One of the most important issues facing states this legislative session is whether to create a health care exchange to implement the president’s health care law. States are being tempted by words like “flexibility” and very large grants from the Department of Health and Human Services (HHS) to gain their compliance, but states that value health care freedom should resist and refuse to implement Obama’s health care exchanges.

Health care exchanges organized voluntarily by market participants are something that conservatives could support. Exchanges should function as a free-market mechanism allowing consumers to make informed health care purchasing decisions in a simple, innovative and transparent manner. Yet, the exchanges as created by Obamacare and HHS fail to meet this most basic standard.

These exchanges pile thousands of pages of rules, regulations and mandates on each state’s insurance markets, harming competition and consumers. Forcing insurers to provide “essential health benefits” under “qualified health plans” with little to no cost-sharing does nothing but raise premiums, a fact even acknowledged by Obamacare’s chief architect, economist Jonathan Gruber. According to a study of the Wisconsin insurance market authored by Gruber, Obamacare will push up individual premiums by an average of 30% in the Badger State.

Conservative proponents of state exchange creation, like David Merritt here at The Daily Caller, argue that states will have “flexibility” if they create exchanges themselves. A review of the facts show this statement doesn’t pass the laugh test.

The Obama Administration plans to force active duty service members and veterans off the military’s current health care plan, Tricare, and into ObamaCare’s state-run healthcare exchanges by increasing Tricare premiums between 30 percent to 78 percent the first year and a crushing 94 percent to 345 percent every five years thereafter.

By squeezing service members and veterans out of Tricare and into ObamaCare through significantly higher Tricare premiums, the Obama Administration believes it can pinch $1.8 billion from Tricare in fiscal 2013 and $12.9 billion by 2017.

By comparison, Mr. Obama spent $20.5 billion on his Department of Energy green energy grants and loans program, 80 percent of which went to companies owned or tied to Mr. Obama’s top fundraisers.

Ilya Shapiro, of the CATO Institute, has a fantastic article published at The Daily Caller about President Obama's Top 10 Constitutional violations. On that list, are four instances related to Obamacare, including:

1. The Individual Mandate
2. ObamaCare's Medicaid Coercion
3. ObamaCare's IPAB - Independent Payment Advisory Board
4. Waivers issues by HHS

Read Shapiro's full article here.

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In 2003, Congress passed the Medicare Modernization Act (MMA) which created Medicare's Part D (prescription drug program). As part of the law, Congress also created a chronic care improvement program (see Section 721). The New England Journal of Medicine (subscription needed) published an article earlier this month reporting the results of the study. The abstract includes the following:

"The eight commercial disease-management programs did not reduce hospital admissions or emergency room visits, as compared with usual care. We observed only 14 significant improvements in process-of-care measures out of 40 comparisons. These modest improvements came at substantial cost to the Medicare program in fees paid to the disease-management companies ($400 million), with no demonstrable savings in Medicare expenditures." 

Thus proving that more bureaucracy cannot curb costs or improve results. Early reports to CMS in June 2007 reached similar conclusions, which begs the question: "How much of the $400 million total that Medicare paid out was paid after July 27 - and thus was a waste of federal tax dollars?"  See the June 2007 report to CMS, here.

(EDITORS NOTE: Section 721 was included in the bill considered by the Republican Majority in the House of Representatives).

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Jonathan H. Adler and Michael F. Cannon write in today's Wall Street Journal about one of ObamaCare's fatal flaws (a flaw that, thankfully, undermines much of the law). As AHEC as previously explained, ObamaCare requires states to set up insurance exchanges to regulate the sale of health insurance (and which will likely lead to a one-size-fits-all insurance policy where consumers have fewer choices and, with fewer choices, consumers will see more expensive insurance). The ObamaCare subsidies will be given to qualified people who obtain insurance through the government exchanges.  

Here is the flaw in ObamaCare. Individuals who buy insurance outside of the exchange will not be eligible for the subsidies.  So what happens if you were to price shop and find a more affordable policy that is not offered through an exchange? You pay 100% of the cost yourself - no subsidy. What happens if your state does not create an exchange and the federal government sets one up in your state? According to Adler and Cannon - the same thing. No one who buys insurance through a federal exchange is eligible for the subsidy. This is just another reason that ObamaCare was poorly conceived, poorly designed, poorly written and is and will be poorly implemented. Congress should scrap the law and start over - something this badly broken simply can not be fixed.

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For some inexplicable reason, the Health Care Compact Alliance (HCCA) continues to be a cheerleader for socialized medicine. The HCCA recently posted on its website that: "Vermont’s [system of socialized medicine] represents one of the many ways coverage can be provided as states assume responsibility for their citizens’ health care, the chief goal of the Health Care Compact Alliance (HCCA)." 

In other words, the HCCA has statist goals: promoting state government power over health care instead of individual choice and personal control. This also clearly states that the compact is not inconsistent with socialized medicine, an idea that should trouble any liberty-minded individual.

Back in March of this year, Vice-Chairmen of the HCCA, Leo Linbeck III also acknowledged that the compact and socialized-medicine were not at odds with each other, stating “If a state really wants to do a single-payer system, they should do it.” Linbeck also said “What it’s essentially saying is we’re not going to have a one-size-fits-all program any more." But his endorsement (or at least lack of repudiation) of socialized-medicine ignores the fact that a single-payer system is "one-size-fits-all," just on the state level.

And make no mistake about it, at its core, a single-payer system is at odds with individual liberty as embodied in the Constitution. This form of healthcare places government power ahead of individual liberty, allowing government, not free people or free markets, to determine the value of a physician's work through price controls. A single-payer system will enslave doctors, denying them the ability to be fairly compensated for their education, training and expertise. As a single-payer system takes root, it will lead to doctor shortages (price controls inevitably do), rationing of care, and the government deciding the relative worth of individuals in need of medical care - all of these will deny each American access to proper medical care.

Listen to what Ronald Reagan had to say about socialized medicine:

Much of the HCCA rhetoric speaks in terms of individual liberty versus federal government power but the clear messaging from the compact's advocates is that state government - not individuals - will have the power to make health care decisions. Accordingly, the HCCA is promoting government power and control not individual liberty. 

The appeal of the compact is that it appears to advance states' rights, a goal most conservatives would share. However, thinking conservatives support states' rights as merely a means to an end, the end being the defense and preservation of individual liberty. With respect to the compact, the HCCA holds up the means (states' rights) as the end to be served, losing sight altogether of freedom and liberty.  And the HCCA's repeated endorsement and/or acceptance of socialism proves that Linbeck and others at the HCCA hold no regard for the end that every American supports - personal freedom!      

Linbeck and others who support the compact fail to understand that socialism is an evil that will inevitably result in a denial of individual liberty. In this regard, the Health Care Compact is no different than ObamaCare. It is a misguided effort for those in government to gain power and control over our money, our healthcare and our lives. 

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