U.S. warns state’s end of contract legally iffy

The federal government is warning state officials that Arkansas may have violated federal law by ending a contract with Planned Parenthood.

In an Aug. 17 email obtained through a Freedom of Information Act request, Jessica Schubel, a senior adviser to the director of the Center on Medicaid and Children’s Health Insurance Program Services, told Dawn Stehle, the Arkansas Medicaid director, and several others that states have an “obligation to ensure beneficiaries have freedom of choice of provider.”

Schubel’s email included a link to a federal advisory online that says in part that states may not “exclude providers from the program solely on the basis of the range of medical services they provide.” That includes abortion services, the advisory says.

On Aug. 14, the day Gov. Asa Hutchinson announced that Arkansas would stop funding Planned Parenthood, federal officials had called Tami Harlan, the state’s Medicaid chief operating officer, to express their concerns over the canceled contract, said state and federal officials.

Hutchinson has maintained that the state has the right to cancel a Medicaid contract with Planned Parenthood of the Heartland as long as the state provides 30-day notice.

“It is apparent that after the recent revelations on the actions of Planned Parenthood, that this organization does not represent the values of the people of our state and Arkansas is better served by terminating any and all existing contracts with them,” Hutchinson said in a written statement earlier this month.

In recent weeks, the conservative anti-abortion group Center for Medical Progress has released edited clips of conversations with Planned Parenthood executives, doctors and staff members in other states talking about how much money the organization would receive for providing various aborted body parts for medical research.

Hutchinson spokesman J.R. Davis said the Republican governor believes his action was legal.

“The governor is confident in his decision,” Davis said. “It clearly states in the contract between the state and Planned Parenthood of the Heartland that we may discontinue the agreement provided either side gives a notice of 30 days.”

The back-and-forth among state and federal officials on the issue comes as Ashley Wright, a policy analyst and lobbyist for Planned Parenthood of the Heartland, said the group is considering suing the state.

“A woman who’s on the Medicaid program — or a man — that’s coming in to see us will essentially have to change providers,” she said. “They may have been coming to us for years, and they trust our doctors. They trust our facilities.”

It’s illegal to force those patients to switch, Wright said.

The state Medicaid program paid Planned Parenthood $241,554 in fiscal 2010 for family planning services, $168,993 in 2011, $127,673 in 2012, $139,864 in 2013, $139,456 in 2014, and $51,429 in 2015.

Services include counseling, contraception, Pap tests, sexually transmitted disease testing and physical exams.

Medicaid has spent about $2.1 million on family planning in Arkansas this year, according to an analysis of data from the Department of Human Services.

Planned Parenthood of the Heartland — which runs two clinics in Arkansas as well as 17 others in Iowa, Nebraska and eastern Oklahoma — had a budget of about $25 million in 2012, according to forms filed with the Internal Revenue Service.

The organization said it saw about 4,000 patients in Arkansas in 2014. It’s not clear how many were on Medicaid, but one-third were at or below the poverty level, according to Planned Parenthood.

Hutchinson has said other organizations could pick up Planned Parenthood’s dropped Medicaid patients.

The state’s largest provider of services that Planned Parenthood offers Arkansans on Medicaid is the Arkansas Department of Health, according to the Department of Human Services.

Bradley Planey, chief of the Department of Health’s Family Health Branch, said his division saw about 55,000 Arkansans last year. The majority are poor and on Medicaid or the private option. About one-third have no health insurance.

That’s down from about 75,000 patients, probably because many of those clients now have those services covered under the private option insurance plan, he said.

“For the most part, when we’re talking about family planning or maternity or services that a hospital or a physician might do, we’re just doing those things in areas where there’s unmet need,” Planey said. “We’re a gap filler. We’re not out there to compete. And if we feel that there are sufficient resources in the area to address public health in certain categories, we don’t try to provide those ourselves.”

Two doctors and 38 nurse practitioners work under him. Family health services are available at 92 clinics around the state; some of those are open only a few days a month.

He noted that Arkansas has the highest teenage pregnancy rate in the nation.

“There’s a lot of areas where there’s not enough providers,” Planey said. “There’s not enough resources. Being a rural state, it offers a lot of challenges for people to always get the kind of attention they need.”

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