The politics of health reform aren’t always red vs. blue. There are deep divisions within each party over the future of health policy. A case in point played out in Minnesota as 2017 turned to 2018. State Sen. Scott Jensen (R-Chaska) wrote in a Dec. 28 opinion article for the Minneapolis Star Tribune that an individual mandate reflects conservative principles if it includes individual flexibility:
“An individual mandate resonates with conservative principles of personal responsibility, and comparisons are often made to similar requirements for auto insurance. But it is crucial to realize that an individual mandate requiring insurance companies to include too many ‘essential’ benefits will likely sabotage the affordability and sustainability of such a mandate. Patients are capable of championing their own health care, and they should be allowed to choose what they want to buy. Teetotalers should not be forced to buy inpatient chemical dependency coverage, and seniors may want to invest their dollars on maladies of aging rather than prenatal care. Choice matters!”
Sen. Jensen – a physician – apparently received an earful from his Republican colleagues and other Minnesotans. Two weeks after his first article, he wrote a second commentary, acknowledging the firestorm his “mandate” plan created. “Follow-up letters and social-media responses have made it plentifully clear that the concept of any kind of ‘mandate’ is a lightning rod for folks from all political persuasions,” wrote Jensen.
So, if it’s not a mandate, what is the solution to bringing more people into the health insurance marketplace? Jensen argues for more incentives, including the ability of those buying health insurance as individuals to receive a tax deduction, while “providing basic coverage for critical care for every Minnesotan, including mental health coverage” and “preserving the right of all people to champion their own care.”
The challenge of finding a replacement for the individual mandate – both in name and in fact – is the result of the decision by Congress to repeal the requirement as part of the tax overhaul. While ending the mandate doesn’t end Obamacare, as President Trump has argued, it is a major change and just the beginning of what likely will be another tumultuous year in the marketplace for health coverage.
The individual mandate was a requirement in the Affordable Care Act – Obamacare – that requires most people to obtain health coverage that meets defined standards or pay a tax penalty. The idea is that by requiring healthy people to buy coverage, the cost of covering less healthy people is spread among more people. The plan didn’t always work as intended. Many healthy people – especially younger Americans – did not buy health insurance in spite of the penalty. And, there is evidence that some people were able to exploit the system, buying insurance only when they needed it, then dropping the coverage after receiving benefits.
Still, eliminating the individual mandate is predicted to increase both the numbers of people without insurance and premiums for everyone. The nonpartisan Congressional Budget Office estimates that in 2019, the first year of the repeal’s impact, 4 million fewer people will be covered; that number will rise to 13 million by 2027, according to CBO. Premiums are predicted to increase by about 10 percent annually over the next decade.
One observer, Paul Waldman, wrote in the Washington Post that repealing the individual mandate will increase the political pressure for government-sponsored universal coverage. He argues that the repeal will leave many low- and moderate-income people either in Medicaid (the state-federal government program for low-income people) or obtaining insurance coverage through the ACA and receiving substantial subsidies to help with premiums.
“On the whole, that’s a bad thing, since premiums will rise even more quickly and more people will be uninsured,” wrote Waldman. “But those with low incomes will be getting free or low-cost insurance courtesy of the government, which everyone else will continue to notice. We wind up with a system made up of 1) people who get coverage from the government and are happy with it; 2) people who get coverage from their employers, and like the coverage but don’t like the cost; 3) a small number of people who pay the full cost of private coverage, which is increasingly unaffordable; and 4) people who are uninsured and wish they could get on a government plan such as Medicare or Medicaid.”
Waldman argues that Republicans didn’t repeal the ACA, “but did just enough damage to it to give Democrats the opening to go much further” and win popular support for the expansion of government programs.
Avoiding the political scrum is a tall order, one that will take thoughtful, bipartisan leadership. It’s worthwhile that the conversation in Minnesota is underway with both Republicans and Democrats at the table.