Document Type


Publication Date



The Supreme Court’s decision in National Federation of Independent Business v. Sebelius regarding the constitutionality of the Patient Protection and Affordable Care Act produced three main holdings concerning two critical provisions of the Act. The first two holdings concerned the “individual mandate” that requires most Americans to maintain “minimum essential” health insurance. The third holding concerned “the Medicaid expansion,” which expanded the class of persons to whom the states must provide Medicaid coverage as a condition for receiving federal funds under the Medicaid program. By a vote of 7-2, the Court struck down this provision as an impermissible condition on the provision of federal funds to the states. Many commentators have opined that, of these three holdings, the third — concerning what is often called Congress’s “conditional spending power” — is apt to have the most far-reaching consequences beyond health care. Unfortunately, this third holding is not only the most potentially significant, but also the one supported by the least clear rationale. At first blush, the majority appeared to hold straightforwardly that the conditional offer that the Medicaid expansion embodied was unconstitutional because coercive, and coercive because it gave states “no choice” but to accept. For several reasons, however, that initial reading appears cloudier on a second or third read. Given the vast potential significance of the Court’s holding on conditional spending and the manifest lack of clarity regarding its rationale, this essay offers a comprehensive and critical assessment. Very generally, the essay does five things: (1) disambiguates the concepts of coercion and compulsion; (2) shows that, under the label "coercion," the Supreme Court majority in National Federation of Independent Business actually deployed the concept of compulsion; (3) argues, against the majority, that compulsion is not a normatively meaningful concept and that coercion is; (4) explains how a threat to withhold benefits that the government is not obligated to provide can be unconstitutional by amounting to a penalty; and (5) argues (tentatively) that the Medicaid expansion probably did threaten a penalty and thus probably did constitute the wrong of coercion. Points (3) and (4) in particular bear profound implications for understanding “unconstitutional conditions” cases even outside the context of federal conditional spending.


unconstitutional conditions, conditional offers, coercion, compulsion, Medicaid, health care, Obamacare, conditional spending

Publication Title

Texas Law Review

Publication Citation

91 Tex. L. Rev. 1283 (2013)