Romney’s plan isn’t perfect. First, my preference is for a mandate for CATASTROPHIC COVERAGE, not absurdly expensive front-end coverage that is the equivalent of trying to use auto insurance to pay for my gasoline. Second, I would have preferred an opt-out provision if someone could demonstrate they had the personal assets to cover a high-end loss or forego treatment entirely. However, even in this case, one potential problem is that life-time care for a quadriplegiac—as one example—can run into millions of dollars, but even keeping someone on life support for a few weeks can approach $1 million.
That said, in the context of the very imperfect policy environment created by federal emergency care mandates, I think that Romney’s state-level solution has the promise to move things more in the direction of what’s fair even if it wouldn’t be optimal.
Trying to collect after the fact is appealing but unrealistic. The $40+ billion in unpaid bills for the uninsured occurs DESPITE the efforts of hospitals to collect from these patients. Indeed, hospitals have been criticized for being TOO AGGRESSIVE in trying to collect these losses.
Collectively, the uninsured actually CAN pay these bills: it simply amounts to collecting <$100 monthly from each of them REGARDLESS OF THEIR HEALTH STATUS. That’s how insurance works: we don’t know ex ante who the unlucky one will be even though statistically we can be pretty certain these losses will amount to roughly $1000 apiece.
But in the general population, 10% of patients generate 70% of all spending, and 1% generate 30% of spending. For these unlucky 1 percenters, you’d be trying to collect $100,000 apiece, not $1,000. Good luck. But with a mandate, you would have collected an affordable amount from everyone and covering even these large bills wouldn’t be a problem.
Americans have a pretty absurd attitude about health insurance. I’ve paid my homeowner’s and auto insurance for years on end without collecting a dime: does that mean I feel gypped or taken advantage of? Of course not, I buy it because I like the piece of mind of not having to come up with tens or hundreds of thousands of dollars in the event of something that happens that may be completely out of my control. So unless one has the assets to cover a very sizable financial loss, anyone going bare on health insurance is essentially “free-riding” on the rest of us since in the real world, when they’re on life support because of that unexpected heart attack they got even though, like Jim Fixx, they were in marathon-level shape, someone else will end up paying their tab. And I for one find it very objectionable to be FORCED to pay for such an individual’s care by their irresponsible decision to free-ride.
In short, the argument for an individual mandate originates in self-interest, not altruism, and I concur with an earlier poster who observed that Romney’s approach is almost the farthest thing from Hillarycare as one can imagine.
You make a strong case for mandates. However, I cannot imagine a mandate for catastrophic coverage only. Most people do not consider catastrophic coverage as health insurance. They prefer the coverage equivalent to using auto insurance to pay for gasoline. The rats have encouraged this thinking for a long time. The rats will not allow any mandate just for catastrophic coverage. I understand that the law in Massachusetts contains many mandated coverage areas beyond catastrophic care. The rats view universal health insurance as another opportunity for a new entitlement. They will only use the free riding issue to justify a new entitlement.