A federal rule barring Medicaid from covering gender-affirming care for minors took effect Tuesday, Oct. 13, hitting low-income families across Fairfax County.

The U.S. Department of Health and Human Services (HHS) rule prohibits federal Medicaid and Children's Health Insurance Program (CHIP) dollars from paying for puberty blockers, hormone therapy or surgery for young people. Minors under 18 on Medicaid and under 19 on CHIP lose that coverage, as the Virginia Mercury reported via WTOP. Patients with private insurance are not affected.

Virginia's Department of Medical Assistance Services (DMAS) confirmed the change in a late-September bulletin. The agency said it would stop covering gender dysphoria services once the federal rule kicked in. Youth already receiving medications as of Oct. 13 are eligible for a tapering-off period of up to six months.

More than 150,000 Fairfax County residents participate in Medicaid, according to the county's Department of Family Services. Nationally, about 133,000 transgender youth in states without bans use Medicaid or CHIP for their care, according to KFF Health News, as cited by the Virginia Mercury.

ACLU of Virginia attorney Wyatt Rolla said the state could step in with its own money. "It's important that every parent is able to get the healthcare that their child needs, no matter what kind of health insurance they have," Rolla told the Virginia Mercury on Oct. 14.

Rolla pointed to a precedent. Virginia's most recent state budget set aside $150 million to help households earning between 138% and 250% of the federal poverty level keep health coverage. That money came after Congress let Affordable Care Act subsidies expire. The ACLU argues lawmakers could take the same approach to replace the lost federal funding for transgender youth.

Del. Rodney Willett, D-Henrico, who chairs the House Health and Human Services Committee, told the Virginia Mercury he supports that idea. He said he hopes state lawmakers could allocate funding during the 2027 legislative session, which begins Jan. 13. Preliminary conversations have not yet started.

The question is whether the money will be there. Gov. Abigail Spanberger's administration estimates Virginia could face a $2 billion to $6 billion revenue loss starting in 2028 from broader federal changes to Medicaid and social services.

Spanberger told The Advocate, as reported by the Virginia Mercury, that the coverage loss was not her administration's choice. She blamed the Trump administration for changing access to health care. Her office said Oct. 14 that potential funding could come from the legislature.

The ACLU and Equality Virginia met with DMAS Director Steven Ford in August to raise concerns. In an Oct. 9 joint letter, the groups alleged Virginia violated its own procedural rules by complying with the HHS rule without proper process. No public response from DMAS to that allegation appears in available records. The groups emphasized that the federal rule does not prohibit states from using their own funds to continue coverage.

Virginia is part of a 22-state lawsuit challenging the rule, but no court injunction blocked it before the Oct. 13 effective date. Mental health services remain covered without changes, according to the DMAS bulletin.

The Virginia General Assembly's 2027 session runs through Feb. 27.