Overview
The President signed H.R. 1, the One Big Beautiful Bill Act (the "Act"), into law on July 4, 2025. In Section 71113, the Act restricts the flow of Federal Medicaid funds to certain "Prohibited Entities" for the one-year period following its enactment.
Section 71113 puts forth a set of specific criteria. The prohibition applies to any entity—and its affiliates, subsidiaries, successors, and clinics—that:
- As of October 1, 2025
- Will be an "essential community provider," as defined by 45 C.F.R. § 156.235, that is primarily engaged in family planning services, reproductive health, and related care;
- Will be structured as a 501(c)(3) nonprofit organization and
- Will provide abortions (except cases involving rape or incest or if the woman's life is endangered); and
- Received more than $800,000 in Federal and State Medicaid payments in fiscal year 2023.
The structure of Section 71113 has created considerable uncertainty. The restriction went into effect on July 4, 2025, but requires both a forward-looking assessment of the services a provider will provide as of October 1, 2025, and a backward-looking assessment of how much a provider received in Medicaid payments in 2023. This ambiguity has led to two separate legal challenges in the weeks following the Act's enactment. As of July 28, 2025, the U.S. Department of Health and Human Services ("HHS"), HHS Secretary Kennedy, the Centers for Medicare and Medicaid Services ("CMS"), and CMS Administrator Oz are enjoined from enforcing, retroactively enforcing, or otherwise applying the provisions of Section 71113 against all Planned Parenthood health care providers pursuant to a preliminary injunction issued by the U.S. District Court for the District of Massachusetts.1 On July 29, 2025, twenty-one state attorneys general and the Governor of Pennsylvania also filed suit regarding the constitutionality of Section 71113 in the U.S. District Court for the District of Massachusetts.2
Planned Parenthood et al v. Kennedy et al3
On July 7, 2025, Planned Parenthood Federation of America (PPFA), Planned Parenthood League of Massachusetts (PPLM), and Planned Parenthood Association of Utah (PPAU) filed suit against HHS, HHS Secretary Kennedy, CMS, and CMS Administrator Oz on behalf of PPFA's Members in the U.S. District Court for the District of Massachusetts, arguing that Section 71113 is unconstitutional.4
In the complaint, the Plaintiffs alleged that Section 71113 was unconstitutional in that it: (1) violated their right to freedom of association; (2) subjected them to a bill of attainder; and (3) infringed on their Fifth Amendment and Due Process rights.
On July 21st, Judge Indira Talwani issued a preliminary injunction blocking the provision of the Act that sought to defund Planned Parenthood.5 In its order, the court emphasized that the law is likely unconstitutional and would immediately harm those on Medicaid.6 Shortly after, on July 28, 2025, Judge Talwani issued an expanded the preliminary injunction, making it applicable to PPAU, PPLM, and "all other members" of PPFA.7
Specifically, the July 28 Preliminary Injunction (a) enjoins HHS, HHS Secretary Kennedy, CMS, and CMS Administrator Oz from "enforcing, retroactively enforcing, or otherwise applying the provisions of Section 71113" against PPAU, PPLM, and "all other members" of PPFA and (b) directs them to "take all steps necessary to ensure that Medicaid funding continues to be disbursed in the customary manner and timeframes" to PPAU, PPLM, and "all other members" of PPFA.8 In refuting the Plaintiffs' allegations, the Government argued that "democratically...
