Secretary of Health and Human Services Kathleen Sebelius recently extended the deadline for states to set up their own healthcare exchanges. Despite the extra month, the final state tally is 25 yes and 25 no.
Gov. Scott Walker’s “no thank you” letter added to the sizable pile of rejection slips on the secretary’s desk. The percentage of states denying a state exchange equals another key statistic. The latest Rasmussen poll shows 50 percent of Americans favor a full repeal of the Patient Protection and Affordable Care Act (ACA).
Walker’s spokesman cited cost as one of the main reasons for the state’s refusal. Estimates show an operational cost of between $45 million and $60 million for the exchange annually beginning in 2015.
Minnesota’s exchange already has exceeded cost estimates by 35 percent prior to implementation. Additional estimates show Minnesota taxpayers seeing another 18 percent rise in the first year of operation.
If ACA is implemented, overall premiums for Wisconsinites will rise a projected 30 percent, on average. This increase in Wisconsin’s individual insurance market was predicted by one of President Obama’s own health-care advisers, Jonathan Gruber. The Gruber-Gorman report predicts 94.5 percent of Wisconsin residents will face premium increases with 41 percent seeing increases in excess of 50 percent.
By stopping implementation of the ACA, Wisconsinites also will avoid the associated tax increases. The ACA increases taxes by $1.2 trillion federally from 2013-2022. Wisconsin’s share comes out to approximately $22 billion. This amounts to $15,796 for the average family of four.
This is truly a losing proposition for the people of Wisconsin. For each dollar paid in federal taxes, Wisconsin gets back around 85 cents. This will deprive Wisconsin of $3.3 billion during the 2013-22 period, which would otherwise be spent locally.
Walker’s opposition to the ACA in rejecting the state-run exchange is good for the nation and the pocketbooks of Wisconsin residents. It is, however, only the first step on what will be a long road.
The next big decision for Walker will be whether to also reject the expansion of state Medicaid. The Supreme Court ruling on ACA includes the decision that the federal government cannot coerce states into the proposed Medicaid expansion. The ruling on Medicaid bolsters Walker’s stance against Medicaid expansion and leaves him poised to reject an Obamacare Medicaid expansion.
Walker is not alone in this endeavor. Walker was among 33 Republican governors who sent a letter to President Obama in 2011 asking for relief from ACA provisions including Medicaid expansion. In the letter, the governors explained how their states cannot afford significant Medicaid expansions.
In Wisconsin, for example, ACA costs will force the state to divert funds from critical programs such as public safety and education.
A precedent has been set for states to win the battle to stop the implementation of the federal ACA. Over the past 16 years, 14 states have passed laws legalizing medical marijuana with two now legalizing it recreationally. The states’ override of federal marijuana legislation and U.S. Supreme Court rulings provide a solid remedy in matters of unconstitutional legislation and Supreme Court rulings.
South Carolina became one of the latest pieces of the puzzle states need to stop the implementation of the ACA. A bill was introduced in South Carolina that makes ACA null and void. Eleven other states have already passed similar legislation. Saying “no” to ACA and “yes” to consumer-driven healthcare continues to be the healthy choice for Wisconsin.
Rick Richard is a small business owner and coordinator of the Wisconsin Tenth Amendment Center.