individual mandate
Obamacare as “Play or Pay”
I have a new post up at National Review Online on how today's Supreme Court decision raises some interesting questions about how Obamacare will operate in the real world:
The Congressional Budget Office (CBO) and others have suggested that the presumed mandatory obligation to buy health insurance would be a very powerful motivator for those who today choose to remain uninsured to purchase coverage, even though the “penalty” they must pay is generally far less than the premiums for even bare-bones health insurance. In other words, the CBO assumes these people will go along with the program because everyone else is going along with it and, well, it’s the “right thing to do.”
This was always a dubious assumption, as it presumes people will act against their own self interests. But it would seem even less plausible now because the Supreme Court, in its language today, has made it clear that the mandate cannot be viewed as a mandate at all; it’s just an optional tax that citizens can pay in lieu of securing health insurance.
You can read the rest of the article here.
posted by James C. Capretta | 7:28 pm
Tags: individual mandate
File As: Health Care
All the President’s Mandate Positions
I have a new column up at National Review Online on Obama’s history of flip-flops on the individual mandate:
Without the mandate, the Obama plan would not be considered a “universal coverage” plan in Democratic circles, as analysts, including those at the Congressional Budget Office, would expect large numbers of Americans to decline to sign up for coverage in a voluntary system. Party elites and activists would regard this as a major, perhaps even fatal, flaw. Nothing in the Democratic catechism is more sacred than the goal of “universal coverage” in health care.
So Senator Obama was taking a risk in not toeing the party line. But it was a calculated risk. He knew from polling data that, despite its popularity among party elites and left-leaning health-care analysts, the individual mandate was far less popular among Democratic primary voters. Here was a policy difference with Senator Clinton that he could exploit to his advantage in the primaries.
You can read the rest of the article here.
posted by James C. Capretta | 3:00 pm
Tags: individual mandate
File As: Health Care
What Now for the Supreme Court?
Over at National Review Online, I’m one of several respondents to a symposium asking the question, “Now that the oral arguments are over: What should SCOTUS do?” Here’s the beginning of my short response:
Yes, Obamacare is “unprecedented” — an unprecedented federal power grab. If allowed to stand, the law would steadily shift immense control over the entire health sector from states, employers, private companies, and individuals to federal bureaucrats. And once the big changes scheduled for implementation in 2014 are set in motion, they will be very difficult to reverse later.
The rest of the response is here.
posted by James C. Capretta | 3:26 pm
Tags: individual mandate, Supreme Court
File As: Health Care
It’s Not Just About the Individual Mandate
I have a new Weekly Standard article on the need not to focus exclusively on the individual mandate in undoing Obamacare:
Obamacare’s individual mandate — requiring that all Americans purchase government-approved health insurance beginning in 2014 — has always been the law’s most vulnerable provision. It is incredibly unpopular, and not just among conservatives. Polls consistently show that a large majority of the electorate opposes it, including a good portion of registered Democrats....
[However], even if the Supreme Court were to strike down the mandate, much of the rest of the law would almost certainly remain in effect. That’s unacceptable. Obamacare without the mandate is nearly as bad as Obamacare with it.
In the end, the fate of Obamacare will almost certainly be decided in the political and legislative arena, not the courts, and the 2012 election is likely to be the decisive battle in that regard. Keeping this in mind, Republicans and conservatives should be doing all they can to make the 2012 election another referendum on the damage Obamacare will do to the American economy and health system....
You can read the whole article here.
posted by James C. Capretta | 2:04 pm
Tags: repeal, individual mandate, Supreme Court
File As: Health Care
Reforming Health Care with “Defined Contributions”
Over at Kaiser Health News, AEI’s Tom Miller and I have an article describing how Congress enact a health-reform program that deals with the central issue of cost control while also achieving universal coverage without the need for a mandate:
Pro-competition, pro-consumer-choice advocates should press for reforms that would begin to convert existing, federally subsidized arrangements from open-ended benefit guarantees into "defined contribution" programs. The comprehensive and strategic approach we propose would apply defined contribution financing by taxpayers to all three major insurance coverage platforms — Medicare, Medicaid and private health insurance....
The prescription drug benefit, added to Medicare in 2003, provides one partial model for how to move toward a defined contribution approach. The government's payment for a beneficiary's Medicare drug coverage is fixed through competitive bidding each year, and it remains the same regardless of which plan the beneficiary selects. Seniors selecting more expensive plans than the average bid must pay the additional premium out of their own pockets. Those selecting less expensive plans get to keep the savings. Scores of insurers entered the program and competed aggressively with each other. The result is that costs were driven down, and federal spending came in 40 percent below initial expectations....
Read the full article here.
posted by James C. Capretta | 10:30 am
Tags: defined contributions, Medicare, individual mandate
File As: Health Care
Now It’s Unstable Legally as Well as Politically
The decision on the individual mandate handed down today by U.S. District Judge Henry Hudson in the Eastern District of Virginia makes it clear that Obamacare is on extremely shaky legal ground. That’s fitting, because it’s been on shaky political ground for well over a year now. Today’s decision — possibly joined by others in the weeks ahead — is going to strengthen the already strong perception that this law was ill-advised from the get-go and needs to be repealed to make way for a more sensible, consensus-driven program.
Specifically, the judge’s ruling today found that the new law’s requirement that all Americans must purchase government-approved health insurance or face a fine was not a permissible use of lawmaking authority granted to Congress under the Constitution. In other words, Congress doesn’t have unlimited authority to do anything it wants. Its powers are carefully enumerated. And among them is not the power to force Americans to buy something they would otherwise forgo.
Without the individual mandate, the whole Obamacare edifice crumbles. The judge did not rule that the entire law must be invalidated. But if the individual mandate goes, the insurance regulations — and most especially the requirement that insurers must take all comers without regard to their health status — will never work. Patients could simply wait to enroll in health coverage until they needed some kind of expensive treatment or procedure, and thus pocket the premiums they would have paid when they were not in need of much medical attention.
Still, it’s been clear for some time that repeal advocates should never bank on courts bailing the country out of Obamacare. This issue is far too important to leave to such an unpredictable process. Moreover, even if the mandate and related provisions are gutted by the courts, that would still leave many horribly damaging aspects of Obamacare in place, such as the massive entitlement expansions and the heavy reliance on government-imposed price controls.
Today was a good day. But it’s really just a small skirmish in a much wider war. By all means, every legal remedy should be pursued. But Congress has a responsibility to undo this mess as well, regardless of how the court cases turn out.
(I also discussed the decision in a brief interview this afternoon with Megan Hughes of Bloomberg, available here on YouTube.)
posted by James C. Capretta | 4:24 pm
Tags: individual mandate, constitutionality
