Mistakes and Mandates

Speaking of my book score this Christmas, I noticed that Jonathan Cohn responds to this Paul Starr piece (gated) concerning his belief that the individual mandate portion of the ACA was a political mistake for limited policy benefit.
Though it should be noted that Starr understands the policy reasoning behind such a mandate, he believes a different path would have been better. Cohn recaps:

Paul suggests that, instead of imposing this requirement, the government could simply have offered everybody a choice: People could opt to refuse insurance, but only if they were willing to relinquish the benefits and protections of the new law for a fixed period of time: For example, they would not be guaranteed coverage if they had pre-existing conditions. (An alternative would be to charge people late-enrollment fees.)

Cohn describes this alternative as a ‘soft mandate,’ something similar to Parts B and D of Medicare, and perhaps something that wouldn’t be easily replicated when targeting a much younger segment of the population. Generally speaking, the young don’t anticipate  health risks in the same manner as senior citizens – if they do it at all. Yet Starr also contends that the mandate in the ACA is relatively weak – whereby the enforcement mechanism is simply raising your tax liability. Fortunately, we have an example of instituting a ‘hard mandate’ in the form of Massachusetts health care reform. Cohn again:

[…] The Massachusetts system has reduced the state’s uninsurance rate from around 10 percent to around 3 percent (or less, depending on which estimate you believe).

Paul wonders whether this example tells us much, since even the 10 percent rate was relatively low by American standards — and since the Massachusetts mandate had the enthusiastic backing of both the political and business establishments. But the fact that the uninsurance rate in Massachusetts was just 10 percent may very well prove the opposite point, since it’s likely that 10 percent consisted disproportionately of the young, healthy people who tend not to sign up for health care even when it’s available.

Cohn continues to make good points regarding the CBO and modeling forecasts for health insurance participation rates after the ACA’s implemented. I’ll stop here because I wanted to flesh out the idea that the individual mandate of the ACA was the best available policy solution at the time. Massachusetts was not only a clear and recent model for health care reform, I would also argue that it seemed logical for President Obama given his desire to act in a post-partisan world. Why would this act represent the equivalent of passing the partisan divide? Because the individual mandate was a long-standing Republican approach to health care reform. From yesterday’s WonkBlog, Ezra Klein:

[..] In 2006, in other words, the Republican Party had an alternative to Obamacare. The only problem? It was Obamacare.

Between 1990 and 2007, the reigning Republican theory of health-care reform was that instead of handing the health-care system over to the government, they would put private insurers and personal responsibility at the core of their health-care reforms. During this period, everyone from Bob Dole to Jim DeMint to the Heritage Foundation endorsed this approach. But then Democrats, looking for a compromise, endorsed those same plans. And then Republicans, rather than pocketing the policy win, ran from their own ideas.

But insofar as the Republican Party had a plan for health-care reform, the individual mandate was it. […]

I only pull this quote because it was easily accessible, but it’s a point that’s been made several times since 2009. I think few people would envision the individual mandate as it exists in the ACA as the perfect policy solution, but given the political constraints and opportunities in 2009, wasn’t it the best available policy solution?

*Side Note: I suppose I would be better served by commenting on this subject after reading the book, but I couldn’t help myself.


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