Alabama opposes Medicaid expansion

Published: Wednesday, March 28, 2012, 5:30 AM
Attorney General Luther StrangeAlabama Attorney General Luther Strange seen May 26, 2011. (The Huntsville Times/Robin Conn)

WASHINGTON -- Alabama, despite having one of the most bare-bones Medicaid programs in the country, is one of the 26 states arguing to the U.S. Supreme Court today that states shouldn't be forced to expand health coverage to more low-income residents.

Alabama Attorney General Luther Strange, who joined with the other mostly Republican attorneys general in challenging the Affordable Care Act, will be watching in the courtroom today when the justices consider whether the provision to grow Medicaid programs in the states is constitutional.

"There is a great concern in state government that this will lead to uncontrollable costs in Alabama's Medicaid program," Strange said Tuesday in an interview across the street from the U.S. Supreme Court building. "It hasn't been the focus of the arguments, but it's been a big concern."

The federal health care law signed by President Barack Obama in 2010 calls for a broad expansion of state Medicaid programs, which are health insurance systems primarily for lower-income children, pregnant women and the disabled that are paid for with a combination of state and federal funds.

The new law would expand the number of people who are eligible to receive Medicaid benefits, which likely would add lower-income adults who aren't old enough to be on Medicare and don't have any dependent children. In Alabama, one estimate is that it would add 534,000 people to the program, which already serves about 1 million in a state with a population of about 4.8 million.

Strange and the other state attorneys general argue the forced expansion amounts to coercion.

"Congress easily could have designed an act that encouraged rather than forced states to expand their Medicaid programs," according to written arguments submitted by the states. "By making a conscious decision to deprive states of any choice in the matter, Congress has effectively forced this court's hand."

Medicaid in Alabama is a $6 billion-a-year program and provides mostly the minimum level of services needed to qualify for the federal matching money. More than two-thirds of the cost of Medicaid in the state is picked up by the federal government.

The health care law, however, dictates that the costs of the expansion be paid 100 percent by the federal government from 2014 to 2016. After that, the federal share would drop to 90 percent by 2020, where it would remain.

The Obama administration argues that is an especially generous arrangement for the states, which on average have 57 percent of their costs paid by Washington. And Medicaid is voluntary, meaning states can choose not to participate at all.

"(The states') claim of coercion is nothing more than an argument that the citizens of their states would hold them politically responsible for either the reduction in benefits that would result from opting out of Medicaid or for the increased taxation needed to fund those benefits entirely at the state level," according to the federal government's brief.

Strange said he didn't trust promises of federal funding for the expansion.

"The government tells you they're going to pay for it, but they can always change what they cover or don't cover," Strange said. "There's no free lunch. Usually ... in the end, states have strings attached to that money and there are costs that we can't even anticipate right now."

State Sen. Roger Bedford, D-Russellville, was critical of Strange's legal position against the Medicaid expansion, and he called the 90-10 funding split a good investment for Alabama.

"He's obviously not familiar with the Medicaid needs in Alabama because we have one of the most sparse programs," said Bedford, minority leader in the state Senate.

Strange said that how states want to design their Medicaid programs is a policy question and that, as attorney general, he is only trying to set some limits on the power of the federal government.

Alabama also joined the challenge of the other part of the federal health care law that mandates all individuals carry health insurance.

The justices will finish a third day of arguments on the law today and a ruling is expected later this summer.

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