Future of Medicaid tied to Supreme Court Decisions in 2012

The United States Supreme Court will hear two separate cases in 2012 that will have a dramatic impact on what is required of individual states, and the level of autonomy each state will have to make their own decisions relative to future enrollment, benefit coverages and reimbursement rates of their Medicaid programs. The Courts’ rulings could essentially turn Medicaid into a federal “block grant” system, where the federal government provides a set amount of funds to individual states and they determine how best to spend it, which has been the reform route favored by many Governors throughout the health care debate, but which also could have a negative effect on orthotics and prosthetics coverage if implemented.

The first case is the challenge to the constitutionality of the Patient Protection Affordable Care Act (PPACA, Obamacare).  The court is slated to rule on the individual mandate, which mandates all individuals obtain health insurance or pay a fine beginning in 2014, as well as the expansions of Medicaid enrollment to 133% of the Federal Poverty Level. If the court rules that it is unconstitutional for the federal government to essentially force states to increase their enrollment criteria, it would be a severe blow to the federal government having the right to require certain benefit coverages, or check reimbursement rates, etc, essentially allowing states to receive federal matching funds and be free to do whatever they please with them to treat their Medicaid patients.  Considering that orthotics and prosthetics are not a mandated benefit under Medicaid, this could create an environment ripe for states to solve budget holes by cutting non-mandated benefits like O&P.  Courts have issued split rulings on the constitutional argument related to the Affordable Care Act, 3-3 to date. Oral arguments are expected on the challenge to the Affordable Care Act beginning in mid-March.

The second, less noteworthy case is, Douglas v. Independent Living Center of Southern California, which will decide whether Medicaid beneficiaries and providers have the right to sue the state of California for cutting reimbursement rates to the point that they say violate federal rules requiring HHS to provide reasonably attainable care.  The Obama Administration weighed in on the California case in October 2011, arguing that only the federal government has the right to monitor and approve such changes to the state/federal program. Courts have ruled in favor of the state of California to date.

Taken together, the rulings of the Supreme Court on these two cases could potentially have a dramatic impact on the Medicaid program as a whole, and whether orthotics and prosthetics continue to be a covered benefit in many states.  MORE

OPGA Government Relations will continue to monitor these cases and provide updates when appropriate.  These cases only underscore the importance of orthotics and prosthetics benefits being included in “essential health benefits packages” across the country.  Contact OPGA for help contacting your state legislators or insurance commissioners to speak of the importance of orthotics and prosthetics and the positive budget impact of the quality, professional services provided by O&P professionals in your state.

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