An email from reader G.W.B. (no, not that one):

One question I have about the idea of buying insurance across state lines: doesn’t that actually violate federalism (forcing it, that is), and invite further national meddling in the market?
Wouldn’t it be better to leave insurance totally as state markets? Let the states regulate as they see fit. As long as you’re not doing “interstate commerce” we have a stronger position for pushing the national government out of the market. If someone really wants to change the availability for insurance (mandates, regulation, etc.), they can fight the regulation politically inside their state, or they can move.
It has just seemed an odd argument for conservatives who normally argue for federalism.

State-by-state regulation acts as the type of barrier to interstate commerce that the Constitution gives Congress the power to tear down. The Supreme Court so ruled, and Congress decided to let the states occupy the field. Congress has the power to revisit that decision.

Resisting regulation state-by-state, particularly regulation of the form “health insurance governed by this state’s regulations must cover procedures X, Y, and Z,” has not been particularly successful. Even if the regulation reduces the general welfare, the providers of X, Y, and Z have a stronger interest in getting the regulation than the general public has in blocking it. I suspect that federal regulation would work the same way. That’s one reason I’m less enthusiastic about “association health plans”–an attempt to let small businesses band together across state lines to offer insurance under federal rather than state law–than a lot of conservatives. A choice-of-law regime, in which state regulatory schemes compete with one another, has more promise.

Recently, though, I have been wondering if another path forward might be opening up. If some state wants to enact a law that says that any insurance policy that passes regulatory muster in one of the other states is fine with it, too, it has the power to do so. (It could also take many steps that fall short of this: Say, allow the insurance commissioner of the state to exclude ten states from the list of states whose insurers are allowed to compete.) For roughly the same reasons that it has not been possible to resist regulation in each state, no state has ever tried to do this. But free interstate commerce in insurance has never been a cause that interests many people. Over the last year and a half, conservatives nationwide have gotten more knowledgeable about the interstate-sale issue and committed to liberalizing the law. So maybe some state could try this on its own.