A federal lawsuit accusing Planned Parenthood of unlawfully billing Medicaid will continue after a judge rejected the abortion provider’s claim of immunity for the actions of its attorneys.
The state of Texas and an anonymous whistleblower are seeking more than $1.8 billion in penalties.
Background
In 2021, an anonymous whistleblower filed a federal lawsuit accusing the Planned Parenthood Federation of America (PPFA) and three Texas affiliates of defrauding the state’s Medicaid system. Attorney General Ken Paxton later joined the suit.
Specifically, the whistleblower alleged that after three Planned Parenthood affiliates were terminated from Medicaid, they masterminded an in-court and out-of-court scheme to maximize their ability to continue submitting Medicaid claims—in violation of the False Claims Act.
Planned Parenthood of Greater Texas, Planned Parenthood Gulf Coast, and Planned Parenthood South Texas, allegedly received roughly $10 million in Medicaid funding during the disputed period. The False Claims Act allows for triple the damages plus statutory penalties and inflation—escalating the total potential judgement to $1.8 billion.
PPFA called the lawsuit a “baseless” political attack.
“Planned Parenthood organizations are nonprofits that follow the law and provide essential, life-saving health care to their patients,” wrote the abortion provider.
U.S. District Judge Matthew Kacsmaryk in Amarillo denied PPFA’s motion for summary judgement, and rejected its claim that it was entitled to immunity for the actions of its attorneys.
PPFA had argued that it was immune from the suit’s claims because they rested solely on the alleged conduct of the national organization’s attorneys in advising local affiliates.
As expected, the federation appealed Judge Kacsmaryk’s decision to the U.S. Fifth Circuit Court of Appeals in New Orleans.
At the Fifth Circuit, a three-judge panel determined that it had jurisdiction to take up the appeal. The panel then reversed and remanded Judge Kacsmaryk’s decision, agreeing with PPFA that attorney immunity shielded the federation from liability.
The whistleblower was then successful in seeking an en banc rehearing at the Fifth Circuit, meaning it would be heard before all 18 active judges.
On August 12, the en banc court concluded that the Fifth Circuit actually lacked jurisdiction to consider the appeal, and that the panel should never have ruled on the matter. The appeal was therefore dismissed, leaving Judge Kacsmaryk’s denial of PPFA’s claim of attorney immunity intact.
The case has been remanded back to Kacsmaryk to proceed on the merits.
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