Tea Party Pressures Haslam on State Health Exchange

Tea partiers are pressuring Governor Bill Haslam to rule out running an insurance exchange. Under the federal healthcare overhaul, Tennessee officials can launch an exchange for the state, but if they don’t, Washington will – and Haslam has been slow to commit.

Tea-party groups and other conservative critics are planning a demonstration at the capitol in Nashville this Wednesday. They don’t want the state to play ball with the federal healthcare law by building an exchange. It would be an online store and database to help Tennesseans shop for insurance plans.

A spokesman says while Haslam doesn’t like the healthcare law either, he thinks the state could run its own exchange more efficiently than Washington. But the rules are murky, so Haslam has been holding out for clarity, ahead of a December 14th deadline to decide.

Critics note last year Haslam signed a law called the Health Freedom Act (PDF), meant to symbolically opt out of enforcing parts of the federal law. When pressed about it, Haslam’s administration argues the law does not legally bar a state-run exchange:

What are the implications of Tennessee’s Health Care Freedom Act to the decision as to whether to operate a state-based exchange?

While the Health Care Freedom Act at TCA § 56-7-1016(d) states that “No public official, employee, or agent of this state or any of its political subdivisions shall act to impose, collect, enforce, or effectuate any penalty in this state that violates the public policy set forth in this section,” federal law assigns to the IRS the exclusive role in imposing, collecting, and enforcing such penalties. See 26 USC §§ 5000A and 4980H as added by PPACA §§ 1501(a) and 1513(a), respectively. Thus, the Health Care Freedom Act does not prohibit a state-based exchange in this context.