Center Analyst Leads Charge Against Obamacare Exchange in Michigan

In a Sept. 14 “Special Message on Health and Wellness,” Gov. Rick Snyder told a statewide audience, “I urge the Legislature to enact legislation creating the MI Health Marketplace before this Thanksgiving.”

News reports said little about this “health marketplace,” but in fact it was big news: The proposed state-level health exchange would administer one of Obamacare’s key elements — insurance subsidies for individuals earning up to 400 percent of the poverty level. This subsidy is the source of the law’s $1 trillion-plus cost over the next decade.

Even for those opposed to Obamacare, there were rational arguments why the state should create the exchange. Ostensibly, a state-established exchange would provide greater state control of health care policy and bring more predictability to Michigan’s insurance marketplace than waiting for the federal government to create an exchange for Michigan instead.

But from a broader policy perspective, this seemingly sensible argument was ultimately imprudent and wrong — a point seen with compelling clarity by Mackinac Center Senior Legislative Analyst Jack McHugh. McHugh drove this comprehensive view of the exchange home through relentless original reporting and by sharing the analyses of the nation’s savviest free-market health policy experts. The effect has been powerful: Even as reporters and Lansing insiders seemed to take for granted that the Legislature would deliver this health exchange as requested, the legislation has stalled.

Over the past 12 months, McHugh has written more than 30 articles and commentaries for Michigan Capitol Confidential. He also authored Op-Eds that appeared in the Detroit Free Press and Lansing State Journal, delivered radio interviews, gave talks to local groups, spread the word through social media and more. While the public at large heard little about the proposed exchange until recently, for months Tea Partiers, active voters and others motivated by economic and liberty concerns were kept informed.

When a bill was finally introduced and hearings began several weeks after the governor’s address, many legislators quickly heard a clear message from important constituents: “Not so fast!” Although the state Senate passed a bill on Nov. 10, indications are that the House is less likely to do so.

Elected officials have told McHugh that the impact of the Center’s articles is part of why the House has been reluctant to even consider the legislation. There were also reports that his commentaries were being circulated among House members. Exchange supporters have complained that his work was obstructing their efforts.

Under the federal Patient Protection and Affordable Care Act, states must set up their own PPACA “exchange” or the feds will do it for them. Many policymakers, though they are not sympathetic to PPACA, believe that the least-bad option is to create a state exchange that takes advantage of whatever small opportunities may exist to insulate Michigan from at least a few of Obamacare’s many destructive provisions.

McHugh repeatedly argued that this excessively narrow focus obscures the infinitely more vital priority of consigning Obamacare to the dust heap of history’s big government mistakes. There are good reasons — McHugh cited 10 of them in one article — to expect that moving too quickly on the creation of an exchange may push that all-important goal further out of sight.

Nevertheless, McHugh pointed out, given the challenges of compliance, Gov. Snyder’s desire for an early start is understandable. Among other things, the Governor has spoken of the huge technology issues involved. Michigan’s insurers also face huge challenges in adapting their operations to the new law, and they reasonably desire certainty sooner rather than later.

Michigan is not alone — every policymaker in every state faces the same challenges. But certainty is one thing they’re not likely to get soon, given past experience with large state/federal social welfare programs. State control is most likely another forlorn hope. Here’s how the Wall Street Journal described the first set of federal exchange regulations released last July: “The word ‘require’ appears 811 times in the 244-page rule and its 103-page supplement. ‘Must’ shows up 580 times — and this is merely HHS’s first batch of exchange mandates …”

Given the overwhelmingly unconstitutional nature of Obamacare, its assault on individual choice, and the fact that quick action may detract from the larger goal of repeal, prudence suggests the Michigan Legislature model the tortoise, not the hare. Let the U.S. Supreme Court render its verdict in June and allow voters to render theirs in November. Holding back, even if doing so risks greater implementation challenges and costs down the road, is worth it when the ultimate goal is so important.

Thanks to the work of Jack McHugh and the free-market health care experts whose work he has drawn upon, much of this background was known by CapCon readers before legislation was introduced this fall. They had already learned on Aug. 3 in “Michigan Creeps Closer to Obamacare ‘Exchange’ ” that a flaw in the drafting of Obamacare potentially involving much more than a mere “scrivener’s error” could bring down its entire tottering structure.

This article also reported that the lead attorney for one of the lawsuits against Obamacare had just told lawmakers attending a national organization’s meeting, “Saying ‘no’ to a state exchange is absolutely critical to the success of our lawsuit and those pending elsewhere around the country.” The piece explained that a federal judge who ruled Obamacare unconstitutional had cited states’ creating exchanges as one reason to stay his own ruling.

In the fall, other CapCon items, interviews, Facebook postings and speeches followed at a rapid pace. Among the articles were, “Obamacare ‘Mandate’ Could Penalize 70,000 Here,” “NFIB: ‘No Rush’ on Creating Obamacare Exchange,” “Obamacare ‘Exchange’ Opposite of ‘Free Market, ’ ” “‘Exchange’ an Obamacare Trojan Horse?” and others.

Where this all lands is anyone’s guess, but on one relevant point the Mackinac Center is certain: While most of those advancing exchanges are acting in good conscience, the Center’s independent analysis and free-market principles have never been put to better use than they are now — helping Michigan residents cut through the bureaucratic clutter and call on lawmakers for policies that will protect Michigan’s future health care freedom.