Affordable Care Act: Medicaid Expansion

Medicaid Expansion I.NFIB v. Sebelius: Constitutionality of Medicaid Expansion under the Affordable Care Act

Constitutionality of Expansion Supreme Court holds in NFIB v. Sebelius:  Medicaid expansion violates Congress’ spending power as unconstitutionally coercive of states because: 1.States not given adequate notice to voluntarily consent to expansion, and 2.HSS Secretary could potentially withhold all of a state’s existing federal Medicaid funds for non-compliance

Constitutionality of Expansion Medicaid Expansion is a “gun to the head” because the “threatened loss of over 10 percent of a state’s overall budget….is economic dragooning that leaves the states with no real option but to acquiesce.” - Sebelius, at 54.

Constitutionality of Expansion Coercive But Supreme Court fashions a “remedy” to overcome the coercion

Constitutionality of Expansion Supreme Court’s remedy for coercion:  Remedy is to limit HHS Secretary’s power to withhold existing federal Medicaid funds for state non- compliance with Medicaid expansion  Makes Medicaid expansion optional for states

Supreme Court on ACA’s Medicaid Expansion IssueVoteSupportOppose The ACA’s Medicaid Expansion is Unconstitutionally Coercive 7:2Roberts, Breyer, Kagan, Scalia, Kennedy, Thomas, Alito Ginsburg, Sotomayor The Secretary’s enforcement authority should be limited 5:4Roberts, Breyer, Kagan, Ginsburg, Sotomayor N/A The entire ACA should be invalidated 4:5Scalia, Kennedy, Thomas, Alito Roberts, Breyer, Kagan, Ginsburg, Sotomayor

Medicaid Expansion I.NFIB v. Sebelius: Constitutionality of Medicaid Expansion under the Affordable Care Act II.Past, Present, and Future: A glimpse at Medicaid Establishment and Expansion

Past: Establishment of Medicaid

Past: Medicaid Establishment Establishment of Medicaid  Established in 1965 as a jointly funded cooperative between federal and state governments  Purpose: Provide medical benefits to those who have either no or inadequate medical insurance  Program requirements: Established by each state and eligibility varies per state

Past: Medicaid Establishment Tennessee’s Response to Medicaid Enactment  Established TennCare in 1994  Serves roughly 18-19% of the state’s population  Two types of TennCare: TennCare Medicaid and TennCare Standard

Past: Medicaid Establishment For:  Tennesseans who are eligible for Medicaid  Groups covered include: Children under 21, pregnant women, single parents of minor child, elderly, and disabled  Income limits are applicable For:  Children under 19 who are already enrolled in TennCare Medicaid AND  Lack access to group health insurance OR  Time of eligibility for TennCare Medicaid is ending and they no longer qualify TennCare MedicaidTennCare Standard

Present: Tennessee without Medicaid Expansion

Current source of Tennesseans HealthCare coverage LocationEmployerIndividualMedicaidMedicareOther Public Uninsured Total TN47%5%18%14%2%14%100%

Present: Tennessee without Medicaid Expansion Tennessee Compared to United States

Future: Medicaid Expansion  Affordable Care Act gives states the option to expand Medicaid coverage to nonelderly adults with incomes up to 138% of the federal poverty level (FPL)

Future: Medicaid Expansion

 Means that Tennessee can extend TennCare coverage to individuals up to 138% FPL Persons in household Poverty Guideline 133%138%400% 1$11,490$15,282$15,856$45,960 2$15,510$20,628$21,404$62,040 3$19,530$25,975$26,952$78,120 4$23,550$31,322$32,500$94,200

Future: Medicaid Expansion  No deadline by which states must decide whether to expand or not  No partial expansion- all or nothing  Effects of expansion

Future: Medicaid Expansion Effects of Expansion  Effect on people below 100% FPL

Future: Medicaid Expansion Effects of Expansion

Future: Medicaid Expansion Effects of Expansion  Effect on people below 100% FPL  Financial Effects of Expansion

Financial Effects of Expansion  100% for first three years (2014, 2015, 2016)  95% in 2017  94% in 2018  93% in 2019  90% thereafter  Approx. $31 million in 2017  Approx. $95 million in 2019 Federal Government will payTennessee’s Increased Costs

Future: Medicaid Expansion Effects of Expansion  Effect on people below 100% FPL  Financial Effects of Expansion  Effects of the Eligible but not Enrolled (EBNE)

Effects of the EBNE  Individuals who are currently eligible for Medicaid but not enrolled will likely go to exchanges and be automatically moved to TennCare  State will pay approximately 35% of the cost of covering this group  “Woodwork effect”  May be over 60,000 EBNE individuals who enroll in TennCare

Future: Medicaid Expansion Effects of Expansion  Effect on people below 100% FPL  Financial Effects of Expansion  Effects of the Eligible but not Enrolled (EBNE)  Effects on healthcare availability

Effects on Healthcare Availability  More than 220,000 (and possibly up to 370,000) additional Tennesseans who are not currently eligible for TennCare would become eligible if expanded  Expansion would result in 24.7% reduction in overall number of uninsured in Tennessee

Where do States stand on Expansion? Future: Medicaid Expansion

Where do states stand?

Medicaid Expansion?