H.R. 3492, Protect Children’s Innocence Act

Legislation Summary

H.R. 3492 would create new criminal penalties for providing certain surgeries and drug treatments to minors that assist with them in transitioning genders (sometimes referred to as gender-affirming care). The act also would prohibit traveling between states or using interstate commerce in relation to those activities. Procedures related to the physical health of a minor would be exempt from the act’s prohibitions.

Estimated Federal Cost

The estimated budgetary effect of H.R. 3492 is shown in Table 1. The costs of the legislation fall within budget function 550 (health).

Basis of Estimate

For this estimate, CBO assumes that H.R. 3492 will be enacted in fiscal year 2026. This estimate is based on data on federal Medicaid and Children’s Health Insurance Program (CHIP) spending for these services from the Transformed Medicaid Statistical Information System (T-MSIS), as well as CBO’s baseline growth rate for Medicaid spending on children.

Direct Spending and Revenues

CBO estimates that enacting H.R. 3492 would decrease direct spending by $445 million over the 2026-2035 period. Although the act would not amend federal Medicaid or CHIP statutes, CBO expects that federal Medicaid and CHIP spending on gender-affirming care would decline because the act would criminalize certain treatments. State Medicaid agencies would be expected to deny coverage for procedures that are illegal under federal law, and the federal government could determine that such services do not qualify for federal matching funds. In practice, health care providers also would be unlikely to submit Medicaid claims for such treatments to avoid criminal liability. Based on T-MSIS claims data, CBO estimates that in 2023, states spent $35 million on those services which resulted in $22 million in federal matching funds.

Additionally, CBO estimates that a small number of medical providers would be subject to criminal penalties under the act. Criminal fines are recorded as revenues, deposited into the Crime Victims Fund, and later spent without further appropriation. Because CBO expects that state Medicaid agencies and health care providers would generally comply with the requirements in the act, CBO estimates that penalty collections under H.R. 3492 would increase direct spending and revenues by less than $500,000 over the 2026-2035 period.

Spending Subject to Appropriation

Based on the costs of similar activities, CBO estimates that the administrative costs for the Departments of Health and Human Services and Justice to implement H.R. 3492 would be less than $500,000 over the 2026-2030 period. Any related spending would be subject to the availability of appropriations.

Pay-As-You-Go Considerations

The Statutory Pay-As-You-Go Act of 2010 establishes budget-reporting and enforcement procedures for legislation affecting direct spending or revenues. The net changes in outlays that are subject to those pay-as-you-go procedures are shown in Table 1.

Increase in Long-Term Net Direct Spending and Deficits

CBO estimates that enacting H.R. 3492 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2036.

Mandates

H.R. 3492 would impose intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) by prohibiting medical professionals and medical institutions (including those publicly owned) from providing gender-affirming procedures and drug treatments to minors. The cost of this mandate would be the lost revenue to medical professionals and institutions who would no longer be able to provide these procedures.

Using data on the estimated number of minors who have undergone gender-affirming care and the average total cost of gender-affirming care for an individual, CBO estimates that the lost revenue to medical institutions and providers would be about $105 million per year over the 2026-2030 period. This amount includes the decrease in federal spending because that is a portion of lost revenue for medical providers. Using data on the breakdown of private and publicly owned hospitals, the intergovernmental costs are about $16 million per year over the 2026-2030 period. The private-sector costs are about $89 million per year over that period. Therefore, CBO estimates that the cost of this mandate is below the intergovernmental and private-sector thresholds established in UMRA ($103 million and $206 million in 2025, respectively, adjusted annually for inflation).

The act also would impose an intergovernmental and private-sector mandate by prohibiting medical professionals and medical institutions from transmitting communication related to, or facilitating, the medical procedures and drug treatments described above. The cost of this mandate is compliance with those provisions. CBO estimates that there is no cost associated with these mandates.

The act also would impose a private-sector mandate by prohibiting anyone from assisting a minor to receive gender-affirming care. The act would impose criminal penalties on activities that are currently lawful in many states. CBO estimates that there is no cost to comply with this provision.

Estimate Prepared By

Federal Costs: 
Jeremy Crimm (for criminal penalties) 
Carolyn Ugolino (for the Children’s Health Insurance Program and Medicaid)

Mandates: Erich Dvorak

Estimate Reviewed By

Sean Dunbar
Chief, Low-Income Health Programs and Prescription Drugs Cost Estimates Unit

Justin Humphrey
Chief, Finance, Housing, and Education Cost Estimates Unit

Kathleen FitzGerald 
Chief, Public and Private Mandates Unit

Chad Chirico 
Director of Budget Analysis

Estimate Approved By