Select Congressional Panel Releases Report on Planned Parenthood and Fetal Tissue, Part One

By Randall K. O’Bannon, Ph.D. NRL Director of Education & Research

Editor’s note. Beginning today, we are running a three-part series that offers a thorough overview of what the special Select Investigative Panel of the Energy and Commerce Committee found in its Final Report released in early January about the involvement of Planned Parenthood in harvesting fetal tissue from aborted babies.

Deborah Nucatola, senior director for medical services for the Planned Parenthood Federation of America

Deborah Nucatola, senior director for medical services for the Planned Parenthood Federation of America

In the summer of 2015, the nation was transfixed when an undercover journalist released videos showing employees of Planned Parenthood, the nation’s largest abortion promoter and performer, callously haggling over fees for processing tissue harvested from aborted babies. The images–literal and what lingered in the viewer’s mind–were riveting and nauseous.

Many questions were raised, including whether the companies involved profited from harvesting fetal brains, hearts, livers, and the like, and whether abortion techniques were altered in order to obtain the best fetal tissue.

While Planned Parenthood convinced many of its friends in the media to ignore that story, telling reporters the videos were “heavily edited,” people who had seen the footage knew what they had seen and wanted answers.

Heeding the public’s call, Congress launched several investigations. One of those, the special Select Investigative Panel of the Energy and Commerce Committee, after months of testimony and research, officially released its Final Report at the turn of the year, made it accessible to the public the first week in January.

The panel uncovered a great deal of new information about fetal tissue research, the fetal tissue business, and the unsavory relationships which exist between abortions clinics, tissue brokers, and researchers at some of the nation’s top universities (see Parts Two and Three). One key new finding was that multiple affiliates of Planned Parenthood had lengthy and extensive relationships with fetal tissue brokers from which the panel says both financially benefitted.

The nature of the investigation and evidence

Though the undercover videos by the Center for Medical Progress (CMP) provided the impetus for Congress’s interest, the select committee only used them as a starting point to launch a much wider investigation into the complex web of relationships between abortion clinics, tissue brokers, and university researchers. The final product is therefore not just an analysis of the CMP videos but the result of research, interviews, forensic financial analysis, uncovered documents, and the public and private testimony of experts and involved individuals.

What quickly becomes clear is that this was not a few rogue abortionists toying with the unanticipated opportunity of selling tissue under the table for personal profit. These were key affiliate leaders considering what they thought might be a better offer from a new buyer for a practice that had been going on at several Planned Parenthood clinics and affiliates for a number of years.

Records of transactions uncovered by the committee show payments of at least $613,788 to nine Planned Parenthood clinics in California for fetal tissue provided by Stem Express, ABR (Advanced Bioscience Resources), and Novogenix from 2010 to 2015, when the CMP videos first surfaced. This was not all back-ended either. There were payments of $81,895 in 2010 and totals over $100,000 for each year 2011 through 2013 (“Final Report “of the Select Investigative Panel of the Energy & Commerce Committee, December 30, 2016, hereafter referred to as “SPR,” p. 330).

The dispute between pro-life Republicans on the panel, who authored the main report, and pro-abortion Democrats, many who have received support from Planned Parenthood’s political action committees in the past, is not specifically over the amounts that changed hands, but over whether these hefty sums represent profits on materials that cannot be legally sold, or simply the reimbursement of ordinary, allowable business expenses.

Going back a few years

Many people fail to realize that Planned Parenthood has dealt with this issue before. In 2000, a March 8 installment of ABC News’ 20/20 program uncovered a fetal tissue harvesting scheme that had been going on at Planned Parenthood’s Overland Park, Kansas clinic for at least as far back as 1997. Then, like now, Planned Parenthood was not officially paid for the tissue, but for rent and other expenses related to the retrieval, preparation, and shipping of the tissue to researchers who paid a broker, handsomely, for the organs.

This is relevant because it was shortly after this exposure that Planned Parenthood’s national office issued a written memorandum on April 4, 2001. It informed affiliates about federal laws governing the practice and advising them to take great care to follow applicable state laws as well.

Interestingly enough, Planned Parenthood redistributed that memorandum in January 2011 with a note from one of the key players, identified as “PP Witness #1.” [1]

PP Witness #1 resent the memorandum to “remind” affiliates, who likely had experienced some turnover in the intervening years, about the federal law and “assure continuing compliance with the statutes” (SPR, p. 263).

Planned Parenthood noted that applicable federal laws (PPFA cites 42 U.S.C. 274e, the National Organ Transplant Act, and 42 U.S.C. 289g-1, prohibitions regarding human fetal tissue from the NIH Revitalization Act of 1993) “forbid the payment or receipt of valuable consideration for fetal tissue. However, they permit ‘reasonable payments associated with the transportation, implantation, processing, preservation, quality control, or storage’ of fetal tissue.”

In light of that, the national office’s guidance memo informed affiliates wishing to participate in fetal tissue “donation” that there were two legal ways of doing this: 1) to donate the tissue outright, with no expectation of recovering any costs or reimbursement; or 2) to employ an independent auditor to conduct a “credible and good-faith analysis” of the actual costs the affiliate incurred in transporting, processing, preserving, implanting, storing the tissue and maintaining quality control, and, if the research involving the tissue was federally funded, the costs involved in removing the fetal tissue (SPR, p. 262)

However Planned Parenthood affiliates investigated by the Select Panel appear to have largely ignored their organization’s own guidance. The clinics and affiliates investigated by the Panel did not donate the tissue outright, but had arrangements where they were paid fees per specimen. Though these were supposedly not direct payments (“valuable consideration”) for the tissue, but reimbursement for expenses, these clinics did not employ independent auditors to track and validate the actual costs.

Damning Documents

To ascertain whether Planned Parenthood complied with the law or even its own guidance, the select panel sought financial records from Planned Parenthood and the tissue brokers multiple times. However no contemporaneous documents –records that were created during and available from that actual time frame –were available.

Planned Parenthood’s lawyers indicated to the panel that the clinics did not keep or could not find such records and said that they did not do the independent audits. Stem Express refused to submit banking or accounting records to the committee, but the panel got access to invoices and bank accounts from other sources. The panel found that the tissue broker had shredding sprees whenever they were asked to produce more documents (SPR, pp. 139-140)

Eventually, Planned Parenthood produced what were supposed to be “good faith” estimates for its 2015 transactions, allocating costs to the categories mentioned in the law (e.g., transporting, processing, preserving, storing tissue, etc.). But the panel questioned these after the fact allotments and wondered what, if anything, Planned Parenthood contributed to the process that could be an actual legitimate, legally justifiable cost. (SPR, pp. 172, 337-347).

For example, was it reasonable for Planned Parenthood to claim thousands of dollars in costs for “staff time” attending meetings, managing patient flow, interpreting consent forms, etc.? How did “general administrative and medical overhead“ qualify as a reimbursable expense?

Some of these seemed particularly hard to justify, given that Stem Express had people onsite performing many of the consent and procurement tasks themselves (SPR Exhibit 8.23 and SPR, p. 161).

With perhaps a bit more credulity, Stem Express claimed expenses for processing, preserving, and storing the tissue. However the panel still found the costs they allocated for these excessive, given industry standards and the inventory involved (SPR, 157-161)

Both Planned Parenthood and Stem Express said, given their submitted costs, they actually lost money on the transactions, although they failed to give a reasonable explanation as to why they continued the program for a number of years and promoted it to clinics as a profitable venture (SPR, pp. 1, 143, 304)

If we tossed out Planned Parenthood’s dubious “staff time” and “general administrative and medical overhead” expenses, and brought Stem Express’ cost estimates into line with industry practices, both Planned Parenthood and Stem Express would have made considerable profits from their non-profit fetal tissue donation program.

According to records obtained by the investigative panel, Planned Parenthood affiliates in California are known to have received payments from Stem Express and other tissue brokers totaling $613,788 from 2010-2015. No audit for those figures was made available, but four affiliates provided schedules listing costs (including the “staff time” and “general administrative “ costs) that they said resulted in net losses for 2015 (SPR, pp. 330-332, Exhibit 8.23).

The panel found Stem Express’ own cost estimates suspicious. The company reported hours of management labor costs inconsistent with the number of samples they described, hours already counted twice, and failed to split costs such as mileage with maternal blood products obtained and transported at the same time. When corrected, for example, the 1/12/13 sale of a single fetal tissue sample to Baylor for $460 would have generated a profit of at least $108.50 (more if costs were split for maternal blood delivered at the same time) rather than a loss of $35 (SPR, pp. 158159)

Again, sad stories of economic losses were also inconsistent with Stem Express publications touting profits and the continued participation of Planned Parenthood in and their interest in expansion of these programs.

All of this offers hard evidence to flesh out what the CMP videos made clear, no matter what exculpatory hedging was supposed to have taken place on the editing room floor. Stem Express was an aggressive, lucrative for-profit enterprise. Planned Parenthood clinics were on the lookout for income opportunities from the “donation” of fetal tissue from aborted babies.

Altering Methods

The panel also obtained additional information on the willingness of Planned Parenthood abortionists to alter their methods in order to obtain the best fetal tissue.

Many remember the statements of Planned Parenthood abortionist and the organization’s senior director of clinical services Deborah Nucatola. In response to questions, she said she would “crush below…crush above,” changing the presentation from vertex to breech, to allow more gradual dilation, to see if she could get intact parts, to “deliver an intact cavarium” (head). Those who have read NRL News Today recall Mary Gatter, the president of PP’s Medical Director’s Council saying she wanted doctors open to using “a less crunchy technique for more whole specimens.”

In subsequent interviews with panel staff, PP Witness #1 seems to be trying to avoid saying anything about changing “methods. She admitted only to “little changes” – “a change in instruments, a change in where they’re grasping the tissue” to increase the success of fetal tissue donation (SPR, pp. 358-9).

Interestingly enough, PP Witness #1 was the Planned Parenthood executive in charge of PPFA Manual of Medical Standards and Guidelines. That includes a guideline that “Notation signed by the clinician performing the abortion that . . . . no substantive alteration in the timing of terminating the pregnancy or of the method used was made for the purpose of obtaining the blood and/or tissue.” PP Witness #1 admitted she had “never signed a statement to this effect,” even though she had indeed had been one of the clinicians performing abortions at Planned Parenthood.

Democrat Defenders

Supporters of Planned Parenthood on the since disbanded Select Investigative Panel tried to argue that none of the admissions amounted to a confession that anyone had actually changed from one surgical method to another. Small “adjustments” were made to technique for clinical reasons, they asserted, “always intended to achieve the women’s desired result as safely as possible” (Select Panel Democrats response “Setting the Record Straight,” hereafter “SRS,” pp. 62-3).

Democrats elicited testimony from PP Witness #1 that she hadn’t actually altered an abortion procedure and knew of no one who had. She also testified that neither she nor any of her colleagues had ever relied on “illegal partial birth abortion procedures’ to obtain fetal tissue or for any other purpose.” In fact, she assured counsel that “all of Planned Parenthood colleagues have to document how they complied with the ban” (SRS, p. 63).

Though they joined panel Republicans in seeking financial records, Democrats on the panel appeared to have been satisfied with loose and limited explanations Planned Parenthood and Stem Express gave for their expenses (SRS, pp. 2, 46-7, 55-6).

Democrats took a great deal of time in their response to defend Planned Parenthood, the tissue brokers, and “life-saving” fetal tissue research. In response, the select panel went to great pains to point out the paucity of promising research with fetal tissue, saying that most modern medical researchers were investing their time and money in other more promising projects (SPR, pp. 373-99).

What happens next

The panel made multiple criminal and regulatory referrals to local district attorneys, the U.S. Department of Justice, and other federal agencies, asserting that, among other legal and regulatory violations, Stem Express and Planned Parenthood may have illegally profited from sale or transfer of fetal tissue for “valuable consideration” (SPR, Chapter 4).

Whether those charges will be pursued and if so, whether courts and judges will hold Planned Parenthood, Stem Express and the other tissue brokers accountable, will have to be seen.

But with a new pro-life administration joining a pro-life House and Senate, Congress may have the last word.

The Panel’s Recommendations

Members of the Select Panel made a number of recommendations to address problems uncovered by the report. They called for enforcing laws already on the books on selling fetal tissue for profit and strengthening and clarifying language about “changing the method of abortion.”

The panel also recommended “Defunding Planned Parenthood and ensuring that grants no longer available to Planned Parenthood are awarded to healthcare providers that provide comprehensive preventive healthcare for their patients and that do not perform abortions (that are not covered by Medicaid under the Hyde Amendment)” (SPR, p. xlii, elaboration on p. 407).

Planned Parenthood has tried to tell the public “nothing to see here.” Speaking through their elected representatives, Americans who saw those videos said “Not so fast.”

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In Parts Two and Three, we will look at some other troubling things uncovered by the select panel’s investigation – late abortion practices in America and the all-too-cozy relationship that exists between some of the country’s top universities and local abortion clinics.

[1] The select committee report never identifies this individual by name, indicating only that “[PP Witness #1] is an abortion provider in Los Angeles, California, an executive with the Planned Parenthood Federation of America (PPFA) who is in charge of the PPFA Manual of Medical Standard and Guidelines.