The Massachusetts Mandate
The State of Massachusetts is expanding health care coverage to the state’s 500,000 uninsured, in part by making insurance mandatory to all residents. Supporters hope this form of “universal health care” becomes a model for the rest of the country. The plan will offer free or heavily-subsidized coverage to the poor; those who can afford it but refuse to carry it will face fines of over $1,000 a year and increasing tax penalties until they comply. Those already insured will see a small drop in their premiums. No new taxes are called for, as much of the money is expected to come from the state and federal reimbursements. In addition, employers who don’t currently provide health insurance will have to pay nearly $300 per employee. If signed into law, the bill would require all residents to be insured beginning in July 2007.
I guess one way to make sure everyone has insurance is to mandate it. If that’s the logic then one way to fight hunger is mandate everyone eat. One way to fight violence is mandate everyone have a gun. One way to fight racism is to mandate everyone have a friend of a different race or ethnic group. You see where this is going. The problem with the mandate (apart from it being another government mandate) is that employers who don’t offer health insurance will see their costs increase. In order to cover the costs, employers will have to raise prices, cut their own profits, or fire someone to cover the increase. None of these are good options.
If the government truly wanted to bring down the costs of health care, it should ban employers from providing health insurance at all. The costs would drop because people would become a lot more frugal about what they spend their money on. In addition, take out the insurance factor you eliminate the need for administrative costs and for companies to make a profit. See costs start to drop. If someone is irresponsible and won’t pick up their own insurance and they get sick, well, you can’t save everybody.
I am not a big fan of mandates. Inherently they drive up the costs of business and disproportionately hit the smaller guys harder. Also if you think mandates work so well, may I remind you “thou shall not kill” has been on the books for a few thousand years.
