Health Care in the Dock: What’s at Stake for Education?

April 19, 2012 | By Thompson Education | Post a Comment

(This post was written by guest blogger Julia Martin, legislative director of the Brustein & Manasevit law firm.) The U.S. Supreme Court’s decision on the constitutionality of the 2009 health care law will have wide-ranging effects on health care policy and may even tip the balance of the 2012 Presidential election.  But the Court’s decision, expected in June, could also have a profound effect on education.

If the justices decide that the Affordable Care Act (ACA) is unconstitutional, they may strike down the law in its entirety.  This would mean that the education provisions passed in the same legislative package as the health care law — such as the switch from federally guaranteed to direct student loans — would be no more.

But the challenges to the ACA also ask the justices to decide much more fundamental questions of federal law — including whether the federal government can mandate state action in exchange for federal funds.  Among other questions, the Supreme Court must decide whether the requirement that states expand Medicaid or lose federal funding is overly coercive.  If the court decides that the ACA’s Medicaid expansion constitutes congressional overreach, that decision could have wide-ranging implications for many federal laws that operate on the same kind of carrot-and-stick system as Medicaid — including No Child Left Behind.

Medicaid, like No Child Left Behind (NCLB), is a program where states receive federal funds in exchange for operating a program that meets certain standards set by Congress and administrative regulations.  Though the federal funding is significant, in actuality each program’s operational mandates require a heavy financial contribution from the state.  The ACA requires states that operate Medicaid to expand eligibility or face losing all federal funding for the program.  The plaintiffs in the case currently before the Supreme Court have argued that, because States are heavily dependent on federal funding to operate the program, the required expansion is coercive and thus means Congress has overstepped its constitutional role.

In theory, of course, participation in both Medicaid and NCLB is voluntary.  States are not required to participate and, in the past, some have declined the programs and the associated funds. Arizona, for example, did not adopt Medicaid until 1982.  But states are reluctant to opt out because of the loss of funds and the potential negative perception created by the elimination of social services that support fundamental needs like education and healthcare.  Despite NCLB’s problems with unrealistic proficiency targets and onerous sanctions for schools that fail to meet those benchmarks, states are asking for waivers of some of the law’s provisions rather than opting out entirely.  So are such programs truly “optional” when so many depend on the services they support?

If the Supreme Court invalidates the Medicaid expansion as overly coercive and beyond the constitutionally permitted powers of Congress, it does not mean that NCLB will magically disappear.  But that decision could open the door to successful legal challenges from the recipients of federal money who feel that the conditions of their grants are so extensive and stringent as to constitute coercion.  This includes not only the main NCLB law, but also the waiver package offered by Secretary Duncan and any other federal program where both the federal requirements and state buy-in are significant.

In addition, the fact that the court could seriously be considering invalidating the congressional action at play illustrates the depth of anti-government sentiment among conservatives in Washington.  Many conservatives in Congress, and on the Supreme Court, are inherently suspicious of federal authority.  This suspicion means a move in legislation, regulations, and jurisprudence toward less federal involvement in the administration of state- and locally-run programs.  But this trend may come at a price for states — diminishing federal government could translate in many cases into diminishing federal funds.

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