Nevada won’t automatically expand Medicaid

Gov. Brian Sandoval said today the impact of the court's decision on Nevada's Medicaid program was not immediately clear, though he was leaning toward not opting in to the expanded program.

"The governor does not intend to automatically accept the Medicaid expansion," his press secretary, Mary-Sarah Kinner, said in a statement this afternoon.

The Supreme Court ruled 7-2 that the federal government could not withhold Medicaid funds from states that don't expand their programs, which provide free health care for the poor, blind, disabled and some of the elderly.

Whether that means states can just refuse to expand their Medicaid rolls was not clear. More than 306,000 Nevadans now receive their health care through Medicaid.

"The implications for Medicaid costs are still unclear, but Nevada will prepare to meet the serious implications of this decision," Sandoval said in a morning statement. "I believe that Congress should act to reform this law and ease the serious burdens it places on the states and the nation's businesses. The American people remain deeply divided on the wisdom of this law and they are still entitled to see it changed."

But Mark Hutchison, the Las Vegas lawyer who represented Nevada for free in its challenge of the Affordable Care Act, said his reading of the decision is Nevada does not have to expand its Medicaid rolls.

"That is a huge impact," said Hutchison, a Republican candidate for the state Senate. "Nevada would have had the highest increase (in Medicaid case rolls). Medicaid is supposed to be a cooperative program with the federal government and states cannot be coerced into expanding their programs."

Estimates by the state Department of Health and Human Services are that Nevada would have to pay an additional $567 million in Medicaid costs between 2014 and 2019 to provide health insurance to people who earn up to 133 percent of the federal poverty level. Sandoval, however, put the expansion at $40 million to $50 million a year during an interview with the Review-Journal on Wednesday.

More than 306,000 Nevadans now receive their health care through Medicaid. Under the Affordable Care Act, that number would increase about 4,000 people a month, according to state estimates.

Hutchison said he was surprised that the court, and particularly Chief Justice John Roberts, upheld the mandate requiring uninsured people, other than those receiving Medicaid, to purchase insurance.

Those people must pay a penalty tax of at least $695 a year on their income taxes if they fail buy health insurance.

But Roberts said the amount of tax they pay can be no more than 60 percent of the average cost of insurance.

Because the penalty is less than the cost of insurance, Hutchison said there will be little incentive for people without insurance to acquire it. They simply will pay the tax penalty.

"This raises taxes on a lot of people who can't qualify for Medicaid, including a lot of people who are pretty poor," he said.

He also questioned whether the Silver State Health Insurance Exchange will be needed. The exchange was set up in Carson City earlier this year to help individuals and small businesses find qualified and affordable health insurance plans.

"The whole purpose of the exchange was that people would have to buy insurance," Hutchison said. "It will be interesting if we keep the insurance exchange."

Reaction along party lines

Early political reaction fell along party lines, with Democratic Sen. Harry Reid commending the decision and Republican Sen. Dean Heller condemning it.

"I'm happy. I'm pleased to see the Supreme Court put the rule of law ahead of partisanship and ruled the Affordable Care Act constitutional," Reid said in a brief speech.

"The United States Supreme Court has spoken," he said. "This matter is settled."

A few hours before the Supreme Court announced its decision, Reid, D-Nev., hosted his weekly breakfast for visiting Nevadans. Among those in town were members of the state's chapter of the Cystic Fibrosis Foundation.

After the court ruled, Reid said the visitors were on his mind. "It's been so hard for these young people to get insurance," Reid said in a short speech. "It's not going to be that way anymore."

For the Senate majority leader, the ruling amounted to somewhat of a vindication for his efforts to get the landmark bill passed in 2010 on behalf of President Barack Obama.

But the Nevadan and most other Democrats kept their reactions short and somewhat muted, choosing not to spike the football after a court ruling that came as somewhat as a surprise.

Many Democrats were bracing for the conservative-leaning court to throw out the centerpiece of the health care law, the requirement that people buy insurance or face a fine.

Instead the justices in their 5-4 ruling allowed the so-called "individual mandate" to stand after saying it could be construed as a tax, and that the powers to levy taxes are well within the jurisdiction of the legislative branch

Reid urged Republicans to put health care behind them and "stop refighting yesterday's battles. Now that this matter is settled, let's move on to other things, like jobs."

Republicans signalled they were not done with trying to repeal or reshape the health care law they long have argued is expensive and unworkable.

The initial reaction of most, including Heller, R-Nev., was focused on the court's description of the individual mandate as an allowed tax.

"This law has now been affirmed as a colossal tax increase on the middle class, and its excessive regulations are stripping businesses of the certainty they need to hire at a time when Nevadans and the rest of the country are desperate for jobs," Heller said in a statement.

"This onerous law needs to be repealed and replaced with market-based reforms that will provide greater access, affordability, and economic certainty to our nation," he said.

Groups react

There was much hugging and high-fiving at the Progressive Leadership Alliance of Nevada's office near downtown Las Vegas four hours after the ruling.

For Michael Ginsburg, PLAN's southern Nevada director, it was a long time in coming.

"Once it set in, I actually shed some tears," he said.

PLAN, a liberal-leaning organization that supports unions and other groups, has been advocating for health care overhaul since its inception in 1994.

Ginsburg and representatives from other local organizations held the press conference to discuss the highlights of what they all called a historic day.

Annette Magnus, spokeswoman from Planned Parenthood of Southern Nevada, stressed that women will have access to birth control without co-pays, and that young adults under 26 will be able to stay on their parents' health insurance plans.

Women "will no longer have to choose between feeding their families ... and buying birth control," Magnus said. "So many people will benefit from this legislation."

The Nevada Policy Research Institute called the high court's ruling a "significant blow to individual liberty."

The conservative think tank's chief legal officer, Joseph Becker, said the decision greatly expanded federal authority beyond the intentions of the nation's founders.

"Not even King George believed he had the authority to compel colonists to buy the tea tossed overboard in Boston Harbor, yet we now have an expansion of federal authority which, through the force of taxation, mandates as a practical matter that citizens must buy private-sector goods," he said in a statement.

This is a developing story. Check back for updates.

Review-Journal reporter Kyle Potter contributed to this report.

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760. Follow him on Twitter @STetreaultDC.