You might find this interesting:
https://www.researchgate.net/publication/266423271_Medical_Aspects_of_Transgender_Military_Service. It reviews the medical issues, pointing out that the military accepts the same kinds of risks and requirements for other conditions. The issue here is ideological, not medical.
Many things relating to the transgendered rapidly turn into ideological issues, it would appear.
The paper does make a number of interesting points, although ultimately I am still minded to conclude that military leadership is best placed to determine whether the needs of any particular individual can be met in a war zone and, crucially, whether meeting such needs would compromise combat effectiveness.
It's very easy to focus on the individual as if meeting their needs were the only thing that mattered but it is also important to consider whether the presence of any given individual would compromise the effectiveness of their unit. To take a somewhat silly example, there's no medical reason that I know of why I shouldn't deploy into a war zone. But there is the matter that I'm a bit overweight and nowhere near as fit as your average soldier. If you put me into a combat unit I'd impose an added burden on everyone else in the unit because I would struggle to keep up with the rest. So it's one thing to be able to meet any needs I had, but my presence would compromise the effectiveness of the rest of the unit. If the unit was 12 men strong the commander would have to either treat the entire unit as being a slow-moving one, or treat it as an 11-strong unit and figure I'd be a bonus if I got where I needed to be in time and without being shot.
The abstract also made some interesting points that suggested there's more behind it than immediately meets the eye. From the abstract (emphasis is mine):
Our conclusion is that there is no compelling medical reason for the ban onservice by transgender personnel, that the ban is an unnecessary barrier to health care access for transgender personnel, and that medical care for transgender individuals should be managed using the same standards that apply to all others. Removal of the military’s ban on transgender service would improve health outcomes, enable commanders to better care for their troops, and reflect the military’s commitment to providing outstanding medical care for all military personnel.
Why is a ban on military service considered an "unnecessary barrier to health care access", unless the primary goal of joining up was to get medical treatment? If people are signing up to get medical treatment for a condition they are signing up for the wrong reasons, and that alone should be enough to disqualify them whatever the nature of the condition.
How does removing a ban on the transgendered enable commanders to better care for their troops? A commander can care for his troops regardless of who his troops are and, if anything, adding individuals with very particular (and potentially demanding) needs would make it harder to care for the rest of the troops. As above, this applies whatever the nature of the need.
How would removing a ban on the transgendered do anything to change the military's commitment to provide medical care for all personnel, unless the primary purpose in signing up was to receive gender realignment treatments? The purpose of the military is to provide military capability, not a convenient way to receive medical treatments that might otherwise be unavailable.
While the paper does contain a number of interesting points these statements within the abstract leave me struggling to regard it as being impartial.