The Supreme Court announced on Monday that it will review the 2010 health-care act, which comes as no surprise to those closely watching the court. Last year’s sweeping healthcare reform law drew more than 30 lawsuits challenging its constitutionality.  The Supreme Court announced it will hear appeals on five of those lawsuits and consider at least four separate legal issues.

Supporters of the law are reeling over the court’s announcement that among issues the court will consider is a long-shot challenge to the health mandate over a provision that extends Medicaid to cover a greater number of the poor.

Twenty six Republican state attorneys general and governors filed a challenge to Medicaid expansion contenting that the expansion amounts to an unconstitutional coercion of state governments, which provide part of Medicaid’s funding.

The Affordable Care Act vastly broadens the minimum eligibility requirements for Medicaid, which provides health insurance to the poor and disabled with a combination of federal and state dollars.  Under the old rules, in exchange for federal grants that covered 50 to 80 percent of their Medicaid costs, states had to offer coverage to all children in families with annual incomes below the federal poverty level for a family of four as well as selected children with higher incomes and some adults with lower ones.

Beginning in 2014 under the new health care law, states will be required to cover all residents with incomes up to 133 percent of the poverty level, including childless adults, adding an estimated 17 million uninsured Americans to Medicaid’s rolls.  The federal government will initially foot the entire bill for covering those newly eligible, but then the federal government’s share will eventually drop to 90 percent by 2020 and beyond.

The Obama administration contends that it has every right to change the eligibility rules for Medicaid because it is a voluntary program.  Congress gives states Medicaid funding in exchange for meeting certain conditions, and if states do not agree with those conditions, they are free to withdraw at any time.

The states in their lawsuit argue that Medicaid expansion is different because the amount of federal assistance at stake is so large and so necessary to the welfare of the residents of their state that the states do not realistically have the choice to withdraw and, in essence, holding the states hostage.

The court is scheduled to hear arguments in March, with a decision likely in late June or early July in the midst of the presidential campaign.

 

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