Friday, November 30, 2012

Will states opting out of insurance exchanges unravel Obamacare?

Michale Cannon of Cato seems to argue that.See here.

Michigan is the latest state to say no thanks to the insurance exchange deal.Cannon has argued that while the federal government can establish an exchange it cannot have the subsidies that were to be part of the state exchanges. The IRS has issued a ruling that claims the opposite. Cannon and his co authors argue that both the legislative history and the statutory  language make it clear that ACA did not authorize the subsidies to the federal run exchanges.

The key thing seems to be how the courts rule regarding  the federal established exchanges legal  authority to issue subsidies .Ultimately if the issue reaches SCOTUS , will Justice Roberts act in a way to redeem himself  in the eyes of his former conservative supporters or will he once again dazzle us with innovative legal reasoning? My pessimistic prediction is for more bedazzlement.

Even if the IRS ruling holds as Dr. Scott W. Atlas of Hoover Institute argues here ,Obamacare may prove to be unworkable as costs rise and access to health care actually decreases (insurance cards do not magically generate physician) and the public or interests groups and politicians clamor for a solution we may well face the single payer option. Some have argued that was the plan all along even though that assumes greater wisdom in those who planned ACA than I think they likely possess.


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