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Morning Bell: Stop the Health Care Bailout Before it Starts

Morning Bell: Stop the Health Care Bailout Before it Starts

The last time Congress debated fundamental health care reform, America’s health insurance industry fought against more government control of your health care, most famously with the “Harry and Louise” ad depicting a typical middle class family in despair. This time around, however, the health insurance industry is supporting more government control of your health care. Why? Because key reformers are offering to use government coercion to force fifty million Americans to become new health insurance customers. What industry wouldn’t want the government to create 50 million new customers overnight?

In his primary challenge with then-Senator Hillary Clinton, then-Senator Barack Obama said he was against government mandates that would force individuals to buy health insurance. Now that he is in power, President Obama is much more open to the idea. Before he departed for the Middle East and Europe last week, President Obama sent a letter to Congress explaining he would support mandates if they enabled him to also establish a government-run health insurance plan. We’ve covered the dangers of a public health insurance plan before, so we’ll turn to a study written by one of Obama’s own nominees, HHS Assistant Secretary of Planning and Evaluation Dr. Sherry Glied, to detail why individual mandates would be terrible public policy:

  • High Costs: “Funds diverted from uncompensated care would not be sufficient to pay for the subsidies needed to cover most uninsured people. Eliminating the free-rider problem through universal insurance might make the health care system more fair, but it wouldn’t make it less costly.”
  • A New Tax: “The mandate is in many respects analogous to a tax. It requires people to make payments for something whether they want it or not.”
  • Special Interest Bonanza: “The relative invisibility of the mandate ’tax’ may make it easier for special interests to achieve their goals. The mandate, then, would become a means through which special interests use government to force transfers of funds from consumers to the health care sector.”
  • Unprecedented Intrusion: “Like taxes, a mandate requires enforcement if it is to be effective. …Developing a system to promptly identify and penalize scofflaws will take effort and ingenuity, particularly in our diverse and mobile country. It may require a degree of intrusiveness and bureaucracy that some will find unpalatable.”

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