There may remain legitimate reasons to oppose HCR reform, but concerns over the mandate to purchase health insurance enforced by tax penalty is not one of them
One major criticism of the HCR bill is the tax imposed on citizens who choose not to purchase health insurance. It is said this tax penalizes consumers who make the rational decision not to purchase a product they don't need. At first I was seduced by the logic of this argument. Then I got to thinking about the tax in place today to pay for uninsured folks who suddenly, and often unexpectedly, discover they do need health insurance coverage but have none and, due to their recently discovered need, cannot now get any. Despite lacking insurance coverage these people often do go to emergency rooms and get treatment. This treatment is paid for in significant part by a tax visited upon those who do have health insurance, in the form of higher premiums. Even uninsured people in need of health care who do not seek treatment impose costs upon society in general.
When viewed from this perspective, I believe the HCR bill appropriately internalizes the societal costs that result when people decide to forego health insurance. But does the bill provide sufficient support to those who simply cannot afford to purchase insurance coverage? By, among other things, increasing medicaid coverage, providing subsidies or tax credits to lower income folks who purchase health insurance, and raising to age 26 the dependent coverage limit, I think the bill sufficiently addresses this concern. Certainly the bill would be much improved if these subsidies and other government provided financial support were not being directed exclusively into the coffers of the private insurance industry. Nevertheless, the bill is an improvement at least in more appropriately assigning the costs of the uninsured to those who can best avoid those costs. Hopefully the influx of healthy individuals into the insured risk pool will lower premiums for all, and we must be vigilant in seeing that this is the case. We must also be vigilant in continuing to press for a public option, whether it be a Medicare buy in or otherwise.
I am comfortable with the level of financial assistance the bill provides to those individuals whose decision to forego health insurance is due to economic necessity. I would be happy to see this assistance increased. Still, I believe the bill creates a larger risk pool comprised of many more healthy individuals while mandating individuals with health issues can no longer be denied coverage. I believe this will result in better and more affordable insurance. I understand why some still oppose the bill due to its restrictive choice language and lack of a public option. I do not, however, believe the mandate and tax penalty provide a reason to oppose this bill. The President and Democrats should do a much better job of countering this argument by pointing out the tax imposed today on the insured and society at large, and how this new tax lowers overall societal costs while directing taxation at the individuals who can avoid it by purchasing insurance. This should lower today's hidden health insurance premium tax for most voters who after all have coverage today.
It is great the overwhelming majority of today's uninsured will have health insurance when the bill is enacted. It is terrific that pre-existing conditions will no longer render people uninsurable. And it is high time insurers are barred from dropping paying customers who develop a need for medical treatment. But it is also important that the more widespread benefits of HCR reform be communicated to voters. The mandate to buy insurance enforced with a penalty tax is not imposition of a new tax. It restructures the hidden tax that exists today and which is paid by all the insured. By doing so the bill provides benefits to the vast majority of citizens, not just the uninsured and sick.