Ironically, the GOP proposal to repeal the ACA in the name
of returning authority over health care to the states has some potentially
serious constitutional issues on federalism grounds. Here are some preliminary
thoughts on the matter, with the caveat that conclusions may change as we get
more details.
The most
obvious potential federalism problem in the bill is the so-called “Buffalo Bribe,” an amendment
introduced earlier this week in an effort to eek out a few more GOP votes for
the bill from upstate New York Republicans. That amendment intrudes on one of
the most traditional state functions of all-- the internal revenue raising and
taxing provisions of a state. It provides that New York can no longer ask
counties to pay a share of its Medicaid bill, as New York has done for more than
fifty years pursuant to state law. Instead, the bill provides
that the state alone has to cut the full check. (The county share is currently a
little over $ 2 billion.)
This
amendment is likely unconstitutional. The protection
from federal interference of the internal functions of a state governments is one
of the bedrocks of state sovereignty protected by the limitations on Congress’s
powers in Article I of the Constitution and the reservation of power to the
states in the Tenth Amendment. Even if one could argue that this is an
exercise of the federal spending power under Article I, for Congress to legally
use that power, the conditions on a state’s use of federal funding have to be
tied to a reasonable federal purpose.
Governor Cuomo has made clear he will most likely have to raise taxes
steeply to cover the gap the bill would cause (which also means that the upstate
taxpayers who Reps. Faso and Collins, the sponsors, are trying to protect
are not even going to benefit). It is
hard to see a reasonable federal purpose here other than garnering more GOP votes
for the struggling repeal bill.
If, on
the other hand, Governor Cuomo decides not to raise the money, and to close
hospitals and make other dramatic cuts to other programs New York State instead (which seems to be what Faso and Collins want), then we may be getting into the
realm of a different kind of constitutional problem, namely unconstitutional
coercion. It would violate the Spending Clause
and the Tenth Amendment’s protection of state sovereignty if the
amendment is a “Godfather offer” - an offer the state can’t refuse. Of course, the irony here is that it is the
Republicans who are responsible for the expansion of this same coercion
doctrine that makes this kind of argument credible. It’s the argument they used
to successfully attack the ACA’s original Medicaid expansion in the
constitutional challenge they filed almost exactly seven years ago, NFIB v.
Sebelius.
What’s more, it is my understanding
that other states also have similar requirements that split Medicaid costs with
localities. If that’s the case, the constitutional problems with the Buffalo
Bribe are potentially even more serious, because on what rationale does it make
sense to penalize only New York for this arrangement? This kind of arbitrary discrimination against
New York also makes clearer the absence of a rational federal purpose for the
amendment.
And here's a different way to put it: Faso and Collins are trying to use federal law to change state law in a way they wish they could, but can't get through in Albany. If they want New York to change its state law on how Medicaid checks get written, they should go through New York government.
This
amendment may not be the only part of the repeal bill that raises
constitutional problems. States are
still investigating the effects of the more generally proposed Medicaid
amendments, and time will tell if any legal issues arise. But just last night, the GOP offered a few
additional amendments, in an effort to
squeeze out the last few votes. One of
those amendments appears to require states to provide a definition of the “essential health
benefits” that covered insurance plans must include. This amendment appears to be an intra-GOP
compromise: Conservatives wanted EHBs eliminated entirely from the ACA,
moderates didn’t. Returning “power” to
define federal requirements to the states is page 1 in the playbook of “federalism”
compromises.
The EHB
provision may be a drafting error. It
does not make clear what the states get in return for defining the EHBs,
whether they have a choice to do so, or what happens if they don’t. EHBs can be extremely controversial as a
political matter (just look at the nasty headlines yesterday that resulted when
Congressman Pat Roberts quipped about cutting mammography coverage), and states
may not be thrilled about this new obligation.
Is it an order from the federal government? If so, it could be another
unconstitutional effort to commandeer the states to do the federal government’s
bidding. If so, this too would violate the Tenth Amendment.
So far,
the AHCA is not shaping up to the federalism friendly legislation it has promised. Instead, the GOP is clearly more concerned about getting a repeal--any repeal--through, than about getting it right. More as more develops.