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Trump Reversal of Medicaid Family Planning Guidance Doesn’t Change Federal Law

The Centers for Medicare and Medicaid Services (CMS) recently rescinded its guidance of April 2016 reaffirming Medicaid law’s “free choice of provider” provision, which allows beneficiaries to receive family planning services from all qualified providers of such services. CMS’ reversal raises concerns that the Trump Administration may let states restrict women who receive Medicaid from choosing certain health care providers like Planned Parenthood. But the Administration’s reversal doesn’t change Medicaid’s “free choice of provider” protections under federal law, which courts have clearly upheld, and allowing states to bar Planned Parenthood from their Medicaid programs would thus be contrary to the law.

Medicaid law lets beneficiaries receive health care from any provider participating in the state’s Medicaid program if they’re “qualified to perform the service.” While states can restrict beneficiaries’ choice of provider through managed care arrangements, they can’t do so for family planning providers, as Medicaid law makes clear.

Some states nevertheless have tried to bar family planning providers that perform abortions, such as Planned Parenthood, from their Medicaid programs. Courts have rejected these attempts, ruling that any state restrictions on which providers can participate in Medicaid must be based on the provider’s “capability of performing the needed medical services in a professionally competent, safe, legal, and ethical manner.”

States seeking to bar Planned Parenthood and other providers have defended their actions by claiming that providers who perform abortions aren’t “qualified” to participate in Medicaid. Federal law already prohibits states from using federal Medicaid funds to pay for abortions except when there’s a danger to the life of the mother, or in cases of rape or incest. So any state that tries to restrict women’s choice of provider is only restricting access to health care services for Medicaid beneficiaries, especially for those seeking preventive and family planning services.

In its latest guidance, CMS claims that the 2016 guidance “raises legal issues under the Administrative Procedure Act,” and that it “limited states’ flexibility” in setting reasonable Medicaid provider standards. But the earlier guidance simply reaffirmed existing Medicaid law and earlier court decisions on establishing Medicaid provider qualifications while acknowledging states’ traditional role in that process.

Medicaid finances 75 percent of all publicly funded family planning services and plays a vital role in ensuring access to these services for thousands of low-income women. While CMS’ latest actions are troubling, the law is clear: Medicaid beneficiaries are free to obtain health care from any willing family planning provider qualified to provide those services.