STATEHOUSE (Feb. 17, 2010) - Members of the Senate Judiciary Committee voted 6-4 today in favor of a resolution urging the Indiana Attorney General to explore all legal options available to the state regarding the potential passage of the federal health-care reform bill.

Senate Concurrent Resolution 39, authored by State Sen. Scott Schneider (R-Indianapolis), is aimed at protecting the taxpayers of Indiana by urging the Attorney General Greg Zoeller to explore all options available to Indiana if the federal health-care reform is passed.

In December, Senator Richard Lugar, as well as other state elected officials, asked Zoeller to render an opinion on the impact of federal health-care reform on the state of Indiana. The attorney general’s report points out some items that are of serious concern to the taxpayers of Indiana, including the section commonly called the Nebraska compromise.  In order to get the Nebraska senator to vote in favor of the bill, a deal was made to permanently exempt Nebraska from paying Medicaid costs that Indiana and all other states must pay under the proposal.

“Taxpayers from Indiana and the other 48 states are being asked to subsidize Medicaid cost for Nebraska,” Schneider said. “This raises a very serious constitutional issue and I believe our state should be prepared and explore all options to protect Hoosier taxpayers. This resolution is an attempt to protect Hoosiers from a huge tax increase and federal mandates.”
 
The attorney general’s report also concluded that individual mandate raises serious constitutional questions. “By directly forcing individual economic action through the ‘individual mandate,’ the bill would exceed even the most expansive understanding of the Commerce Clause,” the report concluded. “In addition, the bill would accord some states, most notably Nebraska, special treatment without justification and would even seem to prefer the commerce of some states to others.”

Schneider said the attorney general’s report listed several other provisions that could face a court challenge:

• Treating states differently without relation to naturally occurring conditions by providing preferential tax treatment of non-profit insurance companies;
• Interfering with internal state operations by mandating states create temporary Medicare reinsurance programs  and by setting the level of benefits that states may provide its employees; and
• Binding future state legislative action by creating an unrepealable Independent Medicare Advisory Board.

Analysis for the report “leads to the conclusion that the Reid Bill is about subsidizing the costs of healthcare, not reducing them” and could have a tremendous fiscal impact on Indiana. According to the report, the legislation would expand the Medicaid program by approximately 500,000 recipients, increase the state’s Medicaid costs by $2.4 billion over ten years and could have a negative impact on the state’s pharmaceutical and medical device industries that employed a combined 35,500 Hoosiers in 2007.

SCR 39 now moves to the full Senate for further consideration. The complete report issued by the attorney general’s office is available at www.attorneygeneral.in.gov.