News Column

Will Texas Law Really Close Clinics?

July 10, 2013

Laylan Copelin

As the Legislature prepares to increase dramatically the standards for abortion clinics, the two sides disagree on whether clinics would shutter their doors and the number of abortions in Texas would plummet.

The debate over the economics of abortion is largely anecdotal, but this isn't the first time that Texas has changed its abortion standards. In 2003, as part of the Woman's Right to Know law, the Legislature mandated that pregnancies at or beyond 16 weeks of gestation must be ended at ambulatory surgical centers rather than at abortion clinics.

Theodore Joyce, a Baruch College professor in New York who studied the impact of the 2003 law, expects a short-term reduction -- 10 to 12 percent -- in abortions if the current bill becomes law.

"As women adjust and as the clinics adjust, the long-term impact won't be as great as the right-to-life folks think," he predicted. "The cost of dealing with a child is enormous."

He bases his opinion on what happened a decade ago.

In 2004, when the Woman's Right to Know law went into effect, Joyce said none of the abortion providers qualified as ambulatory surgical centers. He said the number of abortions performed in Texas at or after 16 weeks of gestation dropped by 88 percent over one year. Meanwhile, the number of Texans who left the state for a late abortion quadrupled.

Writing in the New England Journal of Medicine, Joyce said that by 2006 Austin, Dallas, Houston and San Antonio had ambulatory surgical centers to perform abortions. He noted that late abortion rates recovered, but remained below 2003 levels at the time of his study.

With this year's more sweeping legislation, Joyce said the impact on abortion rates depends on the ability of the six existing surgical centers to ramp up to either perform more abortions or refer patients to out-of-state facilities.

In 2011, the latest year for which statistics are available, there were 72,332 abortions performed in Texas -- about 10,000 below the peak in 2006. Seventy-seven percent of the 2011 abortions were performed in the state's 36 abortion clinics and 22 percent in ambulatory surgical centers.

Unlike the 2003 law, the pending legislation affects all abortions one way or another. It would prohibit most abortions after 20 weeks of gestation, require doctors performing abortions to have hospital privileges and mandate that abortion clinics be certified as ambulatory surgical centers.

It is that last requirement that some abortion clinic owners say threatens their survival, while proponents of the law insist that the industry will continue in Texas.

Amy Hagstrom Miller, who owns five abortion clinics in Texas, including one in Austin, said she expects to close her doors if the Legislature requires the clinics to become the equivalent of day surgery centers.

Planned Parenthood may be the largest abortion provider, but about three-fourths of the abortions in Texas are performed by independently owned operations such as Hagstrom Miller's Whole Woman's Health, according to interviews with abortion clinic owners.

While proponents of the tougher standards argue that the abortion industry can afford the new regulations because abortions are a "cash cow," Hagstrom Miller begs to differ. She said her five clinics had a profit margin of 3.3 percent last year and lost 6.3 percent in 2011.

"We don't have a magic revenue stream," said Hagstrom Miller, a self-described "social entrepreneur" who has been in the abortion field for 24 years and started her company 10 years ago.

She charges $400 for an abortion under 12 weeks of gestation. The charge rises to $2,000 at 24 weeks.

She said most insurance companies cover abortions except in instances when employers object. In Texas, Medicaid isn't an option for abortions, so many clients are cash customers.

A visit to Hagstrom Miller's North Austin abortion clinic underscores the difference between the two types of facilities.

It resembles a small doctor's office with three procedure rooms, each the size of a typical examination room. There are also spaces for an ultrasound room, a nurses station and a recovery area with several recliners.

There are about eight or so staffers on hand, including one or two nurses. Hagstrom Miller said her doctors, who are under contract, work part-time since they either have their own practice, are employed by a hospital or are semiretired.

By comparison, an ambulatory surgical center resembles a small hospital capable of keeping patients for up to 23 hours. It has wide halls for gurneys, special air filtering systems to control infections, a back-up generator, a pharmacy, fire walls and procedure rooms that are four times the size of those at Hagstrom Miller's abortion clinic.

A surgery center requires much more staff, including three or more nurses, depending on its size.

Hagstrom Miller said a surgery center is unnecessary for most abortions.

"Abortion is complex morally and ethically, but it's one of the simplest, safest medical procedures," she said.

She said about half of her clinic's patients take a pill at the clinic and more medicine at home. The abortion occurs at home. The other half select a medical procedure either with a local anesthetic or conscious sedation with an IV. There is no anesthesiologist involved.

Texas has more than 400 day surgery centers, but only six perform abortions. The others typically focus on procedures such as eye surgery, colonoscopies and such.

Hagstrom Miller runs one of the six surgery centers that perform abortions. She said she leased the San Antonio facility the past two years because she couldn't afford to build one at the going rate of $300 to $350 per square foot.

Planned Parenthood just completed a 19,000-square-foot facility in Fort Worth for $6.5 million.

Hagstrom Miller said a surgery center is also expensive to operate. She has testified that hers costs $40,000 more per month to operate than an abortion clinic.

"It has never made money," she said. Her clinics, she said, subsidized the surgery center.

Planned Parenthood is affiliated with 10 of the state's 36 abortion clinics, with Planned Parenthood of Greater Texas operating in Austin, Waco and the Dallas-Fort Worth area.

Danielle Wells, a spokeswoman, said 95 percent of Planned Parenthood's services are preventive health care, including cancer screenings, birth control and testing for sexually transmitted diseases.

"We provide abortions at only a handful of our health centers," Wells said. She said the Greater Texas chapter provides abortions at four of its 27 health centers.

"We'd have to make some very careful considerations about staying open," she said. "We'll certainly be considering all options."

Many abortion opponents point to the the wealth of the Planned Parenthood Federation of America -- its national office in 2011 reported $1.2 billion in net assets, more than $500,000 in salary for its chief executive and $87 million in excess revenue over expenses.

"When an industry is making an $87 million net profit, there is more than adequate resources to spend on (upgrading) those clinics," argued state Rep. Charles Perry, R-Lubbock, on Tuesday.

Officials with the national Planned Parenthood office didn't respond.

At times, proponents of the tougher abortion standards have sent mixed messages about their intentions.

While Gov. Rick Perry and Lt. Gov. David Dewhurst have talked of ending abortion in Texas, two doctors who are in the Senate are saying they believe the abortion industry will adjust to the new law.

State Sens. Robert Deuell, R-Greenville, and Donna Campbell, R-San Antonio, said abortion providers, including the nonprofit Planned Parenthood, just don't want to spend the money demanded by the higher standards.

"When you look at the millions of dollars that go through this industry, my opinion is that I can't help but think it's about protecting a cash cow," Campbell said.

Campbell said there is a price tag for higher standards: "Any ambulatory surgery center who wants to open has to invest a lot of money to meet all the standards."

Deuell said he believes the abortion clinics have the money to upgrade.

"I just don't think they'll close," he said.

He said he doesn't find it unusual that abortion clinic owners say they have thin profit margins.

Deuell, who owns clinics that don't provide abortion services, said clinics typically reinvest profits back into their business to avoid taxes. He said the money is spent as employee benefits or higher salaries for the owners or doctors.

"They are just folding it back into their salaries," Deuell said.

He said he based his opinion on conversations with former abortion providers.

He said current providers could put an end to the profit debate.

"If I thought the Legislature was going to put me out of business," Deuell said, "I'd open up my books."

Laylan Copelin writes for the Austin American-Statesman. E-mail: lcopelin@statesman.com.  




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