Why we need the health care mandate
Perhaps the most controversial part of the Affordable Care Act is the requirement that everyone have some kind of health insurance coverage that meets minimum standards, whether that’s Medicaid (for the poor), Medicare (for the elderly and disabled), private or employer-sponsored insurance, or participation in one of the new health insurance exchanges created by the Act. The exchanges are the only new programs, the others being there long before. But the key is that people without insurance are not only offered the opportunity to sign up for heath insurance, they are required by law to do so, facing stiff IRS penalties for failure to do so. This part of the law has raised all kinds of libertarian and free-market objections: how can the government require you to buy something? Why can’t you just decide for yourself to buy or not buy and live with the consequences either way? It’s been described as a gigantic overreach of government power. I want to argue that, like it or not, the mandate is actually necessary. (Full disclosure: while I’m a physician myself, I’m a salaried civilian employee of the U.S. Army, treating exclusively soldiers and veterans and their families whose care is paid for in full by Uncle Sam, so in my present job I don’t have to deal with the problem of the uninsured. But I’ve done in so in the past both as practice owner and employee in civilian life. And as a patient, I pay health insurance premiums like everyone else.)
Health care is different from the other goods and services in the economy, and even the most fervent believer in the free market has to admit that applying pure free market economics to health care yields bizarre and unacceptable results. When sick or injured people show up at the hospital, we take care of them regardless of their insurance status, their citizenship, or their ability to pay out of pocket. We have to do this — it’s the law. It’s a law we could change, I suppose, but really, do you want hospitals putting sick people, laboring mothers, or trauma victims out on the sidewalk because they can’t pay? No. So we (doctors and hospitals) take care of them anyway, and hospitals and private practice doctors eat the costs if the patient can’t pay. You can try to play hardball and send the bill collectors and lawyers after them, but for the most part getting paid for no-pays is hopeless. In the end, if you persist, they’ll just declare bankruptcy and you get nothing. So keep that in mind the next time some hothead legislator decides to cut off Medicaid funds for some group of people he doesn’t like. We in the medical field have to take care of them anyway, but without Medicaid we do it without even the puny reimbursement Medicaid provides. Cutting off payment only hurts doctors and hospitals, not the people you’re trying to punish.
The point is that free market economics is predicated on the possibility of not having a transaction at all if the two parties can’t agree on a price. Can’t afford a car? Walk. Can’t afford a restaurant meal? Eat somewhere else. Can’t afford a new pair of shoes? Wear your old pair of shoes. In health care, we can have free market practices among more affluent people, who can pick the doctors and hospitals and health care plans that give them the best service. But at the bottom end, we cannot put people out on the sidewalk with no money and no insurance. We – doctors and hospitals – have to take care of them, whether we get paid for it or not. And that, in a nutshell, is why health insurance has to be mandatory.
Most people have forgotten one of the most talked-about issues in the 2008 primary race between Barack Obama and Hillary Clinton. Both were advocating for universal health care, but Obama balked at the notion of requiring health insurance, which Clinton insisted was necessary to make the system work. Obama never broke with that line during the whole campaign. But once in office, when he and his staff started doing the math, it became clear that you can’t get universal coverage without requiring everyone to be in the system in some way, requiring everyone to pay their own way (for now leaving aside Medicaid, which long predates Obama and Clinton). When it came down to it, Obama saw that Clinton was right on what had previously been a hotly contested point: if health insurance is going to cover everyone, everyone has to have health insurance.
And of course, now the mandate is the most controversial part of the Affordable Care Act, widely despised by people who say they don’t need it and can’t afford it. Now upheld by the Supreme Court and a survivor of uncountable attempts to overturn it in Congress, the health care mandate is the law of the land.
But let’s think about what people are asking for who want the right to forgo having medical insurance. What they really want is to mooch off of everyone else. They expect to be cared for if they have an auto accident or catastrophic illness, but almost no one has the personal means to pay for it even if they have good intentions to do so. So the costs of their care are eaten by health care institutions and professionals who necessarily pass these costs on to people who actually pay into the system. Furthermore, if they’re not getting the (relatively cheap) routine management of their health problems like hypertension and diabetes, they end up in the hospital later with major problems (heart attack, stroke, kidney failure, gangrenous limbs to be amputated) that are very expensive to care for. A Pap smear is dirt cheap compared to treating cervical cancer. Routine healthcare is a good investment, as opposed to paying for the consequences later. And believe me, we do pay for it, all of us.
The unfortunate reality no one really wants to face is that health care is unbelievably expensive. This is not a matter of politics, this is just medical economic reality. There is a certain amount of waste and inefficiency in the system, but it’s mostly a function of getting the best health care in the world, from people who are paid like the well-trained professionals they are. You want people on minimum wage taking of you? No? You want the best medicines, procedures and medical devices available? Yes? Then get out your checkbook. It’s an expensive business.
This is why we can’t have people not pulling their weight by paying into the system. Paying health insurance premiums is painful for young couples and people just starting careers and businesses – but it’s painful for the rest of us, too. There is an economic level below which we can’t reasonably expect people to pay what it takes to take care of them – hence Medicaid – and we can have a legitimate argument about what that level ought to be. Should we lower the Medicaid threshold and have more people paying, even if they say they can’t afford it? Or should we raise the Medicaid threshold and provide more relief for starting and lower end working people, at taxpayer expense? But wherever that threshold is, we can’t have a whole class of people with jobs who pay nothing into the health care system. There’s a fair share for everyone to bear.
So the free market argument against the health care mandate simply doesn’t fit the reality of caring for human beings. Ironically, the free-market advocates are actually facilitating healthcare freeloaders, who want the rest of us to pay for their healthcare. We need to provide at least basic healthcare for all Americans, but we can’t do it for free, or for cheap. And everyone is going to have to pitch in. Everyone.
There’s a bigger question here, of course: what’s really behind the fury of the Right about the Affordable Care Act? Is all this drama really about political theory about the size and role of government, or economic theory about how free markets should operate? Do everyday people, even among conservatives, really care that much about this sort of thing? Or is there something darker lurking in the corners? Of course there is, but we’ll have to save that less pleasant conversation for another day.
Mark A. Plunkett
Columbus, GA March 1, 2016
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