States Can't Have It Both Ways on Exchanges

Some state lawmakers committed to striking down the federal takeover of health care – the Patient Protection and Affordable Care Act (“PPACA”) – have moved forward with establishing PPACA insurance exchanges at the same time the United States Supreme Court will be deciding the law’s fate.

Why? The answer we have heard over and over again is that they are establishing PPACA exchanges in their states in order to preserve state control and flexibility over the exchange. However, this answer is refuted by a review of the law.

The President’s health care law says it all: “An Exchange may not establish rules that conflict with or prevent the application of regulations promulgated by the Secretary under this subtitle.” The very language of PPACA makes clear that any so-called state control or flexibility the states think they have is at the mercy of the federal government.

It’s sort of like a retractable leash. You can walk your dog on such a leash and give them some slack to run around, but ultimately, you can pull your dog in at any moment.

Likewise, with PPACA exchanges, as long as the president and his officials are holding the exchange leash, Arizona and other states establishing state exchanges will leave their sovereignty and the liberty of their citizens at the mercy of the federal government.

It makes no sense for a state that is part of the multi-state lawsuit challenging PPACA that is currently before the Supreme Court to both oppose the statute and enforce it at the same time. But beyond being contradictory, PPACA exchanges are detrimental to the fight against the law enabling them. Over the last several weeks court briefs supporting PPACA specifically cite the fact that states are moving forward with exchanges as evidence that exchanges can survive with or without the law’s mandate that all Americans buy insurance.

With oral arguments scheduled in the Supreme Court in late March and a decision expected in June, it is not too late for states like Arizona to reverse course, as Wisconsin did last month, by sending back the federal exchange grant money they have received and stop exchange implementation activities.

Learn more:

Goldwater Institute: States must protect the health care freedom of their citizens by saying no to federal health insurance exchanges