Fortunately, our assessment of Douglas was not correct. By a narrow 5-4 margin, the Supreme Court decided to put off until another day a complex legal issue that could render much of our Medicaid law unenforceable.
As we explained last October, Medicaid is the largest example of a federal/state partnership where the state agrees to set up a program to help its citizens and the feds agree to put up much of the money necessary to keep this program running. When a state agrees to participate in Medicaid, they must also agree to comply with the network of federal laws governing the Medicaid program, including a requirement that the state’s Medicaid program pays health providers enough to “ensure that enough providers will participate in the Medicaid program so that patients will have meaningful health care access.”
Beginning about a decade ago, however, the Court began making it harder for these laws to actually be enforced. Under this new line of cases, it became harder and harder for private individuals to actually enforce Medicaid and similar laws — only an action by the federal government itself could be used to ensure that states comply with the law. Douglas threatened to complete this process, making much of the law largely unenforceable by the people it is intended to protect.
The Court’s four conservatives joined a dissent indicating that they are ready to do exactly that. Justice Anthony Kennedy, however, broke with his fellow conservatives to punt this question until another day — ordering a lower court to consider whether a recent decision by a federal agency makes deciding the issue in the Douglas case unnecessary. In other words, today’s decision is largely a nothingburger.
Should the Court eventually adopt the dissenting justices’ view, the result would be that the availability of programs like Medicaid could swing wildly depending on who is in the White House. As we wrote in October:
[T]he short term effect will be that only the Obama Administration will have the power to enforce key provisions of the Medicaid law — and patients and health providers will just have to trust that Obama’s team does an adequate job of enforcing the law. That may not seem so bad, but what happens if the Obama Administration gets replaced with the Perry Administration or the Palin Administration or the Ryan Administration or some other administration that is actively hostile to enforcing the Medicaid laws? If a future Administration shows no interest in enforcing the Medicaid statute, then entire provisions of law could effectively cease to exist until a more progressive president is elected.
Hopefully, today’s surprising vote by Justice Kennedy to punt this case means that he is not prepared to turn this prediction into a reality.