A Texas hospital’s court settlement with conservative officials brings a lengthy legal campaign against the sex-change industry to a crescendo.
Texas Children’s Hospital (TCH) in Houston agreed to create the country’s first “Detransition Clinic,” pay $10 million and fire five physicians over its transgender medical program, state and federal leaders announced May 15. A three-year investigation by Republican Texas Attorney General Ken Paxton and the Department of Justice (DOJ) made the costs of defending TCH’s secretive, scandal-prone practices outweigh the benefits, in the hospital’s own view.
BREAKING: I just made history by securing a landmark healthcare fraud settlement that creates the nation’s first-ever Detransition Clinic and secures $10 million from Texas Children’s Hospital for “transitioning” kids. pic.twitter.com/EnL5F7JMlY
— Attorney General Ken Paxton (@KenPaxtonTX) May 15, 2026
Paxton and the DOJ’s pressure campaign brought unprecedented victories for the transgender movement’s opponents and gives a possible blueprint for them to drive gender ideology out of America’s medical system.
“We are fighting and we’re winning and we’re producing results,” former TCH employee Dr. Eithan Haim, who first exposed the hospital’s secret child sex-changes with leaked documents in 2023, told the Daily Caller News Foundation. Haim called the settlement a “head-on-the-spike victory of the conservative movement against a golden calf issue for the radical left.”
“We were able to pursue this investigation, this civil process, and make these people pay in a really big way,” the surgeon told the DCNF.
TCH called the probe “wrought with falsehoods and distractions” in a statement to the DCNF. “To be clear — we are settling to protect our resources from endless and costly litigation,” the statement said.
“We stand proud knowing we will always put our purpose over politics and that we have and will continue to follow the law,” the hospital said.
‘Very Optimistic Signs’
TCH’s legal saga began when journalist Chris Rufo published medical records obtained from Haim in May 2023, showing that the hospital secretly transitioned children despite publicly promising to stop. Paxton had already declared such procedures “child abuse” under state law in a February 2022 legal opinion.
Days later, Paxton launched the investigation that eventually brought about the landmark settlement. Former TCH nurse Vanessa Sivadge went public in 2024 about the hospital allegedly falsifying patients’ records with fake diagnoses in order to bill taxpayers for transgender procedures under Medicaid, which became another focus of the Texas probe.
The Biden administration’s DOJ investigated and indicted Haim with the Department of Health and Human Services’ backing on charges of violating medical privacy law. However, Republican Texas Gov. Greg Abbott signed a ban on child sex changes in 2023 that withstood legal challenges, the hospital announced again that it was ending transgender “care” that year and the Trump administration dropped Haim’s charges in January 2025 after public outcry.
Even after those wins, Haim never thought the results of TCH’s legal troubles would be so “monumental,” he told the DCNF.
“Never in a million years, dude, would I have ever imagined this outcome,” Haim said. “Like, if a year ago someone told me, I’d be like, ‘That’s stupid. That’s like a fairy tale.’”
Paxton kicked off his 2023 probe with a May 2023 “Request to Examine” that required TCH to hand over records on its transgender medical practices. The request warned that hiding the information would be unlawful and could cost the hospital its right to do business in Texas.
The attorney general accused TCH of “billing Texas Medicaid for unallowable and illegal ‘gender-transition’ interventions, including by using false diagnosis codes,” a May 15 statement from his office says. The DOJ alleged the hospital violated the Federal Food, Drug, and Cosmetic Act regulating medication, the fraud-related False Claims Act and other “fraud and conspiracy laws.”
The impossible was done by @KenPaxtonTX and his team at the @TXAG‘s office.
Because of their hard work, the country’s first detransitioner clinic will be opening at Texas Children’s Hospital.
I cannot believe this happened. https://t.co/92Kdp9fOv8
— Eithan Haim MD (@EithanDHaimMD) May 15, 2026
“We produced over 5 million documents and conducted multiple internal and external investigations,” the hospital told the DCNF. “These efforts have required significant staff time and financial resources to defend ourselves.”
TCH still is not out of the woods. Paxton’s settlement requires the hospital’s upcoming “Detransition Clinic” to provide free sex-change reversal treatment for its first five years, terminate five doctors involved in sex changes, “implement a host of compliance and ethics measures” and change its bylaws to punish physicians who perform the procedures going forward, his office said.
The public will have to watch whether TCH lives up to its agreements, but they represent “very optimistic signs” about pro-transgender radicals giving up, Haim told the DCNF.
The DOJ appears to be following a similar legal playbook for other medical institutions. The department announced in July that it sent more than 20 subpoenas to doctors and clinics involved in child sex changes over possible fraud, “false statements” and other claims.
Targeting medical facilities for health care fraud could prove more effective than medical malpractice lawsuits from former patients, according to Haim. Malpractice cases often rely on courts’ interpretations of vague concepts like “standards of care” rather than hard evidence of fraudulent records, Haim told the DCNF.
“For juries, there’s a lot of wiggle room in those cases … judges could just be like, ‘No, fuck you, we’re not allowing this evidence in or that,’” Haim said about malpractice suits.
Despite Texas and the Trump administration putting TCH through the wringer, the hospital claims to have been exonerated by their probe.
“All reviews and investigations continue to support the facts — we have been compliant with all laws,” the hospital told the DCNF.
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