Can Arkansas's Legislators Stop Obamacare in Arkansas?

Obamacare May Have a Fatal Flaw
Curtis Coleman, Contributing Author:  In a curious and perhaps fortuitous alignment of events for the almost 75% of Arkansans who are opposed to Obamacare, Arkansas’s legislators may have an opportunity to shut down Obamacare in the State.

EVENT ONE
The first half of the equation comes from the Cato institute in Washington, D.C. In his podcast, “ObamaCare Glitch Could Unravel Law,” The Institute’s Michael Cannon discloses his discovery in the Patient Protection and Affordable Care Act (PPACA) that allows a critical part of the Act to function only through state-run health-care exchanges.

Cannon also wrote about the glitch:

Investors Business Daily reports on the latest glitch found in ObamaCare‘s 2,000-plus pages:

Because of a quirk in ObamaCare, people who buy health insurance through a federally run exchange may not be eligible for premium subsidies.

Government-created exchanges are places for individuals to shop and purchase health insurance. ObamaCare will require individuals and families to buy insurance, starting in 2014.

Those with incomes at 100% to 400% of the federal poverty level will be eligible for taxpayer funded subsidies — a tax credit to help pay for the premium. It turns out that the legislation isn't so clear, the latest example of what analysts predicted would be a stream of surprises from the mammoth health law.

Section 1311 of ObamaCare instructs state governments to set up an exchange. If a state refuses, Section 1321 lets the federal government establish an exchange in the state.

Yet ObamaCare states that the tax credit is available to people who are enrolled in an “an exchange established by the state under (Section) 1311.” It makes no mention of people enrolled in federal exchanges being eligible for the tax credit.

“There is this technical problem in the law,” said James Blumstein, a professor at Vanderbilt Law School. “I don’t see how you get around that.”

I guess the folks who chanted, “Read the bill!” seem a little less crazy now.

Regrettably, the IRS has tried to “get around” the clear meaning of the law. In a proposed rule, the IRS writes that taxpayers will be eligible for ObamaCare’s “tax credits” — which are more government spending than – if they are enrolled in a health plan “established under section 1311 or 1321” [emphasis added]. But that’s not what the law says.

As I told IBD:"Congress did not delegate this discretion to the IRS,” Cannon said. “Congress created a tax credit for A, and the IRS is saying it applies to A and B. If the IRS offers this tax credit to federally run exchanges, the IRS will be assuming powers the Constitution vests only in Congress to alter the tax code and spend money.”

Citizens have until October 31 to share with the IRS their thoughts about the agency’s overly broad interpretation of its powers (see here).

More broadly, this bug feature means that states can block ObamaCare’s new entitlement spending, and possibly the entire law, just by refusing to create an Exchange:
“The whole structure of the law collapses without a state-run exchange,” said Michael Cannon, director of health policy studies at the libertarian Cato Institute. “That forces Congress to either repeal ObamaCare or significantly alter it.”

Yesterday, Rep. Michael Burgess (R-Texas) helpfully suggested that the so-called “Super Committee” should meet its target of $1.5 trillion in spending reductions by cutting ObamaCare’s new entitlement spending:

The Select Committee is getting to work, and I encourage both parties, all 12 members, to put the Affordable Care Act on the table, alongside other entitlements in need of reform…The easiest money to save is money you haven’t yet spent…This new select committee could easily achieve almost their entire target of reducing the nation’s deficit, and…almost every dollar would come from benefits that do not yet exist.

The wonderful thing about this newly discovered feature of ObamaCare is that states don’t have to wait for Congress to act. They can reduce federal spending simply by not creating a health insurance Exchange.

EVENT TWO
The second half of the equation is furnished by Arkansas Gov. Mike Beebe. The Governor is reported to have said that “he’ll require a show of support from legislators before allowing the state to apply for a second round of exchange-planning grants from the federal government.” (Let it be noted, dear reader, that a grant from the federal government is not, as some Arkansas bureaucrats would have you believe, “free money.” A “federal grant” is your tax money, dramatically shriveled by its trip through Washington.)

Arkansas Insurance Department commissioner Jay Bradford has reportedly said that “not applying for a second-round of will trigger the federal exchange because ‘we will have quit planning.’” If Arkansas’s legislators refuse to support the implementation of state-run Obamacare exchanges, Arkansas may have the unexpected opportunity to do exactly what Michael Cannon proposes – “force Congress to either repeal ObamaCare or significantly alter it.”

Arkansas State Representative Jon Hubbard (R-Jonesboro) sent an email to Republican members of the Arkansas House this week urging them to continue to oppose Obamacare’s implementation in the State:

 I think that we as a Republican Caucus, both House and Senate Members, need to send the message LOUD & CLEAR to Governor Beebe and Insurance Commissioner Bradford, that the people of Arkansas DO NOT want Obama care imposed upon them against their will!!! According to Commissioner Bradford’s request to a group of Republican Legislators last week, if we as a Legislative group do not send a letter to the Governor before the September 30th deadline encouraging him to apply for the Level 2 grant to implement this unconstitutional mandate upon the people of this state, he will “bail”. What better opportunity could we wish for to derail this fiasco!!! Beebe’s and Bradford’s scare tactic has always been that “if we do not implement our own form of Obama care at the state level, then the Federal Government will step in and implement their version of this plan.” If we haven’t yet figured out how this Obama regime operates, understand that the Federal Government IS going to “step in” and implement their own plan, REGARDLESS of whether a state has implemented their version or not, plain and simple!!!

This is our chance to show the people of Arkansas that the Republican legislators of this state have the backbone to not only “STAND UP” to, but to “STOP” this Obama regime’s reckless and unconstitutional mandate toward socialism. If we fail to act against this regime and it’s State level emissaries in the destruction of America, the people of Arkansas will not forget, and they will express their anger at the ballot box!

I propose that we draft a statement to this effect, and everyone sign on as a statement of solidarity and strength, and send it to Governor Beebe and Commissioner Bradford. We cannot allow these two representatives of the Obama regime embedded within our own State Government to cram this abomination down the throats of our people!

If Arkansas’s legislators continue to stand with the majority of Arkansans in rejecting Obamacare and its exchanges, and if Michael Cannon of the Cato Institute is right in his assessment of the Act, and if Gov. Beebe stands by his reported statement to not pursue additional federal taxpayer-money grants, then Arkansas might just have the perfect opportunity to stop Obamacare in Arkansas – or at least dramatically reduce federal spending for this unconstitutional and unaffordable new federal overreach.
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Curtis Coleman is the President of The Curtis Coleman Institute for Constitutional Policy and contributing author to the ARRA News Service.

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