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Not So Strange Health-Care Bedfellows

Sheldon Richman
Campaign For Liberty
Thursday, January 7th, 2010

One thing can be said in behalf of the health-insurance overhaul currently shaping up in Washington: it has revealed the curious bedfellows that politics creates. Congress almost certainly will pass a bill that compels every American to have medical insurance. If his employer doesn’t offer it, he’ll have to buy it himself or be fined.

This justifiably offends everyone who believes in individual freedom. By what right do politicians order us to buy medical coverage? They say they have a good reason: if everyone were forced to buy health insurance, the premiums would be lower for sick people, who file more claims than healthy people do. I mean no disrespect to sick people, but that’s a lousy reason to force the healthy to buy insurance they don’t want. In a really free society, force would be used only to protect innocent life from aggression. Keeping insurance premiums down falls short of that standard.

It turns out that a lot of other people think so too. In several states there are moves to block the insurance mandate. For example, in Arizona voters will vote on a state constitutional amendment to prohibit forced participation in any health-care plan. And the Los Angeles Times reports that “a group of more than a dozen state attorneys general … are exploring whether the mandate is unconstitutional.” The Times quotes Florida Atty. Gen. Bill McCollum: “It’s a tax on living.” The newspaper adds that McCollum “drew a distinction from the requirement that people buy auto insurance: Drivers make a choice to own a car.” Actually, car insurance is tied to the use of the roads, and even private road owners would have the right to admit only insured drivers to their property. Moreover, drivers are required only to have liability insurance; they are free to forgo coverage for their own cars.

So here’s the odd bedfellows angle: while big-government opponents (and Republican opportunists) are gearing up to fight the insurance mandate, guess who’s all gung-ho for it besides the Democrats: the insurance companies!

Savor that for a moment. For a full year President Obama and his congressional allies have bashed those companies as the devil incarnate: They won’t cover people who are already sick; they cancel policies after people get sick; they impose annual and lifetime benefit limits; they resist paying benefits; they charge sick people higher premiums than healthy people — and on and on. No self-respecting health-care “reformer” would be caught dead in the same room with these nefarious profit-driven guys. Right?

Wrong.

The “reformers” have been in locked rooms with them regularly in what can only be called a conspiracy against the public. What unites them enough to overcome their few differences? The insurance mandate. Since the legislative process started a year ago, one element has been unquestioned: compulsory insurance. True, Obama opposed an individual mandate during his campaign for president. He needed to distinguish himself from his pro-mandate opponent, Hillary Clinton. But once Clinton was safely ensconced in the State Department, Obama came around. Dash the campaign promise.

There’s really no need to explain why the insurance industry has been eager to accept every provision demanded by the Democrats (except the “public option”) — including coverage for preexisting conditions, guaranteed renewal, and price uniformity regardless of health — as long as the mandate is in the bill. Under a mandate the industry would have millions of new captive customers, mostly healthy young people who will pay premiums but make few claims. This will mean huge new politically derived profits. In economics, it’s called rent-seeking — a form of privilege.

In fact, the insurance industry has only one complaint. The penalty for not complying with the mandate is too low! “We think there’s more that [the legislation] needs to do,” America’s Health Insurance Plans spokesman Robert Zirkelbach said. “There’s still a strong incentive for people to wait until they are sick to purchase insurance.”

In other words, the insurance industry is willing to cover all comers if everyone is effectively forced to buy its product.

Freedom is trashed whenever “reformers” and the industry they seek to “reform” get behind closed doors.

View the original article at Campaign For Liberty

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