On Friday, a federal appeals court permitted the Trump administration to maintain its withholding of funding from Planned Parenthood, as stipulated in a tax and domestic policy bill signed by President Trump in July. This provision mandates the cessation of Medicaid reimbursements to certain large abortion providers, which Planned Parenthood contends was specifically designed to target its organization.

The court's decision reinstates the provision and remands the case back to a lower court for further examination. A three-judge panel, all appointed by President Joseph R. Biden Jr., unanimously overturned a previous ruling from July by a district court judge, who had indicated that the provision might unlawfully single out Planned Parenthood, potentially leading to severe consequences for the organization.

In the ruling, Judge Gustavo A. Gelpí articulated that lawmakers possess considerable authority to impose restrictions on federal spending. He stated that the modifications regarding Medicaid funding do not constitute illegal punishment. The law, according to Gelpí, "establishes new conditions on the receipt of appropriated funds in service of a new policy goal favored by Congress," allowing for compliance by ceasing abortion services.

Planned Parenthood initiated legal action against the Trump administration shortly after the bill's passage, asserting that the legislation was crafted to coerce the organization into discontinuing abortion services or risk losing substantial funding. The organization warned that the implementation of this provision could result in the closure of its health clinics and significantly undermine its financial stability.