BS Alert: State-run exchanges do not mean local control
Thursday, November 10, 2011
BS Alert by Brett Narloch
Issue: Federalism

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During this special session, the North Dakota legislature will be deciding whether or not they should become the first state in the country to start implementing Obamacare. Specifically, the issue at hand is whether or not the state government should set up health insurance exchanges with a grant received by the federal government or they should let the federal government set up the exchange in North Dakota.

At first glance, conservatives might say that our state government should setup and run the exchanges. After all, bureaucrats in North Dakota are better than bureaucrats in Washington, DC. The prevailing wisdom is that since North Dakota would more efficiently run the health insurance exchanges, we should set them up. That, however, ignores the fundamental realities about Obamacare.

Let me refer you to a recent BS Alert published by yours truly:

The problem is, according to Michael Cannon of the Cato Institute, that the US Department of Health and Human Services will still determine whether or not your exchanges are in compliance. In other words, local control is a mirage. Furthermore, those who believe that Obamacare may be unconstitutional – which is 101 of the 141 state legislators – would be violating their oath of office to protect and defend the Constitution if they participate in facilitating the implementation of anything that they believe may be unconstitutional.

And, as Cannon points out, by participating in creating the exchanges, states are legitimizing Obamacare and, thus, will make it harder to repeal.

Lastly, the insurance companies that will be given billions of dollars through the exchanges would spend a lot of money to make sure that the law never gets repealed.

North Dakota should wait until more of the rules regulating the exchanges become available, and wait until an administration in Washington, DC is more favorable toward the states and health care freedom. And reject the money. The federal grants used to get the exchanges off the ground won't be around forever. Eventually, the state - if they decide to manage it right now - will have to pick up he costs of administering the exchange. Kansas recently returned $31.5 million.

State-run exchanges will not be state run. North Dakota participating in the exchanges is BS.