Health insurance reform under Republican leadership is as much about healthcare as it is about political ideology. This is why the GOP healthcare overhaul incorporates an attempt to shift regulatory control back to the States. Republicans argument that State control places decisions in the hands of State officials who better understand their local economies. In many respects, the logic is sound. Unfortunately, special interest groups often have a far greater presence in State capitals than than they do in Washington while State lobbyists receive far less scrutiny than Federal lobbyists. With such undue influence, State regulation does not necessarily reflect the interests of State residents.
To boot, a lack of regulatory consistency between State markets can impose costly complexities onto industry as well as limit the ability of insurers to offer far more robust insurance plans with far reaching coverage. National standards are needed for the health of the insurance industry and consumers. The Commerce Clause, which empowers Congress to regulate commerce between the many States, exists in the US Constitution, because technical barriers like regulatory disparities impede inter-state trade. For their part, many Republicans do want to make it easier for insurance companies to sell across State lines. If done properly, it is a policy shift that could transform the insurance industry, empower consumers, and ease regulatory burdens.
The healthcare and health insurance industries are heavily regulated, which is more than understandably. The decisions of insurers and healthcare providers are, after all, a matter of life and death. Regulation should, however, achieve clear and constructive goals by imposing the lowest costs possible. The inability of insurance providers to sell across State lines limits consumer choice and raises costs by forcing insurers to operate in every State they wish to conduct business. It raises the overhead for insurance providers by fostering the growth of unnecessary infrastructure and administrative hurdles. With robust national standards established by the Federal government, the ability of insurers to more readily sell across State lines means consumers can have more options without sacrificing the quality of their insurance.
Imposing Federal standards on insurance providers can also eliminate the massive regulatory hurdles placed on the insurance industry by States. In general, favoring a Federal approach to regulation over patch-work approach of varying State regulations would lessen the complexity and cost of regulation. For Republicans, it does mean sacrificing State rights, yet the sacrifice means States can focus on protecting consumers. The reason Conservatives favor State and local governance over Federal governance is that the more local a governments is, the more directly it represents the interests of their constituents. In other words, local and State governments, which represent fewer people than the Federal government, are closer to the People.
If usurping the rights of States means empowering the People more directly, protecting State authority undercuts individual right and free enterprise. Recognizing States’ Rights are indispensable, because States’ Rights enable States to ensure the rights of individuals, it is ill-rationale to protect States Rights over individual rights. The Federal government should set appropriate standards for all industries, but it is up to the State government to represent their constituents and use State resources to ensure consumer protection. Where Federal standards fail to address the interests of individuals, the State should act.
Respecting the rights of States means the Federal government must preserve the powers reserved for the States, but the Federal government should not honor and promote States’ Rights over individual rights. The Commerce Clause gives the Federal government the power to regulate commerce between States, which it should. The States should protect the rights and freedoms of individuals by submitting to Federal authority when doing so is necessary and proper. States should impose additional regulation when Federal regulation fall sort, yet States should also defend against Federal overreach. In the case of health insurance, the States need to yield in order to afford consumers greater choice, yet States should always act whenever the Federal government fails to protect individual consumers.
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