Saturday, March 18, 2017

The Tragedy of the Medicaid Expansion (Part III)

Stephen Griffin

As far as I can tell, legal treatises and casebook chapters on federalism do not discuss race and my colleagues interested in critical race theory tell me not much is said in that literature about federalism.  That seems a shame, for they are surely connected in American constitutional history.  There are reasons, of course, relating to the nature of the Supreme Court’s federalism jurisprudence, with its somewhat narrow doctrines of “commandeering” and so on.  But it is still unfortunate because it did not prepare constitutional scholars for what I have described in my earlier two posts as the sectional and racial aftermath of Sebelius as well as voting rights cases such as Shelby County.  The rationales the Court advanced in these cases crossed an important line – in fact, a color line – and so opened the door to a racial past that many had thought closed.  As Joseph Fishkin points out with respect to Shelby County, the legacies of the Civil War and Reconstruction are still with us when the Court uses doctrines such as the “equal dignity” of states.  Once again, race and federalism are connected.

With respect to health care, Paul Starr provides a reminder of the sectional reality that existed prior to the ACA in his book Remedy and Reaction: “The United States developed out of radically different social systems in the South and the North, and while the South invoked states’ rights in defending slavery and later Jim Crow, federal intervention was crucial in efforts to achieve equality from the Emancipation Proclamation to the civil rights movement.  Even now, in economic and social policy, states in the South (and Southwest) show the influence of their traditions.  Compared with the rest of the country, they continue to provide the least support for the living standards, including the health care, of their low-income population.  In Louisiana, for example, unemployed parents have had to earn less than $2,400 (11 percent of the federal poverty line) to qualify for Medicaid.  In practice, therefore, turning health policy entirely over to the states means denying access to medical care and insurance protection for millions of the poor and near-poor in the South and Southwest.”  This was a telling preview of the impact of the Medicaid opt-out created by Sebelius.

For now, note Starr’s reference to the “traditions” of the South.  Those traditions became newly relevant when Chief Justice Roberts created the option for states to reject the Medicaid expansion.  This led to the tragedy of every southern state save Arkansas rejecting the expansion (Louisiana adopted the expansion in 2016).  This outcome was surely connected with the South’s history.

Historians have detailed how slavery had pervasive effects, not only on southern society, but its modes of governance.  In his history of the early republic, for example, Gordon Wood comments: “[s]lavery even perversely affected the tax system and other public policies in the South.  The Southern legislatures taxed their citizens much less heavily and spent much less on education and social services than did the legislatures of the North.”  In light of the realities I have reviewed with respect to Medicaid since 1965, this should sound familiar.  Matters did not improve after the Civil War and Reconstruction.  The white “redeemer” governments that took over had few resources and slashed state budgets.  According to C. Vann Woodward, this left little for public education, public health, and aid-dependent people such as the insane and the blind.  All of the facilities that might have helped these groups wound up in “a primitive state.”  As a consequence the South entered the twentieth century without a robust system of public education or public health.

The consequences of Sebelius relate strongly to this earlier history.  A 2013 NYT story quoted H. Jack Geiger, a founder of the community health center model: “The irony is that these states that are rejecting Medicaid expansion — many of them Southern — are the very places where the concentration of poverty and lack of health insurance are the most acute . . . It is their populations that have the highest burden of illness and costs to the entire health care system.”  Anyone thinking that the connection between federalism and race in the South was in the past should have received a wake-up call after Hurricane Katrina hit the Gulf Coast in 2005.  As Gary Rivlin’s book Katrina recounts in detail, the aftermath of the storm featured multiple and seemingly unrelenting episodes of racism, racial intolerance, and official decision making related to race that disadvantaged African Americans.

Consider the relevance of judicial doctrine in creating this situation.  New Deal decisions such as Carolene Products are often described as embodying a doctrine of deference to the determination of national policy by the political branches.  I suggest they are actually double-edged.  The other edge is a warning, however implicit, that a lack of deference in cases concerning the limits of the enumerated powers would lead inevitably to the Court creating its own policies.  So it proved with Sebelius, in which the Court materially modified the ACA, transforming it into something Congress never anticipated.  Although he lacked relevant expertise, Roberts somehow knew that childless adults could not be among the “neediest” among us.  But even if there was a kernel of a valid point to be made about the changes the ACA made to Medicaid, Roberts and the Court ignored the consequences of the vast differences in the way the states had implemented Medicaid.  Those differences pretty much came down to the reality that southern states always had lower eligibility standards – standards often well under the federal poverty level – which hurt their poor citizens, especially African Americans.  The ACA solved this problem with respect to parents and childless adults.  But the Court permitted the states to reinstate inequality.

I see this as perhaps the central challenge for our federal structure going forward, something you won’t read about in casebooks.  Many believe that inequalities unrelieved by economic growth are important policy problems.  But Sebelius and episodes like Hurricane Katrina exposed the problem of inequality among the several states.  Put bluntly, some states cannot take care of themselves.  They labor under crippling handicaps and need help, sometimes even intensive care.  They cannot cope alone with overwhelming problems of poverty, poor educational systems, medical neglect, and rural isolation.  They need national assistance and the Supreme Court should not be in the business of standing in the way.  That’s the true tragedy of Sebelius.

Works Cited:
Gary Rivlin, Katrina: After the Flood (2015)
Shanna Rose, Financing Medicaid: Federalism and the Growth of America’s Health Care Safety Net (2013)   
Paul Starr, Remedy and Reaction: The Peculiar American Struggle over Health Care Reform (2011)
Frank J. Thompson, Medicaid Politics: Federalism, Policy Durability, and Health Reform (2012)
Gordon S. Wood, Empire of Liberty (2009)
C. Vann Woodward, Origins of the New South (1951)

Mark A. Hall, States’ Decisions Not to Expand Medicaid, 92 N.C. L. Rev. 1459 (2014)
Nicole Huberfeld, Elizabeth Weeks Leonard, and Kevin Outterson, Plunging into Endless Difficulties: Medicaid and Coercion in National Federation of Independent Business v. Sebelius, 93 B.U.L. Rev. 1 (2013)
Elizabeth Weeks Leonard, Crafting a Narrative for the Red State Option, 102 Ky. L.J. 381 (2013-14)

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