Navigating Gender-Affirming Care in a Shifting Legal Landscape: Documentation, Coding, and Compliance Strategies

As state laws, federal regulations, and insurance policies continue to evolve, healthcare organizations face growing demands to ensure that gender-affirming care is appropriately documented and reported.

While providers are responsible for clinical decision-making and hospital coding, clinical documentation integrity (CDI) teams play a pivotal role in representing those services accurately through compliant code assignments and defensible documentation.

Recent policy shifts, including Executive Orders (EOs) 14168 and 14187 and the June 2025 U.S. Supreme Court ruling in United States v. Skrmetti, have placed additional scrutiny on services offered to transgender and nonbinary individuals, particularly minors. These developments have led to new challenges in medical necessity documentation, payer requirements, and mitigating the risk of denial.

This article examines practical strategies that hospitals and health information management (HIM) professionals can employ to navigate this complex landscape, with a focus on accuracy, audit readiness, and continuity of care.

Adapting to New Federal and State Constraints

The Supreme Court’s ruling in United States v. Skrmetti upheld Tennessee’s Senate Bill 1 (SB1), which prohibits gender-affirming medical treatments for individuals under 18. Although similar interventions, like hormone suppression for precocious puberty, remain permissible, the law singles out gender-related care for restrictions. Concurrently, Executive Orders 14168 and 14187 have redefined federal sex classification based on assigned sex at birth, limiting the use of federal funds for specific gender-affirming interventions, especially under Medicaid, TRICARE (the primary Military Health Insurance Program administered by the U.S. Department of Defense), and Federal Employees Health Benefits (FEHB) plans.

Though some courts have issued partial injunctions against enforcement, the resulting patchwork of legal interpretations has left healthcare institutions and coders navigating uncertain terrain. Clear, defensible documentation is now more critical than ever, not just for accurate coding, but also for protecting access to covered services.

Addressing PrEP Access and Documentation Amid Federal Shifts

As federal funding priorities shift under Executive Orders 14168 and 14187, access to Pre-Exposure Prophylaxis (PrEP) for HIV prevention has been impacted as well, both domestically and globally. While these executive orders primarily target gender-affirming care, they also affect broader LGBTQ+ health infrastructure, including data collection and prevention funding. The proposed elimination of the Centers for Disease Control and Prevention (CDC) Division of HIV Prevention and the temporary freeze on the President’s Emergency Plan for AIDS Relief (PEPFAR) have disrupted both international supply chains and domestic program funding, disproportionately affecting vulnerable groups such as transgender individuals, men who have sex with men, and sex workers.

From a documentation and coding standpoint, healthcare organizations must ensure that clinical and behavioral risk factors justifying PrEP use are clearly reflected in the medical record. Common ICD-10-CM codes that may support PrEP-related services include:

• Z20.6 – Contact with and (suspected) exposure to HIV;
• Z72.5 – High-risk sexual behavior;
• Z71.7 – HIV counseling; and
• Z79.899 – Long-term (current) use of other medications (e.g., chronic PrEP use).

For PrEP-related medication orders – such as Truvada, Descovy, or injectable cabotegravir – documentation should also include negative HIV test results, kidney function screening, and evidence of adherence counseling, per payer policy. Some insurers now require step therapy or prior authorization for newer formulations, especially under Medicaid or Patient Protection and Affordable Care Act (PPACA) marketplace plans in restrictive states.

Modifier usage may also play a role. For example, modifier 25 may be necessary when PrEP initiation occurs concurrently with other evaluation and management (E&M) services during the same visit. Coders and CDI professionals should work collaboratively to ensure that modifier placement aligns with payer logic, and that progress notes support its application.

Ultimately, failing to align documentation and coding with payer expectations for PrEP services can delay access to lifesaving prevention. In a climate where LGBTQ+ health equity is increasingly vulnerable to political decisions, PrEP documentation must be treated with the same level of rigor as gender-affirming care.

Coding with Precision: ICD-10 and Procedure Code Accuracy

Appropriate diagnostic coding is essential in this context. For instance, using F64.0 (transsexualism) or F64.1 (dual-role transvestism) with specificity is preferable over vague designations like F64.9 (gender identity disorder, unspecified). Coding errors, such as selecting generalized endocrine disorder codes like E34.9 in place of gender dysphoria, may trigger audits or denials.

On the procedural side, correct ICD-10-PCS assignment is critical. Gender-affirming surgeries may include multiple distinct procedures – removal of tissue, reconstruction, and closure – which should be captured using the proper root operations. Documentation should consist of clinical rationale, assessments of behavioral health professionals, lab results, and reference to accepted care standards, such as those from the World Professional Association for Transgender Health (WPATH) or the Endocrine Society.

Bridging Documentation Across Coverage Limits

The use of Modifier KX is especially relevant in this context, as it flags services as medically necessary even under restrictive policies. Coders should ensure that the modifier is supported by clear documentation that justifies treatment. For adolescent patients who begin therapy before age cutoffs and continue into adulthood, continuity notes explaining the medical need for ongoing care are essential.

Compliance Infrastructure: A Multidisciplinary Approach

Some health systems have taken proactive steps by establishing compliance task forces focused on providing care for LGBTQ+ individuals. These teams often include legal counsel, physician advisors, HIM professionals, and clinical leaders. Their goals include monitoring policy developments, updating templates and phrases, and building appeal strategies that cite Section 1557 of the PPACA and Employee Retirement Income Security Act (ERISA) protections when appropriate.

Audit Preparedness and Preventing Denials

Hospitals are increasingly adopting pre-claim strategies to reduce payer friction. Documentation packets containing provider statements, clinical assessments, and evidence-based guidelines can be prepared in advance and submitted with claims. Trends in payer edits and denials should be monitored using data dashboards and analytics, allowing HIM and CDI teams to spot vulnerabilities early.

Pre-bill reviews, whether conducted internally or through external consultants, help identify cases at high risk of denial – especially important for institutions receiving federal reimbursement.

Appeals, Escalation, and Strategic Follow-Up

When denials do occur, a structured response protocol is essential. High-priority cases, particularly those involving minors or HIV prevention, should receive expedited review. Appeal letters should reference not only clinical evidence, but also applicable protections under nondiscrimination laws. If internal appeals are exhausted, escalation to a Utilization Review Accreditation Commission (URAC)-accredited review body may be appropriate.

Hospitals should also track appeal outcomes and use that data to improve documentation, training, and response templates.

Education and Workflow Optimization

Sustained education is key. All team members, from scheduling to coding, should receive training on documentation standards for gender-affirming care, with a focus on accurate ICD-10 and CPT usage, modifier application, and awareness of legal constraints.

Workflow tools, such as checklists and phrases, should be updated regularly to reflect new coverage requirements and evolving clinical scenarios. Dashboards can help track denials, appeals, and coding trends to ensure that organizations remain audit-ready.

Mental Health and Continuity Considerations

Numerous studies have linked disruptions in gender-affirming care to worsened mental health outcomes, including increased depression, anxiety, and suicidality among transgender youth. CDI staff can play a meaningful role by ensuring that this context is reflected in documentation. For example, a note might read:

“Patient reports increased anxiety and passive suicidal ideation following forced discontinuation of hormone therapy due to loss of insurance coverage.”

Such entries can strengthen medical necessity justifications and support both appeal efforts and broader policy advocacy.

Legal Partnerships and Advocacy

Hospitals are also encouraged to form relationships with legal organizations experienced in LGBTQ+ health rights, such as Lambda Legal or the Transgender Law Center. These partnerships can assist with appeals, ensure policy alignment, and contribute to amicus briefs in ongoing litigation. Sharing de-identified denial data can also support collective legal challenges and help influence future federal rules.

Conclusion

As the policy environment surrounding gender-affirming care continues to shift, hospitals and health information professionals must adopt a rigorous, coordinated approach to documentation and coding. Specific diagnosis and procedure coding, strategic use of modifiers, and robust appeal frameworks all play a role in preserving access to medically necessary care.

These actions extend beyond regulatory compliance; they demonstrate a health system’s ability to uphold clinical integrity and serve vulnerable populations with clarity and compassion, even in the face of political and legal uncertainty.

Gender-Affirming Care Coding & CDI Compliance Checklist

☐ Confirm that provider documentation includes clear clinical rationale for gender-affirming interventions (e.g., diagnosis of gender dysphoria, mental health evaluation).

☐ Ensure that all documentation includes supporting behavioral health assessments when required by payer policy.

☐ Avoid ambiguous terminology – use specific clinical language (e.g., “feminizing hormone therapy” instead of “hormones”).

☐ Identify the age of the patient at the time of service to determine if federal restrictions apply (under age 19 = heightened risk).

Code Selection & Validation

☐ Validate that diagnosis codes (e.g., F64.0–F64.9 for gender identity disorders) are supported by provider documentation.

☐ Verify that procedure codes (ICD-10-PCS or CPT) align with the gender marker and are not restricted by policy edits (e.g., hysterectomy for male gender marker).

☐ Review Z-codes for social determinants of health (Z87.890 for personal history of sex reassignment) and ensure their appropriateness.

☐ Confirm any modifiers (e.g., -KX, -GY) are used according to payer requirements.

Payer Policy & Legal Review

☐ Check payer policy bulletins for coverage determinations, exclusions, and documentation requirements for gender-affirming care.

☐ Confirm whether the patient’s insurance plan is state-regulated or federally funded (PPACA, Medicaid, Medicare).

☐ Document any state-specific protections or court rulings that may override federal prohibitions.

☐ Flag cases involving youth for compliance/legal escalation before billing.

CDI Workflow Integration

☐ Train CDI staff on gender-affirming terminology and diagnosis specificity.

☐ Integrate gender-affirming care flags into CDI software or query templates for automated review.

☐ Create compliant, neutral CDI queries that do not imply bias or suggest unsupported diagnoses.

☐ Track denials and appeals related to gender-affirming care to identify trends and educate providers.

Audit Preparedness

☐ Maintain documentation of medical necessity, provider qualifications, and multidisciplinary evaluations.

☐ Keep copies of payer communications or authorizations on file.

☐ Establish a protocol for legal review if payers or governmental denials cite EO 14187 or similar policies.

☐ Conduct periodic internal audits of gender-affirming care encounters for coding integrity and policy alignment.

References

American Civil Liberties Union. (2025). L.W. v. Skrmetti case briefing. https://www.aclu.org/cases/lw-v-skrmetti

Centers for Medicare & Medicaid Services. (2025). Proposed rule for 2026 essential health benefits (EHB). https://www.cms.gov

Crowell & Moring LLP. (2025). Executive Orders 14168 and 14187: Summary and legal implications. https://www.crowell.com

Tordoff DM, Wanta JW, Collin A, Stepney C, Inwards-Breland DJ, Ahrens K. Mental Health Outcomes in Transgender and Nonbinary Youths Receiving Gender-Affirming Care. JAMA Netw Open. 2022;5(2):e220978. doi:10.1001/jamanetworkopen.2022.0978 https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2789423 

Executive Office of the President. (2025a). Executive Order 14168: Defending women’s rights and redefining federal sex classifications. Federal Register. https://www.federalregister.gov

Executive Office of the President. (2025b). Executive Order 14187: Protecting children and restricting gender-related procedures. Federal Register. https://www.federalregister.gov/d/2025-02194

HealthLaw.org. (2025). Gender identity and federal data system requirements under new mandates. https://www.healthlaw.org

Kaiser Family Foundation. (2025). Status of gender-affirming care laws by state. https://www.kff.org/other/dashboard/gender-affirming-care-policy-tracker/

MedMutual. (2025). Section 1557 and transgender health coverage updates. https://www.medmutual.com

National LGBTQ+ Bar Association. (2025). Analysis of federal executive orders and legal risks to LGBTQ+ access. https://lgbtqbar.org

Reuters. (2025, March 12). Insurers agree to reduce prior authorization burden for HIV prevention and gender-affirming care. https://www.reuters.com

Supreme Court of the United States. (2025). United States v. Skrmetti, 603 U.S. ___ (2025). https://www.supremecourt.gov/opinions

Transgender Law Center. (2025). State and federal litigation tracker. https://transgenderlawcenter.org

U.S. Department of Health and Human Services. (2025). Section 1557 nondiscrimination guidance. https://www.hhs.gov

Winston & Strawn LLP. (2025). Legal commentary on EO 14168 and 14187 litigation and injunctions. https://www.winston.com Kremen, J., Quint, M., Tham, R., Kane, K., Boskey, E., Morrow, C., Reisner, S., & Xu, R. (2025). Barriers experienced by and educational needs of clinicians who provide care for transgender, nonbinary, and gender-diverse young adults in the Mid-Atlantic and Southern United States. PLoS One, 20(6), e0326420.