Ever since the summer of 2015 Congress has engaged in sustained debate over federal funds distributed to clinics affiliated with the Planned Parenthood Federation of America. In January of this year, Congress passed and sent to President Obama a budget reconciliation bill that would have had the effect of eliminating Medicaid reimbursements to Planned Parenthood that range into the hundreds of millions of dollars. These funds are part of annual government payments to the organization from a variety of programs (see the fact sheet here) that totaled nearly half a billion dollars each year from 2010-2012, and $553.7 million according to Planned Parenthood’s 2014-2015 annual report.
President Obama vetoed the reconciliation measure on January 8, which also would have affected major parts of the Affordable Care Act, and Congress failed to override the veto on February 2, 2016, voting 241-186 in favor of the override, well short of the two-thirds vote necessary to overcome the President’s objection.
What impact would permanent elimination of Planned Parenthood’s funding have on the federal budget, particularly the Medicaid program, which represents the bulk of federal dollars reaching the organization? On September 22, 2015 the Congressional Budget Office (CBO) transmitted a letter to House Majority Leader Kevin McCarthy advising him that a permanent cut-off of Planned Parenthood would result in an increase in federal spending of $130 million over 10 years. This spending would result from an increase in births to women under the Medicaid program which would, CBO argued, not have occurred in the presence of continued funding.
On November 9, 2015, the Charlotte Lozier Institute, at CBO’s invitation, submitted a detailed letter to CBO describing six ways in which its analysis leads to misleading conclusions about the federal budget impact of the Planned Parenthood cutoff. In fact, among other points CLI argues that rechanneling funds from Planned Parenthood to primary care providers will lead to budget savings in Medicaid, that CBO underestimates Planned Parenthood’s private sector fundraising resilience, that CBO uses an incorrect (too high by 20%) figure for Planned Parenthood’s contraceptive client base, and that the 10-year budget window analysis artificially shows new costs for Medicaid enrollees but neglects the contributions human beings make to sustain government programs in the second decade of their lives and beyond.
The full text of the CLI letter to CBO is here in .pdf format: CLI Letter in Response to CBO Planned Parenthood Defunding Estimates
Chuck Donovan is President of the Charlotte Lozier Institute.