Vice President for Health Policy
The House plans to vote tomorrow on a one-year delay of the health reform requirement that individuals have health coverage or face a penalty. Given the many misleading statements that some critics have made about the “individual mandate,” it’s worth repeating some basic facts:
The Urban Institute estimates that only 7 percent of people under age 65 will have to buy coverage or face a penalty. The Congressional Budget Office estimates that less than 2 percent of the population will actually pay the penalty in 2016.
But it’s impossible to end those practices unless almost everyone is covered. That’s because without an individual mandate, these reforms would make health care coverage less affordable by enabling older and sicker people (who largely have been shut out of the individual insurance market) to buy coverage while allowing healthier uninsured people to wait until they got sick to buy it. The pool of people with coverage would get older and sicker, on average, so premiums would go up. These premium hikes would lead some healthier people to cancel their coverage, which would raise premiums still higher, and so on.
As the Urban Institute concludes, the individual mandate will lead to “lower premiums and more stable insurance markets.”