NCPA - National Center for Policy Analysis

The Individual Mandate: Ineffective, Overreaching, Unsustainable, Unconstitutional and Unnecessary

April 5, 2012

The U.S. Supreme Court will continue to debate the constitutionality of the Patient Protection and Affordable Care Act (PPACA) over the next several months, but a great deal can be said about the law that has nothing to do with its noncompliance with the Constitution.  Rather, much focus can be placed on its costliness, ineffectiveness and burdensome regulatory scheme, says Tom Miller, a resident fellow at the American Enterprise Institute.

In terms of paying for an overhauled health care system, the individual mandate represents a truly innovative mechanism for hoodwinking the American public by hiding the true cost of the program.

  • The individual mandate attempts to drive down premiums by pulling more healthy consumers into insurance pools.
  • However, the same end could have been accomplished through a simple tax increase, the proceeds of which would be dedicated to subsidizing premiums for low-income individuals.
  • The fact that the Obama administration sought this roundabout means of financing nationalized health care underlines the lack of political support that the PPACA truly has.

Additionally, reform advocates suggest that the PPACA will drive down costs for all by streamlining the health care system.  Economic theory regarding constricted supply and overstimulated demand tells us that this claim is blatantly false.

Furthermore, the complicated financial structure of the program will leave regulators and participants confused and unsure of their options.  Years after the law was passed, a number of questions still have not been answered:

  • First, how to determine whether a person is exempt from "unaffordable" mandated coverage;
  • Second, if the person is not exempt, how to estimate whether he or she is eligible for various levels of premium subsidies through Medicaid or tax credits;
  • Third, how to settle up later in the following tax year the final amount of subsidies versus premium payments to account for differences in actual household income reported to the IRS.

Finally, the concern remains that this sweeping grant of control over citizens' private lives to the federal government will act as a "gateway drug" to further regulation.  The individual mandate is unprecedented in its subjugation of the individual and sets a dangerous precedent for future government policies.

Source: Tom Miller, "The Individual Mandate: Ineffective, Overreaching, Unsustainable, Unconstitutional and Unnecessary," American Enterprise Institute, March 23, 2012.

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