On November 14, the U.S. Supreme Court granted review of the 26-state lawsuit against the President’s healthcare law, the Patient Protection and Affordable Care Act. The Court granted 5 ½ hours for oral argument, including 2 hours of argument on the individual mandate and 1 ½ hours on severability, which addresses whether, in the event the mandate is found unconstitutional, the entire Act must be stricken as well.
States must protect the health care freedom of their citizens by saying no to federal health insurance exchanges
The severability issue is a critical consideration for the states that are suing over the law’s constitutionality while at the same time moving forward with implementing other parts of the law, specifically the law’s health insurance exchanges. This undermines the idea that if the mandate is found unconstitutional the whole law must be thrown out.
The Obama Administration argues in its legal briefs defending PPACA that the establishment of health insurance exchanges are critical to enforcing the individual mandate, a sentiment echoed by the New York Times, which wrote that the “success of President Obama’s health care overhaul . . . depends on the creation of . . . health insurance exchanges.” The Obama Administration has maintained that the mandate is closely linked to the guaranteed issue and community ratings provisions, and that they must also go if the mandate is found unconstitutional. The Goldwater Institute argued in its lawsuit challenging the Act that the establishment of health insurance exchanges and increases in Medicaid eligibility are also linked to the Act’s overall reform scheme and that the entire Act must be stricken.
Despite this, some states that are part of the 26-state lawsuit pending before the Supreme Court,
including Arizona, are at the same time moving forward with establishing PPACA insurance exchanges. As a result, the legislatures in these states may find themselves on the front lines in protecting their states from this unconstitutional law. For the 13 states with Health Care Freedom Acts enacted in their constitutions or statutes, the legislatures may need to act to protect their citizens’ right to healthcare choice by stopping their states from becoming complicit with the very law they are seeking to strike down.
Whether state- or federally established, health insurance exchanges are government-sanctioned cartels where only government-approved insurers can sell only government-approved insurance. While proponents claim that states should establish an exchange in order to fend off a federally established one and preserve state control, a review of the law and proposed regulations reveals that establishing an exchange will accomplish none of these objectives. Following are select provisions of the law and the proposed regulations that show the extent of federal control over the exchanges. These provisions show that states will not be able to maintain any meaningful control or “flexibility” by establishing an exchange. Likewise, they show that any state that establishes an exchange will be enforcing the individual mandate and infringing on their citizens’ rights to choose the health care and insurance that best suits their needs.