Vice President J.D. Vance is directing the Department of Justice to launch a federal criminal investigation into health care providers falsifying billing codes to get insurance to cover the cost of “transgender” medical interventions for children, saying those found guilty “should go to prison.”
Vance’s Justice Department referral came shortly after the Department of Health and Human Services (HHS) released a report detailing profit incentives for predator doctors to convince children they are a different sex, creating a lifelong paying “captive patient.” The document “may have been defrauding Medicaid and private insurers by using misleading or fraudulent billing codes to get insurance to cover the costs,” Vance said.
“Today I am referring the HHS report and the allegations it contains to the Department of Justice to determine whether the providers identified have violated federal law, regulations, or policies … and federal fraud and conspiracy laws,” Vance wrote in a letter to Attorney General Todd Blanche. “When providers miscode treatments in order to secure insurance coverage for gender-transitioning interventions that insurance would not otherwise cover, they should be held accountable. If they have done so intentionally, thereby perpetrating fraud on Medicaid or on private insurers, they should go to prison.”
According to the HHS report, doctors and hospitals have filed roughly $120 million in insurance claims related to child “transgender” medical procedures since 2019, noting that more than 225 hospitals and health systems set up pediatric transgender clinics from 2015 to 2025. The report alleges the revenue resulted from “over 5,500 surgical procedures and 8,500 courses” of opposite-sex hormones or puberty blockers.
The report says those clinics “used misleading or potentially fraudulent diagnostic and procedural codes” to obtain insurance payments for the interventions, which include mastectomies and vaginoplasties. For example, there was a 30 percent increase in billing for “endocrine disorder, unspecified” from 2020 to 2022, while fewer than 5 percent of patients with that code really had endocrine disorders.
Nonetheless, over the past 10 years, doctors used this generic code to give puberty blockers to hundreds of children ages 9-17 who should have been coded as having gender dysphoria, raking in $42.6 million, according to the report. The majority of the claims were paid by insurance companies, but about $7.8 million was paid by Medicaid.
Another code used, the report said, was “precocious puberty,” which is a rare condition where puberty begins too early — it is typically diagnosed before age 8 for girls and 9 for boys. In those instances, puberty blockers are administered to delay puberty temporarily so it can take its course at a normal age. They are usually stopped at age 10 or 11.
However, at Children’s Hospital of Philadelphia, for example, roughly 250 children were diagnosed with the condition at ages 10 and above, including “numerous teenagers 14 to 18. … well beyond the age” of typical diagnosis, the report said.
“This miscoding has allowed hospitals to bill insurance companies tens of millions of dollars for medication like puberty-blocking drugs,” Vance said.
As the report noted, pediatrics is the “lowest-paid medical specialty” and pediatric departments usually have lower profit margins “and thus presumably wield less influence” relative to other specialty areas. “Gender clinics changed that calculus by introducing a novel source of revenue: they promised a new stream of continuous revenue for pediatrics, endocrinology, and surgical specialties by taking physiologically healthy young people — who otherwise would not need to seek medical attention, and rendering them dependent for life on the medical system.”
For transgender-related interventions alone, lifetime health care cost totals for patients who start to “transition” as children can be up to $75,000 “even without surgeries.” With surgeries, it can skyrocket to $170,000 per patient. Even that is before separate therapies like “fertility preservation (egg or sperm banking), voice therapy, hair removal,” or even attempts at reversal through detransitioning.
The report included eight first-hand accounts from parents and children who reported weak or nonexistent clinical safeguards, rushed processes to get patients into medical interventions as quickly as possible, very little psychological examination, parents pressured into trans medicalization, and patients being left out to dry when attempting to detransition.
“When a child is in distress, many parents will go to any length to find help and to relieve the pain. These parents count on America’s pediatric hospitals, medical associations, and federal regulatory agencies to value science over ideology and people over profit when recommending medical procedures,” the report stated.
“Instead, parents encountered wolves in white lab coats who pushed vulnerable children down a path towards irreversible harm from sex-rejecting procedures. Financial incentives from the medical industry and lobby; political and ideological pressures; and failure of oversight at the local, state, and federal levels have all contributed to the rapid medicalization of these procedures and resulted in long-term physical and psychological consequences for many patients.”
