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Thursday, May 19, 2011

To be or not to be….for individual responsibility

Eileen Falk

Staff Writer

Many people in Massachusetts are proud, and rightfully so: The state’s version of health care reform, one that includes an individual responsibility requirement, signed into law by former Governor Mitt Romney in 2006, has helped lower Massachusetts’ uninsured rate to  just 2%. Considering that percentage of uninsured hovers near 15% nationally, that’s a huge deal. Health policy analysts across the country acknowledge that Massachusetts’ health care law provided a basic template for the Affordable Care Act.

And last week on MSNBC, current Massachusetts Governor Deval Patrick said that a presentation by Romney convinced him to support the individual mandate.

Meanwhile, on Sunday, Newt Gingrich stated that, “I believe all of us have a responsibility to help pay for health care. There are ways to do it that make libertarians relatively happy. You either have health insurance or you post a bond,” which he cited as a “variation” on the individual responsibility provision in the Affordable Care Act.

However, on Monday he released a video stating:

I am completely opposed to the Obamacare mandate on individuals … I am for the repeal of Obamacare, and I am against any effort to impose a federal mandate on anyone because it is fundamentally wrong, and I believe unconstitutional.

In an attempt to distance himself from his own comments, Gingrich again contradicted himself and confused the public by claiming that individual responsibility requirements  are unconstitutional, while only one day earlier he had expressed clear support for individual responsibility.

Others have struggled to settle on a position on individual responsibility. During the Clinton administration, Senators Grassley and Hatch supported a bill that included individual responsibility requirements and Senator DeMint cited the success of Romney’s universal health care and individual responsibility requirements in his support of Romney’s presidential candidacy in 2007.

The truth is, the individual responsibility provisions in the Affordable Care Act should not create such confusion. First, most people have insurance and are not affected by a requirement that everyone have insurance. In addition, the requirement to purchase insurance has a number of exceptions, including: anyone with income below the tax filing threshold; anyone who would have to pay more than 8 percent of their family income for insurance; and anyone who is part of a religion opposed to health coverage.  

Second, when people who can truly afford health insurance and decide to not buy coverage, the decision can be expensive for the rest of us who do buy insurance. When someone without insurance ends up needing health care services (even the youngest and healthiest among us cannot predict what health crisis might strike unexpectedly), the cost of their often unpaid care ends up being shifted to others through higher hospital and doctor bills. When insurance companies have to pay these higher bills, they pass these costs on to people and businesses through higher insurance premiums. Today, the average family premium costs more than $1,000 more because of unpaid care.

Third, many of the provisions of the Affordable Health Care Act cannot exist without an individual responsibility requirement. Many of the reforms that guarantee that every American can buy insurance and that eliminate denials, exclusions, and sky-high premiums for people with pre-existing conditions will not work without the individual responsibility requirement. Too many people might try to “game the system” and wait until they are sick to buy health insurance—again driving up premiums for the rest of us. The concept of health insurance is that we share risk; that is, we pay for insurance when we are healthy so that it is there when we are sick. Imagine if people could wait until their house is burning to buy home owner’s insurance—you can bet the price of homeowner’s insurance would soar.

The basic concept of the individual responsibility requirement is that everyone needs to pay what they can realistically afford—their fair share—for the health system to work well for everyone. It doesn’t seem that hard to understand. So why are some politicians suddenly feeling confused about individual responsibility? We will let you answer that question.