The US Court of Appeals for the Eighth Circuit Friday issued a permanent injunction against the enforcement of Section 1557 of the Affordable Care Act (ACA), which would require medical providers to provide gender-affirming medical services to transgender individuals.

Two groups of Catholic employers and health care providers, the Religious Sisters of Mercy and the Catholic Benefit Association (CBA), challenged the ACA’s prohibition on discrimination “based on race, color, national origin, sex, age or disability in certain health programs and activities.” According to the Equal Employment Opportunity Commission (EEOC) and the Department of Health and Human Services (HHS), sex encompasses gender identity.

The Catholic groups argued that the regulation “not only forces healthcare professionals to violate their medical judgment, it also forces them to violate their deeply held religious beliefs” and that Title IX does not apply to entities “controlled by religious organizations.” The United States District Court for the District of North Dakota agreed. The Eight Circuit’s Friday decision affirmed the district court and held that “intrusion upon the Catholic Plaintiffs’ exercise of religion is sufficient to show irreparable harm.”

HHS believes that transgender Americans deserve protection in healthcare, explaining that “more than 40 percent of transgender respondents in one survey said their health insurance company denied them coverage for a gender-affirming surgery,” and a “similar proportion” were denied insurance coverage for hormone replacement therapy.

The challengers noted that HHS and EEOC have not yet evaluated how the Religious Freedom Restoration Act (RFRA) “and other religious exemptions might apply to such religious entities.” In its original regulation, HHS said it “would comply with RFRA and all other legal requirements.”