By Brian Sikma

The American health care system, already in need of serious reform, was dealt a blow by the passage of the Patient Protection and Affordable Care Act of 2009, better known as Obamacare. At its core, Obamacare eliminates the role that states have traditionally played in regulating their own health insurance markets, and imposes draconian mandates that states must comply with. If these mandates are not implemented, the state will face federally imposed regulations that supersede their own established structures. Building outward from the individual mandate that requires every American to purchase a health insurance plan that complies with federal standards, Obamacare forces states to change their health insurance regulations and create so-called exchanges that administer the buying and selling of health insurance.

Wisconsin is in the process of debating how it should voluntarily conform to the constitutionally questionable, and fiscally unworkable, demands of Obamacare. Legislative leaders have advanced AB 210 as the first step in the compliance process. The bill achieves a sweeping rewrite of Wisconsin’s health insurance regulations, and lays the foundation for an Obama administration-imposed health insurance exchange.

Before Wisconsin rushes to voluntarily comply with Obamacare even before federal court remedies are exhausted, policymakers and lawmakers would be wise to remember the words of Congressman Paul Ryan who said in January of this year that Obamacare is a “fiscal house of cards,” full of “smoke and mirrors.” The following is a point-by-point review of the arguments proponents of AB 210, as it stands amended, are using to suggest such “smoke and mirrors” public policy become the law in Wisconsin.

Argument 1: If Wisconsin fails to accept Obamacare, Wisconsinites will be required to file insurance disputes with federal officials in Chicago starting January 1, 2012.

Response 1: This is a matter of geography, not substance. It is a mistake to assume that any Wisconsin legislation can substantially improve the ability of Wisconsinites to have more of a say in the insurance dispute resolution process. The federal process for insurance dispute resolution is forced onto the states by Obamacare and if states refuse to comply 100% with that process, the federal government will revert to using its own powers in this area. AB 210 simply allows Wisconsinites to follow the dictates of Obamacare in Wisconsin instead of following the dictates of Obamacare via a bureaucrat in Chicago. That’s not a real choice.

Argument 2: If Wisconsin does not comply with Obamacare, the federal government will impose Obamacare on Wisconsin and the state will concede its rights in this area to the federal government.

Response 2: Federal law already trumps state health insurance law according to Obamacare. If Wisconsin must comply with Obamacare in order to preserve its right to act outside the parameters of Obamacare that is a contradicting argument. While attempting to use the 10th Amendment’s protection of federalism as an argument, this logic fails to understand the very essence of the new federal mandates. Obamacare has created a bold new brand of bureaucratic tyranny, and it will remain in force until PPACA is repealed, found unconstitutional, or defunded.

Argument 3: AB 210 has been amended to slow down the process of implementing an exchange and changes to health insurance rules.

Response 3: Running out the clock a little bit more does nothing to improve the underlying bad public policy behind Obamacare. Accepting all the baggage that comes with the bill is not offset by a few gains in scheduling the imposition of reform. If time really was of concern, lawmakers would perhaps refuse to consider a bill similar to AB 210 until all sought out federal court remedies regarding the individual mandate were exhausted. If the individual mandate is found unconstitutional the workability of Obamacare would unravel, and Congress would be forced to expeditiously revisit PPACA and ponder ways to amend or repeal it. Such Congressional action would have a direct impact on the compliance measures being contemplated by the Wisconsin legislature.

Argument 4: Without AB 210 in place, insurance companies would be forced to report some information to the federal government that they otherwise would not be required to report.

Response 4: This is a minor point, and one that is not worth conceding an entire state prerogative over. Insurance companies could lobby the federal government to remove information sharing requirements that they find distasteful. Doing that would certainly respect the best interests of Wisconsinites to a greater degree than turning the entire Wisconsin health insurance structure on its head by voluntarily embracing every major and substantial element of Obamacare.

Argument 5: AB 210 requires legislative action before a health insurance exchange may be imposed on Wisconsin.

Response 5: Under PPACA, a Wisconsin exchange must reflect non-negotiable federally dictated standards. Whether the state vests the authority to establish such an exchange in the legislative or executive branch makes little difference. The only end result that will pass federal Health and Human Services review will be a plan that fully complies with Obamacare. That standard exists regardless of whether or not the plan comes from the executive branch or the legislature. According to HHS Secretary Kathleen Sebelius, state input doesn’t matter when exchanges are formulated. The Heritage Foundation noted that: “In truth, the proposed regulations [for exchanges] don’t give states any additional flexibility beyond what they are permitted under Obamacare anyway, and in some places they may further limit state lawmakers’ options.” Emphasis added.

Argument 6: Recall elections have created uncertainty about the sustainability of the present balance of power in Madison. Hurried enactment of AB 210 would lead to some level of free-market policies in Wisconsin’s compliance with Obamacare.

Response 6: As stated before, Obamacare does not allow for truly free-market developments in state health care policy. Michael Cannon of the Cato Institute explained the issue in crystal clear language to the Missouri legislature:

The fact that an Exchange is state-run does not diminish federal control by one iota. There is nothing that a federal Exchange can do that the federal government cannot also force a state-run Exchange to do through regulation.

Although AB 210 does not establish an exchange, it is vain hope to believe that the foundation it lays for such an exchange will lead to a free market exchange.

With respect to political considerations, basing far-reaching public policy decisions on the potential likelihood of hypothetical political outcomes speaks more of probable political cowardice than political courage or foresight. Many lawmakers campaigned on the premise that they would change the way Madison functions. This kind of reasoning reflects Madison politics as usual and is diametrically opposed to the kind of courageous decision-making that characterized the collective bargaining reforms of earlier this year.

Argument 7: The sunset provisions of AB 210 provide ample protection for Wisconsinites, and state law and regulatory structures relating to health insurance will revert to pre-AB 210 standards if ObamaCare is repealed or found unconstitutional either in whole or in part.

Response 7: Placing a sunset provision on terrible public policy does not automatically make such public policy in the genuine public interest. Instead of a complete surrender to Obamacare, Wisconsin would be better served by sunset policy that is comprised of a no-compliance policy with Washington’s heavy-handed dictates.

In sum, Obamacare will be felt in Wisconsin because the federal government will eventually impose health insurance regulatory reform and an exchange system that reflects the priorities of the Obama administration. AB 210 only gives the Obama administration cover and further legitimizes their attempts to dictatorially impose a policy failure on the states. Wisconsin should live up to its history as an independently thinking state and refuse to quietly and unquestioningly accept the failures that Washington wishes to force it to “voluntarily” accept.

The best remedy for the heath care reform disease known as Obamacare is to quarantine its failures at the national level while state policymakers refuse to spread the infection to Wisconsin state law and public policy.