The state has picked up a new, powerful foe in its bid to deny any public funds to Planned Parenthood for family planning services: the United States government.
In court filings here, the Department of Justice is telling U.S. District Court Judge Neil Wake that a law approved earlier this year aimed specifically at cutting off all government funds to Planned Parenthood -- even for non-abortion services -- runs afoul of federal laws. Assistant Attorney General Joseph Mead, who is leading the federal government's charge, said those laws specifically allow Medicaid recipients who would be affected to choose to get care from any qualified provider.
And Mead said the state statute would essentially render half a dozen Medicaid regulations "meaningless.''
The law signed by Gov. Jan Brewer establishes an order for dividing up public funds for family planning. That specifically includes the Arizona Health Care Cost Containment System, the state's Medicaid program, which is funded two-thirds with federal money and a third with state tax dollars.
Under that law, top funding priority goes to government-run health-care facilities, followed by hospitals, rural health clinics and private doctors.
But the real teeth in the measure is that it bars funding for anyone who performs abortions or operates a facility where abortions are performed. Rep. Justin Olson, R-Mesa, sponsor of the legislation, acknowledged it is aimed specifically at Planned Parenthood.
Arizona law already forbids the use of public money for abortions. Olson said, though, to the extent Planned Parenthood gets tax dollars for other services, that frees up other funds to perform abortions.
That's also Brewer's contention. In signing the measure, she said it "closes loopholes in order to ensure that taxpayer dollars are not used to fund abortions, whether directly or indirectly.''
Planned Parenthood sued to have the law overturned.
The state agreed not to begin enforcing the measure as scheduled in August while the case makes its way through the court. Wake has scheduled a hearing Friday to hear arguments.
Since that time, though, the Department of Justice has decided to intercede.
In fighting the federal government, state Solicitor General David Cole said federal laws have always allowed states to establish "meaningful provider qualifications.'' And he argued that banning funds for Planned Parenthood -- even for non-abortion services -- fits within that power.
Mead derided that as making no sense. He said under Arizona's views, the state could enact any rules to block patients from going to the doctor or health provider of their choice no matter how unrelated the rule is to the ability to perform the services required.
"This interpretation would deprive the free choice of providers provision (of federal law) of all meaning, as states could restrict free choice by simply describing the restriction as a 'qualification,' '' he wrote.
Cole said that ignores the sovereign power of the state to set "reasonable provider qualifications.'' He said that includes refusing to fund providers for various reasons, including those involved in fraud or who have conflicts of interest.
"This badly misunderstands the nature of the dispute here,'' Mead countered.
He said it would be one thing if Arizona were imposing limits on programs entirely funded by the state. But Mead said once Arizona decided to accept federal Medicaid dollars, it "must comply with the mandatory requirements of Medicaid -- including the free choice of providers provision.''
Cole, however, said the law Mead is relying on really isn't that black and white.
"States accepting funds from the federal government must be aware of the conditions attached to the receipt of those funds so that they can be said to have voluntarily and knowingly accepted the terms of the contract,'' he wrote.
And Cole said Planned Parenthood does have an option to keep getting family planning funds: Create a separate legal entity to provide elective abortions. So far, though, the organization has refused to pursue that course, with Bryan Howard, the organization's president, saying that makes no sense from a financial or even health perspective.
"All women's health care should be available under one roof,'' he said, to provide continuity of care. Howard also said splitting into two organizations means additional costs for licensing and regulation.
Technically, AHCCCS does not directly fund Planned Parenthood for things like breast exams, Pap smears and treatment for sexually transmitted diseases. But the state pays money to health-care organizations, which then contract with providers like Planned Parenthood.
But AHCCCS, in interpreting Olson's legislation, adopted rules barring even this indirect funding.