To hear the arguments of attorneys for plaintiff states before the U.S. Supreme Court on Wednesday, the federal government will force state governments into unsustainable spending by requiring them to provide health care for an additional 17 million or so poor Americans. The states contend the law is thus coercive and unconstitutional, infringing on state sovereignty.
The Affordable Care Act aims to address for the long term a complex of shortcomings in the current health-care system. One of these is that some 50 million Americans this year have no health insurance. There are a few reasons why the number who are uninsured is high and rising. An important factor is that many among them are indigent, unable to afford the cost of coverage and care.
To ensure that as many as possible of the nationís poor receive care when they need it, Congress turned to Medicaid, a program created nearly a half-century ago to address precisely that issue: health care for the poor, the cost split between the federal and state governments. The new health-care law doesnít reinvent the wheel. It simply expands Medicaid eligibility to citizens with income up to 133 percent of the federal poverty level (about $15,000 for a single adult). Currently, the federal government pays for more than half of overall spending in Medicaid.
There is no question the public program eats up a sizable percentage of state budgets, the bills rising with enrollment when economies falter. The law recognized that reality. The feds assume the bulk of the expanded cost, nearly 93 percent of the bill for covering the newly eligible enrollees from 2014 through 2022. Hardly coercive.
Adding 17 million more Americans to Medicaid rolls during that period would represent a mere 2.8 percent increase in state Medicaid spending, according to an analysis by the Congressional Budget Office. Other studies indicate that trimming the ranks of the uninsured also would reduce billions of dollars in other costs, such as uncompensated care, that are borne directly and indirectly by state and local governments and institutions.
Medicaid is a voluntary program, which states can reject if they consider the federal strings coercive or too burdensome for participation. It is telling of the value attached to the safety-net program that no state has yet deemed it wise or defensible to walk away from it.