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Arizona lawsuit targets Gov. Brewer’s Medicaid plan

PHOENIX — Opponents of a new law expanding Medicaid in Arizona took their
fight to court Thursday, suing Gov. Jan Brewer to overturn key provisions of the
law she pushed through the Legislature in June over the objections of
conservative Republicans.

The lawsuit filed in Maricopa County Superior Court on behalf of 36 Republican
legislators and a pair of citizens by lawyers for the Goldwater Institute
contends a hospital assessment in the law is a tax that required a 2/3 vote of
the Legislature under the state Constitution. It also alleges that allowing the
director of the state’s Medicaid program to set the assessment and exempt some
providers gives him taxing authority that properly belongs to the Legislature.

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 people earning
between 100 percent and 138 percent of the federal poverty level. Hospitals
strongly backed the assessment because they expect to see a much bigger
reduction in uninsured patient costs.

Medicaid expansion barely passed both houses with support from all Democrats
and a handful of Republicans during a special session Brewer called in June to
get around recalcitrant GOP House and Senate leaders.

“By enacting a tax without the two-thirds majority required by our
Constitution, the state has disenfranchised citizens whose representatives
opposed the tax,” Goldwater attorney Christina Sandefur said in a statement.
“Legislators are beholden to their constituents, but bureaucrats have no such

Brewer has argued that the Legislature has a long record of getting around the
2/3 vote requirement in 1992’s Proposition 108 by allowing agencies to set fees,
and she says the hospital assessment is no different.

“All one must to do is read Prop 108 to see that it doesn’t apply to the
provider assessment in the Medicaid restoration law,” spokesman Andrew Wilder
said in an email. “There are countless examples where agencies have been given
fee authority — in fact, the legislature’s granted it over 80 times in the last
five years.”

Senate President Andy Biggs, one of the lawmakers suing, said the issue has
never been litigated and the earlier fees were smaller.

“I’d be interested to find any other delegation of duty that is so large and
has such a broad impact as this delegation,” Biggs said.

Brewer, a Republican, shocked many in January by embracing Medicaid
expansion, a key part of President Barack Obama’s health care overhaul law. She
opposed the law and fought it to the Supreme Court, but then changed her mind
after it was upheld and Obama was re-elected. The high court gave states the
right to reject Medicaid expansion, but Brewer said doing so in Arizona would
hurt poor Arizonans and hospitals and caregivers who now must give care without

A date for a first hearing on the lawsuit hasn’t been set. The suit seeks an
order blocking the assessment and declaring it unconstitutional.


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