Losing the Individual Mandate Would Be a Win, But It Wouldn't Be a Victory


Earlier this week, Politico published a story suggesting that the individual mandate might be on its way out because a handful of Democratic moderates in the Senate are looking for ways to get rid of it. But that probably wouldn't mean simply excising it from the law. As this NPR story suggests, any move to get rid of the mandate would likely also mean a move to replace it with a different policy.

As I've written before, there are a number of policies that could conceivably serve as an alternative to the mandate and be more likely to pass constitutional muster. For example, you might turn the penalty into an incentive. Or you could drop the policy at the federal level and set up financial incentives for states to enforce the mandate. You could also set up limited enrollment periods so that individuals can't jump on and off their health insurance whenever it's convenient.

These sorts of policy alternatives might solve the law's constitutional troubles. But they won't fix the health care overhaul's long-term policy problems. The law would still have an unaffordable expansion of Medicaid, a program that wastes billions on care of dubious effectiveness. It would still put in place insurance rules that are bound to be gamed, and bound to give individuals fewer choices. It would still institute a system of middle-class insurance subsidies that give employers a strong incentive to dump their insurers into government-run health insurance. And it's still likely to lead to serious long-term deficit damage and the same sort of massive cost-overruns we've seen in Massachusetts, the one state that's already implemented the same basic health policy framework.

All of this would largely be true even if you got rid of the mandate and offered no replacement whatsoever. The mandate is a serious problem from a constitutional perspective, and it certainly deserves to go. But simply losing the mandate and moving on won't cure the law's substantive policy problems.