Buy Insurance or Else?: Resurrecting the Individual Mandate at the State Level

Abstract

The Affordable Care Act (ACA) has been subject to considerable volatility, with perhaps the greatest blow being the rescission, as part of the 2017 Tax Cuts and Jobs Act, of the penalty for its individual mandate to have health insurance coverage. As a New Republic article noted, "we will now find out whether or not an individual mandate really is essential to health reform. And that will settle an old intra-Democratic fight that has been dormant for a decade." The author, Joel Dodge, noted that in the face of Republican efforts to repeal the ACA, "Obamacare defenders (myself included) rebutted these attacks by doubling down on the argument that the law’s entire structure would collapse without a mandate." Yet, following the mandate’s repeal, Dodge admitted: The mandate was also never much of a mandate to begin with. The Obama administration gave numerous exemptions from the mandate for hardship and other life circumstances. And at just $695 or 2.5 percent of household income, the mandate's penalty for going without insurance costs far less than the cost of actually buying insurance. In contrast, in Massachusetts, the state that pioneered health care reform, the penalty for going uninsured, when one is deemed to be able to afford coverage, is "50 per cent of the minimum insurance premium for creditable coverage available through the commonwealth health insurance connector for which the individual would have qualified during the previous year." As one national policy magazine noted, after the individual mandate was repealed, many Democratic legislators expressed support for enacting it in their states, but those efforts mostly faltered: "Health policy experts attribute the waning enthusiasm to the unpopularity of the individual mandate." This article traces the origin of the individual mandate, chronicles the efforts of some states to enact their own mandates, and concludes by questioning whether the mandate is either necessary or politic.