Stopping the Compact from Becoming a Trojan Horse

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by Nick Dranias, Goldwater Institute

Tea Parties across the country have been championing the idea of using interstate compacts—which are basically legal agreements among the states—as a way of delaying the roll-out of President Obama’s so-called Patient Protection and Affordable Care Act, also known as Obamacare. The most popular compact idea, the “Health Care Compact,” has already been adopted by Texas, Utah, Missouri, Indiana, South Carolina, Oklahoma and Georgia. It promises to move “the responsibility and authority for regulating health care from the federal government to the states.”

There’s only one problem. Section 1333 of the federal health care law specifically anticipates what it calls “Health Care Choice Compacts” and prescribes how such compacts must be organized, allowing them to exist only if they replicate nearly all of Obamacare’s most burdensome and costly regulations. In short, this little known provision could easily co-opt and subvert the growing Health Care Compact movement to ensure federal law continues to govern even the states that join the compact.

It is critically important that all health care compact initiatives explicitly reject section 1333 of the federal health care law. This is the only way for states to ensure that their compact will actually serve as a genuine vehicle for preserving state sovereignty and freedom of choice in health insurance. Any health care compact initiative that fails to do risks becoming a Trojan Horse for federal domination of health insurance markets.

Compacts are a promising tool for protecting states against federal overreach, but we have to get the details right and we can’t afford to let this issue go unaddressed simply because some states have already adopted the Health Care Compact. We can fix it in the states that already have, and move forward on sounder footing in states that haven’t.

Learn more:

Goldwater Institute: Ten Reasons Why Arizona Must Reject Health Insurance Exchanges

Health Care Compact: Website

U.S. Government: Patient Protection and Affordable Care Act, Section 1333 (PDF)

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2 comments
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oshane
oshane

I wonder whether this is actually a problem. Compacts only have constitutional force if they are approved by Congress. Presuming Congress would pass such compacts into law, they should arguably have the equivalent force of law as the Health Care Choice Compacts clause of the PPACA. Their direct contradictions of the PPACA would arguably supersede the PPACA. Yes, the principles of statutory interpretation put a high premium on reconciling all federal statutes as much as possible, so a federal judge might shoehorn a contravening compact into the Health Care Choice Compacts clause and read it accordingly as subservient to the PPACA. But if the compacts were written in sufficiently strident and contradictory language, it would be an easier argument to say that Congress's later approval of these compacts would override the PPACA, as both would have been Congressional actions. Otherwise, the net result would be to say that Congress cannot abrogate or repeal its own laws—precisely because for compacts to pass constitutional muster under the Compacts Clause, Congress has to expressly write them into the public laws.

 

The compacts would not likely survive a legal challenge if the states didn't seek Congressional approval but just made bilateral or multilateral agreements outside the Compacts Clause of the Constitution. And because such compacts are not recognized as having the constitutional force of law, they would likely fall under the Secretary of Health and Human Services's purview, whom Congress has delegated through the Health Care Choice Compacts clause of the PPACA to give approval to conforming compacts without Congress's further involvement. Whether that is philosophically constitutional is another question, but my sense is that the courts would not hesitate to uphold the Secretary's authority under this provision.

 

Of course, there are also political rather than legal factors at work. If a sufficient number of states made Tenth Amendment assertions opposing the PPACA or agreed multilaterally not to assist enforcing it, the federal law might become practically moribund with or without Congressional involvement. But I suspect that a "sufficient" number of states would be fairly high—38 maybe?

 

onetenther
onetenther

Whoever thought of Obamacare must have had a lot of time to think about it if they could anticipate this.