Planned Parenthood to Face Trial in Texas’ $1.8 Billion Lawsuit
By Brendan Pierson and Nate Raymond
(Reuters) – A federal judge ruled on Monday that Planned Parenthood must face a trial in a $1.8 billion lawsuit filed by Texas. The lawsuit accuses the organization of defrauding Texas’ Medicaid health insurance program, which is led by Republicans.
The dispute revolves around billing practices by Planned Parenthood after Texas terminated the organization as a Medicaid provider for low-income individuals. Planned Parenthood, known for providing abortions and other healthcare services, along with Texas, sought a ruling in their favor from U.S. District Judge Matthew Kacsmaryk. However, Judge Kacsmaryk declined to make a summary judgement and instead scheduled a trial for next April.
In a sealed order briefly posted on the public court docket, Judge Kacsmaryk ruled against Planned Parenthood on a crucial legal issue. The judge determined that the organization was obligated to return certain funds to both Texas and Louisiana, although the exact amount and whether Planned Parenthood knowingly violated the law were not decided upon.
At this time, neither Planned Parenthood nor the office of Texas Attorney General Ken Paxton have commented on the ruling.
The lawsuit was initially brought forth in 2021 by an anonymous plaintiff under the federal False Claims Act, which allows individuals to file whistleblower lawsuits on behalf of the government and potentially receive a reward. Attorney General Paxton later joined the suit.
The allegations accuse Planned Parenthood of unlawfully continuing to bill the state Medicaid programs after Texas announced the termination, which faced years of legal challenges, from its insurance program for low-income individuals. While abortions cannot be reimbursed using state and federal funds, Planned Parenthood receives reimbursements from most states for other reproductive healthcare services.
Judge Kacsmaryk, a conservative jurist who previously worked as an anti-abortion activist, was appointed to the bench by former President Donald Trump. In April, the judge issued an order that effectively banned the abortion pill mifepristone. However, the order has been put on hold pending review by the U.S. Supreme Court.
The anonymous plaintiff in the lawsuit has claimed responsibility for releasing undercover videos in 2015 that purported to show Planned Parenthood staff discussing the sale of fetal tissue. Planned Parenthood has denied any wrongdoing, stating that the videos were heavily edited and misleading.
The release of those videos prompted both Texas and Louisiana to announce plans to terminate Planned Parenthood as a Medicaid provider in 2015. However, federal court orders prevented the terminations from being finalized for several years. The appeals later lifted the orders, allowing Texas to terminate its contract with Planned Parenthood in 2021 and Louisiana in 2022.
The lawsuit in front of Judge Kacsmaryk accuses Planned Parenthood of defrauding the states by continuing to bill and collect payments from their Medicaid programs even after the termination decisions were made. Texas joined the case, while Louisiana did not.
Planned Parenthood has expressed concerns that the total liability in this case, including legal penalties, could amount to $1.8 billion and potentially impact its operations in Texas.
The organization has argued that there was nothing illegal about billing the states during the pause caused by court orders. Furthermore, Planned Parenthood contends that it cannot be held responsible because the states never requested repayment. Judge Kacsmaryk, however, ruled on Monday that once the appeals courts allowed the terminations to proceed, Planned Parenthood became obligated to return the funds received during that period.
As a major abortion provider, Planned Parenthood has long been the target of abortion opponents who call for the defunding of the organization.
Judge Kacsmaryk is automatically assigned all federal cases filed in Amarillo, making it a favored venue for litigation brought by conservative activists.
In the wake of the Supreme Court’s 2022 decision to overturn the landmark 1973 Roe v. Wade ruling, Texas has effectively banned nearly all abortions.
(Reporting by Brendan Pierson in New York, Editing by Will Dunham, Alexia Garamfalvi and Leslie Adler)
