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AFPComment_CMS–9989–P_Exchange

AFPComment_CMS–9989–P_Exchange

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 Centers for Medicare & Medicaid ServicesDepartment of Health and Human ServicesFile code: CMS–9989–PDate: August 17, 2011
Americans for Prosperity Comments Regarding: Patient Protection and AffordableCare Act; Establishment of Exchanges and Qualified Health Plans
To Whom It May Concern:Americans for Prosperity (AFP) is a free market non-profit organization that is committed toeducating and engaging grassroots citizen activists across the country to advocate for smallergovernment, lower taxes and free enterprise. We believe that the free market is and always hasbeen the true path to prosperity. With the nation struggling to regain its economic footingfollowing the recent recession, AFP believes reinvigorating the core American values of entrepreneurship, self-reliance and constitutionally-restrained government are central to thenation’s resurgence. AFP currently has more than 1.8 million members in all 50 states, includingour 31 chapter and affiliate states.In 2010, the country witnessed one of the most aggressive legislative battles in a generation, withunified Democratic governance advancing a health care reform bill that divided the nation and jeopardized individuals’ control of their health care choices.
1
AFP worked tirelessly inopposition to this legislation because we were concerned that it would create unnecessarycentralization and government control of the health care market. One aspect of centralizationthat concerns us is command-and-control regulation that puts bureaucrats between patients anddoctors. While examining the Affordable Care Act (the Act), Philip Klein from
The AmericanSpectator 
found “more than 700 instances in which the Secretary is instructed that she ‘shall’ dosomething, and more than 200 cases in which she ‘may’ take some form of regulatory action if she chooses. On 139 occasions, the law mentions decisions that the ‘Secretary determines.’”
2
 AFP remains concerned about this broad delegation of rulemaking authority to the Departmentof Health and Human Services (the Agency) and the spate of regulations that is sure to result.It is in this context that AFP submits comments in regard to the Agency’s proposed rule: PatientProtection and Affordable Care Act; Establishment of Exchanges and Qualified Health Plans.
3
 
1
The Patient Protection and Affordable Care Act of 2010, Pub. L. No. 111-148, 124 Stat. 119 (2010)
as amended by
 the Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111–152, 124. Stat. 1029 (2010).
2
Philip Klein,
The Empress of ObamaCare
, A
M
.
 
S
PECTATOR
, June 2010,
available at 
 http://spectator.org/archives/2010/06/04/the-empress-of-obamacare.
3
76 Fed. Reg. 41866 (2011) (to be codified at 45 C.F.R. pts. 155-56) (proposed July, 15, 2011).
 
Lack of Real State Flexibility
AFP’s major concern with the proposed rules is the lack of true state flexibility. Although theAgency went out of its way to give the appearance of flexibility, in many of the importantExchange features the Agency has retained control. The Agency has created a “significantchange” test that limits a state’s ability to alter or control its own Exchange without Agencynotification and approval.
4
The Agency provides a non-exhaustive list of “significant changes”in the proposed rule that includes: key operation functions, timeframes for crucial functions,Exchange governance structure, state laws or regulations, IT systems or functionality, QHPcertification procedures and QHP enrollment processes.
5
 Discretion is meaningful only if states have the authority, autonomy and freedom to use it as theywish. States are free to exercise “substantial discretion” with respect to their Exchanges underthe proposed rules, but only within a tightly-prescribed box of federal regulations and restrictionspromulgated by the Agency, and only with Agency approval of even seemingly mundane detailsof Exchange operations. Telling states what to do, how to do it and then giving them“discretion” to run the Exchanges when the only “choices” are to follow the Agency’s detaileddirections or face a federal takeover is “discretion” only in the most Orwellian sense.AFP encourages the Agency to adopt an Exchange management structure that provides stateswith autonomy to innovate, adapt and self-manage the Exchanges with virtually no approvalrequired from the Agency. States are more in tune with their health care markets, citizens’ needsand existing governance structures than the Agency can ever be. It is crucial to the maintenanceand availability of quality health care coverage and insurance that the 50 states be free to makechanges as needed without Agency bureaucrats standing in the way.
Section 155.105: Approval of a State Exchange
AFP believes that the Agency has not provided the states with sufficient time to establishExchanges, while at the same time using the specter of an explicit federal takeover of theExchanges to prod states into action. The Act and the proposed rule both dictate that the Agencymust determine by January 1, 2013 whether states have complied with the Agency’s directive toestablish an Exchange.
6
However, the Agency envisions a 90-day window during which theAgency will evaluate a state’s Exchange plan. This means states will need to submit finalExchange plans to the Agency by October 2012. If states want to ensure they will have time toreply to Agency comments and alter their final Exchange plans they will need to build in another30-60 days lead time; pushing the deadline up to August 2012. AFP believes that given theseries of Exchange regulations still to come—along with associated notice-and-comment andreply comment periods—this deadline less than a year from now is simply not attainable. Wefear that the Act and the Agency are pushing an accelerated timeline that will jeopardizecoverage and inject more uncertainty into the health care marketplaces. We also feel that theproposed rule’s conditional approval process will simply drag out this uncertainty.
7
 
4
P
ROPOSED
R
ULE
,
supra
note 3, at 41871.
5
 
 Id 
.
6
A
FFORDABLE
C
ARE
A
CT
,
supra
note 1, at § 1321(c) and P
ROPOSED
R
ULE
,
supra
note 3, at 41867.
7
P
ROPOSED
R
ULE
,
supra
note 3, at 41871.
 
Federalism Concerns
 With the states lacking meaningful discretion and facing an unrealistic timeline to comply withhundreds of pages of yet-to-be-released regulations, AFP is deeply concerned that the Act andthe Agency’s proposed rules will supplant state authority over the health insurance industry. Thefederal government is abusing the limits of federal power relative to the states, threatening tomake states the administrative arm of the federal government. The Supreme Court discussed thedangers and ahistorical nature of this type of federal overreach, writing:[T]he Framers rejected the concept of a central government that would act uponand through the States, and instead designed a system in which the state andfederal governments would exercise concurrent authority over the people … TheFramers explicitly chose a Constitution that confers upon Congress the power toregulate individuals, not States. The great innovation of this design was that ourcitizens would have two political capacities, one state and one federal, eachprotected from incursion by the other.
8
 The Agency is endangering that constitutional design by using the blunt weapon of a federaltakeover of the Exchanges—which affects a vast portion of any state’s economy, its budget andthe welfare of its citizens—as the inducement to comply. The proposed rules in practice appearto merely tighten the federal grip on health care, taking more power away from the states in oneof the few areas of public policy where they still have some meaningful role. AFP urges theAgency to respect the Constitution’s federalist spheres of authority and exercise the discretionthe Act gives the Agency to allow the states to manage their Exchanges and health care markets.
Section 155.405: Single Streamlined Application
In the proposed rule’s section on streamlined applications, the Agency requests comments on“whether [the Agency] should codify a requirement that applicants may not be required toanswer questions that are not pertinent to the eligibility and enrollment process.”
9
AFP believesthat this information protection does not go far enough. The Agency should not stop at simplycodifying that applicants
may not be required to answer 
non-pertinent questions. We believe theAgency should codify a requirement that these single streamlined applications
may not 
 
ask 
anyquestions that are not relevant to eligibility and enrollment. AFP understands that ourrecommendation restricting Exchanges’ ability to collect non-relevant personal informationcreates tension with our recommendation for state flexibility. However, as AFP discussed in ourseparate comment on the proposed rule for Standards Related to Reinsurance, Risk Corridors andRisk Adjustment, use and abuse of individuals’ personal information is a very large concern withthe Exchanges the Act envisions. We urge the Agency to take all possible steps to limit theamount of extraneous patient information that Exchanges can capture.
8
 
Printz v. United States
, 521 U.S. 898, 919-20 (1997).
9
P
ROPOSED
R
ULE
,
supra
note 3, at 41881.

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