Lawsuit: Planned Parenthood Made Millions in Medicaid Fraud

State   |   Steven Ertelt   |   Nov 13, 2012   |   12:29PM   |   Houston, TX

A federal court in Texas will hear this week how the Planned Parenthood abortion business in Texas defrauded taxpayers.

On Thursday, Alliance Defending Freedom Senior Counsel Michael J. Norton will present oral arguments against motions to dismiss Johnson v. Planned Parenthood of Houston and Southeast Texas, a lawsuit that alleges “repeated false, fraudulent, and ineligible claims for Medicaid reimbursements” through the Texas Women’s Health Program.

Norton will argue in U.S. District Court for the Southern District of Texas in the case where he represents Abby Johnson, the former director and clinic manager at the Planned Parenthood in Bryan/College Station, Texas. Norton says the case accuses the abortion company of fraudulent billing for services and Johnson says Planned Parenthood instructed her and other clinic managers to do so.

“Americans deserve to know if their hard-earned tax money is being funneled to groups that are misusing it,” he said. “People may hold different views about abortion, but everyone can agree that Planned Parenthood should play by the same rules as everyone else. It certainly isn’t entitled to any public funds, especially if it is defrauding Medicaid and the American taxpayer.”

The Medicaid fraud amount totals several million dollars for tens of thousands of false claims.

“The Houston management team announced to all those who were present that it had been falsely billing the Texas Women’s Health Program for services that are not reimbursable,” Norton details about a Planned Parenthood management meeting in Houston.

But when Johnson asked about what Planned Parenthood intended to do with the money, the response — according to the attorney — was: “We are going to hope we don’t get caught.”

Norton plans to present evidence to the court.

“The actual amount of damages at this point in time is estimated to be $5.5 million for about 90,000 false claims,” the attorney reports.



Another lawsuit , brought by the ACLJ for a former employee, alleges Planned Parenthood defrauded the government by charging state and federal governments for services not actually provided, medically unnecessary services, and services that are not covered under Medicaid and other programs.

In August, a federal court declined to dismiss that lawsuit, according to ACLJ attorney Matthew Clark.

“On Friday, a federal court agreed with the ACLJ that these allegations, if proven, constitute fraud in violation of federal law,” he said. “The federal court in Texas denied Planned Parenthood’s attempt to have this critical case against the abortion giant thrown out.”

“This is a major victory as this case to hold Planned Parenthood accountable moves forward to trial. At stake are literally hundreds of millions of dollars, and it is a case that could have a substantial impact on one of Planned Parenthood’s largest affiliates in Texas,” Clark said.

The federal court noted that the ACLJ lawsuit on behalf of former Planned Parenthood employee turned whistleblower, Karen Reynolds, “asserts that these false claims were submitted to the United States and Texas governments for reimbursement and, to support its claims for payment, [Planned Parenthood] regularly falsified patient charts.”

As the court also noted, Planned Parenthood merely argues that “there is nothing fraudulent about a policy to maximize revenues.” The Court didn’t buy that argument and held that if our client’s allegations are proven, it would show that Planned Parenthood engaged in a “fraudulent scheme to maximize revenues” in violation of federal law “on a regular if not daily basis” over the course of at least ten years.

Clark continued:  “This court decision is also a major victory in light of a recent decision from a California federal court throwing out a similar case against Planned Parenthood there. The ACLJ has already successfully appeal that case to the Ninth Circuit Court of Appeals once, and is preparing to appeal the trial court’s second attempt to throw the case out on a technicality.”

“The federal district court in California held that fraudulent overbilling of the government does not constitute a “false” claim. We are arguing on appeal, and as the federal court in Texas agreed, Planned Parenthood’s alleged fraudulent actions do violate federal law,” he concluded. “Both of these cases against the largest abortion provider in America are critically important in the fight for life and against continued taxpayer funding for the abortion business.”

Earlier this year, in Iowa, former Planned Parenthood clinic director Sue Thayer filed the lawsuit against the abortion giant’s Iowa affiliate accusing it of submitting “repeated false, fraudulent, and/or ineligible claims for reimbursements” to Medicaid and failing to meet acceptable standards of medical practice.

ADF explains that the lawsuit points out how Planned Parenthood, to enhance revenues, implemented a “C-Mail” program that automatically mailed a year’s supply of birth control pills to women who had only been seen once at a Planned Parenthood clinic and usually by personnel who were not qualified health care professionals. After that, Planned Parenthood mailed thousands of unrequested birth control pills to those clients.

Planned Parenthood’s cost for a 28-day supply of birth control pills mailed to clients was $2.98, but the Medicaid reimbursement Planned Parenthood received for the pills was $26.32. In some cases, the Postal Service returned the birth control pills to Planned Parenthood. Instead of crediting Medicaid or destroying the returned pills, Planned Parenthood resold the same birth control pills and billed Medicaid twice for the same pills.

The suit also claims that Planned Parenthood coerced “voluntary donations” for services and then billed Medicaid for them. In effect, the lawsuit explains, Planned Parenthood both falsely billed Medicaid and took money from low-income women by getting them to pay for services Medicaid was intended to cover in full.