The U.S. Supreme Court on Wednesday considered whether upholding the expansion of the Medicaid program in the Patient Protection and Affordable Care Act would give the federal government limitless powers to impose conditions on the states when they accept money in other areas, such as education.
The Medicaid question was the last one to be tackled by the justices in three historic days of arguments over the health-reform law championed by President Barack Obama. The court is also weighing the constitutionality of the individual mandate, which would require most uninsured Americans to obtain coverage or pay a penalty, and whether the rest of the law could survive if that provision were invalidated.
The briefs and arguments in Florida v. Department of Health and Human Services (Case No. 11-400) also touched on the Elementary and Secondary Education Act, Title IX’s prohibition against sex discrimination in education, and related ideas as the justices weighed the scope of the authority of Congress to set conditions for the states when they accept federal funds.
The health-reform law calls for Medicaid to expand to cover any adult with income below 138 percent of the federal poverty line, not counting the elderly, who are covered by Medicare. This new group, which would cover many childless adults under Medicaid for the first time, would likely receive less comprehensive benefits than traditional Medicaid recipients. The federal government would initially cover 100 percent of the costs, though that will eventually decrease to 90 percent.
A group of 26 states, lead by Florida, challenged what their lawyer, Paul W. Clement, called a “massive expansion” of Medicaid law that was unconstitutionally coercive.
“There has to be some limit on coercion,” Clement said during the arguments. “This court’s entire spending power jurisprudence is premised on the notion that ... Congress can do things pursuant to the spending power that it can’t do pursuant to its other enumerated powers precisely because the programs are voluntary.”
The Obama administration argues in its brief in the Medicaid case that the challenging states’ theory would lead to legal challenges of other federal spending programs as too coercive.
The administration noted that Florida, the state leading the challenge, in 2008 received $728 million in federal Title I aid under the Elementary and Secondary Education Act. In exchange for such funds, Florida and other recipients must comply with federal laws such as Title VI of the Civil Rights Act of 1964, which bars race discrimination in federal education programs, and Title IX of the Education Amendments of 1972, which bars discrimination based on sex.
The challenging states “observe that federal Medicaid grants are generally larger than other federal grants, but offer no principled basis for deciding whether other grants, too, might be large enough that the Constitution would require invalidation of the conditions Congress has attached to them,” the administration said in the brief.
In court on Wednesday, Justice Samuel A. Alito Jr. offered U.S. Solicitor General Donald B. Verrilli Jr., who was defending the Medicaid expansion, a hypothetical with echoes of the administration’s Race to the Top program, which requires states to adhere to certain school overhaul priorities as a condition of receiving education grants. (Though Alito’s notion of a federal education tax goes well beyond anything in current federal programs.)
“Let’s say Congress says this to the states: We have got great news for you; we know your expenditures on education are a huge financial burden, so we are going to take that completely off your shoulders,” Justice Alito said. “We are going to impose a special federal education tax which will raise exactly the same amount of money as all of the states now spend on education; and then we are going to give you a grant that is equal to what you spent on education last year.”
“Now, this is a great offer and we think you will take it,” Alito continued. “But of course, if you take it, it’s going to have some conditions because we are going to set rules on teacher tenure, on collective bargaining, on curriculum, on textbooks, class size, school calendar and many other things. So take it or leave it.”
The states could say no, but they would have to pay the federal education tax, plus come up with their own money to replace the federal education dollars they decline, Alito added.
“Would that be the point where financial inducement turns into coercion?” Alito said.
Verrilli said no because the states would still have the choice of whether to participate in such a program. And the program described by Alito was politically unlikely, he added.
“The states have their education system, and they can decide whether they are going to go in or not,” Verrilli said.
Earlier in the argument, Justice Ruth Bader Ginsburg asked Clement, the lawyer for the 26 states challenging the Medicaid program, whether Title IX’s application to colleges and universities was coercive.
“Most colleges and universities are heavily dependent on the government to fund their research programs and other things,” Justice Ginsburg said. “And that has been going on for a long time. And then Title IX passes, and a government official comes around and says to the colleges, you want money for your physics labs and all the other things you get it for, then you have to create an athletic program for girls. And the recipient says, I am being coerced, there is no way in the world I can give up all the funds to run all these labs that we have, I can’t give it up, so I’m being coerced to accept this program that I don’t want.”
“Why doesn’t your theory, if your theory is any good, why doesn’t it work any time someone receives something that is too good to give up?” Ginsburg said.
Clement said coercion was present only when Congress tries to do something through its Article I spending power that it could not do directly, and it is possible in theory that Congress could impose Title IX’s anti-discrimination protections under the 14th Amendment.
Ginsburg pointed out that the Supreme Court has never struck down a spending clause program as too coercive.
“I know that there are cases of ours that have said there is a line between pressure and coercion, but we have never had, in the history of this country or the court, any federal program struck down because it was so good that it becomes coercive to be in it.”
The court’s liberals were not inclined to make the Medicaid expansion the first such program, and while the court’s conservatives were harder to read, there seemed to be no overwhelming support for the states’ challenge among them, either.
The case, along with the others involving the health-care law, is expected to be decided by the end of the court’s term in late June.
A version of this news article first appeared in The School Law Blog.