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Health reform ruling leaves Medicaid question mark
July 3rd, 2012
WASHINGTON – The U.S. Supreme Court's complex decision to preserve the core components of the Affordable Care Act (ACA) health care reform law could impact community pharmacies that fill prescriptions covered by Medicaid.
Although the High Court upheld the most controversial part of the law — the "individual mandate" requiring most Americans to buy health insurance or pay a penalty — it determined that states didn't have to expand Medicaid eligibility, as Congress had intended.
The court ruled that the ACA's expansion of Medicaid eligibility requirements was constitutional but not its stipulation that the federal government can deny states all Medicaid funding if they don't comply. If states decide not to accept the expanded eligibility, they can continue to receive funds for the rest of the Medicaid program, just not the new funding under the act.
That portion of the historic decision leaves a big question mark over the law's mechanism for providing health care and pharmacy benefits to 17 million of the nation's poorest people.
Under the law, starting in 2014, more than 30 million Americans previously lacking health insurance coverage will be able to purchase health plans (or receive subsidies to buy plans) via newly created insurance exchanges set up by states, or receive health coverage via the broader Medicaid eligibility requirements.
Republican officials in over a half-dozen states have said they oppose or have serious doubts about expanding Medicaid, even though the federal government would pick up all the costs in the first few years and at least 90% of the expenses after that.
When writing the health reform law three years ago, federal lawmakers assumed that the poorest of the uninsured would gain coverage through Medicaid, while many people with higher incomes would receive federal subsidies to buy private insurance.
However, the Supreme Court's ruling that states do not have to opt into the Medicaid expansion program could leave poor people living in a state that refuses to expand its Medicaid program with nowhere to turn — unable to obtain either Medicaid or subsidies.
Some state lawmakers, many already facing mounting budget deficits, say adding thousands of patients to their Medicaid rolls will only add to their economic woes.
The Republican governors of Kansas, Nebraska and South Carolina and a handful of other states have already said they would have difficulty affording even the comparatively small share of costs that states would eventually have to pay.
Under the Medicaid expansion plan, the federal government would initially pay all of the cost of expanding the program to 133% of the poverty level. The state share would slowly rise to 10% of the cost by 2020.
"As I have said repeatedly, if this unfunded Medicaid expansion is implemented, state aid to education and funding for the University of Nebraska will be cut or taxes will be increased," stated Nebraska Gov. Dave Heineman.
Others said they oppose the Medicaid expansion plan because they feel that it's the wrong approach to getting more Americans insured.
"We're not going to shove more South Carolinians into a broken system that further ties our hands when we know the best way to find South Carolina solutions for South Carolina health problems is through the flexibility that block grants provide,” said a spokesman for South Caronlina Gov. Nikki Haley.