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Rep. Labrador joins 72 other congressmen in opposing state insurance exchanges

Rep. Labrador joins 72 other congressmen in opposing state insurance exchanges

Idaho Freedom Foundation staff
July 4, 2012
Idaho Freedom Foundation staff
Author Image
July 4, 2012

Rep. Raul Labrador, R-Idaho, has joined 12 senators and 60 other representatives throughout the nation in signing a letter urging governors not to implement health insurance exchanges, calling them "expensive, complex, and intrusive." The letter, announced Monday in a joint press release issued by Sen. Jim DeMint, R-South Carolina, Rep. Michele Bachmann, R-Minnesota, and Rep. Jim Jordan, R-Ohio, declares that the signatories "are dedicated to the full repeal of this government takeover of healthcare and we ask you to join us to oppose its implementation."

Labrador, in his first term representing Idaho's 1st congressional district, has long been an outspoken opponent of the Patient Protection and Affordable Care Act (PPACA), informally known as Obamacare. After last week's U.S. Supreme Court ruling upholding most of legislation's provisions as constitutional, Labrador released a statement vowing a continued effort to repeal the law.

"The underlying philosophy of Obamacare was always about more than just health care," Rep. Labrador wrote. "The fundamental grievance that I have with this law, and in particular the individual mandate component, is that no government should ever be powerful enough to compel its citizens to purchase a product or a service under penalty of law. What is there now to prevent the federal government, or one of its agencies, from taxing us to compel the purchase of life insurance, a cell phone or any other product Washington deems is necessary for us all?"

The PPACA mandates that health insurance exchanges must be implemented in every state, with the federal government stepping in to do so if a state does not set up an exchange on its own. Although Gov. Butch Otter has also announced his intention to continue opposing Obamacare, he was among the most vocal proponents urging Idaho lawmakers to implement an exchange during the recent legislative session. Otter said in a December press release that he wanted Idaho to act, utilizing a federal health insurance exchange grant, before the federal government took control.

"Legislative approval to spend the grant money would enable Idaho to build an exchange, but even that option has potential complications," Otter wrote. "If Idaho sets up an exchange using federal dollars and the federal government does not approve of how the exchange is structured, it will step in and take over. If the Legislature rejects the grant money and the Supreme Court upholds Obamacare, Idaho loses control and our citizens will be subjected to a federal exchange."

The letter signed by Labrador and many other congressmen suggests that implementing exchanges at the state level would amount to squandering taxpayer funds and lawmakers' time.

"State-run exchanges are subject to all of the same coverage mandates and rules as the federally-run exchange," the letter said. "Clearing the hurdles of crafting an exchange that complies with the 600 plus pages of federal exchange regulations will only result in wasted state resources and higher premiums for your constituents."

However, House Minority Leader John Rusche, D-Lewiston, told IdahoReporter.com that he believes a federal exchange would be more expensive for Idahoans than a state-based exchange, because most insurance providers marketing policies to multiple states through a federal exchange would offer standard benefit packages that exceed the mandates required in Idaho, making the insurance more costly.

"When you look at a benefit package that a multistate insurer would put together in its small-group program, the benefits would have to fulfill the benefit requirements of the state or the federal employee program," Rusche said. "Well, the market in Idaho isn't big enough to drive United or Aetna or Travelers or anyone else to build a specific policy for Idaho. They're going to go with multistate benefits that will be more expensive than our current small-group benefit package."

Rusche also said it's important to calculate costs before making policy decisions that purport to be cost-conscious.

"I would have hoped that they would have done analysis with actuaries, with comparison of the relative benefit packages," Rusche said, "Because sitting in Idaho, with the least-mandated benefits in the entire country, we have nowhere to go but up in cost."

Whoever is ultimately right about the potential comparative costs of state and federal insurance exchanges, the letter Labrador signed primarily focuses not on overall costs but on an eventual repeal of the PPACA, and a call to action for governors to aid in overturning the law.

"Implementation of this law is not inevitable and considering more than half of the American people oppose the law, it is improbable," the letter said. "Join us in resisting a centralized government approach to health care reform and instead focus on solutions that make health care more affordable and accessible for every American. Let's work to create a health care system of, for, and by the people, not government or special interests."

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