Policy Documents

The Leaflet: Post-Election Health Care Policy

November 1, 2012

Next week is the election that will bring hundreds of new lawmakers into office at the state level. Looming large for states is the outcome of the presidential election. The outcome, regardless of who wins, will guide public policy at the state level for the next four years. This is especially true of health care, with the future of the Patient Protection and Affordable Care Act (PPACA) hanging in the balance.

Since the passing of PPACA, state lawmakers have asked Heartland what they should do about implementing parts of the law, such as state health care exchanges. With so many unanswered questions regarding legality and how the federal government would regulate these exchanges, Heartland advised states to hold off until the Supreme Court made a ruling.

Many experts, including our own, thought that ruling would clear up some of the questions. Instead it created more, including whether or not states should expand Medicaid now that they couldn’t be forced to do so. Since the ruling, Heartland experts have continued to caution states about the pitfalls of implementing an exchange that doesn’t actually give states flexibility and expanding a Medicaid system that is already straining state budgets.

With so many questions regarding what the election will mean for health care and other issues, Heartland will be hosting our monthly Emerging Issues Conference call on Wednesday, November 7 at 1:00 p.m. EST. Heartland Research Fellow Benjamin Domenech will give some reactions to what the election means for public policy at the state level and then take your questions. To RSVP, please email Robin Knox at rknox@heartland.org to make sure that you receive all the information for the call.

This week's edition of The Leaflet features research and commentary addressing post-election health care decisions, frac sand mining, Parent Trigger design guidelines, high-speed rail, territorial taxation, and broadband taxes.


John Nothdurft
Director of Government Relations


Lead Story

Research & Commentary: Post-Election Health Care Decisions
Health Care

As President Barack Obama and Republican nominee Mitt Romney vie for the presidency, state elected officials are preparing to determine which health care policies they should pursue with the future of the Patient Protection and Affordable Care Act (PPACA) dependent on the upcoming election.

Key decisions for states have been whether to implement a health insurance exchange and expand their Medicaid programs. Proponents argue these measures will allow for greater access to health care at lower costs. Opponents say that regardless of who wins the election, it will not be beneficial for states to take either step.

Health insurance exchanges consistently have failed to cut costs for consumers and state governments. In Utah’s health insurance exchange, for example, which is not subject to the heavy regulations of the federal health care law, health insurance was more expensive than on the open market. And Massachusetts spent more than $29.4 million in 2009 alone on the Commonwealth Connector, in addition to the program’s significant administrative costs.

Implementing a state-crafted exchange will not give a state greater authority over its health care system, because all exchange operations are subject to federal approval and oversight.

Similarly, expanding Medicaid programs will not benefit a state even if Obama is reelected and PPACA is fully implemented. According to a Heritage Foundation report, Medicaid populations in 33 states will increase by 30 percent and in 10 states by 50 percent if they go through with expansion. A study from Americans for Prosperity showed expansion would cost states approximately $21 billion just from 2014 to 2019, and full federal coverage of new enrollees will end in 2020, leaving states to pay the difference.

No matter who wins the presidency, states should not implement an exchange that will further bury their residents with higher health care costs, nor expand Medicaid, a program already proven financially unsustainable.


What We're Working On 

Research & Commentary: Silica (Frac) Sand Mining

Wisconsin, Minnesota, Illinois, and other Midwest states are becoming players in the nation’s energy outlook. Not necessarily because of their energy resources, but because of their generous supply of silica sand, also known as “frac” sand, a main ingredient in fracturing fluid used in the energy extraction process known as hydraulic fracturing. Although hydraulic fracturing, in partnership with horizontal drilling and other technologies, has led to an energy boom in the United States, many environmental activist groups seek to ban sand mining operations in several parts of the Midwest. Policy Analyst Taylor Smith explains why this is a bad idea.

“The United States has a large supply of high-quality silica sand located in Wisconsin,” Smith writes, “particularly near the western region of the state and overlapping into eastern Minnesota. Limiting or restricting access to this sand forces energy companies to resort to less-economical production choices, such as lower-quality sand from other states or expensive ceramic beads from China and Brazil. That eliminates job opportunities in Wisconsin while raising energy costs nationwide.”

Policy Brief: The Parent Trigger: Justification and Design Guidelines


This new Policy Brief from The Heartland Institute presents the rationale for empowering parents with Parent Trigger legislation and then offers design guidelines for parents and elected officials interested in crafting legislation for their city or state. Why is parental involvement so important? Heartland Research Fellow Joy Pullman explains.

“Parental involvement has been shown empirically to be effective in improving schools and raising student achievement,” Pullman writes, “yet it is routinely blocked and discouraged by public school systems.”


Research & Commentary: High-Speed Rail
Budget & Tax

In 2009 in the American Recovery and Reinvestment Act (ARRA), Congress allocated $8 billion to send to states for intercity rail projects, with “priority to projects that support the development of intercity high speed rail service.” In pursuit of these federal grants, several state and regional high-speed rail plans emerged. In this Research & Commentary, Senior Policy Analyst Matthew Glans examines high speed rail, the plans being considered and the effectiveness of high speed rail as a means of transportation in the United States

As Glans explains, “High-speed rail is an expensive endeavor with questionable benefits for taxpayers. Instead of subsidizing the construction of new high-speed rail lines that are less efficient than other forms of transportation, the government should focus on maintaining and improving our current highway and air systems, which are well established, in demand, and in dire need of repair.”

Research & Commentary: Worldwide vs. Territorial Taxation
Finance, Insurance and Real Estate

The United States has the highest corporate tax rate among the 34 nations in the Organisation for Economic Co-Operation and Development (OECD) in addition to being one of the few nations still using a “worldwide system.” These are two reasons the United States is in dire need of fundamental corporate tax reform.

In this Research & Commentary, Glans examines both worldwide and territorial tax systems. His assessment: “Our current worldwide tax system puts the United States at a competitive disadvantage versus other nations with lower, less-complicated corporate tax rates. Switching to a territorial system would make the United States more competitive by bringing foreign earnings back home to invest while encouraging more companies to set up headquarters here.”


FCC Tables Broadband Tax Proposal

Infotech & Telecom

In this Heartlander article, Tim Kelly discusses the Federal Communications Commission's decision to withdraw a proposal to tax broadband Internet service after a public outcry over the issue. Kelly speaks with several telecom experts who comment on how quickly all parties involved are moving to distance themselves from the unpopular proposal.

Steve Titch, a Heartland Institute policy advisor, argues in the article that the Connect America Fund may impede infrastructure development by distorting markets and subsidizing uncompetitive carriers. "As structured, the Connect America Fund will slow new investment in potentially competitive technologies while allowing incumbent rural carriers to profit from the grace of government largesse, not through their own innovation," Titch says.


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