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Washington Examiner | Half of states won’t create insurance exchanges





A central aim of President Obama’s health care law is to expand the number of Americans who have health insurance, and the key to achieving this is through the creation of exchanges in all 50 states, plus the District of Columbia. It’s through these exchanges that individuals will use subsidies (varying by income) to help purchase government-designed insurance policies sold by private companies.

The Congressional Budget Office projected that the exchanges will help 25 million Americans find insurance by 2022, accounting for the bulk of the expanded coverage under Obamacare.

When it was written, architects of Obamacare hoped they could prod states into creating exchanges, thus reducing the administrative burden on the federal government. Under the law, if a state doesn’t create an exchange, the federal government must step in and create one on the state’s behalf. Initially, this was believed to be the perfect bludgeon with which to convince reluctant governors who prefer state control to embrace the exchanges.

But as time went on, it became clear to governors who opposed the law that the creation of a state-based exchange doesn’t give a state any actual control. The law creates only the thinnest veneer of flexibility, whereas in reality, all the major decisions — from the broad structure of the exchanges to the details of what kind of health care plans will be offered in the exchanges and how they will be marketed — are made in Washington. A careful reading of the law finds that all of the sections about state "flexibility" are filled with caveats that render them useless in practice because Secretary of Health and Human Services Kathleen Sebelius will effectively be running the show.

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