File this under “should have seen it coming.” Last week the Obama administration warned officials in Texas that excluding Planned Parenthood from the state’s Medicaid program “may be in conflict with federal law.” Texas announced last month it was kicking Planned Parenthood out of its Medicaid program in light of what the state called “acts of misconduct” revealed by undercover videos from the Center for Medical Progress.
Those videos, if you recall, show Planned Parenthood officials admitting to various things that violate state and federal laws on abortion, like altering the timing or method of an abortion in order to procure organs and body parts, failing to train staff how to handle blood and tissue, and failing to comply with regulations meant to prevent the spread of infectious diseases.
Texas officials cited these and other violations, like illegal billing practices, in their letter to Planned Parenthood Gulf Coast, and explain in some detail how the state’s rules for Medicaid providers work and on what grounds providers can be kicked out of the program. The charges, taken as a whole, are pretty serious.
The problem with all this, according to Obama administration officials, is that federal Medicaid law prohibits states from telling Medicaid enrollees—the patients—where they’re allowed to get healthcare services. Medicaid is an entitlement program, so anyone who’s enrolled is supposed to be able to go to “any qualified provider,” that is, any provider approved to participate in the Medicaid program.
States Exclude Medicaid Providers All the Time
But states determine who’s a qualified provider, not the federal government. States might not be allowed to decide who’s eligible for Medicaid or what benefits Medicaid covers, but they do get to decide which providers in their state qualify to be in the program. That’s really one of the only things they get to decide about Medicaid.
To that end, every state has rules for how a provider enrolls in Medicaid. There are standards and so forth, and all states have a process for kicking providers out if they fail to meet those standards or break the rules. This isn’t terribly complicated stuff. In fact, it’s pretty routine. So routine that Texas publishes a list of excluded providers every month and urges Medicaid providers to check the list monthly to make sure none of their employees or suppliers is on it. Anyone can download a list of all the providers that have ever been excluded from the Texas Medicaid program. It numbers in the thousands.
What’s more, the Affordable Care Act requires states to exclude a provider or supplier from its Medicaid program if they have been excluded from Medicare or from a Medicaid program in another state (which means, in theory, all other states would have to exclude Planned Parenthood now that Texas has done so).
Goodbye, States; Goodbye Division of Power
So when the Obama administration sends a letter to Texas officials warning them that excluding Planned Parenthood “might be in conflict with federal law,” there’s good reason to suspect that federal law is not primarily what the feds have in mind. It’s hard not to suspect that they have something rather more political in mind, given how the Planned Parenthood videos and the controversy around them don’t seem to be going away.
That’s not at all surprising. But what is surprising—and what should worry every American, no matter what their view of Planned Parenthood—is that the federal administrative state, in its drive to commandeer state governments, no longer so much as pays lip service to the idea that states have even a marginal role in running programs like Medicaid, which consumes nearly a third of most states’ budgets. Federalism has long been a contemptible and ridiculous thing to Washington DC, but at least it was couched in the pretense of cooperation.
At long last the pretense is falling away. States will henceforth do as they’re told. State officials will ensure that federal bureaucrats’ preferred policies are enacted, and if not, the state will be made to suffer—it will be deprived of funds, it will face legal action, it will be pilloried by the White House’s handmaidens in the national press. It will feel the full weight of the behemoth bearing down upon it.
It’s going to take a state like Texas to stand up to all that. Stay tuned.
John is the director of the Center for Health Care Policy at the Texas Public Policy Foundation in Austin, Texas. Follow him on Twitter.