How Many Americans Will Choose to be Uninsured Even if Insurance is Mandatory?


USA Today looks at how many folks will choose to be uninsured despite mandates to buy insurance or…pay a fine that for several years at least will be far less than the cheapest plan out there.

Under the Senate bill, people who don't buy coverage would face a maximum penalty of $95 beginning in 2014. That would jump in 2016 to $750 or 2% of their annual income up to the cost of the cheapest health plan, whichever is greater. In the House bill, violators would pay as much as 2.5% of their annual income up to the cost of the cheapest plan beginning in 2013.

When people buy health insurance on their own rather than through employers, the average cost in 2016 is projected to be $5,500 for an individual policy and $13,100 for family coverage, according to the Congressional Budget Office.

Both bills would provide a sliding scale of subsidies to individuals who earn less than $43,320 or families of four who earn less than $88,200. The bills also exempt millions of people from the mandate, including for financial hardship.

Incidentally, using 2007 figures, household income of $88,000 puts a household in the second-highest income quintile, which included households making between $60,000 and $97,000. So if in fact the government will be subsidizing people in that income bracket, it will be subsidizing upper-middle-class earners.

Anyhoo, USAT notes that when Massachusetts created its involuntary coverage mandate, the percentage of uninsured declined from 7 percent to 4 percent. It also cites Congressional Budget Office numbers on the percentage of Americans who resolutely fail to do what they are told to do by law:

• Most states have required seat belt use for about two decades, yet 18% of Americans still don't buckle up.

• Schools have required children to get immunized for chickenpox since the 1990s, but 15% don't get vaccinated.

• Nearly all states require drivers to buy car insurance, but 15% don't comply.

Whole story here.

So what percentage of Americans won't buy mandated insurance? It's not clear, though it seems a no-brainer that if the penalty is only $95, many won't, at least at first. And the non-compliants (a term with Philip K. Dickian resonance and one that I'm sure will become common parlance if and when the current miscarriage of health care reform passes) will be concentrated among the relatively young and healthy, precisely the demographic that the government wants to pull into the pool to lower costs and raise revenues. But that's OK, because we have ways of making them work, right?

Gaze upon the folks you need to convince that mandatory health insurance (not care, mind you, insurance) is, well, mandatory: