Transition-related care includes "gender affirming surgery, cross-sex hormone therapy, or both," according to Aaron Belkin, author of the article, which is published in the New England Journal of Medicine
Helping transgender military personnel transition will cost the military as little at 22 cents per service member per month, or $5.6 million annually, the study contends.
Belkin estimates that 12,800 transgender personnel are currently serving in the U.S. armed forces and, of those, he expects approximately 188 would utilize transition-related care per year.
Surgeries, hormones or both would cost an average of $29,929 over six and a half years per personnel receiving such treatment, according to the study.
"This detailed report underscores what we know to be true from the civilian world," said Kris Hayashi, executive director of Transgender Law Center. "That health care costs for transition-related care make up a fraction of a drop in the bucket of overall health care expenses for employers."
The estimated number of transgender personnel is double that of civilian employees, because transgender people are overrepresented in the military, according to Belkin.
"Before attaining self-acceptance, many transgender women (people born biologically male who identify as women)," Belkin writes, "seek to prove themselves that they are not transgender by joining the military and trying to fit into its hypermasculine culture."
The actual cost may be lower, according to the study, because transition-related care has been shown to mitigate other serious conditions while potentially improving job performance.
The issue of transgender individuals serving in the military was a topic of discussion at the first Republican presidential debate last week.
The purpose of the military is "not to transform the culture by trying out some ideas that some people think would make us a different country and more diverse," said candidate Mike Huckabee. "The purpose is to protect America. I'm not sure how paying for transgender surgery for soldiers, sailors, airmen, Marines makes our country safer."
Last month, Defense Secretary Ash Carter announced a plan to study "readiness implications of welcoming transgender person to serve openly."
The plan includes a new protocol that any personnel diagnosed with gender dysphoria or who identify as transgender will have their paperwork for dismissal from the military reviewed at the highest personnel levels in the Defense Department.
"At a time when our troops have learned from experience that the most important qualification for service members should be whether they're able and willing to do their job, our officers and enlisted personnel are faced with certain rules that tell them the opposite," Carter wrote in a statement last month. "Moreover, we have transgender soldiers, sailors, airmen, and Marines -- real, patriotic Americans -- who I know are being hurt by an outdated, confusing, inconsistent approach that's contrary to our value of service and individual merit."
Belkin, director of the Palm Center, an independent research institute focusing on gender, sexuality, and the military, hopes the study will provide sound data to a potentially polarizing issue.