Take the Mandate

We Americans overwhelmingly want to eliminate the use of pre-existing conditions to deny health care coverage.  At the same time, we don't want to be forced to buy health insurance when we don't want it.  Unfortunately, we can't have it both ways.  The two issues are so closely related that the first doesn't make much sense without the second.

Let's assume, for example, that I am promised both.  I can never be denied coverage (or be charged a higher premium) based on a pre-existing condition.  And, I can never be forced to acquire health coverage.  As I sit down to analyze my options, I will quickly come to the conclusion that there is no reason for me to buy much insurance now.  My only concern will be costs that happen so quickly that I cannot rush out and buy coverage I incur a cost.  Therefore, I might want to buy coverage for accidents and sudden symptoms like a heart attack or stoke.  Even in those circumstances, however, because I could acquire additional coverage a few days (or even a few hours) after the event, I would only need to be covered for a short period of time. 

Everything else, including chronic conditions like diabetes, congestive heart failure, or bronchial disease, would allow me to wait to buy coverage after I contracted the condition.  The good news would be that the policy I buy now would be very cheap.  The bad news would be that the policy that I might have to buy later would be very expensive.  Moreover, because the annual cost of managing chronic conditions varies dramatically from condition to condition, if I contract a chronic condition that can be managed inexpensively, I will be subsidizing those whose conditions require more costly treatments.  Indeed, if my condition is inexpensive enough, I might even opt out, leaving the others with even higher premiums.

Employers who provide health coverage to their employees would quickly follow suit.  They may, for example, decide to self insure for unexpected, short-term costs and buy an individual policy only after an employee has a need for longer term care. 
 
Because pre-existing condition issues are so intertwined with mandate issues, we have a limited number of choices: 

• We can keep the system we have today, where anyone can choose not to get coverage now but possibly at the cost of being unable to get affordable coverage in the future.  The problem with the current approach is that the cost of guessing wrong is only partially borne by the individual who elects not to get coverage.  Once an uncovered individual runs out of money, emergency rooms, other creditors and taxpayers pay the bills.

• We can move to a system that eliminates pre-existing conditions as a reason for denial of coverage but requires that everyone be covered.  This is the system that we already have for Medicare.  If I work, my employer and I pay a Medicare tax.  Nonpayment is not an option.  In fact, nonpayment triggers some of the harshest enforcement actions that the IRS has at its disposal.

• We can move to a hybrid system that eliminates the pre-existing condition problem but only for those who have or acquire minimum coverage today.  Those who chose not to get coverage now (and who are not eligible for subsidized coverage) will still be subject to pre-existing condition rules should they decide to join later.  Those who opt in now will not.  A hybrid approach addresses distaste for mandatory coverage, but given the incorrigible optimism of the 25 to 65 set, over time it will almost certainly morph into what we have now, with emergency rooms, creditors and taxpayers paying the freight.

The issues relating to pre-existing conditions and mandated coverage are, like many other health care issues, complex.  The tie between the two is simple.  One does not work without the other.  Therefore, anyone who eschews mandatory coverage should have the intestinal fortitude to admit that he or she finds coverage denials based on pre-existing conditions an acceptable part of our health care system.