PHOENIX (Feb. 19, 2015) – Yesterday, an Arizona House Committee approved a bill that would create significant roadblocks for implementation of the Affordable Care Act, leaving the federal program without an enforcement mechanism in the state should it pass.

Introduced State Reps. Justin Olson and Rep. Vince Leach, House Bill 2643 (HB2643) would prohibit the state in various ways from “from using any personnel or financial resources to enforce, administer or cooperate with the Affordable Care Act.” The House Federalism and States’ Right Committee passed it yesterday by a vote of 5-3.

Most prominent in this list of prohibitions is a ban on “funding or aiding in the prosecution of any entity for a violation of the act.” This would prevent the Arizona Department of Insurance (DOI) from investigating or enforcing any violations of federally mandated health insurance requirements, something that will prove particularly problematic for the feds.

State insurance commissioners  and departments serve as the enforcement arm for insurance regulation in the states. So, when people have issues with their mandated coverage, they will have to call the feds.

“Disputes over these mandates arise under federal, not state law,” said Mike Maharrey of the Tenth Amendment Center. “The federal Department of Health and Human Services cannot commandeer the Arizona Department of Insurance to force them or to investigate alleged violations if this bill passes. And because at present there is no federal health insurance agency and Congress is not likely to create one given the substantial opposition to Obamacare, they’ll just have to figure it out on their own.”

Should the IRS ever gain approval to start using liens to collect failure to pay penalties from people who refuse to sign up, they won’t be able to record them with any level any county clerks or the Secretary of State in Arizona. Without liens, the IRS is already going to have a difficult time collecting, and if they’re permanently blocked from using them in Arizona, that would represent a significant layer of protection for the people there.

HB2643 is a practical implementation of Proposition 122, a voter-approved amendment to the state constitution in 2014 that provides a mechanism for refusing state resources to federal programs.

Beyond the prohibition on the DOI, the bill also expressly prohibits the creation or operation of a health insurance exchange for the ACA. While former Governor Jan Brewer decided that the state wouldn’t create one, Maharrey said leaving such a big decision to the fate of a future Governor is precarious, at best.

“I don’t expect the new Governor to suddenly change course on an exchange, but you never know,” said Maharrey. “Republican Governors around the country have flip-flopped on Medicaid expansion and Common Core, so we can’t really trust them to do the right thing on this either. That’s why an express prohibition on creating an Obamacare exchange in Arizona is an additional protection for the people.”

Shifting the burden for health insurance exchanges to the feds helps overwhelm the implementation of Obamacare. Some analysts suggest that the feds only have the capacity to do so in 30-40 states over the long term, and any more than that will help collapse the system.

Additionally, the HB2643 would prohibit “funding or administering any program or provision of the act…that will result in any of the following:

  • Reducing the available insurance or provider choices
  • Increasing burdens on insurance providers or carriers.
  • Limiting the availability of self-funded health insurance programs
  • The reinsurance or other products traditionally used with self-funded health insurance programs.

LEGAL BASIS

Both Prop 122 and HB2643 are based on a long standing legal principle known as the Anti-Commandeering Doctrine. Over 170 years of Supreme Court precedent, dating from 1842, have supported the idea that states cannot be required to help the federal government implement or enforce their acts or regulatory programs.

The 1997 case, Printz v. US serves as the cornerstone. In it, Justice Scalia held:

The Federal Government may neither issue directives requiring the States to address particular problems, nor command the States’ officers, or those of their political subdivisions, to administer or enforce a federal regulatory program. 

As noted Georgetown Law Constitutional Scholar Randy Barnett has said, “This line of cases is… considered well settled.”

NEXT

HB2643 now moves to the House Rules Committee, where it will need to pass by a majority vote before the full House can consider it.

TAKE ACTION

In Arizona, follow all the steps to support this bill at THIS LINK

All Other states, take action against the ACA in your state at this link.

 

Michael Boldin