Federal Court Blocks Indiana Effort to Defund Planned Parenthood

A federal court has blocked an Indiana law that would cut off Medicaid funds to Planned Parenthood because its clinics perform abortions.

The 7^th U.S. Circuit Court of Appeals Tuesday (October 23) upheld a lower court’s injunction against the law which barred the state from contracting or making grants — federal funding included — to “any entity that performs abortions or maintains or operates a facility where abortions are performed.”

In a 2-1 decision, the Chicago-based court said the law violates “patients’ statutory right to obtain medical care from the qualified provider of their choice.” That’s because it excludes Planned Parenthood from Medicaid funding for a reason “unrelated to its fitness to provide medical services.”

Though the decision applied only to the three-state circuit — Indiana, Wisconsin and Illinois — it could set a precedent in litigation stemming from moves to defund Planned Parenthood in several other states, including Arizona, Texas and Kansas.  Last week, a federal judge in Phoenix blocked Arizona’s similar law.

The American Civil Liberties Union cheered the Indiana ruling. It had joined Planned Parenthood in challenging the law, arguing it would deprive thousands of low-income women access services including birth control, cancer screenings and family planning.

“This law was an attempt by politicians to punish organizations that are providing legal services,” Talcott Camp, deputy director of the ACLU Reproductive Freedom Project, said in a statement. “Elected officials should not place politics above women’s health.”

In 2010, Planned Parenthood offered Medicaid services to 9,300 Indianans and received $1,360,437 in Medicaid reimbursement.

Indiana has not yet said whether it will appeal the decision. 

“The people’s elected representatives in the Legislature decided they did not want an indirect subsidy of abortion services such as payroll and overhead to be paid with taxpayer’s dollars and so crafted this law,” Attorney General Greg Zoeller said in a statement.  

Federal law — the so-called “Hyde Amendment” — already prohibits the use of federal funds for abortions, except in cases of rape, incest or when a mother’s health is at risk. Indiana has a similar law. But the state’s GOP-controlled Legislature wanted to go further, by preventing what its members considered indirect support for abortions.  

So in 2011, it passed the law in question, which Governor Mitch Daniels signed in May. But that policy runs afoul of Medicaid regulations, the appeals court said.

States may set “reasonable standards relating to the qualifications of providers,” Judge Diane Sykes wrote for the majority. “This authority, however, does not suggest that states are free to ascribe any meaning to the statutory term ‘qualified.’” Doing so, wrote Sykes “would lead to strange results.”

“This would open a significant loophole for restricting patient choice, contradicting the broad access to medical care that (the regulation) is meant to preserve,” she wrote.

Denying Medicaid funding to Planned Parenthood would cause the provider “immediate irreparable harm,” U.S. District Judge Tanya Walton Pratt of Indianapolis wrote in May, forcing it to lay off dozens of employees, close clinics and stop serving many patients — a conclusion Indiana did not dispute. Meanwhile, an impasse with the federal government could put the state at risk of losing some $5 billion in annual funding that benefits almost 1 million Hoosiers.

Republican moves to defund Planned Parenthood are part of the party’s even broader efforts to restrict abortion. In 2012, at least 13 states passed laws restricting abortion in some way, as Stateline has reported. The previous year, 92 such measures passed in 24 states.