The Mandate Muddle
Imagine this: It’s the summer of 2009, and President Barack Obama is about to unveil his plan for universal health care. But his health policy experts have done the math, and they’ve concluded that the plan really needs to include a requirement that everyone have health insurance — a so-called mandate.
Without a mandate, they find, the plan will fall far short of universal coverage. Worse yet, without a mandate health insurance will be much more expensive than it should be for those who do choose to buy it.
But Mr. Obama knows that if he tries to include a mandate in the plan, he’ll face a barrage of misleading attacks from conservatives who oppose universal health care in any form. And he’ll have trouble responding — because he made the very same misleading attacks on Hillary Clinton and John Edwards during the race for the Democratic nomination.
O.K., before I go any further, let’s be clear: there is a huge divide between Republicans and Democrats on health care, and the Obama plan — although weaker than the Edwards or Clinton plans — is very much on the Democratic side of that divide.
But lately Mr. Obama has been stressing his differences with his rivals by attacking their plans from the right — which means that he has been giving credence to false talking points that will be used against any Democratic health care plan a couple of years from now.
First is the claim that a mandate is unenforceable. Mr. Obama’s advisers have seized on the widely cited statistic that 15 percent of drivers are uninsured, even though insurance is legally required.
But this statistic is known to be seriously overstated — and some states have managed to get the number of uninsured drivers down to as little as 2 percent. Besides, while the enforcement of car insurance mandates isn’t perfect, it does greatly increase the number of insured drivers.
Anyway, why talk about car insurance rather than looking at direct evidence on how health care mandates perform? Other countries — notably Switzerland and the Netherlands — already have such mandates. And guess what? They work.
The second false claim is that people won’t be able to afford the insurance they’re required to have — a claim usually supported with data about how expensive insurance is. But all the Democratic plans include subsidies to lower-income families to help them pay for insurance, plus a promise to increase the subsidies if they prove insufficient.
In fact, the Edwards and Clinton plans contain more money for such subsidies than the Obama plan. If low-income families find insurance unaffordable under these plans, they’ll find it even less affordable under the Obama plan.
By the way, the limitations of the Massachusetts plan to cover all the state’s uninsured — which is actually doing much better than most reports suggest — come not from the difficulty of enforcing mandates, but from the fact that the state hasn’t yet allocated enough money for subsidies.
Finally, Mr. Obama is storing up trouble for health reformers by suggesting that there is something nasty about plans that “force every American to buy health care.”
Look, the point of a mandate isn’t to dictate how people should live their lives — it’s to prevent some people from gaming the system. Under the Obama plan, healthy people could choose not to buy insurance, then sign up for it if they developed health problems later. This would lead to higher premiums for everyone else. It would reward the irresponsible, while punishing those who did the right thing and bought insurance while they were healthy.
Here’s an analogy. Suppose someone proposed making the Medicare payroll tax optional: you could choose not to pay the tax during your working years if you didn’t think you’d actually need Medicare when you got older — except that you could change your mind and opt back in if you started to develop health problems.
Can we all agree that this would fatally undermine Medicare’s finances? Yet Mr. Obama is proposing basically the same rules for his allegedly universal health care plan.
So how much does all this matter?
Mr. Obama’s health plan is weaker than those of his Democratic rivals, but it’s infinitely superior to, say, what Rudy Giuliani has been proposing. My main concern right now is with Mr. Obama’s rhetoric: by echoing the talking points of those who oppose any form of universal health care, he’s making the task of any future president who tries to deliver universal care considerably more difficult.
I’d add, however, a further concern: the debate over mandates has reinforced the uncomfortable sense among some health reformers that Mr. Obama just isn’t that serious about achieving universal care — that he introduced a plan because he had to, but that every time there’s a hard choice to be made he comes down on the side of doing less.