Obamacare Is Still Vulnerable

Townhall.com ^ | November 11, 2012 | Michael F. Cannon

[Kaslin]

President Obama has won reelection, and his administration has asked state officials to decide by Friday, November 16, whether their state will create one of Obamacare's health-insurance "exchanges." States also have to decide whether to implement the law's massive expansion of Medicaid. The correct answer to both questions remains a resounding no.

State-created exchanges mean higher taxes, fewer jobs, and less protection of religious freedom. States are better off defaulting to a federal exchange. The Medicaid expansion is likewise too costly and risky a proposition. Republican Governors Association chairman Bob McDonnell (R.,Va.) agrees, and has announced that Virginia will implement neither provision.

There are many arguments against creating exchanges.

First, states are under no obligation to create one.

Second, operating an Obamacare exchange would be illegal in 14 states. Alabama, Arizona, Georgia, Idaho, Indiana, Kansas, Louisiana, Missouri, Montana, Ohio, Oklahoma, Tennessee, Utah, and Virginia have enacted either statutes or constitutional amendments (or both) forbidding state employees to participate in an essential exchange function: implementing Obamacare's individual and employer mandates.

Third, each exchange would cost its state an estimated $10 million to $100 million per year, necessitating tax increases.

Fourth, the November 16 deadline is no more real than the "deadlines" for implementing REAL ID, which have been pushed back repeatedly since 2008.

Fifth, states can always create an exchange later if they choose.

Sixth, a state-created exchange is not a state-controlled exchange. All exchanges will be controlled by Washington.

Seventh, Congress authorized no funds for federal "fallback" exchanges. So Washington may not be able to impose Exchanges on states at all.

Eighth, the Obama administration has yet to provide crucial information that states need before they can make an informed decision. .author_pub2 a { float:right; margin: 10px 0 8px 8px; display:block; height: 142px; width: 110px; background: url(/people/pub_photos/cannon.jpg) no-repeat -110px 0; } .author_pub2a a { float:right; margin: 10px 0 8px 8px; display:block; height: 142px; width: 110px; background: url(/people/pub_photos/cannon.jpg) no-repeat 0 0; }

Michael F. Cannon is director of health policy studies at the Cato Institute and coauthor of Healthy Competition: What's Holding Back Health Care and How to Free It.

More by Michael F. Cannon

Ninth, creating an exchange sets state officials up to take the blame when Obamacare increases insurance premiums and denies care to the sick. State officials won't want their names on this disastrous mess.

Tenth, creating an exchange would be assisting in the creation of a "public option" that would drive domestic health-insurance carriers out of business through unfair competition.

Eleventh, Obamacare remains unpopular. The latest Kaiser Family Foundation poll found that only 38 percent of the public supports it.

Twelfth, defaulting to a federal exchange exempts a state's employers from the employer mandate — a tax of $2,000 per worker per year (the tax applies to companies with more than 59 employees, but for such companies that tax applies after the 30th employee, not the 59th). If all states did so, that would exempt 18 million Americans from the individual mandate's tax of $2,085 per family of four. Avoiding those taxes improves a state's prospects for job creation, and protects the conscience rights of employers and individuals whom the Obama administration is forcing to purchase contraceptives coverage.

Finally, rejecting an exchange reduces the federal deficit. Obamacare offers its deficit-financed subsidies to private health insurers only through state-created exchanges. If all states declined, federal deficits would fall by roughly $700 billion over ten years.

For similar reasons, states should decline to implement Obamacare's Medicaid expansion. The Supreme Court gave states that option. All states should exercise it.

Medicaid is rife with waste and fraud. It increases the cost of private health care and insurance, crowds out private health insurance and long-term-care insurance, and discourages enrollees from climbing the economic ladder. There is scant reliable evidence that Medicaid improves health outcomes, and no evidence that it is a cost-effective way of doing so.

My colleague Jagadeesh Gokhale estimates that expanding Medicaid will cost individual states up to $53 billion over the first ten years. That's before an emboldened President Obama follows through on his threats to shift more Medicaid costs to states.

Neither the states nor the federal government have the money to expand Medicaid. If all states politely decline, federal deficits will shrink by another $900 billion.

Now is not the time to go wobbly. Obamacare is still harmful and still unpopular. The presidential election was hardly a referendum, as it pitted the first person to enact Obamacare against the second person to enact it. Since the election, many state officials are reaffirming their opposition to both implementing exchanges and expanding Medicaid.

If enough states do so, Congress will have no choice but to reopen Obamacare. With a GOP-controlled House, opponents will be in a much stronger position than they were when this harmful law was enacted.

This article appeared in National Review (Online) on November 9, 2012.

[texson66]

Time for the States to stand up against the Imperial Federal Government and its goons.

[muawiyah]

it's actually time to start taking your own personal medical problems to your Democrat Senators and Democrat Representatives.

Seriously folks, it doesn't take much more correspondence to utterly collapse their correspondence and constituent service units.

The Republican House controls the budget, and the funding for such matters are in their purview so a serious public uprising using 'soft weapons' would be quite effective ~ just don't bother the Republicans with this attack.

[xkaydet65]

While true, these actions require cooperation and backbone by the state govts in the face of what will be enormous federal and media pushback. However another road is open and we see cutbacks in workers and/or full time employees are starting to occur and could cascade into the marketplace.If there is no employer insurance and there are limited state exchanges then all will be dumped on the Feds causing chaos. The Obama people actually hoped the private sector would just go along and there’d be no need for govt exchanges because they know how difficult they will be to manage. Think healthcare provided by the same people who gave Long Islanders LIPA. But all this will take courage, patience, forebearance, and willingness to cooperate across states and the marketplace. I don’t know any one or group that could organize this.

[lilypad]

The article states 38% of the population opposes the bill..then how the hell did Obama get reelected? Something is not adding up here.

[Eye of Unk]

If we are willing to die to save and protect our country then who needs Obamacare?

Why bother wasting you meager wages on a healthcare plan if we are TRULY dedicated to laying down our lives for our future.

[lilypad]

I meant supports the bill not opposes. Sorry,

[Kaslin]

Very well said

[Kaslin]

Voter fraud?

[Gorilla44]

Just one year ago, Ohioans voted overwhelmingly (66%)for a state constitutional amendment rejecting the federal mandate. All 88 counties voted for the amendment, including Cuyahoga (Cleveland) 58 to 42. Amazing.

[vette6387]

Nice Kaslin, very nice! I thought that FR was a place to exchange ideas! John Boehner is a disgrace! At least that’s how I see it. You are entitled to your opinion, but why not let us in on what you think rather than use one word invectives against ideas with which you disagree.

[Vaduz]

Higher taxes, fewer jobs, and less protection and he gets reelected,I didn’t know this country had that many idiots in it.
At some point they will find that even the gov tit dries up.

[Georgia Girl 2]

Obamacare was created by a bunch of morons so who is suprised to find out that it won’t work? It was always unworkable. It will collapse under its own weight as half the states can’t afford to implement it and others just don’t want to. In time it will take care of itself.

Ask yourself how many millions of americans will just not bother to sign up for Obamacare. There’s not much they can really do to you. Twenty something’s could care less about a fine. They won’t pay it. Who in their right mind is going to give the IRS access to draft money out of their bank account? I would never do that in a million years.

[Alberta's Child]

Whenever I read about Obamacare and all of these idiotic complexities, I can't help but think about the wisdom of former Soviet dissident Aleksandr Solzhenitsyn. After he had his citizenship stripped and he was exiled to the U.S. in the early 1970s, he gave an interview in which he described the ambivalence he felt about that turn of events. I'm going to paraphrase a remarkable comment he made as best I remember it (the emphasis is mine):

"Losing my citizenship in a nation that has no moral right to exist does not bother me. The Soviet Union didn't even exist 100 years ago, and it may even cease to exist before I die."

[DelphiUser]

There is an aspect of this people seem to be overlooking. Obamacare is not about “health” and it’s not about “care” it’s about control. The taxes, IRS access to all bank accounts, all the other pieces that when put together, mean no freedom. Do you honestly think they “care” if you get help? Stopping the “care” portion does not stop the regulation and that is why they wanted the bill in the first place, and why they pulled out all the stops to re-elect the man who passed it. Which is why they support and cover up for him, so the regulations would not be repealed.

Sorry, been a bit depressed since the presstitutes got their guy...

Delph

[WVKayaker]

Who in their right mind is going to give the IRS access to draft money out of their bank account? I would never do that in a million years.

I don't think that is a CHOICE!

IRS already takes people's money without recourse and most times, without notice!

[VRWCRick]

Agreed!! I say use every weakness found in this disastrous legislation to undermine and destroy it. Let’s turn Alinsky’s rules against them this time!!