Arizona Lawmakers Can Challenge Medicaid Expansion, Court Rules

DALLAS - Arizona legislators who failed to prevent expansion of Medicaid eligibility in the legislature can challenge the constitutionality of the law in court, the state Supreme Court has ruled.

In a unanimous New Year's Eve ruling, the state's high court ruled that 36 Republican lawmakers have standing to sue in court to overturn House Bill 2010 passed by the 2013 Legislature and signed into law by Gov. Jan Brewer.

"Because the group had enough votes to have blocked the bill if passage required a supermajority vote, the group has alleged an injury sufficient to confer standing," Justice Rebecca White Berch wrote. "The Arizona Constitution requires that certain acts that increase state revenues must pass the legislature by a supermajority vote."

The ruling returns the case to Maricopa County Superior Court, which previously ruled that the 27 representatives and nine senators lacked legal standing to sue. The lower court ruled that the Legislature has discretion over whether a super majority is required. The Supreme Court ruled that the constitutional requirement prevails.

As the case develops, the law that provided Medicaid insurance coverage to 297,000 Arizonans remains in place.

The Republican lawmakers will argue in district court that HB 2010 was passed illegally because an "assessment" on Arizona hospitals to cover the cost of Medicaid coverage constitutes a tax.

With the ruling coming five days before she left office, Brewer said she was "disappointed" with the decision, but "abundantly confident that Arizona will ultimately prevail, and that the state will be able to focus on implementing one of the most meaningful and critical health care policies in years - the restoration of crucial, cost-effective care to thousands of Arizonans."

Incoming governor Doug Ducey campaigned in support of the lawmakers' litigation because he said they deserved the chance to make their case in court. However, he has not said whether he supports Medicaid expansion in the state.

With the legislature convening, current lawmakers could find a way to cover Medicaid without assessing the hospital fee, lawmakers said. However, the state faces a $1 billion budget shortfall, making revenue hard to find.