Metropolitan News-Enterprise


Friday, August 23, 2013


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Ninth Circuit Panel Strikes Down Anti-Abortion Law in Arizona

Statute, Which Never Took Effect, Would Have Banned Providers From Medicaid




An Arizona law that bars a healthcare provider from treating Medicaid patients if it also provides abortion services violates the federal Medicaid Act, the Ninth U.S. Circuit Court of Appeals ruled yesterday.

The panel said Ariz. Rev. Stat. § 35-196.05(B), also known as Bill 2800, is unenforceable because it deprives patients of the free choice of qualified provider that the federal act guarantees.

The Medicaid Act already bars Medicaid from paying for abortions, except where the patient’s life is endangered or in cases of rape or incest. The Arizona law took that a step further, barring providers who perform abortion services—except in cases of medical necessity, rape, or incest—from receiving Medicaid reimbursement for other services, including cancer screenings.

Planned Parenthood of Arizona, an obstetrician who provides Medicaid services in his private practice, and three patients sued before the law took effect, and U.S. District Judge Neil V. Wake of the District of Arizona granted a preliminary injunction barring the state from enforcing it. He subsequently made the injunction permanent.

Planned Parenthood said in its complaint that it operates 13 healthcare facilities in the state, five of which provide non-Medicaid-funded abortions, and that it receives about $350,000 annually from Medicaid. The plaintiffs alleged that Bill 2800 was unconstitutional in several respects, but moved for summary judgment solely on the Medicaid Act issue, which had been the basis of the preliminary injunction.

State’s Arguments

Judge Marsha Berzon, writing for the Ninth Circuit, said the judgment was properly granted, rejecting the state’s arguments that the plaintiffs lacked standing to enforce the Medicaid Act and that the legislature had broad powers to define who was a qualified medical provider under the federal act.

With regard to the standing issue, Berzon agreed with the Sixth and Seventh circuits that private citizens who provide or receive Medicaid services have federally protected rights that can be enforced in a civil action under 42 U.S.C. Sec. 1983. While most Sec. 1983 claims involve constitutional rights, a number of cases have recognized that rights conferred by federal statute are enforceable against state and local officials through the Reconstruction-era civil rights legislation.

As for the substance of the claim, the judge noted that the Seventh Circuit recently struck down a nearly identical Indiana law, and said the reasoning of that case was equally applicable to the Arizona enactment.

‘Qualified to Perform’

Berzon explained that while the text of the Medicaid Act does not define what makes a provider “qualified,” the congressional intent was clearly to define that term as meaning professionally competent, particularly since the law says the provider must be “qualified to perform the service or services required.”

The judge elaborated:

“Arizona urges us to read § 1396a(a)(23) as having the opposite meaning from the one we ascribe to it: Rather than guaranteeing patient choice, Arizona contends in its briefs, the provision empowers states to restrict patient choice to a limited list of providers ‘for any reason supplied by State law.’ Arizona’s argument hinges on construing the statutory term ‘qualified’ not according to its ordinary meaning, but instead as a Medicaid-specific term of art conferring upon the states plenary authority to withhold Medicaid funds on any policy grounds they prefer to pursue.”

The argument is flawed, Berzon said, because it is contrary to the plain meaning of the language, fails to give effect to every word of the statute, and would produce absurd results, such as allowing states to require doctors who receive Medicaid funds to perform abortions, or limiting Medicaid reimbursements to doctors who attended a particular medical school, or to smokers, or to non-smokers.

The judge acknowledged that the Medicaid Act allows the secretary of Health and Human Services to waive the free-choice-or-provider rules for specific reasons, such as “to promote cost-effectiveness and efficiency.” But she rejected the state’s argument that a provision allowing states to “exclude any individual or entity for purposes of participating under the State plan . . . for any reason for which the Secretary could exclude the individual or entity” means that the state has plenary authority to exclude any class of providers it chooses.

The state, she said, “reads the provision for more than it’s worth,” because the authority to exclude a class of providers must still come from Congress. She agreed with the Seventh Circuit that the provision means that a state may disqualify providers who have engaged in “various forms of malfeasance” stated in the federal act, “such as fraud, drug crimes, and failure to disclose necessary information to regulators.”

The case is Planned Parenthood Arizona Incorporated v. Betlach, 12-17558.


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