Covering the Uninsured With Medicaid Expansion
Beginning in 2014, under the Affordable Care Act, states will be asked to cover all individuals younger than 65 with incomes up to 133 percent of the poverty level. Although the federal government will initially fund 100 percent of the expansion, states will be responsible for 5 percent of those costs by 2017, with that number increasing to 10 percent by the end of the decade.
Government arguments: Congress' spending power includes the power to fix the terms in which it will disburse funds to the states. Under the Affordable Care Act, the government said, initially, it will bear nearly the entire cost of medical assistance for individuals made newly eligible and that the states' spending will be offset by other savings the states will achieve as a result of the ACA changes. If a state is unhappy with the conditions placed on the funds, it is free to opt out of receiving them.
Challengers: Paul Clement said that, unlike past expansions of Medicaid, the law's provision creates a "dramatic transformation" of the federal-state partnership. He said the law "coerces" states into participation. His central argument is that because Congress made the new terms a condition of continued participation in Medicaid, no state could reasonably expect to withdraw. He said the sheer size of the expansion -- which he estimates will cost states about $20 billion by 2019 -- and the link to the individual mandate means the states have no practical ability to turn down the money.
While no lower court has struck down the law's Medicaid expansion, if the Supreme Court were to do so, the ruling could potentially affect other state-federal programs dealing with issues from highway funding to education.
Unlike the other branches of government, the Supreme Court deliberates behind closed doors and leaks are almost unprecedented. The court is expected to release its decision on the case during the last week of the term, which begins June 25, a date that falls less than five months before the next presidential election.