## Facts

- In 1974, Carolyn Rush, a Medicaid-eligible applicant, requested that the Georgia Department of Medical Assistance pay for sex-reassignment surgery and related inpatient hospital and physician services under Georgia’s Medicaid program (Title XIX).
- Georgia denied the request, stating that Rush did not suffer from a pathological condition within program coverage and that sex-reassignment surgery was considered experimental and therefore not covered.
- At the time, Georgia Medicaid had written coverage limits excluding services that were not “reasonable and necessary” for diagnosis or treatment and excluding cosmetic surgery except in specified circumstances.
- Rush filed suit seeking declaratory, injunctive, and mandamus relief and damages to challenge the denial.
- The district court initially granted Rush summary judgment and ordered payment, but the former Fifth Circuit reversed and remanded in *Rush v. Parham*, directing fact-finding on (1) whether Georgia had a policy barring payment for experimental services when it denied the request and (2) whether classifying the surgery as experimental was reasonable; if not, the court was to consider whether Georgia properly determined the surgery was inappropriate treatment for Rush.
- On remand, the district court held a trial and received competing medical testimony and literature on transsexualism and sex-reassignment surgery, including disagreement over safety, efficacy, acceptance in the medical community, and concern about long-term effectiveness.

## Issues

1. Did Georgia have a Medicaid policy (written or applied in practice) that permitted denial of payment for “experimental” procedures at the time it denied Rush’s request?
2. If such a policy existed, was Georgia’s determination that sex-reassignment surgery was experimental (or not sufficiently established) reasonable under Medicaid standards?
3. If the denial could not properly rest on an experimental-procedure ground, did Georgia nonetheless make a valid administrative determination that the surgery was not medically necessary or appropriate treatment for Rush?
4. Did the denial violate the Equal Protection Clause, including whether transsexuals constitute a suspect or quasi-suspect class and whether the State’s action satisfied rational-basis review?

## Decision

- The court entered judgment for Aaron Johnson, Director of the Georgia Department of Medical Assistance, and upheld Georgia’s denial of Medicaid reimbursement.
- The court found that Georgia’s Medicaid rules and practice allowed the State to refuse payment for procedures it reasonably regarded as experimental or not “reasonable and necessary.”
- Based on the conflicting medical evidence and lack of clear, settled proof of long-term effectiveness, the court held Georgia had a rational basis for treating sex-reassignment surgery as experimental (or not established as necessary treatment) and therefore could exclude it from coverage.
- The court concluded that Title XIX did not require Georgia to fund the requested surgery where the State applied reasonable coverage standards and made a medically based determination supported by the record.
- The court rejected the equal-protection challenge, holding that transsexuals were not a suspect or quasi-suspect class and that the denial satisfied rational-basis review.

## Legal Principles

- A state Medicaid program may set reasonable standards for coverage, including medical-necessity limits, so long as the standards are consistent with federal Medicaid requirements.
- A state may deny Medicaid payment for treatments it reasonably determines are experimental, insufficiently proven, or not medically necessary, particularly where medical authorities materially disagree.
- Federal courts generally defer to state agencies’ medical and technical judgments in Medicaid administration when the decision has a rational basis and is not arbitrary.
- For equal-protection review of Medicaid coverage classifications affecting transsexual persons (as treated in this case), rational-basis review applies when the group is not deemed a suspect or quasi-suspect class, and the state action is upheld if rationally related to a legitimate governmental interest.

## Conclusion

After a post-remand trial, the district court upheld Georgia’s refusal to fund sex-reassignment surgery for Carolyn Rush, finding that Georgia could apply an experimental-treatment and medical-necessity limitation, that the classification of the procedure as experimental or not sufficiently established was reasonable given conflicting medical evidence, and that the denial did not violate Title XIX or equal protection under rational-basis review.


Rush v. Johnson, 565 F. Supp. 856 (1983)