Archive for March, 2010

A lot has been made by anti-health care reform advocates and on this blog’s comments about the Health Care mandate that are built into the system. Some people have called it fascist, some have called it communism, others have called it much, much (much) worse. But is it really a government take-over of your life?

Ezra Klein of the Washington Post spell out exactly what the mandate is, what it does  and how it will affect your life.

Click here to read the whole story. But here are some highlights:

The mandate is there to bring healthy people into the pool, which keeps average costs down and also ensures that people aren’t riding free on the system by letting society pay when they get hit by a bus.

Most people will never notice the mandate, as they get insurance through their employer and that’s good enough for the government. But of those who aren’t exempt and aren’t insured, the choice will be this: Purchase insurance or pay a small fine. In 2016, the first year the fine is fully in place, it will be $695 a year or 2.5 percent of income, whichever is higher. That makes the mandate progressive.

And what happens if you don’t buy insurance and you don’t pay the penalty? Well, not much. The law specifically says that no criminal action or liens can be imposed on people who don’t pay the fine. If this actually leads to a world in which large numbers of people don’t buy insurance and tell the IRS to stuff it, you could see that change. But for now, the penalties are low and the enforcement is non-existent.

The irony of the mandate is that it’s been presented as a terribly onerous tax on decent, hardworking people who don’t want to purchase insurance. In reality, it’s the best deal in the bill: A cynical consumer would be smart to pay the modest penalty rather than pay thousands of dollars a year for insurance. In the current system, that’s a bad idea because insurers won’t let them buy insurance if they get sick later. In the reformed system, there’s no consequence for that behavior. You could pay the penalty for five years and then buy insurance the day you felt a lump.

So that’s it. Starting in 2014, you CAN go without insurance. But why would you? However, if you don’t have a job or your employer doesn’t offer insurance and you don’t want insurance: pay the fine. But as Ezra notes, get sick, break a bone and pick up some insurance on the ride to the hospital. But the goal is to get more healthy people (usually young people) into the pool to help pay for cost for the older and people who have chronic illnesses.

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