Mr. Obama’s employer mandate could force 80 million Americans to switch from their current health plan to a more expensive one, threatening their current source of care. Premiums would climb further as providers and other special interests demand that Congress mandate coverage of their services. As premiums rise, more people will require government subsidies to comply with the mandate.
(3) No price controls.
Price controls have failed in every application throughout history, including health insurance.
Economists find that free markets provide secure health insurance to lots of sick people, and that forcing insurers to charge the same premiums to healthy and sick people offers no improvement. Instead, such premium controls encourage insurers to avoid the sick, and encourage healthy people to avoid insurance altogether.
Premium controls may even cost you your health plan. In the health insurance “exchanges” of the federal government, Harvard University and the University of California, premium controls forced carriers to eliminate comprehensive insurance options.
Taken together, mandates and premium controls would effectively socialize private health insurance. They would eliminate both low-cost and comprehensive insurance options, and slowly march everyone into a narrow range of health plans. If government controls the decision to purchase, what you purchase, and the price, that is government-run health care.
Holding the line against socialized medicine won’t be easy, but it can be done. Blocking new public programs will be easiest thanks to industry opposition. According to one report, “Hospitals and doctors fear another public program would reduce what they are paid, as Medicare and Medicaid have done. Insurers worry they could lose customers to the government.”
Mandates and price controls will be harder to stop, since the industry and certain struggling employers would love to use those measures to hurt their competitors or otherwise pad their bottom lines. The health insurance lobby, for example, is all too happy to force you to buy health insurance.
Fortunately, opponents have many arrows in their quiver. Mandates are anathema to most employers. Working families will resist being ousted from their current health plan and forced into one that’s more expensive or that won’t let them see their family doctor. Mandates would give Congress the power to force Americans to fund contraception and abortion, which will mobilize social conservatives.
The Left has been adding arrows to the quiver, too. Mr. Obama himself attacked Hillary Clinton for wanting to “force uninsured people to buy insurance.” His prospective National Economic Council chairman, Larry Summers, describes employer mandates as “disguised tax and expenditure measures” that increase unemployment, work against the very people they purport to help, and expand the size of government. Obama campaign adviser David Cutler documented the effect of premium controls on coverage choices at Harvard.
The most important arrow in the quiver may be the self-interest of the Republican Party. Bill Clinton demonstrated that the most effective way to block tax cuts is to paint them as an assault on your health care. Twenty-eight percent of Americans already depend on government for health insurance. If that share grows, whether through government programs or subsidies for “private” coverage, we can start writing obituaries for the party of tax cuts.
An intolerable status quo is no excuse for making things worse. The center-right needs to mobilize now to stop left-wing Democrats from taking another large leap toward socialized medicine.
Michael F. Cannon is director of health policy studies at the Cato Institute and coauthor of “Healthy Competition: What’s Holding Back Health Care and How to Free It.”