It isn't true, but most people aren't just saying it to be mean, they honestly believe it. Just like people used to think (and some still think) that homosexuality was a mental disorder. Standard medical opinion considers it to be gender identity disorder, but don't let that make you feel like there is something wrong with you if you are experiencing gender dysphoria. As far as treating it like a mental illness, I don't think any medication is going to help someone with gender dysphoria. The best way to help them is to give them hormone treatment and surgery, IF THAT'S WHAT THEY DESIRE. Most transgendered individuals can live a very happy normal life without needing therapy or mind altering drugs. For this reason, I disagree with the notion that we should treat gender dysphoria as a mental illness.