When the Supreme Court announced its decision regarding the constitutionality of national healthcare reform, it quite possibly breathed new life into an overused but true healthcare cliché if you've seen one state Medicaid program you've seen one state Medicaid program. And believe me, that saying is so old, it hurts to type it. But due to a key ruling by the court, states once again have the ability to structure their Medicaid programs as they see fit but with a financial caveat attached.
As it was originally written, the Affordable Care Act was designed to simplify an overcomplicated and bureaucratic program and make Medicaid eligibility standard across all states. Rather than eligibility predicated on being a pregnant mom or disabled, for instance, the ACA expanded Medicaid to include all Americans with incomes below 133 percent of the federal poverty level, or roughly $30,000 a year for a family of four. It was expected to extend health coverage to 16 million to 20 million new members and transform Medicaid into a healthcare safety net. States had no choice under the ACA but to go along with the expansion, as they would be stripped of their existing Medicaid funding if non-compliant a financial blow no state could endure.
The federal government did sweeten the deal by agreeing to pick up 100 percent of the tab from 2014-2016, before dropping down to 90 percent. However, the Supreme Court had a problem with the stick part of that equation. Chief Justice John Roberts, writing for the majority, said the financial inducement Congress has chosen is much more than relatively mild encouragement it is a gun to the head.
The court ruled the Medicaid expansion could continue, and states going this route would receive the extra federal funding. However, the court gave states the ability to continue with their Medicaid programs at minimum coverage levels while maintaining existing Medicaid funding. This allows them to forgo the expansion and the significant extra federal funding, as well.
At first glance, the Supreme Court ruling took a plan to streamline Medicaid and turned it into what could be a state-by-state mess. After all, 26 states participated in the federal lawsuit to have the healthcare law overturned, though it is inconceivable to think all 26 would leave significant federal funding on the table and shun the expansion. But the flurry of questions that arose after the ruling shows how complicated the matter now is: Will highly conservative states automatically opt out to strike back at President Barack Obama. Will states whose programs already surpass the federal income minimum reduce Medicaid eligibility. If this occurs, will the central theme of the law provide significantly expanded healthcare coverage be gutted.
High-ranking Republicans in Mississippi and Missouri certainly not bastions of generous Medicaid eligibility levels have indicated their respective states will not be expanding, even with the federal money available. Wisconsin Republican Gov. Scott Walker, a conservative hero, has indicated Wisconsin's game plan is to do nothing, and hope Mitt Romney captures the presidency in November. Wisconsin has a generous Medicaid program and provides limited coverage for childless adults already, but Walker refused to say if the state would continue down this path or scale back. In Virginia, Republican Gov. Bob McDonnell blasted the Medicaid expansion as unsustainable, but didn't commit his state one way or the other, as did Florida Gov. Rick Scott.
The question becomes this: Will the majority of these states opt out, or is this political grandstanding. Sure, states are wary the federal support could get cut and they'd be on the hook for the added cost. But the intense political atmosphere is fueling a lot of the venom, and in the end, there will simply be too much pressure on state governments to not take part from hospitals, Medicaid managed care plans, activists, etc.
Sure, a state here or there will stick to their guns and opt out (Texas anyone), but conservative lawmakers already have some political cover. Conservative governors can tell their red-state constituents that they achieved a victory by winning back their freedom of choice from the overreaching feds. That, they can say, is what the battle was truly about. And given that freedom of choice, expect an overwhelming majority of states to take the money and expand.
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