Arizona governor's Medicaid plan heads to court

PHOENIX (AP) — Six months after she pushed an expansion of the state’s Medicaid health insurance plan through Arizona’s Legislature, Gov. Jan Brewer‘s effort to extend coverage to 300,000 additional residents faces a crucial test Friday.

Lawyers for the conservative Republican governor are trying to convince a judge that a court challenge by fellow Republicans in the Legislature should be blocked. The lawmakers, 36 in all from both chambers, argue that the expansion plan Brewer shepherded through the Legislature in June violates the state Constitution because it raised taxes without a required two-thirds vote.

Brewer passed the law by putting together a coalition of Democrats and some Republicans who supported the expansion. She argues that a hospital assessment designed to pay the state’s costs isn’t a tax.

Brewer is one of only a handful of Republican governors who embraced Medicaid expansion, a key part of President Barack Obama‘s health care overhaul law. In all, 25 states plus Washington, D.C., are moving ahead with the expansion, while 19 states have turned it down. Another six states are still weighing options.

Brewer’s lawyers say in court documents that the GOP opponents are trying to “lure judicial intervention into a political debate that has been resoundingly resolved in a bipartisan manner.” They want the case tossed on a technicality, saying the challengers don’t have “standing” to bring the suit.

“Legislators lack standing because they seek relief for a political loss during the legislative process brought about by their colleagues in the Legislature,” attorney Douglas C. Northup wrote.

The lawsuit was filed by the conservative Goldwater Institute on behalf of legislators and a pair of citizens. They argue that a voter-approved law, Proposition 108, that requires a supermajority vote on tax matters applies, and they say Brewer’s effort to call it a “hospital assessment” offers no shield. They also say lawmakers certainly have standing to raise a constitutional question.

If they win, the Medicaid expansion remains in place but the mechanism that brings in cash to match billions in federal spending is lost.

“Proposition 108’s aim is to protect Arizonans from government growth and new taxes by empowering a minority in the Legislature to block tax increases,” Goldwater attorneyChristina Sandefur wrote. “Indeed, the only reason Legislator-Plaintiffs were “outvoted” is because their votes were not counted as the law requires.”

The hospital assessment is expected to collect $256 million in the state’s 2015 budget year to pay the state’s share of expanding Medicaid to people earning between 100 percent and 138 percent of the federal poverty level. Coverage begins Jan. 1. Hospitals strongly backed the assessment because they expect to see a much bigger reduction in the cost of treating uninsured patients.

Sandefur said in an interview Thursday that she’ll appeal if the case is dismissed.

“But I think that the case law is pretty solidly on our side here,” she said. “As long as politics aren’t involved, I think we should probably be OK.”

Another Republican governor who pushed expansion, John Kasich of Ohio, is also facing a court challenge after he bypassed Republican opponents in the Legislature who opposed Medicaid expansion. Kasich instead brought a request to spend billions in federal money to expand the program to a powerful Legislative panel, where he needed fewer votes than the full General Assembly. Opponents are asking the Ohio Supreme Court to void that vote.

In Arizona, Brewer spent months trying to get Republicans who control both chambers to support Medicaid expansion. She convinced a handful of Republicans to join all minority Democrats and put together a majority that supported the move, but leaders refused to let it come to a vote. She finally rammed it through in June after calling a special session to get around recalcitrant GOP House and Senate leaders.