Supreme Court Curbs Health Reform Expansion of Medicaid

While the Supreme Court narrowly ruled the Affordable Care Act constitutional, it did place some important restrictions on a Medicaid expansion that is a backbone of the law's efforts to insure more Americans.

In addition to requiring citizens to buy health insurance, the law also expanded Medicaid and tied federal funding to that expansion of state programs. In order to provide insurance to more poor people, the law said that states who did not accept the Medicaid expansion would risk losing existing Medicaid funds.

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Today the Court said that as long as states who chose not to participate in the law's expansion of Medicaid do not lose existing funds the Medicaid the expansion is constitutional The vote was 5-4 with Chief Justice John Roberts joining the liberal bloc.

The end result could be that more states opt out of the Medicaid expansion, which won't be enacted until 2014, and the law could end up insuring fewer currently uninsured Americans.

The bottom line from Roberts: "The Court today limits the financial pressure the Secretary may apply to induce States to accept the terms of the Medicaid expansion.As a practical matter, states may now choose to reject expansion; that is the whole point."

But what is interesting is that liberal justices like Elena Kagan and Stephen Breyer joined the five conservatives to insist that the states couldn't be threatened with a loss of funding.

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"Although many will be surprised that Chief Justice Roberts joined the Court's progressive bloc to uphold the mandate, the far bigger surprise is that two members of that bloc-Justices Breyer and Kagan-joined the conservatives in holding that the Medicaid expansion exceeded Congress's power," says Stephen Vladeck, of American University Washington College of Law." As a matter of precedent rather than politics, the Breyer and Kagan votes on Medicaid are likely to be far more significant going forward than the Roberts vote on the mandate," he said.

Paul Clement, an attorney for the states called this part of the ruling a "significant victory" he said. "The states will have a chance to make the choice. They will no longer have the gun to their head."

Renee M. Landers of Suffolk University Law school says the impact of today's ruling, "could reduce the number of people who will be eligible for Medicaid because it is easier for the states to opt out."