On November 23, the United States Court of Appeals for the Fifth Circuit overturned a 2017 district court decision that granted the right of individual plaintiffs to challenge a Texas state decision to disqualify Planned Parenthood from its Medicaid program. The overruling decision now allows Texas and Louisiana to exclude Planned Parenthood (and their associated clinics) from their state Medicaid plans. Planned Parenthood in Mississippi, which is also located within the Fifth Circuit's jurisdiction, will also be impacted by this decision.

In October 2015, Planned Parenthood Gulf Coast, Inc. and its affiliates in Texas were disqualified from the Texas Medicaid Program. The Office of Inspector General (OIG) investigated the organization after the Center for Medical Progress (CMP), a pro-life organization, released a video which alleged that Planned Parenthood Gulf Coast headquarters were discussing the possibility of a research partnership with a fetal tissue procurement company.

After the videos surfaced, the OIG sent each provider and affiliate a “Notice of Termination” stating they were “no longer capable of performing medical services in a professionally competent, safe, legal, and ethical manner.” The OIG gave each provider 30 days to respond before sending a Final Notice of Termination.

Planned Parenthood Gulf Coast, Inc. and its Texas affiliates sued in federal court to block the terminations in a preliminary injunction. They claimed that these termination notices violated their rights under 42 USC §1396a(a)(23) State Plans for Medical Assistance and the freedoms granted in the 14th Amendment. They pursued relief under 42 USC §1983 Civil Action for Deprivation of Rights.

The District Court held a three-day evidentiary hearing in which the OIG confirmed it based its decision on the videos released by CMP, evidence from the House of Representatives’ Select Investigative Panel, and the OIG’s consultation with its Chief Medical Officer. They argued that the video showed the intent of a violation of 42 U.S. Code § 289g–1 - Research on Transplantation of Fetal Tissue, which states there is to be “no alteration of the timing, method, or procedures used to terminate the pregnancy was made solely for the purposes of obtaining the tissue….”

This law further elaborates that it “requires researchers to certify that they ‘had no part in any decisions as to the timing, method, or procedures used to terminate the pregnancy made solely for the purposes of the research.” The OIG stated that the videos released indicated that a partnership with a fetal tissue procurement company would be a violation of this law and therefore was no longer qualified to continue providing service as a provider in the Texas Medicaid Program.

The original decision, Planned Parenthood of Greater Tex. Family Plan. & Preventative Health Servs., Inc. v. Smith (W.D. Tex. 2017), “held that §1396a(a)(23) granted rights to the Individual Plaintiffs upon which a §1983 action challenging the OIG’s termination decision could be based.”

The District Court ruled that the OIG “did not have prima facie… evidence, or even a scintilla of evidence, to conclude the bases of termination" and granted an injunction, granting the individual plaintiffs in the case the right to question the state's determination.

The Court of Appeals disagreed, however. The three-judge panel stated the original decision issued a preliminary injunction “based solely on the claims of the Individual Plaintiffs.” They further argued that the court “did not consider whether the Providers were entitled to a preliminary injunction.” The Court of Appeals determined the plaintiffs did not have the right to an injunction because “the text of § 1396a(a)(23) does not unambiguously grant Medicaid patients the right to be involved in or to contest a state agency’s determination that a provider is not 'qualified'.”

In contrast, Judge James Dennis, in his dissent, voiced the possibility that this ruling will leave millions of people within their jurisdiction “vulnerable to unlawful state interference with their choice of health care providers.” Medicaid programs, first enacted in 1965, were designed for lower-income individuals. This ruling could make basic healthcare services, like cancer screenings and annual checkups, out of reach for those who depend on Planned Parenthood services within their Medicaid insurance plans.

Planned Parenthood Gulf Coast, Inc. and its affiliate providers serve over 12,500 Medicaid patients annually in their thirty health centers. They provide “examinations, cancer screenings, testing and treatment for sexually transmitted diseases, as well as basic healthcare for both men and women.”

Even though Planned Parenthood offers a wide range of services for men, women, and the LGBTQ community, it has long been attacked by pro-life organizations, politicians, and policies solely because of its abortion services. This decision is a victory for these organizations and individuals who want to see all Planned Parenthood clinics disqualified from receiving federal funding through all Medicaid programs.

According to Planned Parenthood’s 2019 Annual Report, government reimbursements and grants accounted for 37% of its revenue. However, a breakdown of its affiliate medical services showed that abortion services nationwide only account for 4% of services. The largest portion of services is for STI Testing and Treatment for men and women, Contraception, and Other Women’s Health Services, accounting for 90% of services.

Notably, the Hyde Amendment of 1976 already prohibits federal funds from being used for abortion services except in dire circumstances. Therefore, this removal of Planned Parenthood from Medicaid programs across the country can be seen not as an attempt to curtail abortions but to indirectly defund all federal funds to Planned Parenthood entirely. This move would increase the organization’s need for private and non-governmental funding, possibly increasing the pricing of services which would have an immediate impact on lower-income individuals, which is the population Medicaid was created to help.

Planned Parenthood has not yet moved to appeal this case to the Supreme Court. However, if they do, it faces an even more conservative court than when the case began in 2015. Even though the Supreme Court struck down a Louisiana law that limited access to abortions in the state earlier this year, the makeup of the Court has drastically changed since that ruling. With the Trump administration’s most recent Supreme Court nominee, Amy Coney Barret, now on the Court, and with the passing of Justice Ruth Bader Ginsburg, the pro-choice organization will face a difficult battle to overturn this decision should they seek a Supreme Court decision.