Why President Obama Should Jettison the Individual Mandate

Two key elements of the Patient Protection and Affordable Care Act are the requirement that health insurance carriers accept all applicants (what’s called guarantee issue) matched by a requirement that individuals obtain health care coverage or face a penalty (referred to as an individual mandate). The PPACA was not the first bill take this approach to move toward more universal coverage. In response to then President Bill Clinton’s health care reform proposal, 19 Republican Senators joined by two Democrats, put forward the Health Equity and Access Reform Today Act of 1993. Central to the proposed legislation was an individual mandate.

That was then.

Now Republicans cite the individual mandate as a key flaw of the Patient Protection and Affordable Care Act. Recently a Federal Judge in Florida declared the individual mandate contained in the the PPACA was unconstitutional and, as a result, the law itself was unconstitutional. Eventually the Supreme Court will rule on whether the individual mandate in particular and the health care reform law in general can stand. Their decision will hinge on how they interpret the Commerce Clause of the US Constitution.

This is not a clear-cut, black-or-white issue and the Court could go either way on the issue. The Commerce Clause has evolved considerably since the Constitution was adopted. That legal scholars and judges reach different conclusions when applying it is not surprising. Consider: to date, two Federal District Court Judges have rejected claims the individual mandate exceeds Congress’ powers under the Commerce Clause while two others determined it does. For those interested, NPR’s The Diane Rehm Show aired one of the most informative, clear and helpful discussions of the legal issues surrounding the PPACA I’ve come across. (The entire 51 minutes segment is well worth a listen, however, much of the key legal explanation takes place between the 8 minute and 28 minute marks).

Unless the Supreme Court accelerates the process, they will probably hear appeals of lower court decisions after they convene their next term in October of this year, with a decision likely to be published in the Spring of 2012. Take note of that timing – as we’ll see it matters.

The question is, should President Barack Obama even let the individual mandate reach the Supreme Court? An argument can be made that the President and his signature domestic legislative accomplishment would be better off abandoning the individual mandate as it exists and replacing it with a different approach. Here’s my version of the argument:

Requiring carriers to accept all applicants without a provision requiring consumers to obtain coverage is a recipe for disaster. The average premium for individual coverage (insurance purchased without a contribution from an employer) in New York and New Jersey are more than twice the average premium for similar coverage in California in large part because New York and New Jersey law requires guarantee issue, but lack an individual mandate. . Consumers there take the economically smart course of waiting until they are sick or have an accident before obtaining coverage. To cover the inevitable losses, carriers set high premiums.

This is why Democrats included an individual mandate in the PPACA. Unfortunately, it isn’t much of a mandate. Individuals who fail to obtain coverage, unless excused from the requirement on religious grounds, will be required to pay a penalty. In 2014 this fine is the greater of $95 or 1% of income; by 2016 $695 or 2.5% of income, whichever is greater. Given that the CBO estimates that individual premiums for the lowest level of benefits available to most Americans under the PPACA will average between $4,500 and $5,000 (that’s for the Bronze level of benefits for those keeping track) the economic calculation is pretty straightforward. $4,500 is 2.5% of $180,000. So anyone with a taxable income of $180,000 is arguably better off going without coverage until they need it – give or take risk tolerance.

The PPACA’s individual mandate may be lightweight, but the political cost has been heavy Jettisoning the individual mandate as it currently exists would neuter one of the Republicans core attacks against President Obama and the PPACA – that this provision exemplifies an abusive expansion of the federal government at the expense of individual liberty. (That the IRS will need to hire additional staff to enforce the penalties only makes the situation politically worse for the Administration). Democrats may describe the individual mandate as a call for individual responsibility, but they’re losing the debate – as the election results of 2010 underscores.

Replacing the PPACA’s individual mandate with something different, something that more directly speaks to personal responsibility – without involving the IRS – and that is more effective in accomplishing the goal of the individual mandate, is a winning public policy and political strategy.

Fortunately for the Administration, there are viable alternatives. For example, a year ago I suggested allowing carriers to exclude coverage for pre-existing health conditions and impose a premium surcharge on individuals who go without medical coverage for a specified period of time. Others are suggesting creating a limited open enrollment period during which uninsured individuals can apply for coverage on a guaranteed issue basis.

There’s another very practical reason for the President to seek a different approach to getting individuals to obtain coverage before they are sick or injured. Whether the Supreme Court will rule the PPACA’s individual mandate as unconstitutional is a great unknown. Legal decisions are hard to predict and given the makeup of the current Court, their decision on this matter will likely be close.

And the result could be devastating to the Administration. If the Court were to strike down the individual mandate in the Spring of 2012 the Administration would be forced to find a replacement in the heat of a presidential election campaign. How likely are Republicans to cooperate with the White House just weeks before their nominating convention? Worse, the Supreme Court could find that since the individual mandate is unconstitutional the entire health care reform law is nullified.

Imagine the chaos. Would 26 year olds insured under their parents’ policies suddenly be dropped? Would seniors be required to reimburse the government for checks they’ve received to close the donut hole in their Medicare prescription coverage? This is not what the President wants dominating the news during his re-election campaign.

The political and societal risk can be minimized to nearly zero simply by eliminating the element of the PPACA most open to challenge: the individual mandate. After all, the Supreme Court can’t declare unconstitutional a provision already removed from the law.

Republicans say they want to do away with the individual mandate. The President should let them do so. Yes, the GOP will claim victory. For the Obama Administration, giving Republicans bragging rights is a small price to pay for improving the PPACA, demonstrating his openness to bipartisan solutions, and avoiding a political nightmare of apocalyptic proportions.

This is one situation in President Obama should embrace the call to “repeal and replace.” Doing so is in his own – and more importantly, the American people’s – best interest.

28 thoughts on “Why President Obama Should Jettison the Individual Mandate

  1. I disagree with the writers opinion. If the mandate were removed the whole bill will colapse under it’s own finacial debt. This law is massive and will costs much more then what the CBO can predict. They should scrap this one and go back to the drawing board.

  2. End both wars.

    End all agricultural subsidies.

    End all oil depletion allowances.

    Cut the defense budget by 30%.

    Close down NASA, the Dept. of Education, HUD, and every other non-essential agency, commission, etc.

    We will have plenty of money.

    Put everyone on Medicaid… single-payor.

    That single-payor will dictate what it will pay, thus (finally) containing the cost of health care.

    If docs leave, we’ll train new ones… open up a large medical academy just like the service academies. Offer 10,000 college grads a year a 3 year accelerated medical degree for free (plus $40K/yr. living allowance) so long as they work for 7 years (at $75,000 a year tax free) before going private (similar to graduates of the military academies.)

    If hospitals close, we’ll let the VA take them over or build new ones.

    Problem solved.

    The private sector can’t fix the problem… or it would have by now. They’ve tried HSAs, PPOs, HMOs, POSs, etc.

    For wealthy people who want a private system, there can be one… works well in the UK.

    Bottom line, we really don’t need health insurance companies or health insurance agents.

    Why don’t you or the companies like single-payor? Simple. They lose their profits and you health agents loose your six-figure a year commission checks. Ask anyone in America if they care about either.

    • Alice – The cuts you mentioned would put hundreds of thousands, if not millions of people out of work, and would rock the economy. You are talking about eliminating workers from the tech industry, to education, to health care. You said, “we will have plenty of money.” With unemployment roles like that, and the foreclosures and bankruptcies that would ensue, you would not have any money.

      Tell us how you (and/or your husband) earn a living, and we’ll show you how you are not necessary and should be eliminated. Wild rhetoric like your post is fun to say at a drunken party, or easy to slam around in a forum where your identity is shielded from the targets you are hitting. It’s impossible to institute in an economy where each person relies on the economic stability of his neighbor. Look at the domino-effect crash of the economy after the real estate bust as an example.

      Lots of people don’t want single-payor. It’s not just insurers or agents that dislike government controlled health care. Lots of people don’t want VA hospitals. Lots of people don’t want McDonalds Doctors who earn $40,000 to $75,000 on a govt leash. Lots of people don’t want education for our children cut, either. Tell us how you earn a living, and we’ll show you how you should be eliminated. I’ll bet your industry wasn’t mentioned in the “cuts” you bluntly recommended.

    • Alice,

      It’s scary to think that these are the solutions you have come up with to fix America’s current health care issues. I agree with Ann’s assesment: think of the millions of people who would be put out of a job and the lack of quality education our children would recieve. Take a look at the health statistics for countries with nationalized health care and see how its quality is substantially lower than our current system. There is a reason thousands of people from all over the world come to the US each year and pay out of pocket for their medical proceedures. The reason, simply put, we invest in technology and understand that highly trained and educated doctors deserve to be fairly compensated for the life saving work they perform on a weekly basis. Where do you predict the quality of our hospitals will be if we employed doctor’s of the State?

      There will be a day that you and your family will require the expertise of a trained and certified health insurance agent and I hope you are given life saving advice. It seems only then will you truly relize the valueable role insurance agents play in our healthcare industry. Its easier to demonize and label an industy that you haven’t been apart of than it is to actively try to be a part of the solution. I would be very interested to hear about how you contribute to the betterment of our healthcare system on a daily/weekly/yearly basis like the rest of us do.

      Great post Ann and Curt!

      • I am a nurse. I work for the VA.

        My husband is in the military, deployed in a combat role in Afghanistan.

        I agree that no one is indispensable, but no one is going to suffer a life-threatening occurrence if there are no health insurance companies or health insurance agents.

        Not everyone is motivated by greed and avarice as are most health insurance companies and many of their agents. Given the choice of trusting the Federal government vs. the health insurance companies to do “the right thing” I’ll choose the single-payor government plan.

        As for the VA, how many of your clients or friends or relatives complain about the care they get? True, they may have to drive some distance, but VA care is as good or better than any private hospital in the country.

        Now go ahead and tell me how I don’t contribute “to the betterment of our healthcare system on a daily basis” and how I should give up nursing, quit the hospital, and work in the health insurance industry.

        • Alice, Alice, Alice! Really! Your first post suggested a massive move from private care to government health care. You work for government health care. You suggested that failing hospitals be turned into VA hospitals. You work for the VA hospital. And you call us self-serving????? My goodness! That would be tantamount to one of us suggesting that we turn VA hospitals into insurance-company run health care outlets! I think you just disqualified your talking points!

          I was really surprised when you admitted to being a nurse, and further admitted to working for the VA hospital. In my original response to you, I said you could tell us what you do for a living and we could show you how your own job should be eliminated. But I’ll do a 180 degree flip. You are not indispensible.

          God knows that we need nurses to treat the wounded, comfort and encourage the disabled, and give loving care to those facing the end of life. We don’t know what horrors you have witnessed when treating soldiers at the VA hospital. We don’t know what stress you face as your fine husband labors in Afghanistan, and is too far from home to keep you company. I hope that you can keep bitterness at bay, and treat your VA patients with respect and encouraging care. I worry that you do not, because the bitterness and disrespect in your writing is somewhere between boiling point and volacanic eruption. It’s not normal rhetoric from doctors and nurses, most of whom support the private health care system. I dare say that years at the VA hospital has not worn well on your soul.

          I won’t even try to oppose your statement that “VA care is as good or better than any private hospital in the country,” which is an absurd statement. I fear that your comments backfired, Alice. If this is the government’s idea of quality care, may we fight like the dickens to keep from going there.

        • Ann,

          You are incredible. I just received a really nice email from Alan, who laughingly suggested that a good Marx Bros film might be good for my BP, but after reading your post to Alice, I’m so mellow that I’m just gonna go to bed.

          You really are a very special woman, Ann. If there is a “Mr. Ann”, he is a very lucky man. 🙂

          Spence

        • The VA Hospital system had a well-deserved reputation for inferior care, and the scandal at Walter Reed a few years back no doubt served as something of a booster shot for the conventional wisdom here.

          But in all fairness, the strides made over the past 15 years have been remarkable, with the VA system today exceeding, in some measures, the quality of care through the non-military medical care system. The VA, I think I’ve read, has been particularly good, for instance, at instituting electronic medical records, which is a high priority when your customers–military troops–are being shipped to various destinations all over the world. The VA has also aggressively gone after preventable medical mistakes, taking a host of measures to reduce what the Institute of Medicine has called a huge national problem.

          With all due respect, I urge those who have not read up on the largely unheralded advances by the VA System at large to take a balanced look at the data.

          This press release from last November details a study that may offer a somewhat more up to date perspective:

          http://www.va.gov/opa/pressrel/pressrelease.cfm?id=1994

          Here’s another eye-opener from an article in the Washington Monthly:

          http://www.washingtonmonthly.com/features/2005/0501.longman.html

          Excerpt:

          Yet here’s a curious fact that few conservatives or liberals know. Who do you think receives higher-quality health care. Medicare patients who are free to pick their own doctors and specialists? Or aging veterans stuck in those presumably filthy VA hospitals with their antiquated equipment, uncaring administrators, and incompetent staff? An answer came in 2003, when the prestigious New England Journal of Medicine published a study that compared veterans health facilities on 11 measures of quality with fee-for-service Medicare. On all 11 measures, the quality of care in veterans facilities proved to be “significantly better.”

          Here’s another curious fact. The Annals of Internal Medicine recently published a study that compared veterans health facilities with commercial managed-care systems in their treatment of diabetes patients. In seven out of seven measures of quality, the VA provided better care.

          It gets stranger. Pushed by large employers who are eager to know what they are buying when they purchase health care for their employees, an outfit called the National Committee for Quality Assurance today ranks health-care plans on 17 different performance measures. These include how well the plans manage high blood pressure or how precisely they adhere to standard protocols of evidence-based medicine such as prescribing beta blockers for patients recovering from a heart attack. Winning NCQA’s seal of approval is the gold standard in the health-care industry. And who do you suppose this year’s winner is: Johns Hopkins? Mayo Clinic? Massachusetts General? Nope. In every single category, the VHA system outperforms the highest rated non-VHA hospitals.

        • Ann, I am not sure how or why you decided that my most recent comment was an attack. I simply referenced a large study by the Department of Veterans Affairs and university researchers; plus posted an excerpt from an article in the Washington Monthly that referenced peer-reviewed studies in several influential medical journals (the New England Journal of Medicine and the Archives of Internal Medicine) that concluded the quality of care in the VAH system has made great strides over the past 10-15 years, so much so that it now exceeds on a number of measures the quality of care found in the non VAH system.

          I did not say there weren’t exceptions to this, nor did I imply that the worst VA hospitals were superior to the best non-VAH hospitals. The Mayo model, I think, is superb–and if implemented nationwide would make huge strides in curbing healthcare costs. But doing this, one could argue, would be almost as disruptive to the status quo as converting to a single payer system. Mayo doctors, I am sure you know, are on salaries, get no additional pay for additional tests and procedures and thus have no incentive to run up a patient’s bill, work in coordinated teams, and so forth. You must surely know that many doctors in private practice would find such a system a huge infringement on their current fee-for-service based care model. See the New Yorker’s great piece, The Cost Conundrum, comparing per capita healthcare costs and outcomes in McCallen Texas vs. Rochester, MN. Unfettered free enterprise is no more a guarantee of optimal care than government controls (a la the VAH) are a guarantee of dismal care.

          Neither did my last post in any way editorialize that one improvements in the VAH means we should immediately throw out private healthcare as we know it and replace it with a government-run system like the VAH.

          My only point was that the VAH is just NOT the straw man it once was for those who argue anything government-run is by definition inferior to anything run by private enterprise.

          So how does this constitute an attack? I will stipulate that many of my posts in the past have been attack-ish, but I have been doing my best to keep such impulses under control. In one of your very kindly posts recently, you suggested that rational solutions to complex problems require those who disagree to approach things with a measure of level-headed pragmatism.

          I understand that most of the readers here are health insurance brokers, and that this blog comment section may serve as something of a sanctuary for you all as well as a place to rally your collective hopes and occasionally vent your frustrations about changes that may imperil your livelihoods.

          But it is also Alan’s blog, and I defer to his judgment about whether we non-brokers, who have our own vested interests in the healthcare debate, are welcome to comment here or not, especially when we do so in good faith and present evidence that reasonable people are likely to find compelling and eye-opening.

        • Jim – I did not think your most recent post was attack-ish. I was in fact referring to prior posts, and I did not make that clear. I have seen a new level of respect in many of your recent posts. I do value your input, including your facts about the VAH improving. I agree that the Mayo model is important, and I don’t think it is a challenge to our careers, nor similar to govt run health care. The Mayo accepts private pay and private insurance. They do not accept Medicare.

          You may not realize it, but I value many of your ideas about health care reform, and I help clients every day who face the same anger from high costs that you face. Actually, MANY agents on this board have tried to tell you that your story is one we face every day, and helping those people is what we do for a living. It’s just the battery acid that I have a problem with. Today, I told a prospective client to go elsewhere. Why? Because his right to be vicious ends at my right to not endure it. Rarely does that happen. After 30 years in this business, I can hear a lot of bad news and angry feelings, but still professionally turn it into a productive problem-solving resolution. I just recognize when the person I am conversing with has an intention of resolution, or when they just want to create damage in another person’s life.

          I don’t think your freedom of speech should be disallowed. I just think I should focus on things I find productive. I read your response above, and Alice’s response below. Alice’s response below is another attack, reworded a different way – repeatedly. Her need to repeatedly bash us with her opinion that we are valueless is mentally unbalanced. I took some time to develop a respectable relationship with you, but I’m out of patience now with Alice. I choose my battles, and battling battery-acid rhetoric is not my cup of tea. There are battles I will enter, even though the communication is sometimes uncomfortable – the battle to help a client who is hurting over health care costs, the battle to encourage my colleagues who are facing losses to their careers, the battle for true health care reform, for instance. But I won’t take on an endless battle with a person who feels a bizarre need to inform people that they are valueless and should be eliminated. Mentally unbalanced is my opinion of that.

          I stand by my comment yesterday where I said, “I’ll interact on productive issues. As for me, respectful and sincere opposing viewpoints are welcome, evaluated, and considered valid. Attack rhetoric is not.” This is it for me. I will not again write posts that interact with people who throw battery acid instead of speak respectably.

      • Alice,

        Thank you for the work you do at the VA hospital. I am a firm believer in supporting the military and have much respect for those that serve our great country and those that take care of our brave men and women. I can clearly see now that your negative portrayal of the insurance industry must have come from an experience either yourself or a loved one has been through. It is regrettably true that a fraction of our population do get burned from either an insurance company or an insurance agent, but the same is true for any industry we enter. Take for example purchasing a car that turns out to be a lemon, just because that particular car was bad doesn’t mean the entire car industry should be scrapped and given to the government. That statement is actually funny considering the governments recent bailout of the auto industry, but you get my point.

        The side of the coin that I feel you have over looked is the fact that most insurance agents in this industry are independently contracted and work with several if not all of the insurance companies. It is our job to serve our clients to the best of our ability and lead them to a plan that fits their unique needs. I was trained with the goal of retaining a client for many years by being 100% honest and showing them all their options because that is what leads to a strong business relationship. Agents who sign their clients to expensive insurance plans looking for quick cash run the high risk of loosing their clients at renewal because some other agent will show them a better plan. I put a lot of effort into serving my clients as best I can as I’m sure you do for our veterans every day. My incentive comes from the fact that I strongly care about the quality of plan my clients recieve and the fact that my income depends upon my relationship with them. By moving to a single payor system you are essentially replacing my job with unlicensed “Government Agents” whose livelihood is not based on providing the best possible advice and service to their participants. I hope this helps demonstrate the importance independent agents play on a daily basis.

        Please tell your husband I appreciate his service and I will being praying for his safe return.

        Thanks,

        Brett

      • Alice – please Google “VA Hospitals fail” and that’s just ONE search parameter I can think of off the top of my head.

        Alice I appreciate the bravery and service of your husband. BUT let’s be clear: Your commentary on OUR industry is as whacked as the poor fellows who got off the bus after the Vietnam War only to be greeted with taunts of “baby killer”.

        Further interaction between you and other posters here is as pointless as putting Glenn Beck and Bill Maher in the same room, closing the door and coming back in an hour in the hope of finding these two guys locked in a loving embrace.

        Please don’t give up nursing Alice. Or the VA. You’re great just the way you are.

        • Hi Curt!

          Too bad their reports of great VA care came as news broke this week about the scandal at the St. Louis VA hospital where blatantly filthy medical instruments and improper sterilization shocked the community and exposed 1812 patients to infectious disease. http://www.stltoday.com/news/opinion/columns/the-platform/article_6ee4fc4a-34a4-11e0-a991-0017a4a78c22.html

          It seems the VA did score highly on 11 quality issues (including electronic medical records), but yet the horrendous medical errors remain. Thank goodness the VHA improved!! But recent improvement from a long-time history of nightmarish conditions doesn’t sway us to give our medical care into federal government hands!

          For current comments (2007-2010) from patients about their VHA care, read the comments section in http://www.everydayhealth.com/blog/zimney-health-and-medical-news-you-can-use/va-hospital-problems/?comments_page=4&cmt_sort=0&nkr=1. I googled “quality issues at MAYO hospital” and found NO complaints in pages of google search results. I googled “quality issues at VA Hospital” and found many pages of complaints.

          But I digress… The real issue here is that this is a board for insurance agents, written by an insurance agent. It’s meant to encourage us, support us and help us during perilous times in our industry. I’ll never understand why people like Alice and Jim Thornton believe it’s imperative for them to enter this forum and use attack rhetoric on us, especially while our careers are in peril. Some people enjoy that sort of thing. I’ll accept Curt Cella’s advice that further interaction between us and them is pointless.

          I’ll interact on productive issues. As for me, respectful and sincere opposing viewpoints are welcome, evaluated, and considered valid. Attack rhetoric is not.

        • Ann, you said: The real issue here is that this is a board for insurance agents, written by an insurance agent. It’s meant to encourage us, support us and help us during perilous times in our industry. I’ll never understand why people like Alice and Jim Thornton believe it’s imperative for them to enter this forum and use attack rhetoric on us, especially while our careers are in peril. Some people enjoy that sort of thing. I’ll accept Curt Cella’s advice that further interaction between us and them is pointless.

          I’ll interact on productive issues. As for me, respectful and sincere opposing viewpoints are welcome, evaluated, and considered valid. Attack rhetoric is not.”The real issue here is that this is a board for insurance agents, written by an insurance agent. It’s meant to encourage us, support us and help us during perilous times in our industry. I’ll never understand why people like Alice and Jim Thornton believe it’s imperative for them to enter this forum and use attack rhetoric on us, especially while our careers are in peril. Some people enjoy that sort of thing. I’ll accept Curt Cella’s advice that further interaction between us and them is pointless.

          I’ll interact on productive issues. As for me, respectful and sincere opposing viewpoints are welcome, evaluated, and considered valid. Attack rhetoric is not.”

          Well stated, Ann.

        • Curt, I’m sorry you feel that my opinions about your industry are “whacked.”

          Ann, I’m sorry you believe that the care we give our young men and women in uniform is not up to your standards.

          However, I don’t think either of you have any idea of the kind of trauma we are faced with so I will let both of your criticisms of me and the VA go unanswered.

          I would love for both of you to visit your nearest VA hospital and spend a day there. You would learn much… and see that a public facility can be run as well, if not better, than a private one.

          I was an insurance agent before going to nursing school and later worked in the underwriting department of a large health insurance carrier my last year in nursing school, so I know something about your industry. I still have an insurance license but of course don’t use it. Perhaps that helps “qualify” me to post here… perhaps not if this is only to be a support group for the like-minded, as Ann stated.

          Ann, et. al., I understand that you feel your contribution to the healthcare system is an important one. However, many people, including myself (if I’m allowed to express such a thought) see you as superfluous, as are private insurance companies.

          Look at the facts.

          All over the country agent commissions have been cut by 50% or more… by your own carriers. If THEY don’t value your role and contribution, why do you think those outside your industry do? What is the message they are sending you?

          Correct me if I’m wrong, but the blogger on this board seems to be sending the message to agents that it is time to move on… that the health insurance boat has sailed, and that if you want to have a value-proposition in the insurance industry it is best to consider a different sector… maybe life, annuity, disability, etc.

          Given the commission cuts, it seems that the free market has spoken. Health carriers could have cut their own costs and maintained your compensation levels. However, they decided to keep their margins and their (obscene) executive salaries (find out what the woman who is CEO of Wellpoint makes a year!) instead of keeping their agents with a sustainable “wage.”

          How “appreciated” do you think you are in your own industry? (And perhaps you need to ask exactly how much your NAHU really did for (or to?) you?)

          As a nurse I often know what it is like to be unappreciated and undervalued. However, the work we do (like that done by teachers and police and fire fighters and social workers) is its own reward. I can only hope for your sake that selling health insurance for much lower compensation is reward enough for you as well.

          I’m sorry to have intruded in what seems like a close knit band of brothers and sisters. I thought that all opinions would be welcome here, but I was wrong. I shall not intrude again.

          Single-payor is coming, if not eventual nationalization of the entire system (like the UK) and I believe it will be a good thing for America. I understand and appreciate that you disagree… but I simply don’t see any of you having a seat at the table and having much influence over what the future is going to bring.

          Thank you for your kind attention and I hope you find success and personal fulfillment in your future.

    • And so ends this thread.

      Although Alice’s original comment was a bit tough, I thought it appropriate to let it stand. She expresses a not uncommon viewpoint. Too often those of us deeply involved in the world of health insurance lose track of the reality that not everyone sees thee world the way we do. America’s a diverse country and it’s not surprising that there are diverse opinions as to how our nation’s health care system should work. And just because we may feel strongly that our perspective is right, doesn’t mean everyone will agree. In fact, they are many who will feel just as strongly that their perspective and conclusions, while diametrically opposed, are absolutely right.

      Too often, especially when the dominant voices are in general agreement, it’s easy to forget that we operate in a world of competing views. Alice’s views are contrary to those held by many readers of this blog, but hers is hardly a unique perspective. Again, while it was presented in a rough fashion, I thought worthwhile to include it.

      The thread, however, has deteriorated. I would have ended it earlier, but I’ve been on the road. Managing this blog on Blackberry typing with my thumbs is a skilll I’m still developing (I think you need to be under the age of 30 to really be adept at thumb-typing). So while I have access to a reall keyboard, I’m ttaking the opportunity to declare this thread officially closed. I’ll be deleting any future contributions from any and all commentators. I appreciate the passion and interest you’ve all shown, but it’s gone far enough.
      Thanks,
      Alan

      P.S. Until now I haven’t had a chance to read Alice’s comments all the way through I’m wondering if “Alice” is for real. Does it strike anyone else as a bit too sweet that she’s a nurse at a VA hospital, married to a war vet who was once an insurance agent who talks NAHU politics and worked her way through nursing school as an underwriter and … well, you get the idea. Reading through her overheated rhetoric, I believe I hear the sound off chains being yanked. No way to really know — her email address is a generic one, but call me skeptical. Even if it is just someone trying to raise a fuss, the fact is there are still millions of Americans who would prefer a single-payer system to the PPACA or to what we had previously, who think that health insurance agents and carriers are unnecessary if not detrimental to the country’s well-being. It’s important to step out of our own echo chamber now and then to hear them. Which means whether Alice is legit or not is unimportant. By providing us a reminder of this reality she’s provided readers of this blog a useful service either way.

  3. Very interesting commentary, Alan.

    Personally, I’d like to see “Individual Responsibility” tied to our overall societal thinking than just to health insurance, also. As written, it only applies to Health Insurance, specifically major medical – Auto insurance, while mandated be carried in and by most (if not all) states (or the ability to prove “Financial Responsibility”, usually by having $400 in the bank, “Big Whoop”) could be mandated, with far stronger consequences, federally. Long Term Care insurance presents the same dilemma. How many apathetic Americans have said, “I’ll buy it when I need it”, “I took care of my children, now they can take care of me.”, “I’ll never need to go to a SNF, my parents were health and then just dropped dead and so will I.”, “I’m not worried about leaving anything for my children…they all do well, and don’t need any of my money.”, “I hate my children, and as for my grandchildren…well who do you think is raising them?”, “I paid my taxes, now the guv’mint can pay for me!”, the list of excuses goes on and on. Certainly, it would be difficult if not impossible to mandate that the public carry Life Insurance, but mandating that the public, on a means tested basis, carry any form of insurance, that without that benefit might assure that the individual will end up on the “Public dole” seems reasonable.

    Can’t pay for the insurance and take that two week trip to Mexico, tough. Go for one week, instead. Or, don’t go at all.

    Being Individually responsible is not a concept that has been in much favor in recent years. Perhaps, it’s time we change that dynamic.

    • Actually this brings up an interesting point that might make for an interesting argument before the bench: Where do you draw the line on any of this? Shall we mandate that people start saving early and often when it comes to retirement savings? More people with more money in the bank might mean the ability to raise Soc Sec benefits to age 72 or higher….think of the benefits to aiding the national debt.
      Or how about mandatory LTC coverage? There’s a product you would kill for if circumstances called for you to have nursing care in this country but how many of us can afford it…? Prices would surely fall if everyone was mandated to have it according to the same minds behind PPACA.

      Why stop with a mandate for health insurance? Let’s take this to its logical conclusion and start mandating that people have what is necessary for them to be self reliant and less of a burden on the public dole…

      • “Why stop with a mandate for health insurance? Let’s take this to its logical conclusion and start mandating that people have what is necessary for them to be self reliant and less of a burden on the public dole…”
        ________________________________________________

        Ah, Curt,

        Do you think I might disagree? Mais non, mon ami, I DO agree. I, for one, am tired of paying for those who choose to choose for themselves, knowing that if they make the wrong choice You and I will have to pick up their mess.

        🙂

  4. This morning, a local newspaper columnist made what I thought was a pretty amusing case for how the government currently forces us to buy some commercial items, whether we want to or not. These items: clothes.

    Unlike the argument about car insurance–technically, we don’t HAVE to buy this, we can choose to walk or take the bus–the case with clothes is not quite so open to vacillation. I suppose somebody could argue that technically the government doesn’t force us to buy clothes, either–we can elect to never leave home (which begs the question of whether the government forces nudists to buy housing), or hide behind bushes when we absolutely must go out. But practically speaking, it’s pretty hard to argue that the government doesn’t force us to buy clothes.

    Thus, I would argue, a precedent has been set, and in my view, the Supreme Court must either rule in favor of the individual mandate or rule in favor of eliminating all laws about public nudity.

    Of course, I am viewing matters through a certain perspective here, one that would like to see the whole country covered by health insurance, or, barring that, the whole country uncovered by clothes. Which, when you think about it, might do more than health reform will to curb the obesity epidemic.

    But I wander.

    Alan, this is your most pessimistic blog entry to date. What you are preminiscing here, if I am reading things right, is that the chances of chaos are growing exponentially. It’s almost like Egypt. Who knows what will happen when, or if, the smoke ever clears?

    One thing that I do agree with Ann about is that in this kind of highly charged contest, rationality no longer matters much. You made the point yourself: the individual mandate was largely a Republican idea; now it is largely a Republican anathema. If Obama takes your advice and eliminates the mandate, I doubt it will take more than a few nanoseconds for adversaries of meaningful reform to peg new PPACA outrages to vilify, and the media of the right to begin broadcasting the new talking points about same 24/7.

    I honestly believe that if Mitch McConnell wrote out a script for Obama to read, one that outlined exactly what McConnell et al wanted to see happen re: healthcare, and if Obama then read this script to the nation in primetime, and worked tirelessly to make the words come true, and somehow managed to shepherd every single item on the Republican wishlist through to passage down to the last detail, then Mitch would immediately turn around and use Obama’s “inability to think for himself” as a chief reason why he shouldn’t be elected.

    Until reading your blog, I had some sense that the penalty for ignoring the mandate was modest, but I hadn’t realized just how tiny it actually is. I completely agree that this is a bad thing and recipe for disaster and gaming of the system. I am sure there is no shortage of other items that weaken, maybe even doom, the PPACA even if it does survive passage through the “Scallia and Charybdis” Supreme Court.

    But the old status quo was also sprinkled liberally with its own seeds of doom.

    Alas, those for the bill and those against it are so embunkered now in their positions that I see no prospects for compromise that could make things better. Like adversaries in a war waged far too long, it looks like we’ve reached the Blood Simple stage where both sides have lost sight of what they’re fighting for. Even victory has lost its appeal: partisans only want to see their enemies lose.

    I think there’s going to be lots of losers.

  5. Quite simply, we don’t need the government involved at all on this. If the want to spend money, let them send each state 25 million bucks to help with state high risk pools.

    Add incentives for those that carry coverage and utilize preventive benefits and we have a winner!

  6. Wow! Does that open up a whole new can of worms!

    Twenty Six states sued for a reason. It wasn’t really the individual mandate, it was broader-based disagreement with PPACA. They just focused on the individual mandate because it was a big huge target hung out there, and the easiest thing to hit,which would in turn defeat the entire bill. The reason it defeats the entire bill is two-fold, one because “must cover” without “must carry” doesn’t work, and the other reason is because PPACA didn’t include a severability clause which says if one portion of the law doesn’t stand, then other portions of the law are left intact. The severability clause was in the first versions of the bill, but Obama and Company intentionally deleted it from the last versions, which hardly leaves them room to complain.

    So, if Obama jettisons the individual mandate, that still doesn’t solve the fact that more than 50% of the states want PPACA to stop. Perhaps Obama can negotiate with them by giving them waivers against the heavy burden he laid on state medicaid budgets. Would that make the states throw in a white towel and give up fighting?

    There are already so many waivers, exclusions and delays. The 1099 reporting was delayed and will probably get cut, grandfathering rules were altered, and then grandfathering was delayed, mini-meds were waived, PCIP didn’t work out even after rates were reduced, some state exchanges and medicaid burdens are waived or lessened… When do we just call in the “end-of-life counseling” and call this thing dead?

    I doubt the Republicans are going to hand-deliver an alternative to Obama in exchange for deleting the individual mandate. If Obama deletes the individual mandate, the Republicans will probably just let him hang out to dry… After all, even the Democrats agreed that the PPACA would implode if the individual mandate dissolves. Look at NY and NJ as examples of VERY high premiums for a guarantee issue state with no individual mandate. Some people are saying nobody will buy insurance “until they get sick and need it”, but when they get sick they may find it’s still cost prohibitive. So, let’s say Obama jettisons the individual mandate and the Republicans let him and PPACA hang out to dry. Would Democrats be happy and want to re-elect Obama?

    Democrats are screaming that “popular” elements of the law that were enacted early will be reversed if the law is found unconstitutional. But really… The cost of unlimited maximums, adding 19-26 year olds, and free preventive care is manageable. Insurance Companies actually “fixed” PPACA’s error by installing some of these privileges earlier than required. I don’t see insurance companies scrambling to reverse their decisions. They’ll probably keep them and give opponents less reason to attack later.

    I can’t see how Obama could win by deleting the individual mandate, and if he loses in the Supreme Court, I can’t see how he can win at all. Am I missing something?

    • Ann I’m with ya! If all we’re left with is unlimited maximums, adding 19-26 y.o., and free preventive then why in the name of Joe Biden was this is a “big &#%#^# deal Mr President?! I’m awaiting Alan’s response to my question which was completely sincere: If you get rid of the individual mandate why in the name of California’s widening deficit does any state need to run an Exchange? It just becomes like Utah’s exchange which is pretty much there in name only. We already have a system to sell health insurance to those who want to buy it: It’s called insurance companies and INDEPENDENT AUTHORIZED AGENTS from sea to shining sea!!!!

  7. Alan,
    If you get rid of the individual mandate why in the world do we need the Exchanges? Are you saying the Exchanges get flushed along with the individual mandate?
    Help me out here: I saw all these pieces as being interconnected – if you toss one element like the indiv mandate over the side why have the Exchange? What is that bringing to the party? Just more taxpayer dollars being flushed to build yet more government infrastructure we don’t need?

    Also if you toss the individual mandate what was all this about? Getting the insurers to drop lifetime limits and to keep young adults on family health plans when the 18-26 market was already ENTIRELY affordable unless God forbid the kid wasn’t healthy? Tossing the indiv mandate is a giant red flag that this was all much ado about nuthin’ and there is also the possibility that Obama doesn’t want to go the “Geo W Bush – “Read My Lips – No new taxes'” route either.

    Good grief: Why didn’t we just create an AFFORDABLE option for those who have pre-existing conditions and make it affordable….oh that’s right; we did: PCIP.

  8. I hear the political logic but find the finances less compelling. Repealing the individual mandate without repealing guaranteed issue means that many people with coverage today will lose it, either because their employer can no longer afford to support it, or the individual can no longer afford to pay their percentage of the premium… and few but the wealthy will be able to afford private individual/family coverage. With guaranteed issue, I can go without coverage as long as I want until I get sick. Then it’s a matter of paying the health care providers to get care, or paying the insurance company to get care. Six of one, half a dozen of the other because most Americans will go bankrupt long before they’re able to cover the cost of any significant illness or injury… which means they’ll drop into Medicaid-land, which will put pressure on the Federal budget, which puts pressure on the taxpayor. Pay now. Pay later.

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