In a fiery exchange v Chuck Todd on last Sunday"s Meet the Press, Carly Fiorina stated repeatedly that American taxpayers room paying because that abortion. This might puzzle casual observers who are under the impression the for decades, the Hyde Amendment has somehow protected taxpayers who oppose abortions from having to pay because that them. For this reason what"s the truth?

This week"s i of a continuing resolution come avert a potential government shut-down over the problem of plan Parenthood resources now has actually shifted what might be a knock-down-drag-out hit over that issueuntil December 11.For reader wishing come get better informed in advancement of both that debate as well as candidate disputes in the mainly ahead, I assumed a brief primer was in order.

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As ideal I deserve to determine, taxpayers subsidize roughly 24% of all abortion costs in the U.S. V 6.6% borne by federal taxpayers and also the staying 17.4% picked up by state taxpayers.If we apply the 24% number to the total number of abortions, this is tantamount totaxpayers payment the full price of 250,000 abortions a year, with about 70,000 financed by commonwealth taxpayers and 180,000 sponsor by state taxpayers


These figures are really rough yet certainly are an ext accurate than subjective guesses top top either next of this fierce debate. Here"s exactly how I come at them.

Background

A first-trimester abortion expenses $397 vs. $854 for a second-trimester procedure, however the fraction of abortions financed using insurance (public or private) is almost identical (25% because that second-term matches 22.6% because that first-term). Abortions room financed in a range of ways. Follow to a Guttmacher Institute survey in 2011, 69% the abortions space paid for completely out that pocket.Another 15.6% report making use of Medicaid, while 7.3% provided a non-Medicaid resource of coverage (although this 2011 inspection did not indicate the type of coverage--employer-sponsored or non-group, etc.). 8.6%reported not learning whether lock used third party coverage.

Everyone knows the Medicaid is taxpayer-funded, so the foregoing would show up to answer mine question. However this is exactly where things get complicated. First, as we"ll see, medical allowance is no the only vehicle by i beg your pardon taxpayers end up subsidizing some part of abortion costs. It"s not easy figuring out what re-superstructure of abortions is payment by commonwealth taxpayers vs. State/local taxpayers for this reason I"ve excellent the ideal I deserve to with readily available data.


Many the the limitations explained below have changed over time, part as recently as 2013. For simplicity, I have actually tried to codify existing policy quite than explain all this various transforms (which interested readers deserve to track utilizing the web links provided).

Reality #1: straight Federal Payment is enabled for Abortions Under reasonably Rare Circumstances

The Hyde modification is a rider to the yearly Labor/Health and Human services (HHS)/Education appropriations bill which avoids Medicaid and also any various other programs under this departments from capital abortions, other than in limited cases.

Medicaid. The current version the the Hyde revised (adopted in 1997) allows federal Medicaid resources for abortion in instances of rape and incest, and also life endangerment, yet tightens the life exemption to allow payment only when the woman"s life is endangered by "physical disorder, physics injury, or physical illness, including a life-endangering physical condition caused by or developing from the pregnancy itself." keep in mind that the Hyde revised has clearly been extended to encompass Medicaid managed care plans, thus is binding also in instances whereby Medicaid has actually been "privatized."

Medicare. Again, because of the Hyde Amendment, abortions space not extended Medicare actions "except if the pregnant is the an outcome of an plot of rape or incest; or in the instance where a mrs suffers native a physical disorder, physics injury, or physics illness, including a life-endangering physical problem caused by or emerging from the pregnant itself, that would, together certified through a physician, location the mrs in peril of fatality unless one abortion is performed."

Affordable care Act. The ACA consists of several provisions affect abortion services.

Federal Employees and also Dependents. FEHBP funds similarly cannot be used to pay for insurance coverage that abortion, except in situations of life endangerment, rape or incest--a restriction renewed through each annual appropriations bill (details and history in this CRS report).

Military Personnel and Dependents. DOD funds additionally may no be provided to perform abortions other than in cases of life endangerment, rape or incest. This restriction applies both to care noted directly by military wellness facilities and staff and also care provided by civilians and paid for through TRICARE, the wellness care and also insurance program for military organization personnel, your spouses, and also their dependence children. Note that military framework are barred native performing abortions also if they room paid for the end of private funds, again excepting cases of rape or incest or to save the life of the mommy (details and background in this CRS report).

Indian health Services (IHS). The IHS comprises several hundred hospitals, wellness centers, clinics and health stations that provide medical treatment to 2.2 million American Indians and also Alaskan Natives. Because 1996, IHS resources has been topic to Hyde amendment restrictions permitting abortions specifically in cases of life endangerment, rape or incest. However, reportedly, "the vast majority of Indian Health organization facilities are unequipped to administer abortions under any type of circumstances," causing less 보다 2 IHS-funded abortions per year <1>.

Women in federal Prisons. The room of Justiceisprohibitedfrom paying because that abortions for females in federal prisons, except in situations of life endangerment or rape. Note that a mrs inmate who have the right to afford come pay because that an abortionis allowed toobtain one outside the prison using personal funds;if so, she must be noted an escort in ~ no price (such escort obviously being a federal employee paid with taxpayer funds). However, there likewise is a “conscience” provision enabling workers in commonwealth prisons to refuse to offer as one escort.

Net impact of commonwealth Abortion Restrictions. According to a survey by Guttmacher academy of self-reported reasons for abortions, only 1% the abortions are due to rape and also another 1/2% as result of incest; 12% are as result of mothers reporting "physical difficulties with myhealth" although probably only 2.8% represent"life-endangering" cases <2>. Therefore it"s same to say the the vast majority of abortions--more 보다 95%--would not accomplish the stringent Hyde amendment standards.

While candidate Obamapledgedto repeal the Hyde Amendment, he was never ever able to perform so and indeed, in a last-minute deal, ended up having to sign an executive Order prolonging Hyde Amendment constraints to the Affordable care Act as a problem of getting enough votes because that it to pass. Gallup poll numbers have ratherconsistently shownabout fifty percent the populace supports abortion being legal only under some circumstances, while much less than one 3rd support it gift legal under any type of circumstances and also only one 5th support it being illegal in all circumstances. Thus, the odds that the Hyde Amendment limitations being lifted anytime quickly appearquite remote.

As a an extremely rough approximation, it shows up that no morethan 1,000 abortions a year are straight funded byfederal taxpayers <3>--i.e., around 1 in 1,000 abortions.

Reality #2: Some says Taxpayers Unequivocally Pay for Abortions

Medicaid. The Hyde revised only applies to federal funding. One of the conditions of Medicaid resources is that says are forced to cover all abortions permitted by the Hyde revised exceptions, i m sorry all perform with the exception of southern Dakota (which enables state Medicaid funds to it is in used exclusively for abortions wherein the mother"s life is in danger). But the rules similarly permit says to money abortions not enabled under the Hyde Amendment for this reason long therefore states usage their very own funds fairly than federal corresponding funds to perform so.

State Employees. Only 21 claims restrict abortion coverage in wellness insurance plans for state employees; 2 claims (CO, KY) prohibit abortion coverage altogether, if the continuing to be states just allowcoverage for minimal exceptions (e.g., life endangerment, rape, incest).

Taxpayers in this variousstates may or may not be mindful that your states have actually either been forced and also elected to money Medicaid abortions or the their taxation dollars are provided to pay for abortions because that state employees; hypothetically, in the worst case, any state resides isfree to relocate to an additional state need to the idea the being forced to contribute to together abortions it is in a violation of conscience or spiritual beliefs.

together a an extremely rough approximation, it shows up that about 165,000 abortions a year are straight funded bystate government taxpayers <4>--roughly 1 in 6 abortions.

Reality #3: Taxpayers Indirectly fund Abortions with the TaxExclusion

Recall that approximately 16% that abortions space financed v third-party coverage other than medicaid (inclusive the the 8.6% who report not knowing whether they offered such coverage to finance your abortions). Of those with private health insurance, 7 in 8get their coverage with employer-provided wellness plans (I"ve exclude, those who gain private coverage on the ACA Exchanges because these are accounted for earlier). Yet everyone with employer-sponsored wellness insurance services from the taxes exclusion, meaning that what your employer payment in premiums is no taxed as compensation (whereas the equivalent dollar amounts paid in earnings or salary would certainly be). In countless cases, employee premium contributions likewise can be done on a pre-tax basis, boosting the quantity of this tax benefit event additional (this primer explains in detail).

Because workers prevent paying both payroll and also income taxes, the median federal tax benefit amounts to about 30 cents per dissension of coverage <5>; in claims with income taxes, there could be secondary savings of up to 13 cent per dissension (CA). Thus, for workers with high marginal tax rates, the savings could exceed 50 cents per dissension of premiums.

There"s mixed evidence regarding the extent of abortion coverage among employer-provided health and wellness plans.

A 2002 survey of insurers confirmed that 87% of employee plans listed abortion coverage. In contrast, a 2003 survey of employers proved 46% of covered workers had plans that had abortion coverage. Keep in mind that these figures are not necessarily inconsistent for 2 reasons: 1) employers might offer lot of plans and also employees might be picking the plans there is no abortion coverage; 2) if large employers were much less likely than small employers to sell such coverage, the portion of employees v coverage might easily be much lower than the portion of employers giving such plans. The exact same employer survey conducted in 2010 proved that 3 in 10 employers said they extended "elective" abortions, however the non-response price was much greater (71%) in the 2010 survey compared to the 2003 inspection (26%).

For all these reasons, that is tough to be an exact about what share of abortions are implicitly tax-subsidized. If 7 in 8 the abortions sponsor through personal insurance space financed through employer-based plan then as a unstable approximation, approximately 100,000 abortions are indirectly sponsor in this fashion. Assuming a 30% commonwealth subsidy per abortion, this means that federal taxpayers finance ~4% that abortion prices in this fashion, if state taxpayers choose up much less than 1% <6>.

Reality #4: Taxpayers Indirectly fund Abortions v the Non-profit TaxExemption

Guttmacher academy maintains a repetitively updated database that abortion service providers which it each year surveys to recognize the total number of abortions performed. Amongst 1,720 such suppliers in 2011, the Institutereports the 63% of all abortions were performed in "abortion clinics" (defined as clinics in which much more than fifty percent of patient visits are for abortions).

Another 31% are performed in "other clinics" i beg your pardon by inference have to be a reference to to plan Parenthood (which mendaciously <7> cases that just 3% the its solutions are because that abortion clients) due to the fact that their clinics evidently do not meet the definition of "abortion clinic." to plan Parenthood perform 327,653 abortions in 2013. Suspect no change in the variety of abortions from 2011 and also 2013 (1,058,500), the would represent 31% of all U.S. Abortions, i beg your pardon matches the number reported by Guttmacher Institute because that 2011.

Hospitals account for only 4% that abortions, when physician workplaces account for 1%.

I have actually been unable to situate abreakdown of these 1700+ providers by ownership status, but everyone knows that Planned Parenthood is a non-profit organization, as are the vast majority of hospitals. Given that such a large fraction of health treatment organizations space non-profits, that is easily feasible that one 4 minutes 1 to one fifty percent of abortion clinics likewise are structured together non-profits. However, to it is in conservative, I"ve suspect that only one 3rd of every abortions room performedby together providers, i.e., plan Parenthood and fifty percent of hospital-provided abortion procedures.

While there"s no means of understanding what the mark-up is on abortion services, plan Parenthood"s latest annual report reflects net income over costs of 8.6%, therefore I will certainly assume the equivalent profit rate is applicable because that abortions. A for-profit coporation, group in the services industry would challenge an typical tax rate of 26.1% (inclusive the income, sales and property taxes) <8>; the taxes exemption means that taxpayers room implicitly jae won 2.3% the every abortion performed by to plan Parenthood or other nonprofit hospitals.

But remember the donations to non-profits also obtain a taxes benefit. Top top average, taxpayers finance 14 cents of every dollar contributed to charity. In 2013, to plan Parenthood received $257.4 million in charity contributions, of which $34.9 million was kicked upstairs come the nationwide Office in the type of dues. The staying amount made up 21.1% of the more than $1 billion invested by affiliates on assorted activities. Assuming the same was true of abortions, this represents an additional 2.9% latent taxpayer subsidy because that a complete of 5.2%. Because that simplicity I will assume the this subsidy is same divided in between federal and also state/local taxpayers, although the is most likely that federal taxpayers choose up an ext than half this cost.

If one 3rd of all abortions room performed through non-profit organizations, these numbers imply that federal and state taxpayers eachfinance 0.9% that abortion expenses in this fashion.

Reality #5: Taxpayers Indirectly money Abortions ThroughTitle X

In 2013, planned Parenthood got a complete of $528.4 million in federal government health solutions grants and reimbursements. CBO approximates that around $450 million that this represents annual federal funds, including $390 million with Medicaid, $60 million with Title X and $1 million because that Medicare/CHIP services. Also if plan Parenthood has actually a agree rata re-superstructure of federally-funded medical allowance abortions permitted by the Hyde Amendment, this would certainly account for less than $100,000 in medical allowance spending, so the vast bulk of the organization"s medicaid funds are for non-abortion services. Location X services likewise cannot be provided for abortions per se (although movie critics note the these can be offered for counseling and also "if any type of pregnant mrs requests one abortion referral, the affiliate must provide such a referral;" hence such funds indirect assistance the abortion "industry").

What"s more important is that these federal profits represent 35% the the $1.4 exchange rate in revenues reported by planned Parenthood in FY2014. Part opposed to federal capital for plan Parenthood, such together Michigan Rep. Jim Sensenbrenner,argue that these funds room "fungible." for this reason every tax dollar listed to planned Parenthood frees up a dollar that can be spent on abortion services.

Pro-choice supporters argue that because Planned Parenthood bills and also is payment for particular services--pregnancy tests, Pap smears, abortions etc.--funds are not fungible at all. Location X funding, for example, have the right to be used to provide discounted contraceptives, yet not abortion. If funds for discounted contraceptives were eliminated, the price the contraceptives may be would have to go increase (Planned Parenthood would certainly not longer have actually taxpayer funds with which to sell the previous subsidy), however the price the abortion solutions would continue to be unchanged.

The reality is more facility than one of two people of these accounts. First, indigenous a revenue perspective, funds quite frequently are fungible. Because that example, to the degree that federal dollars sheathe 100% of the prices of really worthy services available by plan Parenthood (e.g., cancer screenings, pregnancy trial and error etc.), this in rule frees up donated dollars (so long as no strings room attached) come be offered to aid finance abortion services. Donors might be enticed to donate based on marketing the highlights its an extremely worthy services not realizing the their donations are offered for abortions.

One deserve to argue the donors need to be better informed, however there appears to bea entirety cottage sector (led by to plan Parenthood itself) the seems established to minimization its role in offering abortions. Think about the agency"s own Planned Parenthood at a Glance page whose only cite of abortion consists of "Three percent of all Planned Parenthood wellness services are abortion services." but as described in footnote <6> below (and countless others have pointed out), this is thoroughly misleading given that at minimum 22% of planned Parenthood profits come native abortions. Even Washington Post"s fact Checker has awarded three Pinocchios because that this decidedly deceptive statistic. However that hasn"t inhibited an LA times "reporter" from continuing to promotethe 3% myth.

All organizations, planned Parenthood included, challenge fixed and also marginal costs. Airlines that control to cover their fixed expenses by selling high expense tickets to an initial class passengers room then able tooffer greatly discounted fares to your last passengers just to to fill seats--i.e., a price that covers the marginal expense of the fuel necessary to lug 1 more passenger. In a similar fashion, if plan Parenthood is may be to usage its federal funds to cover the vast bulk of its fixed costs, the then deserve to offer abortions at your marginal cost, definition that every abortion available is implicitly subsidized to part extent.

In a usual physician practice,practice expenses (i.e., whatever except doctor compensation inclusive the fringe benefits) constitute 51.7% the every dollar payment by Medicare to doctors (Table 1). Several of these expenses may be straight allocable to particular procedures, (e.g., wages and salariesfor non-physician professional and also technical personnel which median 6% of Medicare medical professional payments). But many costs cannot, such as managerial wages, clerical wages, and non-personneloffice expenses, skilled liability insurance--the last two alone constituting almost 25% the every dollar payment to doctors under Medicare.

In short, any type of Planned Parenthood clinic that established a method to cover every its overhead costs using various other resources hypothetically might afford to discount that abortion solutions by as lot as 50%. No clinic could honestly do this. There is, after ~ all, a an extensive OMB circular the lays the end the rules non-profit organizations are expected to follow. Organizations typically are permitted to use a streamlined allocation method, whichis come allocate indirect costs in proportion to straight costs. Thus, if 1 abortion prices 30 times as much as a 1 pregnant test, as one example, then a clinic doing just as many abortions as pregnancy tests would finish up allocating 30 time as lot of that is overhead prices to the abortion component of its organization than that pregnancy experimentation component.

But organizations likewise are permitted to usage an alternative base if they feel it is justified. Take into consideration this planned Parenthood firm in Michigan, which according to this audit report "has fifteen clinics and allocates the clinical expenses based on the number of visits for each program" (p. 5). This means that an abortion "visit" gets treated the very same as a pregnancy trial and error visit, therefore the abortion regimen at every clinic is walking to obtain much less overhead price allocated to it 보다 were the simplified allocation method used. What that way is that as soon as it receipt Medicaid or title X, because that example,for pregnancy testing services, those programs will certainly pick up much more overhead expenses than are really justified. That means that every dollar of Medicaid and also Title X funding that at an initial glance is paying because that pregnancy experimentation in reality is implicitly cross-subsidize abortion solutions to the degree that it covers some of the overhead expenses that a much more accurate overhead allocation ascendancy would have actually assigned to each abortion procedure.

Here"s what"s specifically interesting. When tested by the auditor to define why it had not allocated an ext overhead prices to family members Planning, the firm conceded the "using the prices for a provided department together the basis for allocating administrative costs would an outcome in additional cost gift charged come the household Planning Program." for this reason why didn"t it execute so? "Given the continuous political dispute that surrounding our mission and also work, the is both logical and also reasonable tochoose a cost allocation technique that outcomes in the most conservative declare of allowable costs" (p. 10).

Keep in mind that if abortions constitute 22% of to plan Parenthood revenues (and thus should be allocated 22% the its overhead costs, it really doesn"t call for all that much finagling that the overhead allocations because that the various other services the Planned Parenthood provides to chip away a large fraction of the overhead prices that otherwise would be allocated come abortions. The is, if the overhead prices for the continuing to be 78% of plan Parenthood"s company were exaggeration by a mere 10%, that alone would reduce the re-publishing assigned come abortions by much more than one 3rd (i.e., 7.8%/22%). If clinic overhead prices amount come 40% of each dollar paid for clinical services, such a cross-subsidywould amount to 14% of each abortion procedure. Provided that planned Parenthood has 66 different affiliates operation 700 different clinics, it would certainly take an army of sharp-eyed and also persistent auditors to ferret out this modest level of financial shenanigans and also put a protect against to it.

We have seen from a)the over audit report; b) the endlessly repetitive deceptive cases that abortion represents only 3% of their organization ; and also c) the histrionic reaction to the planned Parenthood videos, one organization highly politically motivated to avoid having actually the publicobtain a clear expertise of either the nature or importance of abortions come its mission. So while I"m no in a position to proveexactly just how much that this latent cross-subsidy in reality goes on,I don"t think it"s unreasonable come assume the it is based on the proof at hand.

So if we assume an median cross-subsidy that 14%, then the federal federal government implicitly shares 35% the it, picking up a network of 1.5% of all abortion expenses (given the Planned Parenthood offers only 31% of abortions), if state government taxpayers absorb 0.3%.

Conclusions

If us tote up all these components, we discover that federaltaxpayers cover roughly 6.6% of abortion costs. It"s worth noting that this lot is much more than 200 time as large as the previously reported direct expenses of abortions that are financed utilizing federal medical allowance dollars. The suggest being that the covert subsidies are far more consequential for commonwealth taxpayers 보다 they room for state taxpayers. State taxpayers covering 17.4% the abortion costs, yet this quantity is only 12% larger than the directly-financed costs underwritten by state taxpayers with Medicaid.

Remember that most indirect taxpayer financing of abortions comes in the kind of implicitly subsidized discounts ~ above the price of abortions that may variety from 50 cents on the dissension (in the case of taxpayers with high marginal tax rates who use an employer-provided health arrangement to salary for your abortion) to only pennies ~ above the dollar. But the size of taxpayer subsidies have the right to be perhaps far better assessed by reasoning in regards to abortion-equivalents. If we apply the 24% figure to the total variety of abortions, it is as if taxpayers salary the full cost of 250,000 abortions a year, with around 70,000 financed by commonwealth taxpayers and also 180,000 sponsor by state taxpayers .

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For anyone who previously supposed that federally sponsor abortions were limited to the 331 publicly reported for Medicaid, the contrast between reality and the far more minimal view we"ve had of truth to day is most likely to it is in staggering. The Hyde Amendment has actually actually achieved a very an excellent deal in regards to limiting direct payment for abortions. But if we"re yes, really serious about the proposition that commonwealth taxpayers should not be responsible for any abortions except to conserve the life that the mommy or cases of rape or incest, it have to be evident that over there is plenty more work to it is in done.

READ CHRIS’ BOOK , The American Health economy Illustrated (AEI Press, 2012), obtainable at Amazon and also other major retailers. With generous support from the nationwide Research Initiative at the American enterprise Institute , an on-line version complete with can be downloaded Powerpoint slides and also companion spreadsheets has been made easily accessible through the Medical market Leadership Institute’s Open education Hub at the university of Minnesota.