Brewer intent on suing federal government over health care bill

Gov. Jan Brewer

Gov. Jan Brewer

PHOENIX -- Gov. Jan Brewer wants a special session this coming Monday to get clear authority to sue the federal government over the new health care bill.

Brewer also wants lawmakers to approve a resolution asking Congress to come up with the cash Arizona needs to keep its health care program running between now and when new federal aid becomes available in 2014. If Arizona cuts back its programs -- as lawmakers already have voted to do and Brewer has approved -- it would lose billions of extra dollars in the new health plan.

Even with that risk, though, Brewer is not asking the Legislature to restore health funding if Congress doesn't cough up the extra cash, at least not yet.

But one solution may be coming from an outside source.

Rep. Kyrsten Sinema, D-Phoenix, said Friday the Arizona Hospital and Healthcare Association is preparing an initiative for the November ballot which would hike taxes on corporations and the wealthy to pay to keep health coverage for the poor at current levels.

The plan is modeled after a pair of ballot measures were approved in January in Oregon. One raises taxes on households with taxable income above $250,000; the other sets higher minimum taxes on corporations and increases the tax rate on certain profits.

But any funds would not be available until after Arizona voters approve the plan in November -- assuming they go along.

In the interim, time is limited: The budget Brewer signed into law earlier this month eliminates the Kids Care program which provides nearly free health insurance for children of the "working poor,' effective June 15. That designed to save $18 million.

The federal legislation, however, spells out that any state which reduces its current health programs below current levels immediately forfeits the right to future health care dollars from Washington.

Gubernatorial press aide Paul Senseman said Brewer won't ask lawmakers to fund that $18 million now, wanting to wait to see if Congress comes up with extra cash.

But she does want immediate legislative authority to join the lawsuit filed by more than a dozen other states challenging the authority of Congress to effectively force states to spend money they don't have to maintain health programs. The governor said she needs that because Attorney General Terry Goddard won't sue after concluding the federal law is legal.

Sinema said her sources in Washington tell her that Congress will approve and President Barack Obama will sign legislation within the next month to extend a program that already provides extra stimulus dollars to underwrite each state's health care costs for another year. She said that should secure an extra $400 million for the state.

But Senseman admitted that if it gets close to June 15 and there is no new federal cash, Brewer will have no choice but to come up with the necessary $18 million needed to keep Kids Care operating through June 2011 to keep Arizona eligible for the extra dollars in the new federal health care legislation. He said no one wants to put future federal dollars in jeopardy.

"We will be forced by this mandate to figure out a solution,' Senseman said.

Less clear -- and more expensive -- is what happens if there are no new federal dollars by Dec. 31. That's when the new state budget proposes scaling back eligibility for the Arizona Health Care Cost Containment System, the state's Medicaid program, removing more than 310,000 people from the program, a change that also would disqualify Arizona from future federal aid.

If Arizona continues the program at current levels for another six months, to June 30, 2011, the federal government will pick up two-thirds of the total cost, as it does now. But Brewer and lawmakers said the state can't afford the $385 million state share for that six months.

Senseman had no answers to where the state could find that cash if Congress does not.

"That's an excellent question,' he said. "There are no obvious solutions.'

That is where the initiative for higher taxes would come in.

Sinema said, though, there is an option if that fails: Eliminate some of the tax exemptions that now exist. That, however, would require a two-thirds vote of the Legislature.

Central to the whole fight is the lesser-known part of the new federal law. While much of it deals with mandates for people to buy health insurance -- a provision Brewer also contends is unconstitutional and wants to challenge -- it also would expand government-funded care for the poor.

Much of the cost will be borne by the federal government.

For example, while the feds now cover about 66 percent of the total cost of the AHCCCS program, that figure would rise to at least 83 percent in 2014 and go as high as 93 percent.

But that extra cash won't be available until 2014. And to qualify, states cannot scale back their existing programs.

Brewer wants to sue because Attorney General Terry Goddard would not.

He said nothing in that "maintenance of effort' provision amounts to an unconstitutional mandate on states. He said it simply is an incentive, with states free to stop participating in Medicaid.

Goddard also disagrees with Brewer's contention that Congress has no authority to mandate that people buy health insurance. Here, too, Goddard said, there is no mandate but a choice: Buy health insurance or pay a financial penalty.

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