Why Not Delay the Individual Mandate?

This is from Roy Ranthum:

The Urban Institute issued a one-pager yesterday contrasting the effects of the employer mandate delay (hint: extremely minimal) with the massive turmoil that a delay in the individual mandate could cause in the health care market. While delaying the employer mandate has been forecast to have a relatively small-scale impact on the rollout of ObamaCare, the delay of the individual mandate would drive up uninsurance, send premiums surging and destabilize hospitals with already-troubled cash flow.

Comments (14)

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  1. BHS says:

    If only we could rewind back three years ago before this thing was ever passed…

  2. Wayne says:

    Is this necessarily a bad thing?

  3. Lucas says:

    “And finally, delaying the individual mandate is likely to result in a significant increase in uncompensated hospital care relative to full implementation of the law, putting hospitals at greater financial risk.”

    Again, Ted Cruz, please stop. You are not helping.

  4. Connor says:

    I can understand the Ted Cruz is trying to make a point, but he has far more selfish reasons than that he is doing it for the people.

  5. Chris says:

    ACA:

    Previously uninsured, now insured: Minimal
    Insurance Premium: $4,000
    Remembering the days without Obamacare: Priceless

  6. Stella Baskomb says:

    Last year I had no insurance because of a pre-existing condition.

    Next year I’ll have no insurance because I still can’t afford it.

    In only a few years I’ll be eligible for Medicare, but it will probably be broke by then.

    I feel sick.

  7. Bill Huber says:

    Okay, let’s get real. My family is healthy and we purchase our individual through the individual market. Our rates are low compared to the Affordable Care Act. We have a real possibility of 100% increase in our insurance premiums. I have skin in this game.

    I read the Urban Institute article and although I am at the greatest risk for unintended consequences,I am still in favor of postponing and eventually getting rid of the individual mandate. Despite their arguments the Individual Mandate is still a really dumb idea. Here is my reasoning:

    1. If uncompensated hospital care is the primary problem, then I prefer our existing system in which these costs are spread over a much larger population.

    2. If adverse selection is the primary problem, the Affordable Care Act proposal is only slighter better than doing nothing. Even the ACA supporters recognize that their proposal most likely will not work if the a few high cost patients get insurance(charity) in the individual market. This market is just too small to support many high cost participants. The only workable solution is to spread this charity over a larger population group. There are several ideas on how this can handled.
    1. Some ACA supporters argue that we need to go to a single payer system and the failure of the individual market is part of the path to this final solution.
    2. A few others are arguing that we should single pay these high cost un-insurable patients. I call this the Medicaid solution.
    3. A variation of #2 is that we expand the high risk insurance pool. The ACA high risk pool is presently closed to new participants.

    My gut feeling is that the most successful plan is to stick the insurance companies with the un-insurables and let them lobby the state/Congress for help. When you piss off the middle class, you should expect that there are consequences.

  8. Bob Hertz says:

    Bill, you offer two decent solutions to the high cost uninsurables, either a kind of Medicaid or an expanded high risk pool.

    But both of these require new federal tax revenues. The recent Republican alternative to the ACA had in it only $25 billion over 10 years for high risk pools. That is ludicrously too small.

    But let me go on to my main point. The mandates and penalties in the ACA are pretty weak even now. They do not have far to go to ‘postpone themselves.’

    No one faces a penalty if the cost of health insurance in the exchanges exeeds 8% of their income.

    Picture a family making $90,000 a year. The cost of family health insurance (even with tiny subsidies at that level) is a lot more than $7200 a year (8% of $90,000.)

    Even the few who do have penalties can only be chased down by the IRS if they are due to get money back on a future tax return.

    So all in all, I think that the mandates are a minor point.