What winning looks like: health care division

The health insurers are now offering to trade no-exclusions, community-rated individual health insurance for mandated purchase.

I’d expected this, but not so fast. The two health-insurance trade groups have now endorsed an individual mandate for health insurance coverage.

The Obama plan as presented during the campaign had a gaping policy hole in it. If private insurers were required to cover individuals regardless of pre-existing conditions, but individuals weren’t required to purchase coverage, then it would be reasonable for people, and especially for the young and healthy, to forgo coverage until they got sick. That would have bankrupted the private health insurance industry by driving its premiums so high that it couldn’t compete with the alternative public plan.

At that point, one of two things would have happened. The private insurance industry would have collapsed &#8212 good riddance to bad garbage &#8212 thus backing the country into a single-payer system, or the private insurers, with their army of lobbyists, tame think-tank pseudo-scholars, and captive Congressmen and Senators would have had to demand a mandate, which the Democrats could then graciously grant.

Now it looks as if the insurers have jumped the gun, agreeing to offer individual insurance with no exclusions for pre-existing conditions as long as there’s a mandate to buy insurance.

If Obama had proposed such a mandate, the health insurers would have had “Harry and Louise” all over your TV set talking about how oppressive the whole idea was and how they could never afford it. Now it’s their idea.

This may still be a head-fake by the insurers, intended to insert a poison pill into the Obama plan, though I don’t think it is. And of course the Obama folks aren’t rising to the bait – yet.

But I think the outlines of the final deal are now in view: a mandate on employers to buy insurance for their employees (other than the small businesses whose sacred right to exploit the rest of us by skimping on public goods contributions must not be challenged) and an individual mandate for small-business employees, the self-employed, and the unemployed to buy their own insurance, supported by hefty public subsidies.

Yes, of course that just kicks the cost-containment can down the road. But I’m satisfied to solve one problem at a time.

Sixty years after Harry S. Truman proposed national health insurance, it’s finally going to become a reality. I propose that we call whatever passes “Harry’s Law.” Better than any monument built of mere marble.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com