Sunday, November 27, 2011

Will Healthcare Deform Survive the Supreme Court?

The healthcare reform deform bill that was signed into law in 2010 and whose most controversial aspect, the so-called "individual mandate", will be phased in starting in 2014, is now being taken to the Supreme Court after an appeals court recently struck down the mandate.  And much more is at stake than just this particular law.  Regardless of which way they rule, a landmark precedent will be set that will influence future court decisions, rightly or wrongly.

We at the TSAP believe that the individual mandate is unconstitutional and must be struck down.  There are several reasons why such a mandate is wrong on principle.  Not least of which is that forcing people to buy an overpriced, defective product from a private company year after year under penalty of law is about as constitutional as a poll tax.  But what about the rest of the 2400 page law?

Many folks, especially those in the insurance industry, are terrified that getting rid of the mandate but leaving the rest of the law intact would create an unsustainable death spiral where people will wait until they get sick to buy insurance (due to the another provision that requires community rating and guaranteed issue, i.e. everyone pays the same and no one can be turned down), making costs skyrocket out of control.  While it would most likely hit the insurance industry's bottom line quite hard, the fear is really quite exaggerated.  For example, while Massachusetts currently has an individual mandate along with community rating and guaranteed issue, New York does the same but without the individual mandate, and yet the latter actually has lower premiums than the former.  Granted, both states have ridiculously high rates, but individual mandates don't appear to make rates any lower or make the system any more successful.   And New York's insurance industry is hardly in a death spiral.

The best solution, of course, is a single-payer system similar to Canada's.  An excellent plan can be found here, for example.  But will Congress have the intestinal fortitude to finally stand up to the greedy insurance industry and its deep-pocketed lobbyists, who will do everything they can to fight it?

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