Indiana Gov. Mitch Daniels (R) is weighing whether to sign into law a bill that could establish a standard for other states targeting Planned Parenthood – and could help determine his future as a possible presidential candidate.

Last week, Indiana lawmakers voted to approve a measure that would defund the state chapter of Planned Parenthood by $2 million, the amount the group gets each year in federal dollars. The bill would also ban abortions following the 20th week of pregnancy unless a woman’s life is in jeopardy. The measure would also require abortion providers to tell women seeking abortions that life begins at conception, that the procedure is linked to infertility, and that fetuses can feel pain at 20 weeks or earlier.

Other states are also trying to defund Planned Parenthood, but Indiana could be the first to pass such a law. If the Indiana bill becomes law, it would make the state one of the most restrictive in America in terms of where and how abortions are provided. That distinction would help solidify the conservative credentials of Governor Daniels, who is said to be close to announcing a possible White House run.

The bill’s author, state Rep. Eric Turner (R), defended its passage, telling The Indianapolis Star Thursday that it means “pregnant ladies will have a better-informed decision to make.” Representative Turner also said, “The net result will be less abortions in Indiana, and I’m pleased about that.”

Daniels has not yet commented on whether or when he will sign the bill. However, regarding the presidential campaign, he has said he will announce his decision following the end of the legislative session, which is Friday.

Daniels is considered a moderate Republican who last summer told The Weekly Standard that the next president needs to declare “a truce on the so-called social issues” in favor of tackling America’s economic woes. During his two terms as governor, Daniels has preferred to focus on union issues, budgeting, and education.

Daniels can even frame the debate over the legislation involving Planned Parenthood as an economic one. The Indiana Family and Social Services Administration says it fears the state would face a possible loss of $4 million if the state violates federal law, which prohibits states from picking and choosing which groups receive Medicaid dollars. About $1.3 million of the money that the Planned Parenthood chapter in Indiana receives is family-planning money allocated from Medicaid.

Andrew Downs, director of the Mike Downs Center for Indiana Politics at Indiana University-Purdue University, describes Daniels as “very pragmatic” and says the Indiana Attorney General’s Office has been instructed to gather evidence to establish whether federal authorities will penalize the state if the funds are rescinded.

“[Daniels] was not shy about taking [federal] stimulus money,” Mr. Downs says. “He recognizes money from the feds are dollars not coming from the people of Indiana, and he’s OK with us getting our fair share.”

According to state law, a veto from Daniels could be overridden by the state House and Senate, both of which are majority Republican. That could provide him the convenience of not bearing direct responsibility for the measure becoming law. “The provision gives [Daniels] an interesting way to play it politically,” Downs says. [Editor's note: The original version of this story incorrectly described how an override could take place.]

Data from Planned Parenthood in Indiana show that abortions accounted for about 4 percent of procedures given to women in 2010. The group provided 5,580 abortions last year.

Indiana’s Planned Parenthood chapter says it will seek an injunction against the bill if it becomes law. In a statement, president Betty Cockrum said cutting off funding “will mean more unintended pregnancies, more Medicaid-covered births ... and more abortions.”

Indiana also receives $1 million in federal money to fund the Indiana Family Health Council, a nonprofit agency that provides family-planning services to low-income families and teens. The state cannot alter the agency’s funding because it receives the money directly from the federal government – as opposed to Planned Parenthood, which receives its funding indirectly through the state.