By Rose Hoban

Updated with a comment from State Treasurer Dale Folwell

Most teens get summer jobs in order to buy a car, or clothes or save for college. Last summer, Connor Thonen-Fleck got a job at a veterinary practice to help pay for surgery to reduce the size of his breasts.

Connor Thonen-Fleck, 16, who attends the Early College at Guilford, gave public comment Monday morning to the trustees of the North Carolina State Health Plan for Teachers and State Employees, pleading with them to restore coverage for transgender transition therapies for SHP beneficiaries.

a white woman sits at a table with a younger man who stares straight ahead. The woman is speaking to someone who is off-camera.
State employee Alexis Thonen speaks to the trustees of the N.C. State Health Plan on Monday about the struggles her son Connor Thonen-Fleck went through before he, his parents and his doctors decided Connor should start testosterone therapy. Photo credit: Rose Hoban

“This has been a big part of my life. I’ve struggled a lot these past few years,” said Thonen-Fleck, the child of two state employees. “It is incredibly important to me that those struggles are addressed, that I get the medical care that I need.”

After struggling for years with depression, in 2017 Thonen-Fleck, his parents and his doctors started talking about beginning testosterone therapy to make the transition to male. During that year, the SHP was covering the costs of helping transgender people make their transitions using hormones and surgery.

But that policy was short-lived.

When Thonen-Fleck started testosterone therapy in January, he and his parents learned the window had closed on receiving reimbursement.

Thonen-Fleck and his mom Alexis Thonen were part of a group of transgender SHP beneficiaries and other advocates who attended Monday’s meeting of the plan’s trustees requesting the coverage be reinstated.

“His father and I have paid for all his treatment,” Thonen told the board. “I have given him his hormone injections myself.”

With the hormones, Thonen said her son, “became happier and more himself, and the child who hid behind the crossed arms who wouldn’t make eye contact, and slept whenever he could became, as much as a human boy can be, a well-adjusted and happy young man.”

Only rumors

After the meeting, Thonen recalled how in late 2017, she began to see rumors on social media that the coverage they hoped for would disappear.

Nonetheless, they went to a Jan. 2 appointment, only to have their claim denied.

“The denial reason was ‘We don’t cover this,’” Thonen said.

There was no formal notice. The SHP never announced that the policy had sunsetted, nor had the plan included notification in its annual literature.

“We’ve gotten lots of information about how the decision was made to include trans benefits in 2017,” said Noah Lewis, an attorney who leads Transcend Legal, a nonprofit legal advocacy group that advocates for health care rights for transgender people.

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UNC Chapel Hill School of Government employee Max Kadel was depending on the State Health Plan to pay for his hormone treatments and got a surprise when coverage was denied in January, 2018. Photo credit: Rose Hoban

But when Lewis asked why the 2017 reversal of the transgender therapy exclusion policy was allowed to sunset at the end of last year, he was told there wasn’t a vote.

“They explicitly said it was only for one year and they said they would revisit it,” he said. “And they chose not to revisit it.”

That was a blow to Max Kadel, who works at the School of Government at UNC Chapel Hill. He had been pleased his testosterone treatments were being covered in 2017.

“It’s a generic, it’s in the formulary, so the copay for one month’s supply should be five dollars,” Kadel said.

He carefully looked at the documents sent out at the end of 2017 by the SHP to see what would happen in the upcoming year.

“It wasn’t mentioned in [the documents] at all that this exclusion had been reintroduced, so I went into 2018 with the assumption that there was no trans healthcare exclusion,” Kadel said. “It was actually not until I went to purchase my testosterone prescription and found that it was much more expensive than usual, that I found out that this exclusion had been reintroduced.”

Now the medication costs about $40 per month.

“Over the course of a year it adds up,” he said.

Kadel had also been looking forward to getting breast reduction surgery, same as Thonen-Fleck. It costs about $9,000, something he can’t afford out of pocket.

“If there is a cis-gender man with [breasts], he can access the type of chest reduction surgery that I need and that would be covered under the plan, but because I’m transgender, I can’t access it,” Kadel said. “If I were a cis-gender woman and had a chest that was causing me the level of distress my chest causes me, that cis-gender woman’s chest reduction would be covered under the plan.”

De minimis

After a half dozen people spoke at the trustees’ meeting, asking for benefits to be reinstated, one board member, Pete Robie, a physician, recounted how he once had an uninsured transgender patient seeking transition surgery, also known as gender confirmation, or gender affirming, surgery.

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A number of transgender people, family members and advocates attended Monday’s meeting of the State Health Plan’s Board of Trustees in Raleigh. Photo credit: Rose Hoban

“For counseling, medication, surgery and follow-up it was $140,000. That’s the charge for an uninsured patient. For a male-to-female transgender breast augmentation, a separate charge was $60,000,” Robie said. “Even if the cost was half that, with the kind of budget deficit we have, as important as it is to cover it, can we cover it?”

Outside of the meeting, Lewis contested Robie’s numbers, noting that the SHP’s own estimates of the costs of coverage in 2016 found the costs to be small.

An analysis, performed for the SHP by Atlanta-based Segal Consulting, found that for male-to-female surgery, the cost was about $28,000, plus $3,600 for hormonal therapy. For female-to-male surgery, the cost was $56,000 with $7,200 for hormones.

The consultants also estimated only about six males and three females out of the plan’s estimated 750,000 members would seek the therapy each year. That would lead to annual total costs ranging from $344,000 to $862,000 per year, out of $3.2 billion spent by the plan annually.


A review performed by the Human Rights Campaign looking at costs to the government of the City of San Francisco found that city had initially charged employees an extra $1.70 per month to pay for transgender therapy benefits. Within several years the city eliminated the surcharge because the costs were so minimal.

“It’s never been about the cost,” said Lewis. “It’s been about anti-transgender sentiment.”

Headed to court?

Other states have been compelled to provide such care to employees. The most recent example is Wisconsin, where last month a judge told that state’s employee health plan to provide transition therapies to beneficiaries. The deciding judge noted that Wisconsin denied treatment in violation of the Title VII of the Civil Rights Act, as well as a section of the Affordable Care Act that prohibits discrimination in health plans based on sex or disability.

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Noah Lewis from Transcend Legal testifies before the board of trustees of the N.C. State Health Plan about the plan’s policy excluding treatment for transgender therapies on Monday in Raleigh. Photo credit: Rose Hoban

Lewis went on to say that if North Carolina didn’t move to include the transgender benefits for employees, he would likely contact the federal Equal Employment Opportunity Commission.

If the EEOC agrees there’s a “reasonable finding of discrimination and reasonable cause,” Lewis said he’d push the state to settle out of court before suing.

Lewis has two plaintiffs at the ready. Kadel and another person are preparing paperwork to become additional plaintiffs should a court case ensue.

“They could do it today, to remove the exclusion for 2019,” he said. “At any point, they can remove the exclusion, they have the power to do that and they can do it voluntarily.”

According to a spokesman for State Treasurer Dale Folwell’s office, the board of trustees took no further action on the policy Monday.

Update: North Carolina Health News received this comment from the office of State Treasurer Dale Folwell after this story was originally published. 

The State Health Plan’s policy of not covering sex change operations as a benefit, is the same now as it was during the entire eight years of Treasurer Janet Cowell’s administration and all previous North Carolina Treasurers.

The legal and medical uncertainty of this elective, non-emergency procedure has never been greater.

Until the court system, a legislative body or voters tell us that we “have to,” “when to,” and “how to” spend taxpayers money on sex change operations, I will not make a decision that has the potential to discriminate against those who desire other currently uncovered elective, non-emergency procedures.

We empathize with all members’ health conditions, but cannot provide them all with every elective, non-emergency procedure they want.

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Rose Hoban is the founder and editor of NC Health News, as well as being the state government reporter. Hoban has been a registered nurse since 1992, but transitioned to journalism after earning degrees...