Barack Obama

He Loves the Mandate, He Loves It Not.

The Obama administration's individual mandate flip-flops.

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There's an old game played by love-struck teenagers trying to figure out what the object of their affection thinks of them. Take a flower and pull the petals off one-by-one. For each petal, alternate between saying "she loves me" and "she loves me not." Whichever refrains corresponds with the final petal supposedly reveals the truth.

Those attempting to make sense of President Barack Obama's record on the individual mandate—a provision in last year's health care overhaul that will require most Americans to either purchase health insurance or pay a federal fine—might try a similar exercise. "He loves the mandate. He loves it not." But there's no need to pull the final petal to find out the truth; they're both correct.

On the campaign trail, soon-to-be-President Barack Obama warned that an individual mandate to purchase health insurance was an obviously foolish idea. "If a mandate was the solution, we could try that to solve homelessness by mandating everybody buy a house," he quipped. He ran TV ads attacking his Democratic primary opponent, Hillary Clinton, for supporting a mandate, and even declared that in Massachusetts, the only state that already had such a requirement on the books, the health insurance mandate had already made some workers "worse off." 

That didn't last long. By June 2009, less than six months after taking office, Obama said he had concluded that a mandate was necessary. In March 2010 he signed into law a massive health care overhaul with just such a mandate. Since then, his administration has not only vigorously defended the law in court, it has argued repeatedly that the mandate is absolutely "essential" to ensuring that the legislation functions properly.

It's not the only instance in which the president has tried to have it both ways on the mandate. In September, 2009, Obama was asked whether he believed the individual mandate constituted a tax. His response was unequivocal: "I absolutely reject that notion." Worried that the public would perceive the mandate as a tax anyway, the law was scrubbed of any mention of the mandate being a tax before it was signed into law.

But in defending the law in court, his administration absolutely accepted the notion that the president had once absolutely rejected. In July, 2010, The New York Times reported that the White House had come to believe that the idea that the mandate constituted a tax was "a linchpin of their legal case in defense of the health care overhaul and its individual mandate."

The ensuing rhetorical backtracking was flagrant enough that when responding to the White House's motion to dismiss the case, Judge Roger Vinson, the federal judge overseeing a multistate challenge to the law's constitutionality, scolded the administration in its arguments about the mandate:

Congress should not be permitted to secure and cast politically difficult votes on controversial legislation by deliberately calling something one thing, after which the defenders of that legislation take an "Alice-in-Wonderland" tack and argue in court that Congress really meant something else entirely.

Of course, officially the administration argues that only the penalty for non-purchase is a tax. But that doesn't match up to the original understanding of the mandate. When economist Mark Pauly first proposed the mandate in 1991, the insurance premiums paid under the mandate were considered to be taxes. As Pauly explained in an interview in The Washington Post, "The way it was viewed by the Congressional Budget Office in 1994 was, effectively, as a tax. You either paid the tax and got insurance that way or went and got it another way."

It's not an unreasonable idea: There's little functional difference between the government collecting a tax and then disbursing the revenues to insurers and the government forcing individuals to pay the same funds directly to insurers.

But as HillaryCare backers discovered, that conception of the mandate caused the official price tag of the law to skyrocket. In 1994, the CBO scored all premiums paid as taxes, driving up the cost and contributing to the proposal's eventual failure. 

Last year's health care was carefully structured to avoid a similar scoring problem. But again, the administration slipped up in court when lawyer Ian Gershengorn described health insurance as a revenue-raising "financing mechanism"—essentially buying into the original conception of the mandate's federally required premiums as a way for the government to collect revenue to pay for a service, a practice otherwise known as taxation. 

Obama's early instincts about the mandate were right: He argued that it was unduly punitive, that it made those who paid the penalty worse off, and—most importantly—that it failed to solve the real problems with the American health care system. "I believe the problem is not that folks are trying to avoid getting health care. The problem is they can't afford it," he said. If only he'd listened to himself.

Peter Suderman is an associate editor at Reason magazine and a 2010 Robert Novak journalism fellow. 

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  1. On the campaign trail, soon-to-be-President Barack Obama warned that an individual mandate to purchase health insurance was an obviously foolish idea.

    But, Peter, can’t you see? It was politically expedient to say so back then.

    “When in doubt, say what’s expedient.”
    Old Statist proverb.

    1. What will be the politically expedient thing to say next year?

      1. It’s Bush’s fault!

      2. The economy is still recovering. Don’t swap horses mid-stream.

        Re-elect BO.

    2. I think a lot of his followers see that as a feature and not a bug.

      It’s much the same as Dubya’s Republican followers way back when…

      And don’t think that the next Republican joker in the White House won’t pull the same stunt. “Obama did it when he was in White House, and you Progressives didn’t say a thing!”

      And they’ll be right.

      …on that point, anyway.

      1. Mitt Romney agrees.

        1. If I were alive, shrike, I would let you stroke my beard.

        2. Fuck that statist fuck Romney.

          1. I agree…even though people might not agree with RON PAUL…he is the ONLY candidate that speaks TRUTH…

            REPUBLICANS need to wake up and support HIM…as well as INDEP and “non-dumbed” down DEMs

    3. Viejo

      Have you thought about collecting and posting the “Old Statist proverbs,” as RC Dean has done for his Iron Laws?

      … Hobbit

  2. “Congress should not be permitted to secure and cast politically difficult votes on controversial legislation by deliberately calling something one thing, after which the defenders of that legislation take an Alice-in-Wonderland’ tack and argue in court that Congress really meant something else entirely.”

    But, Judge… That is what they do.

  3. Haven’t you heard? Lawyers SUCK. And government lawyers? Are you kidding? Fucking Shop Vacs, they suck so bad.

    I’m a lawyer; I know this.

  4. Would someone elaborate on the game rules a bit.

    1. That does it, Ice Nine: You’re on The List.

      1. So, this means you love me not?

        1. She loves you, but needs to have a body cavity search done on you first.

          1. S’long as it’s not the other way around, I’m down.

  5. Obama doesn’t flip flop, he lies. Of course he loves the mandate, he’s a Marxist, what did you expect? What is this? The Huffington Post?

    Seriously, for a libertarian site there seems to be little hate towards Marxism. Obama like Pigliosi believe in BIG DADDY GOVERNMENT as the cute of all evils.

    Read “Dreams FROM my father”, an Obama book written by der fuhrer himself, and you’ll see how his daddy was an evil socialist revolutionary… Well, Obama has the same dreams, but he’s just so suave, so cute, so wellspoken, so deliciously black, so Haaaavad, so sexy, and so talented that is no surprising reason.com is giving him a break.

    Tell me, people, where are the articles he wrote when he was editor of the Haaavaaad Law Review? Where are his grades? The man has more secrets than Area51.

    1. You’re cute, like a badly drawn caricature of a real libertarian.

    2. You need to become more proficient at wiping your ass.

    3. You have to pardon Suderman, he has a wife that won’t tolerate outright Obama bashing.

    4. Seriously, for a libertarian site there seems to be little hate towards Marxism.

      A) You’re new here, huh?
      B) Drink!

    5. Obama the “Marxist” has pushed the S&P 500 up close to 90% while Bushy-boy led it into a hellhole for eight years.

      And who wrote the $600 checks to everyone – the Bushpig – Obama has not.

      Keep on listening to AM Redneck radio – Fat Rush needs someone to listen to his smarmy lies.

      1. I’d be wary of governing based on how wells the stock market performs.

        1. Of course.

          A two year time frame (09-10)is kind of short even though policy led directly to the gains.

          Eight years of failure is kind of difficult to evade though.

          Sorry, I am a capitalist like Buffett et. al. Bush 41 and Bush 43 need to permanently hide and never speak again.

          1. I am a capitalist

            Yes, a capitalist who thinks the government can make the stock market perform better.

            Riiiiiight….

            1. Weather is not climate, remember. Go back to your province.

          2. shrike|2.2.11 @ 6:22PM|#
            “policy led directly to the gains.”
            Unproven bullshit. I’ll bet you have charts all over showing ‘inverted Ws’ and ‘sideways Zs’.

            “Sorry, I am a capitalist like Buffett et. al.”
            Of course you are, minus, oh, $47B or so.

          3. Sorry, I am a capitalist like Buffett et. al.

            So you’re a hypocrite and a graverobber? Good to know.

          4. “I am a sorry capitalist”

            Much better. Brings out your true character, shrike.

            Oh, and… no charge.

          5. Sorry, I am a capitalist like Buffett Bernanke, Pinochet, Franco et. al.

            FIFY fascist douche.

      2. Shriek, that post says 5:45. Isn’t this a little early to be into your forth scotch?

        1. “fourth” – but in any case I am only on my second.

          I am into Cragganmore this week.

      3. Re: shrike,

        Obama the “Marxist” has pushed the S&P 500 up close to 90% while Bushy-boy led it into a hellhole for eight years.

        World, meet another fool who thinks an inflationary boom is akin to good economic planning.

        Keep thinking what way, shrike. Let me tell you, my gold and food are guarded by my two very good friends: Smith, and Wesson. I will be laughing at your face when you come a-beggin’.

        1. So its “inflation” – yet the CPI rose only 1% in 2010?

          Spoken like a true goldbug – see you at $700 gold this summer.

          1. Re: Shrike,

            So its “inflation” – yet the CPI rose only 1% in 2010?

            World – meet again the same fool that thinks a government economic number is to be trusted.

            Spoken like a true goldbug – see you at $700 gold this summer.

            Sure, fool.

            1. Yep, OM. All data that refutes your views is just part of the vast liberal conspiracy.

              You really got us pegged, man.

              1. I guess the sharp increase in commodities hasn’t really made it on your radar.

                1. That was in reply to Chad, who seems to believe that if he’s not paying more than $29.99/month for his internet porn subscription, there’s no inflation.

                  1. Who the fuck still pays for porn?

              2. Does your wife know about your Obama man-crush, Chad?

          2. So things like food and fuel don’t count, huh?

            http://www.market-ticker.org/a…..st=2312106

            And let’s not forget import and export prices:

            http://www.market-ticker.org/a…..st=2354305

            Housing has gone down, but that’s mainly because Bernanke and Obama’s attempt to get them bubblicious again failed.

            1. Sure they count but they are down as well.

              And I will never, ever click on a Denninger link again. He has been 100% wrong for over two years.

              1. Sure they count but they are down as well.

                I’d really love to see your evidence.

              2. And I will never, ever click on a Denninger link again. He has been 100% wrong for over two years.

                100%? Please–his biggest problem is that he expects institutions to follow the rule of law. His contention that we can’t balance our budget without hitting the Big Five is the same one YOU took on this board recently.

                shrike|1.24.11 @ 5:17PM|#

                If your first words are not Medicare, SS or defense you are a fucking pussy.

                I guess both of you are 100% wrong, by your standard.

          3. And $6.00 gas, at least in the higher gas tax states. Suck on that.

            1. More importantly, you’re not going to find many Bush defenders on this site, go raise your flag at the National Review. And after the crash in the Dow and S&P, there was going to be a correction regardless of who won the election. But wherever the S&P stands now, unemployment is still ~9.5% and our national fiscal situation is even more tenuous. So yeah, Barry’s doing great.

              1. “And after the crash in the Dow and S&P, there was going to be a correction regardless of who won the election” – well said.

          4. Shrek,

            The CPI is a propaganda number. They exclude whatever they have to exclude to make it sound good, like the prices of food and fuel.

            It’s rather like the way they cook the books on the unemployment figures.

            -jcr

      4. How do you like all those OBAMA-PHONES (free for the POOR), WELFARE, UNEMPLOYMENT INSURANCE 99 WEEKS, FOOD STAMPS, UNION EXEMPTIONS for HEALTHCARE, backdoor BAILOUTS for BANKS using FANNIE/FREDDIE????

        PLEASE DO TELL

      5. The difference between giving a citizen $600 and passing a stimulus package is that the citizen helps the economy more with those $600 than the government does by funding the NEA or building a Teapot museum or a $330,000 outhouse in a national park.

        As for the S&P 500, please, everyone knows that Wall Street isn’t a good economic indicator, why not look at unemployment, national debt, inflation, etc, etc, etc? Jerk.

  6. “”I believe the problem is not that folks are trying to avoid getting health care. The problem is they can’t afford it,” he said. If only he’d listened to himself.”

    A bit too dismissive of the moral hazard in play. I suspect most versions of functional healthcare reform would include a way to clear up the people who do not save, do not buy insurance, but still use services. Call it a mandate, call it a tax hike that goes into a welfare program, whatever, a differential incentive needs to be in play between people who choose to have insurance and people who choose not to. The market outcome of people not getting treatment if they don’t pay anything would solve this, but that’s not where we are.

    1. Why not just treat health insurance like home and car insurance? If your home burns down or your car is stolen, and you don’t have insurance to cover it, does the government require hotels to take you in and bill you later, or planes, trains, and automobiles to transport you now and bill you later?

      You are only mandated to have car insurance if you drive on public roads, and only banks require you to have home insurance while you have their mortgage. Why should health insurance be any different? Maybe employers would require you have some. Maybe the mortgage holder would. But it’s none of the government’s business. If my employer didn’t make it free, I’d sure as shit buy my own. I’ve done it while self-employed. Most people would.

      As for the horror of uninsured people dying, they can also die from being homeless after their house burns down, or from riding a more dangerous bicycle to work if they can’t afford car insurance (or the car itself). Boo hoo.

      1. The car-insurance issue is a non-issue because, in order for liberals to be consistent, *EVERYONE* would have to buy car insurance – even quadriplegics and the blind.

        I dare any fucking liberal to defend that idea.

        1. Oh, and everyone would also have to buy motorcycle, homeowners, and watercraft insurance, just to be even more “fair”.

          1. And full collision, no deductible plans. Because those liability only, or high deductible plans “don’t count” as insurance.

        2. >even quadriplegics and the blind.

          …and children who are too young to drive.

          -jcr

        3. No, we only require those who could get sick to get insurance, just like only those who can get into car accidents.

          I have no problem with anyone who cannot get sick not getting health insurance.

          Signed, a progressive

          1. I can’t get colon cancer, so I can get that coverage taken out of my plan, right?

            1. I have no problem with that.

              Luckily you can purchase any plan you can negotiate with a private insurer and that is fine – i’m sure private companies competing will offer this, right? You know, perfect markets and all that? Don’t insure body parts you don’t have. Won’t bother me one bit.

              Self insure for all i care. Set up your own company, pay your own premiums, whatever you want. See, no one is FORCING you to BUY coverage – just provide it to yourself in one way or another. Ask your neighbor to cover you. Ask your employer. Whatever you want.

              We won’t make you get maternity care either.

              Glad that’s settled.

              1. You really do have no clue about the current state of health insurance in this country do you?

    2. What RC dean said, but I’d like a proposal to prevent insurers from dropping customers after they get sick – IF they were fully insured at the time they got sick. I’m not talking about pre-existing conditions, I’m talking about people who lose their job, or want to switch insuerers, but have some chronic illness that would be considered a pre-existing condition for the NEXT insurer.

      If you have a chronic condition, or something requiring long-term treatment, then your insurance policy should continue cover it as long as it was reported before you left the company.

      I realize that isn’t IN the insurance contract, but IMO that’s an artifact of our screwed up employer-based system. Since the employer chooses the contract, not the employee, the insuer has no reason to write any clause covering long-term care after the patient leaves employment into the contract. In any other insurance market, the insurer would be responsible for the full cost of a claim if it was made while the insurance was paid up.

      You could easily get 90% of the people who currently have pre-existing conditions coverage if you held the former insurer responsible. And it would do so without introducing the perverse effects of the exclusion on pre-existing conditions into the market.

      1. I disagree with this Hazel. Just because an employer offers coverage, it is not incumbent upon the employee to accept the coverage. They should be able to shop around. Also, it is not incumbent upon a new insurer to pay for an existing condition.

        That would be like me wrecking my car and I take it to body shop where the work was mediocre but adequate. The insurer pays for the work. I fire my insurance company for raising my premiums for the wreck and refusing to pay for a better bodyman, and expecting the prospective new insurer to make my wrecked car brand new AND charge me the pre-accident rate, much less buy me a new car.

        Also, the employee has the choice of finding a new employer; people DO often consider benefits before the nature of the job. Exhibit A: public sector workers.

        1. That is true, but as you’re probably aware, tax incentives favor accepting the employer based insurance. If you receive cash instead, you will have to pay taxes on it, and cannot deduct health insurance the way your employer can.

          Your analogy is off. Think of it like this: I am fully paid up for my auto insurance. I get into an accident through no fault of my own – because of an icy road condition. The auto insurance company pays for some mediocre repairs. I switch insurance companies. During inspection, my new insurance company discovers some unrepaired damage from the accident.
          I suggest that the OLD auto insurance company pay for the unrepaired damage. NOT the new company. Even if I did not discover the problem until after I stopped paying premiums to them.

          Now, if car insurance worked like the current health insurance system, it would go more like: The repairs take more than a year because you have a very complicated car with a lot of hard to find parts. The insurance company immediately raises your premiums, despite you not being at fault and having been fully paid up at the time of the accident. They then refuse to pay for all of the repairs unless you keep paying the newly inflated premium prices. During this time, you are unable to switch insurance companies because nobody is going to insure a car with unrepaired damage.

          ObamaCare goes like this:
          We force other insurance companies to insure you, even though you have unrepaired damage. Since nobody will buy car insurance until after an accident, we’ll force everyone to buy comprhensive coverage for their car.

          1. Essentially, you want insurance companies to be treated like a divorcee paying alimony.

            1. More like child support.
              An insurance contract is supposed to be designed to pay for your future healthcare expenses, should anything happen to you. If that thing happens to take years to fix or requires lifetime treatment, I don’t see why the insurance company should demand you keep paying premiums – at inflated prices – to cover the cost of your own treatment.

              1. I would stick with alimony. IANAL, but alimony is like herpes, regardless of the means of the spouse (woman divorces schlep, woman gets alimony, woman gets remarried to fat, bald douche. Schlep still pays alimony). Kids eventually grow up and (ideally) become self-sufficient (though how a 26 y/o in good health qualifies as a child, yet legally an adult in every other way. Yes, that provision frosts me to no end).

                But, I am probably just being pedantic and certainly no actuary. Your points are sound and fits the definition of true insurance.

      2. I disagree with this Hazel. Just because an employer offers coverage, it is not incumbent upon the employee to accept the coverage. The employee should be able to shop around. Taxing employer based coverage as income would have gone a long way towards this, while refraining from taxing the employer for offering coverage. Also, it is not incumbent upon a new insurer to pay for an existing condition.

        That would be like me wrecking my car and I take it to body shop where the work was mediocre but adequate. The insurer pays for the work. I fire my insurance company for raising my premiums for the wreck and refusing to pay for a better bodyman, and expecting the prospective new insurer to make my wrecked car brand new AND charge me the pre-accident rate, much less buy me a new car.

        Also, the employee has the choice of finding a new employer; people DO often consider benefits before the nature of the job. Exhibit A: public sector workers.

        1. Sorry for the double post.

        2. You have the right to refuse the insurance coverage provided by your employer, but I suspect that many (like my company) wouldn’t reimburse you the cost. Reason being, they also realize that you would just take the cash when healthy and take the insurance when older or in need, leaving them an adverse selection problem and higher rates.

      3. This provision you want is already there. It’s called contract law.

        The horror stories of rescission are overblown. The rescission issue you are concerned about only happens if someone applied for the insurance and lied on the application.

        1. Also, IIANM, HIPPA was supposed alleviate this business of making insurance policies portable. Instead, it turned into a regulatory boondoggle enriching government with fines, making personal health information easily available to everyone but the patient, and breaking many a window by bloating labor needs to process even more redundant paperwork related to claims.

        2. I’m not talking about recission.
          I’m talking about people who, for whatever reason, lose their insurance, yet have a chronic condition that was reported to their original insurer when it started.

          The individual was fully paid up at the time the condition started, but now cannot change insurance companies, change jobs (if they have employer-based insurance), or stop paying premiums, regardless of whether their insurer raises them or not.

          If they did, they would be unable to obtain new insurance, since the new insurer isn’t going to want to pay for the chronic condition, or will charge so much, that it becomes too costly for the individual to do it.

          But this defeats the purpose of having insurance. You buy insurance before you get sick so as to avoid the calamity of future medical expenses.

          If you’re fully paid up at the time your chronic condition begins, you should be fully covered for the duration of it. It shouldn’t matter that those expenses are spread out over many years or occur all in one lump.

          The current practice of withdrawing coverage as soon as the premiums stop coming in goes against this basic bargain. It means that you are tied to the original insurance company, and have no negotiating power because no other company will take you.

          I think that in a normal market, this is how health insurance would work – the original insuance company would continue to pay for your chonic condition as long as it’s continuing, or else pay out a lump sum to cover your expected future expenses. IMO, the only reason this isn’t in the contract is because the market is biased towards the employer-based plans, which entail essentially not giving a fuck what happens to you as soon as you leave the company.

          1. “But this defeats the purpose of having insurance. You buy insurance before you get sick so as to avoid the calamity of future medical expenses.

            If you’re fully paid up at the time your chronic condition begins, you should be fully covered for the duration of it. It shouldn’t matter that those expenses are spread out over many years or occur all in one lump.

            I understand what you’re saying. …and technically, I think I’m close to fitting into the category you’re talking about.

            …what about people who are misdiagnosed with temporary conditions, who subsequently lose their insurance, and then the condition turns out to be chronic?

            On the other hand, health insurance is a little different from calamity insurance in one respect–we may never get into a car accident, but we definitely will get sick.

            Maybe some of Bailey’s buddies will find the cure for old age before it happens to us, but short of that or Jesus coming back all of sudden, we’re all will definitely need health insurance. No doubt.

            I run four miles every other day. I swim regularly. I lift weights. I eat way better than right. …but someday, I’m gonna get old; I’m gonna get sick; I’m gonna use my health insurance; and then I’m gonna die!

            And then the rest of you are all gonna go spinning your way around the sun without me–you coldhearted bastards!

            Anyway, point is that with health insurance, they’re underwriting a policy that will definitely be used at some point. And if you require the insurance company to underwrite a policy that requires a claim on day one?

            You should have to pay through the nose for that.

            1. “On the other hand, health insurance is a little different from calamity insurance in one respect–we may never get into a car accident, but we definitely will get sick.”

              Without comment on the rest of your post, this is not shown.
              We will all die, but we may not be sick before we do so.

              1. Okay, assuming you don’t die of old age? …and you don’t die by some horrifying accident?

                Assuming you somehow get obliterated by a meteor or something? So bad that nobody would bother calling an ambulance?

                Assuming you have an advance directive in your pocket when you code, and somebody bothers to read it before doing CPR?

                …or you’re eaten alive and completely by sharks?

                Then you might have a point. …if you assume you’ll never need healthcare even before you contract whatever kills you.

                Otherwise? The rest of us almost certainly will need some healthcare at some point in our lives.

                I hope the point is getting across that the solution isn’t about reforming the insurance industry. It’s letting competition and free choice bring prices down like they do with every other industry.

                We need a private option. Everything else solves 5% of the problem–and leaves 95% of it unsolved. We need to start phasing out Medicare and Medicaid. We can start by means testing it, and then start phasing it out from there.

                It’s just a welfare program. Nothing better. It’s not a lock box. It’s not a retirement strategy. It’s a welfare program that we’re all forced to participate in. They’re trying to make welfare queens out of all of us–with predictable results–and reforming the insurance industry won’t even address 5% of the problem.

                1. Ken – your last three paragraphs were spot on!

            2. …what about people who are misdiagnosed with temporary conditions, who subsequently lose their insurance, and then the condition turns out to be chronic?

              My feeling is that the original insurance company should have some means of estimating your risk of it becoming chronic and should pay out accordingly. If you switch insurance companies they can pay them a negotiated lump sum. Or if yhey drop your insurance, they pay you the sum, and then you’re obliged to pay higher premiums in accordance with your increased risk.

            3. we may never get into a car accident, but we definitely will get sick.

              Not really. You could die suddenly in an accident or have a heart attack, and basically wind up with close to zero expenses. If you’re declared dead before you get to the hospital, how much is your insurance really going to pay out?

              1. That possibility is remote.

                The chances of you never needing healthcare–and then dying in such a way that doesn’t require healthcare is remote.

          2. Hazel,

            This could be handled by insurance riders.

            For example, life insurance companies routinely offer a disability rider that will pay the premiums should the insured become disabled. People are free to pay a few dollars extra for that coverage or to forego it as they desire.

            Hold insurance companies liable for their contractual obligations and relax the cosntrictions on supply caused by havign the Teamsters control how many truck and driver licenses are issue- er the AMA control the number of medical and hospital licenses are allowed, and stop subsidizing care, and doctors would drop their prices to an affordable market clearing one again.

            1. We already have a system to hold insurance companies responsible for their contracts–it’s called “court”.

              The problem isn’t the way insurance companies underwrite policies, and changing the way we regulate insurance companies isn’t going to do a thing.

              The 800 lbs. gorilla in the room is Medicare and Medicaid. You can’t give those people medical care below cost and not expect it to inflate the cost of care for people outside the program.

              It’s the sources and uses analysis.

              If you’re using a disproportionate amount of healthcare resources on people who aren’t paying enough to cover the cost of care, then those resources must be paid for by other people!

              It’s like what student loans do to the cost of attending college–only much worse! Medicare and Medicaid not only inflate the cost of care by encouraging people to use services they might not use if they had to pay for them themselves–AND the government’s driving up the cost of care to everyone outside of Medicare and Medicaid by underpaying for services!

              Imagine if college was like this… What if 2/3 of the people who went to college, went on a government program that only paid 25% of the tuition–and gave them the rest of it free!

              …what would that do to the price of tuition for the other 1/3 of the people who were working their way through school or taking out a loan?

              The solution to that problem isn’t to go after the loan administrators. …and it isn’t to force employers to pay their employees more either.

              If you do anything but move away from a system that doesn’t pay the school the full cost of tuition, you’re just putting a band-aid on a bullet wound.

              1. If 3/4 of the healthcare in this country is consumed by people on Medicare and Medicaid, and Medicare and Medicaid only pay for half the costs of that care (and their patients don’t have to pay for any more of it than that)…

                Should it surprise the other 1/4th of the country that they have to pay 3 or 4 times as much for healthcare?

                If I could wave a magic mind and make everybody realize one thing? It’d be that just because you don’t pay your bill because you’re on Medicaid or Medicare? Doesn’t mean the government pays.

                They don’t. They pay a fraction of the bill–and the rest is forgiven.

                …at least as far as the government and Medicare and Medicaid are concerned. In reality? Those costs are shifted to private insurance patients and people who don’t have insurance and pay cash.

                That’s why x-rays cost $200. Most of that? You’re not paying for own x-rays! You’re paying for everybody else who by government decree doesn’t have to pay!

                …oh, and it works out great for the government too, because when we blame people for the high charges? We blame the insurance companies!

                1. We ought to incentivize people to use insurance as real insurance instead of a healthcare plan. We should be paying for routine care and using insurance for calamity. And we need to further promote HSA’s so people can save for their own future medical needs. And I agree, quit incentivizing the employer-based care system or healthcare will never be portable. Currently insurance companies only need to convince the employers that they are best for the bottom line. If the employee were responsible, insurance companies would compete to provide better coverage, not just lower cost.

            2. Yeah, maybe as an alternative to ObamaCare, we could require employer-based insurance to include those riders. Leave them optional for people in the individual market, but make sure they are included if the employer is paying.

              I’m not saying this is an ideal solution. But it’s kind of a correction to the perverse situation created by employment-based system.

              Obviously the ideal way to go would be to eliminate employment-based insurance. Since that doesn’t seem likely to happen soon, this would be an easy correction that would fix the “job lock” problem.

              I’d even be ok with making it retroactive and forcing the insurers to pick up patients they dropped due to loss of employment.

              1. Again, I don’t think that’s even addressing the problem.

                The problem isn’t that people don’t get insurance. The solution isn’t giving people more insurance.

                The problem is that government interference is pumping up the price of care. The solution is to make the government stop pumping up the price of care!

                If the cost of care dropped by 2/3rds, a hell of a lot more people would be able to afford quality care–whether they had insurance or not.

                The price of insurance isn’t the problem! The price of care is the problem. It’s being artificially inflated for people who aren’t on Medicare and Medicaid–by more than two to three times.

                That needs to stop. If the solution doesn’t address Medicare and Medicaid system wide underpayment or it doesn’t address restricting people on the program through means testing (any way they want to do it), then it doesn’t even address the real problem.

                The problem is the price of care to those of us who aren’t on Medicare and Medicaid. The insurance industry is a red herring.

                1. The price of insurance is a problem, largely related to third-party payment systems.

                  However, the issue of job lock and people who end up with “pre-existing” conditions, because some insurers dumped them after they got sick is an entirely separate issue.
                  It’s also a completely valid point that the proponents of healthcare reform often bring up. It IS grotesquely unfair that someone should lose their insurance and be unable to obtain new insurance simply because they lost their job, or were otherwise unable to keep on paying premiums (at higher and higher rates) after getting ill. If they were paid up BEFORE they got sick, they should be covered.

                  1. The only thing unfair is forcing people into “agreements” against their will.

                    Insurance companies most definitely being “people” too.

                    1. Well, IMO, this is really the only kind of insurance contract that makes sense, and it would be the normal condition if we didn’t have employer-based insurance.

                      If your employer is the one who negotiates and signs the agreement, neither they, nor the insurance company, have any reason to care what happens to you if you get too sick to work or leave the company. The insurers can always sell a cheaper policy to your employer by writing the terms so that they can get rid of you if you leave the company. It’s always in the insuers interest to have the option to get out of an insurance contract at a future date after you’ve paid them a lot in premiums – whether you are sick or not at that point. This isn’t an option available to an insurer in other markets. You’re life insurance company can just dump you the day you turn 70, and walk away with 40 years worth of premiums.

                      Also it’s in your employers interest to spend less on health insurance. Only the employee has any say in the matter, and it’s not exactly a competitive market when you’re talking about shopping employers for health benefits.

                    2. Er, I should say, the life insurance company CAN’T cancel it’s insurance contract the day you hit 70, after you’ve been paying them your whole life. No life insurance contract is written to allow it.

                      The only reason this happens in healthcare is due to the employer-based system. One you quit your job or get laid off, the insurer gets out of the contract. It’s perverse.

                2. I agree with this as well. Same concept as rent control or the amazing liberal “affordable housing.” You charge under market value to some people for a good leaving the rest to make up the difference. Then demand increases for those getting the lower prices, causing a shortage and further driving up the price for the poor schmucks picking up the tab.

          3. Quit making sense, it’s confusing on Internet message boards.

    3. Re: JasonL,

      a differential incentive needs to be in play between people who choose to have insurance and people who choose not to.

      Yes – it’s called “No money, no service.”

  7. I suspect most versions of functional healthcare reform would include a way to clear up the people who do not save, do not buy insurance, but still use services.

    Easily done, and uses the government to do what it does best: take things from people.

    All unpaid bills for healthcare delivered to people who are uninsured and do not pay may be submitted to the government for payment. The government pays on behalf of the debtor, and goes after the debtor for the amount paid using the full panoply of tax collection powers.

    Health care cost-shifting (partially) solved. Incentive to make arrangements to pay for your own health care, in place (in spades).

    What’s not to like?

  8. Oh, and alt-text:

    Man, that burrito is really repeating on me.

    1. “I shouldn’t have had the fish…”

    2. “How to hold in a bong hit”

    3. “Damn ‘Chelle, yo poon is stank!”

  9. a differential incentive needs to be in play between people who choose to have insurance and people who choose not to.

    See, there it is again, that weird thinking that makes insurance some necessary part of health care.

  10. Is it just me, or do other people find that Obama reminds them of Richard Nixon?

    1. Jimmy Carter with a bit more backbone.

    2. Dick Nixon was professional politician and a first-rate criminal.

      Obama is a piker.

      1. Dick Nixon was professional politician and a first-rate criminal.

        And this differentiates him from most of the Presidents of the 20th century…how?

    3. I am somewhat Nixonian, with more panache. “Ralliez-vous ? mon panache blanc, suckeurs!”

  11. There’s another doublespeak on the mandate.

    Democrats like to claim that it’s a way for forcing people to plan for their future healthcare expenses. But at the same time they insist it’s needed to enforce guarenteed issue and community rating. Which force low-risk individuals to pay for OTHER people’s healthcare.

    They can’t have it both ways. EITHER, mandatory insurance is about paying for your own future treatment, OR it’s about paying for the treatment of sicker, riskier people. If it was the former, you could have the insurance regs without the mandate and vice versa. But they know you can’t.

    1. There is even more double-speak in there, Hazel. Even with your Either/Or scenario, when the mandate clamps down, harder than a French toothless whore gumming a john, lifestyle enforcements to keep costs down, not to mention Krugman’s touting attrition of the most expensive patients (read: old people, heroic measures employed with patients with no hope of recovery, and care based on the likelihood of future economic viability). Even the mandate alone will not restrict costs without prohibition of whatever “government insurance” deems unhealthy.

  12. So you’re saying he’s a total whore who’ll say whatever he thinks will help him politically? Impossible!

  13. Doublespeak you say?

  14. Doublespeak you say?

  15. I heard that in the decision the judge quoted Obama from the campaign trail.

  16. First, the term “insurance” should not be used in connection with health care. Insurance is when people pool their resources to spread the cost of an individual’s *unexpected* misfortune. You don’t expect to be in an auto accident, but you know they can happen sometimes, so you join with others to spread the costs involved. Car insurance doesn’t pay for routine maintenance like oil changes and replacing the brake pads. But our health care plans do the equivalent. An annual visit to a doctor for a “check-up” is covered. Health care plans even stress the value of preventative care. The insurance metaphor doesn’t work. Can we please not use the word “insurance” to describe health care plans?
    Second, although I am retired and collecting both “Social Security” and Medicare benefits, I would be in favor of their repeal. That would leave me out in the cold, though, because my dependent wife is a diabetic, diagnosed while I was under my former employer’s health care plan. That plan didn’t have an extra-cost option to continue coverage after a switch to a different supplier, and a search by an agent found no one who would now cover my wife, because of her pre-existing condition. So I’m stuck paying $12,000/yr. premiums for my wife’s health care and my Medicare supplement, under my former employer’s plan.
    In spite of all this, yes, we should remove the tax incentives for employer-provided health care plans. Even though they are “private,” they’re part of the problem, too.

    CB.

    1. It’s not about pooling risk with others. It’s about exchanging one’s own individual future risk of loss, at an uncertain date in the future, for a smaller guarenteed loss, at predictable intervals (insurance premiums).

      To the extent that some people are at greater risk than others, that exchange can, and should, mean that that individual be willing to take more of a guarenteed loss than someone who is relatively low risk.

      This is the basic principle of all insurance, and it works fine, if you let it.

    2. That would leave me out in the cold, though, because my dependent wife is a diabetic, diagnosed while I was under my former employer’s health care plan. That plan didn’t have an extra-cost option to continue coverage after a switch to a different supplier, and a search by an agent found no one who would now cover my wife, because of her pre-existing condition. So I’m stuck paying $12,000/yr. premiums for my wife’s health care and my Medicare supplement, under my former employer’s plan.

      See, if you read my post above, I think the solution to this is to make it unlawful for your employer’s insurer to drop you, or raise your rates, if you were fully paid up at the time the condition developed.

      Or to be more accurate, to require all employer-based health insurance contracts to include provisions that guarentee they can’t do so.

    3. You sir, are a true patriot. Maybe if all the doosh dems who claim that “I should pay more in taxes, I can afford it,” would stand by their convictions and just write a bigger check (or don’t use tax shelters, or claim exemptios), we would be in a better place.

  17. How do you like all those OBAMA-PHONES (free for the POOR), WELFARE, UNEMPLOYMENT INSURANCE 99 WEEKS, FOOD STAMPS, UNION EXEMPTIONS for HEALTHCARE, backdoor BAILOUTS for BANKS using FANNIE/FREDDIE????

    PLEASE DO TELL

  18. How do you like all those OBAMA-PHONES (free for the POOR), WELFARE, UNEMPLOYMENT INSURANCE 99 WEEKS, FOOD STAMPS, UNION EXEMPTIONS for HEALTHCARE, backdoor BAILOUTS for BANKS using FANNIE/FREDDIE????

    PLEASE DO TELL

  19. The legislation has nothing to do with healthcare and everything to do with changing the relationship between the electorate and the elected.

    If one is dependent on the Fed for a benefit, one will vote for politicians who increase that benefit.

    1. Doh. Don’t let the secret out. Unfortunately, we have whole generations of citizens that are now trained to vote for the politician that promises the most benefit, and gladly give up some freedom for the “free ride”. I fear things aren’t going to change any time soon.

  20. “What will be the politically expedient thing to say next year?”

    You libertarians have got a lot of balls. See, Reason, Ronald Baily, Mandatory Health Insurance Now! It will save private medicine — and spur medical innovation.

    Asshats.

  21. I’m gonna share it in Facebook, this is really awesome

  22. Get government replica uggs out of education and kids will get educated or fake uggs for sale not, as their parents desire. More of them will actually become educated without government than do now with it.

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