According to the Legislative Budget Board (LBB), HB 778 would have no significant fiscal implications for the State of Texas. According to the fiscal note dated April 3, 2025, any administrative or implementation costs associated with enforcing the bill’s mandate, that health benefit plans cover adverse effects and reversal procedures related to gender transitions, can be absorbed using existing resources within relevant state agencies.

Specifically, the fiscal note reflects feedback from major state entities potentially affected by the bill, including the Teacher Retirement System (TRS), Employees Retirement System (ERS), Health and Human Services Commission (HHSC), and Texas Department of Insurance (TDI). These agencies are expected to administer the new requirements without additional appropriations, suggesting that the bill does not introduce large-scale programmatic expansions or capital needs.

For local governments, including public school districts or county health systems, the fiscal note similarly concludes that no fiscal impact is anticipated. This suggests that either the scope of impacted local plans is limited or that any compliance costs are expected to be minimal and manageable within existing budgets.

Overall, the bill’s financial impact is projected to be fiscally neutral at both the state and local levels, which may help ease concerns among lawmakers focused on budget discipline or cost containment.

HB 778 addresses a critical and previously unregulated gap in the healthcare system by requiring health benefit plans that currently or previously offered coverage for gender transition procedures to also provide coverage for adverse effects, complications, and reversal treatments. This bill ensures that individuals who undergo such treatments, many of which are significant, invasive, and long-term, are not abandoned by the very healthcare infrastructure that once enabled their transition. It guarantees access to necessary care such as reconstructive surgeries, mental health counseling, hormone stabilization, and routine health monitoring aligned with biological sex, regardless of whether the individual remains on the same health plan.

This legislation upholds individual liberty by ensuring that those who choose to reverse or address complications from a gender transition are not denied treatment due to bureaucratic or insurance-related obstacles. It respects the autonomy and dignity of patients who, after medical intervention, find themselves in need of follow-up care that can be critical to their physical and mental well-being. The bill is responsive to the growing population of individuals known as "detransitioners," who often face significant emotional, medical, and financial burdens when seeking reversal or corrective procedures.

Importantly, HB 778 maintains fiscal responsibility. The Legislative Budget Board has determined there will be no significant fiscal impact to the state or local governments, with costs to public health systems anticipated to be absorbed within existing budgets. This supports the principle of limited government by ensuring the measure addresses a genuine policy need without requiring expanded bureaucracy or new appropriations.

Additionally, this bill promotes personal responsibility and free enterprise in a balanced way. It does not prohibit gender transition treatments, nor does it regulate private decisions between patients and providers, it simply requires parity in insurance obligations. Plans that offer or once offered gender transition services must also offer medically necessary services to address their outcomes. This promotes fairness in how medical risks are managed and shared within insurance markets while still allowing providers and insurers flexibility in other respects.

In sum, HB 778 represents a compassionate and measured response to an emerging medical and ethical concern. It expands protections for a vulnerable group of Texans without imposing unnecessary costs on taxpayers or stifling private markets. For those reasons, Texas Policy Research recommends that lawmakers vote YES on HB 778.

• Individual Liberty: The bill enhances individual liberty by ensuring that people who have undergone gender transition procedures, and later experience complications or regret, have access to necessary follow-up or reversal care. It empowers patients to seek medical treatment aligned with their current needs, rather than being bound by a past decision or facing systemic denial of care. This affirms bodily autonomy and freedom of medical choice. It recognizes the rights of individuals to make informed health decisions, even when those decisions change over time.
• Personal Responsibility: The bill encourages personal responsibility by ensuring that the health system acknowledges and supports those facing consequences from prior medical choices. Rather than leaving patients to bear the full burden of expensive reversal treatments or complication management, it ensures that the insurance system, already involved in providing the initial transition care, continues to play a role in the full continuum of care. This fosters a system where individuals are supported through the long-term implications of their decisions without abdicating responsibility.
• Free Enterprise: While the bill does introduce a mandate on insurers, requiring them to offer coverage for a defined set of follow-up and reversal procedures, it only applies to insurers that already provide or have provided gender transition-related services. In this way, it targets existing coverage frameworks rather than dictating new areas of business. Still, this is a regulatory expansion that affects the ability of private insurance plans to fully determine the scope of services they wish to cover. Therefore, it slightly narrows the principle of free enterprise, but in a focused and justifiable context.
• Private Property Rights: By mandating specific coverage terms for insurers and benefit plans, including some retroactive responsibilities, the bill places constraints on how private entities manage risk, structure benefits, and allocate resources. This limits the discretion of insurance companies and employers to contract freely. However, since the bill applies only to plans that voluntarily engage in covering gender transition procedures, it can be argued that it respects property rights to the extent that it holds insurers accountable for the long-term consequences of services they chose to underwrite.
• Limited Government: The bill expands the regulatory role of state government by imposing insurance mandates, which can raise concerns for those favoring minimal state intervention. However, it does so with no new fiscal appropriations and is largely implemented within the existing administrative framework. The bill addresses a specific and demonstrable gap in care, using a targeted approach rather than broad, systemic expansion. As such, it represents a calibrated intervention, arguably consistent with a principled use of limited government to redress market gaps and protect vulnerable populations.

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