Perspective:

The Supreme Court recently promised to review not only individual mandate to obtain health insurance, but also the issue of whether the Affordable Care Act (ACA)’s Medicaid expansion violates the US Constitution. The ACA requires that state Medicaid plans, starting in 2014, cover all persons less than 65 years of age with individual or family incomes up to 133% of the federal poverty level. This requirement represents a significant change since Medicaid had not previously set a baseline income level for mandatory eligibility for adults. To remain eligible for any federal Medicaid matching funds, states must accept these new requirements. Moreover, state participation in traditional Medicaid will no longer be possible, since the current terms and conditions of federal support will cease to apply in 2014. By granting review of it and explicitly allocating it an hour of argument, the Supreme Court has signaled that it takes the matter seriously. Should the expansion be struck down, as a constitutional matter there is nothing to prevent Congress from declaring that Medicaid as we know it has ended and enacting ‘Medicaid 2.0,’ including the expansion provisions, and leaving states free to decide whether to sign up. However, in practice, such a move could prove to be politically unpopular, and would be unlikely to gain traction in Congress.