The nation's largest children's hospital has agreed to a legal settlement with Texas and the Trump administration over gender-affirming care for transgender youth that includes a $10 million payment to the state, the administration and Texas Attorney General Ken Paxton announced Friday.
Texas Children's Hospital, based in Houston, said in a statement that it had agreed to the settlement “to protect our resources from endless and costly litigation.”
The hospital, which serves more than 1 million patients annually, said Paxton's office and the U.S. Department of Justice has investigated its care for three years, forcing it to “navigate an unconscionable campaign of mistruths and mischaracterizations.”
The hospital announced in 2022 that it would stop gender-affirming hormone treatments for minors after Paxton issued a legal opinion calling such care “child abuse” and Gov. Greg Abbott directed the state's child welfare agency to investigate reports of care as abuse. In 2023, Texas became the most populous state to ban gender-affirming care for minors — at least 27 ban or restrict it — and the U.S. Supreme Court ruled in June 2025 that states can do so.
Paxton said the settlement will require Texas Children's to set up a “detransition clinic” to provide free care to transgender patients for five years to “reverse the damage” from gender-affirming care. He described it as the first “detransition clinic” of its kind in the nation, although that could not immediately be confirmed.
“This historic settlement reflects an institutional and fundamental shift away from radical ‘gender’ ideology,” Paxton said in announcing the settlement.
Paxton’s office did not release a copy of the agreement, and the statement from Texas Children’s did not discuss its specific terms.
The leader of the LGBTQ rights group Equality Texas said Texas Children's “has lost its integrity and put politics over patients” and called the settlement “embarrassing.”
“Paxton is blackmailing a hospital system into creating a resource that no one is asking for," CEO Brad Pritchett said in a statement. “It ignores the actual science and years of data about the overwhelming benefits of gender-affirming care.”
Under Trump, the U.S. Department of Health and Human Services has moved to use its regulatory power to block gender-affirming care for minors, and the DOJ has demanded access to providers' records. Acting U.S. Attorney General Todd Blanche said in a statement Friday that the DOJ would “use every weapon at its disposal” to stop gender-affirming care for children.
Paxton is running for the U.S. Senate, and he announced the settlement less than two weeks before a May 26 runoff with him locked in a tight race to unseat GOP incumbent Sen. John Cornyn. President Donald Trump — who has aggressively sought to roll back transgender rights — has not publicly endorsed a candidate in the race.
Most major medical groups see access to gender-affirming care as important for people with gender dysphoria. Transgender youth, parents and providers have described it as life-saving for youth who are depressed or suicidal because their gender identities do not match the sex assigned them at birth.
Gender-affirming care may include counseling, medications that block puberty, hormone therapy to produce physical changes or surgeries to transform chests and genitals, although those are rare for minors.
The hospital said it fully cooperated with Paxton's office and the DOJ, produced more than 5 million documents and did its own internal investigations. All of them showed that it never violated the law, the hospital said.
“These efforts have required significant staff time and financial resources to defend ourselves,” its statement said. “This settlement will allow us to redirect those precious resources to focus on the life-saving care and groundbreaking discoveries of our exceptional clinicians and scientists.”
Paxton said the agreement also requires Texas Children's to fire — “and never again hire” — five doctors who provided gender-affirming care, agree never to provide such care and to change its bylaws so that any doctor violating the state law automatically loses any privileges at the hospital.
The $10 million payment will go to the state's Medicaid program. Paxton had accused the hospital of submitting false billings, an allegation it rejected.
