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Christie vetoes Obamacare provision

Gov. Christie became the first governor in the country today to veto a bill that would set up a state-run health care exchange. Such exchanges, which are intended to group consumers together to get deals on health insurance, was a key provision of the Obamacare health reform. Ten states have so far enacted health care exchanges, a handful of legislatures have rejected the exchanges and many states (including Pennsylvania) have legislation pending.

Christie vetoes Obamacare provision

President Obama is joined by Gov. Christie in crossing the Temple Street Bridge in Paterson last September. The Passaic River had washed over the bridge and flooded the downtown, forcing hundreds to evacuate.
President Obama is joined by Gov. Christie in crossing the Temple Street Bridge in Paterson last September. The Passaic River had washed over the bridge and flooded the downtown, forcing hundreds to evacuate.

Full story in Friday's paper, here.

No ChristieCare for New Jersey.

Gov. Christie became the first second governor in the country today to veto a bill that would set up a state-run health care exchange. Such exchanges, which are intended to group consumers together to get deals and offer choices on health insurance, was a key provision of the Obamacare health reform. Ten states have so far enacted health care exchanges, a handful of legislatures have rejected the exchanges and many states (including Pennsylvania) have legislation pending.

Christie rejected the bill, passed by the Democratic Legislature, for several reasons, including the fact that the U.S. Supreme Court is set to rule on Obamacare in the coming weeks. “I am concerned that a hastily created exchange in New Jersey will impose unnecessary obligations upon the State’s taxpayers,” Christie said. “The very constitutionality of the Affordable Care Act is cloaked in uncertainty, as both the individual mandate to procure health insurance as well as the jurisdictional mandate to establish an exchange may not survive scrutiny by the Supreme Court.”

In recent days the bill had become topic du jour among tea partying Christie watchers. If he didn't veto this bill, they argued, he would be responsible for creating "ChristieCare" in New Jersey. 

“First, we had RomneyCare. Next, we had ObamaCare. If the governor does not veto the health care exchange bill on his desk we might as well call it ChristieCare in New Jersey,” said Steve Lonegan, who had challenged Christie from the right in the 2009 gubernatorial primary, in a statement yesterday. Lonegan is the state director of Americans For Prosperity, which is affiliated with the conservative Koch brothers, who in the past have also expressed their support for Christie.

In an article for the conservative Daily Caller, the director of health policy studies for the libertarian Cato Institute (where Christie was honored last week, incidentally), upped the ante further, writing yesterday: "...it’s not an exaggeration to say that how New Jersey handles this legislation could determine whether Obamacare lives or dies. Obamacare can only work if states do the heavy lifting."

Assemblyman Herb Conaway (D., Burlington), a doctor and one of the sponsors of the bill, said this afternoon that “the governor has sent a clear message to the 1.3 million uninsured New Jerseyeans and the many others who are underinsured and struggle to afford their existing insurance: He doesn’t care."

“Health care is not a commodity. No one should have to choose between their health and paying their bills...By vetoing this bill, Gov. Christie has failed New Jersey’s uninsured residents, hurt New Jersey’s chances of fully benefiting from federal health care reform and ignored the need to provide relief to hospitals for uncompensated care. I am disappointed that Gov. Christie put national political pressures ahead of the well-being of New Jersey. His actions have once again shown his complete disregard for our most vulnerable populations.”

It should ne noted that if a state does not set up an exchange, the federal government will create one in that state.

Here's the full text of the governor's veto:

May 10, 2012

ASSEMBLY BILL NO. 2171

(Second Reprint)

To the General Assembly:

In March of 2010, after significant public debate and 

discourse, a sharply divided Congress passed the Patient

Protection and Affordable Care Act, which was swiftly signed

into law. The “Affordable Care Act” represents a far-reaching

and expansive alteration of the nation’s health care system.

Among its many provisions is the requirement that every person

across the country obtain and maintain basic health insurance.

To achieve this goal, the Affordable Care Act imposes sweeping

revisions to almost every facet of private health insurance and

public health infrastructure at the national, state, and local

levels. Critical to these changes is the directive that a

“health insurance exchange” must be established in each state.

While states have the option to craft their own version of these

exchanges, they must be consistent with the terms and

limitations imposed by the Affordable Care Act. If a state

fails to act to adopt these requirements, the federal government

will step into the state to establish programs it deems

acceptable, with the costs of these programs passed along to the

state’s citizens.

Faced with these new federal laws, both the New Jersey

Legislature and my Administration have appropriately worked to

identify the most balanced, cost-effective, and medically sound

approach towards compliance. Assembly Bill No. 2171, passed by

the Legislature on March 15 of this year, seeks to address some

of these challenges by creating the “New Jersey Health Benefits

Exchange Act” to implement the core provision in the federal

Affordable Care Act: the requirement that every citizen in New

Jersey purchase and maintain health care coverage.

Prudently, throughout the process leading to the passage of

Assembly Bill No. 2171, the scope of the Affordable Care Act and

its central component – the “individual mandate” – were deeply

debated and thoughtfully examined by members of the Legislature,

health care experts, private insurers, academics, and the

citizens of New Jersey who will finance the bill’s provisions.

Critically, the robust debate in our State echoed the national

conversation between policy makers and the people about the

effectiveness of many of the Affordable Care Act’s provisions.

Then, on March 26 of this year, just ten days after the passage

of Assembly Bill No. 2171, the Supreme Court of the United

States began an unprecedented three days of hearings, where the

same arguments and questions concerning the lawfulness of both

the individual mandate, and the health care exchanges necessary

to deliver that coverage, were presented to the highest Court in

the land for resolution.

While I appreciate the Legislature’s attempt to find steady

policy footing in these shifting legal sands, I am concerned

that a hastily created exchange in New Jersey will impose

unnecessary obligations upon the State’s citizens. Indeed, the

very constitutionality of the Affordable Care Act is cloaked in

uncertainty, as both the individual mandate to procure health

insurance as well as the jurisdictional mandate to establish an

exchange may not survive scrutiny by the Supreme Court. Because

it is not known whether the Affordable Care Act will remain, in

whole or in part, it would be imprudent for New Jersey now to

create an exchange before these critical threshold issues are

decided with finality by the Court.

The uncertainty created by the litigation challenging the

Affordable Care Act is reflected in many aspects of Assembly

Bill No. 2171. For instance, the bill commits New Jersey to

establishing and operating a new Medicaid-like program for

individuals between 133% and 200% of the federal poverty level,

without any assurance of the level of federal funding that will

be available to support such a plan. Moreover, the bill’s

mechanism for certifying health plan participation in the

exchange limits the pool of plan participants, which will likely

reduce options and increase costs. Likewise, the composition of

the proposed exchange’s board of directors lacks representation

by all stakeholders and improvidently provides a salary of

$50,000 to each board member, further increasing implementation

expense. In all, with basic issues regarding the future of the

Affordable Care Act unresolved, it is impossible to know whether

this legislation best suits the interests and needs of all New

Jerseyans who will be required to finance these policy choices.

The fundamental uncertainties inherent in the Affordable

Care Act during the Supreme Court’s deliberations counsel

against premature action, just as they should have slowed the

rush to pass this bill. Indeed, while many have publicly

questioned both the future of the Affordable Care Act and the

corresponding efficacy of the bill’s provisions, the Legislature

nonetheless pushed this bill forward to my desk. I believe that

the better course of action for New Jersey is to continue to

monitor the ever-changing landscape surrounding the

implementation of the Affordable Care Act, and to refrain from

imposing its mandates upon our citizens until outstanding issues

are settled, and the required course of action is clear.

While I am unwilling to approve the establishment of a

statewide health insurance exchange at this time, I am mindful

that the requirements of the Affordable Care Act still stand

today and I intend to fully oversee New Jersey’s compliance in a

responsible and cost-effective manner should its

constitutionality ultimately be upheld by the Supreme Court.

Despite the serious questions of legality that have followed the

Affordable Care Act since its signing, my Administration has

been studying sensible approaches towards ensuring New Jersey’s

compliance with the federal law since the spring of 2010. At

that time, I directed the establishment of an interdepartmental

working group, which includes the Departments of Banking and

Insurance, Health and Senior Services, and Human Services to

meet regularly and to coordinate the State’s efforts towards

implementing the Affordable Care Act. My Administration will

continue this work and stands ready to implement the Affordable

Care Act if its provisions are ultimately upheld.

For all these reasons, committing New Jersey to the

establishment of a statewide exchange under the provisions of

this bill is premature. Accordingly, pursuant to Article V,

Section I, Paragraph 14 of the New Jersey Constitution, I am

returning Assembly Bill No. 2171 (Second Reprint) without my

approval.

Respectfully,

[seal]

/s/Chris Christie 

Governor

Attest:

/s/Charles B. McKenna

Chief Counsel to the Governor

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