Supreme Court Ruling on Medicaid Could Affect Other Federal-State Programs, Antidiscrimination Laws

by Rebecca Farley on March 8, 2012

When the Supreme Court rules on the constitutionality of the Affordable Care Act’s Medicaid expansion, the decision could have ramifications far beyond the question of whether states must add low-income individuals to Medicaid. Many other federal-state programs could be at risk, including foster care and child support enforcement programs, federal funding for public schools, antidiscrimination protections based on disability, and more.

At issue in this legal challenge is the question of whether the Medicaid expansion is an unconstitutional “commandeering” of state power. In their lawsuit against the ACA, Florida and 25 other states argued that the ACA coerces them into expanding Medicaid by making it a condition of receiving any federal funding for Medicaid at all. The 10th Amendment to the Constitution protects states from being forced to carry out a federal program, and the states are arguing that they are essentially being forced to comply with the expansion because Medicaid is the only means of covering the poorest Americans under the ACA.

However, no federal court has ever ruled a federal law unconstitutional on the basis of this argument. It is longstanding legal precedent that the federal government can require states to meet specific conditions if they accept federal money for that program. Since the establishment of Medicaid, Congress has steadily moved to expand the categories of individuals who must be covered by Medicaid and has created new requirements governing the benefits that must be provided. As Sara Rosenbaum and Timothy Jost wrote in a recent article of the New England Journal of Medicine, “from a legal perspective, nothing about this latest Medicaid expansion is different from past expansions, other than the fact that is passed as part of a broader health care reform effort. This fact does not change Medicaid’s fundamental status as a voluntary program.” Moreover, the federal government will foot 100% of the bill for the Medicaid expansion during the first year the expansion is in effect.

Nonetheless, the Court has decided the states’ arguments have at least enough merit to warrant a hearing. And how they decide the Medicaid issue will have a far-reaching impact similar programs that are run as a partnership between the federal and state governments, potentially opening them up to similar legal challenges on the basis of the federal coercion theory. Many of these programs are critical parts of the safety net. They include programs funded under the Individuals with Disabilities Education Act (IDEA), Title I of the Elementary and Secondary Education Act (ESEA), federal foster care and child support enforcement programs (including Title IV-E funding), and programs that protect people against discrimination on the basis of race, gender, and disability.

Oral arguments on the Medicaid expansion are scheduled for Wednesday, March 28, and a decision is expected by June. Click here for the National Council’s summary of the other points at issue in the health reform law challenge, and stay tuned to our communications for future updates and analyses of the case.


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