Texas Attorney General Ken Paxton announced Friday that Texas Children’s Hospital will establish the country’s first specialized clinic for patients seeking to reverse the effects of gender-affirming medical treatments, as part of a sweeping settlement that also includes a $10 million payment to the state and the termination of five physicians.
The agreement resolves a 2023 investigation and subsequent lawsuit alleging the hospital violated Texas’ ban on gender-affirming care for minors. The state accused the hospital of using false diagnosis codes to bill Medicaid for banned procedures. The hospital, the largest children’s hospital in the U.S., denied wrongdoing but said it settled to avoid costly litigation.
Under the terms, the new “detransition clinic” will provide free care for the first five years, funded entirely by Texas Children’s. Services will focus on medical interventions to reverse or mitigate the effects of prior gender-affirming treatments, according to Paxton’s office.
Paxton, who is challenging Senator John Cornyn in a Republican primary, framed the settlement as a landmark victory against what he called “twisted, morally bankrupt transgender ideology.” In a statement, he said the deal reflects “an institutional and fundamental cultural shift away from radical ‘gender’ ideology.”
The hospital’s leadership, while insisting they had complied with all laws, said the settlement allows them to move past “a chapter that has been wrought with falsehoods and distractions.” In a statement, representatives added, “We stand proud knowing we will always put our purpose over politics and that we have and will continue to follow the law.”
The case is part of a broader legal and political battle over transgender medical care. In a related development, a federal judge recently blocked the Department of Justice from obtaining transgender youth records from a Rhode Island hospital, highlighting ongoing judicial scrutiny of such investigations.
Paxton’s office said the five physicians fired under the settlement will be permanently barred from practicing at Texas Children’s. The hospital did not name the doctors publicly, citing privacy concerns.
The settlement comes amid a volatile political climate for transgender rights. Critics argue that detransition clinics could stigmatize necessary medical care, while supporters see them as a corrective for what they view as harmful practices. The hospital’s decision to fund the clinic entirely for five years underscores the financial and reputational stakes involved.
Texas Children’s emphasized that its primary mission remains clinical care and research. “Settling will allow us to redirect those precious resources to focus on the life-saving care and groundbreaking discoveries of our exceptional clinicians and scientists,” the hospital said.
