COLUMBUS, Ohio (Nov. 16, 2012) – Ohio has joined the growing list of states refusing to implement insurance exchanges under the Patient Protection and Affordable Care Act.

On Friday, Ohio Governor John Kasich sent a letter to the director of the Centers for Medicare and Medicaid Services Center for Consumer Information and Insurance indicating the Buckeye State will not take steps to set up the exchange.

“At this point, based on the information we have, states do not have any flexibility to build and manage exchanges in ways that respond to unique needs of their citizens or markets. Regardless of who runs the exchange, the end product is the same,” he wrote.

Kasich sent D.C. a bullet pointed list of items Ohio will not proceed with.

 In light of this significant uncertainty and the negative impacts the law will have on Ohio:

• Ohio will not operate a federally-mandated exchange but instead will exercise its right under the law to leave that to the federal government;

• Ohio will not relinquish to the federal government its right to regulate its insurance market but, as permitted under the law, will instead retain the right to regulate the state’s insurance industry through the Ohio Department of Insurance as it has done very effectively for more than 60 years;

• Ohio will not turn over to the federal government the right to determine Medicaid and Children’s Health Insurance Plan (CHIP) eligibility for its citizens but, as permitted by the law, will retain that function as well and manage that work through Ohio’s Medicaid director;

• Ohio has no plans to run a state reinsurance program at this time, and;

• The Director of the Ohio Department of Insurance is designated to work with HI-IS to finalize the Exchange Blueprint and work through other related issues.

The Ohio governor echoes a theme common to most of the states that have indicated they won’t set up the exchanges. Analysis shows the state exchange plans strip autonomy and decision making power from the states and vests it in the D.C. bureaucracy,  they will cost billions of dollars, and they generally bode ill for the people of the states. As Kasich said, “Regardless of who runs the exchange, the end product is the same.”

And that product is bad.

In Federalist 45, James Madison wrote that state power would extend to all objects “which, in the ordinary course of affairs, concern the lives, liberties and properties of the people, and the internal order, improvement and prosperity of the State.” The PPACA exemplifies  one of the practical reasons the framers limited federal power. Centralized solutions handed down from on-high result in crappy policy.

More importantly, Madison eludes to a much more basic fact – federal meddling in a state’s health care and health insurance programs represents an unconstitutional, and therefore illegal, exercise of power. Governors should refuse to comply with the health care act based on that fact alone. Unfortunately, most of the governors take a similar tact as Kasich, based on pragmatic arguments, not a principled defense of the Constitution and the sovereignty of a state over health care. This fact is particularly sad for Ohioans  in light of the fact that they overwhelmingly voted to amend the state constitution to guarantee health care freedom way back in 2010.

“Governor Kasich fails to mention the fact that creating a state-run exchange would be a violation of Ohio’s constitution,” Ohio Tenth Amendment Center coordinator Scott Landreth said.

Still, every state that refuses to cooperate adds to the burden placed on D.C. The feds rely on states to administer these things. Hopefully, mass refusal will not only gum up the system, but set the stage for more aggressive efforts to block this unconstitutional and economically untenable act.

For more information on health care act nullification options, click HERE.

Mike Maharrey

The 10th Amendment

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