Perry Bacon Jr. reports in the November 3rd Washington Post:

The abortion dispute centers both on federal subsidies that would be provided for people who cannot afford health-care coverage themselves and the much-debated government insurance alternative, which is included in the House version of the bill but is still being debated in the Senate. Under a 1976 law, federal funds are generally barred from being used for abortions, except in cases of rape or incest or to ensure the life of the mother.

This is just plain false. Bacon is in no dount referring to the Hyde Amendment when he mentions the “1976 law.” Problem is the Hyde Amendment is not law. Look for it in the Federal Code and you will not find it anywhere.

First passed in 1976 by Rep. Henry Hyde (R-IL) as a rider to the Health and Human Services appropriations bill, the Hyde amendment must be passed again every year as part of the HHS appropriations bill and even then it only applies to current HHS programs. The Hyde amendment would do nothing to stop Obamacare from funding abortions  and all the versions of Obamacare passed by Congressional committees so far do exactly that. Bacon continues:

Democratic leaders early this summer backed a provision that would allow people to use subsidies under the bill to buy insurance plans that cover abortion, but only funds from individual or employer health-care premiums could go toward paying for an abortion. Effectively, insurance companies would be tasked with segregating money from government payments from those coming from private sources, and only the latter could be used for abortion.

This is actually pretty fair description of thedispute as it stands now, but Bacon should have gone further in reporting on how the language in the House bill differs from how the Department of Health and Human Services (HHS) currently ensures that no Medicaid dollars are used to pay for abortions, per the Hyde Amendment. Heritage fellow Dennis Smith explains how the process works:

Medicaid claims must be supported by sufficient documentation. The Social Security Act requires “agreements with every person or institution providing services under the State plan under which such person or institution agrees (A) to keep such records as are necessary fully to disclose the extent of the services provided to individuals receiving assistance under the State plan, and (B) to furnish the State agency or the Secretary with such information, regarding any payments claimed by such person or institution for providing services under the State plan.”

The prohibition on Medicaid funding of abortion extends to services provided ancillary to an abortion, and a state is obligated to have sufficient controls in its claims processing system to ensure that only allowable costs are paid by Medicaid (regardless of whether the funds are federal or state Medicaid funds).
…
The health care bills currently before Congress do not contain adequate safeguards to prevent federal funding of elective abortion, assurances by their supporters notwithstanding. Unless a specific prohibition on abortion funding–with strong enforcement and accountability–is contained in the final bill that is signed by the President, the government will end up funding the procedure.