State Controlling Board Had Legal Authority to Approve Request for Federal Medicaid Funds
The state Controlling Board did not violate the law when it approved the Ohio Department of Medicaid’s request for increased appropriation authority to accept federal Medicaid funds available to the state under the federal health care law, the Supreme Court of Ohio ruled today.
When the General Assembly passed the state budget bill earlier this year, it included a provision prohibiting Ohio’s Medicaid program from expanding to cover more people under the federal health care law. The governor vetoed that provision, and the General Assembly did not override the veto.
In the court’s lead opinion, Chief Justice Maureen O’Connor stated that after Governor John Kasich’s veto, the law allowed the state to provide the optional Medicaid coverage for a new group of Ohioans. Given that authority, she wrote, the Controlling Board was permitted to increase appropriations to cover the costs of insuring more people.
In 2010, the U.S. Congress enacted the Patient Protection and Affordable Care Act. In part, the health-care legislation expanded the scope of those required to be covered by Medicaid to all individuals under the age of 65 with incomes below 133 percent of the federal poverty line. The law guaranteed that the federal government would pay the states for all of the costs to cover these newly eligible individuals through 2016.
In June 2012, the U.S. Supreme Court ruled, however, that coverage of these individuals must be an option, rather than a requirement, for the states. In the state budget bill passed by the Ohio legislature this year, the legislature included a provision intended to prevent the state from providing coverage to the new group. However, the governor exercised his line-item veto authority and vetoed that provision.
In the court’s opinion today, Chief Justice O’Connor explained that the state budget bill passed and signed into law this year gives the state Medicaid program authority to cover any optional group eligible under federal law. She noted that, after the governor’s veto, the law no longer expressly prohibited the state from choosing to provide the optional Medicaid coverage for the new group.
The parties challenging the Controlling Board’s appropriation for Medicaid funding argued that the Controlling Board could not act contrary to the General Assembly’s intent, which was to prevent coverage for the new group. The lead opinion rejected that argument.
The lead opinion noted that the limitations on the state Controlling Board are found in R.C. 127.17, which states:
The controlling board shall take no action which does not carry out the legislative intent of the general assembly regarding program goals and levels of support of state agencies as expressed in the prevailing appropriation acts of the general assembly.
“R.C. 127.17 indicates that the legislature’s intention is to be found in the ‘prevailing appropriation acts of the general assembly,’” Chief Justice O’Connor wrote. “Black’s Law Dictionary defines ‘prevail’ as ‘[t]o become effective or effectual, to be in force, to obtain, to be in general use or practice, to be commonly accepted or adopted.’ The ‘prevailing’ appropriations act is therefore the one that has become effective or in force. Under our constitution, an act is not effective and in force, that is, it does not become law, until it is approved by both houses of the General Assembly and signed into law, or permitted to become law, by the Governor. … Any other conclusion would create a constitutional crisis.”
“The Ohio Constitution expressly confers upon the governor authority to excise any item or items in an appropriation bill, and such disapproved items ‘shall be void,’” the chief justice continued. “But R.C. 127.17, as construed by relators, would operate as a statutory negation of the governor’s constitutional powers. The General Assembly would have the power to command the controlling board, in all cases, to disregard the governor’s veto in the implementation of appropriations. This interpretation is clearly contrary to the ‘checks and balances’ that are critical to our constitutional democracy.”
She noted that the Ohio Constitution permits the General Assembly to override a veto by a vote of three-fifths of the members of both houses. However, “[t]he legislature cannot circumvent this constitutional option by obtaining a writ from this court that forbids the controlling board from complying with the law, as that law is modified by the governor’s veto.”
The court’s lead opinion was joined by Justices Paul E. Pfeifer and William M. O’Neill. Justice Judith Ann Lanzinger concurred in judgment only.
Justice Terrence O’Donnell dissented in a written opinion.
In his dissent, Justice O’Donnell noted that the judiciary’s role is to decide legal questions. He concluded that this case involves a political question that should be resolved by the political branches of government.
“This court’s intervention is sought in a conflict that exists solely within the legislative branch, asking us to supervise its internal functioning and decision making and implicating the power of the General Assembly to oversee its own affairs in regulating a legislative arm of its own creation,” he stated. “These matters are not the subject of judicial cognizance.”
“The General Assembly established the Controlling Board solely as a convenience, delegating to it authority to make the myriad adjustments to appropriations needed on a periodic basis,” Justice O’Donnell explained. “Because it is a creature of statute, the Controlling Board is wholly accountable to the legislative branch of government.”
Citing the dissenting opinions of Justices Robert Holmes and Paul Brown in State ex rel. Meshel v. Keip (1981), Justice O’Donnell noted that “‘[t]he General Assembly has unlimited right to terminate, recall, or abridge the delegated power of the Controlling Board if it so desires.’ Or, as Justice Paul Brown put it in his dissent in Meshel, ‘The General Assembly, as a body, clearly is empowered to reverse any decision of the Controlling Board.’”
“The General Assembly has both the incentive to protect its prerogatives and the institutional mechanisms to do so,” Justice O’Donnell concluded. “This case involves an impermissible judicial foray into the province of the legislature and raises a political question that is not justiciable and which we ought not to answer. The complaint should be dismissed.”
Justices Sharon L. Kennedy and Judith L. French dissented without opinion and would dismiss the case.
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