Defunding Planned Parenthood is the Wrong Solution to a Real Problem

The Setup

Last week was my birthday week, so needless to say I wasn’t following the news as much as I usually do. Typically I rely on C-SPAN live streams to watch hearings at the Capitol, presidential candidate debates and interviews, and the like. I try my best to witness the whole context and understand the background facts as much as my time allows. But I was unable to do this for one especially controversial, extremely politicized topic until today – defunding Planned Parenthood.

Instead, I clicked the headline of a post shared by a friend on social media and read it to get a feel for Cecile Richards’ testimony before the House Oversight and Government Reform Committee. After watching all 4.5+ hours I can understand now why there was such a negative reaction to this particular post.  One friend called it “garbage”. I have to say I agree for multiple reasons including the fact that it is clearly very politically biased and ignores faulty logic used to back supposed facts. I’ll share it again here for completeness.

But I think both sides need to acknowledge that there is more to this story. Yes – there is something wrong with federal money going to Planned Parenthood (PP) as it currently stands. Yes – Planned Parenthood should be eligible for Medicare funds. In other words, defunding Planned Parenthood is the wrong solution to a real problem.

Here’s the link to the C-SPAN video again. I recommend watching it if you have four and a half hours to kill.

The Narrative

No matter who is talking, they are telling you a story of one kind or another. As humans we string facts and biases together to create our own individual interpretation of reality in order to come to some understanding. This condition is on display especially in politics. Here is my own understanding of the narratives being sold by the Democrat and Republican committee members who questioned Ms. Richards.

Democrats: Planned Parenthood has broken no laws and is therefore a legitimate option for Medicare patients. Based on the way Medicare works, all federal dollars received are by definition not supporting the organization’s abortion services in any way. Americans should not be forced to receive services from one provider over another based on availability of legal abortion services at either provider.

Republicans: Planned Parenthood may have broken any of three laws and if the organization is found to be guilty of these allegations, then it should be ineligible to receive federal funds. These laws include:  (1) The Hyde Amendment – no federal dollars can support abortion services (2) Fetal Tissue Transplantation Research Law – states that (a) purchase of fetal tissue is unlawful and requires (b) informed consent of the donor and that (c) the procedure was not changed solely to obtain fetal tissue (3) Partial-Birth Abortion Ban Act of 2003 – performing partial birth abortions is a criminal offense. In addition, Planned Parenthood may be applying it’s federal money labeled as discretionary funds towards expenses that do not support providing women’s health services like extravagant transportation, excessive salaries, and lobbying.

The chairman clearly explained from the beginning that the controversial videos that went viral weeks before should not be considered until all content had been made available for examination – a concept both sides of the aisle struggled to comprehend. Large portions of the meeting seemed a bit like a witch hunt on one side and a chance to throw political daggers towards Republicans and love letters to PP on the other. Members from both sides had trouble focusing on the main question – are federal funds appropriately used by Planned Parenthood?

I will not mention the conversation about the controversial videos here primarily because the point of this meeting with Ms. Richards was to examine Planned Parenthood’s finances. Similarly I will not discuss the value or quality of Planned Parenthood services because (i) such an evaluation has no bearing on the financial issues at hand (ii) it is very clear that Planned Parenthood is a leader in women’s health. It’s a waste of time and a distraction to prove that Planned Parenthood provides valuable services.

The Testimony

Ms. Richards was an exemplary witness. As president of Planned Parenthood, she was completely cooperative in providing records and any partner information requested by the committee. In addition, she responded professionally and gracefully despite poor treatment on the part of some committee members including being repeatedly interrupted, unfair interpretations of her responses, and needing to answer the same questions multiple times.  I know I would have gotten pretty frustrated if I were she, but she kept her cool for the majority of the testimony (she showed minor signs of frustrations toward the final hour). I believe she deserves some credit and respect for her performance.

With that said, I was previously unclear on the answers to many of the questions that caused the most confusion.

What federal money does Planned Parenthood receive?

The Congressional Budget Office (CBO) lays out the answer in a letter to the House Majority Leader Kevin McCarthy.

Based on information from a variety of government and private sources, CBO estimates that Planned Parenthood receives approximately $450 million annually in federal funds. Of that amount, roughly $390 million is provided through the Medicaid program and less than $1 million is provided through the Children’s Health Insurance Program and the Medicare program combined. The remaining amount, approximately $60 million, is provided through the National Family Planning Program, which operates under Title X of the Public Health Service Act (commonly referred to as Title X). Funding for that latter program is subject to appropriation.

Summary

• 86.7% Medicaid – primarily for cancer screenings and treatment of STDs
• 13.3% Title X funding – family planning services
• 0.2% Other – CHIP and Medicare

Does Planned Parenthood receive a lump sum of federal dollars to spend as it sees fit?

Ms. Richards must have explained how Medicaid funding works three or more times. First, Medicaid funding only applies to low income patients as noted by Del. Eleanor Holmes Norton. Second, Medicaid is a reimbursement plan for services provided. If no Medicaid patients went to Planned Parenthood for the allowable services, then Planned Parenthood would receive zero Medicaid dollars. The amount of federal dollars received is directly related to the expense of treating eligible patients. In other words, it is impossible by definition for Medicaid dollars received to be applied arbitrarily.

The questioning didn’t explain how Title X, CHIP, or applicable Medicare dollars are dispersed, but the implication was that the rules that apply to Medicaid also apply to the other federal dollars received. Therefore, the only way to get around the law is to dishonestly report exaggerated expense totals for the provided services in question – something that is under investigation in a handful of cases.

Does federal assistance allow Planned Parenthood to provision more funds toward abortion services?

This question was only partially answered. It is not clear to me that there is absolutely no overlap between legally federal funded services and abortion services. There was discussion of “overhead”, a term that refers to expenses like office space and salaries. It would make sense that the costs reported for federal reimbursement would include some percentage of overhead. It would then follow that these overhead dollars therefore also support abortion services that also rely on the same salaried professionals and the same offices for example.

However, neither claim was confirmed by Ms. Richards’ testimony. What was very clearly confirmed was that federal dollars received equals the cost incurred for providing eligible services – not abortions.

How can a non-profit organization have excess revenue, otherwise known as profit?

Profit is the value left after subtracting expenses from revenue. It is reasonable to expect that a non-profit organization never produces any profit. However, it is also reasonable to expect any business to try to expand. So how can a non-profit expand if its revenue always matches its expenses exactly? It would never have money left to invest in its future.

Ms. Richards’ answer is essentially that she fundraises specifically for expanding and puts reserves into the bank or commits them to future expansion projects. She never uses the term “profit” but instead refers to this money as “excess revenue”. Some might think there is no distinction to be made, but I expect she would argue that Planned Parenthood’s extra cash is already spent even if the project or resource hasn’t been confirmed yet.

How do mammogram referrals work?

As Rep. Brenda Lawrence noted and Ms. Richards confirmed multiple times, the process of getting a mammogram is always preceded by an exam by a health service provider who doesn’t perform the mammogram itself. In other words, the place that tells a woman that she might have breast cancer and needs a mammogram doesn’t have mammogram equipment. Rather, referring the woman to a specialist is standard practice.

Planned Parenthood has never been the second part of that process. They do cancer screenings that result in a mammogram referral. Do now and always have.

How available are women’s health services for Medicaid patients?

As Ms. Richards readily admits, Planned Parenthood health centers are vastly outnumbered by competing health centers. Nonetheless, a majority of women choose Planned Parenthood over any alternatives (where they exist) citing that 3 out of 5 women have used Planned Parenthood services. She points out that there are a number of motivations behind this statistic including personal preference, limited choices for Medicaid patients, and lack of alternate options regionally.

In the case of Medicaid patients, it was claimed that alternative health centers may have a cap on the number of Medicaid patients they will accept. Therefore, if Planned Parenthood were not funded, Medicaid patients seeking services like cancer screenings and STD treatments could be refused service by these alternative health centers.

Is Planned Parenthood using federal money to support its lobbying efforts?

Ms. Richards claims that any Planned Parenthood lobbying efforts are led by a spin-off company (whose name I have to dig up again…wish I had written it down) that is lead by a board of its own and not her. Any money transferred to this separate company from Planned Parenthood does not have tax payer origins. She also highlighted that providing women’s health services is a state-by-state activity that requires constant political engagement to maintain its current level of availability, citing activity in Texas multiple times.

My Conclusion

Based on this testimony, it seems unlikely that Planned Parenthood has done anything explicitly illegal. Since the videos of interest could not be considered, claims that Planned Parenthood broke the Fetal Tissue Transplantation Research Law or Partial-Birth Abortion Ban Act of 2003 were not sufficiently addressed to make a determination. However, I don’t think this conclusion means the status quo should be accepted as 100% kosher.

In cases of national security funding, the U.S. government takes every precaution possible. When a French telecom company bought an American telecom company and merged in 2007, the U.S. government refused to continue to work with the American groups because their money lead to foreign interests. Would French political leaders influence American engineers to leak U.S. intelligence? It is very unlikely, especially since France and America are allies. But was it possible? Yes, of course!

As a result, the intelligence groups within the previously American company had to spin-off and become an independent company with a special security agreement in order to continue vital projects for the U.S. government. I think a similar approach would address all concerns raised during this House committee meeting.

If federal dollars do not support abortion services at Planned Parenthood, then that part of the business is already independent and separated – perfectly poised to be legally a separate entity much like the lobbying portion of their business. If this step was taken, then Republicans would not be able to claim that overhead costs for services like cancer screenings were also supporting abortion services in conflict with the Hyde Amendment.

The opinion post I shared with my friends before watching Ms. Richards’ full testimony may have been “garbage”, but the opinion that health care providers that receive federal dollars should be separate from any hint of abortion services seems valid to me. Ms. Richard’s testimony only proved that federal dollars are not directly supporting such services when a higher standard is required in this context.