The League

Open-Enrollment vs. the Mandate

by Erik Kain · February 5, 2011

Tags: Healthcare Reform individual mandate

Erik Kain

Erik writes about video games at Forbes and politics at Mother Jones. He's the contributor of The League though he hasn't written much here lately. He can be found occasionally composing 140 character cultural analysis on Twitter.

Trumwill says:

February 5, 2011 at 2:52 pm

It was Aaron W. I chimed in with The Trumwill Plan which involves using the same incentives (including OEPs) used for group plans as well as some rules about when PECs must be covered.

Klein’s skepticism is somewhat off the mark, I think. Or rather, it overlooks that the Mandate is relatively weak. Young people that are unemployed or only semi-employed are as likely as not to still forgo insurance if they don’t think they’re going to need it. The same would be true with an OEP. The alternative is something harsher than the Mandate, which is not politically viable.

Also, it would be important to add a provision that if you get insurance within a specified time period after losing your job (and/or existing insurance) that it would be analogous to the OEP. I forgot to mention this in my plan, too. COBRA has its limitations. This is similar to what group plans do, where you can add your spouse and/or children any time of the year so long as you can demonstrate a “change in circumstance” (ie your spouse loses their job or their insurance).Report
Boonton says:

February 5, 2011 at 3:48 pm

A like idea I’ve seen is a type of ‘pay or play’. If you don’t get insurance coverage, none of the laws protections will apply to you. If you get a pre-existing condition or if you get ‘profiled’ have some gene increasing your odds of getting a disease you’re at the mercy of the insurance companies.

Perhaps, though, open enrollment could be combined with some type of credit system. Say you’re 24 and in good health. You opt to get insurance but have no claims during the year. Say this goes on for ten years, when you’re 34 you can get credit towards lower premiums because you were a loyal insurance customer during your youth. This would probably require some legislation because to make it work the insurance companies would have to be preprared to cross honor people who carry insurance for years from different companes.

The mandate idea, though, is something that would be interesting to test. It’s one of those stories that sounds quite logical but I’m not sure it mirrors reality. Do people really forgo coverage multiplying the odds of getting sick times the expected cost of getting sick compared to the premiums? Or do most who don’t carry insurance simply aren’t offered it or find it very expensive. If it’s the latter you may be able to drop the mandate without having too many problems with people gaming the system.Report
- Trumwill in reply to Boonton says:
  
  February 5, 2011 at 4:01 pm
  
  Boonton, the problem with “pay for play” is… you’re still pricing a whole lot of people out of the insurance market indefinitely. It would be a great idea in a society that were sufficiently forward-thinking.
  
  Or do most who don’t carry insurance simply aren’t offered it or find it very expensive.
  
  Expense is a big part of it. But not in the sense that it’s expensive because the insurance companies are mean or they have a PEC, but expensive in the more unavoidable way… health care is (or can be) expensive.
  
  It’s also difficult to overestimate the simple inertia factor when it comes to young and healthy people. They’re young and healthy and by and large don’t need to worry about it. Their reward for getting insurance is… money out of their pocket for something they don’t immediately need (especially if it’s something they can get down the line). In that circumstances, it’s awfully tempting to put it off indefinitely. Not due to a calculation, but just inertia.Report
greginak says:

February 5, 2011 at 4:32 pm

Well i noted the McCaskill plan as well as pol in oregon who had another spin a way to get rid of the mandate while lessening the free rider risk. My only point was to highlight that most Repub and Con’s don’t give a crap about freedom. If they did they would be working with one of the ideas. They want a wedge issue. Having been through seemingly endless HCR discussions it seems like too many opponents of HCR are just opposed to the very idea, pre-existing conditions issues and people without insurance be damned. Universal health care is European or sohulist or some such crap.Report
BlaiseP says:

February 6, 2011 at 7:51 am

Let S be a spectrum analysis series of every diagnosed condition combined with the number of such cases. Inversely sort S such that the most-common conditions will appear to the left. Lots of little kids with earaches, that sort of thing.

Do you know we do not have those numbers, statistically, in the USA? The health insurance industry closely guards those numbers. We can only infer them from CDC and some hospital data.

The vast majority of these common conditions can be treated for pennies, but because the doctors must contend with the overhead of extracting payment from health insurers, costs remain high. A single-payer system would solve this problem immediately. Instituting free clinics is the cheapest and most cost-controllable tactic to treat them.Report