Obamacare Faces New Threat at State Level from Corporate Mega-Lobby ALEC

Search form

Obamacare Faces New Threat at State Level from Corporate Mega-Lobby ALEC

Obamacare Faces New Threat at State Level from Corporate Mega-Lobby ALEC
Fri, 11/22/2013 - by Ed Pilkington
This article originally appeared on The Guardian

Barack Obama is facing a fresh offensive against his troubled healthcare reforms as Republican legislators backed by corporate sponsors prepare an attempt to effectively destroy the Affordable Care Act at state level.

With Obamacare still in crisis from its botched technical rollout, the signature reform of the Obama presidency faces threats from state-based politicians who have devised a strategy to scupper the federal health insurance exchanges.

The move is the latest in a sustained effort by conservative states, mainly in the South and Midwest, to resist key elements of the changes that are designed to extend healthcare to millions of uninsured Americans.

The idea for the new attack is the brainchild of the American Legislative Exchange Council (ALEC), a group that acts as a dating agency for Republican state legislators and big corporations, bringing them together to frame rightwing legislative agendas in the form of “model bills.”

A new ALEC proposal, approved by its annual meeting in Chicago in August and published as a model bill for adoption by state assemblies across the nation, would scupper the federal health insurance exchanges set up under Obamacare. The Health Care Freedom Act, as ALEC calls its model bill, threatens to strip health insurers of their licenses to do new business on the federal exchanges should they accept any subsidies under the system.

ALEC justifies the measure as a way to protect local employers from the “employer mandate” – the provision in Obama's act that penalizes employers with more than 50 workers who do not offer any or sufficient healthcare cover for their employees. However, health insurance experts say that were the model bill to be taken up widely by Republican-held states, it would seriously disrupt the federal exchanges, and in turn put the whole health reforms in peril.

Legislation with almost identical language is already being debated in the state assemblies of Missouri and Ohio.

“You cannot build the healthcare system based on the free market unless you have subsidies. If they are taken away the whole thing collapses,” said Wendell Potter, a former health insurance executive and critic of the health industry.

Lisa Graves, the executive director of the Center for Media and Democracy, which monitors the activities of ALEC, called the model bill “a blatant effort to nullify the federal healthcare reforms. If this is successful it would ultimately deny an untold number of Americans help under the ACA.”

The threat posed by ALEC’s model bills to Obamacare is not academic. Over the past five years, ALEC has been a prominent thorn in the side of the administration, particularly over its healthcare reforms. The council has circulated a 32-page guide for state legislators called “Repealing Obamacare,” as well as launching numerous model bills targeted at various aspects of the legislation.

An earlier ALEC model bill, Freedom of Choice in Health Care Act, was taken up by Republican-controlled legislatures across the U.S.. It sought to undermine the ACA by blocking one of its core components – the “individual mandate” that makes health insurance compulsory for most Americans. ALEC’s challenges were seminal in pushing the case up to the U.S. supreme court that eventually ruled in the administration’s favor by defining the mandate as a tax.

Similar legal challenges, potentially also going all the way up to the supreme court, are expected should ALEC’s new model bill targeting federal health insurance exchanges become law in any state.

As a group that exists to facilitate an exchange of ideas between conservative politicians and big corporations, it is no surprise that ALEC’s healthcare priorities reflect the interests of both the health insurance and the drug-production industries. The Center for Media and Democracy points out that in 2012 the council’s health and human services taskforce was privately chaired by an executive of Guarantee Trust Life Insurance.

ALEC’s Chicago conference in August was sponsored among others by PhRMA, a lobby group that represents leading U.S. pharmaceutical and biotechnology companies; drug companies such as Celgene, Takeda Pharmaceutical and Eli Lilly, and the tobacco giant Reynolds America.

Thirty-four states have so far refused to set up their own local exchanges under the ACA. The exchanges are a pivotal element of Obamacare because through them poorer families can shop for affordable health insurance with the help of federal subsidies in the form of tax credits.

In the absence of co-operation at state level, the Obama administration has been forced to step in and create its own network of federal exchanges in those 34 states. It is these federal operations that are now within ALEC’s sights.

Ethan Rome, executive director of a coalition that supports Obama’s reforms called Health Care for America Now, said that the ALEC proposal was such a frontal assault on the federal exchanges that it represented “a form of state-based repeal of the ACA. This would make it virtually impossible for federal exchanges to function because insurers would no longer participate – and that would have the effect of bringing down the federal exchanges one state at a time.”

Sean Riley, who heads ALEC’s health and human services task force, said the aim of the model bill was simple: to protect businesses from the penalties applied under the ACA on employers who do not provide health insurance. “The [employer] mandate not only deters small business growth, but has led numerous public and private sector employers to restrict employee hours. Because the mandate’s fines are triggered by the availability of exchange subsidies, removing their availability – as the model intends – would remove the mandate, freeing employers to grow.”

ALEC’s health and human services taskforce will be reconvening in December at the council’s next nationwide summit in Washington. A range of potential new model bills relating to Obamacare are to be discussed, including what a proposal that according to ALEC would “protect consumers from potential fraud relating to exchange navigators under the ACA.”

Originally published by The Guardian

Article Tabs

According to new research, the richest one-hundredth of one percent of Americans now hold over 11 percent of the nation’s total wealth – a higher share than the top .01 percent held in 1929 before the Great Crash.

It's been over a month since 18-year-old Vonderrit Myers, Jr. was killed by a St. Louis police officer.

Instead of loaning students money, the federal government could just pay for the tuition without causing any significant economic problems. There is no fiscal reason why the student debt crisis should exist.

With a $150 million World Bank loan, the Ugandan government plans to construct roads to service oil companies, provide scholarships for oil workers and fund an oil institute. But what about helping its own people?

The Nordic nation of 5.6 million has been at the forefront of wind power innovation since the 1890s, when one of its leading scientists, Poul la Cour, began testing turbines.

Paying fees to attend university turns students into consumers and universities into privatized businesses – as the purpose of learning changes from a broad social good to become [one] based on creating profits.”

Posted 6 days 22 hours ago

A new pamphlet, released today, is an attempt to answer this question – and the case we make is, yes, it not only makes sense to think of planetary control in these terms, but it is essential.

Posted 2 days 21 hours ago

350.org founder Bill McKibben breaks down this week's announcement from President Obama and Premier Xi – which he calls a sign that public pressure is working, and that we need to apply much more.

Posted 6 days 22 hours ago
money in politics, dark money, Patriot Majority USA, Super PACs, campaign funding, National Education Association, AFL-CIO, Laborers National Headquarters, International Union of Operating Engineers, U.S. Chamber of Commerce, VoteVets.org Action Fund, Ame

Not all dark money is the same – meaning the imbalance of disclosure requirements give corporations and wealthy individuals greater secrecy in elections than organized labor.

Posted 6 days 22 hours ago

With animal agriculture as the leading cause of species extinction, water pollution, ocean dead zones and habitat destruction, becoming vegan is the most important and direct change we can immediately make.

Posted 6 days 22 hours ago
money in politics, dark money, Patriot Majority USA, Super PACs, campaign funding, National Education Association, AFL-CIO, Laborers National Headquarters, International Union of Operating Engineers, U.S. Chamber of Commerce, VoteVets.org Action Fund, Ame

Not all dark money is the same – meaning the imbalance of disclosure requirements give corporations and wealthy individuals greater secrecy in elections than organized labor.

Last week was a turning point in a seven month campaign to save the Internet – proof that even in a government corrupted by money, united and mobilized people who act strategically with creative tactics can win.

With animal agriculture as the leading cause of species extinction, water pollution, ocean dead zones and habitat destruction, becoming vegan is the most important and direct change we can immediately make.

"It's a nuisance smell in the area. It's a smell that's traveled quite far," said Jeff Suggs, emergency management coordinator for La Porte, where the company's accident occurred.

While celebrating the historic anniversary in Prague on Monday, thousands of Czechs called for President Zeman to step down.

Sign Up