The Most Difficult Business You Could Run
Why it’s so hard to run an abortion clinic–And why so many are closing.
Hoping to publicize her new nonprofit, last fall Julie Burkhart called her local NPR affiliate, KMUW in Wichita, about buying a day of sponsorship for $480. Station manager Debra Fraser decided immediately that KMUW wouldn’t allow it. “I didn’t want to upset the apple cart,” Fraser says.
The response wasn’t new to Burkhart. In April 2013 she had reopened and renamed Women’s Health Care Services, where her former employer and mentor, Dr. George Tiller, provided abortions from the 1970s until 2009, when he was shot in the head and killed while ushering at his church. Today, South Wind Women’s Center offers abortion and OB-GYN services as well as transgender care such as hormone therapy. Burkhart hopes to install a birthing center. In the basement, Trust Women, the center’s umbrella nonprofit, runs a political action committee, continuing the advocacy Tiller began in the 1980s.
“We are only asking to be treated like any other business that provides health care,” Burkhart wrote in a letter to KMUW appealing the station’s rejection. She says a man in the development office told her that if the station accepted South Wind’s sponsorship, it would have to accept sponsorship from anti-abortion organizations, too. “The fundraiser in me thought, What’s the problem with that?” Burkhart says with a laugh. But she was taken aback, she recalls, when he asked if she thought KMUW should also take donations from the Ku Klux Klan. About that, Fraser says: “I certainly would hope that no one on my staff would say that. That doesn’t represent what I said to Julie.”
Burkhart and Fraser met for lunch. Fraser had previously worked at a Texas station where listeners frequently called to complain about Planned Parenthood’s sponsorship. As a news organization reliant on listener support, KMUW couldn’t afford to create the perception that it was “taking a stand” on abortion, Fraser says. “If I were you,” she remembers telling Burkhart, “I’d be really upset about this. But I can’t help you.”
The stigma around abortion prevents Burkhart’s nonprofit from performing many of the everyday transactions essential to businesses. She and other clinic owners have had trouble securing mortgages, medical insurance, contractors, and someone willing to deliver Band-Aids and bottles of water. Especially in rural and conservative regions, a wide range of companies and organizations decline to work with abortion providers, either for reasons of personal conscience or because of fears that being associated with abortion will cost them business.
In recent years states have enacted hundreds of laws designed by activists to make it more difficult—and more expensive—to perform abortions. Twenty-two states require abortion clinics to follow codes comparable to those of ambulatory surgical centers; at least 11 states specify the width of clinic rooms or hallways. Many clinics struggled to stay in the black well before legislation required them to remodel their corridors.
A common allegation by anti-abortion activists is that the doctors providing such services are in it for the money. “Their focus is where the dollar is. It’s not protecting women,” says Melissa Conway, a spokeswoman for Texas Right to Life. “Especially within the last few years, the cost of abortion services is increasing, and so it’s a very profitable business.” For many anti-abortion advocates, that standalone clinics provide most abortions is proof that “abortionists” are seedy characters who aim “to garner financial gain on the backs of women,” as Conway puts it. Texas Right to Life and its parent organization declined multiple requests for evidence that running an abortion clinic is lucrative.
The numbers suggest the opposite. The average amount paid for an abortion nationwide—about $450 for the most common procedures—has been relatively stagnant for decades, despite inflation in other areas of medicine and higher costs. In the 1970s anti-abortion attorneys formed a decadeslong plan to craft and lobby for state regulations that would gradually strip away physicians’ ability to provide the procedure. Much of the legislation makes it more expensive for clinics to operate, and the strategy has proved effective. Since 2011 at least 162 abortion providers have closed or stopped performing abortions, and 21 clinics have opened. That represents the swiftest annual decline in the number of abortion providers ever, according to Bloomberg News. Burkhart is working to start another clinic, in Oklahoma City, which she estimates will cost $1 million. No one has opened an abortion clinic in Oklahoma since 1974.
In 1976, Congress passed the Hyde Amendment restricting the use of federal funds for abortion, which Americans United for Life helped defend before the Supreme Court in 1980. In 33 states, Medicaid can’t be used to cover the procedure in most circumstances. Recent polling finds that almost half of women who obtain abortions live below the federal poverty line. Meanwhile, 10 states, including Kansas and Oklahoma, ban all insurance plans—and 25 states restrict government marketplace plans—from covering abortion except in rare circumstances. With a large share of women, including the poorest patients, paying out of pocket, many abortion providers keep their prices low. “What you’re doing is—as much as you can—not pricing people out of getting this service,” says David Burkons, a physician who opened a clinic in Ohio last year.
Clinic directors say the political climate has made it almost impossible to open clinics. “You’d think, This is crazy,” says Amy Hagstrom Miller, founder and chief executive officer of Whole Woman’s Health, which has acquired or opened clinics in five states since 2003. She’s the plaintiff in the coming Supreme Court case over abortion laws that have shuttered two of her five Texas locations. Arguments begin on March 2. The extra costs she and other providers face are at the heart of the case: The decision will largely come down to whether the justices think the laws have made it too expensive for clinics to operate—and to what extent that burdens patients. Says Hagstrom Miller: “This is probably the most difficult business you could ever run.”
South Wind is the only abortion clinic for at least 150 miles in any direction. The two other abortion providers in Kansas are a Planned Parenthood affiliate and a private practice in Overland Park, almost 200 miles away. Because there are so few places to get an abortion in the region, patients often come from Oklahoma, Missouri, and Texas. Every week, Burkhart flies in a physician willing to perform second-trimester abortions. South Wind spends about $20,000 on airfare annually, and sometimes patient and doctor travel across state lines to meet at South Wind.
Set on a service road in a working-class neighborhood, the clinic is squat, windowless, and surrounded by a tall cedar fence “like a bunker,” as one staff member says. After a makeover by a donor, the waiting room looks like an upscale therapist’s office. Neutral-toned chairs face a painting of irises. The lights are dimmed. The soothing atmosphere is meant to counteract everything patients pass through to get there.
At the mouth of the parking lot, Kansas Coalition for Life protesters record each visitor’s license plate number and time of entry and track which car belongs to each staff member. On a morning in October, they wait beside a banner that says “Every abortion is a cruel and barbaric act of violence” and shows a mutilated, unclothed man in a Christlike pose. Nearby is a trailer covered with a giant photograph of a fetus. After an armed security guard opens the locked door, he instructs visitors to empty their purses and walk through a metal detector. Burkhart estimates South Wind spends a minimum of $45,000 on security each year.
In her office, Burkhart gets off the phone with her attorney and makes another pot of coffee. She’s tall and makes matter-of-fact statements in a flat timbre. Raised by a feminist mother (“listening to Free to Be … You and Me”), Burkhart, 49, first interned at an abortion clinic as a college student. A family tragedy interrupted her plans to go to medical school, so she’s divided her career between reproductive-rights work and other political advocacy. She ran Tiller’s PAC for seven years.
South Wind is expanding to Oklahoma because the doctor at one of the two remaining abortion clinics in the state is old enough to retire. Since states such as Kansas and Oklahoma prohibit publicly funded entities from performing most abortions, local hospitals can’t train the next generation to replace aging doctors. Nationwide, medical schools don’t offer abortion training. All OB-GYN residencies are supposed to offer access to abortion training, but a 2013 survey published in the journal Contraception found that not all do.
OB-GYNs who do receive training rarely end up offering abortions once they’re in practice, often because their workplaces don’t allow it. In the U.S., 9 of 10 abortions are first-trimester procedures that are medically simple enough to be done in a doctor’s office at little expense. Across the country, though, anti-abortion groups have protested and led boycotts against OB-GYNs who offer abortions; even when their doctors are pro-abortion rights, gynecology practices usually decide against offering the procedure to avoid jeopardizing their business. And hospitals are also risk-averse: They perform just 4 percent of the country’s abortions. Many are prohibited by mandates from the religious institutions that run them or local governments. Others have little incentive to wade into divisive politics. When insurance does reimburse for abortion, the rates are usually low, says Lori Freedman, author of the book Willing and Unable: Doctors’ Constraints in Abortion Care.
As a result, clinics perform 94 percent of abortions in the U.S. Planned Parenthood is the single largest provider, but the majority of clinics, like South Wind, are independent nonprofits or small businesses. To function, they must contend with standards that vary from state to state. Advocacy organizations including Americans United for Life and National Right to Life have spent 40 years drafting and lobbying for rules that make operating abortion clinics highly difficult, such as the requirement that the clinics meet surgical center standards.
Ambulatory surgery centers, or ASCs, are expensive to build and maintain. Their guidelines are written for procedures that require operating rooms, so specialists must be hired to set up heating, ventilation, air conditioning, and electrical systems that are more complicated than those in clinics. It’s the difference between buying a Ferrari and a Volvo, according to one architect who designs ASCs but doesn’t want to be named because some of his clients are opposed to abortion. The surgery centers are required to have a separate source of electricity in case of an outage, and generators can cost $50,000 apiece. In Oklahoma, where labor and materials are relatively cheap, building a clinic would cost about $175 per square foot; an ASC would run about $258. The architect says that on average, a single 300-square-foot operating room costs about $1 million, land excluded. Equipment generally costs an additional $500,000 per OR.
Oklahoma has no ASC requirement. But in July, Burkhart submitted an application to the state to open one, because she wanted to provide abortions up to the legal limit of 24 weeks of pregnancy. The lot and building—a former optometry practice—cost $300,000. Renovations required an additional $550,000. Burkhart’s architect (not the one who compared surgery centers to Ferraris) was ready to start demolition but was stalled waiting for a license from the state.
In late August, Burkhart finally heard back. The Oklahoma State Department of Health sent her a letter saying the state wouldn’t allow abortions to be performed in a surgery center. Burkhart and her lawyers resubmitted their applications. “Now they’re saying you can’t do abortions in a more highly regulated environment!” Burkhart says in October. “I already have invested in this project—just cash, well over $100,000.” She checks her e-mail again, hoping to find a message from the health department, which said she’d get word by that day. “We’re on pins and needles,” she says.
In December, Burkhart received initial approvals, and demolition began. Construction started in January. If all goes according to plan, the state will inspect the site twice in the coming months, and the clinic will be open by summer.
The American Medical Association and the American Congress of Obstetricians and Gynecologists have filed legal briefs in the coming Supreme Court case calling ASC requirements unnecessary and illogical.
In 2013, Texas required that abortions be performed in ambulatory surgery centers. A spokeswoman for Whole Woman’s Health says it called every ASC in Texas asking if it could rent their space after-hours. All 250 declined. The monthly overhead for operating its single ASC in Texas runs $40,000 higher per month than a standard clinic. In 2015 the company opened a clinic in New Mexico to serve the women of West Texas.
In Ohio, Burkons was the only OB-GYN to open a clinic providing surgical abortions in at least the past five years. When he began performing abortions at Northeast Ohio Women’s Center in August, it was after 18 months of back-and-forth with the Ohio Department of Health, which he estimates cost him about $100,000. Burkons has been practicing medicine since 1973. In 2013 he decided to take over a clinic closing in Cuyahoga Falls that included a surgery center. Burkons started paying the building’s $2,500 monthly rent and took out malpractice insurance. A colleague from another clinic advised hiring a consultant to help him pass the state inspection required of all ASCs when they reopen under new management. “I thought, Eh, I don’t need it. We know what’s wrong, and we’ll fix it. Why spend the money?” Burkons says. “I had been working in the abortion field. I was well-versed in it. I was very naive in figuring that [the Department of Health] is a state agency and they’re going to treat you fairly.”
Ohio Department of Health documents obtained by Burkons’s attorney show that 33 other health-care facilities that applied for licenses from 2011 to 2015 waited a median of about 15 days between being inspected and receiving a license or a plan of correction that led to a license. Five months after his inspection and pressure from his attorneys, whose $400-per-hour rates quickly added up to about $15,000, the Ohio Department of Health told Burkons that because of six violations, it was denying his license. According to a list of ASC license requests issued by the state, all seven of the other surgical centers cited for violations from 2011 to 2015 were not denied and were allowed to make immediate corrections.
Burkons attributes the heightened scrutiny to politics: In 2012, Governor John Kasich appointed Ohio Right to Life’s president, Michael Gonidakis, a lawyer with no medical background, to the state’s medical board, which oversees physician licenses. Katherine Franklin, a spokeswoman for Ohio Right to Life, says that in 2013 her organization, with Gonidakis at the helm, successfully lobbied the University of Toledo Medical Center to decline Burkons’s admitting privileges—a new state requirement for physicians performing abortions. But Gonidakis’s position on the state medical board wouldn’t have affected a physician’s application to provide abortions, Franklin says.
After the license was denied, Burkons reapplied. Before the second inspection, he hired consultants for $12,000. They recommended going overboard; if the guidelines called for three smoke alarms, they advised having six. When the state inspectors were done, Burkons says, they told him, “We’re going to submit there are no violations. Normally you’ll have your license within two or three weeks. This isn’t normal. Good luck.” Five months later, in July 2015, Burkons found out he’d been granted his license from an acquaintance, who’d read the news on the Ohio Right to Life website. “There were many days when I would think, What the heck did I do this for?” he says. But providing abortion care is gratifying, because every patient “comes in with a problem and leaves without a problem,” Burkons says. “Where else in medicine can you, multiple times a day, change a woman’s life in five minutes?”
Government regulation is one obstacle to clinics’ providing abortions, but the private sector presents others. Nonprofits have swooped in to subsidize abortion care in the absence of public funds; to stay competitive, for-profits must mirror nonprofit prices. At many clinics, a patient interacts with an administrator, nurse, sonographer, counselor, and physician—during each of at least two visits in 13 of the states with mandatory waiting periods—all for just a few hundred dollars. Hagstrom Miller says Whole Woman’s Health operates at a 1 percent or 2 percent profit or at a loss. “We have made it next to impossible to keep our doors open just from patient receipts,” she says. “In some ways, we’ve done that to ourselves by being so committed to the social justice and human-rights part of our work and knowing the women we serve can’t afford those fees.”
When Burkhart opened South Wind, she raised enough in donations to renovate the facility but still needed a line of credit for everything else. “I spent two years talking to different financial institutions,” she says. “I went from small, very local banks to regional banks to Bank of America, Wells Fargo.” Lenders may have rejected Burkhart’s loan applications because of abortion stigma or legitimate financial concerns; it’s often hard to disentangle the two. (In an e-mail, a Wells Fargo spokesman said the bank can’t share customer information; a Bank of America spokeswoman said in an e-mail that the bank had no information on South Wind.) A clinic director in the South, who asked not to be identified for fear of harassment, says that when she applied for a loan, a bank representative asked her if the state was going to pass laws that would close her practice.
South Wind almost breaks even, taking in about $1 million a year. In addition to construction, staffing is a major cost for clinics. For her Oklahoma City location, Burkhart anticipates hiring four administrators, two or three doctors, and five or six other medical personnel. The market rate for a nurse in Oklahoma City is $60,000; a local OB-GYN on average makes $250,000. Still, Burkhart says, “On paper, we look pretty good.” She hoped that running the Wichita clinic debt-free would make financing the Oklahoma clinic easier, but it took a year to find a regional bank willing to provide a loan for one-third of the construction costs. She won’t name the bank. “I don’t want them to have to undergo any conflict,” she says.
Burkhart isn’t paranoid. Anti-abortion organizations closely monitor and publicize local businesses’ dealings with abortion clinics. One such group is Wichita-based Operation Rescue, whose work, according to its website, is “taking direct action to restore legal personhood to the pre-born and stop abortion in obedience to biblical mandates.” Says its president, Troy Newman: “We do everything legal and moral to make sure these abortion clinics aren’t able to open up. We’ll talk to landlords. We’ll talk to neighbors. We’ll send postcards out asking not to rent, lease, or sell to an abortionist.” Conway, of Texas Right to Life, says that when anti-abortion organizations in her state “hear a rumbling” about an abortion clinic coming to town, activists will go to the local permit office “almost on a daily basis” until documents with contractors’ names are available. Then they blast the contractors with phone calls and organize boycotts.
Kansas Coalition for Life protesters disseminate any names they see printed on the vehicles in South Wind’s lot. The day Burkhart’s architect accepted the job at South Wind, he disabled his home answering machine; he’d received angry calls from across the country.
A clinic director in the South says she spends untold hours dealing with problems that would be easy to solve if local businesses were willing to work with her. She taught herself to repair a hydraulic bed because no local handyman would come by. Whole Woman’s Health has a full-time staffer designated for wrangling vendors. When it opened the clinic in New Mexico, the phone company installer repeatedly stood up the staff for three months. Lamar Billboards rescinded a contract to sell Whole Woman’s Health ad space explicitly because the company provides abortions, says Fatimah Gifford, a spokeswoman for Whole Woman’s Health. (Lamar declined several requests for comment.)
None of these obstacles by themselves is enough to prevent a clinic from providing abortions, but their cumulative effect can shutter clinics by raising the difficulty and cost of doing business to unsustainable levels. “If anybody asked me, ‘Should I try this?’ I’d probably tell ’em no,” Burkons says.