Health Care Exchange not in Michigan’s Best Interests

November 15, 2012

Dear Lawmaker:

On behalf of our 80,000 activists, Americans for Prosperity-Michigan urges you to oppose all efforts to create a so-called state based health care exchange. The President’s health care law allows, but does not require, states to set up an exchange.

A health care exchange will result in long-term unfunded liabilities for Michigan taxpayers and facilitate the Washington health care takeover in what the Cato Institute has deemed a “mirage” of local control.

Proponents of a state exchange claim it is necessary to preserve local flexibility and control. However, if Michigan chooses to set up an exchange it must agree to comply with the numerous regulations contained in the 2,700-page Patient Protection and Affordable Care Act, not to mention the thousands of pages of amendments and “guidance” the federal government issues in the process of implementing the law. In March, the U.S. Department of Health and Human Services (HHS) published its most recent portion of the exchange rules in a document totaling 644 pages.

The facts point to one sad conclusion. Michigan has lost control of its health insurance. Scrambling to set up an exchange cannot undo the federal government’s takeover of our system. The feds already have the power to completely commandeer Michigan’s exchange if they determine the state is not “substantially enforcing” federal standards and related provisions.

Aside from the issue of federal control, questions remain over how much a health care exchange will cost Michigan and who will pay for it. Federal grant money aimed at helping states get their exchanges up and running dries up in 2015. And when the federal money runs out, state taxpayers will foot the bill for operational costs. The Cato Institute estimates exchanges will cost states between $10-$100 million per year to operate. Many states have rejected the idea and Michigan should too.

Sincerely,

Scott Hagerstrom
State Director
Americans for Prosperity-Michigan

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