AFP Opposes Health Care Exchanges as False Choice for States

August 19, 2011

AFP has just submitted official comments to HHS on the first major round of health care insurance exchange regulations issued under the President’s new health care law. The regulations from HHS lack any meaningful flexibility for states to control their exchanges, which is critical to maintaining the quality and availability of health care coverage.

In our comments, AFP focused on three major flaws in the regulations: lack of flexibility, threats to the privacy of patients’ information and whether HHS has committed a regulatory taking by mandating insurers disclose patient data.

* AFP Comments on Establishment of Exchanges

We discuss the lack of state flexibility, restrictive timeline, federalist concerns, undue access to patient information, “approved” coverage shortages and lack of competition-induced downward cost pressure, all of which this proposed rule threatens to bring about.

* AFP Comments on Standards Related to Risk Adjustment, Risk Corridors and Reinsurance

We discuss both the content and method of data transfers from the private to public sector. We also explore the Takings Clause implications of a federal agency mandating the disclosure of proprietary information to be used as an economic weapon against the insurer for the purpose of risk adjustment.

The implementation of the new health care law is at a pivotal stage. Several states are recoiling at the onerous mandates and regulations HHS is issuing under the new law; some are returning federal money in order to avoid coercive control while others are flat out refusing to implement the law in order to avoid complicity in the looming market disruptions.

In our comments, AFP urges HHS to reform these exchange regulations before they are made final. We further urge grassroots activists across the country to reach out to their governors and state legislators and tell them not to implement these exchanges.

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