HHS Finalizes Section 504 Rule Excluding Gender Dysphoria From Disability Protections. It Takes Effect in January.
The rule, effective Jan. 2, writes the exclusion into disability rules for HHS-funded programs. A 2022 appeals ruling points the other way in five states.
The Department of Health and Human Services (HHS) has finalized a rule stating that gender dysphoria not resulting from a physical impairment is excluded from the definition of disability under Section 504 of the Rehabilitation Act. The rule applies to programs that receive HHS funding.
The HHS Office for Civil Rights placed the rule on public inspection Oct. 30. It is scheduled for Federal Register publication on Nov. 3 and takes effect 60 days later, Jan. 2, 2027, by our count. Section 504 bars disability discrimination by recipients of federal financial assistance, and HHS's regulation for its own recipients is at 45 CFR part 84.
What does the rule change?
It changes one definition. The statute already excludes "gender identity disorders not resulting from physical impairments" from the definitions of disability. The rule says HHS reads that exclusion to cover "gender dysphoria not resulting from a physical impairment." The final text is unchanged from the December 2025 proposal.
HHS says it is correcting a statement in the preamble to the May 2024 Section 504 rule, which concluded that gender dysphoria did not fall within the statutory exclusion. That preamble language was never part of the regulatory text, and HHS said in an April 2025 notice that it could not be enforced. The department argues the statute means what the term meant when Congress enacted the exclusion in 1990 and 1992, under the diagnostic manual then in use, and that later DSM revisions cannot change it.
Where do the courts stand?
The only federal appeals court to rule on the question reached the opposite conclusion. In Williams v. Kincaid (2022), the Fourth Circuit held that gender dysphoria is not excluded from the Americans with Disabilities Act as a gender identity disorder. It also held that the plaintiff's medically treated condition could fall within the exception for disorders resulting from physical impairments, according to a Hunton Andrews Kurth summary of the decision. The Supreme Court declined to review the case in 2023.
HHS acknowledges that Williams is binding in federal courts in Maryland, North Carolina, South Carolina, Virginia and West Virginia, but says the decision applies only in that circuit and diverges from rulings by numerous other courts. The Script Pad's reading: HHS-funded hospitals and practices in those five states now face a federal regulation and a binding appellate precedent that point in different directions, and the rule does not say how HHS will handle that in Fourth Circuit complaints.
The rule changes one definition. It does not settle the conflict with the only appeals court to decide the question.
What the rule says it does not do
HHS received more than 380 comments, which it describes as divided. In its responses, it says the rule does not address sex discrimination, which falls outside Section 504, and does not judge whether gender dysphoria is legitimate or how it should be treated. It says it will handle discrimination complaints case by case. Responding to commenters who raised clinicians' religious or moral objections to certain treatments, it notes that its Office for Civil Rights also enforces federal conscience laws such as the Church and Coats-Snowe Amendments.
Commenters also asked who decides whether a patient's gender dysphoria results from a physical impairment, since the exclusion turns on that. HHS said the distinction has been in the statute since 1990 and that it knows of no recent case in which a clinician could not make that determination. It offered no new guidance. Litigation over the 2024 rule, including Texas v. Kennedy in the Northern District of Texas, is still pending.
What practices should check
Compliance officers at HHS-funded practices and hospitals should review Section 504 grievance procedures and accommodation policies before Jan. 2 and note any language that relies on the 2024 preamble. Organizations in the Fourth Circuit states should get legal advice on how the rule and Williams interact. HHS says sex discrimination questions fall outside this rule. Separately, a federal court recently blocked a CMS definition in the Medicaid work rule, another case in which a federal definition ended up being decided in court. For another legal change physicians face this week, see our guide to what Idaho's Proposition 1 would change for physicians.
Reported, fact-checked and edited by The Script Pad's editorial staff. See How we use AI.
This article is for professional education and does not replace clinical judgment. Treatment decisions should be based on the individual patient and current guidelines.
