The Colorado Supreme Court issued a preliminary injunction directing Aurora-based Children’s Hospital Colorado to restore gender-affirming care services as the hospital undergoes a Justice Department probe with patient revenue on the line.
In a 5-2 decision issued May 18, the Colorado Supreme Court ordered Children’s Hospital Colorado to restore gender-affirming care services — particularly hormone therapy and puberty blockers — to transgender youths.
In 2024, the hospital received $182.6 million in funding — the majority from the federal government — according to court documents. Almost half of its patients are Medicaid enrollees, and because commercial payers require hospitals to participate in federal healthcare programs, the hospital would not be able to treat patients with Medicaid or commercial insurance plans if it were excluded from federal healthcare payment programs.
The Colorado Supreme Court returned the gender-affirming care lawsuit to a lower court. A Children’s Hospital Colorado spokesperson told Becker’s the system is reviewing the ruling and assessing next steps.
In a separate effort, the hospital is attempting to quash a subpoena from the Justice Department, which is seeking medical records of patients who received gender-affirming care and personnel records of medical professionals who provided the care.
“Given all of the contingencies in play and the various opportunities CHC has to avoid exclusion, we conclude that the actual immediate and irreparable harm to petitioners outweighs the speculative harm CHC may face if the federal government further acts against it,” the court said.
Over the past year, the federal government has moved to restrict gender-affirming care for minors, notably through efforts to limit or altogether remove federal funding from healthcare facilities that provide this care.
A few days before the Colorado Supreme Court’s ruling, Texas Children’s Hospital in Houston agreed to open the nation’s first “detransition” clinic, showing an increasingly splintered landscape for pediatric gender care in the U.S.
Amid legal and regulatory uncertainty, more than 20 hospitals and systems across the U.S. have reduced scope or shuttered gender care services over the past few months.
In December, HHS proposed ending CMS payments to hospitals that provide gender-affirming care to minors, including puberty blockers, hormone therapy and gender-related surgeries. The public comment period for feedback ended in February, but HHS has not issued a final decision on the proposal.
The latest developments at children’s hospitals in Texas and Colorado offer a glimpse of the widening divide in gender care across states and health systems. Both represent pressure points on health systems forced to choose between federal compliance and state law or court orders.
At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.
