Eighth Circuit: Denial of Insurance Coverage for Employee’s Transgender Son Is Not Sex Discrimination

By Edgar M. Rivera

On May 24, 2017, the Eighth Circuit Court of Appeals affirmed the district court’s dismissal of plaintiff Brittany Tovar’s sex discrimination claim under Title VII of the Civil Rights Act of 1964 (Title VII). The court held that Defendant Essentia Health’s denial of insurance coverage for Ms. Tovar’s son’s transition-related medical procedures did not state a claim for sex discrimination under Title VII, since Ms. Tovar did not suffer discrimination based on her own sex and therefore lacked statutory standing.

Ms. Tovar, a nurse practitioner, worked for Essentia Health from 2010 to 2016. During her employment at Essentia Health, she was enrolled in an employer-provided health insurance plan that also covered her teenage child, who is a transgender boy, meaning that he was designated female at birth but identifies as male. In 2014, doctors diagnosed Ms. Tovar’s son with gender dysphoria and recommended various treatments, including medications and gender reassignment surgery, for which Ms. Tovar sought coverage under her employer’s insurance plan.

However, Ms. Tovar’s requests for coverage were denied on the basis of a categorical exclusion in the insurance plan for “[s]ervices and/or surgery for gender reassignment.”  The coverage dispute caused Ms. Tovar “worry, anger, disappointment, and sleepless nights,” made it “more difficult for her to focus on her work,” and led her to suffer “a sharp increase in migraines.” Ms. Tovar also paid out-of-pocket for at least one of her son’s prescribed medications and could not afford to pay for another prescribed medication or gender reassignment surgery. Ms. Tovar filed suit against Essentia Health alleging claims of sex discrimination under Title VII, among other things.

Essentia Health moved to dismiss the Title VII sex discrimination claim, arguing that Ms. Tovar lacked “statutory standing.” A plaintiff has “statutory standing” where she seeks relief for a violation of a statute and “falls within the class of plaintiffs whom Congress has authorized to sue” under that statute. If a court determines that Congress has not provided a statutory cause of action in a particular case, the claim may be subject to dismissal under Federal Rule of Civil Procedure 12(b)(6). The district court dismissed the Title VII sex discrimination claim, and plaintiff appealed to the Eighth Circuit.

The Eighth Circuit agreed with the lower court’s conclusion that Ms. Tovar had no statutory standing to bring her Title VII sex discrimination claims against her employer because she did not fall within the class of plaintiffs Title VII’s sex discrimination provision protects. Specifically, Title VII prohibits an employer from discriminating “against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s […] sex.” Ms. Tovar brought her Title VII claim under the theory that Essentia Health discriminated against her with respect to her compensation by denying her son insurance coverage based on his sex.  The district court concluded that, because Ms. Tovar had not alleged that her employer discriminated against her on the basis of her own sex but rather on the basis of her son’s sex, her complaint failed to state a claim for relief under Title VII.  In other words, Title VII prohibits employers from discriminating against employees on the basis of their own protected characteristics, but Ms. Tovar did not allege that she was discriminated against on the basis of her own sex; by its terms, the protections of Title VII do not extend to such discrimination.

The court distinguished this action from association discrimination claims based on race—claims where a plaintiff alleges that they were discriminated against because of their relationship with an individual of a different race—on the basis that the discrimination challenged in those cases was still based on an employee’s own protected characteristic (their race), even if the significance of that characteristic was defined in relation to the characteristics of a third party. The court concluded that there was “no plausible argument that Essentia’s failure to cover gender reassignment treatment for Tovar’s son amounted to discrimination against Tovar on the basis of her own sex.”

If your employer has discriminated against you based on your gender identity, contact The Harman Firm, LLP, for a free assessment of your claims.