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The flaw in the Medicaid argument

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The Idaho Supreme Court decision in the challenge to the Medicaid expansion initiative – the case Brent Regan v. Lawerence Denney – was highly predictable, and a lot of people did predict it. With the decision in hand now, sustaining the initiative, it’s worth reviewing why that is.

We almost didn’t get this decision because two justices didn’t think Brent Regen, the plaintiff (on behalf of, mainly, the Idaho Freedom Foundation) shouldn’t have been able to bring it. The court’s majority didn’t even entirely dispute that point, admitting that it was stretching things even to deliver an opinion. But it’s as well that they did, since the decision made so clear why the argument against the initiative was so deeply flawed.

The Regan argument didn’t have to do specifically with the expansion of Medicaid benefits, or even with Medicaid at all. That may come as a surprise, given the political rhetoric surrounding the case, and the issue. The legal argument for overturning the initiative was, roughly:

The initiative violated the Idaho Constitution for the reason that it gave away legislating authority from the state to the federal government, since the agreement with the federal government on Medicaid expansion might commit the state to agree to future changes in the rules governing Medicaid.

First, the Supreme Court said, that is simply wrong. The court reviewed previous decisions that refer to references to law in other places, and found those, “affirmed the idea that when a statute references a second statute, it adopts that statute as it is in its current form. Subsequent amendment or repeal does not affect the initial statute.”

Anyone who follows the Idaho Legislature should know as much. Look through the annual list of bills passed by that body and often you’ll see new bills passed to update for changes made elsewhere. The state income tax law, which integrates in places with the federal, is regularly updated by the legislature (sometimes provoking debate along lawmakers).

The court made that point in its decision: “It should be noted that section 56-267 [the Medicaid expansion provision] is not the first nor is it the only statute to reference federal law. In fact, many Idaho statutes reference federal law. For example, Idaho Code section 33-2202 provides that: The state board of education is hereby designated as the state board for career technical education for the purpose of carrying into effect the provisions of the federal act known as the Smith-Hughes act, amendments thereto, and any subsequent acts now or in the future enacted by the Congress affecting vocational education …”

A truckload of laws relating just to commercial activities in the state would have been upended if the Medicaid expansion challenge had been approved, because the same principle in law would have torn up all kinds of federal, interstate and other agreements. It wouldn’t be a reach to say that large sectors of Idaho’s economy could have been thrown into chaos by a bum decision in this case.

Here’s another example the court cited: “the statute governing who could sell prescription drugs did ‘not specify which drugs shall require a prescription order, but instead conditions that status upon three possible alternatives: (1) another state law, (2) a law of the United States, or (3) a rule or regulation of the Idaho Board of Pharmacy. … In noting that the area of drug regulation demanded particular practical considerations, this Court said, ‘[i]n deciding whether a delegation is proper the court’s evaluation must be ‘tempered by due consideration for the practical context of the problem sought to be remedied, or the policy sought to be effected.’’’

The practical effects of this Medicaid expansion decision, had it been handled badly, could have been extreme. That partly explains why so many legal analysts thought the decision in favor of the initiative was a slam dunk, and why the court’s major internal disagreement on it concerned whether a ruling on the challenge was even warranted.

The beneficiaries of Medicaid expansion dodged a bullet here, but not only them. So did a lot of other people.
 

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