Medicaid Expansion Will to Rise 13 Percent by 2017
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The Fiscal Times
April 3, 2012

Justice Stephen Breyer seemed unsure of his facts last week.

During oral arguments on the constitutionality of health care reform, he suggested that the law’s Medicaid expansion, which will offer government coverage to about 15 million low-wage workers and their families, was smaller than previous expansions – notably, the change of the late 1980s and early 1990s, which brought all poor children under Medicaid’s umbrella; and one enacted in the late 1990s and early 2000s that included children up to 200 percent of the poverty level.

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“The expansion from 0 to 18 or even 0 to 6 . . . it’s pretty hard to argue that they aren’t roughly comparable as a percentage of the prior program or as a percentage of GDP (gross domestic product),” he said to Paul Clement, the eloquent litigator who represented the 26 states challenging the Medicaid expansion as unconstitutional coercion of the states. “If I’m right on those numbers, or even roughly right – I don’t guarantee them – then wouldn’t you have to say, well, indeed, Medicaid has been unconstitutional since 1964?”

Three things made the proposed expansion under Obamacare unique, Clement replied in his rebuttal. “One is the sheer size,” he began. “Two is the fact that this statute uniquely is tied to an individual mandate, which is decidedly non-voluntary. And three is the fact that they’ve leveraged the prior participation in the program.”

If the high court rules the individual mandate is unconstitutional, it’s highly unlikely they would expand that ruling to include Medicaid’s expansion. The joint federal-state program is financed by taxes. So unlike the economics of insurance regulations, Medicaid does not require a mandate to be sustainable. All the government has to do is raise taxes.

spent 25 years as a foreign correspondent, economics writer and investigative business reporter for the Chicago Tribune and other publications. He is the author of the 2004 book, The $800 Million Pill: The Truth Behind the Cost of New Drugs.