CHOP transgender care under scrutiny for ‘fraudulent billing practices,’ DOJ says

President Donald Trump’s administration is escalating its legal fight against children’s hospitals in Philadelphia and Pittsburgh where doctors have treated transgender youth seeking gender-affirming medical care.

In court documents filed within the last week, the U.S. Department of Justice says it has “evidence” that raises questions about “fraudulent billing practices.”

Federal officials are looking into whether doctors at Children’s Hospital of Philadelphia (CHOP) and Children’s Hospital of Pittsburgh were fudging or lying about diagnoses to get private and public health insurance companies to cover off-label drug prescriptions used to treat patients with gender dysphoria — a medical condition in which a person’s body does not match their gender identity.

The DOJ’s assertions came in the form of sworn statements, or “declarations,” submitted in Pennsylvania federal district courts as part of a federal investigation into potential criminal and civil violations of the Food, Drug and Cosmetic Act (FDCA).

Federal lawyers earlier this year sent subpoenas claiming the right to examine private patient medical records at at least 20 hospitals nationally, including CHOP and the Pittsburgh hospital, which is part of University of Pittsburgh Medical Center (UPMC).

CHOP’s Gender and Sexuality Development Program, created in 2014, is one of the nation’s largest such clinics and provides medical care and mental health support to hundreds of new families each year. Officials at the Center City hospital did not reply to a request for comment on the DOJ’s latest filings.

A UPMC spokesperson said Wednesday the declaration contains “no evidence” or specific “allegation of fraud” by UPMC or its children’s hospital.

UMPC announced it would stop providing gender-affirming care for patients under age 19 amid pressure from Trump’s administration and has not sought legal relief from the federal subpoena.

The new court filings use largely identical statements to lay out the DOJ’s case for obtaining the subpoenaed documents from CHOP and UPMC. To date, they offer the most comprehensive public window into what investigators are looking for.

“Given the significant number of children treated at CHOP’s gender clinic, combined with its knowledge that potential federal healthcare offenses may systematically be occurring in the provision of gender-related medical care for minors, the government has ample reason to suspect that such offenses may be occurring at CHOP,” said Lisa Hsiao, acting director of the DOJ’s Enforcement and Affirmative Litigation Branch, formerly known as the Consumer Protection Branch.

Beyond that, Hsiao wrote, “the government is aware of information particular to CHOP that raises concern that federal healthcare offenses may be occurring there.”

The DOJ’s key focus is how doctors are prescribing puberty blockers and hormones “off-label,” meaning for a condition not specifically approved by the U.S. Food and Drug Administration.

Once a drug is approved by the FDA, it is legal for doctors to prescribe it to treat other conditions that could benefit from the medication. Off-label prescribing is a common and widely accepted medical practice, especially in pediatrics.

The American Academy of Pediatrics and other major medical associations, citing research, have maintained that using these medications to provide gender-affirming care for minors is safe, effective, and medically necessary for their mental health.

Yet Trump’s administration says that doctors who prescribe puberty blockers and hormones to patients under age 19 are engaging in chemical mutilation, likening it to child abuse, and that the medications are unsafe for youth.

» READ MORE: Transgender kids’ lives are on the line as CHOP fights Trump over patient medical records, parents say

The legal fight is playing out in multiple court cases in Pennsylvania and across the nation.

A federal judge in Boston last month ruled in favor of Boston Children’s Hospital and limited the DOJ subpoena, describing the federal demand for private patient records as overly broad and lacking a legitimate reason.

This month’s DOJ court filings were made in Pennsylvania-based cases involving former patients and parents of children who have received gender-affirming care at CHOP and UMPC. They are asking federal judges to protect their right to keep their medical records private and are represented by the Public Interest Law Center, a Philadelphia-based nonprofit that advocates for the civil, social, and economic rights of marginalized communities.

In the case involving UMPC, patients and their parents say the DOJ is seeking to criminalize legal medical care it dislikes, describing the subpoena as a “raw use of government power to advance that policy agenda.”

The DOJ argued that the parents and patients have no standing to challenge the subpoena.

Hsiao’s statements in the UMPC and CHOP cases broadly allege that the DOJ suspects doctors are using “incorrect diagnosis and/or billing code” to prescribe medications “because they know that certain insurance plans may not cover off-label prescription of puberty blockers or cross-sex hormones for gender-related treatment.”

In the CHOP case, the government added three paragraphs with specific accusations involving doctors’ use of a medical diagnosis known as “central precocious puberty,” which is when children show signs of puberty at an abnormally early age.

The FDA has approved puberty blockers, such as Lupron and Zoladex, to treat central precocious puberty.

Doctors who provide gender-affirming care can legally prescribe puberty blockers off-label to treat gender dysphoria. They are used to buy time for adolescents who are questioning their gender identity. They slow development of breasts, ovaries, and testicles.

Now the DOJ is disclosing that it has hired government contractors to analyze “extensive anonymized insurance claims” submitted by CHOP providers, Hsiao said in the statement.

The billing codes and data show that between 2017 and 2024, CHOP providers diagnosed 250 minors with central precocious puberty at age 10 or older, “including numerous teenagers aged 14 to 18.”

“This is well beyond the age at which children are typically diagnosed with precocious puberty,” Hsiao stated. The government suspects doctors are improperly using the precocious puberty diagnosis to get insurance coverage for treatment of gender dysphoria, she said, but provided no further evidence.

At least one part of Hsiao’s statement related to CHOP appeared to be incorrect.

The statement said the DOJ was “aware of a lawsuit just filed this year that details very concerning allegations of a minor being put on puberty blockers after his first visit and cross-sex hormones after his second with no meaningful assessment.”

The Inquirer was unable to find any such lawsuit filed against CHOP. After a reporter asked for clarification from the DOJ, the declaration was refiled, deleting mention of “a lawsuit just filed.”

Late Tuesday night, lawyers for CHOP filed a motion saying the DOJ has never made these accusations in its separate case seeking to limit the federal subpoena’s scope.

CHOP says the judge in its subpoena case should not consider the new accusations. CHOP lawyers also noted that Hsiao stated, under oath, that the government is aware of a lawsuit, but then replaced the filing, omitting the reference to a lawsuit without explanation.

If the judge intends to consider Hsiao’s statement, CHOP lawyers asked for permission to file a response to it.