Paul Harrell on Answer-To-Us Radio program - Transcription of  Interview Feb 10, 2015  with Jacque Martin

on the Arkansas State Exchange and the upcoming Supreme Court case King vs. Burwell.


Jacque Martin is licensed in Arkansas to sell health and life insurance and has 35 years of experience working with corporate benefits. At end of interview is a link that documents some of this information.


Included in This Transcribed Interview:

·       * Arkansas Act 1500 establishes a State Exchange by July of 2015 unless repealed.

·       * Only 14 states now have a State Exchange.

·       * Private Option and State Exchange are two totally separate issues.

·      *  Discussion of upcoming Supreme Court Ruling.

·      * Individual Mandate and Employer Mandate are federal taxes - ruled so by the Sup. Ct.

·      * 35,000 people now get subsidies through Obamacare in Arkansas but 700,000 Arkansans are affected by the Individual Mandate and Employer Mandate - 21 times more people affected by tax mandates than get subsidies in Arkansas.  

·      * A State Exchange would be a job killer. No other surrounding state has a State Exchange.

·      * HB1152 of 2015 (page 12, line 33) funds the State Exchange.

·      * There is an effort in the legislature to repeal Act 1500 to terminate the State Exchange.

·      *  Repealing Act 1500 could result in smaller government, less taxes, more jobs, & better economy.

·      * A vote on repealing Act 1500 would prove if legislators support Obamacare and the Individual and Employer Mandate or not. It is not a gray issue but a black and white one.

·      * Obamacare is redistribution of wealth, plain and simple. Obamacare could collapse if the Sup. Ct rules in King Vs Burwell for the 36 states that have not set up State Exchanges.

·      * Link to Act 1500 of 2013 with Senator Jonathan Dismang as the Senate Sponsor. Act 1500 was originally HB1508 of 2013.

·      * Link to HB1152 of 2015 (page 12, line 33) that funds the State Exchange.


PAUL HARRELL:  Before we get into specific legislation, let's talk about what Arkansas has.  Does Arkansas have a State Exchange or does Arkansas have a federal exchange or is it a hybrid? Tell our listening audience what it is.


JACQUE MARTIN - Okay.  Currently Arkansas has what is called a partnership and that means Arkansas does the marketing end of it, and the federal government does the enrollment end of it.  So we are really on a Federal Exchange.  However, in 2013 the state legislature passed Act 1500 [HB1508] to establish a State Exchange, and that is what they have been marching toward.  What people need to understand about exchanges is how that is going to hit their pocketbook, and these exchanges may trigger whether or not you pay Employer Mandate or an Individual Mandate.  There have been only 14 states that have set up State Exchanges. Most of the states, 36 of them, do NOT have a State Exchange.  They are on the Federal Exchanges. And people want to know why that is.


What happened in the Obamacare or the Affordable Care Act, the section in 1311, establishes or directs the states to set up an exchange.  Well the Supreme Court shot that down in 2012 saying the federal government cannot force states to set up a State Exchange.  So now the state can have the option to do so or not do so. And until 2013, Arkansas was not going to set up a State Exchange. Then they passed the Private Option, but I want to make this point. The Private Option and the State Exchange are two entirely separate issues.  They are not one and the same.  The Private Option has to do with Medicaid Expansion.  The State Exchange has to do with those who are eligible for Obamacare because they make between 100 to 400% of the federal poverty level and therefore are eligible to go online to and enroll.


PAUL HARRELL - Absolutely not connected at all. That is an important piece because I have a feeling that one of the straw man arguments to excuse a lot of this is to say look, we can't get rid of the State Exchange because we may lose Private Option funding if we don't have one; you know if the Supreme Court rules - this is all based on the Supreme Court rulings consistent with lower courts so that is important.  We are going to be ready for that. We are going to debunk that.


So the bottom line is.  We are talking to Jacque Martin.  The Individual Mandate, first of all just talk about it.  What do you feel about it?  Fundamentally at its core, why is the Individual Mandate wrong.  I know the Supreme Court said it is constitutional.  Talk about that.


JACQUE MARTIN - It's not just the Individual Mandate; it's also the Employer Mandate.  The thing about the Mandates, the Supreme Court also ruled on the Mandates because that was one of the questions that they addressed in 2012 as well. And the Obama administration said it was really a tax even though in the bill it calls it a penalty, but it is a tax.  The issue about the Mandates is that the IRS chose to overreach their authority in allowing subsidies that help people pay their monthly premiums through these exchanges, through Federal Exchanges; the law is very explicit; it states simply that only subsidies will be allowed in State Exchanges and in the Federal Exchange subsidies will not be allowed.  So people say why not all fifty states get a State Exchange?  There is a very good reason why.  The reason why is that if states do not set up State Exchange they are not subject legally according to the law to the Individual Mandate, and they are not subject to the Employer Mandate.  This is a tax so they would not pay this tax.  If you choose to be on a plan that is not considered an essential health care benefit plan defined by DHHS in Washington, D. C., then any state that doesn't have an exchange, the employer or individual should not legally be assessed the penalty or the tax that they would be assessed this year because they don't have the essential health care benefit plan.


PAUL HARRELL - This is a great point so the Republican party of Arkansas - we are all about lower taxes; but I hear there is a bill to try to undo what we did already [in Act 1500].  And you know Governor Hutchinson just signed into law this tax cut. Who is not a fan of tax cuts?  We all want to do that. But let's talk about the amount of penalties that every day average Arkansans are going to have to pay because they are not insured or because they, like me, have a policy that's not approved by Obamacare.  We could do something to actually alleviate federal taxes at the state level. Isn't that incredible!


JACQUE MARTIN - That is incredible.  Yes, we can by repealing Act 1500.  This is what this does [repealing Act 1500 if the court rules in favor of the 36 states without state exchanges].  It creates more winners than losers. Right now the federal exchange for Arkansas is only servicing 35,000 Arkansans.  Most Arkansans get their insurance through their Employer and some get it through the private market and some choose not to carry insurance at all.  I have had people - I am licensed in this state to sell health care benefit insurance - and some are telling me "I hardly ever go to the doctor; I'll just pay the penalty."  What people need to understand is it is not a penalty; the Supreme Court has said it is a tax.  You are paying a federal tax. Okay, what this basically does - Cato Institute did a study for just Arkansas.  There are 4,004 companies in this state that would not have to pay an Employer Mandate and remember these are companies that have 50 or plus employees and they would have to pay it on every employee if they were found to be out  of compliance with the [Obamacare] essential health benefit plan.


Now in March there is a Supreme Court case being heard - it's King Vs Burwell - where the Court will determine if the IRS broke the law by overreaching their authority and paying subsidies through the federal exchanges for the 36 states that chose not to set up a state exchange. The Obama administration knows that if the Courts rule in favor of the plaintiffs in this case then Obamacare will die on the vine since there won't be dollars flowing from the mandate taxes to run back through the exchanges. This is key and Obamacare will collapse in upon itself.


PAUL HARRELL - Wow! So 4,000 companies that have over 50 employees would not have to pay this tax if Arkansas were to act and say we don't want a State Exchange; we want a Federal Exchange.  That's an incredible amount of people.  I can't for the life of me; I can't imagine why this has not already been done. Meaning why this state exchange has not already been repealed.]  


JACQUE MARTIN - You have four main cases.  King vs. Burwell to be heard March 4 has to do with questions about the IRS overreaching their authority in running subsidies through the federal exchanges where no state exchange is set up [Only 14 states have a state exchange] Well, the Cato exchange  extrapolated the number out, and we are looking at over 760,000 Arkansans that should not be assessed this federal tax under Obamacare, the Individual Mandate or the Employer Mandate (remember the Employer Mandate ranges from $2,000 to $3,000 per employee.  Now on the Individual Mandate it is going to continue to increase until it is over $2,000 per Individual who refuses to have an essential health care benefit plan. I don't want to wade off into a lot of weeds, but the bottom line for me is the discussion will last three weeks in the legislature (it's been about two) to continue the Private Option because we have 215,000 low income Arkansans that need health careWe have working people and Employers in this state that need relief also.  If you look at the 35,000 that are currently on which is Arkansas's federal exchange and compare it to those Arkansans that would benefit from NOT having a State Exchange, the winners in that equation is 21 times more than the 35,000 that are currently being served.


PAUL HARRELL.  Those are interesting numbers.  You have 35,000 served on the exchange; you have 200,000 people on the Private Option but 700,000 affected by the Individual Mandate and Employer Mandate.


JACQUE MARTIN - That's exactly right and you know I am all for - when you are in government, you have to represent all people.  Okay, I'm sitting here; I'm a working stiff.  And I'm thinking when is it my turn?  So I am looking at this,  and I'm thinking my health care premium has increased 415% because we get insurance through my husband's Employer. They have to be in compliance with the essential healthcare benefit plan so in two years' time our monthly premium has gone up 415%.  Our monthly budget is cut WAY back.  Why not allow me - I don't need maternity care; I don't need pediatric care;  I don't need contraception;  I mean I'm sixty years old.  Let me go on to the Private market and purchase health care that I can afford and that I need.


PAUL HARRELL. - Let's say Arkansas wants the State Exchange.  We want to do it. We want to participate in Obamacare even more which is what I think is going to happen if you want me to be perfectly honest.  What happens when the Employer Mandate kicks in, are there going to be a lot of Employers that just dump their coverage and put them into the government insurance?


JACQUE MARTIN - Yes, because the Employer tax that they have to pay on their group benefit plans - there are a bunch of taxes involved in Obamacare; it's going to increase until 2020 and beyond probably.  It is going to come to a point where an Employer can no longer afford to provide group health care benefit plans to their employees so you throw them off into the exchange. You know what that does for a state; it becomes a burden for the state; if they have not fiscally budgeted for this new burden for new enrollees into a State Exchange it is going to break the bank.  Not only that it's a job killer.  If you look at the states around Arkansas, not a one of them have set up a State Exchange, not one.


Now in March there is a Supreme Court case being heard - it's King Vs Burwell - where the Court will determine if the IRS broke the law by overreaching their authority and paying subsidies through the federal exchanges for the 36 states that chose not to set up a state exchange. The Obama administration knows that if the Courts rule in favor of the plaintiffs in this case then Obamacare will die on the vine since there won't be dollars flowing from the mandate taxes to run back through the exchanges. This is key and Obamacare will collapse in upon itself.


JACQUE MARTIN  - Something you must understand -  If you pay the mandate, if the employer pays the mandate on all the employees, that money goes to support the subsidies and run the subsidies through the exchange.


PAUL HARRELL - It is the redistribution of wealth, plain and simple.  It doesn't get any simpler for the redistribution of wealth than that.




PAUL HARRELL - Okay this is all good information.  We are talking with Jacque Martin;  I heard her today; I knew I had to have her on the program because we've been talking, folks, about the State Exchange and Obamacare and how this is incredible to me.  And I've already heard that people in position of power here in Little Rock, Republicans, want nothing to do with getting rid of the State Exchange. I've already heard it and I don't understand.  It's a way to cut taxes for Arkansans; it's a way to promote jobs because like you said every other state around us doesn't have it. So what's going to happen?  Who would want to move to Arkansas to start a business?


JACQUE MARTIN - Exactly.  That's why it is a job killer. Because there is not going to be an employer who will want to come to Arkansas if they set up a state exchange and thus make that employer subject to the employer mandate if they have more than 50 employees.  So I sit here going, this is a game changer, Republicans, if you're pro job, if you're pro less taxes, and if you are pro helping working middle class people then you need to be FOR getting rid of the State Exchange.


PAUL HARRELL - Act 1500 - that was the bill that created the State Exchange [effective this July] , but we still don't have one yet. It just put us on a path to eventually have one. 


JACQUE MARTIN. That's right.


PAUL HARRELL.  Okay, making sure of that.  So we have this one bill HB1152 page 12, line 33 that funds the State Exchange.  That is now being held up in committee I am told for the time being.  I am also told that state Representative freshman Mary Bentley has a bill she hopes to have the number and it filed this time next week to try to repeal the State Exchange altogether. And we folks have got to dare Republicans to vote against this bill.  It has nothing to do with the Private Option and is a way for legislators to get back into political  favor with the base because this is the way to save us from the Employer Mandate and the Individual Mandate.


JACQUE MARTIN - This is really a conservative ideology - it shrinks government because if you're going to create a State Exchange, you are growing government: you've got to hire more government employees to maintain that State Exchange. Then you are filtering all kinds of tax dollars to keep it going and it is going to continue to grow and grow. Mary's bill would also make sure that we get employers in this state to create jobs. This state desperately needs jobs;  we do not need a job killer especially if all the other states don't create a State Exchange.  Now I've had people ask me what if the Supreme Court rules that it's okay for the IRS to run those federal subsidies. Okay, fine, at that pointwe would still be on the federal exchange with no more consequences than we have now.


JACQUE MARTIN - The lower courts have already ruled with the plaintiffs on this. And I expect the Supreme Court will rule like the lower courts. 


PAUL HARRELL - And they are clear, but I'm just saying I thought the Individual Mandate was going to be unconstitutional.  I am just preparing for the worst and I hope for the best. My point is if there is a chance that Arkansas could do X and it result in tax relief, more jobs; it's a no brainer; do they really mean what they campaigned on or not.  In my opinion, Jacque, I don't see how anyone can say that they are fighting Obamacare or are against Obamacare if they don't vote to repeal this Act setting up the state exchange.   This is not a gray issue;  you cannot make this a gray issue.  This is black and white.  You either support the Individual and Employer Mandate or you don't.


JACQUE MARTIN - It's in the Republican platform.  If you ran on the Republican platform, you ran for smaller government, less taxes, more jobs, better economy for Arkansas.  This is what  all senators and all representatives in the state of Arkansas ran on.  


PAUL HARRELL - Great point.  It's in the Republican platform. I'm going to look up that Republican platform as well.  I do appreciate Jacque Martin very much, very valuable information and very reasoned way to lay it out for us to understand it easily.   END


The following article documents some of the information in above transcribed interview and gives further explanations on some points.

1. Forbes article "Halbig v. Burwell Would Free More than 57 Million Americans from the ACA's Individual & Employer Mandates" - the first paragraph describes most of the background information for this letter.  The lower court decisions sort of morphed into one decision that the Court will hear, "King vs. Burwell."


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Transcribed by Debbie Pelley for Women Action Group

Posted February 25, 2015