Another layer of the 2010 federal health care reform law was peeled back recently when the Department of Health and Human Services issued rules for the “American Health Benefit Exchanges” the states are supposed to establish.
If you read the fine print in the first of the proposed “exchange” regulations, it becomes clear that the exchanges will be tightly regulated; insurance choices will be limited and dictated by Washington; and the federal government, rather than the states, will be in charge. Although HHS has promised flexibility, the first proposed rule includes this: “an Exchange may not establish rules that conflict with or prevent the application of Exchange regulations promulgated by HHS.”
Beyond this, the 347-page proposal uses the word “require” more than 800 times and the word “must” nearly 440 times, according to a careful tally by a Capitol Hill staffer. Not much wiggle-room for the states there.
The exchanges were initially sold to state officials and the public as a tool to expand health care choices, especially for individuals and small businesses. The idea, we were told, was to “give (all) Americans the same insurance choices as members of Congress,” who get to choose from a wide variety of insurance plans under the Federal Employees Health Benefits Program.
However, HHS officials now acknowledge that this is not true. Unlike members of Congress, Americans who purchase insurance from an exchange will get just four choices. These choices may be further limited by their employers. By comparison, a federal employee in the Washington area has a choice of 19 plans. A federal employee in Chicago has 25 plans from which to choose.
While nothing is locked in concrete yet, it’s a safe bet that Health Savings Accounts and limited-benefit plans, such as those covering “catastrophic” medical expenses only — currently among the most affordable insurance options — will not be among the available exchange choices. In fact, the new law specifically prohibits catastrophic coverage policies for anyone over the age of 29.
What small amount of health privacy Americans still enjoy also will be out the door with the exchanges. According to the proposed new rules, “Privacy policies for the Exchanges will need to allow for the appropriate collection, receipt, use, disclosure and disposal of the various kinds of information including health, financial and other types of personally identifiable information.” Furthermore, HHS and the exchanges “are authorized to collect and use the names and Social Security account numbers of individuals ...”
In other words, information will be confidential — except the information the bureaucrats decide to use and share.
Florida, Kansas, Louisiana, New Hampshire and Oklahoma have taken a stand against this latest assault on health freedom and choice, returning to Washington the federal funds they received to create exchanges. The Minnesota legislature recently joined them by rejecting proposed exchange legislation and refusing to implement the exchange mandate.
Utah and Massachusetts — a pioneer in bad health policy — already have operating exchanges. HHS is temporarily required to “presume” that they are in compliance with the federal exchange standards. In an additional 13 states the exchanges are a work in progress: Legislation creating them has been approved, but that’s as far as it’s gone.
The good news is that state lawmakers still have a chance to limit the damage. If they’ve already passed legislation creating an exchange, they can repeal it. There is little likelihood that Washington will step in, since there is no plan for a federal “fallback” exchange and no money to implement such a plan, even if the administration proposes it.
If you’ve heard that the new health care exchanges will create a “marketplace” for health care choice, don’t believe it. As the proposed new regulations make clear, what we’ll have instead is an “exchange” gang, with Americans chained to government-imposed health care with no way out.
• Brase is president of the Citizens’ Council for Health Freedom, which favors a free-market health-care system.