Ben Nelson provision could come back to haunt Obamacare

By Deena Winter | Nebraska Watchdog

LINCOLN, Neb. — Former U.S. Sen. Ben Nelson of Nebraksa may go down in history for casting the crucial 60th vote needed to pass Obamacare, but the concessions he got in exchange for that vote ultimately could obliterate the health care law.

Nelson is well known for negotiating for extra Medicaid money for Nebraska — in what was derided as the Cornhusker Kickback, which was later scuttled — but much less known for also insisting that states be allowed to run their own health care exchanges, where people shop around for health insurance.

The question of whether federal subsidies can be given to people who sign up for Obamacare through state-run exchanges is the subject of a lawsuit, King vs. Burwell, the U.S. Supreme Court will take up next year.

The plaintiffs argue the law bans the the subsidies in 36 states that use a federal enrollment portal. If they prevail, subsidies would only go to low- to middle-income people in the 14 states running their own exchanges.

If the challenge to the law is successful, some believe Obamacare would be obliterated. And who’s responsible for insisting the feds set up those two options for states? Nelson.

In 2010, Nelson told Politico and Fox News personality Greta Van Susteren giving states the option of running their own exchanges was a dealbreaker.

And even now, Nelson confirms he insisted on the state-run exchanges “rather than just a federal program without any state options.”

“I didn’t want it to be simply a federal exchange,” Nelson told Nebraska Watchdog on Thursday. “I wanted states to be able to do it themselves … They ought to have the option to run their own exchange if they choose to do that. I believe in government closest to the people.”

And contrary to some reports, Nelson said this was no secret at the time of the vote.

“People that I knew back here (in Washington) understood what my role was,” he said. “It was no secret at all.”

The state option was important, he said, as well as getting “appropriate abortion language” and eliminating the public option in the bill.

The importance of the state exchanges is being scrutinized closely, with the future of the law now in the hands of the Supreme Court.

MIT economics professor Jonathan Gruber, an Obamacare architect who has come under fire after videos surfaced of him saying voter stupidity was crucial to passage of the health care law, has changed his tune lately on the importance of the state exchanges.

In a 2012 speech in San Francisco, Gruber characterized the decision to add state exchanges as “a political compromise” — with Nelson — and said they were the centerpiece of the law.

In another video, Grouber said, “If you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits.” He said states would lose hundreds of millions of dollars in tax credits for residents by not setting up exchanges.

In Nebraska, 87 percent of those seeking an Obamacare plan qualify for subsidies, according to Blue Cross Blue Shield of Nebraska, the largest insurer on Nebraska’s exchange. If the plaintiffs prevail in the lawsuit, those people would not be able to get the tax credits, which make the insurance more affordable.

Nelson’s insistence on state exchanges was mentioned during oral arguments in the Court of Appeals. Judge Harry Edwards asked who cared who set up the exchanges, and the plaintiffs’ attorney, Michael Carvin, said, “They couldn’t get to 60 … Ben Nelson said, ‘We are not going to have a federally run exchange, we are going to implement basic principles of federalism and the states are going to run those exchanges or I don’t vote for it and it doesn’t get passed.’”

Accuracy in Media reported the plaintiffs say Nelson insisted federal subsidies only go through state-run exchanges, as an incentive for states to set up their own marketplaces.

But Nelson disputed that, saying, “There was nothing to do with subsidies to distinguish between federal and state-based exchanges.”

“I don’t know where that all came from. It was never discussed in my presence. Apparently someone has raised the point in litigation,” he said.

Asked what he thought of the possibility the state-exchange provision he pushed for could derail Obamacare, Nelson said, “That might be the case for 59 other senators. It just wasn’t debated, wasn’t decided, so we’ll just have to see what the court decides. If it is a legal problem, then it appears it was a drafting issue.”

Nelson declined to opine on what he thinks of Obamacare, due to his position now as chief executive of the National Association of Insurance Commissioners, which is neutral on the program.

“There are no do-overs,” anyway, Nelson said of the health care law.

“My job is make sure we take care of the states … Some day when I write a book, by then I will have made up my mind,” he said.

Nelson is a former Nebraska insurance commissioner and governor who retired from the Senate after two terms, some speculated in part due to the difficulty he faced getting re-elected after his Obamacare vote.

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