Last week, the U.S. House of Representatives passed a nearly 2,000 page health reform bill. Looking past the clear party line divide, the bill passed by a two member margin – just barely scraping by with the minimum vote the majority needed for it to now go to the U.S. Senate.
Inclusion of the public option, or government-run health care, and penalties for individuals and small businesses certainly played a role in this shocking development. It was not so much surprising though as the new addition of mandates for the purchase of health insurance. On Thursday the Senate bill drafted by Majority leader Sen. Harry Reid (D) was also released and in many respects very similar to the House bill. The choice to include a mandate in both bills requiring individuals to purchase health insurance was a poor policy choice not only because of the inevitable economic repercussions that will arise from it, but also because it challenges the very basic freedoms promised to us in our constitution. Hence the question arises, is such a policy proposal even constitutional?
The House bill stipulates that if individuals do not purchase health insurance they will be forced to pay a six percent penalty on their income. Many individuals cannot afford this penalty or simply do not want to purchase health insurance provided by the government – without the ability to tailor a plan more adept to their own needs. As it stands now, if anyone refuses to pay that penalty, there are very little civil protections for the individual.
Not purchasing health insurance could be treated directly as tax fraud, in which case, the individual has the potential to pay a $250,000 fine or face up to five years in prison. There is nothing explicitly written in the bill that says the refusal to pay the fine will be treated as tax fraud, but in the same vein there is nothing that says it won’t. The omission leads us to believe that such a refusal to pay will by default be considered tax fraud in any court of law.
The conservatives in the Senate have proposed a clause that would make it so that if the fine was not included in the individual’s yearly tax payment, it would be deducted from any tax refund received. This amendment has made little headway through the Legislature, and would still not get at the elemental question – the constitutional basis of these mandates.
The answer is that there is little constitutional basis for these mandates short of a decade long history of growing government. The trend in this century has been to expand and rationalize the true basis of the “enumerated powers” clause. When prompted for a constitutional defense to these mandates we have already seen much of our leadership dodge the question and instead continue to rally behind the arbitrary need to push for a greater government role in health care.
The arbitrary nature of their claims is furthered by the fact that these mandates would have a negligible effect on cost because so many currently uninsured people would be pushed into a one size fits all government plan. Several cost estimates stipulate that such a plan would actually raise the cost of insurance premiums instead of making them more affordable for those that need it the most.
To provide a concrete example, New York already instated mandates that bar insurance companies from denying coverage because of preexisting medical conditions or age, and the results are that premiums of the government plan have skyrocketed after their inception. As it stands in New York, there are other plans that people can chose from where they have the ability to tailor their insurance choice to meet their specific needs – such as plans that only cover hospital stays or catastrophic coverage.
The new government reform plan would require all to purchase a plan that met the necessary requirements instated by the government or pay a fine. Hence those that previously had the option to purchase health insurance at nearly half the cost would be forced into a government option where costs would exceed that of private insurance plans. So if cost increases and choice is reduced, what are the pro’s of instating mandates?
Mandating individuals to purchase health insurance may seem like a good way to ensure that healthier people buy into the system and promote a greater cost control structure, however at what cost? Instating a command and control health care system won’t simply degenerate the basic principles of freedom and choice on which our democracy is centered, it is also uncertain that it will have any real effect on the cost burden of the proposed system. Reform is always welcome, but not when the cost is our freedom.