Heath care: explain 'the mandate' to me.

Great Debates
1

So it looks like most versions of the health care bill have some sort of “mandate” clause that requires people to buy health insurance or pay a penalty (except for those who can’t afford it).

I thought the whole point of health care reform was to make it more accessible, cover more people, correct some abuses in the system… How does ‘the mandate’ help with this? On its face it sounds as absurd as fighting hunger by passing a law requiring people to buy food (except those who can’t afford it). Seriously, WTF?

2

A lot of people who can afford health insurance choose not to buy it because they don’t think they need it. Most times they are right, but when they aren’t they have absolutely no way to pay for their healthcare costs.

3

Well, duh, but so what? I support health care reform to help people who can’t afford it or make it more affordable for everyone, including some variant of a public option. People who aren’t covered because they simply refuse to be? Department of Not My Fucking Problem. Please explain to me how addressing the latter case helps the former case.

4

The idea is that forcing all people to buy insurance (even if they don’t want it), it adds more money to the overall pool.

5

It lets the government force you to pay more than the health insurance is worth, to subsidise the coverage of the unhealthy/low income people. For example, if the penalty was $900, insurers can safely overcharge you by up to $900 per year without significantly hurting demand - you either lose $900 by buying their overpriced insurance or you lose $900 by having it taken by the government. Either way, the government has taken $900 of your money and assigned it to subsidising other people’s insurance.

6

If you think you don’t need health insurance and don’t buy it, then when you need medical attention you’re forced to go to the ER and the hospital has to eat the cost, which gets passed on to the rest of us one way or the other.

7

Thanks guys, I get it now. It actually sort of makes sense, maybe a little more efficient than just extracting money as a direct tax.

Although it makes sense intellectualy, I still can’t shake the feeling that this smells odd… as I said before, a bit like requiring people to buy food unless they can’t afford it.

Also, isn’t this just a giant sop to the insurance companies, basically guaranteeing them additional revenue in exchange for their agreement to do - what, exactly?

8

No, it is your fucking problem. At least, if the overwhelming consensus is that we don’t want dead bodies and crippled beggars all over the streats, and don’t want hospital entrances choked with the bleeding and pockmarked, and don’t want our 20-something year old kids who happen to snap their necks relying on us 24/7, then we are going to buy medical care for all these people somehow or another. The way we are doing it now is just very expensive and inefficient.

9

To a certain extent you’re at the crux of this.

Health care reform is an existential threat to one of the largest, most rich industries in the country: Health Insurance. By requiring a mandate, and limiting public option insurance, the health insurance industry can be bought off, for a time, by the prospect of increasing their customer pool by federal mandate. I think it’s a short term win for health insurers but it’s still a gain.

Mark my political insight: Any form of health insurance/care reform that passes this year will be a transitional event. Eventually, in less than 10 years, a full-scale public option health care insurance provided by the federal government will be enacted.

10

In a much less critical case, this is why almost all jurisdictions legally require drivers to carry car insurance. Curiously, I hardly ever hear anyone complain about that.

11

Slippery slope! Right there, everybody come see the slippery slope inherent in the system!

12

Perhaps because it isn’t really the same.

You do not have to insure your car against damage to it… you do have to insure against damage that you might do directly to someone else or their property.

13

Just how profitable is the health insurance industry? Not in gross numbers because it is a big market… how profitable is it as a percentage of revenue and how does it compare to other markets?

14

Well, they are actually pretty close.

Here’s why:

First, let me summarize your argument.

You agree that it’s OK to make you insure your car to ensure that third parties won’t have to pay for damage you cause. This is because you shouldn’t be allowed to choose whether to pay for costs you impose on innocent third parties.

You agree that it’s not OK to make you insure your car to repair damage you cause to it. That is, fundamentally, because you will bear all the cost of that damage. You break your car, either you pay for it, or you don’t have a working car. Nobody else has to pay.

I.e. You’re OK with making people buy insurance for costs they cause which others would have to bear, and letting them freely choose whether to buy insurance for costs they alone will have to bear.

That seems to me to be a fair summary. Agree?

Now let’s talk about body shops.

In the context of car insurance, there is liability cover (for injuries to third parties), and collision insurance (for damage to your own car). By your argument, people ought to be able to choose whether to buy collision, but it’s OK to make them buy liability.

Why is that? It’s because you can’t make anyone else pay for the damage to your car if you are uninsured, and don’t have the cash.

A auto body shop doesn’t have to serve you. If you can’t pay, they won’t fix your car.

So if you crash your car, and you have collision insurance, it will pay for the repairs to your car. If you don’t have collision insurance, you have to pay for the repair to your car. If you can’t afford to fix your car, it doesn’t get fixed.

If you have enough money for insurance, but not enough to fix your car, you get to choose between buying insurance, or not buying insurance–and hence, between getting your car fixed if it has an accident, and not having your car fixed.

That’s auto insurance.

Now let’s talk about hospitals.

If you get sick, and you have health insurance, you go to the hospital and (theoretically–assuming they don’t fight you on the charges, assuming you get all the paperwork in order, assuming there isn’t some omission on your medical records/application that the insurer can use to deny you cover, etc, etc,), your insurer will pay for your treatment.

So far, just like auto insurance. If you buy insurance, it covers injuries to you.

However, there is a big difference. An emergency room cannot refuse to treat you because you can’t pay them. It’s not like a body shop. Emergency Medical Treatment and Active Labor Act - Wikipedia

Now, what happens if you don’t buy insurance? Again, let’s imagine you have enough money to buy insurance, but not enough money to pay for treatment.

You go to the hospital. It has to treat you. It tries to collect, but you don’t have enough money. What happens?

Somebody else has to pay-the hospital has to pay for supplies, the doctors salaries, malpractice insurance (because you can sue them, even if you didn’t pay them)–it will do so by charging other patients more to cover the loss it just suffered, or the government will pay (through subsidies, etc.).

In other words, if you show up to a body shop and you’re uninsured, you are the only one who suffers the loss-either you have to pay, or you don’t get your car fixed.

But if you show up to a hospital, and you’re uninsured, the cost of your treatment will be put on other people if you can’t pay.

And that is exactly the kind of thing you have already argued we should be able to force people to insure against–costs you impose on innocent third parties. I’m one of them–I have health insurance. It’s expensive because (among other things) hospitals have to charge patients who do pay more in order to cover the treatment they are legally required to give to those who can’t pay.

The only way your argument makes sense is if we add one of two distasteful rules, so that you can’t force me to pay for your treatment :

(1) either hospitals can turn you away at the ER door if you can’t pay. Have a heart attack? Sucks to be you.

(2) or you pledge when you choose not to get insurance that you will never seek medical treatment you can’t pay for. Again, have a heart attack? Sucks to be you–sell the house, or die.

Unless you include one of those two rules, health insurance just isn’t like collision insurance for your car.

Instead, health insurance looks a lot more like liability insurance–at least for a basic plan–something that prevents you imposing the cost of your treatment on other people. And that is something I think we should be able to mandate people buy.

Now don’t get me wrong. I think hospitals should be required to treat anyone who comes in their door. I think we should pay for that treatment by universal healthcare, or an insurance mandate (combined with a subsidized plan for those who can’t afford market rates). We already are paying for the treatment of the uninsured poor–but now, they’re being treated at the ER–the most expensive way, rather than being able to get preventative care, and avoid getting sick.

15

It’s even worse than that. They’d have to refuse to treat, even if you had insurance, until you could show you had up to date insurance. If you are unconscious and don’t have your wallet it’s tough titties. Even if you are conscious and don’t have ID, why would they believe you?

It’s not often in life that one is presented such a clear case: every other industrialized country in the world has UHC, they are all cheaper than the US, and the vast majority have better results. Europe, which has a higher incidence of disease than the US because they smoke more, still has longer life expectancy. In fact the only demographic in the US that has a longer life expectancy than Europe are people over 65 who have UHC through Medicare.

The gun-control crowd is often presented with statistics that show this or that state or country has a lower murder rate while having less control on guns. That is certainly thought provoking, and makes one wonder whether the availability of guns alone is enough to curb our murder rate.

In this case, EVERY other industrialized country with UHC has better results than the US. Think about it, every single other frikin’ country.

16

That’s a related point—and even further, insurers do try to fight paying claims–so even if you can prove you’re insured, that isn’t proof that the insurer will eventually pay the claim. To really ensure payment, hospitals would have to get the claim approved before looking at your heart attack. Not enough time? Tough.

That being said, all of that is a bit of a tangent to the point I’m making. My point doesn’t turn on whether health insurance is or isn’t perfect (so that hospitals all know you have it, all hospitals take all insurance, and insurers pay all valid claims promptly and without dispute)—because even “perfect” health insurance just isn’t like collision insurance. Those without health insurance and without the ability to pay can and do make others bear the cost of their treatment.

Hence, I’d like to hear how opponents of a mandate want to solve the problem: are they OK with allowing hospitals to have their first test be a “wallet biopsy”? Are they willing to pledge they will never get any treatment that their insurance doesn’t certainly cover, and that they’re not ready to pay cash for?

17

The mandate to buy insurance is needed because they are also including rules that there can be no medical underwriting anymore (pre-existing conditions). If insurance companies are required to cover anyone that applies for it, along with the limits on premiums, then the only way it stays affordable is if everyone is required to buy into the system.

18

The government will provide assistance to those who can not afford it, on a sliding scale. Almost everyone will be covered. I suppose doctors offices will become more crowded. It is hard enough to get an appointment now.

19

Perhaps. On the other hand, all those people who now find it hard enough to get an appointment now because no primary care physician will see them without payment, and they can’t afford it, will find it easier to get an appointment.

Also, (just my two cents): there will be two great advantages of universal insurance that may cut against the issue of more demand for primary care physicians:

(1) Cost efficiency
hospitals and doctors will get paid for a lot of the care they now have to write off (i.e. that provided to patients who they are legally required to treat, but who are uninsured and can’t afford to pay–but who would have insurance after reform). So they’ll have more money to recruit doctors.

A similar argument applies to any reform that reduces the administrative cost of healthcare (since insurance, as it exists now, isn’t particularly efficient, with a lot of money going to administration)–at least some of those savings will surely be shifted to pay for treatment, rather than administering health insurance).

(2) Efficient use of medical resources.

Currently, a lot of the uninsured don’t have a primary physician. They go to the ER when they get sick–which is (1) more expensive than seeing a family physician, and (2) is fairly frequently to treat a condition that could have been avoided/treated much more inexpensively if it was caught early (by, for example, regular preventative care).

So universal healthcare/an insurance mandate will free up many of the staff and resources now used to provide emergency care to uninsured patients/ treat major illnesses that became major due to a lack of preventative care. This will provide more resources for both primary care, and free up specialists who are now busy dealing with patients who didn’t seek treatment until they were very ill.

20

One huge problem with the current mandate is that if you live outside the US, you still have buy insurance - except it will not be valid outside the USA.

So if it passes as written, my wife and I get to pay a $3800 per year fine because we have to buy insurance, but no insurance company will issue it to us as we have a foreign address.