Supreme Court Upholds Key Provisions of PPACA

In a victory for the 26 states that filed suit against PPACA, the high court called unduly coercive the provision to allow the Secretary of Health and Human Services to cut all Medicaid funding for states that choose not to participate in the Medicaid expansion under the Act.

"The threatened loss of over 10% of a State's overall budget is economic dragooning that leaves the States with no real option but to acquiesce in the Medicaid expansion," Roberts wrote.

"The Government claims that the expansion is properly viewed as only a modification of the existing program, and that this modification is permissible because Congress reserved the 'right to alter, amend, or repeal any provision' of Medicaid. But the expansion accom­plishes a shift in kind, not merely degree."

"The original program was designed to cover medical services for particular categories of vulner­able individuals. Under the Affordable Care Act, Medicaid is trans­formed into a program to meet the healthcare needs of the entire nonelderly population with income below 133% of the poverty level. A State could hardly anticipate that Congress's reservation of the right to 'alter' or 'amend' the Medicaid program included the power to transform it so dramatically. The Medicaid expansion thus violates the Constitution by threatening States with the loss of their existing Medicaid funding if they decline to comply with the expansion."

HealthLeaders Media will continue reporting on the implications of the decision for healthcare leaders and their organizations.