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Economics and Health Care: a Political Football

2012-06-27

This post is about the efforts of the Obama administration to institute a new health care system, which are likely to be disallowed as unconstitutional by the Supreme Court this week.  The part which is unconstitutional is mandatory coverage, that is, a mandate that everyone should carry health care insurance or face a fine.  The idea of mandatory insurance is not new, and that is the point of this post.

When Obama introduced his health care plan to Congress, his advisors were comfortable with the idea that Congress had the constitutional power to mandate that all Americans purchase (or have themselves enrolled in) some form of health care insurance.  The idea of mandatory coverage had been knocked around discussions of health care reform for some time, with no concern about Congressional power, mostly by Republican proposers.

The reason mandatory coverage (by private insurance companies and/or Medicaid) was popular with Republicans was that it appeared to be a good alternative to single-payer health care insurance administered exclusively by the Federal government.  Republicans did not and do not like the idea of single-payer insurance because, for one thing, it involves a large government program, and for another, it might cut in to the business and profits of private health care insurers.

Making the purchase of insurance mandatory would cover a big hole in the economics of health care and hold down the cost of insurance for everyone.  It’s not the most critical problem in health care today, but it is a serious problem; many personal bankruptcies are forced by the cost of uninsured health care.  Republicans, who preach personal responsibility, believe that everyone who is rational would buy health insurance coverage as soon as possible anyway.  Making this mandatory, however, would require that the government subsidize the cost of coverage for those who could not afford it.

This is not as much of a problem to Republicans as single-payer insurance would be.  Altering the system to put everyone under a single-payer “insurance” plan would also solve the problem of unpaid bills, but that might involve changes that the private health insurance business would find unsatisfactory.  The Republicans could not tolerate that any private business should be discommoded, much less run out of town.

What has happened to the idea of mandatory insurance, which was originally the Republican answer to the problem?  Unfortunately for this idea, it was adopted by a Democratic administration.  The Republican response to this adoption was a change from enthusiastic acceptance to adamant rejection.  No Republican in Congress would vote for it.  Over 250 million dollars in advertising has been devoted to selling the American people on the idea that mandatory insurance, along with all the other parts of the new health care bill, is wrong and un-American.

Republican attorneys general of a majority of American states have sued in federal court to block this new health care proposal.  The Supreme Court is about to issue a decision on the constitutionality of this proposal, and if their known proclivities hold true, the Court will find a reason to declare part or even all of the proposal unsound.

So an idea, which may or may not be fundamentally sound, is treated by Republicans as if it is only good when they propose it, not when Democrats accept it.  This type of thinking is difficult for the average person to understand.  Most people would consider an idea on its merits.

This is what we can expect from Republicans.  They hate Democrats and Democratic ideas, even if those ideas used to be Republican ideas.  There is even reason to suspect that they hate Democrats specifically because they are part black.

This also shows that the only really and truly reasonable solution to the problem of unpaid health care bills is single payer health insurance with a gradual phaseout of private health insurance companies.  Overhead will be much less, total costs will be less, and it will be much fairer to everyone.  The detailed advantages of the single payer plan will be left to another post.

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