Efforts to defund Planned Parenthood on the state level took a big hit yesterday when the administration finally weighed in and deemed Indiana's effort to prohibit Planned Parenthood from receiving Medicaid funding illegal. A letter from Center for Medicare & Medicaid Services (CMS) head Donald Berwick made clear that "Medicaid programs may not exclude qualified health care providers from providing services that are funded under the program because of a provider's scope of practice. Such a restriction would have a particular effect on beneficiaries ' ability to access family planning providers."
Indiana was the first to sign a funding ban into law, but it's not the only state considering it. To those states HHS also issued a memo re-iterating the point that denying Medicaid funding because of the services a clinic provides violates the Social Security Act.
On the one hand, it's good to see the administration taking a stand on the issue after what seems like months of reproductive rights organizations and the ACLU fighting alone. On the other hand, now that HHS has determined laws like Indiana's are illegal and asks states to comply with the law, it's unclear what sort of penalties await states that don't comply. Politico's Sarah Kliff reports that, according to CMS, all of Indiana’s federal Medicaid funding, or two-thirds of the state’s $5.9 billion Medicaid budget, are at stake. It's a punishment that should scare states into following the law, but it also punishes the states' poor rather than the legislators who are incurring the penalty.
In the past, states have always complied with CMS in such disputes, so there's no history to go on to judge what the punishment might be. And now that Indiana Gov. Mitch Daniels isn't running for president, it's not hard to imagine him complying. But this year's attacks on Planned Parenthood are unprecedented both in the sheer number of new laws and their scope, and it's not unthinkable to imagine states casting off Medicaid funding and blaming the administration for the loss of healthcare access rather than comply. If Republicans in Congress are hoping to slash Medicaid this summer, it's not unthinkable that Republican statehouses won't think losing Medicaid funding is such a bad punishment either.
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