March 3, 2014

Chamber just says no to nullification

With ethics done, nullification moves to the top of the Senate’s agenda this week — which means it’s time for me to start paying more attention to the House.

With ethics done, nullification moves to the top of the Senate’s agenda this week — which means it’s time for me to start paying more attention to the House.

I’ve tried to ignore the nullification debate because it such a colossal waste of time and energy.

At best, any attempt by the Legislature to disrupt Obamacare — other than by refusing to expand Medicaid — would accomplish nothing more than forcing S.C. taxpayers to foot the bill for a federal lawsuit that our state would lose.

At worst, I’m told by people who understand this area of state law far better than I do, it could force S.C. taxpayers to foot a much, much larger bill for changes we might eventually have to make to state government employees’ health insurance. Well, that, and prevent the Senate from dealing with any more important issues this year, beyond the budget.

But as I understand it, one of the big arguments against Obamacare is that it will wreck our economy by hurting businesses. So I thought it was interesting to see that the S.C. Chamber of Commerce, never a fan of Obamacare, making it clear last week that it is likewise no fan of nullification. Or of the proposal Sen. Tom Davis put out last week that he promises will avoid the constitutional problems of nullification while still striking a blow at Obamacare.

Here’s what the Chamber had to say in its weekly Competitiveness Update, distributed on Friday:


An amendment proposed this week by Senator Tom Davis (Beaufort) to H.3101, legislation aimed at nullifying the federal health care law, would place unfair burdens on employers related to compliance with the Patient Protection and Affordable Care Act (PPACA). Additionally, the Davis amendment would negatively impact state agencies in performing their mission and regular duties. Another section on grant transparency would have negative impacts on research, innovation and access to health care. Overall, the nullification legislation’s broad language provides an unstable regulatory environment, which would be burdensome to South Carolina companies and economic development related to companies considering locating in the state. Stability is a key component for businesses in the regulatory environment. Health care costs, rules and regulations are no different.

Several groups have publicly stated opposition to continuing the unconstitutional fight for nullification, including the South Carolina Chamber of Commerce, the Business and Industry Political Education Committee and the South Carolina Manufacturers Alliance. A recent study by the Americans for Limited Government Foundation lists reasons why states must now focus on ways to reduce costs in complying with what is now law. First, many agree that nullification is unconstitutional. Additionally, the report concludes, “Within this context, the negative consequences that even Obamacare might inflict will likely be dwarfed over time by those flowing from passage of House Bill 3101, as health insurance companies withdraw from the state for fear of running afoul of its ambiguous but potentially ominous criminal penalties. For if passed in its present form, any company that complies with the health insurance plan requirements of Obamacare (as existent federal law dictates) runs the risk of being prosecuted under South Carolina law… At the least, their capacity to operate efficiently within the state’s borders and provide much needed services will be significantly complicated and impaired.”

In 2012, the South Carolina Chamber opposed the PPACA and does still have strong reservations about the burdens placed on businesses in complying and what impact the law will have on health care costs. The South Carolina Chamber of Commerce joined 14 other state chambers and business organizations in filing an amicus brief in the U.S. Supreme Court challenging the PPACA. The amicus brief requested that the constitutionality of the federal health care law passed in 2010 be decided without delay in order to relieve uncertainties now facing employers and their employees. The case was defeated.

Now that the PPACA is law, it is important that states move forward and focus on complying and reducing costs. The PPACA has been challenged, ruled on and found constitutional. It is now law. South Carolina now must move forward and work to provide health care for citizens and reduce costs. Gridlock will only further exacerbate the uncertainties businesses face. Focusing on improvements to the law to reduce costs for businesses and employees should be the primary goal of public policy officials.

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