It looks like the sloppy wording in the Affordable Care Act cuts both ways.
We’ve been talking about the various challenges to the law arising out of drafting errors, in particular the vagaries of whether individuals seeking coverage on federally-run exchanges substitutes for state exchanges if the state refuses to implement one, can qualify for coverage subsidies. But there’s another drafting issue that could lock states which choose not to expand Medicaid into maintaining their current level of coverage and not cutting it further. The Hill explains:
The federal government might have to operate at least part of the exchanges in as many as 30 states, at least initially. If subsidies aren’t available in those states, the law’s reach would be severely limited [...]
The healthcare law expands Medicaid eligibility beginning in 2014. It also includes a “maintenance of effort” (MOE) provision that prevents states from cutting their existing Medicaid rolls ahead of the expansion.
As shorthand, most people say the MOE lasts until 2014. Technically, though, it expires once the Health and Human Services Department certifies that an insurance exchange “established by the state … is fully operational” — the same language used to describe exchange subsidies.
In short, Republican governors could be stuck with the MOE forever if conservatives win their argument about the law’s insurance subsidies.
This would be a fairly hilarious scenario, with states who opt out of the exchanges forced to keep their Medicaid at current levels. Those costs will rise and there will be nothing the state can do about it until they, against their will, implement an exchange. This is the double-edged sword of the narrow reading of the text of the law.
I don’t think that those trying to stop exchange subsidies from a federal exchange are likely to succeed, actually. But if they do, then the rejectionist states would still have to provide their current level of Medicaid, even though it’s a growing share of state budgets and almost always on the chopping block for cuts. Republican governors are already trying to overturn the MOE requirement.