Chief Justice Roberts’ 2012 Ruling Should Undermine Work Requirements

The saying, “what goes around comes around,” might be surprisingly true for a key health provision in President Donald Trump’s One Big Beautiful Bill Act (OBBBA) that he signed on July 4, 2025. The provision mandates that states set work requirements for most of their adult Medicaid enrollees, a long-desired Republican policy goal. The surprise, though, involves a 2012 US Supreme Court decision regarding the Affordable Care Act (ACA) that may just have a fateful impact on work requirements.

The work requirements section in Trump’s OBBBA directs that, beginning in 2027, all states must drop from Medicaid enrollment any adults who do not work at least 80 hours per month and report their work activities accurately and regularly. All enrollees ages 19-64 (except parents with children under 14, pregnant women, and medically frail persons) will face disenrollment if they fail to work sufficient hours and show proof at least every six months.

Real-world experience with such mandates in Arkansas and Georgia shows that such obligations result in substantial coverage losses even among enrollees who work—more than 70% of Medicaid enrollees nationally are in households with at least one worker. The true purpose of the Act is to lower enrollment to offset the federal costs of tax cuts for the wealthy and corporations. The Congressional Budget Office estimated an increase in uninsurance of 4.8 million individuals by 2034 because of the requirement. No evidence suggests any impact from the mandate on promoting work.

Medicaid’s essential statutory purpose is to provide health insurance and medical care services to needy low-income Americans. In constructing the new work mandate that will undermine Medicaid’s core purpose, did Congressional Republicans neglect any key considerations? I think they missed something important and relevant.

On March 23, 2010, the same day President Barack Obama signed the ACA into law, a cohort of state Republican attorneys general filed a federal lawsuit to challenge the new law’s constitutionality. Key targets were the law’s individual mandate to require purchase of health insurance and its requirement that all states must expand Medicaid eligibility for Americans with incomes under 138% of the federal poverty line ($44,367 for a household of four in 2025).

The US Supreme Court released a complex and nuanced decision in late June 2012. While upholding the individual mandate, the majority also ruled that the Medicaid expansion as designed was unconstitutional and must be made an option for states rather than a mandate. The Medicaid ruling sent shockwaves that have lasted to this day as 10 states still refuse to expand, leaving 2-3 million poor Americans with no affordable coverage opportunity. Chief Justice John Roberts penned the majority decision. What was on his mind?

On behalf of the seven justices voting in the majority on this decision, Roberts wrote: “Congress may not simply ‘conscript State [agencies] into a national bureaucratic army,’ and that is what it is attempting to do with the Medicaid expansion.” In the Chief Justice’s view, the expansion was “economic dragooning that leaves the States with no real option but to acquiesce in the Medicaid expansion.” It was, in his opinion, a bridge too far.

So, according to Roberts, is any federal mandate on states unacceptable? No. Did the Roberts opinion define any limit or cliff where a mandate crosses into unconstitutional territory? No. “The Court … did not attempt to ‘fix the outermost line’ where persuasion gives way to coercion.’ We have no need to fix a line either. It is enough for today that wherever that line may be this statute [the ACA] is surely beyond it.”  

How did two different Congresses in 2010 and in 2025 structure their respective penalties on states that refuse to comply with their mandate, and what was each Congress’s “outermost line?” In the 2010 ACA, Congress gave the Secretary of Health and Human Services authority and discretion to impose sanctions, up to and including the withdrawal of all Medicaid funding to the rejecting state. In 2012, that was the line-too-far for the seven justices.

The 2025 OBBBA gives the Secretary of Health and Human Services authority and discretion to impose sanctions on states for noncompliance with work requirements, up to and including withdrawal of all Medicaid funding to the resisting state. According to OBBBA text: “Until he [HHS Secretary] is so satisfied, he shall make no further payments to such State (or shall limit payments to categories under parts of the State plan not affected by such failure).” (Sec. 1904. [42 U.S.C. 1396c])

Perhaps the dividing line involves the magnitude of financial consequences? Not according to the Chief Justice in 2012: “…the size of the new financial burden imposed on a State is irrelevant in analyzing whether your State has been coerced into accepting that burden. ‘Your money or your life’ is a coercive proposition, whether you have a single dollar in your pocket or $500.” 

To Roberts and the six other justices: The legitimacy of Congress’s exercise of this spending power “thus rests on whether the State voluntarily and knowingly accepts the terms of the ‘contract.’”

In short, no discernible difference exists between the ACA mandate penalty that was overturned and the mandate penalty in the 2025 OBBBA.

Between these 2010 and 2025 enactments, the details matter less than the reality of the broad new mandate on state governments and related penalties. In this case, the reality of the OBBBA is “the largest rollback of health insurance coverage in U.S. history,” with work requirements as the central policy instrument. Also, the work requirement mandate imposes a substantial and never-ending administrative burden on state governments.

It appears that the Republican crafters of the One Big Beautiful Bill Act repeated the error made by ACA crafters in 2010. The 2012 Roberts Rule on Medicaid had no meaningful precedent for its striking, and many precedents in its favor going back to the 1980s. The OBBBA crafters have no such excuse. Let’s hope that the Chief Justice’s memory is not short because what goes around, comes around, for sure.

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