But what happens if states choose not to expand Medicaid to meet the new guidelines? That's where the conservative majority, joined by liberals Stephen Breyer and Elana Kagan, surprised a lot of people. As the law was originally written, the entire Medicaid package became an all-or-nothing deal: States that didn't want to meet the new, more expansive guidelines were free to do so. But choosing that option meant forgoing all federal Medicaid money. The Court on Thursday ruled that choice was "coercive." Roberts, echoing the arguments of the law's challengers, likened it to holding a gun to the states' heads.
The remedy was not as extreme as it might have been: The justices didn't strike down the Medicaid expansion altogether. But they insisted that states choosing not to expand coverage give up only the money that would have gone to covering the new populations. Those states would remain eligible for the funds that they already get, to cover people who already qualify for Medicaid under the old guidelines.
And yet, it's extreme enough: people who do not have health insurance and cannot afford it under traditional private insurance plans will not have as much opportunity to get it.
My suspicion is, as with stimulus funds, over the longer term states will give up and give in. Governors across the nation at first were foursquare against accepting those funds, but quietly, even the last holdouts like Chris Christie have reneged on those vows. Same thing will likely happen here.
But here's the thing: this isn't just about Medicaid. For example, did you know that if your state doesn't set its speed limit at 55 (or require seat belt use, for that matter), it is ineligible for federal highway funds? In the future, the Federal government will have a hard time instituting sane regulation in exchange for dangling road repair in the faces of governors like a cherry for a sundae. The courts are effectively saying "You can only refuse to give more money than the status quo."
So...this is a pretty effective demolishment of much social engineering that the Federal government could impose (and includes such right wing plums as defense contracts and even a potential military draft) while at the same time putting social engineering through tax impositions into jeopardy.
Even tho the courts were pretty adamant that the individual mandate was a tax, it does not mean every tax will be allowable. And it won't surprise me if another lawsuit is forthcoming on that point with respect to ACA, anyway.