NCPA - National Center for Policy Analysis


February 8, 2008

What's behind the growing cost of health insurance?  The most likely culprits are our politicians and the laws they pass, say Victoria C. Bunce, research and policy director at the Council for Affordable Health Insurance; and J.P. Wieske, director of state affairs at CAHI.

Since the early 1990s, CAHI has tracked state health-insurance mandate legislation in all 50 states and estimated the impact of those mandated benefits on the cost of a policy.

A health-insurance "mandate" is a legislative requirement that an insurance company or health plan cover (or offer coverage for) common -- but sometimes not so common -- health- care providers, benefits and patient populations.  They include:

  • Providers such as chiropractors (mandated in 46 states) and podiatrists (35 states), but also massage therapists (four states) and naturopaths (four states);
  • Benefits such as mammograms (50 states) and drug abuse treatment (34 states), but also morbid obesity treatment (four states) and wigs for cancer patients (10 states);
  • Populations such as dependent students (30 states), but also grandchildren (four states).

Although there were only a handful of state mandates in the 1960s, CAHI's just released "Health Insurance Mandates in the States, 2008" has identified 1,961 nationwide -- up from 1,901 a year ago.

For almost every health-care product or service, there are at least two groups that want insurance to cover it: those who sell the products and services so they can get more business, and those who use the products and services to lower their out-of-pocket costs. 

Both of these highly motivated groups push state legislators -- and increasingly members of Congress -- to require insurance to cover the care.  As a result, government interference in and control of the health-care system is steadily increasing -- and so is the cost of health insurance, say Bunce and Wieske.

Source: Victoria C. Bunce and J.P. Wieske, "Mandate Update," Wall Street Journal, February 8, 2008.

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