BOISE — The lawsuit challenging Idaho’s voter-approved Medicaid expansion initiative relies on a legal theory that an Idaho law professor calls “a real long shot” and “a particularly thin argument.”
The lawsuit, filed by the Idaho Freedom Foundation, charges that the initiative is unconstitutional because it delegates lawmaking power to Idaho’s executive branch and to the federal government, by ordering the Idaho Department of Health and Welfare to implement Medicaid expansion and by citing the federal law provision that covers it.
“Because they do that, the federal government can change those provisions and that becomes law in the state, without legislative action from the state,” said Bryan Smith, attorney for the Freedom Foundation and lead plaintiff Brent Regan, the foundation’s board chairman. Smith wrote in a brief filed with the Idaho Supreme Court this week that the initiative should have cited the federal law “as currently codified.” Without those words, Smith wrote, Idaho could possibly be subject to “unknown and unknowable future federal provisions.”
That would violate the Idaho Constitution’s separation of powers clause, Smith argues, which lays out the three branches of Idaho’s state government — the legislative, judicial and executive.
McKay Cunningham, an associate professor of law at Concordia University in Boise, said the “non-delegation doctrine” has been around for a long time, both in federal and state law. But it’s generally fallen by the wayside since 1935, when the U.S. Supreme Court began approving delegation of duties from Congress to executive branch agencies as the nation grew.
“Since 1935, the Supreme Court has never found any delegation of rulemaking or quasi-judicial power to an executive agency to be unlawful, no matter how scant the guidelines that Congress in its enacting legislation provided to that agency,” Cunningham said.
He noted that in a 1985 case, Sun Valley Company vs. City of Sun Valley, the Idaho Supreme Court said, “The modern view is that broad delegation of legislative authority is proper and indeed necessary.”
Cunningham said in Smith’s brief, all but one of the cases cited on that point were from before 1935. The lone exception, a 1960 Idaho Supreme Court case involving savings and loans, “stands alone, it stands in contravention to the vast majority of instances in which the Legislature has delegated rulemaking authority in any number of different contexts,” he said.
In fact, the Idaho Constitution expressly authorizes administrative rulemaking with review by the Legislature. That provision was added to the Constitution by HJR 2, approved by Idaho voters in 2014.
Smith said he believes Proposition 2, the Medicaid expansion initiative, goes beyond rulemaking and actually leaves the setting of standards to agencies or the federal government. It requires the state to amend its state plan for Medicaid eligibility to include “those persons under 65 years of age whose modified gross income is 133 percent of the federal poverty level and who are not otherwise eligible,” in accordance with the applicable federal law on Medicaid expansion.
The Idaho Attorney General’s certificate of review, which was issued before the initiative went on the ballot, found that the wording “tracks with provisions of the ACA,” the federal Affordable Care Act. “Those basic provisions of the ACA were upheld by the U.S. Supreme Court against constitutional challenge,” the certificate of review stated.
Cunningham said it’s not even clear to him that the initiative makes a delegation of rulemaking. “Where is it?” he asked. “I don’t see it.” The standards for Medicaid expansion, age and poverty level, were laid out in the initiative, he said.
Luke Mayville, author of the initiative and a political scientist, said, “The language of our initiative is consistent with the language of Medicaid expansion laws of over 30 other states.”
“The reality is what the initiative does is it delegates not lawmaking authority, but implementation authority,” Mayville said, “which is perfectly consistent with not just the Idaho Constitution but with the classical ideal of the separation of powers.”
He said he wondered if the lawsuit was a delaying tactic, given the initiative’s overwhelming approval at the polls. “From a cynical point of view, it’s not surprising,” he said. “From a moral point of view, it’s frustrating that politics would be prioritized over the health coverage of tens of thousands of Idahoans.”
Smith, a former GOP congressional candidate who owns a medical bill collection business and has filed thousands of lawsuits to collect medical debt, bristled at recent widespread suggestions on social media that he has a conflict of interest on the issue. “I don’t think I have a conflict,” he said. “But doesn’t every single doctor who advocated for Medicaid expansion have a conflict, because they get payments from the federal government?”
Smith said his business would be unaffected by Medicaid expansion, because “we only collect money from people who can pay, not from people who can’t pay … and by definition, people who fit in the Medicaid expansion arena, they can’t pay.”
“This to me is more about a legal issue,” he said. “It’s also an ideological issue for me — I’m opposed to Medicaid expansion, I think it’s wrong-headed that we’re redistributing wealth simply because people think it’s a good idea. I don’t think it’s a proper role of government, I think it’s too expensive, I think it’s going to break us.”
The initiative expands Medicaid in Idaho largely at federal expense to cover those who currently fall into a coverage gap, because they make too much to qualify for traditional Medicaid, but not enough to qualify for subsidized health insurance through the state insurance exchange. Idaho was one of three states whose voters opted to expand Medicaid on Nov. 6; 33 states had previously taken that step.
Cunningham noted that there’s another legal issue that could prevent the high court from even taking up the lawsuit. While a specific state law allows such challenges directly to the state Supreme Court, the last time that law was used in a challenge, against the voter-passed tribal gaming initiative in 2002, the court rejected the case, saying the law allowing direct challenges to the Supreme Court was unconstitutional.
“This court’s original jurisdiction is set forth in the Constitution,” the court wrote in a June 2, 2003, order signed by then-Chief Justice Linda Copple Trout. “The legislature has no power to extend this court’s original jurisdiction.”
Cunningham said, “I have some lack of clarity with regard to whether or not that has precedential value. Clearly, if it does, then this lawsuit before us by the Idaho Freedom Foundation really has nowhere to go. I can’t see how the Idaho Supreme Court can countenance this lawsuit.”