Obamacare: Why Are GOP Governors Caving On Medicaid Expansion?


After stating last July that "Florida will opt out of spending approximately $1.9 billion more taxpayer dollars required to implement a massive entitlement expansion of the Medicaid program," Governor Rick Scott (R-Fla.) has introduced plans to expand Medicaid in the Sunshine State. They come on the heels of similar proposals from six other Republican governors nationwide. In November 2011, the U.S. Supreme Court selected Florida’s challenge to the program’s expansion for constitutional review. Ever since Obamacare’s constitutionality was subsequently confirmed last July, Republicans leaders have steadfastly opposed Medicaid expansion, mostly on grounds of party principle rather than logic.

This strategy characterizes the broader American political gulag, leaving many politicos startled by a recent embrace of Medicaid expansion by these GOP governors. What made them change their minds? Following in the wise footsteps of Chief Justice John Roberts, state governments have correctly deduced that neither their budget nor their economy cannot sustain the inevitable economic consequences of refused Medicaid expansion.

As the Supreme Court decision on Obamacare loomed, John Roberts found himself at the crux of an epic intra-court debate. Appointed as the chief justice by George W. Bush in 2005, Roberts reached the pinnacle of jurisprudence with a history of conservative pragmatism. Throughout the Court’s exhausting, month-long deliberation, Roberts fought an internal battle over the feasibility of an Affordable Care Act absent the legislation’s most controversial feature, the individual mandate. The episode illustrated the depths of health care’s politicization. The four associate justices appointed by Democrats  Stephen Breyer, Elena Kagan, Sonia Sotomayor and Ruther Bader Ginsberg  were firmly in support of the law, while Antonin Scalia, Clarence Thomas, Samuel Alito and Anthony Kennedy, all Republican appointees, were vehement opponents. When the day of reckoning came last June, Roberts issued the deciding opinion.

Roberts issued the deciding opinion. He referenced Wickard v. Filburn, a 1942 case brought by an Ohio farmer who was penalized for retaining wheat grown for personal consumption. The Court held that Congress had the power to enforce the Commerce Clause in this instance because the farmer benefitted from artificial price controls "designed to support the price of wheat by limiting supply." As such, the farmer's decision to grow wheat for his own use "allowed him to avoid purchasing wheat in the market," providing him an unfair financial advantage. Roberts equated the circumstances to citizens who use health care without paying for it.

Indeed, Roberts’ pragmatism was on full display. Every American is near certain to use health care at some point in their lifetime. Congress has broad powers to ensure that free riders do not benefit at the cost of the greater populace. Discrediting such a measure’s feasibility or constitutionality would have set a disastrous precedent for the power of Congress to take action in the greater marketplace. Rick Scott, an outspoken healthcare crusader and former medical businessman, was disappointed. "Now is not the time to implement a massive social program that injects nothing but uncertainty and doubt into our economic system," wrote Scott after hearing of the lost decision.

The apparent straightforwardness of the decision, however, masked its more complex components. Partisan debate raged over a provision that allowed states to decide whether or not to participate in Medicaid expansion. Those states opposed to Medicaid’s expansion would inevitably see relative growth in uninsured citizens, who would now be subjected to the individual mandate. States who chose this route would also experience a loss in federal Medicaid funding. At the same time, they also risked an unanticipated influx of Medicaid enrollees, generating worries of budgetary sustainability. Twenty-six states challenged the provision, which was included in the final Supreme Court case.

Unfortunately, the Court was unable to reach a conclusive opinion on its constitutionality. Certainly, the individual mandate was the heart of a Democratic desire to provide universal health coverage to the impoverished. Without Medicaid expansion, however, the requirement was destined to impose externalities of a regressive nature. There is an inverse relationship between insurance coverage and income level. This week, Governor John Kasich (R-Ohio) pleaded with state legislators to pass his Medicaid expansion plan. "I can’t look at the disabled, I can’t look at the poor, I can’t look at the mentally ill, I can’t look at the addicted and think we ought to ignore them. For those that live in the shadows of life, those who are the least among us, I will not accept the fact that the most vulnerable in our state should be ignored." He joined prominent Republican governors – and leading Obamacare opponents  in falling into line with Democratic desires. Rick Scott, along with Arizona Gov. Jan Brewer and Michigan Gov. Rick Snyder, have also introduced plans to expand Medicaid on similar grounds.

They are certain to reap electoral dividends. Voters in the bottom quintile of the income scale hold overwhelming support for Democrats and Medicaid. Knowing the individual mandate is now inescapable at the federal level, state lawmakers are also unlikely to lose support of the party base. Gubernatorial acceptance of health reform reflects a growing state-federal division within the GOP. Perhaps we can call it principle versus pragmatism? The prevailing strategy has yet to be determined, though we can only hope that Republicans hike down the more pragmatic path. I say this not because I am particularly invested in liberal economic reforms, but because it has immensely positive implications for the future of the American political process.

This is an age where inaction is no longer an option; rapid economic transformation requires rapid action. If future presidential administrations encounter the same inefficiencies President Obama has, inaction will become an incessant  or even incurable  plague, as budget deficits are held hostage by weak economic growth, growing wealth disparities and the most expensive health care system in the world.