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Welcome to ObamaCare Part IX: Exchange Flexibility? What Flexibility?

March 13, 2012 J

Yesterday, the Department of Health and Human Services (HHS) released its final rule governing the creation and operation of health care exchanges, a key component of the President’s health care law. As Americans for Prosperity has written on multiple occasions, we do not support the efforts by states to serve as the administrative arm of the federal government by creating an exchange.

Upon releasing the 644 page regulation, with hundreds of pages more to come, Secretary Kathleen Sebelius said “these policies give states the flexibility they need to design an Exchange that works for them.” But after reading the regulation, Americans for Prosperity asks “Flexibility? What Flexibility?”

Any state hoping to create an exchange must first apply to HHS using their “exchange blueprint” template. Secretary Sebelius has sole authority to approve or deny the application. Additionally, any “significant change” must also be approved by the Secretary.

The rule uses the word “must” over 1,000 times and the word “require” more than 320 times.  It also tells states what insurance plans will look like and what benefits they must cover; removing power from states.  HHS’s rule gets so specific as to dictate what items a state must include on its exchange website and how its call center must operate. How much flexibility does a state truly have when all decisions must be approved by Washington?

Additionally, the rule itself says that the “minimum functions…are a floor not a ceiling.” States only have the option to further concentrate control in the hands of bureaucrats, not keep it where it should be, between patients and doctors.  Even worse, HHS requires that states hire “navigators” with their own funds to shamelessly promote the so-called benefits of exchanges to individuals.  ObamaCare’s primary architect, economist Jonathan Gruber, confirms that premiums will go up for individuals in the exchanges. 

If even after all of this a state wanted to comply with the federal government’s request to create an exchange, time is running out.  Exchanges must be certified by Secretary Sebelius in a little more than nine months, on January 1, 2013, creating a logistical nightmare.   States must comply with all of HHS’s regulations while building a web portal that allows individuals to shop and apply; interfaces with various government agencies like the Internal Revenue Service, Medicaid and the Social Security Administration; and allows insurers to market their products. This is a formidable task that even the federal government isn’t sure it can accomplish.

Given the thousands of pages of regulation and lack of state flexibility, AFP continues to urge states not to implement Obama’s health care exchanges.
For more information on health care exchanges visit www.AmericanHealthCareFreedom.com

Check out previous posts in the “Welcome to ObamaCare” series by clicking below:

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