While the media and the general public are busy focusing on the obviously unconstitutional individual mandate provision of Obamacare, there is a second provision of Obamacare that will be discussed today in oral arguments. This provision hasn’t garnered nearly the attention of its individual mandate cousin. But it’s just as unconstitutional, and significantly more underhanded.
One of the rules under Obamacare is known as the “Medicaid mandate.” The basic issue is that Obamacare attempts to usurp power from the states by forcing federal Medicaid decisions down their throat at the point of a knife.
Here’s how it works. Obamacare places new restrictions on Medicaid spending, requiring state spending to fill any gaps. If a state refuses to spend enough money to cover the restrictions, Obamacare allows the Department of Health and Human Services to cut off all Medicaid funds to the state. Because Medicaid spending has become such a large-budget item for most states (it’s usually the top percentage of the state budget), a federal cut-off of funding would destroy states financially. As Rob Natelson of Health Policy Solutions writes, “The state’s citizens would see billions they pay in federal taxes diverted to other states. Further, their own state officials would have to fund substitute health programs for the poor, paying for them with huge hikes in income, sales and property taxes.”
The question is whether the federal government can attach such strings to grants to states. The Supreme Court has generally suggested that turning states into agents of the federal government runs afoul of the Constitution – and this would clearly do that via the power of the federal funding baton. Even cases in which the feds have been allowed to coerce states by withholding funding did not allow the federal government to virtually bankrupt states by making them subject to certain laws, forcing them to cover the cost, and withdrawing federal grants if they don’t.
This is the second section of today’s arguments in the Court. If the Court finds – as it well may – that the law cannot be struck down piecemeal, but must be struck down or upheld as a whole, then this little-noticed issue could spell the death knell of the entire Obamacare law, regardless of how the Court rules on the individual mandate.