Obamacare Architect: Govt Intended States to Handle Exchanges

Friday, 25 Jul 2014 05:01 PM

By Sandy Fitzgerald

  Comment  |
   Contact Us  |
|  A   A  
  Copy Shortlink
MIT economics professor Jonathan Gruber, one of the original Obamacare authors, said at least two years ago that states that don't offer their own insurance exchanges would not be able to offer residents subsidies to help them pay their premiums.

"In the law, it says if the states don't provide [exchanges], the federal backstop will," reports The Daily Caller, citing a video from a presentation the professor made in 2012.

"The federal government has been sort of slow in putting out its backstop, I think partly because they want to sort of squeeze the states to do it. I think what’s important to remember politically about this, is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits."

Gruber says the conditional feature for tax credits was added because there were people in Washington who wanted to "squeeze the states to do it," reports Forbes.

In the video, Gruber also says that taxpayers would pressure state officials to create exchanges so they can receive tax credits, and acknowledges the conditional nature alongside a requirement that the federal government establish exchanges within states that do not offer them.

Gruber also explains that the Obama administration might try to ignore that part of the law and admits the tax credits may not be enough of an incentive to get states to comply with forming exchanges.

There has been much confusion over the subsidy issue, with two rulings issued this week. A federal appeals court panel in Washington, D.C., found on Tuesday that people living in states that rely on the federal insurance exchange can't use subsidies to pay for their healthcare plans. Meanwhile, a second ruling, in a Virginia appeals court, found the opposite in a separate case.

Gruber pointed out that the federal government wanted to make states build their own exchanges, or take the blame for keeping their residents from getting subsidies that pay much of their healthcare coverage costs.

"But your citizens still pay the taxes that support this bill," he says in the video. "So you’re essentially saying to your citizens, you’re going to pay all the taxes to help all the other states in the country. I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges, and that they’ll do it. But you know, once again, the politics can get ugly around this."

Many Obamacare supporters, however, say Congress always wanted to provide subsidies through federal exchanges.

Gruber was hired by the Obama administration and worked with congressional staff to draft the Obamacare bill, and suggests that the idea of federal subsidies was not made in error, but was included as incentive for states to create their own exchanges.

And now, The Daily Caller reports, Gruber has called the idea that Congress did not mean to apply subsidies to states that use federally run exchanges "absurd."

Related Stories:

© 2014 Newsmax. All rights reserved.

  Comment  |
   Contact Us  |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
Zip Code:
Privacy: We never share your email.
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Jack Devine: I'm More Concerned About Hong Kong than ISIS

Thursday, 02 Oct 2014 12:49 PM

With protests underway in Hong Kong in an effort to get its chief executive to resign, former acting director of the CIA . . .

Michael Rubin: Iran Emulating N. Korea Negotiating Strategy

Thursday, 02 Oct 2014 12:37 PM

Iran's self-proclaimed negotiating strategy is modeled after North Korea's, which acquired nuclear weapons while "negoti . . .

Experts: Boehner Likely to Remain House Speaker

Thursday, 02 Oct 2014 11:57 AM

Republican House Speaker John Boehner will likely remain in the post after the midterms, according to conservative blogg . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

America's News Page
©  Newsmax Media, Inc.
All Rights Reserved