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HHS Threatened Arizona Over $7.8 Billion in Medicaid Funding

by Benjamin Domenech on March 30, 2012

While the disagreement over the Medicaid mandate to the states was not the largest issue discussed at the Supreme Court this week, one moment during debate deserves attention – the contention by Justice Breyer that the federal government would be “unreasonable” to withdraw the entirety of Medicaid funding to a state over their unwillingness to accept the additional expansion under President Obama’s law. Attorney Paul Clement responded:

MR. CLEMENT: And if I could just add one thing just to the discussion is the point that, you know, this is not all hypothetical. I mean, in — there was a record in the district court, and there is an Exhibit 33 to our motion to summary judgment. It is not in the joint appendix. We can lodge it with the Court if you’d like.

But it’s a letter in the record in this litigation, and it’s a letter from the secretary to Arizona, when Arizona floated the idea that it would like to withdraw from the CHIP program, which is a relatively small part of the whole program.

And what Arizona was told by the secretary is that if you withdraw from the CHIP program, you risk losing $7.8 billion, the entirety of your Medicaid participation.

The letter Clement cites is Exhibit 33 here.

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