A federal judge will hear arguments Wednesday regarding the status of a spending law implemented in July that ceased Medicaid reimbursements for Planned Parenthood as legal challenges progress.
President Donald Trump’s tax and spending bill specifically targets organizations providing abortions that also receive substantial federal Medicaid funds, exceeding $800,000 annually. Planned Parenthood contends that this legislation infringes upon constitutional rights, while anti-abortion groups support its enactment.
An appellate court recently permitted the law to take effect in September as a lower court evaluates Planned Parenthood's assertions.
A report published Wednesday indicated that the new law incurred a staggering $45 million cost in September, with clinics across the country enduring the expenses for Medicaid patients themselves—a model deemed unsustainable by the organization.
Nearly 50% of Planned Parenthood patients depend on Medicaid for essential healthcare services, excluding abortions, which are not covered under the federal program designed for low-income and disabled Americans.
Legal battle
The Planned Parenthood Federation of America, in conjunction with its affiliates in Massachusetts and Utah, along with a prominent medical provider in Maine, initiated lawsuits against Health and Human Services Secretary Robert F. Kennedy Jr. in July. The Maine entity has had to suspend its primary care services while the legal process unfolds.
In response to these losses, seven states—California, Colorado, Massachusetts, New Jersey, New Mexico, New York, and Washington—allocated state funds to mitigate the impact of lost federal Medicaid reimbursements. This initiative has offset approximately $200 million of the estimated $700 million that Planned Parenthood spends annually on Medicaid patients.
Due to the funding shortcomings, several clinics are shifting to requiring out-of-pocket payments from Medicaid patients, or may close entirely, adding to the already 20 Planned Parenthood clinics that have shuttered since July and the 50 that have closed since Trump took office a second time.
“The consequence is patients will have to make unbearable choices regarding needed services,” stated Planned Parenthood President and CEO Alexis McGill Johnson during an interview with The Associated Press.
Abortion at the heart of the debate
Carol Tobias, president of the National Right to Life Committee, endorsed Trump’s legislation as a positive measure. Despite the absence of federal funds being directly used for abortions, she mentioned that taxpayer dollars indirectly support abortion services, creating moral and ethical conflicts for many.
“To be compelled to fund these services is deeply objectionable,” Tobias remarked, suggesting that Planned Parenthood could cease offering abortions to retain its services for vulnerable individuals.
In contrast, Planned Parenthood officials reaffirmed their commitment to abortion services. Johnson stated firmly, “The government should not be involved in dictating results of pregnancies.”
A range of services hit
Although Planned Parenthood is known as the nation's largest abortion provider, abortions accounted for only 4% of medical services in 2024, based on the organization’s annual report. The vast majority of services—about 80%—included testing for sexually transmitted infections and contraception, with cancer screenings, primary care, and behavioral health services comprising the remainder.
Jenna Tosh, CEO of Planned Parenthood California Central Coast, highlighted that the Medicaid cuts jeopardize both abortion and fundamental health services. Approximately 70% of patients at her organization depend on Medicaid for care.
“For many of our patients, we are their primary healthcare provider,” Tosh noted. “These cuts unravel the entire healthcare safety net for those most in need.”
