States Continue Medicaid Expansion Debate

As President Obama responds to healthcare.gov’s glitches, many states continue to debate whether to expand the Medicaid program in their respective states. The Supreme Court’s decision on the Affordable Care Act (“ACA”) allows states to opt out of the ACA’s Medicaid expansion provisions. Many states have stated their Medicaid expansion plans definitively; however, not all states have spoken.

Participation in the Medicaid program is voluntary. All states currently choose to participate. States’ participation is conditioned on compliance with certain federal rules, including certain eligibility criteria. The Medicaid program currently offers federal funding to participating states to assist pregnant women, children, needy families, the blind, the elderly and the disabled in obtaining medical care.  The ACA included a provision to further enhance these eligibility requirements by requiring participating states to cover nearly all non-disabled adults under age 65 with household incomes at or below 133% of the federal poverty limit (“FPL”) as of January 2014. However, as originally written and interpreted, if a state did not expand its eligibility criteria consistent with the ACA, the state could have lost all of its federal Medicaid funding, not just funding allocated toward the expansion.

Florida, joined by 25 other states, initiated a lawsuit challenging the constitutionality of the ACA’s Medicaid expansion. Another lawsuit was initiated by the National Federation of Independent Business in Florida on the topic. These two cases were considered together by the Supreme Court of the United States (‘SCOTUS”) in National Federation of Independent Business v. Sebelius.

In its June 28, 2012  opinion, the SCOTUS held, among other things, that the ACA’s Medicaid expansion provision was unconstitutionally coercive. The practical effect of the SCOTUS’s opinion makes the ACA’s Medicaid expansion optional for states. This is because if states do not comply with the expansion, the Secretary of the U.S. Department of Health and Human Services may only withhold the ACA Medicaid expansion funds and may not withhold all or part of a non-compliant state’s federal funds for the rest of the Medicaid program.

As the end of the year begins to approach, the debate within each unspoken state of whether to expand its Medicaid program continues. By way of example, on October 21st, the Ohio Controlling Board voted 5-2 in favor of expanding its Medicaid program.  This vote allows Ohio Governor John Kasich to expand the program by bypassing the republican-controlled legislature. A day later, a group of Ohio republican lawmakers and two anti-abortion groups based in Ohio filed a lawsuit challenging the vote, however, alleging that the Ohio Controlling Board abused its discretion and exceeded its authority by effectuating such a major policy change that is contrary to the legislature’s expressed intent.

With the countdown until the new year ticking, expect additional states to start speaking.

For information specific to your state, the Kaiser Family Foundation tracker is a useful resource.

Leave a comment

Filed under Health Reform, The Affordable Care Act

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s