New Hampshire Health Insurance Exchange Ban Headed to Gov. Lynch

New Hampshire Health Insurance Exchange Ban Headed to Gov. Lynch
June 16, 2012

The New Hampshire legislature has sent a ban on the implementation of the health insurance exchanges mandated under President Obama’s health care law to the desk of their governor.

The New Hampshire House agreed to Senate changes to a bill blocking implementation of the exchanges, sending the legislation to Democratic Gov. John Lynch. HB 1297 would prevent state officials from implementing a state-run exchange, but some Senators worried the bill would hamstring the Insurance Department from even talking with federal officials. The Senate version allows state officials to work with Washington if the Obama administration decides to set up a federally facilitated exchange.

New Hampshire is one of several states to return taxpayer funded exchange planning grants to the federal government.

Rep. Andrew Manuse (R-Derry), the lead sponsor of HB 1297, says the bill would make it more likely ObamaCare would be repealed or replaced, because Congress will be forced to reevaluate the law if enough states opt against setting up their own exchanges.

All About the Money

 Charlie Arlinghaus, president of the Josiah Bartlett Center, a New Hampshire-based think tank, has been a leading opponent of setting up a health insurance exchange. He says the state would have little say in how the exchange is run, but New Hampshire taxpayers would be forced to pick up the tab.

“The conclusion is obvious and at the heart of the exchange debate,” Arlinghaus said. “Whether it is run directly by the federal government or mandated by the federal government and carried out by local agents is immaterial. The regulations and decisions come from Washington, with perhaps a few window dressing exceptions. As such, we are not deciding between regulation and autonomy, we are deciding whether or not we want a puppet government.”

The driving factor for the creation of the exchange is money, Arlinghaus says.

“If it’s all the same, why not run our own exchange even for those few admittedly insignificant rules we can control? The difference is money,” he said. “The Massachusetts connector administers a less complex system than the new federal law, and its annual budget is $29 million. No one knows what a New Hampshire exchange would cost, but it would be somewhere between $10 and $20 million.”

Federal tax dollars pay for the start-up costs of an exchange, but after that the state would be on the hook for the costs, he notes. He also points out Obama’s law lacks authorization for the federal government to offer subsidies through the exchanges, making state-level creation of the exchanges all the more essential for Obama’s system to work.

“With a federally run exchange, the federal government—which hasn’t the budget authority for them yet—would have to weigh financial costs,” Arlinghaus said.

The bill now heads to Gov. John Lynch, who supports creating a state-run exchange. HB 1297 passed the House 219-94, and passed the Senate on a voice vote.

Grant Bosse (grantbosse@gmail.com) writes for the New Hampshire Watchdog.