By Mary Wisniewski
CHICAGO (Reuters) - Indiana is appealing a judge's ruling that blocks the state from enforcing a law which eliminates government funding to Planned Parenthood because it performs abortions, the state's attorney general said on Tuesday.
The Indiana law, signed by Gov. Mitch Daniels last month, strips the women's health group of funding, including money from the federal Medicaid program for the poor.
A decision by U.S. District Court Judge Tanya Walton Pratt last week granted a preliminary injunction to block enforcement of the ban on Planned Parenthood offices in Indiana receiving reimbursement for Medicaid claims.
Planned Parenthood of Indiana said in a statement it was "not surprised" at the appeal. It said the law, if enforced, would cut funding to non-abortion services for Medicaid patients, such as contraception and cancer screening.
"We are confident we will prevail in our legal arguments and find it regrettable that the Indiana Attorney General has chosen to invest even more state resources in an appeal," said PPIN President and CEO Betty Cockrum.
Indiana is one of three states that cut funds for Planned Parenthood because it performs abortions. The others are Kansas and North Carolina, although those states cut only state funding and not federal Medicaid funds.
Abortion is already not covered by Medicaid funding, but proponents of cutting funds to Planned Parenthood say the money indirectly subsidizes abortion by paying salaries and other overhead.
The state had argued the law could allow Planned Parenthood to receive Medicaid payments even if it is affiliated with an abortion clinic, so long as the abortion clinic is a separate corporate entity and there is no risk that taxpayer revenues might indirectly subsidize abortions.
The state is already appealing the federal government's decision not to approve changes to Indiana's Medicaid plan, according to a statement from Indiana Attorney General Greg Zoeller.
"Both the legal challenge and the administrative appeal are headed to the same court -- the U.S. 7th Circuit -- which is where this dispute between the state and the federal government over what procedures we will allow our tax dollars to indirectly support should be heard," Zoeller said.
Planned Parenthood said the judge's ruling noted that public interest "tilts in favor" of granting the injunction because federal officials threatened partial or total withdrawal of all Medicaid dollars to the state, a loss of as much as $5 million if the law was enforced.
(Writing and reporting by Mary Wisniewski; Editing by Cynthia Johnston)