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Wednesday, July 4, 2012

SCOTUS: Congress Coercing States to Expand Medicaid

The aspect of the court’s decision on “Obamacare” that forbids Congress (and the President) from threatening states by withholding funds already promised is significant in terms of American federalism. In his dissent, Scalia notes the Court had never before “found a law enacted under the spending power to be coercive.” In the case then before the Court, all but two justices found “the conditional of a State’s continued receipt of all funds under a massive state-administered federal welfare program upon its acceptance of an expansion of that program” to be just that, and thus unconstitutional. The majority was doubtlessly acting to protect federalism from even more encroachment by the U.S. Government at the expense of the sovereignty retained at least de jure by the state governments.

According to the precedent, while Congress can specify the purpose to which funds can be used by states, other funds already being received by the states cannot be held ransom. As a result, we can expect greater differences between the states in terms of government programs, including entitlement programs like Medicaid. Given the empire-scale of the American Union of fifty republics, such diversity is both natural and healthy. 

It is significant that in the case before the Court, twenty-six states were objecting to the Affordable Care Act. That the anticipated forced-expansion of Medicaid could have been onerous to the states may thus have weighed more heavily on the justices than did the burden of the mandate on individuals. By its decision, the Court gave those states some relief in being able to “just say no” to the expansion without having to lose existing Medicaid funds. In recognizing the states’ authority in this respect vis a vis that of the federal government, the justices evaded further political consolidation at the expense of federalism (and the sovereignty retained at least formally by the states). 

National Federation of Independent Business et al. v. Sebelius, Secretary of Health and Human Services, et al., 567 U.S. Supreme Court (2012).

Amanda Terkel, “GOP Governors Resist Implementing Obama’s Health Care Law DespiteSupreme Court Ruling,” The Huffington Post, June 29, 2012.