Everyone’s focused on the individual mandate, but let’s talk Medicaid. The Supreme Court ruled that the Affordable Care Act unconstitutionally coerced the states into signing up for a Medicaid expansion, and the federal money that comes with it, by threatening them with a total cut-off of Medicaid funds if they didn’t accept. The court remedied this constitutional violation by saying that the Department of Health and Human Services could not reduce the states’ existing Medicaid funding, only the additional money they would have gotten.
This outcome gives the Red states that brought the lawsuit brand-new leverage. It will be a lot easier for them to tell HHS to take its Medicaid expansion and shove it. True, they would be forfeiting huge dollars in the short run — but don’t forget that GOP governors like Rick Scott in Florida, Scott Walker in Wisconsin and John Kasich of Ohio turned down big grants to build high-speed rail, because of the risk of future liabilities that the feds would not cover. In short, one of the main ways the Affordable Care Act achieved universal coverage – Medicaid expansion – may have been weakened, significantly.
What’s even more astonishing is that the court reached this result with the support of its liberal justices. In fact, there were seven votes to holding that the Medicaid expansion was unconstitutionally coercive: Chief Justice John G. Roberts Jr. enjoyed the backing not only of the other four conservative Republican appointees, but also liberals Stephen G. Breyer and Elena Kagan. Pretty impressive for a contention that garnered no takers in the many lower courts to consider the matter.
The four conservatives — Justices Antonin Scalia, Anthony M. Kennedy, Clarence Thomas and Samuel A. Alito — would have solved the coercion problem by striking down the whole law. They weren’t interested in any half-way remedies. That would have left Roberts with just three votes — his, Breyer’s and Kagan’s — but then two more liberals, Ruth Bader Ginsburg and Sonia Sotomayor, acceded to the remedy, in spite of their view that the Medicaid expansion was perfectly constitutional.
Why? Ginsburg explained, in essence, that half a loaf was better than none; this was the only way to ”conserve” Congress’s “dominant objective,” even partially. Thus did the first Supreme Court ruling ever to hold a federal-state spending program unconstitutionally coercive — a ruling that inevitably opens the door to more such challenges to federal programs in the future — receive a bipartisan imprimatur.
Even more amazing, both Breyer and Kagan went along with Roberts having previously attacked the idea that the law was coercive at all, let alone unconstitutionally so, at oral argument. Kagan said the Medicaid expansion was like a “gift” to the states of a “boatload of money.” She told Paul D. Clement, the lawyer for the challengers: “It doesn't sound coercive to me, I have to tell you.”
Equally animated, Breyer suggested that the threat of coercion was chimerical, because “a basic principle of administrative law” would have given the states protection against any “unreasonable” cut-off of funds.
What accounts for this seemingly profound change by the liberals? Well, you could say all that rhetoric at oral argument was just for show – a bunch of provocative hypotheticals – and that these two justices have never been as supportive of federal power as their entire previous careers might suggest.
But that doesn’t seem too likely.
Or you could say that this was part of the price they paid to secure Roberts’ vote to uphold the individual mandate as an exercise of Congress’ taxation power, when faced with the far greater threat of a 5-4 conservative bloc vote to strike down the entire statute. But then you’d have to believe that Supreme Court justices engage in negotiated voting, which we know, from their repeated public denials, does not happen.
What might have sweetened this bitter pill for the liberals is that the court’s remedy for the constitutional violation was first suggested by the Obama administration itself, on the last two pages of its brief, which proposes that any finding of coercion could be dealt with in just the manner that the court eventually chose.
And so we are left to ponder the fact that liberal justices agreed to a holding that salvages a diluted version of the ACA’s crucial Medicaid provisions for now — at the cost of laying a bipartisan precedent for further challenges to federal power in the future.