State Director Brad Stevens Testimony to Governor Heineman Opposing State Insurance Exchanges
AFP Statement of Opposition to State Health Insurance Exchanges
Governor Heineman, thank you for the opportunity to speak on this important issue.
Let me start by making an important distinction: a health exchange in a free market system could be a positive thing. It could provide customers with access to better information to make price comparisons and improved purchasing options.
Unfortunately, we do not have a free market system under the President’s health care law. This is a top-down system where the federal Department of Health and Human Services will retain all important decision making rights. It is incorrect to argue that an exchange will give Nebraska autonomy or flexibility when the decision rights are retained by Washington.
Worse, a Nebraska-run exchange is a myth; it would be state-run in name only. Currently the Office of Information and Regulatory Affairs is reviewing multiple proposed rules governing state exchanges that are deemed ‘economically significant’. And there are many more rules waiting to be reviewed. Agreeing to implement an exchange would be putting blind faith into the Obama Administration on this issue, and I do not believe Nebraskans support that.
I recently attended a workshop on Exchanges by the state Department of Insurance. I was impressed with DOI’s level of professionalism and knowledge of the issue. Throughout the presentation the phrase ‘we do not yet have guidance from the feds’ was repeated at least a dozen times. This experience of studying implementation of a state exchange has proven only one thing: while Nebraska moves forward in good faith the federal government is not a competent partner.
The federal government does not know how to implement the new law. President Obama’s health care law is unprecedented in its size, cost and scope. Implementing a state exchange would be state government offering to do the heavy lifting while the federal bureaucracy retains power. That’s a bad deal for Nebraska.
Furthermore, no one at this point can tell us how much implementing an exchange will cost Nebraska taxpayers. Cost estimates for other states have already reached into the hundreds of millions. Some analysists predict states would need to increase taxes up to $100 million annually just to cover operating costs.
It has been said that the federal health care law represents the largest non-defense related IT effort in the history of the nation. The costs of implementing the Affordable Care Act will only become more expensive as the law is encumbered with more regulation. Speaker Pelosi was absolutely right when she said we needed to pass the bill to know what was in it because the real meat, and the real cost of this law, is found in the continually growing pages of bureaucratic regulation.
No one at this point can look Nebraskans in the eye and say this is how much operating a state exchange will cost. And no one knows how much that figure will grow in 5, 10, 20 years. Nebraskans overwhelmingly opposed the Affordable Care Act and overwhelmingly support its full repeal. It would be the absolute wrong direction for state government to participate in implementing a law Nebraskans do not want. And it is irresponsible to implement a program when no one can tell us how much it will cost.
We appreciate the opportunity to express our reasoning for unequivocally opposing a state health insurance exchange under the Obama health care model.
Nebraska State Director
Americans for Prosperity