No Insurance Mandate

As the debate regarding health care insurance rages around me I have found myself frustrated by comments and concerns made by friends and family and the threat of insurance mandates. Currently, I have no health insurance. Arguably, this may not be the best decision in my case, but it is my current situation. I understand I am now “self-insured” and if something happens I have to pay for it.

Crazily, I have friends and family who cannot imagine a life without health insurance. The government is also contemplating an insurance mandate; if you fail to buy insurance you will be fined. Since the IRS is the enforcer of this, I see it as a tax increase, especially considering the amount is approximately $3,800/year. What really bothers me is the idea of an insurance mandate when insurance, by definition, is coverage by contract in which one party agrees to indemnify or reimburse another for loss that occurs under the terms of the contract. Mandating a contract erodes the market forces that should lower prices.

This summer I was vacationing with my family and found myself in need of emergency care. I mentally debated for several hours my options: do not seek care, self-medicate, visit an urgent care, or head to the ER. Ultimately I spent seven hours in the emergency room, received outstanding service and a plethora of intravenous medicines. The doctors clearly discussed with me options of spending the night, further analysis, and how to proceed. Market forces were at work – no unnecessary tests were made, and I full participated in the decision making process. Upon returning from vacation the bill was waiting in the mailbox. At first glance the amount concerned me, but I quickly analyzed the numbers and realized the amount due was equal to two months of former family health care premiums. Since I had not made premium payments in prior five months I knew I was better off., and more than likely, I will not have any significant events before the end of the year.

I was disgusted when one family member recommended we not pay the bill. She said that she just ignores them and the hospital will ultimately write it off as indigent or uncollectable. Of course, they will just have to pass these costs onto others. Another friend was appalled that we do not have insurance and wondered what we would do if we had to go to the doctor. I made the economic argument above, it is cheaper to have high deductible insurance and pay as you go, but it fell on deaf ears. Of course, she depends on doctors for everything, has significant monthly prescription requirements, and does not have savings of her own to pay.

People make life choices and I believe too many consumers choose to live for the moment: buying a boat, car, cable television, or even a cellular phone. Losing material possessions due to an illness is sad, but not catastrophic, it’s just stuff. Failing to take personal responsibility should not result in mandated insurance programs and erosion of personal freedoms. My reforms and solutions are much simpler: require people to pay for the services they use and hold them accountable, and yes they may go broke in the process, reign in the cost of malpractice through tort reform, and modify regulations to allow interstate purchase of insurance thus equalizing premiums across the states. No one will be denied quality health care and the market will adjust prices appropriately.

Copyright (c) 2009 John R. Nelson. All Rights Reserved.