I like the idea of keeping the federal government out of it. The framework for the states already exists in the form of Medicare. I’m not a fan, but I presume my home state of Florida would opt out.

As to your point of people moving based on state laws, we’re seeing that now with massive migration occurring. Personally, I’ve refused to live or work in a state with an income tax since I got my first real job 30 years ago. I’ve lived in NH, TX, and FL.