

\200\ Claxton, G. Et al. (2024, October 9). Employer Health Benefits. KFF. https://www.kff.org/health-costs/report/2024-employer-health-benefits-survey/.

Additionally, we disagree with the commenter who took issue with the MAP report as a basis for this policy change. The Department is of the view that we appropriately relied on and represented the materials, and that they represent a sound statistical basis to inform our final policy. This is consistent with the statutory requirement that EHB align with the coverage provided by a typical employer plan,\201\ and CMS history of excluding by regulation such services from EHB.\202\

\201\ 42 U.S.C. 18022(b)(2).

\202\ 45 CFR 156.115(d).

We acknowledge that very large employers that represent a larger share of employees may be more likely to cover the specified sex-trait modification procedures that are the focus of this policy. However, in the Department's experience, this mainly reflects the fact that larger employers tend to have more financial resources to provide a more generous benefit set. The statute specifically references the typical employer and not the typical employee, which acts to restrain the EHB from reflecting the more generous and costly health plans offered by very large employers. Moreover, very large employers also receive more pressure from advocacy organizations to cover sex-trait modification procedures and, therefore, likely do not represent the typical employer to the degree a portion respond to this pressure. In regard to the Human Rights Foundation Corporate Equality Index findings, we note that the employers referenced in this report volunteered to participate in the advocacy organization's program and such voluntary participation suggests these employers do not represent the typical employer and, instead, align with the advocacy organization's views.

Comment: Some commenters stated that the argument that typicality is equivalent to a benefit's utilization rate is flawed, and that no one would argue against coverage for people with rare cancers that affect few people, or heart transplants, for example. Some commenters also stated that the utilization data cited in the proposed rule did not support CMS' claims regarding typical employer coverage because they: (1) spoke to actual utilization and not available coverage, and (2) reflect consumer experience for consumers participating in Exchange rather than employer-sponsored insurance. Other commenters raised concerns that the observed low utilization of sex-trait modification services may reflect the relative rarity of gender dysphoria as a diagnosis, rather than low levels of coverage for such services under Exchange or employer-sponsored coverage.

Response: We continue to believe that utilization data from the EDGE limited data set offers a useful picture of the coverage offered by a typical employer. While commenters raised concerns that the observed low utilization of sex-trait modification services may reflect the relative rarity of gender dysphoria as a diagnosis, rather than low levels of coverage for such services under Exchange or employer- sponsored coverage, low utilization, as evidenced by EDGE data, also supports the contention that specified sex-trait modification procedures, as defined in this final rule, are not covered by typical employer plans. Specifically, we believe these data reflect the coverage experiences of consumers receiving coverage through the small business health options program (SHOP), which we believe to be more reflective of the coverage typically provided by the majority of employers, which are significantly smaller \203\ than those employers surveyed by, for example, the Corporate Equity Index or KFF. We disagree with commenters' concern that utilization, as measured through the EDGE database, does not accurately

reflect the level of coverage available to the enrollees receiving employer-sponsored coverage, given that all plans available to Exchange consumers (those upon whom EDGE data are based), must adhere to the requirements for EHB, which are themselves closely tied to typical employer-sponsored coverage.

\203\ Bureau of Labor Statistics data (available at: https://www.bls.gov/charts/county-employment-and-wages/employment-by-size.htm) suggest that approximately 58% of U.S. employers employ 99 or fewer employees--substantially fewer than the employers surveyed by KFF or the Corporate Equity Index.

Comment: One commenter noted that gaps in coverage or ambiguity regarding coverage because the issuer's plan documents do not reference sex-trait modification often means issuers will adjudicate medical necessity on a case-by-case basis and do not justify a claim that sex- trait modification is not typically covered by employer plans. Another commenter suggested that the typicality standard should be understood only as setting a guideline for minimum benchmark coverage and that typical employer plans have historically excluded coverage for the same services that the EHB provision was intended to expand. This commenter therefore suggested that CMS should not take the requirement that EHBs be equal in scope to a typical employer plan to mean that (1) EHB- benchmark plans cannot or should not be more generous than a typical employer plan, nor that (2) just because a particular service is not commonly covered by typical employer plans, that that should automatically exclude those services from being EHB.

Other commenters stated that the proposal conflicts with CMS' regulations on typicality for EHB-benchmark plans, which allow States to require coverage beyond what is covered in a typical employer plan, so long as the scope of benefits is not more generous than the scope of benefits in the most generous plan in the State. Other commenters urged that the appropriate analysis regarding the typical employer plan per CMS' own regulations is not whether most other States include sex-trait modification in their EHB-benchmark plans or the number of enrollees utilizing this care nationwide, but instead whether such care is covered by typical employer plans in the State selecting it as EHB. These commenters emphasized that a requirement that States exclude sex- trait modification from their State EHB-benchmark plans would be inconsistent with typical employer plans in their respective States.

Response: We disagree with commenters' position that the statutory requirement that EHB be equal in scope to the benefits provided by a typical employer plan was intended to close gaps in coverage by setting a floor for coverage. We further disagree that sex-trait modification procedures, if not covered by typical employer plans, are required to be covered as an EHB to correct gaps in coverage. The position that EHB be defined in a manner that addresses gaps in coverage must conform to the typicality requirement.

Comment: Some commenters stated that CMS should consider in its analysis of typical employer plan coverage for sex-trait modification that half of all States have interpreted Federal and State laws to prohibit discrimination based on sexual orientation and gender identity, which extends to most public and private health insurance plans.

Response: We acknowledge that several States have interpreted Federal and State laws to prohibit discrimination against sexual orientation and gender identity, which may influence employer coverage of sex-trait modification services. We have considered this and have found that, despite such State efforts, coverage of sex-trait modification in employer-sponsored plans remains atypical. After finalizing the section 1557 nondiscrimination rules in 2016 that added a definition of sex discrimination to incorporate discrimination on the basis of gender identity, some State departments of insurance issued policy bulletins making clear that exclusion of such types of coverage are discriminatory based on section 1557.\204\ Immediately after our amendment to section 1557 nondiscrimination regulations in 2020 (amending the 2016 definition of sex discrimination to incorporate discrimination on the basis of gender identity), an advocacy organization that tracks coverage of sex-trait modification procedures on the Exchanges found “the number of insurers using transgender- specific exclusions . . . more than doubled.” \205\ Since 2021, over half of States have taken action to restrict sex-trait modification procedures for minors.\206\ We believe these swings in State and Federal policy reflect the relatively recent emergence and ongoing controversy over coverage of the specified sex-trait modification procedures we address in this final rule, which supports the conclusion that such procedures are not typically covered by employer-plans.

\204\ See, e.g., Oregon Department of Consumer and Business Services, Division of Financial Regulation. Bulletin DFR 2016-1 (September 7, 2016), available at https://dfr.oregon.gov/laws-rules/Documents/Bulletins/bulletin2016-01.pdf; State of Vermont, Department of Financial Regulation. Insurance Bulletin 174 (rev. June 12, 2019), available at https://dfr.vermont.gov/sites/finreg/files/regbul/dfr-bulletin-insurance-174-gender-dysphoria-surgery.pdf; Pennsylvania Bureau of Life, Accident and Health, Office of Insurance Product Regulation. Notice Regarding Nondiscrimination; Notice 2016-05 (April 30, 2016), available at https://www.pacodeandbulletin.gov/Display/pabull?file=/secure/pabulletin/data/vol46/46-18/762.html.

\205\ AGLY v. USDHHS, 557 F. Supp. 3d 224, at 239 (internal citations omitted).

\206\ https://www.lgbtmap.org/equality-maps/healthcare_youth_medical_care_bans.

Comment: One opposing commenter stated that HHS provided no evidence in the proposed rule that treatment for gender dysphoria has ever been offered by issuers under an excepted benefit plan and noted that treatment for gender dysphoria is therefore dissimilar to the other benefits in Sec. 156.115(d) that are excluded from being covered as EHB. This same commenter stated that the other benefits at Sec. 156.115(d) are excluded as EHB by general designation (eye exam services, home care benefits, and non-medically necessary orthodontia), but that here HHS seeks to categorically prohibit specific medical services used by a specific population (people diagnosed with gender dysphoria) even when they are medically necessary. Many commenters raised concerns that this could be a slippery slope to excluding other medically necessary benefits as EHB.

Some opposing commenters urged CMS to preserve the framework that allows States to adopt an EHB-benchmark plan that best fits their unique market dynamics. Such commenters stated that this proposal would be a significant departure from the existing EHB-benchmark plan framework because it would prohibit coverage of services as EHB at a more granular level than before and that this could restrict the ability of States to respond to local needs, increase the price of coverage, limit plan and provider innovation, and hinder flexibility for issuers to respond to changes in scientific evidence and clinical practice. Many commenters noted that the impact of the proposal on individuals without gender dysphoria seeking care will also lead to higher out-of-pocket costs and access issues throughout the U.S.

Response: We disagree that the prohibition on coverage of specified sex-trait modification procedures as EHB, as finalized in this rule, is likely to create a slippery slope towards additional coverage exclusions. We acknowledge commenters' concern that other services are excluded from coverage as EHB on the grounds that they are excepted benefits and that specified sex-trait modification procedures are not generally covered as excepted benefits. However, the contention underlying the prohibition of other services (for example, routine adult vision) is the same as that at issue with respect to specified sex-trait modification

procedures--that they are not typically covered by employer-sponsored plans. Specifically, specified sex-trait modification procedures have not typically been provided by employers through any coverage vehicle, be that an excepted benefit plan or otherwise. As such, we are not concerned that prohibiting coverage of specified sex-trait modification procedures as EHB is likely to curtail the coverage of other services, given that nothing in this prohibition is intended to place limitations on services deemed EHB, so long as those services are in accordance with the statutory requirement that EHB be equal in scope to the benefits provided under atypical employer plan.

Additionally, while we are largely supportive of State flexibility with regard to establishing EHB, we take seriously the responsibility to ensure consistency with the parameters on EHB enumerated in the statute. As such, we have engaged in rulemaking on a number of occasions to refine our interpretation of the typicality standard. We believe the policy we are finalizing is neither a departure from our previous posture on prohibited benefits, in which we have considered whether such benefits are included in a typical employer plan, nor an action that exceeds the authority explicitly articulated in statute. Rather, we rely on the Secretary's broad regulatory authority to define EHB and the statutory requirement that EHB be equal in scope to the benefits provided under a typical employer plan.

Finally, we do not believe there is merit to commenters' concerns regarding unreasonable increases in out-of-pocket costs for consumers utilizing sex-trait modification services that do not meet the definition of specified sex-trait modification procedures finalized in this rule, or negative impacts to care based on alleged ambiguities introduced by this policy change. We believe that issuers have the appropriate flexibility to ensure that services that may or must remain covered as EHB retain such coverage, and that services that may not be covered as EHB will no longer be covered as such without disrupting enrollees' receipt of appropriate care. And, to the extent that out-of- pocket costs do increase for some consumers utilizing specified sex- trait modification procedures as defined in this rule, whose cost- sharing may increase as a result of such services no longer qualifying as EHB, we believe that will align with the degree of out-of-pocket costs for such services experienced by consumers covered by employer- sponsored plans.

Comment: Some commenters disagreed with the proposal to prohibit coverage of sex-trait modification as an EHB on the basis that numerous leading medical professional organizations, including the American Medical Association, American Academy of Pediatrics, American College of Obstetricians, and Pediatric Endocrine Society, and medical journal articles have found sex-trait modification to be medically necessary and that people who have received sex-trait modification services rarely regret those services. Many commenters stated that sex-trait modification is the standard of care for gender dysphoria and provided copies of or links to peer-reviewed journal articles in support of this assertion.

Other commenters supported the proposal and referenced peer- reviewed studies and medical evidence or anecdotal scenarios in support of the policy. For example, some commenters stated that patients, especially children, may feel regret after utilizing sex-trait modification services and may suffer negative effects on their future fertility and sexual function.

One commenter opined that use of puberty blockers to suppress puberty could possibly further gender dysphoria symptoms, and that those symptoms, but for the puberty blockers, might have otherwise naturally subsided over time. Some commenters stated that sex-trait modification treatment is “experimental” and “dangerous,” especially for children, and that it can lead to sexual dysfunction and/or sterility and place people at higher risk of other conditions such as obesity, diabetes, and cardiovascular disease. Some commenters argued that many States have prohibited sex-trait modification interventions for children and that this is evidence that science supporting such services is medically unsound.

Response: CMS understands the lack of consensus regarding the efficacy and necessity of sex-trait modification services for people with gender dysphoria, and especially children, as evidenced by the comments received and published peer-reviewed studies.\207\ Likewise, on June 18, 2025, the Supreme Court upheld a State's ban on certain medical treatments for transgender minors, acknowledging that the dispute regarding these treatments “carries with it the weight of fierce scientific and policy debates about the safety, efficacy, and propriety of medical treatments in an evolving field.” \208\ We carefully read each comment submitted and appreciate that commenters shared a myriad of opinions and personal stories, both in support of and against the proposal. However, we are not persuaded that the existence of journal articles and clinical guidelines supporting the use of sex-trait modification services for the treatment of gender dysphoria should require that specified sex-trait modification procedures be covered as an EHB. In fact, such a stance would be a departure from the current EHB

framework which, with the very limited exceptions of the preventive services and prohibition on discrimination at Sec. 156.125(a), makes no reference to clinical bases as a justification for whether something is EHB or not.

\207\ See Treatment for Pediatric Gender Dysphoria, May 1, 2025, Department of Health and Human Services. (“The umbrella review found that the overall quality of evidence concerning the effects of any intervention on psychological outcomes, quality of life, regret, or long-term health, is very low. . . The risks of pediatric medical transition include infertility/sterility, sexual dysfunction, impaired bone density accrual, adverse cognitive impacts, cardiovascular disease and metabolic disorders, psychiatric disorders, surgical complications, and regret.”) https://opa.hhs.gov/gender-dysphoria-report. Straub, J.J., Paul K.K., Bothwell, L.G., Deshazo, S.J., Golovko, G., Miller, M.S., & Jehle, D.V. (2024). Risk of Suicide and Self-Harm Following Gender- Affirmation Surgery. Cureus, 16(4):e57472. doi: 10.7759/ cureus.57472. (“There is ongoing controversy surrounding the benefits of gender-affirmation surgery on mental health. This controversy reflects diverse perspectives within the medical and research communities, emphasizing the need for a more comprehensive understanding of the psychological outcomes of gender-affirming procedures.”); Surendran, S., Toh, H.J., Voo, T.C., De Foo, C., & Dunn, M. (2025). A scoping review of the ethical issues in gender- affirming care for transgender and gender-diverse individuals. BMC Med Ethics 26, 54. https://doi.org/10.1186/s12910-025-01216-2 (“Despite extensive discussion, there remains significant disagreement and a lack of resolution on . . . ethical issues [related to sex-trait modification procedures].”); Effects of gender affirming therapies in people with gender dysphoria: evaluation of the best available evidence. Dr. Romina Brignardello- Petersen and Dr. Wojtek Wiercioch; Main report; May 16, 2022 (“[I]t is unknown whether people with gender dysphoria who use puberty blockers experience more improvement in gender dysphoria, depression, anxiety, and quality of life than those with gender dysphoria who do not use them. There is very low certainty about the effects of puberty blockers on suicidal ideation.”); Ludvigsson JF, Adolfsson J, H[ouml]istad M, Rydelius PA, Kristr[ouml]m B, Land[eacute]n M. A systematic review of hormone treatment for children with gender dysphoria and recommendations for research. Acta Paediatr. 2023 Nov;112(11):2279-2292. doi: 10.1111/apa.16791. Epub 2023 May 1. PMID: 37069492 (this systematic literature review concluded that the long-term effects of treatment of gender dysphoria in children below 18 years old with gonadotropin-releasing hormone analogues (GnRHa) are unknown and that “GnRHa treatment in children with gender dysphoria should be considered experimental treatment of individual cases rather than standard procedure); Straub J.J., Paul K.K., Bothwell L.G., et al. (April 02, 2024) Risk of Suicide and Self-Harm Following Gender-Affirmation Surgery. Cureus 16(4): e57472. doi:10.7759/cureus.57472 (“The results of this study indicate that patients who have undergone gender affirmation surgery are associated with significantly higher risks of suicide, self-harm, and PTSD compared to general population control groups in this real-world database.”).

\208\ See United States v. Skrmetti et al., No. 23-477 slip op. at *24 (U.S. June 18, 2025), available at https://www.supremecourt.gov/opinions/24pdf/23-477_2cp3.pdf.

The basis for prohibiting the coverage of specified sex-trait modification procedures as an EHB, as previously stated in the proposed rule and in this final rule, is that such benefits are not covered under typical employer plans. Section 1302(a)(1) of the ACA gives the Secretary broad latitude to define EHB, subject to ensuring that EHB is equal in scope to the benefits provided under a typical employer plan pursuant to section 1302(b)(2) of the ACA and meets the other limitations enumerated in section 1302(b) of the ACA. We understand that EHB cannot include all possible items and services for all possible diagnoses, simply by the plain language of section 1302 of the ACA, such as the requirement that benefits be “essential,” limited to at least the 10 enumerated categories, and equal in scope to the benefits provided under a typical employer plan.

The Department has also examined these issues elsewhere, including in a commissioned review of evidence and best practices \209\ regarding pediatric gender dysphoria. The report echoes some of the concerns commenters raised, however the report was distributed solely for the purpose of pre-dissemination peer review under applicable information quality guidelines. It has not been formally disseminated by the Department, therefore it does not represent and should not be construed to represent agency determination or policy. The report will undergo formal post-publication peer review involving interested parties with different perspectives according to the Information Quality Bulletin for Peer Review.

\209\ HHS (2025, May 1). Treatment for Pediatric Gender Dysphoria. Office of Population Affairs, Office of the Assistant Secretary for Health, available at https://opa.hhs.gov/sites/default/files/2025-05/gender-dysphoria-report.pdf.

Comment: Numerous commenters commented on the need to specifically define what sex-trait modification is, so that issuers have certainty as to what they can cover as EHB and consumers can have certainty as to what their plans cover. Some commenters raised concerns with the use of the term sex-trait modification and stated that the proposed rule lacked clarity regarding what specific sex-trait modification services would be prohibited from being covered as EHB.

Commenters also provided numerous examples of services they believe should fall under the definition of sex-trait modification. One commenter urged CMS to provide examples of services that would be prohibited from being covered as EHB under the term sex-trait modification, including the following: puberty blockers; hormone therapy; genital surgery (amputation, building replica cross-sex organs); non-genital cosmetic surgeries (mastectomy, breast construction, cheek/chin implants, rhinoplasty, feminization surgeries, liposuction, voice surgery, hair removal, and “Adam's Apple” reduction), and “erroneous” sex-trait modification psycho-social interventions. One commenter suggested that issuers be required to cover as EHB services to reverse the effects of sex-trait modification.

Other opposing commenters noted that sex-trait modification is not the clinically appropriate terminology when referring to treatment of individuals with gender dysphoria, citing to medical professional organizations, such as the American College of Obstetricians and Gynecologists, the American Medical Association, the American Academy of Family Physicians, and the American Psychiatric Association, which recommend the use of the term “gender-affirming care.” Several commenters opposing the proposal raised concerns that the proposal is too broad and could lead to inappropriate exclusions of treatments that are clinically distinct from sex-trait modification services for gender dysphoria. Many commenters stated that while sex-trait modification services can be used to affirm an individual's physical appearance or body with an asserted identity that differs from the individual's sex, sex-trait modification services are not used most commonly for gender transition purposes (for example, a biological female receiving hormone therapy for symptoms of menopause). Numerous commenters expressed that most people will use at least one service that could be used for sex- trait modification purposes in their lifetime. They expressed concern that without clarification, numerous services and drugs could be excluded for people who do not have gender dysphoria but who need them to treat other conditions.

Commenters opposing the proposal listed the following as some of the treatments and conditions unrelated to gender dysphoria that may be implicated by the broad scope of the proposal: precocious puberty; hormone replacement therapy to mitigate symptoms of vaginal atrophy and menopause; hysterectomies and mastectomies for cancer treatment or prevention; birth control; endocrine disorders; facial reconstruction; hair removal; hair implants; speech therapy; counseling; oophorectomy; sexual organ removal due to cancer; treatment for endometriosis, polycystic ovary syndrome, and other gynecological conditions; treatment for intersex conditions; and other reconstructive procedures (such as for trauma victims or cancer patients). Many commenters opposing the proposal noted that several of these interventions may involve modifying secondary sex characteristics, but are clearly not related to gender transition, and that CMS should either remove the term “sex-trait modification” from the final rule or define it narrowly and with specificity, consistent with accepted medical usage, to allow exceptions for unrelated and medically necessary treatments.

A few commenters who supported the proposal also requested clarification regarding the scope of services that are included in the term sex-trait modification. These commenters supported the proposal, but requested that CMS define what sex-trait modification means and specify the precise exclusions from the proposed prohibition on coverage of sex-trait modification as EHB, emphasizing the importance of these clarifications for enforceability of the proposal. One commenter suggested that coverage of EHB include services to assess the origins of a person's gender dysphoria.

One commenter supporting the proposal stated that sex-trait modification should mean services that reinforce an erroneous identity inconsistent with one's sex but should exclude from the definition of sex-trait modification any services that are routine or medically necessary to maintain physiological integrity or organ functioning or that are aimed at restoring or reconstructing form and function consistent with one's sex. One commenter supported coverage of diagnostic testing of newborns with congenital anomalies such as ambiguous genitalia, ostensibly to determine if the newborn has a disorder of sexual development.

One commenter opposing the proposal stated that CMS should not define explicit exceptions to the proposal for conditions other than gender dysphoria, such as cancer or precocious puberty, as doing so would discriminate on the basis of health conditions as well as transgender status. Many commenters expressed concern that patient conditions could worsen if their access to drugs or services were disrupted abruptly after losing coverage

for a service due to ambiguity as to what is considered sex-trait modification. Another opposing commenter urged CMS to refrain from defining “sex-trait modification,” stating that attempting to codify a definition risks oversimplifying the range of medical treatments that could fall under this term. One commenter suggested that coverage of EHB include services to assess the origins of a person's gender dysphoria, while another commenter opposing the proposal disagreed with how the proposed rule defined sex because the commenter believed the policy would exclude individuals who identify with their sex assigned at birth, but who have medical conditions that make them unable to reproduce. Many commenters opposing the policy expressed specific concern regarding how the proposal would apply to intersex people. These comments asserted that persons with disorders of sexual development may have variations in chromosomes, external genitalia, hormones, and reproductive organs, among other characteristics, that make them neither “male” nor “female.”

Response: We acknowledge concerns raised by commenters regarding the ambiguity of the term “sex-trait modification” as used in the proposed rule. As discussed elsewhere in this final rule, we are finalizing the addition of a definition of “specified sex-trait modification procedure” at Sec. 156.400 to ensure greater clarity regarding what procedures related to sex-trait modifications may and may not be covered as EHB. Additionally, we acknowledge that issuers may not categorize some benefits as sex-trait modification services, because they may instead adjudicate claims for such care based on determinations of medical necessity and the specific condition the service in question is intended to treat. We note that this policy change will not prohibit issuers from covering specified sex-trait modification procedures when deemed medically necessary. This is both because (1) this prohibition does not prohibit issuers from covering any types or forms of care; the prohibition is only on covering specified sex-trait modification procedures as EHB, and (2) this prohibition only prohibits issuers from covering specified sex-trait modification procedures as EHB if they meet the definition we are finalizing at Sec. 156.400.

We agree with commenters that providing a definition of the services implicated by this policy would provide issuers, consumers, health care providers, and other interested parties with greater certainty. Accordingly, after considering comments, we are finalizing the addition of a definition of “specified sex-trait modification procedure” at Sec. 156.400. Specifically, the term “specified sex- trait modification procedure” means any pharmaceutical or surgical intervention that is provided for the purpose of attempting to align an individual's physical appearance or body with an asserted identity that differs from the individual's sex either by: (1) intentionally disrupting or suppressing the normal development of natural biological functions, including primary or secondary sex-based traits; or (2) 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. Such term does not include procedures undertaken (1) to treat a person with a medically verifiable disorder of sexual development, or (2) 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.

After closely reviewing public comments, we believe this definition of “specified sex-trait modification procedure” addresses commenters' concerns that regulated entities may be confused regarding the scope of services subject to the policy, as well as concerns that people be able to access benefits as EHB when provided 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, as discussed further below. For example, this final rule would not prevent an issuer from covering as EHB mastectomies or breast reconstruction after a mastectomy for women with breast cancer or hormone therapy for a person with precocious puberty, cancer, or infertility, if those services are otherwise covered.

In response to comments received regarding the applicability of the term “sex-trait modification” versus the term “gender-affirming care”, we have adopted a narrowly tailored definition of “specified sex-trait modification procedures,” in part, because of commenter concerns that the term “gender-affirming care” generally encompasses a broader set of medical services, such as mental health services. For example, hormone replacement therapy may or may not be prohibited from coverage as EHB under our final policy, depending on whether or not that therapy is being provided in an attempt “to align an individual's physical appearance or body with an asserted identity that differs from the individual's sex,” among other defined considerations.

Although some commenters suggested including certain other services in the definition of sex-trait modification services, we decline to adopt an exhaustive list. We believe that the definition we are finalizing in this rule provides an appropriate and actionable degree of certainty and clarity for consumers, issuers, providers, and other interested parties, while also maintaining flexibility to accommodate changes in medical science and standards of care.

We agree with commenters that services or procedures that would constitute sex-trait modification procedures if provided for the purpose of “attempting to align an individual's physical appearance or body with an asserted identity that differs from the individual's sex” do not constitute specified sex-trait modification procedures if provided for a different purpose. Specifically, the definition of a specified sex-trait modification procedure categorically excludes procedures undertaken: (1) to treat a person with a medically verifiable disorder of sexual development, and (2) 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. We believe these exclusions are fully responsive to commenters' concerns that sex-trait modification be narrowly defined. These exclusions will ensure that services that may be employed to effectuate sex-trait modification are not categorically excluded from coverage as EHB for other purposes.

We note, for example, that this definition will allow people with medically verifiable disorders of sexual development to receive surgical services as EHB, if otherwise covered by the plan. Similarly, those needing hormone therapy for cancer, menopause, or other conditions will still be able to receive that therapy as an EHB, if otherwise covered by the plan, as this is 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. These are examples and not an exhaustive list. Additionally, services to reverse the effects of specified sex-trait modification procedures and to treat conditions caused by specified sex-trait modification procedures, such as testing, medication, and care for iatrogenic hypogonadism, osteoporosis, osteopenia, and low testosterone, are still covered as EHB if otherwise included by the State's EHB-benchmark

plan. Further, nothing in this rule precludes coverage of testing to determine disorders of sexual development, including for newborns, from being an EHB, nor is coverage of diagnostic treatment to determine the psychological and/or physiological origin of an individual's gender dysphoria diagnosis precluded from being covered as EHB by this rule, should such treatment exist.

Comment: Several commenters raised different issues regarding costs. One commenter stated that an issuer's ongoing implementation costs by virtue of, for example, having to modify its claims processes and systems, would be higher than what the issuer would reimburse providers for the sex-trait modification services themselves, if these services were covered benefits, and that such implementation costs are not minuscule. This commenter noted that the policy would disproportionately affect smaller issuers and those issuers that primarily cater to low-income and medically underserved populations. Other commenters noted that covering sex-trait modification services in insurance plans is cost-neutral or cost-saving as there is no actuarial basis to price sex-trait modification surgeries separately from any other type of surgery.

Many commenters noted their belief that issuers dropping coverage of sex-trait modification services due to this proposal would increase out-of-pocket consumer costs, as the cost of care would be shifted to consumers. Numerous commenters also expressed concerns that this proposal would block consumers from accessing sex-trait modification services with the same cost-sharing and benefit design protections as the same services covered for non-sex-trait modification still included in the EHB package, and that users of these services are more likely to be low-income and economically vulnerable.

Many commenters expressed concern that the proposal would increase overall health care costs by shifting current treatment costs for sex- trait modification to hospitals and State and local governments. Other commenters opposing the proposal stated that this proposal could lead to States with budget concerns removing State coverage requirements for sex-trait modification services because they would otherwise be forced to defray the cost of requiring such coverage. Some commenters stated that they believed that if sex-trait modification is not covered as an EHB, there will be an increased prevalence of more costly conditions, like severe depression or osteoporosis. Other commenters noted concern that individuals will seek sex-trait modification procedures through unregulated and unofficial channels if issuers stop covering it entirely which could lead to downstream health issues. Commenters noted that uncompensated care would likely increase; these commenters also noted concerns with the proposal leading to increased risk of psychiatric symptoms leading to more utilization of psychiatric services, including psychiatric hospitalizations for these patients if current treatments were no longer covered. One commenter believed that the proposal would have a destabilizing effect on insurance markets where sex-trait modification services were previously covered.

Response: We realize that smaller issuers often have outsized costs when new requirements are put into place that apply to all issuers, simply because they lack economies of scale that some of their larger, nationwide counterparts may have. However, we also believe that this final rule does not require issuers to undergo complex system builds or process changes in order to implement this policy and are not persuaded that the burden of any changes to processes and systems is a compelling basis for not finalizing this proposal. Specifically, issuers are already required to ensure that benefits that are not EHB are appropriately designated as such in the Plans & Benefits Template completed as part of the QHP certification application and that the percentage of premium attributable to EHB is accurately reflected, so that APTC does not erroneously subsidize non-EHB. Although under this final rule, there could be services that can or cannot be covered as EHB depending on diagnosis, we believe that issuers should already have the capability to differentiate between these claims since they already have to make these distinctions today. For example, currently, issuers must ensure that benefits that can never be EHB, such as routine non- pediatric eye exam services or non-medically necessary orthodontia pursuant to Sec. 156.115(d), are not erroneously noted as EHB in plan filings and claims processing. We believe that what an issuer is required to do under this final policy to exclude coverage for specified sex-trait modification procedures as EHB is similar to how issuers currently handle coverage for other claims. Additionally, while issuers may not be currently differentiating claims for specified sex- trait modification procedures in this manner, in any State there exists the possibility of State mandated benefits changing the manner in which the issuer designates discrete covered services as either EHB or non- EHB--as such, we believe issuers have this capability for any benefit.

We do not believe that whether a benefit is cost-neutral from an actuarial perspective has bearing on whether it should be an EHB. A benefits package is comprised of numerous benefits, some of which are cost-neutral or even cost-saving, and some of which are not. If issuers seek to voluntarily cover specified sex-trait modification procedures as non-EHB, they would need to price the services accordingly.

We agree with commenters that for those States that wish to mandate coverage of specified sex-trait modification procedures, they will be responsible for defraying this cost pursuant to Sec. 155.170(b). However, there is nothing inherently unique about specified sex-trait modification procedures as related to the overall defrayal policy; if a State wishes to mandate a benefit that is not EHB, it must defray the cost of that benefit, regardless of what that benefit is. This is a longstanding EHB policy and furthers State flexibility to regulate their own markets and ensure coverage of benefits that are most critical in their State.

We also understand concerns that there may be some people enrolled in plans that must cover EHB who seek specified sex-trait modification procedures who will now need to pay for the full cost out-of-pocket, unless the coverage is State-mandated or an issuer voluntarily offers such coverage. However, this is the case with any benefit that is not EHB. The framework for EHB as established in section 1302(b)(2) of the ACA requires EHB to be “equal to the scope of benefits provided under a typical employer plan.” There will necessarily be some benefits that are not EHB. This final rule better aligns coverage with the statutory requirements. In response to concerns that people seeking sex-trait modification services are often medically underserved, lower-income, and more economically vulnerable than the general population, we note that in defining the EHB, we have attempted to balance coverage generosity and affordability, with the realization that what makes coverage more affordable for some, may in turn make certain benefits less affordable for others.

In addition, while some commenters expressed concerns about costs being shifted to local governments and hospital uncompensated care, we emphasize that nothing in this final rule requires States or hospitals to develop

programs to fund specified sex-trait modification procedures. This policy is not likely to result in additional uncompensated care for mental health services because it does nothing to change the status of mental health services as EHB. We reiterate that mental health services will continue to be available, including for persons with gender dysphoria and those seeking specified sex-trait modification procedures, within their respective healthcare plans. We also expect that covered services 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 will continue to be available. Additionally, to the extent they are presently covered as EHB, services that become necessary due to discontinuation of specified sex-trait modification procedures, such as treatment for bone mineral density loss, will continue to be covered as EHB.

We disagree that prohibiting coverage of specified sex-trait modification procedures as EHB in States that previously required such coverage would be destabilizing for the insurance market. First, States have the option of requiring this coverage as long as they defray the cost pursuant to Sec. 155.170. Second, the current EHB-benchmark plan framework at Sec. 156.111(a) and substitution policy at Sec. 156.115(b) allow benefits to change as long as they comply with other requirements related to EHB.

We also acknowledge commenters' concern that gender dysphoria is often associated with severe depression and individuals could seek specified sex-trait modification procedures through unregulated and unofficial channels. As we have noted, pursuant to 1302(b)(2) of the ACA, EHB must be “equal to the scope of benefits provided under a typical employer plan”, and thus, not all benefits will fall under the definition of EHB. Just as States and issuers are not prohibited from covering specified sex-trait modification procedures as a non-EHB consistent with applicable State law, individuals have the ability to identify health care plans that provide coverage related to their conditions and health issues in an appropriate manner.

We also clarify that if an issuer were to voluntarily cover specified sex-trait modification procedures, as defined in this rule, as non-EHB, those services would not be subject to EHB protections such as the prohibition on discrimination at Sec. 156.125, the prohibition on annual and lifetime dollar limits at Sec. 147.126, and the requirement to accrue enrollee cost sharing towards the annual limitation on cost sharing at Sec. 156.130. We note that because the premium attributable to these procedures would not be for an EHB, the portion of the premium attributable to specified sex-trait modification procedures would not be eligible for PTC or CSR, and the enrollee would be responsible for the cost of any associated premium and cost sharing. Similarly, if a State were to mandate coverage of specified sex-trait modification procedures, those procedures would not be EHB, and not subject to the prohibition on discrimination or annual and lifetime dollar limits applicable to EHBs. However, in such a case, the State would bear the cost of the portion of premium attributable to these procedures, though the enrollee would still be responsible for any applicable cost sharing.

Comment: Several commenters expressed concern with the proposal being effective for PY 2026, citing concerns about interruption of care as well as Federal and State filing deadlines. They noted they believed that the effective date was too soon and would be disruptive to issuers' plan filings for PY 2026, since that process generally began prior to the publication and the effective date of this rule. One commenter noted that some States have an April 25, 2025 QHP application filing deadline for PY 2026, and many others have QHP application filing deadlines of May 15. Another commenter opined that EHB-benchmark plans for PY 2026 have already been finalized, and that any EHB- benchmark plans that include sex-trait modification should be permitted to keep those benefits as EHB for PY 2026. Some commenters explained that issuers will need to make changes to claims systems and utilization management policies and processes as a result of this policy, which takes time. Other commenters stated that such quick finalization for PY 2026 could create market instability and disproportionately affect smaller safety net plans that are predominantly community-based, and local issuers that primarily serve lower-income consumers. Some commenters suggested that the policy be effective for fiscal year 2026, as opposed to PY 2026. Others suggested delaying the effective date of the proposal until calendar year 2027 and one commenter suggested delaying the effective date until no earlier than PY 2028. As support for requesting a later effective date, some commenters noted that when States make updates to their EHB- benchmark plans under Sec. 156.111, States must submit their EHB- benchmark plan application 2 years in advance of the plan year for which the new EHB-benchmark plan will be effective.

Response: We are finalizing an effective date of PY 2026 for this policy. Although we acknowledge that issuers may need to alter their plan filings to ensure specified sex-trait modification procedures are either not covered at all or covered but as non-EHB, we believe this rule will be finalized with sufficient time for issuers to make such changes and ask that States permit changes to rate filings as appropriate to reflect such changes. Specifically, this rule will be finalized prior to the conclusion of QHP certification for PY 2026, such that we believe issuers will have time to adjust their plan offerings in accordance with this rule, regardless of the size, location, or resources of the issuer. We also reiterate that we do not believe issuers will be required to undergo complex system builds or process changes in order to implement this policy, as discussed in more detail above. We believe that finalizing this policy without delay, for PY 2026, is important to align issuer coverage of EHBs with section 1302 of the ACA. Additionally, we do not believe that this change is analogous to the changes States make to their EHB-benchmark plans (for which we require that changes are finalized well in advance of the applicable plan year). Rather, we believe that this change affects rarely utilized coverage, and will be uniformly applied across States, making this change easier for issuers to make for the upcoming plan year.

Comment: Many commenters presented a variety of legal arguments in support of their opposition to the proposal. Many commenters opposing the policy argued that the proposal violates the Supreme Court's holding in Bostock v. Clayton County, 590 U.S. 644 (2020), which held that discrimination based on transgender status constitutes sex discrimination under Title VII. Many commenters stated that this policy would violate Title IX and section 1557 which also prohibit discrimination on the basis of sex, and that the reasoning in Bostock has since been extended to Title IX and Section 1557 in a growing body of Federal case law holding that discrimination on the basis of gender identity and transgender status is prohibited sex discrimination. Many objecting commenters also stated the proposal would prohibit EHB coverage for a protected group on the basis of animus. Many commenters also raised that denying EHB coverage of sex-trait modification procedures such as hormone replacement therapy only to individuals with gender dysphoria

while permitting the exact same treatments to be covered as EHB for individuals without gender dysphoria is overtly discriminatory on the basis of sex in violation of section 1557 of the ACA. Many commenters further stated that the proposal discriminates on the basis of sex by reinforcing sex stereotypes and punishing gender nonconformity.

One commenter supporting the proposed policy stated it would not violate nondiscrimination requirements in the ACA or other applicable Federal nondiscrimination laws, because such laws do not support claims that exclusions for coverage of sex-trait modification are discriminatory.

Response: We disagree with comments questioning HHS's legal authority to make these policy changes. Section 1557 of the ACA prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities. We disagree that the policy in the proposed rule, and as revised in this final rule, constitutes sex discrimination in violation of section 1557 of the ACA. On May 6, 2024, we finalized the Nondiscrimination in Health Programs and Activities final rule, issued in the Federal Register on May 6, 2024 (“2024 Section 1557 final rule”) (89 FR 37522), which expanded the definition of prohibited discrimination on the basis of sex to include, inter alia, discrimination on the basis of sex characteristics, including intersex traits, gender identity, and sex stereotypes. Several district courts stayed or preliminarily enjoined HHS from enforcing certain portions of the 2024 Section 1557 final rule--primarily those prohibiting discrimination on the basis of gender identity. See Florida. v. Dep't of Health & Hum. Servs., 739 F. Supp. 3d 1091 (M.D. Fla. 2024); Tennessee v. Becerra, 739 F. Supp. 3d 467 (S.D. Miss. 2024); Texas v. Becerra, No. 6:24-CV-211-JDK, 2024 WL 4490621 (E.D. Tex. Aug. 30, 2024). Although the Secretary filed appeals in these cases, the United States Court of Appeals for the Fifth and Eleventh Circuits subsequently dismissed all appeals pursuant to motions filed after the change in administration, and HHS remains enjoined from enforcing the 2024 Section 1557 final rule's expanded interpretation of sex discrimination.\210\ According to the reasoning in these cases, section 1557 of the ACA does not create an obligation to provide or extend coverage to specified sex-trait modification procedures.\211\

\210\ In Florida v. Department of Health and Human Services, 739 F. Supp. 3d 1091 (M.D. Fla. 2024), the court stayed 45 CFR 92.101(a)(2)(iv), 92.206(b), 92.207(b)(3)-(5), and 42 CFR 438.3(d)(4), in Florida. OCR also may not enforce the interpretation of discrimination “on the basis of sex” in 45 CFR 92.101(a)(2)(iv), 92.206(b), or 92.207(b)(3)-(5) in Florida. In Tennessee v. Becerra, 739 F. Supp. 3d 467 (S.D. Miss. 2024), the court stayed nationwide the following regulations to the extent they “extend discrimination on the basis of sex to include discrimination on the basis of gender identity”: 42 CFR 438.3, 438.206, 440.262, 460.98, 460.112; 45 CFR 92.5, 92.6, 92.7, 92.8, 92.9, 92.10, 92.101, 92.206-211, 92.301, 92.303, 92.304; and enjoined HHS from enforcing the 2024 Section 1557 final rule “to the extent that the final rule provides that `sex' discrimination encompasses gender identity.” In Texas v. Becerra, No. 6:24-CV-211- JDK, 2024 WL 4490621 (E.D. Tex. Aug. 30, 2024), the court stayed nationwide the following regulations: 42 CFR 438.3(d)(4), 438.206(c)(2), 440.262, 460.98(b)(3), 460.112(a); 45 CFR 92.101(a)(2) (and all references to this subsection), 92.206(b), 92.207(b)(3)-(5).

\211\ Office of Women's Health (2025, Feb. 19). Sex-Based Definitions. Dep't of Health and Human Services. Retrieved March 6, 2025, from https://womenshealth.gov/article/sex-based-definitions.

We also disagree that this policy would violate the ruling in Bostock. The Supreme Court's holding in Bostock applied to discriminatory employment decisions under Title VII of the Civil Rights Act of 1964. We reject the notion that Bostock would have any bearing on the prohibition of coverage of sex-trait modification as an EHB. Such an application would be outside the scope of the Bostock decision. As the United States District Court for the Southern District of Mississippi stated in the order granting a preliminary injunction on enforcement of the 2024 Section 1557 final rule, “[T]he Court has found no basis for applying Bostock's Title VII analysis to section 1557's incorporation of Title IX. HHS acted unreasonably when it relied on Bostock's analysis in order to conflate the phrase `on the basis of sex' with the phrase `on the basis of gender identity.' Specifically, the Bostock holding did not `sweep beyond Title VII to other Federal or State laws that prohibit sex discrimination.' ”See Tennessee v. Becerra, 739 F. Supp. 3d 467, 482 (S.D. Miss. 2024). Further, the Supreme Court in Bostock made the intended limited application to Title VII claims clear when it stated, “[N]one of these other [sex discrimination] laws are before us; we have not had the benefit of adversarial testing about the meaning of their terms, and we do not prejudge any such question today . . .” See Bostock, 590 U.S. at 681, 140 S.Ct. 1731.

On June 18, 2025, the Supreme Court concluded that Bostock “does not alter our analysis” when they upheld a State ban on certain medical treatments for transgender minors.\212\ In Bostock, the Supreme Court specifically “held that an employer who fires an employee for being gay or transgender violates Title VII's prohibition on discharging an individual `because of” their sex” after “incorporat[ing] the traditional but-for causation standard” to determine but-for cause.\213\ Applying the Bostock reasoning to an example of a transgender boy who is restricted from receiving testosterone to treat gender dysphoria under the State law, the Supreme Court concluded “neither his sex nor his transgender status is the but-for cause of his inability to obtain testosterone.” \214\ Consistent with this conclusion, neither an individual's sex nor transgender status is the but-for cause of their inability to obtain certain sex trait modification procedures as an EHB. Therefore, we likewise conclude the Bostock reasoning does not apply here.\215\

\212\ United States v. Skrmetti et al., No. 23-477 slip op. at *18 (U.S. June 18, 2025).

\213\ Ibid.

\214\ Ibid. at *19.

\215\ The Supreme Court declined to rule on whether the Bostock reasoning applies outside the context of Title VII because, under the State law at issue in the case, neither a person's sex nor their transgender status would be the but-for cause of their inability to obtain the services banned under the law. Ibid.

Comment: Commenters opposing the proposal also argued that it violates the authority granted to the Secretary to define EHB under section 1302 of the ACA because the proposal does not take into account health needs of diverse segments of the population. One commenter stated that because gender dysphoria is recognized by experts as a disability, this policy would be directly contrary to the plain language and intent of the ACA to provide patient protection and access to care. Some opposing commenters also claimed that the proposal conflicts with the EHB nondiscrimination standards at Sec. 156.125 because the proposal creates discriminatory benefit designs that are not clinically based. Several commenters also stated that this proposal would violate Sec. 156.125 because it discriminates on the basis of sex characteristics, which includes but is not limited to intersex traits, pregnancy or related conditions, sexual orientation, gender identity, and sex stereotypes, which is prohibited under Sec. 156.125(b). Many commenters objecting to the proposal stated that prohibiting coverage as EHB for medical care for individuals with gender dysphoria, while expressly proposing to create exceptions to cover these same services for other indications, is discriminatory.

Many opposing commenters also expressed concern that the proposal is at odds with the State EHB benchmark approach at Sec. 156.111 which relies on

the States to address specific gaps in coverage affecting their populations. Some commenters also stated that the proposal exceeds the Secretary's EHB authority by imposing condition-based exclusions on health plans, providers, or enrollees. Many objecting commenters also stated it is unclear how Sec. 156.110, which requires that an EHB- benchmark plan provide coverage for mental health and substance use disorder services, does not conflict with the removal of sex-trait modification as EHB, since care for gender dysphoria falls under the definition of mental health and substance use disorder services in the most recent version of the Diagnostic and Statistical Manual of Mental Disorders.

Response: We disagree with commenters who stated that this policy violates EHB nondiscrimination rules at Sec. 156.125. That regulation applies only to services that are covered as EHB under a plan. As finalized at Sec. 156.115, specified sex-trait modification procedures will be prohibited from being covered as EHB. Therefore, the nondiscrimination requirements at Sec. 156.125 will not apply to such procedures.

We also disagree with commenters who stated that this policy violates section 1302(b)(4)(C) of the ACA, which requires that in defining the EHB the Secretary take into account the health care needs of diverse segments of the population, including women, children, persons with disabilities, and other groups. Section 1302(b)(2)(A) of the ACA requires the Secretary to ensure that the scope of EHB be equal in scope to the benefits provided under a typical employer plan. We read these provisions together so that they do not conflict with one another. Therefore, although the Secretary must take into account the health care needs of diverse segments of the population, the Secretary must only do so insofar as it does not conflict with the requirement that the scope of the EHB be equal to the scope of the benefits provided under a typical employer plan. Because specified sex-trait modification procedures are not typically covered by employer plans, specified sex-trait modification procedures are not among the benefits the Secretary is required to consider under section 1302(b)(4)(C) of the ACA.

Similarly, we disagree with commenters that asserted that the proposed policy would violate the State benchmark-based approach. Although this approach provides States with flexibility in determining which benefits will be EHB in the State, such flexibility is not without limitations. States selecting EHB-benchmark plans must do so in accordance with Sec. 156.111, which requires that the EHB-benchmark plan provide a scope of benefits equal to the scope of benefits provided under a typical employer plan. As explained, specified sex- trait modification procedures are not typically included in employer- sponsored plans. Therefore, this policy change aligns with the plain language and intent of section 1302 of the ACA.

We also disagree with commenters that the policy creates discriminatory circumstances under which individuals would be denied coverage of medical care for gender dysphoria as EHB, while others could receive the same services as EHB for other indications. This is not the case. We clarify that nothing in this rule prohibits issuers from providing coverage beyond the defined exceptions for specified sex-trait modification procedures as non-EHB.

We believe that the amendments we are finalizing to add a definition for specified sex-trait modification procedure at Sec. 156.400 resolve commenters' concerns that an EHB-benchmark plan provide coverage for mental health and substance use disorder services, as the finalized definition at Sec. 156.400 will permit non-pharmaceutical and non-surgical mental health and substance use disorder services to treat gender dysphoria to be covered as EHB.

Comment: Some commenters opposing the policy also argued that the proposal violates the Americans with Disabilities Act (ADA) and section 504 of the Rehabilitation Act. Commenters raising ADA concerns cited as support Williams v. Kincaid, 45 F.4th 759, 766-74 (4th Cir. 2022), which held that gender dysphoria is a covered disability for purposes of the ADA.

Response: We disagree with concerns that the policy violates the Americans with Disabilities Act or section 504 of the Rehabilitation Act; the final policy does not explicitly single out treatment for gender dysphoria or any particular medical condition for exclusion or prohibit any issuer's coverage of specified sex-trait modification procedures, but instead excludes specified sex-trait modification procedures from being covered as an EHB.

Comment: Many commenters opposing the proposal asserted that it violates the APA, with many of these commenters stating that the proposal is arbitrary and capricious because it fails to consider important facts, including the widespread coverage of sex-trait modification procedures by large employer-based health plans and the established clinical evidence that these services are medically necessary and considerably improve the lives and health outcomes for its recipients. Other commenters argued the proposal is an agency action that exceeds statutory authority in violation of the APA because the policy would discriminate on the basis of sex in violation of section 1557 of the ACA. Many commenters objecting to the proposal also stated that the proposal constitutes unlawful discrimination in violation of the Equal Protection Clause and several court opinions finding that medically unsupported exclusions of specific treatments for beneficiaries with gender dysphoria could constitute discrimination in violation of Federal law. Many opposing commenters raising Equal Protection Clause arguments noted that because they believe this policy discriminates against a protected class, the policy would trigger heightened scrutiny review, and stated that they believe HHS offers no legitimate justification showing that the proposal serves important governmental objectives or that the discriminatory means employed are substantially related to the achievement of those objectives. Such commenters argued that the justification provided--that sex-trait modification procedures are not typically included in employer- sponsored plans--lacks sufficient evidence or analysis and is readily disproven. These commenters also stated that the proposed rule suggested that part of the reasoning for the proposal is that the Secretary is concerned about the scientific integrity of claims made to support the use of sex-trait modification procedures in health care settings, but that the proposed rule did not cite any evidence to support this claim and, in failing to do so, cannot articulate a satisfactory explanation for its action.

One commenter supporting the proposal asserted that whether gender identity qualifies as a protected class under the Equal Protection Clause is not settled law. The commenter also argued that, even if it were a protected class, the proposed policy would not need to survive heightened constitutional scrutiny if reviewed by courts. As support, this commenter cited to the Supreme Court's decision in Geduldig v. Aiello, 417 U.S. 484 (1974), which found that “[t]he regulation of a medical procedure” specific to a protected class “does not trigger heightened constitutional scrutiny” absent “invidious discrimination.” This commenter also stated that the proposed policy lacks invidious discrimination

because the proposed change is required by law as most employer health plans do not cover sex-trait modifications.

Another commenter objecting to the proposal noted that the proposal conflicts with State law, because according to the commenter, half of all States have interpreted their State health laws to bar discrimination against people with gender dysphoria. Commenters objecting to the proposal also raised Federalism concerns, noting that the proposal goes against the premise that States determine the best way to enable and regulate health insurance within their borders. Commenters also raised concerns that the proposal contravenes section 1554 of the ACA, which prohibits the Secretary from promulgating a regulation that “creates any unreasonable barriers to the ability of individuals to obtain appropriate medical care.” One commenter explained it would violate section 1554 of the ACA because prohibiting coverage of sex-trait modification procedures as EHB in turn means removing important EHB protections for such services, such as requiring cost-sharing for EHBs to accrue towards the annual limitation on cost sharing and prohibitions on annual and lifetime dollar limits on EHBs.

Response: We disagree that the policy would violate the Equal Protection Clause, which provides that no State shall “deny to any person within its jurisdiction the equal protection of the laws,” because the policy applies equally to coverage for all persons, including both sexes. The policy also does not discriminate on the basis of transgender status, because it turns on the purpose and effect of the procedures at issue, not the status of the patient. Moreover, transgender persons do not exhibit “obvious, immutable, or distinguishing characteristics that define them as a discrete group” sufficient to make them a protected class under the Supreme Court's equal protection jurisprudence. Bowen v. Gilliard, 483 U.S. 587, 602 (1987). Additionally, on June 18, 2025, the Supreme Court upheld a State's ban on the provision of puberty blockers and hormones for minors to treat gender dysphoria, gender identity disorder, or gender incongruence for minors, concluding that the ban did not violate the Equal Protection Clause because the State only prohibited healthcare providers from administering puberty blockers or hormones to minors for certain medical uses, regardless of a minor's sex.\216\ In any event, the policy would pass constitutional muster even under heightened equal protection scrutiny because it serves the important governmental interest of complying with the law governing the scope of EHBs under the ACA and is substantially related to achievement of that objective. The Department also agrees that the law is far from settled with regard to whether persons diagnosed with gender dysphoria or other identity- related conditions fit within the class of persons protected from discrimination under the Equal Protection Clause.

\216\ See United States v. Skrmetti et al., No. 23-477 slip op. at *10 (U.S. June 18, 2025), available at https://www.supremecourt.gov/opinions/24pdf/23-477_2cp3.pdf.

In response to comments arguing this policy violates conflicting State laws, we note that the policy we are finalizing does not prohibit health plans from voluntarily covering specified sex-trait modification procedures as non-EHB consistent with applicable State law, nor does it prohibit States from requiring the coverage of specified sex-trait modification procedures, subject to the rules related to State-mandated benefits at Sec. 155.170. Likewise, we disagree with commenters' assertions that this policy would violate section 1554 of the ACA which prohibits the Secretary from promulgating a regulation that “creates any unreasonable barriers to the ability of individuals to obtain appropriate medical care,” as the finalized policy only prohibits coverage for specified sex-trait modification procedures as EHB but otherwise permits such coverage to continue, so long as it is not EHB.

In response to comments suggesting that part of the reasoning for the proposal is that the Secretary is concerned about the scientific integrity of claims made to support the use of sex-trait modification procedures in health care settings but that the proposed rule did not cite any evidence to support this concern, we note that concern about the scientific integrity of claims made to support the use of specified sex-trait modification procedures in health care settings supports our rationale that specific sex-trait modification procedures are not typically covered under employer-sponsored plans. As we stated and reiterated in the proposed rule and earlier in this final rule, specified sex-trait modification procedures are not typically included in employer-sponsored plans, which is an independent, legally- sufficient basis for adoption of this policy.

For the reasons cited in a previous response to comments addressing section 1557 of the ACA, we disagree with commenters that the policy proposed in the proposed rule, and as revised in this final rule, exceeds statutory authority in violation of the APA because it constitutes sex discrimination in violation of section 1557 of the ACA. We refer readers to our discussion of section 1557 of the ACA in the respective response above.

Further, commenter concerns regarding Federalism or the APA are misguided. The ACA expressly authorizes and provides broad flexibility to the Secretary to define the EHB under section 1302 of the ACA. While the ACA outlines 10 general categories that EHBs must include, the Secretary has the authority to determine the specific services and items within those categories. As discussed elsewhere in this final rule, there is ample data suggesting that the specified sex-trait modification procedures, as defined in this rule, are not benefits covered under a typical employer plan. Therefore, we disagree that this policy, as finalized, is arbitrary and capricious and exceeds statutory authority in violation of the APA.

Comment: Many commenters opposing the proposal also stated that the proposal conflicts with the preliminary injunctions on the executive orders cited in support of the proposal in the proposed rule (E.O. 14168 and E.O. 14187). Some commenters objecting to the policy stated it is premature in light of ongoing litigation and urged CMS to postpone consideration of finalizing this policy until the various lawsuits enjoining application of the executive orders are resolved. Another opposing commenter stated that E.O. 14187 is limited to sex- trait modification procedures for minors, whereas the proposal applies more broadly to both minors and adults. Two commenters supportive of the proposal stated that they do not believe the existing injunctions on the executive orders should preclude finalizing this policy as proposed, with one commenter noting that the proposal does not rely on the enjoined executive orders but also arguing that the injunctions rely on incorrect legal reasoning. One commenter noted support for the proposal because they noted it protects the rights of employers and enrollees who object to covering services or paying premiums that violate their deeply held religious or moral beliefs.

Response: We agree with commenters supporting the proposed policy in spite of the injunctions on the executive orders. As we stated in the proposed rule (90 FR 12986), we made this proposal independently of the executive orders because specified sex-trait modification procedures are not typically included in employer health plans and therefore cannot legally be covered as EHB. We acknowledge that two courts have issued preliminary injunctions relating to the E.Os described above, and we do not rely on the enjoined sections of the executive orders in making this proposal. The finalized policy does not conflict with those preliminary injunctions because, among other things, it is based on independent legal authority and reasons and not the enjoined sections of the executive orders. Further, this policy as finalized will not be effective until PY 2026, and will not be implemented, made effective, or enforced in contravention of any court orders.\217\

\217\ HHS intends to notify the courts in both cases about this Rule after it has been published in the Federal Register.

Comment: Numerous commenters opposed the proposal on the basis that it would lead to adverse mental health outcomes and increase suicide risk, though commenters both for and against the proposal universally supported mental health treatment for gender dysphoria. Many commenters who did not support the proposal noted that medical evidence indicates lack of access to services for sex-trait modification procedures, and especially hormone therapy, will lead to an overall increase in suicidality and self-harm and create or exacerbate mental health conditions. Many commenters noted that people with gender dysphoria and other identity-related conditions experience higher rates of violence, discrimination, and harassment, which often compounds mental health symptoms. One commenter expressed concern that their treatment would be stopped midstream if the proposal were finalized, and that this would put them at continued risk of violence.

Numerous commenters opposing the proposal also argued that, due to discrimination and stigma, suicide rates are four times higher for individuals with gender dysphoria than the general population, with one commenter stating this rate is even higher among people of color with gender dysphoria. Commenters stated this proposal would result in the denial of medically necessary care that has proven associations with lowering suicidal ideation and that denial of this care would subsequently lead to worse mental health outcomes for persons with gender dysphoria, including higher rates of depression, anxiety, suicide, and suicidal ideation. These commenters cited to multiple studies demonstrating that access to sex-trait modification procedures is associated with lower odds in both children and adults of depression, self-harm, and suicidal thoughts compared to individuals not receiving these services. Commenters opposing the proposal noted particular concern with the mental health impact of this proposal on youth with gender dysphoria.

Commenters opposing the proposal also expressed concern that inability to access certain care as a result of the proposal would exacerbate other conditions. One commenter opposing the proposal stated this would be particularly true for health care services that require risk assessment or consistent engagement with a provider. For example, this commenter noted that receiving a prescription for hormone therapy for sex-trait modification is associated with lower rates of acquiring HIV and increased rates of HIV viral suppression among patients with gender dysphoria and that limiting access to sex-trait modification services for Exchange enrollees will only exacerbate the HIV epidemic given the disproportionate impact of HIV among individuals with gender dysphoria. Other commenters opposing the proposal noted specific concerns regarding increased substance use in the absence of access to sex-trait modification procedures, as substance use may be used as a coping mechanism.

One commenter that supported the proposal stated that although deaths by suicide are higher than average among the population of persons with gender dysphoria there is no evidence supporting the claim that sex-trait modification procedures reduce this risk. One commenter supporting the proposal stated that there is no scientifically valid evidence that suicide risk among persons with gender dysphoria increases in the absence of sex-trait modification and that puberty blockers are associated with depression. This commenter stated that transition may exacerbate psychological distress, which could lead to suicide, and that persons with gender dysphoria would benefit from mental health services shown to be useful in treating other body dysphoria disorders such as anorexia nervosa, as well as counseling or other treatment for depression and anxiety.

Response: The Department agrees with commenters that mental health services are a critical part of treating gender dysphoria, and we are committed to improving the quality of, and access to, mental health care services.\218\ As discussed earlier in this final rule, mental health services will continue to be covered as an EHB as required by section 1302(b)(1)(E) of the ACA, including for those who seek or undergo specified sex-trait modification procedures or are diagnosed with gender dysphoria. We note that the definition of “specified sex- trait modification procedure” we adopt in this rule places no prohibition on coverage of mental health services as EHB. Specifically, the definition neither prohibits coverage for mental health treatment for specific conditions as EHB (for example, for mental health treatment for gender dysphoria), nor prohibits coverage for mental health treatment for any specific populations as EHB (for example, mental health treatment for consumers with gender dysphoria).

\218\ Behavioral Health, CTRS. FOR MEDICARE & MEDICAID SERVS., https://www.cms.gov/about-cms/what-we-do/behavioral-health (last visited May 13, 2025).

Comment: Several commenters opposing the proposal also raised concerns that the proposal would conflict with the Mental Health Parity and Addiction Equity Act (MHPAEA). One such commenter stated that the prohibition of coverage for sex-trait modification is contrary to the MHPAEA prohibition on group health plans and health insurance issuers from imposing less favorable benefit limitations on mental health and substance abuse benefits as compared to medical/surgical benefits, as gender dysphoria is a mental health condition defined in the Diagnostic and Statistical Manual of Mental Disorders (DSM-5-TR) as a serious medical condition characterized by distress due to incongruence between the patient's gender identity (that is, the innate sense of one's own gender) and sex. These commenters noted concern that complying with this proposal would put group health plans and issuers out of compliance with MHPAEA.

Response: On May 15, 2025, the Departments of Labor, HHS, and the Treasury (the Departments) announced that the Departments will not enforce the September 23, 2024 final rule “Requirements Related to the Mental Health Parity and Addiction Equity Act,” 89 FR 77586 (2024 MHPAEA Final Rule) or otherwise pursue enforcement actions based on a failure

to comply with the 2024 MHPAEA Final Rule that occur prior to a final decision in ongoing litigation regarding the 2024 MHPAEA Final Rule, plus an additional 18 months.\219\ The Departments also announced their intention to reconsider the 2024 MHPAEA Final Rule, including whether to issue a notice of proposed rulemaking rescinding or modifying the regulation through notice and comment rulemaking. Further, the Departments announced that they will undertake a broader reexamination of each Department's respective enforcement approach under MHPAEA. Nothing in this final rule prevents a plan or issuer from providing benefits for treatment for gender dysphoria; the benefits simply would not be considered EHB if they fall under the definition of specified sex-trait modification procedures we are finalizing at Sec. 156.400. Additionally, we reiterate that the definition of “specified sex-trait modification procedure” neither prohibits coverage for mental health treatment for specific conditions as EHB (for example, for mental health treatment for gender dysphoria), nor prohibits coverage for mental health treatment for any specific populations as EHB (for example, mental health treatment for consumers with gender dysphoria).

\219\ Statement of U.S. Departments of Labor, Health and Human Services, and the Treasury regarding enforcement of the final rule on requirements related to the Mental Health Parity and Addiction Equity Act, May 15, 2025, available at https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/mental-health-parity/statement-regarding-enforcement-of-the-final-rule-on-requirements-related-to-mhpaea.

Comment: Many commenters objected to the proposal in general or did not state a basis for the objection. Some commenters stated that the proposal is motivated by animus against transgender-identified people and intended to cause harm to a specific group of people and others stated that the proposal would target individuals already at significantly higher risk for negative health and mental health outcomes. Some commenters stated they believed that the proposal is contrary to HHS' role in protecting the vulnerable, the Make America Healthy Again movement, and pro-life beliefs given the increased risk of suicide among persons with gender dysphoria. Other commenters opined that the proposal creates a double standard through which persons without gender dysphoria may continue to receive sex-trait modification services as EHB but persons with gender dysphoria cannot. Several commenters opined that a prohibition on coverage of sex-trait modification services as EHB is tantamount to eugenics or genocide and a crime against humanity. Other commenters stated that if the proposed rule were finalized as proposed, it would have downstream psychological effects on the friends and family of persons with gender dysphoria who had been seeking sex-trait modification services. Some comments were out of the scope of this rule.

Response: We share commenters' concern for vulnerable groups and individuals. However, we disagree with commenters that prohibiting coverage of specified sex-trait modification procedures as EHB is discriminatory or will be damaging to the health and wellbeing of the nation. Specifically, we disagree with commenters that finalization of the proposal would mean persons without gender dysphoria will have access to specified sex-trait modification procedures while persons with gender dysphoria will not. All people will be able to access covered items and services as EHB, so long as the items and services do not meet the definition of “specified sex-trait modification procedures,” in that they are not, in a given instance, surgical or pharmaceutical interventions being provided for the purpose of attempting to align an individual's physical appearance or body with an asserted identity that differs from the individual's sex, or they otherwise fall within an exception. Additionally, we emphasize that we are not prohibiting any consumers from accessing specified sex-trait modification procedures when paid for out of pocket, or prohibiting issuers on the Exchanges from providing coverage for such services as non-EHB. We are only prohibiting the coverage of specified sex-trait modification procedures specifically as EHB, given that they are not within the scope of benefits provided by a typical employer plan, as directed in statute. 2. Premium Adjustment Percentage (Sec. 156.130(e))

In the 2025 Marketplace Integrity and Affordability proposed rule (90 FR 12987 through 12995), we proposed to update the premium adjustment percentage methodology to establish a premium growth measure that captures premium changes in the individual market in addition to ESI premiums for PY 2026 and beyond. In addition, based on this proposed updated methodology, we proposed values for the PY 2026 premium adjustment percentage, maximum annual limitation on cost sharing, reduced maximum annual limitations on cost sharing, and required contribution percentage.

Section 1302(c)(4) of the ACA directs the Secretary to determine an annual premium adjustment percentage, the measure of premium growth that is used to set the rate of increase for the following three parameters: (1) the maximum annual limitation on cost sharing (defined at Sec. 156.130(a)); (2) the required contribution percentage used to determine eligibility for certain exemptions under section 5000A of the Code (defined at Sec. 155.605(d)(2)(iii)); and (3) the employer shared responsibility payment amounts under section 4980H(a) and (b) of the Code (see section 4980H(c)(5) of the Code). Section 1302(c)(4) of the ACA and Sec. 156.130(e) provide that the premium adjustment percentage is the percentage (if any) by which the average per capita premium for health insurance coverage for the preceding calendar year exceeds such average per capita premium for health insurance for 2013.

The 2015 Payment Notice (79 FR 13744) and 2015 Market Standards Rule (79 FR 30240) established a methodology for estimating the average per capita premium for purposes of calculating the premium adjustment percentage for PY 2015 and beyond. Beginning with PY 2015, the premium adjustment percentage was calculated based on the estimates and projections of average per enrollee ESI premiums from the NHEA, which are calculated by the CMS Office of the Actuary. In the 2015 Payment Notice proposed rule (78 FR 72359 through 72361), we proposed that the premium adjustment percentage be calculated based on the projections of average per enrollee private health insurance premiums from the NHEA. Based on comments received, we finalized in the 2015 Payment Notice (79 FR 13801 through 13804) use of per enrollee ESI premiums from the NHEA in the premium adjustment percentage methodology. We finalized use of per enrollee ESI premiums because these premiums reflected trends in health care costs without being skewed by individual market premium fluctuations resulting from the early years of implementation of the ACA market rules. However, recognizing that ESI premiums did not comprehensively reflect premiums for the entire market, we noted in the 2015 Payment Notice (79 FR 13801 through 13804) that we may change our methodology after the initial years of implementation of the market rules, once the premium trend is more stable.

In the 2020 Payment Notice proposed rule (84 FR 285 through 289), we noted that we believed the premium trend in the individual market had stabilized and, therefore, proposed to change the

premium adjustment percentage methodology to comprehensively reflect premium changes across all affected markets as we had suggested in the 2015 Payment Notice (79 FR 13801 through 13804). As such, in the 2020 Payment Notice (84 FR 17537 through 17541), we finalized the use of per enrollee private health insurance premiums from the NHEA (excluding Medigap and property and casualty insurance) in the premium adjustment percentage calculation.

In the 2022 Payment Notice proposed rule (85 FR 78633 through 78635), we proposed a premium adjustment percentage using the methodology adopted in the 2020 Payment Notice (84 FR 17537 through 17541). In addition, we proposed to amend Sec. 156.130(e) to, beginning with PY 2023, set the premium adjustment percentage in guidance separate from the annual notice of benefit and payment parameters, unless we were to propose a change to the methodology for calculating the parameters, in which case, we would do so through notice-and-comment rulemaking. We finalized this latter proposal (the amendment to Sec. 156.130(e)) in part 2 of the 2022 Payment Notice (86 FR 24237 through 24238). Although we did not propose to change the methodology for calculating the premium adjustment percentage in the 2022 Payment Notice proposed rule (85 FR 78633 through 78635), we finalized a new methodology in part 2 of the 2022 Payment Notice (86 FR 24233 through 24237) that readopted the measure of premium growth for PY 2022 and beyond using the NHEA projections of average per enrollee ESI premium in response to comments requesting that we revert to the use of the NHEA ESI premium measure to estimate premium growth, which was the methodology used for PY 2015 through PY 2019. We finalized this change after concluding it was consistent with the will and interest of interested parties and would mitigate the uncertainty regarding premium growth during the COVID-19 PHE.

Because the COVID-19 PHE has ended and should no longer impact the premium adjustment percentage, and because evidence described in the proposed rule now suggests that the COVID-19 PHE did not impact premiums as we anticipated in part 2 of the 2022 Payment Notice (86 FR 24233 through 24237), in the proposed rule (90 FR 12987 through 12993), we proposed to revert to the methodology for calculating the premium adjustment percentage that we established in the 2020 Payment Notice (84 FR 17537 through 17541). Specifically, we proposed to calculate the premium adjustment percentage for PY 2026 and beyond using an adjusted private individual and group market health insurance premium measure, which is similar to NHEA's private health insurance premium measure.\220\ NHEA's private health insurance premium measure includes premiums for ESI, “direct purchase insurance,” which includes individual market health insurance purchased directly by consumers from health insurance issuers, both on and off the Exchanges, Medigap insurance, and the medical portion of accident insurance (“property and casualty” insurance). The measure we proposed to use includes NHEA estimates and projections of ESI and direct purchase insurance premiums but would exclude premiums for Medigap and property and casualty insurance (we refer to the proposed measure as “private health insurance (excluding Medigap and property and casualty insurance),”) consistent with the approach finalized in the 2020 Payment Notice (84 FR 17537 through 17541).

\220\ See Table 17 of the “NHE Projections--Tables (ZIP)” link available at https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/projected.

We proposed to exclude Medigap and property and casualty insurance from the premium measure since these types of coverage are not considered primary medical coverage for individuals who elect to enroll.\221\ For example, Medigap coverage supplements Original Medicare \222\ coverage by helping to pay certain out-of-pocket costs not covered by Original Medicare such as co-payments, coinsurance, and deductibles. Specifically, we stated in the proposed rule that to calculate the premium adjustment percentage for PY 2026, the measures for 2013 and 2025 would be calculated as private health insurance premiums minus premiums paid for Medigap insurance and property and casualty insurance, divided by the unrounded number of unique private health insurance enrollees with comprehensive coverage (that is, excluding supplemental coverage such as Medigap and property and casualty insurance from the count of enrollees in the denominator). We stated that these results would then be rounded to the nearest $1 followed by a division of the 2025 figure by the 2013 figure rounded to 10 significant digits. We explained that the proposed premium measure would reflect cumulative, historic growth in premiums for private health insurance markets (excluding Medigap and property and casualty insurance) from 2013 onwards.

\221\ Section 1302(c)(4) of the ACA refers to “the average per capita premium for health insurance coverage in the United States.” The term “health insurance coverage” is defined in 42 U.S.C. 300gg-91(b)(1) as “benefits consisting of medical care (provided directly, through insurance or reimbursement, or otherwise and including items and services paid for as medical care) under any hospital or medical service policy or certificate, hospital or medical service plan contract, or health maintenance organization contract offered by a health insurance issuer.”

\222\ Original Medicare includes Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) and covers services such as inpatient hospital care, outpatient services and office visits, tests, and preventive services. See, for example, CMS. (n.d.). What Original Medicare Covers. https://www.medicare.gov/providers-services/original-medicare.

In addition to the proposal to use the private health insurance premium measure data (excluding Medigap and property and casualty insurance) to measure premium growth for the PY 2026 and beyond, in the proposed rule (90 FR 12991 through 12992), we also proposed the premium adjustment percentage value for PY 2026. Specifically, we proposed that the premium adjustment percentage for PY 2026 be the percentage (if any) by which the most recent NHEA projection of per enrollee premiums for private health insurance (excluding Medigap and property and casualty insurance) for 2025 ($7,885) exceeds the most recent NHEA estimate of per enrollee premiums for private health insurance (excluding Medigap and property and casualty insurance) for 2013 ($4,714).\223\ Using this formula, in the proposed rule (90 FR 12992), we proposed a premium adjustment percentage for 2026 of 1.6726771319 ($7,885/$4,714). We stated in the proposed rule that this would represent an increase in private health insurance premiums (excluding Medigap and property and casualty insurance) of approximately 67.3 percent over the period from 2013 to 2025 and would reflect an overall growth rate for this period that is approximately 7.2 percentage points higher than the overall growth rate reflected by the previously published

PY 2026 premium adjustment percentage (1.6002042901).\224\

\223\ The 2013 and 2025 premiums used for this calculation reflect the latest NHEA data. The series used in the determinations of the adjustment percentages can be found in Tables 1 and 17 on the CMS website, which can be accessed by clicking the “NHE Projections 2023-2032--Tables” link located in the Downloads section at https://www.cms.gov/data-research/statistics-trends-and-reports/national-health-expenditure-data/projected. A detailed description of the NHE projection methodology is available at CMS. (2024, June 12). Projections of National Health Expenditures and Health Insurance Enrollment: Methodology and Model Specification. https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/downloads/projectionsmethodology.pdf.

\224\ See CMS. (2024, Oct. 8). Premium Adjustment Percentage, Maximum Annual Limitation on Cost Sharing, Reduced Maximum Annual Limitation on Cost Sharing, and Required Contribution Percentage for the 2026 Benefit Year. https://www.cms.gov/files/document/2026-papi-parameters-guidance-2024-10-08.pdf.

We refer readers to the proposed rule (90 FR 12987 through 12997) for a more detailed discussion of our proposed methodology, including further information regarding the background, rationale, and expected impacts of this proposal.

Based on the proposed PY 2026 premium adjustment percentage, we proposed the cost-sharing parameters for PY 2026, including the maximum annual limitation on cost sharing, the reduced maximum annual limitations on cost sharing, and the required contribution percentage as further described in the following subsections. a. Maximum Annual Limitation on Cost Sharing for PY 2026

Under Sec. 156.130(a)(2)(i), for PY 2026, cost sharing for self- only coverage may not exceed the dollar limit for calendar year 2014 increased by an amount equal to the product of that amount and the premium adjustment percentage for PY 2026. Under Sec. 156.130(a)(2)(ii), for other than self-only coverage, the limit is twice the dollar limit for self-only coverage. Under Sec. 156.130(d), these amounts must be rounded down to the next lowest multiple of $50. Using the proposed premium adjustment percentage of 1.6726771319 for PY 2026, and the 2014 maximum annual limitation on cost sharing of $6,350 for self-only coverage, which was published by the IRS on May 2, 2013,\225\ in the proposed rule (90 FR 12993), we proposed that the PY 2026 maximum annual limitation on cost sharing would be $10,600 for self-only coverage and $21,200 for other than self-only coverage. We stated in the proposed rule that this represents approximately a 15.2 percent increase from the PY 2025 parameters of $9,200 for self-only coverage and $18,400 for other than self-only coverage, and approximately a 4.4 percent increase from the previously published PY 2026 parameters of $10,150 for self-only coverage and $20,300 for other than self-only coverage.\226\

\225\ See IRS. (n.d.) Rev. Proc. 2013-25. Dep't of Treasury. http://www.irs.gov/pub/irs-drop/rp-13-25.pdf.

\226\ CMS. (2024, Oct. 8). Premium Adjustment Percentage, Maximum Annual Limitation on Cost Sharing, Reduced Maximum Annual Limitation on Cost Sharing, and Required Contribution Percentage for the 2026 Benefit Year. https://www.cms.gov/files/document/2026-papi-parameters-guidance-2024-10-08.pdf.

The reduced maximum annual limitations on cost sharing for cost- sharing plan variations are determined using the methodology we established in the 2014 Payment Notice (78 FR 15410). In the 2014 Payment Notice, we established standards related to the provision of these cost-sharing reductions (CSRs). Specifically, in 45 CFR part 156, subpart E, we specified that QHP issuers must provide CSRs by developing plan variations, which are separate cost-sharing structures for each eligibility category that change how the cost sharing required under the QHP is to be shared between the enrollee and the Federal Government.\227\ At Sec. 156.420(a), we detailed the structure of these plan variations and specified that QHP issuers must ensure that each silver plan variation has an annual limitation on cost sharing no greater than the applicable reduced maximum annual limitation on cost sharing specified in the annual HHS guidance or HHS notice of benefit and payment parameters. We noted in the proposed rule (90 FR 12993) that although the amount of the reduction in the maximum annual limitation on cost sharing is specified in section 1402(c)(1)(A) of the ACA, section 1402(c)(1)(B)(ii) of the ACA states that the Secretary may adjust the cost sharing limits to ensure that the resulting limits do not cause the AV of the health plans to exceed the levels specified in section 1402(c)(1)(B)(i) of the ACA (that is, 70 percent, 73 percent, 87 percent, or 94 percent, depending on the income of the enrollee).

\227\ On October 12, 2017, the Attorney General issued a legal opinion that HHS did not have a Congressional appropriation with which to make CSR payments. Sessions III, J. (2017, Oct. 11). Legal Opinion Re: Payments to Issuers for Cost-Sharing Reductions (CSRs). Office of Attorney General. https://www.hhs.gov/sites/default/files/csr-payment-memo.pdf.

As indicated in Table 8 of the proposed rule (90 FR 12994), we proposed the values of the PY 2026 reduced maximum annual limitation on cost sharing for self-only coverage at $3,500 for enrollees with household income greater than or equal to 100 percent of the FPL and less than or equal to 150 percent of the FPL, $3,500 for enrollees with household income greater than 150 percent of the FPL and less than or equal to 200 percent of the FPL, and $8,450 for enrollees with household income greater than 200 and less than or equal to 250 percent of the FPL, as calculated using the proposed PY 2026 premium adjustment percentage and proposed PY 2026 maximum annual limitation on cost sharing. We stated that these proposed values reflect 4.3 to 4.5 percent increases relative to the previously published PY 2026 parameters.\228\

\228\ See CMS. (2024, Oct. 8). Premium Adjustment Percentage, Maximum Annual Limitation on Cost Sharing, Reduced Maximum Annual Limitation on Cost Sharing, and Required Contribution Percentage for the 2026 Benefit Year. https://www.cms.gov/files/document/2026-papi-parameters-guidance-2024-10-08.pdf.

We refer readers to the proposed rule (90 FR 12993 through 12995) for a more detailed discussion of the proposed values of the PY 2026 reduced maximum annual limitation on cost sharing, including further information regarding the background, rationale, and expected impacts of these proposed values. Table 5 outlines the final values for the PY 2026 reduced maximum annual limitation on cost sharing, as calculated using the final PY 2026 premium adjustment percentage and final PY 2026 maximum annual limitation on cost sharing.

Table 5--Final Reductions in Maximum Annual Limitation on Cost Sharing

for PY 2026

Reduced maximum Reduced maximum

annual limitation annual limitation

on cost sharing on cost sharing

Eligibility category for self-only for other than

coverage for BY self-only coverage

2026 for BY 2026

Silver 94% AV * CSR Plan $3,500 $7,000

Variant: Individuals eligible

for CSRs under Sec.

155.305(g)(2)(i) (household

income greater than or equal to

100 and less than or equal to

150 percent of the FPL)........

Silver 87% AV * CSR Plan 3,500 7,000

Variant: Individuals eligible

for CSRs under Sec.

155.305(g)(2)(ii) (household

income greater than 150 and

less than or equal to 200

percent of the FPL)............ Silver 73% AV * CSR Plan 8,450 16,900

Variant: Individuals eligible

for CSRs under Sec.

155.305(g)(2)(iii) (household

income greater than 200 and

less than or equal to 250

percent of the FPL)............

* Under section 1402(d) of the ACA, American Indian/Alaska Native (AI/

AN) enrollees with incomes under 300 percent of the FPL are eligible

for Zero Cost Sharing plan variants. Additionally, all AI/AN QHP

enrollees are eligible for no cost sharing for items and services

provided by the Indian Health Service, an Indian Tribe, Tribal

Organization, or Urban Indian Organization or through referral under

contract health services. Under Sec. 155.305(g)(1)(ii), all other

enrollees must be enrolled in a silver plan variant to be eligible for

CSRs.