# "It's an effective ban": A New Hampshire judge weighs pausing Trump's Medicaid rule on gender care for minors

Four transgender teens say the federal funding cutoff has already interrupted their care. The government says it only decides what taxpayers pay for.

By 567 Politics staff · 567politics
Published: 2026-11-09T12:18:52.698353Z
Updated: 2026-11-09T12:19:39.422416Z
Canonical: https://567politics.com/news/goe-v-hhs-medicaid-gender-care-rule-new-hampshire-mcauliffe-november-2026

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A federal judge in New Hampshire is weighing whether to pause a Trump administration rule that ended federal Medicaid and Children's Health Insurance Program (CHIP) payments for puberty blockers, cross-sex hormones and related surgeries for minors. Four transgender teenagers and their families say the rule, which took effect October 13, has already interrupted care their doctors prescribed. The government says the rule only decides what federal taxpayers fund. At an October 30 hearing reported on November 9 by the [New Hampshire Bulletin](https://newhampshirebulletin.com/2026/11/09/nh-trans-teens-ask-federal-judge-to-pause-rule-banning-medicaid-funded-gender-affirming-care/), U.S. District Judge Steven McAuliffe pressed both sides hard, calling the rule "an effective ban" while also doubting the families' central legal theory.

The case, *Goe v. U.S. Department of Health and Human Services*, is one of the first direct court tests of the rule. Its outcome could shape whether low-income families in states that still allow this care can get it through Medicaid.

## What the rule does

The Centers for Medicare & Medicaid Services (CMS) published the final rule in the [Federal Register on August 13, 2026](https://www.federalregister.gov/documents/2026/08/13/2026-16508/medicaid-program-prohibition-on-federal-medicaid-and-childrens-health-insurance-program-funding-for). It requires state Medicaid plans to stop paying for what the rule calls "sex-rejecting procedures" for children under 18, and separate CHIP plans to stop paying for them for children under 19. It bars the use of federal Medicaid and CHIP dollars for those services. The rule's term is the administration's own; medical groups that support this care generally call it gender-affirming care, and this article uses neutral descriptions of the treatments where possible.

The rule does not stop states from paying with their own money, outside the federally matched program, and it does not affect private insurance. It also leaves mental health coverage in place. Under the rule, children already on hormone therapy can receive federally funded medication for a tapering period of up to six months. Puberty blockers are excluded from that tapering provision. CMS's [August 11 announcement](https://www.cms.gov/newsroom/press-releases/cms-ends-federal-medicaid-chip-funding-sex-rejecting-procedures-children-youth) said the rule follows an HHS review that "identified significant evidence gaps" and "documented serious safety concerns."

The rule's own regulatory impact analysis estimates small budget effects. It projects that total Medicaid and CHIP spending will fall by $235 million over 10 years, in real 2027 dollars, with the reduction split between federal and state budgets.

```chart
type: column
title: Projected 10-year spending reduction from the CMS rule
source: [CMS final rule, regulatory impact analysis, Federal Register, Aug. 13, 2026](https://www.federalregister.gov/documents/2026/08/13/2026-16508/medicaid-program-prohibition-on-federal-medicaid-and-childrens-health-insurance-program-funding-for)
note: Millions of real 2027 dollars over 10 years. CMS says actual impacts may vary. It did not revise the estimate for possible downstream costs raised by commenters, saying they gave insufficient data.
prefix: $
suffix: M
---
Payer | Reduction
Federal | 138
State | 97
```

The rule also cites an HHS review estimate of about $31 million a year in this kind of spending. It calls that "a very small fraction of total Medicaid and CHIP spending." CMS also reported that it received about 11,000 comments on the proposed rule, with more than 90% opposed and fewer than 10% supportive. Comment counts measure who chose to write in, not public opinion.

## What the families are arguing

The lawsuit was filed October 1 by GLAD Law, the National Center for LGBTQ Rights, the ACLU of New Hampshire and the law firm Robinson + Cole. It names HHS, Secretary [Robert F. Kennedy Jr.](/politicians/robert-f-kennedy-jr), CMS and Administrator Mehmet Oz.

The families' main argument rests on Medicaid's Early and Periodic Screening, Diagnostic and Treatment requirement, known as EPSDT. Under that 1967 mandate, Medicaid must cover medically necessary screening, diagnosis and treatment for children. GLAD attorney Chris Erchull argued that doctors and states, not the federal government, decide what is medically necessary for a child. "Congress cannot have intended EPSDT to apply except when the president disagrees," he told the court, according to the Bulletin.

The families also say the harm is immediate. Erchull said one plaintiff, identified by the pseudonym "Kylie Coe," lost access to puberty blockers she had received through Medicaid and is now going through physical changes her classmates notice. GLAD said in an [October 30 statement](https://www.gladlaw.org/families-ask-federal-court-to-block-trump-rule-restricting-care-for-transgender-youth-on-medicaid/) that the plaintiffs had "already encountered issues accessing the care they need" since the rule took effect. "Transgender youth and their families covered by Medicaid deserve to make medical care decisions in concert with their health care professionals – not politicians," said Henry Klementowicz, deputy legal director of the ACLU of New Hampshire.

The plaintiffs further argue that CMS skipped required procedural steps, such as meaningfully weighing alternatives and public comments. That dispute, the Bulletin reported, is likely to take months.

## What the government is arguing

Justice Department attorney Stephen Tagert told the court the case is about money, not access. "This is not about any sort of ban (on gender-affirming care)," he said, according to the Bulletin. "This is about whether the federal government pays for it." Tagert argued that the government's power to make sure medically necessary care is covered implies a matching power to make sure medically unnecessary care is not, calling them "two sides of the same coin."

HHS and CMS rest the rule on the evidence question. "These interventions carry serious risks and can cause irreversible harm," Kennedy said in the CMS announcement. Oz said the agency is "following the science, saving taxpayer dollars, and, most importantly, protecting children from potentially irreversible harm."

The rule points to the United Kingdom's Cass Review and to policy shifts by some medical groups, including the American Society of Plastic Surgeons. The rule's text also cites President Trump's January 2025 executive order on these treatments for minors.

Most major medical organizations still back this care for some adolescents, as the Bulletin noted. The rule itself says the American Academy of Pediatrics reaffirmed its supportive policy statement in 2023 while starting its own evidence review. The scientific dispute is real and ongoing; the rule and its critics read the same body of research differently.

## Why the judge challenged both sides

McAuliffe's questions suggested he was not fully persuaded by either side. He was skeptical that EPSDT leaves the medical-necessity decision entirely to providers. "The system isn't at the whim of any healthcare provider that says this is medically necessary. Someone has to make those decisions," he said. He also said he did not see anything in the EPSDT statute "about gender dysphoria," calling it "a sociopolitical issue."

But he also pressed the government. When Tagert said the rule was only about funding, McAuliffe answered: "It's an effective ban. Name me a state that has continued to fund the care. There's none." He asked why CMS was intervening now after it had approved New Hampshire's Medicaid plan before. "Coming in here, I generally agreed with you," he told Tagert, "until I came in here and heard it's the rule that's the problem."

Judges often question both sides sharply, as the Bulletin noted, so the exchanges do not reliably predict a ruling. An earlier [October 5 order](https://litigationtracker.law.georgetown.edu/wp-content/uploads/2026/10/Goe_2026.10.05_ORDER-ON-MOTION-FOR-PRELIMINARY-INJUNCTION.pdf) shows McAuliffe declined to issue an emergency temporary restraining order before the rule took effect, finding the plaintiffs had not shown the kind of immediate emergency that requires. The preliminary injunction request is a separate, still-pending motion.

## New Hampshire's own law complicates the case

New Hampshire banned these treatments for minors in 2025 under Gov. [Kelly Ayotte](/politicians/kelly-ayotte), but the law allowed young people already in treatment to continue. That carve-out cut both ways in court.

McAuliffe asked why the state's ban did not show that New Hampshire considers the care medically unnecessary. Erchull answered that because his four clients were grandfathered in, the state had effectively judged the care necessary for them. GLAD's statement made the same point. "New Hampshire's legislature has already decided that cutting off care for young people who are in the middle of treatment would be wrong." Tagert argued the opposite, that the state and federal governments "are aligned," citing the 2025 ban.

New Hampshire is not alone in that position. The rule's own survey of state laws found that 10 states have grandfather clauses that mainly let children already in treatment keep receiving it indefinitely. It also found that 14 states and the District of Columbia have shield laws covering some or all of these treatments, and three states have executive orders that do the same. Those are the places where the federal funding cutoff is most likely to change what Medicaid patients can actually get.

The result is that the plaintiffs are asking a federal court to protect care that their own state otherwise prohibits for new patients. A ruling for them would not reopen access for other New Hampshire minors.

## How this fits a wider federal push

The Medicaid rule is one of several federal actions in 2026 on transgender policy. HHS also issued a final rule on gender dysphoria under Section 504 of the Rehabilitation Act, which we covered in [our story on the Section 504 rule](/news/hhs-section-504-gender-dysphoria-final-rule-federal-register-november-2026). We have also reported on a [federal research grant on gender dysphoria and violent crime](/news/nij-gender-dysphoria-violent-crime-research-grant-1-million-november-2026) and on [Marine Corps transgender separations](/news/marine-corps-ends-service-extensions-transgender-separations-talbott-supreme-court-november-2026). Other Medicaid policies have also landed in court this year, as in our coverage of [a ruling on the "medically frail" standard](/news/medicaid-medically-frail-ruling-stearns-october-2026).

Supporters of the administration see these steps as a consistent effort to apply a stricter evidence standard and to keep federal programs from funding contested treatments for minors. Opponents see a pattern of federal action aimed at transgender people across health, disability and civil rights law. Both readings describe the same set of actions; they differ on the evidence and on the role of federal power.

## Methods and limits

This report draws on the final rule's full text in the Federal Register, CMS's announcement, GLAD's statement, the court's October 5 order and the New Hampshire Bulletin's account of the October 30 hearing. Quotations from the hearing come from the Bulletin's reporting; we did not review a transcript. We did not find a representative national poll asking specifically about Medicaid funding for these treatments for minors, so this story does not characterize public opinion on the rule. The officials named are executive-branch appointees, not candidates, so no campaign-finance records were relevant to this story. No ruling on the preliminary injunction had been reported as of November 9.