Will Missouri expand Medicaid? Lawsuit heads to trial today to answer that question

Backers of Medicaid expansion want the courts to find that lawmakers “hide elephants in mouseholes” and order the state to allow 275,000 people to enroll in the public healthcare system, attorneys for the state will argue today in Cole County Circuit Court.

That is not so, respond the attorneys for the three people suing on behalf of those who would be eligible for coverage under the terms of the initiative approved by voters in August 2020. The courts should read “the plain language” of appropriation bills and order the state to open the rolls, they will argue.

The trial this afternoon in Circuit Judge Jon Beetem’s courtroom will be the first stop for a case that is almost certain to receive final resolution from the Missouri Supreme Court. While the decision will ultimately be based on issues of constitutional construction and legislative intent, the real-world impact will be whether low-income working adults will have access to medical coverage.

The pre-trial filings show the approach each side will take in oral arguments. 

The facts, laid out in an agreed format, are not in dispute. But how each piece fits together in the law is.

It is not certain whether Beetem will issue a ruling today when arguments conclude, but a decision is expected quickly to get the case to an appeals court before the new state fiscal year begins July 1. That is the same day that Medicaid coverage under the terms of Amendment 2 takes effect.

In his January budget proposal, Gov. Mike Parson recommended adding $1.9 billion to the state budget to cover the cost of expansion, including about $130 million in state general revenue. But at every step of the process, the majority voted not to include the funding, showing clear legislative intent not to allow coverage, briefs filed by Attorney General Eric Schmitt’s office argue.

“Key legislators on both sides of the issue understood that the legislature had not funded the expansion, and the governor, sharing that understanding, withdrew the state plan amendments for medicaid expansion,” wrote Assistant Attorney General John Sauer.

The arguments from the plaintiffs, Sauer wrote, ask the court to ignore that and determine that because the appropriation bills do not prohibit spending money on Medicaid expansion, the state must do so.

“Only the clever plaintiff’s attorneys in this case grasped the secret meaning of (the appropriations bill) — that it had, against everyone’s reasonable expectations, actually funded medicaid expansion,” Sauer wrote.

Since 1945, the Missouri Constitution has prohibited initiatives that require appropriations if the same ballot measure does not generate the needed revenue. Because Medicaid expansion is sure to have some cost, the state argues, if lawmakers do not provide money to pay for the coverage, the 2020 measure has no force.

In their arguments, attorneys Chuck Hatfield and Lowell Pearson point out that the actual cost of the Medicaid program is never known when lawmakers approve the state budget. The result is usually a large supplemental spending bill — this year, for example, it totalled more than $500 million.

Appropriations bills provide money for particular classes of medical services such as hospital care or prescriptions, Hatfield and Pearson write, not particular eligibility categories. Because all Medicaid recipients are eligible for the same benefits, the court must order the state to allow their clients to enroll.

“Despite defendants’ attempts to distract with references to legislative floor debates and failed legislation, they are irrelevant in this instance,” the attorneys wrote in their pre-trial brief. “The question here is whether the plaintiffs are required to be enrolled and whether defendants (all executive branch agencies) have the authority to enroll plaintiffs in the MO HealthNet program.”

The constitutional amendment for Medicaid expansion enshrines the eligibility of the targeted population — adults from ages 19 to 64 — as a right, Hatfield and Pearson wrote.

Currently, adults who do not qualify because of a disability or other reason can only be covered by Medicaid if they have children and a household income below about 16 percent of the federal poverty guideline.

The expansion group is adults with household incomes up to 138 percent of the federal poverty guideline. That is $17,774 a year for a single person, equal to working about 33 hours a week at the state minimum wage of $10.30 per hour. For a household of four, the limit is $36,570, the income of one person working full at $17.58 an hour or two people working a combined 68 hours a week at minimum wage.

“The constitution’s repeated use of the term ‘shall,’” Hatfield and Pearson wrote, “makes clear that defendants have no discretion to deny coverage to an eligible individual.”