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The U.S. government’s health program for the elderly and disabled can no longer refuse to pay for the costly sex reassignment operations of transgender patients who claim to have gender identity disorder, according a recent federal board ruling.

First President Obama’s hostile—and disastrous—takeover of the nation’s healthcare system and now American taxpayers must finance sex reassignment operations for transsexuals. For decades Medicare has automatically denied requests for sex reassignments surgeries, but a U.S. Department of Health and Human Services (HHS) review board recently issued a shocking ruling that acknowledges the procedures as medically necessary and effective treatment for individuals who don’t identify with their biological sex.

Officially known as the HHS Departmental Appeals Board, the panel is an independent entity within the agency and is staffed with career civil servants that wield tremendous power. In fact, the board’s decisions constitute final HHS decisions that can’t be reversed and can only be challenged in federal court. The board’s mission is to provide impartial, independent review of disputed decisions. In this case, a 74-year-old transgender Army veteran, Denee Mallon, disputed Medicare’s refusal to pay for his genital reconstruction surgery.

Mallon, who lives in New Mexico, was born a man, joined the U.S. Army at 17 and worked as a forensics investigator a city police department after leaving the military. He “lived as a woman on and off” since his teen years and “full time since 2009,” according to a national news story. Mallon was later diagnosed with gender identity disorder and he’s been trying to get Medicare to pick up the tab for gender reassignment surgery, which can run anywhere from $10,000 to $50,000. Since 1981 Medicare recipients have been ineligible for transsexual surgery.

The HHS board ruling changes this by eliminating Medicare’s blanket exclusion on transsexual operations. Justifying the change, the panel said that studies and experts have shown the efficacy of surgical interventions as a treatment for gender dysphoria, a diagnosis issued to those who undergo extreme distress over a disconnect between their gender at birth and the one they identify with. “Transgender surgery is a treatment option for the medical condition of transsexualism,” the ruling says, further stating that the National Coverage Determination (NCD) “recognized that transsexualism is a diagnosed medical condition.”

Here is a description of the medical condition, as per the recent HHS ruling that forces the government to pay for sex-change operations: “The disorder is characterized by intense and persistent discomfort with one’s primary and secondary sex characteristics—one’s birth sex. The suffering that arises is often described as being trapped in the wrong body. The psychiatric term for this severe and unremitting emotional pain is gender dysphoria.”

This is hardly the first time that American taxpayers have been forced to fund transgender benefits. This occurs regularly in prisons across the country where convicted felons, who claim to be diagnosed with “gender identity disorder,” get hormone treatments, laser hair removal and makeup while serving their sentence. For instance Massachusetts pays for the hormone shots of at least four inmates diagnosed with gender identity disorder. Colorado pays for the female hormone treatment of a convicted child molester who is suing the stat to provide him with a gender specialist in hopes that the specialist determines he needs a sex-change operation.

Last year a federal appellate court ruled that denying a transgender bank robber’s sex-reassignment surgery violates the Constitution’s Eighth Amendment protections against cruel and unusual punishment. That case involves a felon (Michael Stokes) serving a 73-year sentence in Virginia. A federal judge in Roanoke denied the surgery, finding that hormone therapy and psychological counseling provided by the prison are sufficient accommodations for a transgender prisoner. Officials also allow the convict to dress and live as a woman. Determined to get his sex-change operation, the convict took his case to the United States Court of Appeals for the Fourth Circuit, which ruled that Virginia prisons can’t justify providing partial treatment for other medical needs, so why this one?

“By analogy, imagine that prison officials prescribe a painkiller to an inmate who has suffered a serious injury from a fall, but that the inmate’s symptoms, despite the medication, persist to the point that he now, by all objective measure, requires evaluation for surgery,” the appellate court opinion says.  “Would prison officials then be free to deny him consideration for surgery, immunized from constitutional suit by the fact they were giving him a painkiller?”





Records uncovered from the U.S. Department of Health & Human Services (HHS) show that the division blaming cancer treatment curtailment on sequester paid more than $100,000 in bonuses to four of its top earners during the last two fiscal years.  Pursuant to the Freedom of Information Act (FOIA), Judicial Watch, Inc., filed on April 27, 2012 a request for the top earners’ pay records.  Thirteen months later, the Centers for Medicare and Medicaid Services (CMS) released eleven pages which showed the following.

1) The Deputy Chief Operating Officer, whose base pay is $179,700, was awarded:

  •  a 25% bonus on October 1, 2011 worth $44,925;
  • another $10,333 bonus on Dec. 31, 2011; and,
  • an additional $8,985 on Dec. 12, 2012

bringing her total compensation to $423,643 for the two fiscal years.

2) Meanwhile, the Director of the Office of Financial Management, whose base pay was also $179,700, was awarded:

  •  a 15% bonus on October 1, 2011 worth $26,955;

bringing her total compensation for the year to $206,655.

Total bonuses reflected in the documents amounted to $101,531.  Total pay reflected in the documents for the four employees was $820,331.

CMS under fire for blaming cut of cancer treatments on sequester:


Lack of timely communication between federal agencies has cost the U.S. government as much as $125 million for medical care that isn’t even supposed to be provided to illegal immigrants and incarcerated criminals.

It’s yet another case of government incompetency that’s like a swift kick in the stomach during a $16 trillion (growing by more than $3 billion daily) national debt crisis. Because the Social Security Administration can’t seem to provide accurate information on time, Medicare, the government insurance for the elderly, makes improper payments for services it shouldn’t even be financing.

During a recent two-year period U.S. taxpayers spent $92 million for the medical care of 2,600 illegal aliens and $34 million to treat 12,000 prisoners, who already get their healthcare needs met by states, according to separate federal audits. The fleecing was first reported a few days ago by a weekly publication that covers the healthcare industry.

The story cites two reports issued this month by the Department of Health and Human Services Office of Inspector General. The first reveals how Medicare, the government program that provides health insurance for people aged 65 and over and those with disabilities who have worked in the U.S., regularly pays for the healthcare costs of ineligible foreigners living in the country illegally.

During a sample probe that spanned from 2009 to 2011, investigators reviewed 133,541 claims on behalf of 2,575 unlawfully present beneficiaries with $91,620,548 in associated Medicare payments. The Centers for Medicare & Medicaid Services (CMS), the agency that runs the program, approved payments because the Social Security Administration didn’t give it verification data relating to unlawful presence in a timely manner, the probe found. When CMS got the information on time, it was able to flag illegal aliens who are not eligible for services.

Each year a chunk of the money paid for the inpatient and outpatient hospital care of illegal aliens. In 2009 the tab for those services was around $31 million, with $25 million in 2010 and nearly $10 million in 2011. The other high expenses were for physician services and skilled nursing facilities. This is only a small sampling so the cost could very well be much higher. The inspector general recommends implementing policies and procedures to recoup the “improper payments” rendered to unlawfully present beneficiaries. Since it’s not their money, the feds currently have no such process.

The second report identifies 135,805 Medicare beneficiaries who had been incarcerated at some point during calendar years 2009 through 2011 and were therefore not eligible for the program. This is because state’s pick up the healthcare costs of jailed populations. Auditors limited the review to 75,639 claims on behalf of 11,619 incarcerated beneficiaries with $33,587,634 in associated Medicare payments, so again, there are probably a lot more. Like in the case of illegal aliens, the feds have no process to recoup the money. That’s because it’s not coming out of their pocket.


Judicial Watch, the public interest group that investigates and prosecutes government corruption, announced today that it has obtained documents from the Department of Health and Human Services regarding the controversial review of the prostate cancer treatment Provenge by the Centers for Medicare and Medicaid Services (CMS). Judicial Watch obtained the documents pursuant to a Freedom of Information Act (FOIA) lawsuit filed on January 3, 2011 (Judicial Watch v. Department of Health and Human Services (No. 11-0002)).

According to the documents, the purpose of this review, deemed a National Coverage Determination (NCD), is to determine if the FDA-approved Provenge treatment is “reasonable and necessary” and should therefore be reimbursed on a uniform and national level. The review was triggered by the fact that local Medicare contractors were not uniformly providing coverage for Provenge leading to multiple complaints by patients. Some contractors withdrew coverage in the middle of treatment. CMS is expected to post a “proposed decision” on its website March 30, 2011, with a final decision published 60 days after the public comment period for the proposed decision has ended.

Among the highlights from the documents uncovered by Judicial Watch:

  • The documents include a CMS Q&A sheet that denies cost was a factor in the decision to review Provenge. However, a June 8, 2010, internal email uncovered by Judicial Watch from William D. Rogers, Director of the CMS Physicians Regulatory Issues Team, to Louis B. Jacques, CMS Director, Coverage Analysis Group, states: “We discussed this on the last CMD [Contract Medical Director] call. $93,000 per treatment adds four months to life, 27,000 patients a year $2.6 billion dollars a year.” Medicare and the FDA are legally prohibited from denying approval of a medical treatment based solely on cost. Obama administration officials have denied that the review of Provenge had anything to do with the treatment’s costs.
  • A July 28, 2010, letter to Louis Jacques from Hans Bishop, Chief Operating Officer of Dendreon, the company that manufactures Provenge, and Mark Frohlich, Dendreon’s Chief Medical Officer, objecting to the “highly unusual” review of Provenge.

    While noting the “overwhelming clinical evidence” of Provenge’s effectiveness, and the FDA’s rigorous approval process, Dendreon asked the CMS to shut down the NDA: “We remind you that the patients we serve have late-stage cancer and few, if any, appealing treatment options available to them, with only chemotherapy as an FDA-approved alternative. Not only is Provenge clearly reasonable and necessary…but it provides an unambiguous survival benefit and real hope for patients battling their disease.” Dendreon argued to keep the system’s status quo, with local contractors making coverage decisions as coverage variations have “subsided.” The letter also suggests that coverage is required by law as a result of the FDA’s prior approval of the Provenge treatment for prostate cancer.

  • An internal CMS email indicating that the government hired health insurance giant Blue Cross Blue Shield, identified in public documents as an “external entity,” to conduct a technological assessment of Provenge’s clinical effectiveness. The involvement of Blue Cross Blue Shield raises concerns about a potential conflict of interest as private insurers use Medicare’s coverage determinations in setting their own coverage limits.

  • The documents include back-and-forth discussions between CMS and Dendreon about “comparative effectiveness.” In response to Dendreon’s request for clarification regarding the term “comparative effectiveness,” Jacque’s writes in a July 22, 2010, email to a CMS colleague: “Why do they need clarification?…We need to maintain an arms [sic] length relationship with them. We do no[t] owe them any questions.” Many have criticized comparative effectiveness research as a method to limit needed health care in order to reduce costs (i.e., death panels).

A number of the documents were distributed to CMS Administrator Donald Berwick, dubbed “Death Panel Donald” for his public comments endorsing health care rationing.

“Clearly, there is enormous public interest in the CMS decision to review Provenge given all of the talk of health care rationing and death panels associated with Obamacare. The American people get very nervous when the government decides to meddle in their health care and they have every right to be nervous given that we have unaccountable czars like Donald Berwick running Medicare and Medicaid. One can’t help but conclude from a review of these documents that there is a strong bias against Provenge in the Obamacare bureaucracy,” stated Judicial Watch President Tom Fitton.

A recent study shows that in 2010, only two of the 11 National Coverage Determinations led to “unrestricted positive coverage decisions.” The remaining decisions mandated restrictions of coverage of one type or another.

Documents Uncovered

Judicial Watch Investigates Charge HHS is Unlawfully Rationing Healthcare by Targeting FDA-approved Medical Treatment Based on Cost

Contact Information:

Press Office 202-646-5172, ext 305

Washington, DC — January 5, 2011
Judicial Watch, the public interest group that investigates and prosecutes government corruption, announced today that it filed a lawsuit on January 3, 2011, against the Obama Department of Health and Human Services (HHS) regarding a controversial decision by the Centers for Medicare and Medicaid Services (CMS) to undertake a one-year review of the prostate cancer treatment Provenge to determine if the treatment is “reasonable and necessary” and should therefore be reimbursed (Judicial Watch v. U.S. Department of Health and Human Services (Case No. 11-002)).
Provenge, the first ever therapeutic vaccine cancer treatment approved by the Food and Drug Administration (FDA), was shown to have extended life spans by an average of four months in clinical trials with few side effects. It costs $93,000 to administer the three necessary treatments. Medicare and the FDA are legally prohibited from denying approval of a medical treatment based solely on cost.
Yet multiple press reports suggest that cost is the major factor in the unusual decision by CMS to undertake a review of the treatment which could signal a move by the Obama administration to begin implementing healthcare rationing based on the cost of treatments.
Judicial Watch’s original FOIA request, filed on November 9, 2010, seeks the following information: “All records concerning CMS’s national coverage analysis of the vaccine Provenge, including but not limited to the criteria being used to analyze Provenge.”Health and Human Services was required by law to respond to Judicial Watch’s request by December 15, 2010. However, to date, the agency has failed to provide any documents or indicate why documents should be withheld. Nor has it indicated when a response is forthcoming.CMS Administrator Donald Berwick is on record supporting the idea of rationing healthcare based on cost. Berwick said the following in a June 2009 interview with Biotechnology Healthcare: “The social budget is limited — we have a limited resource pool. It makes terribly good sense to at least know the price of an added benefit, and at some point we might say nationally, regionally, or locally that we wish we could afford it, but we can’t…
The decision is not whether or not we will ration care, the decision is whether we will ration with our eyes open.”Owing to the controversy surrounding Berwick’s statements, President Obama bypassed Senate confirmation and made Berwick a “recess appointment,” a decision criticized by both Democrats and Republicans in Congress.“The Obama administration claims there is no merit to the charge that the Provenge decision is the first step in implementing healthcare rationing so why not release these records? What does the Obama administration have to hide? Provenge is an FDA approved drug that has a proven track record and the Obama administration has no legal right to deny this treatment based on its cost. But the American people are right to be concerned about this Provenge review, given the fact that a man dubbed ‘Death Panel Donald’ Berwick is in charge of Medicare and Medicaid,” stated Judicial Watch President Tom Fitton.

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