SCOTUS, the Affordable Care Act, and an ugly American tradition

I thought I had exhausted my need to read or listen to anything more on the Supreme Court decision on the Affordable Care Act (ACA). I read something today, however, that made me realize I hadn’t been paying close enough attention. It was an article published by The New England Journal of Medicine called The Road Ahead for the Affordable Care Act

The author, John McDonough, points out the significance of the upcoming November elections. In particular, he clarified for me why recent mentions of ‘reconciliation’ are not just referring to how the ACA was passed in 2010.

In January 2013, if Democrats hold the White House and Senate and regain control of the House, the ACA will be implemented mostly as constructed. If Republicans capture the White House and Senate and retain House control, the ACA will face major deconstruction early in 2013. Republican leaders will attempt to use Congress‘s budget-reconciliation authority to enact extensive repeal — and will need only 51 Senate votes, with no filibuster threat. If control of the White House and Congress is divided between the parties, then conflict over the law will persist. Thus, the November elections increasingly feel like a referendum on the ACA.

During this Fourth of July week we’ve had much flim-flam on the Court’s decision from the Romney campaign: “The mandate is a penalty.” “No, it’s a tax.” “The exact same mandate is not a tax in Massachusetts, however.”

There are reasons, then, why health care might not become a campaign issue for this particular Republican presidential nominee. And if it does not, I wonder if those in favor of universal health care realize how easily we could lose this historic achievement.

The subtleties of Medicaid

The Medicaid issue is a bit more nuanced than I’d been paying attention to. Currently Medicaid does not cover all legal residents with incomes below the federal poverty level. Forty-five states, for example, do not include adults who have no dependent children. The 2011 poverty guideline recommended by the Department of Health and Human Services was $10,890 for an individual in most states (that’s annual income and the cut off increases with family size). Although states are required to cover poor children, whether their parents are covered varies by state. According to the Los Angeles Times: “As of 2009, 17 states only covered working parents who made less than half the federal poverty line, or $5,415.” In Arkansas a working parent must earn less than $1,841 to qualify for Medicaid. It’s hard to imagine buying much of anything, let alone health insurance, on an annual income of $1,841.

The intent of the ACA was to expand Medicaid coverage in two ways: It would increase the income cut off to 138% of the poverty line and it would be available to everyone in that income category, including those not previously covered.

The Supreme Court ruling allows states to refuse this expanded coverage and to continue with their previous Medicaid rules. Residents in such states with an income between 100 and 138% of the poverty level would be eligible to obtain health coverage through insurance exchanges. Those below the federal poverty level, however, would not. As McDonough writes, the Supreme Court decision

creates a new inequity in the health system: by 2014, all Americans will have guaranteed access to affordable health insurance except adults with incomes below the poverty level who were previously ineligible for Medicaid.

McDonough also clarifies an aspect of the financial motivation behind opposition to the individual mandate. Currently there are individuals who are eligible for Medicaid, but who have not signed up. Governors of conservative states fear that the mandate will induce those individuals to apply for Medicaid. This will increase state expenses (the federal government pays matching funds of 50 to 83% of the cost of Medicaid, leaving states with the remaining 17 to 50%). “Disagreement over how many such people will enroll helps to explain the wide divergence in estimates of the costs to states of expanding Medicaid,” writes McDonough.

The ugly tradition

In looking over some of my previous posts on health care reform, I came across the following comment on opposition to the individual mandate. It addresses an underlying issue that explains why it has been so difficult to achieve universal health care in the US. Written by David Cole, it was published in February, 2011 following a ruling against the individual mandate by Virginia federal judge Henry Hudson. (emphasis added)

The roots of the ideological divide, moreover, run deep. The principal constitutional issue at stake—the extent of Congress’s authority to pass laws governing Americans’ lives—has separated conservatives and liberals since the beginning of the Republic. “States’ rights” was the South’s rallying cry in its effort to retain slavery before the Civil War, and to defend racial segregation from federal intervention thereafter. From the turn of the century through the early years of the New Deal, conservatives successfully invoked “states’ rights” to interpret Congress’s power over interstate commerce narrowly and thereby invalidate progressive federal laws designed to protect workers and consumers from big business. …

Opposition to health care reform is ultimately not rooted in a conception of state versus federal power. It’s founded instead on an individualistic, libertarian objection to a governmental program that imposes a collective solution to a social problem. While Judge [Henry] Hudson’s reliance on a distinction between activity and inactivity makes little sense from the standpoint of federal versus state power, it intuitively appeals to the libertarian’s desire to be left alone. But nothing in the Constitution even remotely guarantees a right to be a free rider and to shift the costs of one’s health care to others. So rather than directly claim such a right, the law’s opponents resort to states’ rights.

In this respect, Judge Hudson and the Virginia attorney-general are situated squarely within a tradition—but it’s an ugly tradition. Proponents of slavery and segregation, and opponents of progressive labor and consumer laws, similarly invoked states’ rights not because they cared about the rights of states, but as an instrumental legal cover for what they really sought to defend—the rights to own slaves, to subordinate African-Americans, and to exploit workers and consumers.

Here, too, opponents of health care reform are not really seeking to vindicate the power of states to regulate health care. Rather, they are counting on the fact that if they succeed with this legal gambit, the powerful interests arrayed against health care reform—the insurance industry, doctors, and drug companies—will easily overwhelm any efforts at meaningful reform in most states. Unless the Supreme Court is willing to rewrite hundreds of years of jurisprudence, however, they will not succeed.

Back in the swing?

I started writing this blog in October of 2008, a month before President Obama was elected. I hadn’t anticipated writing about health care reform, but it was soon hard to avoid.

I’ve been on a self-described ‘sabbatical’ from blogging for the past year. In the next post, I explain why I may be ready to start writing again. Although I don’t plan to write about the politics of health care, my reasons for resuming are inspired by the issues of health care reform: a desire for collective solutions to social problems and the elimination of an ugly tradition that affects not only health care, but health itself.

Resources:

John E. McDonough, The Road Ahead for the Affordable Care Act, The New England Journal of Medicine, July 2, 2012

Noam N. Levey, Court’s decision could widen Medicaid gap, Los Angeles Times, June 29, 2012

David Cole, Is Health Care Reform Unconstitutional?, The New York Review of Books, February 24, 2011

Update 7/9/12: More on Medicaid

There’s something I neglected to mention about the Supreme Court’s decision with respect to Medicaid. The provisions of the ACA stipulated that if a state refused to expand Medicaid (generously funded by the federal government), it would lose its Medicaid funding. The Supreme Court ruled that this was too coercive and that states could retain their current Medicaid funding even if they refused to expand it.

Texas governor Rick Perry announced today that Texas would reject the expanded Medicaid program. Texas has 6.2 million uninsured residents, almost a quarter of its population.

Another nuance, highlighted in a Forbes article today: Another provision of the ACA was that states must not reduce their Medicaid eligibility rules (some states have eligibility levels that are “well above federal minimums”). If they did, they would lose their Medicaid funding from the federal government. This was struck down by the court.

Yet another provision of the ACA (it’s a big document) requires states to set up health insurance exchanges. If they do not, the federal government will create one for them. Governor Perry also announced today that Texas would not set up a state insurance exchange.

In states like Texas that reject both Medicaid expansion and state exchanges, residents who lose their Medicaid coverage will be eligible for insurance through the new federally funded exchanges. The Forbes article describes the financial implications of this for insurance companies (bad for Medicaid health plans) and the pharmaceutical industry (good because exchanges will pay more). But there’s another angle. Getting more people covered by federal health exchanges is (it seems to me) a back door to universal coverage/single-payer/Medicare for all. That would be a very good thing indeed.

Update 7/11/12

A very satisfying editorial from the Post’s Matt Miller:

GOP to the uninsured: Drop dead (Washington Post)

The Republican message to uninsured Americans in the wake of the Supreme Court’s recent ruling couldn’t be clearer: You’re on your own. … The party may not have officially adopted the “let him die” policy of right-wing hecklers at that CNN primary debate, when Ron Paul was asked what should be done when an uninsured man shows up at the hospital. But as a practical matter, Republicans are in pretty unsavory territory. What other conclusion can we draw when Rick Perry, who presides over a state where one in four people lack health coverage, makes swaggering indifference to these Texans’ plight a point of sovereign pride? …

Only in America could a Democratic president pass Mitt Romney’s health plan and fund it partly through John McCain’s best idea from the last campaign (taxing some employer-provided plans) and be branded a “socialist.”

Miller goes on to point out that there are more uninsured Americans than the combined populations of 25 states.