Health Insurance | How Democrats Learned To Love The Health Insurance Mandate

February 2, 2011 – 1:31 am

Federal Judge Roger Vinson has ruled that the Patient Protection and Affordable Care Act (aka, ObamaCare) is unconstitutional, clearly posing a threat to the Democrats’ effort to radically reform the U.S. health care system.

The key provision that led 26 states”plus others in separate suits”to challenge the law is the health insurance mandate that requires people to have health coverage or pay a fine.

The irony here is sweet. That’s because most Democrats historically haven’t been big supporters of the mandate. As a presidential candidate Barack Obama even campaigned against it. Democrats’ real goal over the years has been to require health insurers to accept anyone who applies for coverage regardless of a medical condition, known as “guaranteed issue.”

For example, Democrats played the leading role the last time the country had a major health care reform debate, in the mid-1990s. Eight states”New Jersey, New York, Vermont, Massachusetts, New Hampshire, Maine, Washington and Kentucky”inspired by the Clinton health care reform effort, passed legislation intended to improve access to coverage in the individual (i.e., non-group) market. But none of those state reforms included a mandate to have coverage; the key ingredient was guaranteed issue, along with a form of price controls that required insurers to charge everyone the same premium.

Why? Because most Democrats have long believed that health insurance should accept anyone who applies. Period.

That’s the way Medicare works. If you qualify by turning 65 you get covered even if you need immediate surgery. To put it another way, most Democrats see health coverage as “social insurance,” not “real insurance,” like life and auto coverage.

Lots of us warned at the time that guaranteed issue would create a “death spiral” in the individual market. As the uninsured with serious medical conditions applied for coverage, premiums would begin to rise for everyone. Those increases would drive out young, healthy people who didn’t have much money and didn’t think anything would ever happen to them anyway.

As they began to drop coverage”secure in the knowledge they could come back anytime and would be accepted”the pool would get smaller and sicker, and premiums would rise even more.

The warnings proved accurate; health insurance premiums in those eight states exploded. As a result, Kentucky eventually dropped guaranteed issue and some of the other states modified their statutes.

The primary reason Democrats embraced the health insurance mandate in ObamaCare was to keep people from gaming the system by remaining uninsured until a medical condition developed. Plus the health insurance industry demanded it be included as a condition of its support.

By contrast several key

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