Health reform? It's been to court before

Health programs have been met with protest, such as this rally in Philadelphia in 2009. (AP Photo / Matt Slocum)

When it comes to health policy, it’s déjà vu all over again – and again.

Did you hear that state attorneys general are suing the federal government, claiming that the massive health reform law is unconstitutional? They call the law an unprecedented intrusion on state sovereignty.

A major focus of the suit is the law’s expansion of Medicaid. The states decry the heavy-handed way in which the federal government is expanding the program and say it will burden them with substantial new costs.

No, I’m not referring to the lawsuit that is pending before the Supreme Court over the constitutionality of “Obamacare.” I’m referring to a suit filed in 2006 with the support of 15 state attorneys general over the law that added Medicare’s prescription drug benefit. Perhaps that law, which was passed along party lines with strong support from the president at the time, should be called “Bushcare.”

The Medicare prescription drug law was a massive reform effort. It implemented the largest expansion of Medicare in history and was projected to cost close to $1 trillion over 10 years.

What outraged the 15 states in 2006 was the law’s effect on Medicaid, the state-run program that covers the poor. Before the law’s enactment, state Medicaid programs exercised full control over drug coverage for the poor. After it went into effect, the federal government took over coverage for those who are both poor and elderly. It paid the cost for these beneficiaries as part of the Medicare program, but then “clawed back” most of the funds from the states.

The attorneys general who challenged Bushcare called the clawback arrangement an unconstitutional new tax and a federal intrusion into state prerogatives. (Click here to read their complaint.)

You probably haven’t heard about the case because it didn’t get very far. The challenge failed when the Supreme Court declined to hear it.

Fast forward six years, and the Supreme Court is once again considering a challenge to a health reform law by a group of state attorneys general. This time, there are 26 of them. Once again they call it an unprecedented federal intrusion into state sovereignty. And once again, a major change to Medicaid forms a key part of their complaint.

Of course, Obamacare and Bushcare differ in important ways. Obamacare provides comprehensive coverage for everyone, not just drug coverage for the elderly. And the challenge to that law goes beyond its expansion of Medicaid. Its opponents object especially vehemently to its mandate that every American have health insurance.

But it is important to remember that the situation we are in today is not so new. Major health reforms have been enacted before, opponents have tried to undo them, and the Supreme Court has been called upon to intervene. Even Medicare followed this pattern after its passage in 1965.

Opponents like to style Obama’s health reform plan as unprecedented and the legal challenge by a group of attorneys general as unique. But neither characterization is correct. Obama’s plan is another in a long series of reform initiatives stretching back decades. Many of these efforts also raised strong emotions on both sides, along with claims of unconstitutional overreaching.

Whatever the fate of health reform this time around, it is important to remember the history that lies behind it. Obama’s efforts are hardly radical, and his opponents have not uncovered an unparalleled attempt at government expansion. We have seen this scenario before, and, in all likelihood, we will see it again.

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