Health Reform Topics

Does a Mandate Matter?

Recently, New America Health Policy Program Director, Len Nichols, teamed up with well-known health care economists Jonathan Gruber of MIT, and Mark Pauly of the University of Pennsylvania, to release a policy brief explaining the value of an individual mandate when pursuing a system of coverage for all Americans. "Health Debate Reality Check: The Role of Individual Requirements," and the subsequent teleconference, outlined the authors' reasons for supporting an individual requirement to purchase health insurance, and answered questions about the feasibility of enforcing a mandate.

As of late, many journalists have also in weighed in on the value of an individual mandate. In two successive Friday columns (December 7 and November 30), Paul Krugman of the New York Times criticized Senator Obama for forgoing a mandate in his health care plan and detailed why he believes Obama's attacks on Senator Clinton are aiding those who oppose health reform. Jonathan Cohn of The New Republic has also tackled the mandate question. In, "Mandate Overboard," Cohn discusses the logic and theory behind the individual mandate and in a recent blog post, he explains estimates suggesting that a health care plan without a mandate will leave 15 million people uninsured.

On December 5, the Wall Street Journal asserted that while mandates may be needed to get everyone insured, it remains uncertain if these plans provide enough subsidies to make the mandates affordable. That same day, Krugman's colleague, Katherine Seelyle, took a skeptical position towards individual purchase requirements. In "Clinton Attack on Obama Overlooks Some Realities," Seelyle questions the feasibility of enforcing a mandate and whether a requirement to purchase insurance would actually help achieve universal coverage.

The New America Foundation has long advocated for an individual requirement to purchase health insurance. In an Op-Ed featured in the American Prospect Online in June, Len Nichols explained how an individual mandate can actually help markets work more effectively, while alleviating the "free rider" problem that unnecessarily burdens our health care system. In New America's latest vision for health reform, Nichols outlines a proposal that would cover all Americans through a combination of an individual requirement to purchase insurance, subsidies for the low-income, and a more efficient delivery system. In addition, the Health Policy Program provided policy development advice to Senator Wyden and Governor Schwarzenegger as they developed their respective proposals. Both include an individual mandate.

New America has also been a leader in helping to develop strategies to enforce an individual requirement to purchase coverage. In "Coverage Without Gaps," and "What Your Car Can Teach You About Health Reform," Nichols and Peter Harbage focus on the California reform discussion and explain how the concepts of shared responsibility and seamless coverage could lead to a reasonable enforcement strategy and coverage for all Californians.

As the debate continues on the question "Does a mandate matter?", Massachusetts is preparing to experience the effects of an individual requirement to purchase insurance first-hand. By the end of 2007, individuals in Massachusetts are required to have health insurance or to pay a small tax penalty. As profiled in the New York Times on November 25, Jon M. Kingsdale, executive director of the Commonwealth Health Insurance Connector Authority in Massachusetts said, ""There's good evidence whether it's buying auto insurance or wearing seat belts or motorcycle helmets, that mandates don't work 100 percent. We're talking about how close you can get to 100 percent, and to me it's pretty evident you can't get as close without the mandate as you can with it."

Bipartisan Health Reform

On September 1, the Los Angeles Times reported that California Governor Arnold Schwarzenegger and Assembly Speaker Fabian Nunez were moving towards a deal on health reform. Negotiations continue and the Governor has called the legislature to a special session to seek compromise on an overhaul of California’s health system.

Talks between the Governor and the legislature, however, are not the only indication that there is a growing momentum for change in California. On September 7, the California Hospital Association announced it would support the Governor’s plan, including the proposed tax on hospitals. In addition, on September 18, the Los Angeles Chamber of Commerce broke with the California Chamber’s position and lent its support to the Governor’s efforts. David Fleming, chairman of the Los Angeles Chamber supports the shared responsibility approach endorsed by Schwarzenegger and the New America Foundation, "We believe everyone should be part of the solution, not just business…Everybody has to have skin in this game."

Governor Schwarzenegger’s proposal closely resembles another effort gaining bipartisan support in Washington. On August 2, Senators Lamar Alexander (R-TN), Judd Gregg (R-NH), and Bill Nelson (D-FL), joined Senators Ron Wyden (D-OR) and Robert Bennett (R-UT) in cosponsoring the Healthy Americans Act (HAA), a bold health care reform proposal that would guarantee every American access to quality affordable health coverage. Just days before, on July 24, Representatives Baird (D-WA), Emerson (R-MO), Cooper (D-TN), and Blumenauer (D-OR) introduced companion legislation in the House of Representatives. This growing joint effort marks the first bipartisan, bicameral attempt at comprehensive health care reform in over a decade. Both the HAA and the Governor’s plan propose an individual mandate coupled with low-income subsidies, market reform, and increased emphasis on health living and prevention. A similar model has also been endorsed by Presidential candidates Senator Hillary Clinton and former Senator John Edwards.

Len Nichols, Director of the New America Foundation’s Health Policy Program, said, “The big message is how similar the plans are. These are very smart people who are ending up with very much the same rough contours. The biggest lesson we can learn from the Clinton-Era debates is the significance of bipartisanship and leadership. As we look towards health reform in California and across the nation we should focus on finding common ground with our adversaries and supporting leaders willing to identify reasonable solutions.”