Louisiana Gov. Bobby Jindal has made his the third state to unambiguously reject the ObamaCare mandate to create a state insurance “exchange.” Florida Gov. Rick Scott and Georgia Gov. Nathan Deal have previously said they will not impose these heavily regulated and price-controlled insurance market exchanges on their citizenry.
Under ObamaCare, if a state does not create its own exchange by 2014 the federal government will supposedly draft residents into one of its own making. In either case, the rules both limiting and mandating available insurance coverage will be written in Washington, D.C., not state capitols.
Two states have already created exchanges, Massachusetts and Utah. The Bay State did so as part of its “RomneyCare” experiment adopted in 2006, essentially a prototype for ObamaCare. The result has been dramatically higher insurance rates and longer waiting periods to see a doctor.
Utah’s exchange is claimed by some to be more “market friendly,” but that is arguable, and in any event it has proven to be expensive and unpopular. According to Mackinac Center Adjunct Scholar John Graham of the Pacific Research Institute, just 13 employers had signed up by the end of its first year, at a cost to taxpayers of half a million dollars. In Massachusetts, the state’s “Commonwealth Connector” exchange spent $26.6 million on vendors and contractors in 2009, plus $3.4 million on employee compensation.
The governors who have chosen not to collaborate with ObamaCare’s mandates have made no bones about what they think. “It doesn’t do anything to improve access to care. It does nothing to drive down health care costs,” Florida’s Gov. Rick Scott told the Politico Pulse. Gov. Bobby Jindal’s press secretary said of the law, “ObamaCare is a terrible policy that needs to be repealed and replaced. It creates enormous new costs and future unfunded liabilities for states financing their Medicaid programs.”
The Cato Institute’s Michael Cannon provides four good reasons here why Michigan Gov. Rick Snyder should join his southern colleagues in rejecting the special interest pleas to create a state exchange.