Friday, June 20, 2008

Mandates Are Not The Answer

David Gratzer and Paul Howard explain why, "Mandates Are Not the Answer". Here are a few excerpts:
Liberal proponents think of mandates as social insurance. Many of the uninsured are younger and healthier, they note, so forcing them into insurance pools will result in lower average premiums. Some conservatives, meanwhile, argue that uninsured people use emergency rooms but often don’t pay, offloading their health costs onto the rest of us. It's not simply about coverage, in other words; it's also about personal responsibility. At a debate in Texas, Clinton made a similar argument, claiming that without mandates, "every one of us with insurance will pay the hidden tax of approximately $900 a year." Conservatives like Duke University health expert Christopher Conover, former Massachusetts governor Mitt Romney, and former Republican National Committee chairman Ken Mehlman have all made some version of this claim.

...[E]vidence shows that costs are influenced much less by mandates than by consumers’ ability to buy a broad range of competing health-insurance products. An insurance policy for a single male resident in mandate-enforced Boston, for example, costs five times more than a policy for his identical twin in mandate-free Tucson. This cost disparity is due in part to the Bay State's many insurance regulations, which limit the types of policies that consumers can buy and drive up prices. As for the responsibility argument, uncompensated care costs federal and state governments roughly $40 billion a year—in a health economy that tops more than $2 trillion annually. That's a very small percentage of the total expenditure and certainly doesn’t amount to a hidden tax of $900 per person.

...Mandates offer the illusion of fixing our health-care problems by extending insurance to all.
More fundamentally, individual insurance mandates violate basic individual rights by forcing people to spend money according to the government's priorities, rather than according to their own judgment. Once a government decides that everyone has to purchase health insurance, it necessarily must decide what constitutes an acceptable policy. Patients and insurers are then forced to abide by the government's decree, rather than negotiating for their own mutual benefit in a free market, further violating individual rights. Rather than solving the problem, mandates merely worsen the harmful government control over medicine.