A tie vote among 14 federal appeals court judges in New Orleans allows Planned Parenthood facilities in Louisiana to keep receiving Medicaid funding.
The money in question goes to health services other than abortion for low-income women. However, abortion opponents have opposed any government funding for the organization.
In 2015, a federal judge blocked a move by then-Gov. Bobby Jindal's administration to cut off the funding. A three-judge panel of the 5th U.S. Circuit Court of Appeals later upheld that block.
The state sought a rehearing.
On Tuesday, with three current vacancies on the 17-member court, that motion failed on a 7-7 vote.
The decision comes as President Donald Trump has nominated three people for the court, including attorney Kyle Duncan, who has defended abortion restrictions in the state.