Continuing his commentary on government indifference toward AIDS, Kramer wrote Just Say No, A Play about a Farce in 1988. In the dramatic work he highlighted the sexual hypocrisy in the Reagan and Koch administrations that allowed AIDS to become an epidemic; it concerns a First Lady, her gay son, and the closeted gay mayor of America's "largest northeastern city". Its New York production, starring Kathleen Chalfant, Tonya Pinkens, and David Margulies, was prized by the few who came to see it after its negative review by The New York Times. Social critic and writer Susan Sontag wrote of the piece, "Larry Kramer is one of America's most valuable troublemakers. I hope he never lowers his voice."
In 1988, stress over the closing of his play Just Say No, only a few weeks after its opening, forced Kramer into the hospital after it aggravated a congenital hernia. While in surgery, doctors discovered liver damage due to Hepatitis B, prompting Kramer to learn that he was HIV positive. In 2001, at the age of 66, Kramer was in dire need of a liver transplant, but he was turned down by Mount Sinai Hospital's organ transplant list. People living with HIV were routinely considered inappropriate candidates for organ transplants because of complications from HIV and perceived short lifespans. Out of the 4,954 liver transplants performed in the United States, only 11 were for HIV-positive people. The news prompted Newsweek to announce Kramer was dying in June 2001; the Associated Press in December of the same year reported Kramer's death. Kramer became a symbol for infected people who had new leases on life due to advances in medicine. "We shouldn't face a death sentence because of who we are or who we love", he said in an interview. In May 2001, the Thomas E. Starzl Transplantation Institute at the University of Pittsburgh, which had performed more transplants for HIV positive patients than any other facility in the world, accepted Kramer as a potential transplant recipient. Kramer received a new liver on December 21, 2001. In April 2019 he suffered a broken leg.