The U.S. Court of Appeals for the First Circuit has allowed the Trump administration to continue blocking Medicaid funding to Planned Parenthood, staying a preliminary injunction that had temporarily restored payments in 22 states and the District of Columbia. The ruling upholds enforcement of Section 71113 of the 2025 Budget Reconciliation Law, which bars federal Medicaid reimbursement for one year — effective July 4, 2025 through July 2026 — to abortion providers that received more than $800,000 in Medicaid funds in fiscal year 2023. The three-judge panel reversed a lower court order by Judge Talwani that had blocked the provision in December 2025, dealing a significant blow to reproductive health providers nationwide.

The impact on Oregon is acute. Planned Parenthood's two state affiliates — Planned Parenthood Columbia Willamette and Planned Parenthood Southwestern Oregon — operate 11 clinics from Portland to Ontario and Eugene to Medford. Together they served more than 75,000 Oregon Health Plan patients in 2024, with roughly 70% of all patient visits reimbursed through Medicaid. Planned Parenthood Columbia Willamette alone received over $15 million in state and federal Medicaid dollars in 2024, representing approximately 65% of total revenue. The federal funding ban has forced a projected 70% budget loss for Oregon's Planned Parenthood operations — a shortfall that state funding has only partially addressed.

Oregon has moved aggressively to backfill the gap. In November 2025, the legislature's Emergency Board allocated $7.5 million in emergency funding, and in March 2026 lawmakers passed HB 4127 adding another $8.9 million — bringing total state replacement funding to approximately $16.4 million. But even these combined allocations roughly match only one year of the lost federal share, and the state appropriations are temporary measures. Nationally, Planned Parenthood has warned that without Medicaid funding, it could be forced to close a portion of its roughly 600 facilities, affecting more than 1 million patients — about half its total patient base. Maine Family Planning has already shut down primary care operations due to the funding loss.

Watch for the Supreme Court, which may ultimately take up the constitutional challenge to Section 71113. Monitor whether the one-year funding ban — set to expire in July 2026 — is extended by Congress in subsequent legislation. Track the adequacy of Oregon's state replacement funding as clinics burn through the emergency allocation and HB 4127 dollars. The critical question for Oregon providers is whether the state can sustain $16+ million in annual backfill funding if the federal ban becomes permanent or is renewed beyond the initial one-year window.