Twenty-nine states participate in the Medicaid’s Women Health Program, which extends Medicaid coverage for reproductive health services to lower-income women who do not qualify for the rest of the entitlement program’s benefits. In Texas, the program served about 130,000 women, with the federal government footing 90 percent of the bill. About half of the clinics participating in the program would have been disqualified by the new legislation.
“We very much regret the state’s decision to implement this rule, which will prevent women enrolled in the program from receiving services from the trusted health care providers they have chosen and relied on for their care,” Medicaid director Cindy Mann wrote in a Thursday letter to Texas officials.
While nine states have passed legislation to end abortion provider’s government funding, Texas is the first to lose federal dollars over it. Other states’ laws have only affected state spending, or have been held up by court challenges.
The issue boils down to what federal regulations allow states to do, and not do, in selecting providers for their Medicaid programs.
Texas passed a law last year that bars abortion providers from participating in the program, even if they are providing other services, like contraceptives and cervical cancer screenings. The federal government says that such a decision violates the state’s Medicaid contract.
In letters to other states that have tried similar moves, U.S. officials note that federal regulation does not allow states to bar a certain provider from Medicaid for providing a legal service.
“The law is very clear in Medicaid around free choice of provider,” Mann told reporters Thursday afternoon. “We strive to provide as much flexibility is possible...but on this case, federal law precludes us from doing so.”
The Obama administration has asked Texas to lay out a plan, by April 16, for how it will phase out the program. Gov. Rick Perry (R) has suggested that the state will pick up funding for the program, but where exactly those dollars come from still remains to be seen.