August 17, 2017 (LifeSiteNews) – A federal appeals court ruled Wednesday that Arkansas can prevent Planned Parenthood from receiving Medicaid funding over its sale of aborted baby body parts.

Arkansas is first state to win in federal court its right to defund Planned Parenthood in Medicaid.

In a 2-1 decision, the U.S. Court of Appeals for the Eighth Circuit sided with Arkansas. This ruling undid a judge's previous injunction forcing Arkansas to keep giving funds to the abortion provider.

In 2015, Gov. Asa Hutchinson severed ties with Planned Parenthood after the Center for Medical Progress released undercover videos showing the abortion company trafficking fetal body parts. This led to a two-year court battle that initially forced Arkansas to continue funding Planned Parenthood.

The ruling seemed to hinge on a technicality that Planned Parenthood had three anonymous patients sue over the Medicaid ban rather than challenge "the termination through an administrative appeal and judicial review in the Arkansas courts."

The patients argued that the Arkansas Department of Health and Human Services "violated a federal right of the patients under the Medicaid Act to choose any 'qualified' provider that offers services that the patients seek," according to court documents. But the Medicaid Act "does not unambiguously create a federal right for individual patients that can be enforced," according to the Eighth Circuit court ruling.

It's unclear if an administrative appeal and judicial review would have had a different outcome.

Planned Parenthood commits more than 300,000 abortions annually.

There have been numerous cases of Planned Parenthood committing Medicaid fraud in other states.

"In 2015, the state terminated its Medicaid provider agreement with Planned Parenthood because there was evidence that Planned Parenthood and its affiliates were acting in an unethical manner and engaging in what appeared to be wrongful conduct," said Gov. Hutchinson. "I am pleased with the ruling of the Eighth Circuit today reversing Judge Baker on her injunction that blocked the state from proceeding."

Planned Parenthood said in a press release that it's "evaluating all options" about what to do now. A substantial amount of the release was spent attacking the videos the Center for Medical Progress released of its abortionists and executives.

Arkansas Right to Life posted on Facebook that they are "thrilled" about the ruling.

"We are so happy to have a pro-life governor who protects our taxpayer dollars from going to organizations that kill babies for profit," the group wrote.

"The decision allows the state to proceed with the termination of Planned Parenthood as a Medicaid provider," said Hutchinson. "This is a substantial legal victory for the right of the state to determine whether Medicaid providers are acting in accordance with best practices and affirms the prerogative of the state to make reasoned judgments on the Medicaid program."