Planned Parenthood of WI uses loophole to keep federal Medicaid funds and commit abortions
Planned Parenthood of Wisconsin (PPWI) is making use of a loophole in order to keep federal Medicaid funding after the Big Beautiful Bill removed that money for "prohibited entities" for one year.
But exploiting this loophole is merely part of a pattern for Planned Parenthood. The nation's largest abortion corporation has a record of violating the rules it is supposed to follow in order to receive federal dollars. As Live Action News' "Reject Planned Parenthood" series previously pointed out, the corporation:
Has been accused of discrimination and Medicaid fraud, among other abuses.
Key Takeaways:
Planned Parenthood of Wisconsin has resumed abortions and is again receiving federal Medicaid dollars.
They did this by utilizing a technical loophole that allowed them to relinquish their status as an "Essential Community Provider."
This was offered as one of three options for "prohibited entities" blocked from funding by the so-called "Big, Beautiful Bill." Those options included ceasing abortions, relinquishing tax-exempt status, or relinquishing Essential Community Provider status.
The Details:
Health and Human Services Loopholes
On October 1, 2025, Planned Parenthood of Wisconsin (PPWI) announced that the affiliate was pausing abortions while they strategized how to navigate the defund measure.
Then, on October 29, 2025, PPWI announced the affiliate had resumed abortions and "relinquished Essential Community Provider designation with the Health and Human Services" a move PPWI claimed "does not meet the definition of a 'prohibited entity' under the federal law and therefore is not barred from receiving Medicaid funds."
A press released issued by PPWI read in part (emphases added):
Planned Parenthood of Wisconsin discontinued providing abortion services on October 1, 2025, in response to President Donald Trump and Congressional Republicans’ budget law attacking access to abortion and the full range of care that PPWI provides....
In its court filing on September 29, 2025, attorneys on behalf of Health and Human Services stated that family planning organizations could continue billing Medicaid by ceasing abortion, or by relinquishing their tax-exempt status,or relinquishing their Essential Community Provider status.
Consistent with the text of the law and the government’s interpretation, Planned Parenthood of Wisconsin relinquished Essential Community Provider designation with the Health and Human Services. Accordingly, Planned Parenthood of Wisconsin does not meet the definition of a “prohibited entity” under the federal law and therefore is not barred from receiving Medicaid funds.
The Wisconsin strategy may vary from how Planned Parenthood affiliates respond in other states, according to the Associated Press (AP), which spoke to Planned Parenthood of Wisconsin president and CEO Tanya Atkinson.
"In Arizona, for example, Planned Parenthood stopped accepting Medicaid but continued to provide abortions," the AP wrote.
What is an "Essential Community Provider" (ECP)?
"An essential community provider (ECP) is a provider that serves predominantly low-income, medically underserved individuals," claimed HealthCare.gov.
The text of the BBB was specific (emphases added):
"No Federal funds that are considered direct spending and provided to carry out a State plan under title XIX of the Social Security Act or a waiver of such a plan shall be used to make payments to a prohibited entity for items and services furnished during the 1-year period beginning on the date of the enactment of this Act, including any payments made directly to the prohibited entity or under a contract or other arrangement between a State and a covered organization.
(b) Definitions.—In this section: (1) Prohibited entity.—The term “prohibited entity” means an entity, including its affiliates, subsidiaries, successors, and clinics—(A) that, as of the first day of the first quarter beginning after the date of enactment of this Act—(i) is an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code; (ii) is an essential community provider described in section 156.235 of title 45, Code of Federal Regulations (as in effect on the date of enactment of this Act), that is primarily engaged in family planning services, reproductive health, and related medical care; and (iii) provides for abortions, other than [in certain instances] ...
The Backstory:
Federal Medicaid Defunding
The “Big, Beautiful Bill” was signed into law by President Trump On July 4, 2025, removing Medicaid dollars from prohibited entities that provided abortion (as of October 1, 2025) and received more than $800,000 in Medicaid expenditures (during a previous fiscal year).
In response, Planned Parenthood filed a lawsuit and a temporary restraining order (TRO) was issued by an Obama-appointed judge. Then, on September 11, 2025, a First Circuit Court of Appeals ruling allowed for the defunding bill to go into effect while Planned Parenthood's lawsuit proceeds.
"The federal Hyde Amendment has prohibited federal funds from being used to pay for most abortion care for nearly five decades, but the new provision, which expires in July 2026, expands that prohibition to cover all Medicaid-covered services at clinics that also provide non-covered abortions," wrote the Wisconsin Examiner.
In 1973, when the Roe v Wade decision legalized abortion across the United States, it took precedent [sic] over Wisconsin’s 1849 law. When Roe was overturned in 2022, confusion over what took precedent [sic] in Wisconsin led Attorney General Josh Kaul to file a lawsuit, arguing restrictions put in place when Roe was in effect overruled the 1849 ban.
Abortion services in Wisconsin paused for 15 months until a preliminary ruling by Dane County Circuit Court Judge Diane Schlipper in 2023 interpreted the 1849 law applied only to feticide — killing the fetus without the consent of the mother — but not abortion, giving Planned Parenthood enough “clarity” to begin providing abortion care again.
A July decision by the state's Supreme Court overturned the 1849 law protecting virtually all preborn children from abortion. That same month, President Trump signed the BBB, which took effect in September.
In Wisconsin, "State Medicaid coverage of abortion care is banned except in very limited circumstances," the Guttmacher Institute's interactive map (updated October 22, 2025) claimed.
Zoom In:
Financial reports from PPWI reveal that the affiliate was bleeding cash before the BBB took effect. The affiliate's (2023 990) shows deficits of $2.6M (2023) and $5.7M (2022) while PPWI was spending $21.6M (2023) and $18.6M (2022) on salaries, benefits, compensation those same years.
From Oct. 1, 2023—Sept. 30, 2024, PPWI committed 3,727 abortions, the AP reported. PPWI's 2022-23 annual report reveals the affiliate only committed 51 abortions that year, likely due to the previously mentioned abortion law clarification.
PPWI boasted that the affiliate provided "the full range of reproductive health care—including cancer screenings, STI testing and treatment, contraception, miscarriage management, and more." However, an analysis of services provided by PPWI reveals that:
Contraceptive services declined nearly 38% from2015 to 2022-23.
STD testing declined over 21% from 2019 to 2022-23.
HIV testing declined over 13% from 2016 to 2022-23.
Cervical cancer screenings declined 74% from 2017 to 2022-23.
Breast exams declined nearly 78% (77.63%) from 2015 to 2022-23.
Meanwhile, abortions rose nearly 29% from 2016 (3,889) to 2020-21 (5,002).
Mark Wiltz, Director of Government Affairs for Live Action, told Live Action News that PPWI's move is an "intentional workaround" that has the potential to make the defund effort moot:
“Planned Parenthood didn’t change their behavior — they changed their paperwork. By dropping their ‘Essential Community Provider’ status, they found a technical workaround to continue receiving Medicaid dollars while still performing abortions.
This guts the intent of the congressional defund and sets a dangerous precedent. If this loophole isn’t closed, the defund becomes meaningless."
Pro-Life Wisconsin State Director Dan Miller said PPWI was "never an essential community provider" and will now resume its "grisly" abortion business.
Our response to Planned Parenthood of Wisconsin's announcement that they are resuming abortions in Wisconsin after pausing on October 1st. youtube.com/shorts/7tsbFDe…
"Abortion is not healthcare. Ask any baby who has been at the business end of a Planned Parenthood forceps," Miller added.
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