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Health Care / Free-Market Reform

Missouri’s Attorney General Should Join Health Care Reform Lawsuit

By Christine Harbin on Jan 11, 2011

When Missourians passed Proposition C last August with more than 71 percent of the vote, they signaled opposition to the individual health insurance mandate that is central to the federal health care reform law adopted by Congress earlier this year. Policymakers in Missouri should take steps to represent their constituency’s resounding opposition to the measure. Missouri’s attorney general, Chris Koster, has the opportunity to do just that by joining 20 other states in a Florida lawsuit against Obamacare. Governors and attorneys general who decide to participate have until January 10 to join the suit.

There are many reasons why Missouri should join the health care reform lawsuit. The individual mandate requiring Americans to carry insurance overreaches the federal government’s authority under the Constitution’s commerce clause. Health care is just one among the many goods and services that individuals in Missouri consume, and courts have never interpreted the commerce clause as giving lawmakers the authority to require individuals to purchase a product.

The case that’s being heard in Florida is one of the few among the two dozen pending challenges to the new health care reform law that also contests the law’s expansion of eligibility requirements for Medicaid, the joint federal-state health insurance program for the poor. Expanding Medicaid would burden the state budget, and may exacerbate the existing deficit. Lawmakers in Missouri have already made cuts to education and public safety, and other cuts to essential services — or increased taxes — could be necessary if the Medicaid program were expanded.

Medicaid is already one of the largest expenses in Missouri’s budget, and the new health care law depends on an expansion of Medicaid for its projected increase in insurance coverage. In fiscal year 2008, Medicaid spending in Missouri totaled more than $7.09 billion. The federal government pays for the majority of the expenditures, but Missouri taxpayers covered $2.66 billion, or more than 12.5 percent, of the state’s total $21.2 billion budget. Although the law initially requires the federal government to absorb the full cost of the expansion, states could eventually pay 10 percent.

The states that are party to the health care reform lawsuit argue that the law impinges on state sovereignty by requiring the use of state funds to cover a much larger share of low-income people through Medicaid. Not only does it undermine state autonomy, it is also unnecessary.

There are alternative ways to provide health care to uninsured and low-income populations without restricting individual liberties and freedom of choice. When the government allows more competition and choice in insurance markets, people can better choose how to balance cost with their own relative tolerance for risk. One successful strategy would be to eliminate the way in which insurance is tied to employment, and instead encourage health savings accounts (HSAs), which would allow individuals to purchase portable, cost-effective policies, save for foreseeable health-related expenses, and hedging against unknown future risk.

Top-down, centralized plans can’t take into account the many varied needs and preferences of the hundreds of millions of people such plans will inevitably affect. By signing on to this Florida lawsuit, Attorney General Koster can help signal that Missourians are capable of making their own health insurance decisions without an intrusive federal mandate.

Christine Harbin is a policy analyst for the Show-Me Institute, an independent think tank promoting free-market solutions for Missouri public policy.

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Christine Harbin

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