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The mandate, rebuked

December 16, 2010 - Mike Maneval
Federal Judge Henry E. Hudson has struck down the mandate individuals purchase health insurance beginning in 2014, rebuking and rejecting what he called "the authority of Congress to compel anyone to purchase health insurance."

While pundits projecting Judge Hudson's ruling places the health care reform act of 2010 on "life support" are getting ahead of themselves, the ruling is promising - if allowed by higher courts to stand it strips the law of its most onerous and counterproductive element, while the ruling maintains the other provisions could proceed sans mandate - including the ban on the use of "pre-existing conditions" by insurers to deny coverage, a measure popular enough congressional Republicans have elevated the flip-flop to a pedestal, claiming after repealing the law and its ban on pre-existing conditions to immediately reverse course and adopt a ban on such denials of coverage as separate legislation.

Still, Newsweek's Ben Adler wrings his hands over this development, opining, "to keep the rest of the bill in place without the mandate would provoke the wrath of the insurance companies’ powerful lobby and set premiums on an upward-spiraling trajectory."

Adler, however, is wrong: Premiums have been on "an upward-spiraling trajectory" for years, before the provisions of the health care act the insurers say necessitate the mandate were even debated, let alone passed. And simple contemplation of supply and demand reveals if demand is expanded by compulsory consumption, its check and balance on excessive pricing is neutered - if everyone has to buy health insurance, the industry can push the envelope on raising prices and still consumers would be unable to refuse the overpriced product.

Some may suggest I'm "stoking resentment" by suggesting that, if given the opportunity, insurers would soak a public required to buy their services. But, really, the mandate itself is based on a hypothesis consumers would otherwise skate on purchasing insurance until it would be vitally needed to minimize personal costs, riding the proverbial coattails of consumers who've purchased policies in a more responsible timeframe. It is a theory no less rooted in "resentment" and suspicion of consumer motives than fears the mandate is a green light for insurer price-gouging is rooted in "resentment" of the merchants' motives.


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