How Medicaid is affected by the ruling

>>> while the mandate is the headlines today , the supreme court decision also upheld the law's medicaid expansion. the law expands medicaid to about 17 million more americans in ten years. the issue was if the law infringed on states ' rights and spending powers by attaching conditions to federal grants . the court's final say is that the law can withhold some but not all medicaid funds if a state does not agree to expansion. so what does that mean? good thing we have dr. donald berwick. let me see if i get this straight, i know this is wheel house for you, so we're going to start here. so states can agree to expand their medicaid coverage in order to receive federal funding . if they do accept federal funding , they have to adhere to the rules in the bill. and they can also refuse the funds now and the expansion, but they get to keep their existing medicare -- medicaid funding, right?

>> yes. that's right. under the medicaid law of 1965 , states could choose to be in medicaid or not, all eventually chose to be in medicaid , but they can set the eligibility limit, so one state could say you're eligible below 50% of the &qa=y qe?line, other states 100% of the poverty line , there's a lot of variation, and the government shares in the cost, cost, the new law says that everybody will be covered cut huff is $31,000. the difference is 100% federal dollars for three years and then it falls to 90% federal dollars so it averages out to the new people it's federal. the state can stay out of that expansion. they can keep their medicaid program and not participate in the expansion if they choose to do that.

>> let me follow up on that, because it seems to me there's been this movement, where you have states , particularly in the south where you have republican governors, republican legislatures and just generally speaking very conservative state where is they are moving as far and as fast away from the federal government as possible. is there a scenario here where we basically have two americas, sort of a blue state america, in red state america where there isn't?

>> i don't think that's likely, if you l let's say you're a state that's set its medicaid coverage at 50% of the poverty limit. 95% to major all, you can expand. if you choose to stay out of that, what happens? those people are still living in your state , they're still poor, they're going ? to come to your emergency room , they're going to be operated on and they're going to have diseases that get worse and you're going to have to pay for that, and that will come from the state , free care pools and charity in the state . i think what's going to happen is, the states are now, all states are going to be under pressure from providers to say why are you leaving this money on the table? let's join with the federal dolla dollars because these patients are going to -- it may take a little longer now that there's no loss of the medicaid program but i think the states are going to come to their senses and they're going to be encouraged to do that by providers.

>> in an interview you did recently with the guardian, you said the republicans who opposed the bill, quote, and we can put this on the screen, have concerns about rationing, about government takeover of the medicine, about the socialization of medicine, none of which were accurate and -- last week a top doctor in the uk at the university of kent told the royal society of medicine that the country's national health service kills off 130,000 elderly patients a year. isn't rationing inevitable when demand outpaces supply?

>> we have in this country, we're spending more than double most other western democracies, we have plenty of money in the health care system to give the care, all the care people want and need. we don't have to think about rationing, that's not on the table and those accusations are ridiculous in the american ? context. and we're not talking about a government takeover of care, i don't know where that idea came from. we still have private delivery of care, doctors and hospitals, we still have a robust private health care system . we have to put insurance companies on much better behaviors, so they don't take away your insurance if you get sick. private coverage has to cover prevention now because that makes a lot of sense. and if you're very, very poor, and there's no one else to pay for you, to the government will make sure you have access to care. that's not rationing, that's opposite of rationing.

>> illness and injury can happen to anybody at any time in their lives and it is a major reason why people go bankrupt or lose a lot of their wealth or the money that they have. we have a safety net now that's going to keep people from just losing a ton of their income because they didn't -- weren't able to plan for it with having proper health insurance .

>> how about their lives?

>> absolutely. well if you die, then you can't do anything about that. but when people are losing significant amounts of the money that they have in the bank because they couldn't work for months, years, what have you, couldn't pay these massive hospital bills, we're not going to have that anymore. and that in a country as rich as this, is an immoral and shameful thing.

>> i see health care as a human right. and that is a debate that we sort of skirted during the health care reform . i was listening to mitt romney 's statement today and i was having a little bit of flash back to the health care debate when he was talking about the federal ?and your health care , and these alleged $500 million cuts in medicare, all the old talking points coming back. i hope we're not going back to that particular part of the debate.

>> i think romney wants to move away from this debate as soon as possible. so i don't think you'll see him messing with that.

>>> up next, what the decision means for the 2012 presidential politics . we'll bring in the political man mark murray as we do on "the cycle."