As Congress and the White House continue to wrangle about the precise structure of the proposed health care overhaul, one question remains unanswered: will the final version of the reform include an individual mandate, a requirement that every citizen carry health care to prevent medical bankruptcies that drive up the overall cost of coverage?

 

The individual mandate provision has been the subject of a fair amount of debate in Washington, but ultimately hasn’t received an overwhelming amount of attention in the media.  But it has been included in several of the competing plans floating through Congress right now, including the initial legislation put forth by Senator Ted Kennedy of Massachusetts.

 

In fact, Massachusetts already has an individual mandate in place.  Essentially, the program requires that all citizens of the Commonwealth carry some form of minimal health coverage, either through a private insurer or through the state’s health insurance bureau.  Those who do not are subject to tax penalties equal to 50% of the least expensive state plan for which they qualify.

 

However, legislators sought to avoid imposing fines on families and individuals who don’t carry health insurance because they simply can afford it.  Accordingly, not all citizens are subject to the mandate.  Children do not acquire penalties, nor do families or individuals who earn less than 150% of the federal poverty level.  Those who are faced with tax penalties for not having health insurance pay anywhere from $210 up to $912 per year for the wealthiest in the state.

 

There are arguments to be made on both sides of the issue. 

 

Opponents argue that people under the mandate would be deprived of the option of deciding whether or not to carry health insurance, and penalized if they decide not to.

 

But backers counter that the plan isn’t unlike a requirement placed on drivers to carry accident insurance.

 

The burden of the uninsured is one of the single biggest drains on the health care system, and one of the primary driving factors in the rising cost of healthcare (which has skyrocketed at more than twice the rate of inflation over the last ten years).  When an uninsured individual gets injured or becomes sick, the treating hospital bills him or her directly.  Without coverage from an insurance provider, the individual is forced to pay the bills out-of-pocket, forcing many to declare bankruptcy.  Unable to collect, the hospital then eats the cost of the treatment, and raises the costs on everyone else to compensate for the loss.

 

Medical bankruptcy is probably more common than you think.  Every 30 seconds, someone in this country files for medical bankruptcy. Since 2000, 5 million families in this country have filed for bankruptcy in the aftermath of serious medical problems, many of whom assumed that they'd be healthy enough to avoid needing to see a doctor. More than one out of every four homes that fall into foreclosure are brought about by an inability to pay for medical bills.  It is the single most common cause of home foreclosure.

 

And those numbers have reverberations throughout the economy.  When homes go into foreclosure, banks lose money on the loans they provided to the homebuyer.  We all saw what happened late last year when banks ended up unable to collect on loan payouts.

 

The individual mandate would require that everyone carry some kind of minimal, catastrophic insurance aimed at preventing these kinds of unpayable medical bills when the unthinkable happens, from a split-second automobile accident to a previously undetected cancer.

 

What do you think of the individual mandate?  Use the comment section to voice your opinion.

But this equivalence has never worked for me:


"But backers counter that the plan isn’t unlike a requirement placed on drivers to carry accident insurance. "


he requirement that is on drivers to carry auto insurance only enforces them to carry property liability and property damage coverage. They CAN opt out of everything that benefits them. Therefore even in states where insurance is mandatory, you can still get in a horrible accident and have your vehicle destroyed and get no money. The health care analogy doesn't really work.

And let's be honest about why people oppose mandates too. Yeah I'm sure part of it is, "I shouldn't have to buy insurance if I don't want," but the reason people hate it here so much is because people here hate insurance companies so much. The Massachusetts model doesn't encourage competition, and the public option in the Massachusetts model isn't doing much in the way of keeping costs down. If there was a competitive public option that would force private insurers to offer competitively priced effective plans that people could "Mandate" into we wouldn't see the same failures we've seen in MA.

The other piece of this is if you want to insure everyone who "wants" insurance, you're going to NEED some of the money from people who don't want it. That's just the way it works. If only people who TRULY needed insurance got insurance, it wouldn't work. There wouldn't be enough money in it to pay for health care because the only people paying in would be immediately cashing out. The bigger the client / risk pool, the more affordable it is.

If nothing else--if we get an adequate public option--people who don't choose a plan are "taxed" into paying into that. It's not as if those same people won't expect care if they're injured.

TooFolkGR, compare what auto insurance is aiming to protect: the not-at-fault party from getting hit and not being able to collect compensation. In the health care realm, the party taking the hit is the people at large. When uninsured person X gets injured and can't pay his bill, you and I pay higher premiums to offset his nonpayment. It's a public protection issue.

As for your other point, I half agree with you. But even under a public option, subscribers will pay a premium (it will just be much lower than a private offering).

about mandates, but I understand the arguments for and against.

What nobody has mentioned is that fact that eliminating the ability of insurance companies to deny you for a pre-existing condition almost necessitates mandates of some kind. Think about it. If I can be diagnosed with a very expensive condition, and THEN go and get insured, and pay nothing more than premiums and get covered for something that costs multiple times what I'm paying, then what you've got isn't really insurance. Insurance is supposed to imply risk on both sides -- the insurer takes the risk -- not the certainty -- that you might one day need more in care than your premiums cover; and the individual takes the financial risk that he pays in more in premiums than he actually uses. That balancing of risks on both sides is what makes insurance work financially. If you remove that risk on the part of the insured, and make it a sure thing that, as soon as he's diagnosed with, for example, some form of treatable cancer, he can start paying premiums then and get paid out much more than he'll ever put in, then why would any sane person take the financial risk that insureds take now? Why wouldn't many people simply wait until it looks like they are going to have a major medical issue and then get "insured"? Why would anybody pay premiums if they expect that they'll get back in covered care less than what they pay in premiums (which is what has to happen for the insurance model to work)?

If people aren't mandated to get health insurance coverage, then they will not if they perceive that it is not a good deal for them.

The problem is that it is young and healthy people who will make this calculation and take the risk of remaining uninsured.

If we combine a system without a mandate with a system that allows people to enroll for coverage when they want to without regard for pre-existing conditions, then young, healthy people have very little reason to participate.

Without the young and healthy, the average premium for the people in the system would be higher, causing even more people to decide to opt out.

In theoretical models, this is an unsustainable system.

In practice, even without a mandate, if the price seems reasonable, we may get enough young and healthy people in the system to make it work. Some health-care economists seem to think so. We could try it without, and see what enrollment patterns developed.

Of course, if we had single-payer, this wouldn't even be an issue, but I'm not holding out for that.

The con is that we largely lock in the for profit access to health care system.

For profit delivery and technology build outs for health care are great things, but not access.

A mandate to me seems like making the pool artificially large, as if simple unwillingness to get insurance is the problem. That puts things on us, and that's not cool.

Almost nobody is avoiding insurance because they want to make different choices. There are a few, religious, liberatrian, etc..

The majority of people would gladly pay, a nice fraction of them can pay too.

The problem is the insurers excluding anybody that isn't profitable for them.

The really need to get everyone involved and rewrite this thing. As it is...it's terrible and won't reduce or control costs.

Gregg's Health Insurance News Website Link

The argument cited in the post comparing mandated health insurance with mandated auto insurance is ridiculous. People buy a car knowing they're on the hook for insurance. If they can't afford it, they don't buy the car; they choose to walk or take the bus, or they buy a car that will cost less in insurance. I can't choose to not have a body. And I can't trade it in for one that costs less to run. There is no way that people aren't going to get screwed. I can practically guarantee that the formulas for mandates for who's allowed to buy into the public option will leave millions of people out in the cold.

But at that point you're not talking about an insurance mandate... at least not in the sense we covered it in last year... you're talking about a catastrophic coverage mandate. Meaning insurance just cheap enough that it covers the "Good Samaritan Type Emergency Room Coverage" people already have but don't pay for. That's my take anyway.

there is not a strong non-profit public option. You cannot force people to buy something they simply cannot afford, so you have to make sure there is something in the plans they can afford and something that will drive prices down. Without a PO, a health care bill is nothing but a giveaway to the insurance companies.

2) SEC. 401. TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE, should be amended to apply this tax to the persons premiums, and, when paid, should fully cover the person for the next calendar year. Better yet, just take out our premiums in our payroll taxes for the public option.

This is completely outrageous and unacceptable, IMHO. Why would we tax the working poor after the fact as a penalty, rather than before the fact to make sure they are covered? It is taxation without remuneration or benefit.. In a way it is fining you for simply simply being alive. What this will produce are cheap plans by fly-by-night insurers that meet the legal requirement, but actually pay no benefits.

"From HR3200
SEC. 401. TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE.
SEC. 59B. TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE.
`(a) Tax Imposed- In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of--
`(1) the taxpayer's modified adjusted gross income for the taxable year, over
`(2) the amount of gross income specified in section 6012(a)(1) with respect to the taxpayer. "


Graham Green Website Link

had it right when he was running, namely, no individual mandate.