Trouble Continues For ObamaCare's Health Insurance Exchanges


He'll set up the health exchanges himself if he has to.

The Washington Post reports that about a third of states have not made much progress in setting up ObamaCare's state-based health exchanges, but doesn't note that several, including Florida, Louisiana, and Kansas, have already made it clear that they won't set up exchanges at all. That's not an insignificant consideration, because, as The Post explains, the health insurance exchanges are kind of a big deal:

State-based exchanges are crucial to achieving the law's goal of vastly expanding access to health insurance. They will be open to an estimated 24 million Americans for whom health plans have been particularly expensive — those who buy coverage on their own or as employees of a small business. The exchanges are intended to control costs by creating a larger pool of customers and allowing them to comparison shop. Many customers will also qualify for federal subsidies.

If a state is unwilling or unable to run an exchange, the federal government can step in. But the prospect of taking over exchanges in multiple states could prove logistically and politically unpalatable for the Obama administration.

It's a political challenge because if a state decides it doesn't want to participate in ObamaCare, it will be hard to avoid the (accurate) appearance that the federal government will be effectively taking over the state's individual health insurance market (the health exchanges are expected to become the hub for essentially all individual health insurance policy purchases). Indeed, the Post report accepts this notion when it says that "technically, states have until Jan. 1, 2013, to demonstrate enough progress to avoid a federal takeover." 

Logistically, setting up the health insurance exchanges is going to be a pain in the neck for anyone, especially when it comes to making determinations about which individuals qualify for new health insurance subsidies. But the Department of Health and Human Services faces a slew of potential difficulties that are specific to the federal exchances. For example, there's the minor problem that there isn't any money set aside to set up the federal exchanges. Also, the way the law is written, it only allows its insurance subsidies to go to people who purchase insurance through state-run exchanges. Needless to say, that would only compound the political problems: The states that opposed ObamaCare the most would not only end up with federally run exchanges, they'd end up stuck with a mandate to purchase health insurance—health insurance that's projected to rise in cost following ObamaCare—but none of the subsidies designed to ease the pain of the mandate. 


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  1. You just had to wait until we passed the bill to see what was in it–and no funding for Federal Exchanges is just the sort of thing I was talking about.

  2. So we’re winning?

    U.S. Boots on the Ground in Libya, Pentagon Confirms

    Read more: http://www.foxnews.com/politic…..z1Xm6IBmDw

    1. Yes, we often have soldiers at our embassies. I don’t think even Ron Paul is going to worry about that.

  3. Also, the way the law is written, it only allows its insurance subsidies to go to people who purchase insurance through state-run exchanges.

    But those subsidies are passed along via the IRS. And Reason has already reported that the IRS has so far showed no indication that it intends to execute the law faithfully on this matter. The IRS intends to ignore that little “typo” and pass along the subsidies to everyone in the exchanges, regardless of which government is responsible for those exchanges.

  4. State need to keep as far away from this cluster-fuck as possible so that when the implosion comes, the Obamanauts won’t be able to claim it was a great plan fucked up by those stupid-ass bureaucrats in Topeka.

  5. How about a Libertarian suggestion? Start with repealing prescription laws. Continue to repeal of US laws that forbid people to import medicine for their own use. Allow people to take care of their own health. Doesn’t that make sense?

  6. People deserve what is coming.

    Massachusetts was a matter of record before they jammed analogous federal law through too: Everyone — but everyone — knew exactly what would be happening.

    The very point of the legislation was to shut down private competition and force everyone into government controlled health care.

    Don’t whine when it inevitably succeeds, and don’t whine when the entire country turns into bloody Massachusetts.

  7. This is a classic good news bad news. The good news is that many states are not cooperating with the federal take over. The bad news is that since many states may not set up exchanges the federal government will step in and create them in those states, thus adding to the federal takeover. But if Congress decides not to fund them this may be good news.

  8. When will someone talk about the tax that you will have to pay on the sale of your house in 2012. This is in the health care bill. This is a very painful tax. If you sell your house for let’s say $100.000 the tax would be a little under $4000.00. This is not just a tax on the rich! Please when will people wake up!

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