En Banc Fifth Circuit: Medicaid Patients Can’t Challenge State’s Determination that Provider Is Not Qualified

In an important decision yesterday (in Planned Parenthood v. Kauffman), the en banc Fifth Circuit ruled by a vote of 11 to 5 that Medicaid patients do not have a statutory right to challenge a state’s determination that a health-care provider is not “qualified” to provide Medicaid services.

The ruling is a big victory for the state of Texas in its effort to hold Planned Parenthood accountable for unethically altering its abortion procedures in order to provide fetal organs and tissue to researchers. Texas terminated its Medicaid provider agreements with five Planned Parenthood affiliates after the Center for Medical Progress released video recordings of Planned Parenthood officers negotiating to provide fetal body parts.

I’m still in the process of reading through the 100+ pages of opinions. For now, I’ll provide a high-level overview of the ruling and of the competing opinions.

1. Let’s start with Fifth Circuit chief judge Priscilla Owen’s majority opinion, joined in whole by Judges Jolly, Jones, Smith, Elrod, Southwick, Willett, Ho, Duncan, and Engelhardt and in large part by Judge Haynes. (Judge Oldham was recused, and Judge Wilson, who joined the court after the case was argued, also did not take part.)

Owen offers two independent grounds for her conclusion that 42 U.S.C. § 1396a(a)(23) does not give Medicaid patients a right to challenge a State’s determination that a health care provider is not “qualified” to provide Medicaid services. First, the Supreme Court’s 1980 decision in O’Bannon v. Town Court Nursing Center forecloses the existence of such a right. (Pp. 10-14.) Second, the text of the provision does not “unambiguously” grant such a right. (Pp. 14-23.)

Owen acknowledges that there is a split among the federal appellate courts on this question, with the Fifth Circuit joining the Eighth Circuit on one side of the split, and with five circuits on the other side. She addresses the flaws she sees in the opposing rulings. (Pp. 23-30.)

2. In a concurring opinion, Judge Jennifer Walker Elrod, joined by six of her colleagues (Jones, Smith, Willett, Ho, Duncan, and Engelhardt) elaborates how two of the Supreme Court’s Spending Clause opinions also foreclose a private right of Medicaid patients to contest a state’s determination that a provider is not qualified. (Pp. 35-46.) She also offers an additional reason for vacating the district court’s injunction: even if such a right existed, the plaintiffs’ claim would fail on the merits. (Pp. 46-58.)

3. Judge Stephen Higginson wrote an opinion concurring in part and dissenting in part, which was joined by Judges Stewart and Costa and partially joined by Judges Dennis and Graves. Higginson disagrees with the majority on the central question of the Medicaid patients’ right to sue, but he would hold that they may not challenge the state’s termination of a provider on grounds of professional competency (including ethics). (Dennis and Graves reject this latter part.) He draws a line, however, between the one Planned Parenthood affiliate that was directly involved in the conduct challenged as unethical and the other affiliates. (Pp. 65-80.)

4. Judge Dennis, joined by Judge Graves, dissents in full. (Pp. 81-105.) (Owen (pp. 33-34), Elrod (pp. 58-60) and Judge Ho, in a brief separate concurrence (joined by Judge Duncan, pp. 61-64), all take issue with Dennis’s strange claim that stare decisis considerations somehow counsel against the en banc court’s reversal of a panel holding.)