Obama Administration: Popular Consumer Protections Can’t Survive Without Individual Mandate

Brad Joondeph points out that the United States government is now conceding — in a brief filed before the Eleventh Circuit Court of Appeals — — that the Affordable Care Act’s “community-rating and guaranteed-issue provisions are not severable from the minimum coverage provision.” That is, one can’t ask insurance companies to accept everyone who applies and charge them an equal rate without also telling people that they can’t game the system by purchasing insurance only when they need it. Joondeph argues that this kind of argument makes sense for three reasons:

First, making such a concession only bolsters the government’s argument that the minimum coverage provision is essential to the ACA’s broader regulation of the health insurance or health care services markets. Second, it makes the government seem more reasonable. Third, it essentially forces the Supreme Court’s hand a bit when the case ultimately gets there: if the justices want to take down the mandate (which might be politically popular), they will also have to bring down the ACA provisions that overwhelming majorities of Americans support. And that would not be so popular.

It also rings very true in many states where policy makers have imposed insurance regulations without an individual requirement. That has resulted in skyrocketing premiums and a departure of insurers from the marketpalce. As one amicus brief filed by a broad coalition of health advocacy groups recently pointed out:

– MAINE: “A 2001 report found that 13 of 18 major carriers ceased issuing new policies to individuals during the eight years since the provision became law,” in 1993….”Many insurance providers doubled their premiums in just three years or less, and all but one of the state’s HMOs experienced ‘at least one rate increase of 25% or more in 1998 or 1999.”


– NEW HAMPSHIRE: “New Hampshire was nearly left with no carriers in the market when Blue Cross Blue Shield of New Hampshire announced it was withdrawing from the individual market.”

– NEW YORK: “New York enacted preexisting condition provisions for the individual market in 1993. Consequently, the portion of non-elderly New Yorkers without insurance worsened from 16.5 percent in 1992 to 20 percent in 1997.”

Republican health care proposals also recognize that fundamental insurance market reform is incredibly costly — probably impossible — without encouraging everyone to buy into the system and so they go only half way in preventing insurers from denying coverage to people with pre-existing conditions. They may protect individuals who recently lost their coverage or were previously insured, but can’t credibly extend those protections to the whole of the uninsured without asking healthier Americans to pay into the system.