Among the biggest debates not only in the U.S. but all over the world as well is health care. People have cherished good health over the years so much that in most cultures there is at least one general wish that has to do with the other side’s good health.
Since health care is such an important issue in everyday life, a minor concern about it is likely to spark a debate between interest groups from both sides. These debates range from:
whether or not the government – whether central or local – should provide health care for its constituents;
whether health care should be privatized
whether health care should be both privatized and socialized
whether there should be mandates imposed by the government on health insurance companies regarding their health insurance policies
The Yankee Institute for Public Policy sent me a report that they made on April on health care in Connecticut but it provides better understanding on the private sector’s behavior as a result of government imposed mandates, and also a better understanding on the public sector’s behavior as a result of public hearings on health care. It is a 15-page report titled “Bad Medicine: Connecticut’s 54 (and counting) Health Insurance Mangates” by Yankee Institute fellow Tamara Tragakiss who explained a comparatively complicated material in probably the most concise and easy to digest way.
The private sector and the public sector
Health mandates – medical conditions that must be covered in a health insurance plan – raise the health care costs usually on both individuals and groups. Among the reasons behind enacting these mandates, as the report noted, are:
pressure from interest groups and constituents. By voting no on mandates, a legislator risks having their reputation tarnished on the local newspapers. Moreover, if, for example, there are people directly affected by that certain medical condition which is being debated on whether to be imposed as a group and/or individual health care policy mandate during a committee’s public hearing on health care, emotions might prevail and subsequently cause legislators to pass that medical condition as a mandate.
just a slight increase in premiums. The rationale behind this reason is that mandating medical conditions such as autism – which is calculated to go easy on the premium costs, according to estimates by the Council for Affordable Insurance (CAHI) who were quoted by the report – to be covered in health insurance policies will make every policy holder happy for next to nothing. The problem with this rationale is that adding even cheap mandates one by one could skyrocket premiums, and the final result is everybody paying extra for something that at least a certain percentage of the policy holders either doesn’t want it or doesn’t need it. Meanwhile more people are likely to end up being uninsured and more businesses are likely to shrink or not grow (lay off workers or not create new jobs thus adding to the unemployment rate overall) – bacause they can’t afford the high costs, and at the same time cannot design their own plan which otherwise wouldn’t include some, if not many, of the mandates.
Tamara Tragakiss ends up her report with four free-market policy alternatives to mandates two of which I liked a lot:
Current mandates to be reviewed by the legislature and be considered for abolishment.
Potential mandates to be reviewed by the legislature as to what they would cost the public so that the legislature addresses their potential impacts on health care costs (premiums).
What I didn’t like in this report as a reader who is majoring in Political Science and minoring in Economics and Legal Studies is that it failed in a certain regard to explain why Connecticut with its 54 mandates has the fourth most expensive family premiums overall and is the most expensive place to insure a family in firms smaller than 50 employees – since that same state has 16 mandates less than Rhode Island (which has enacted 70 mandates), 12 mandates less than Maryland (66), and 6 mandates less than Virginia. All the more that most of Connecticut’s mandates, as shown on the report’s last page, concern both group (business, family) and individual (self-employed or other) plans.
That further step – even if it shows exceptions to the consumer behavior rules – would improve the otherwise marvellous report.