PHOENIX – A lawsuit challenging Arizona Gov. Jan Brewer's Medicaid expansion plan that was filed by fellow Republicans in the state Legislature was dismissed in a ruling released Saturday, handing Brewer a major victory in her battle against conservative members of her own party.
Maricopa County Superior Court Judge Katherine Cooper agreed with Brewer that the lawmakers challenging the law don't have the right to sue, saying their argument was incorrect that a hospital assessment included in House Bill 2010 that passed in June was, in fact, a tax that required a supermajority vote of the Legislature under Arizona's Constitution.
Cooper's ruling, dated Friday, said it is the Legislature itself that determines if a two-thirds vote is required under a voter-approved constitutional amendment called Proposition 108.
A bipartisan coalition of lawmakers Brewer assembled to support her plan voted not to impose that requirement on the law, which expanded the state's health insurance program for the poor, known as the Arizona Health Care Cost Containment System, or AHCCCS, and imposed the hospital assessment.
"In short, Plaintiffs are a minority group within the Legislature who lost a battle over H.B. 2010. They do not claim a concrete, individual injury. Rather, they seek to overturn the vote of the House and Senate. The Legislature as a whole did not authorize them to bring this action," Cooper wrote.
Brewer spokesman Andrew Wilder called the court ruling on expanding "a huge victory."
"Judge Cooper's ruling is thoughtful and legally sound," Wilder said in a statement. "As a result, the state can move forward with implementing the Governor's Medicaid Restoration Plan without further distraction of litigation, thereby restoring cost-effective health care to tens of thousands of Arizonans through AHCCCS, and honoring the will of voters.
"The governor hopes this will put an end to the case and she looks forward to continuing to work with lawmakers on other important state business in the coming weeks."
That's not likely. The suit was filed by the Goldwater Institute on behalf of 36 Republican legislators and three citizens, and Goldwater issued a statement saying it planned to appeal.
"Unfortunately, this ruling greatly damages Arizona's critically important voter-enacted constitutional protection requiring a two-thirds legislative supermajority for all new taxes, even when the government is responding to a `crisis or emergency' or a program `for the poor,"' Goldwater attorney Christina Sandefur said. "If this decision stands, it would enable a simple majority of legislators to vote to ignore a constitutional supermajority requirement when politically convenient, shielding that vote from legal challenge."
The hospital assessment is expected to collect $256 million in the state's 2015 budget year to pay the state's share of expanding Medicaid to about 300,000 people. Those to be covered include people earning between 100 percent and 138 percent of the federal poverty level and childless adults making less than that who lost optional coverage provided by Arizona when the state went through a budget crisis during the Great Recession.
Coverage began Jan. 1, and the most recent figures from the state's Medicaid program show about 30,000 people have gained coverage so far.
Hospitals strongly backed the assessment because they expect to see a much bigger reduction in the cost of treating uninsured patients. Cooper noted that they did not sue and are the only potentially injured party with a right to oppose the assessment.
Brewer is one of only a handful of Republican governors who embraced Medicaid expansion, a key part of President Barack Obama's health care overhaul law. In all, 25 states plus Washington, D.C., are moving ahead with the expansion, while 19 states have turned it down. Another six states are weighing options.
Brewer spent months trying to get Republicans who control both chambers to support Medicaid expansion. She convinced a handful of Republicans to join all minority Democrats and put together a majority that supported the move, but leaders refused to let it come to a vote. She finally rammed it through in June after calling a special session to get around recalcitrant GOP House and Senate leaders.
Rep. John Kavanagh, one of the Republican lawmakers who sued, said he hopes an appeal is successful.
"My gut reaction is that a Prop. 108 decision should stand on its own and that anybody should be able to challenge a violation of a taxpayer protection law," said Kavanagh, a vocal opponent of Medicaid expansion. "The only people who can violate (the law) are the Legislature, so if it doesn't apply to us, they just threw out the whole concept of controlling the Legislature.
"It's very disappointing. A law that was passed to control the Legislature, a judge proclaims doesn't apply to the Legislature."
But Wilder noted that the Republican-controlled Legislature has repeatedly increased fees and assessments in recent years without imposing the two-thirds vote requirement for a tax increase.
"They can only be upset at themselves," Wilder said.