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The Ties That Bind
Written by Jeff Horn   
Monday, 05 December 2011 21:21

People around the state are questioning why Wisconsin hasn't returned the $38 million Early Innovator Grant awarded by HHS earlier this year to help Wisconsin implement a PPACA State Health Insurance Exchange.  To most, it's common sense that you just don't get something for nothing... especially when dealing with the federal government.

Still, the folks over at the Office of the Commissioner of Insurance (OCI) keep saying that there are "no strings" attached to this money.

Frankly, this is just plain nuts!  You see, the very first page of the grant documentation reads:

"This Funding Opportunity Announcement (FOA) will provide competitive incentives for States to design and implement the Information Technology (IT) infrastructure needed to operate Health Insurance Exchanges"

Perhaps OCI is unaware of what it means to implement something?  Well, "implement" is a verb meaning "to put into effect according to or by means of a definite plan or procedure."  The federal government is clearly expecting Wisconsin to deliver the goods.  They want and expect access to software that implements a health insurance exchange.

Reading the grant application a bit further (p. 18), we see just why they want the software implemented:

“Under 45 CFR 92.34 HHS retains a royalty-free, nonexclusive, irrevocable license to reproduce, publish or otherwise use and authorize others to use, for Federal Government purposes, the copyright in any work developed under the grant, or a subgrant or subcontract, and in any rights to a copyright purchased with grant support. HHS shall be provided with a working electronic copy of the software (including object source and code) with the right to distribute it to others for Federal purposes consistent with and throughout the execution of the Cooperative Agreement”

They want Wisconsin to implement health exchange software, so that they can use it royalty free!  Just where are they going to use it?  The grant rules spell that out too!

"These 'Early Innovator' States will develop Exchange IT models, building universally essential components that can be adopted and tailored by other States." (p. 4)


"The Exchange IT system components (e.g., software, data models, etc.) developed by the awardees under this Cooperative Agreement will be made available to any State" (p. 5)

HHS wants to use health insurance exchange software developed here to spread the Obamacare joy to the other states in our nation!

Some even believe that, since PPACA itself does not provide funds for developing the federal exchange that HHS threatens states with should they not implement a state exchange, HHS will use exchanges developed by Early Innovators as a basis for a federal exchange.

This isn't even the worst part!  You see, page 25 of the grant documentation says:

“Requirements – Recipients shall comply with all current and future requirements of the project, including those issued through rulemaking and guidance specified and approved by the Secretary of HHS.”

Like it or not, Wisconsin is in a deal where the federal government holds all the cards!  HHS can change the rules however and whenever they so desire!

This is far from a "no strings" proposition!  This grant actually binds Wisconsin with ropes and chains! Wisconsin must give the feds whatever we make to use however they see fit and must comply with whatever rules the feds think up now and in the future.  Sound like a good deal, right?  Well, at least they're not asking for our firstborn children? (well, at least not now... maybe in the future)

If OCI would simply read the grant application, it's obvious that the federal government has high expectations about what Wisconsin will deliver and that they fully intend to leverage their investment in early innovator states like Wisconsin to bring Obamacare to every state across the country.  For a mere $38 million, Wisconsin is being asked to build the gallows on which the insurance industry, health care, and perhaps even our republic will be hanged.

Of course, OCI could simply listen to their boss, Governor Scott Walker.  On February 7, Walker, along with twenty other governors, wrote HHS Secretary Kathleen Sibelius demanding that HHS "provide states with complete flexibility on operating the exchange."  Governor Walker and the other governors conclude:

"We hope the Administration will accommodate our states' individual circumstances and needs, as we believe the PPACA in its current form threatens to destroy our budgets and perpetuate and magnify the most costly aspects of our health care system. While we hope for your endorsement, if you do not agree, we will move forward with our own efforts regardless and HHS should begin making plans to run exchanges under its own auspices."

Testify brother Walker!!! Way to speak truth to power!!!

On February 24, Kathleen Sibelius wrote back, essentially denying the flexibility the states demanded.  Michael Cannon of Cato Institute says that with this letter HHS delivered the beaurocratic equivalent of "drop dead!"

So, taking the governors at their word, you'd expect that Wisconsin would be having HHS make plans to run exchanges on it's own!  Certainly, Wisconsin wouldn't be implementing a state exchange given that very little flexibility is offered by PPACA and Secretary Sibelius wouldn't budge.  It just cannot be that Wisconsin is implementing software that will lead our entire nation into socialized healthcare... not for a mere $38 million... not with Governor Walker at the helm! 

Yet, Wisconsin IS building a health insurance exchange!  Something doesn't smell right in Wisconsin, and I don't think it's the cheese!

To be sure, Governor Walker will stand firmly behind his convictions.  He's held firm on so many other important issues.  Right??? Perhaps OCI should check with their boss more carefully as to how to proceed?


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