Lost in the commentary about Mitch Daniels declining a run for President is that he seemed to signal the opposite a month before by signing a bill that will basically dissolve Planned Parenthood in the state of Indiana. Because the bill denying funding for Planned Parenthood – or technically speaking, for “any entity that performs abortions or maintains or operates a facility where abortions are performed,” which singles out Planned Parenthood without officially singling them out – affects Medicaid patients and involves both state and federal money, the federal government needs to sign off on it. And the Obama Administration won’t comply.

The Obama administration is raising serious objections to a new Indiana law that cuts off state and federal money for Planned Parenthood clinics providing health care to low-income women on Medicaid [...]

The changes in Indiana are subject to federal review and approval, and administration officials have made it clear they will not approve the changes in the form adopted by the state.

Federal officials have 90 days to act but may feel pressure to act sooner because Indiana is already enforcing its law, which took effect on May 10, and because legislators in other states are working on similar measures.

If a state Medicaid program is not in compliance with federal law and regulations, federal officials can take corrective action, including “the total or partial withholding” of federal Medicaid money. The mere threat of such a penalty is often enough to get states to comply. Actually imposing the penalty would, in many cases, hurt the very people whom Medicaid is intended to help.

This is a hostage situation as much as other Republican gambits. The penalty for non-compliance is a cancellation of Medicaid funds. That doesn’t hurt Mitch Daniels so much as it hurts poor people in Indiana. But if you impose no penalty, you’ve let Indiana restrict health care choices for Medicaid recipients, and allowed them to target an organization that also happens to perform abortions. And you’ve given other states the tacit approval to do the same thing.

The Centers for Medicare and Medicaid Services were pretty clear in their statement: “Medicaid does not allow states to stop beneficiaries from getting care they need — like cancer screenings and preventive care — because their provider offers certain other services. We are reviewing this particular situation and situations in other states.”

Planned Parenthood also filed a lawsuit in Indiana, but they did not secure a temporary injunction of the law while the case moved through the courts. So the ban on funding is currently in effect. The next hearing comes in two weeks.

The government has to act on this measure clearly prohibited by federal law, and the Obama Administration shows every indication that they will follow through. Incidentally, the federal government pays 90 percent of the share of funding for family planning in Medicaid. So the idea that this is a state’s rights issue is dubious.