The U.S. Supreme Court building
For many people without insurance, a key question raised by the Supreme Court’s decision today to uphold the Affordable Care Act is whether states will decline to participate in the law’s big Medicaid expansion.
Although the court upheld the law’s individual mandate to buy insurance, it found that the act could not force states to grow Medicaid to millions by threatening to withhold federal funding.
The act, signed by President Obama in March 2010, required “states to extend Medicaid coverage to non-elderly individuals with incomes up to 133 percent of the poverty line, or about $30,700 for a family of four,” according to a March 2012 report by the Center on Budget and Policy Priorities, a liberal think tank. That alone was expected to reach nearly 16 million people by 2019, one of the law’s main ways of reducing the ranks of the uninsured.
The 26 states that challenged the law before the court together account for an estimated 8.5 million people who would benefit from Medicaid’s expansion by 2019, more than half the total number, according to ProPublica’s analysis of an Urban Institute report prepared for the Kaiser Family Foundation.
Medicaid is a joint state-federal program that provides health coverage to the poor and disabled, with states putting up a portion of the money and the federal government funding the rest. Each state’s matching percentage is based on per capita income.
According to a separate Kaiser foundation report, “Medicaid currently provides health coverage for over 60 million individuals, including 1 in 4 children, but low parent eligibility levels and restrictions in eligibility for other adults mean that many low income individuals remain uninsured. The ACA expands coverage by setting a national Medicaid eligibility floor for nearly all groups.”
Under the law, the federal government would cover nearly 93 percent of the costs of the Medicaid expansion from 2014-22, according to the Center on Budget and Policy Priorities.
“Specifically, the federal government will assume 100 percent of the Medicaid costs of covering newly eligible individuals for the first three years that the expansion is in effect (2014-16). Federal support will then phase down slightly over the following several years, and by 2020 (and for all subsequent years), the federal government will pay 90 percent of the costs of covering these individuals. According to CBO, between 2014 and 2022, the federal government will pay $931 billion of the cost of the Medicaid expansion, while states will pay roughly $73 billion, or 7 percent.”
States that challenged the law argued that it was coercive to require them to either expand Medicaid or risk losing all Medicaid funding, a practical impossibility given the size of the program in most states. The court ruled that while it was constitutional for Congress to offer states money to expand Medicaid, it could not take away funding for their existing program if they declined, according to SCOTUSblog.
According to the Urban Institute analysis, some heavily Republican states account for a large share of uninsured that could benefit from the Medicaid expansion. Expanding eligibility in Texas alone would provide coverage to 1.8 million additional people. Expanding Medicaid in Florida, as planned, would cover another 951,000 people.
After the court’s ruling, Republican governors said they hoped that Mitt Romney would be elected president in November and the law would be repealed.
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