Exclusion For Gender Reassignment Surgery May Violate Title VII And The Equal Protection Clause

Seyfarth Synopsis: On December 23, 2019, District Judge Rosemary Marquez ruled, in connection with a motion to dismiss, that Title VII does protect discrimination based on a person's transgender status, and that a health insurance plan's exclusion for gender reassignment surgery may not be "rationally related to a legitimate government interest."

As we previously blogged, Plaintiff Russell Toomey, a transgendered male, filed suit in early 2019 against his employer, the State of Arizona, after the self-funded health plan provided by the State of Arizona denied Toomey's request for medical preauthorization for a total hysterectomy. The Plan generally provides coverage for "medically necessary care", and Toomey's doctors contended that the hysterectomy was medically necessary, but the Plan denied authorization under an exclusion for "gender reassignment surgery."

Toomey's complaint contends that the Plan's denial of authorization for a hysterectomy was sex discrimination under Title VII and a violation of the Equal Protection Clause. In March 2019, the State of Arizona and two individually named defendants employed by the State of Arizona filed a motion to dismiss Toomey's complaint.

Magistrate Judge Bowman issued her Report and Recommendation on the motion to dismiss on June 24, 2019. Judge Bowman determined that Title VII does not prohibit discrimination based on a person's transgender status. However, she decided that Toomey had adequately alleged that the health plan exclusion for gender reassignment surgery disadvantaged a "suspect class", justifying a heightened level of scrutiny, and that defendants had failed to argue that the exclusion would survive this level of scrutiny.

The parties filed Objections to the Report and Recommendation and District Judge Rosemary Vasquez held oral argument on October 2, 2019. After consideration of the Report and Recommendation, and the parties' objections and oral argument, Judge Vazquez issued an order denying the motion to dismiss on December 23, 2019.

Judge Vazquez disagreed with Judge Bowman's recommendation...