Tag: insurance exchange

‘They’d Rather Be Caught Sacrificing to Satan Than Voting for Obamacare’

Michigan has become the latest to repudiate Obamacare:

In an action with major implications for health reform in Michigan, the state House has voted to turn down—at least for now—nearly $10 million in federal funds to create a statewide health exchange by 2014 to sell more affordable, standardized health insurance to consumers and small businesses.

The Michigan House’s action is consistent with what everyone from the American Legislative Exchange Council to the Heritage Foundation to the Cato Institute has recommended that states do: refuse to create an Exchange and send the money back to Washington.

Our friend Jack McHugh of the Mackinac Center for Public Policy writes:

Under the Michigan Constitution, no money can be spent by the state—including federal grant money—unless the Legislature passes an appropriation bill authorizing the spending…

House Republicans have shown no eagerness [to create a state Obamacare exchange], and that reluctance extended to this appropriation bill. In the colorful words of House Appropriations Chair Chuck Moss, R-Birmingham, to MIRS News, “They’d rather be caught sacrificing to Satan than voting for Obamacare, so that’s the way it is.”

Jonathan Adler and I explain in this Wall Street Journal oped how Michigan officials can protect Michigan employers (including the state government itself) from penalties under Obamacare’s employer mandate—and even help bring down the entire law—by refusing to create an Exchange.

Va. Gov. McDonnell (Sort of) Takes My Advice, Defers Creating ObamaCare Exchange

In June, I testified in Richmond before Virginia’s Joint Commission on Health Care that Virginia should refuse to create one of ObamaCare’s health insurance “exchanges”:

[ObamaCare’s] health insurance “Exchanges” are scheduled to become operational in 2014.  These new government bureaucracies would enforce the law’s regulations that will drive up health insurance premiums, and would distribute hundreds of billions of taxpayer dollars to private health insurance companies, thereby driving up the national debt…

Neither the Commonwealth nor the federal government has money to waste on new government agencies that might be repealed or overturned tomorrow…

At a minimum, Virginia should defer the question of creating an Exchange until the courts dispose of the constitutional challenges brought against this law.  Legal scholars expect the U.S. Supreme Court to rule on this law in the summer of 2012…If the Court voids the law, Virginia will be glad she waited.

Virginia Gov. Bob McDonnell (R) has inexplicably been gung-ho to create an ObamaCare Exchange. According to the Richmond Times-Dispatch, however, McDonnell may be modulating his tune:

McDonnell said he does not want to create an exchange legislatively until after the court makes its decision on the mandate’s constitutionality. The court will hear arguments in the case in March and possibly rule in July, just after a federal deadline for states to seek grant money to set up exchanges.

“Any major expense prior to the court decision is irresponsible and a waste of money,” the governor said at a luncheon meeting with members of the Capitol press corps.

Unfortunately, McDonnell is still laboring under the misapprehension that creating her own Exchange will let Virginia retain a measure of control over her health insurance markets:

McDonnell said he hopes the Supreme Court will strike down the law’s individual mandate, rendering an exchange unnecessary, but he made clear he wants Virginia to operate the exchange if the law stands.

“If we have to do it, I clearly want to have a state-based exchange,” he said.

To read about why Virginia doesn’t “have to do it,” and why there is no defensible rationale whatsoever for an ObamaCare opponent such as McDonnell to create an Exchange, read my Missouri testimony.

To learn how McDonnell may end up saving ObamaCare from repeal by creating an Exchange, read this Wall Street Journal oped by Jonathan Adler and me.

One Executive Order That Could Stop ObamaCare

A new memo from the Congressional Research Service explains that the next president cannot simply stop ObamaCare (“PPACA”) by executive order:

[A] president would not appear to be able to issue an executive order halting statutorily required programs or mandatory appropriations for a new grant or other program in PPACA, and there are a variety of different types of these programs. Such an executive order would likely conflict with an explicit congressional mandate and be viewed “incompatible with the express…will of Congress”…However, there may be instances where PPACA leaves discretion to the Secretary to take actions to implement a mandatory program, and…an executive order directing the Secretary to take particular actions may be analyzed as within or beyond the President’s powers to provide for the direction of the executive branch.

In other words, the worst elements of ObamaCare – the government price controls it imposes on health insurance, the individual mandate, and the new spending on health-insurance entitlements –  are “statutorily required programs” that, say, President Romney cannot repeal or even halt by executive order.

However, there is one executive order that could effectively block ObamaCare, and that lies well within the president’s powers.

The Obama administration has issued a proposed IRS rule that would offer “premium assistance” (a hybrid of tax credits and outlays) in health insurance “exchanges” created by the federal government. The only problem is, ObamaCare only authorizes these tax credits and outlays in “an Exchange established by the State.” The administration did so because without premium assistance, ObamaCare will collapse, at least in states that do not create their own Exchanges.  Yet the executive branch does not have the power to create new tax credits and outlays.  Only Congress does.  So if the final version of this IRS rule offers premium assistance in federal Exchanges, it will clearly exceed the authority that Congress and the Constitution have delegated to the executive branch.

In that case, the next president could issue an executive order directing the IRS either not to offer premium assistance in federal Exchanges or to rescind this rule and draft a new one that does not. The U.S. Constitution demands that the president “take Care that the Laws be faithfully executed.” Such an executive order therefore lies clearly within the president’s constitutional powers: it would ensure the faithful execution of the laws by preventing the executive from usurping Congress’ legislative powers.

While such an executive order would not repeal ObamaCare, as Jonathan Adler and I explain in this Wall Street Journal oped, it would “block much of ObamaCare’s spending and practically force Congress to reopen the law.”

A Potentially Fatal ObamaCare Glitch

In today’s Wall Street Journal, Jonathan Adler and I explain how a recently discovered glitch could be the undoing of ObamaCare:

ObamaCare authorizes premium assistance in state-run exchanges (Section 1311) but not federal ones (Section 1321). In other words, states that refuse to create an exchange can block much of ObamaCare’s spending and practically force Congress to reopen the law for revisions.

The Obama administration wants to avoid that legislative debacle, so this summer it proposed an IRS rule to offer premium assistance in all exchanges “whether established under section 1311 or 1321.” On Nov. 17 the IRS will hold a public hearing on that proposal…

Any employer whose employees receive premium assistance through a federal exchange…would have standing to challenge these illegal tax credits and outlays.

Public-interest lawyers could file suit as soon as the IRS rule becomes final and they find an employer that will be harmed. Any firm that doesn’t offer health benefits and that employs lots of full-time, low-skilled, young workers in a state that fails to create an exchange should suffice. A successful challenge would block the law’s employer mandate in that state.

In addition, under the Congressional Review Act, a simple (filibuster-proof) majority vote in each chamber of Congress could send to President Obama’s desk a resolution blocking this IRS rule. Even if Mr. Obama vetoed the resolution (taking personal responsibility for this assault on the rule of law), a future president could still rescind the rule.

According to the IRS notice, the public hearing will take place tomorrow, Thursday, November 17, “at 10 a.m., in the auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW., Washington, DC. Due to building security procedures, visitors must enter at the Constitution Avenue entrance. All visitors must present photo identification to enter the building.” Those interested should consult the IRS notice (p. 50938) for more information.

North Dakota Rejects ObamaCare ‘Exchange’

Here’s the story, from the Bismarck Tribune:

Angered by a federal health care law that most of them despise, North Dakota House Republicans defeated legislation Thursday to give state officials authority over a health insurance marketing agency that the law requires states to establish.

(Correction: ObamaCare does not require states to create an Exchange.)

They said endorsing state administration of the agency, which is called a health insurance exchange, would be tantamount to approving the federal health reform law itself.

“I certainly am not going to legitimize Obamacare with my vote,” said Rep. Wes Belter, R-Fargo. “We, as a state of North Dakota, need to follow some of the other states who have said no… It is the law, but the fight should not be over.”

Supporters … said Thursday’s vote was the state’s last realistic chance for running its own exchange, since deadlines are looming and the Legislature does not meet again until January 2013…

After a debate that lasted almost two hours, representatives voted 64-30 late Thursday to reject the legislation. All but 10 of the House’s 69 Republicans voted against the bill, while 20 of its 25 Democrats supported it…

Opponents of the bill said they resented the pressure, which they said was caused by unrealistic deadlines in the federal health care law.

Rep. Keith Kempenich, R-Bowman, compared the situation to high-pressure sales tactics in a used car lot.

“If the federal government was really sincere on trying to reform health care, they wouldn’t have put these artificial dates in,” Kempenich said. “Whenever I’ve seen things that get rushed like this, or they get where you’re pressured like this, usually, they’re full of it, and that’s what this is starting to look like.”

Kudos to the North Dakota Policy Council’s Brett Narloch.

Heritage Scholar Urges States: Don’t Implement ObamaCare Exchanges, Send Back Grants

Back in March, Heritage Foundation scholar Ed Haislmaier wrote that states could blunt ObamaCare’s impact (A) by creating non-ObamaCare compliant, “consumer-centered” Exchanges and/or (B) by creating ObamaCare-compliant, “defensive” health insurance Exchanges.  Many states, including some that are suing to overturn ObamaCare as unconstitutional, saw this as a green-light from the free-market groups and forged ahead with creating an ObamaCare-compliant Exchange.

In a blog post last week, Haislmaier recanted on Strategy B.  He writes that “defensive” Exchanges won’t blunt the impact after all, and that states should refuse to create any type of ObamaCare-compliant Exchange and send back all federal ObamaCare grants:

Initially, while HHS was still deciding how to implement the legislation, a narrow window of opportunity existed for states to pursue a “pushback” strategy of creating a restricted exchange and requiring it to contract with the state’s Medicaid program and insurance department to perform the eligibility, enrollment, and insurance regulation functions that state lawmakers seek to retain control of. HHS effectively closed that window in its proposed exchange regulations issued in July…

The combined effect of these regulations and grant requirements are that a state would have to agree to surrender any last vestiges of meaningful control over how Obamacare is implemented. Thus, a state would now have no more real control over an exchange it set up than over one HHS established

Consequently, at this point the best course of action for states is to neither apply for nor accept exchange establishment grant funding.

Free-market groups are now united on these points.

Haislmaier still recommends that states pursue  Strategy A: a “consumer-centered,” non-ObamaCare Exchange using only state-government dollars.  As I explain here, however, there is no such thing as a non-ObamaCare Exchange.  Insurance carriers will not patronize non-ObamaCare Exchanges, and the federal government will commandeer them or push them aside to create an ObamaCare Exchange.  Creating any type of Exchange merely lends manpower to ObamaCare’s federal takeover of health care.  States should refuse.

ObamaCare: a Federal Takeover, No Matter Who Runs the Exchanges

Merrill Goozner read my article in the March 21 National Review, in which I argue that states should refuse all ObamaCare funds and refuse to erect an ObamaCare Exchange that would execute the law’s many health-insurance regulations. Since ObamaCare provides that the feds will set up and administer an Exchange in states that don’t do so themselves, Goozner concludes that I’m actually advocating a federal takeover of health care. Really?

Goozner either completely missed the point of my article, which I sort of doubt, or he’s trying to be cute.  Let’s assume it’s the former.

As I explain in that article, under ObamaCare the feds will write all the rules governing health insurance, so who administers the Exchanges is well-nigh irrelevant. ObamaCare is a federal takeover of health care, no matter who runs these new government bureaucracies that we call health insurance Exchanges.

Then again, there is reason to suspect that Goozner is just trying to be cute. ObamaCare apologists know that if states stop implementing the law, it will be easier for Congress to repeal it or for the Supreme Court to strike it down.  They know that if states don’t set up their own Exchanges, HHS may not be able to set them up itself, which would jeopardize the federal government’s ability to start doling out ObamaCare’s hundreds of billions of dollars in new debt-financed entitlement spending in 2014.  So it makes sense to attack or ridicule me for suggesting that states should obstruct ObamaCare because he suspects that could bring the whole miserable operation down.  But surely Goozner can come up with something more plausible than  suggesting that I’m advocating a federal takeover of health care.