2019 OPEN ENROLLMENT ENDS (most states)
Time: D H M S
This Axios piece by Caitlin Owens is extremely short...a mere 139 words in all...so sticking with a "fair use" quote is tricky, but I'll do my best:
Senate Finance Committee chairman Orrin Hatch says he could support delaying the repeal of the Affordable Care Act's individual mandate for a while, or even indefinitely, as a way to stabilize the marketplaces. "I wouldn't mind" postponing the repeal until after 2020, he told reporters this afternoon. "It all comes down to budgetary concerns and how it's going to be written." And he didn't rule out keeping it even longer:
"I'd like to not have it at all, but you know, it all comes down to, what's the art of the doable?"
Think about this for a moment.
For seven years, the Republican Party has railed against the Individual Mandate with the fury of a thousand suns. Of course, they attacked the ACA as a whole as well, but there was no element of it which made them burn with rage over FREEEEEEDOMMMMMMMMMM!! than the Individual Mandate. It was the battle cry of the Tea Party. It was the basis of the first major anti-Obamacare lawsuit. It's been fueling the Obamacare outrage from the start.
And now, when they hold all the cards and are on the verge of actually repealing the ACA, what have they realized?
Well, the House GOP realized that they have to have some sort of financial penalty/incentive to goad people into signing up...so they replaced the Individual Mandate with their own version of it: A 30% "surcharge" which people would have to pay when they do sign up for an individual market policy if they go more than a short period without being covered.
Yes, it's less effective and at the same time more punitive than the ACA's mandate penalty, but it's still a financial penalty.
And now that they've kicked the ball over to the Senate's side of Congress, suddenly Republican Senators are discovering the same thing: Unless you have some type of stick to poke people with, too many healthy people simply won't bother signing up for coverage, making the risk pool for those who do too sickly, spiking premiums too high.
The truth is, most experts agree that the ACA's mandate penalty ($695/person or 2.5% of your household income) is, quite simply, too weak to be as effective as it needs to be.
In other nations which have an ACA-exchange-like healthcare system, the noncompliance penalty is quite a bit harsher:
In the U.S., we too impose penalties for going without health insurance, which led to an average household pay out in 2016 of $969, according to the Kaiser Family Foundation. Estimates are that 7.1 million people paid the penalty this year for failing to have coverage in 2015.
Still, in Switzerland and other European countries, such as Germany and the Netherlands – as Dr. Reinhardt points out – they take a harder line when it comes to their citizens complying with the requirement to have health insurance.
For example, if after notice from the government, a Swiss citizen fails to sign up for insurance, Swiss cantons – the equivalent of states in the U.S. – can impose a penalty ranging from 30 percent to 50 percent above the cost of insurance premiums. If after three months the uninsured still doesn’t pick a plan, the authorities choose one for them, and allow insurers to sue for unpaid premiums.
This is similar to the AHCA 30% surcharge fee...except that a) it could be more than 30%; b) I presume it's an actual tax paid to the government; and most importantly, c) they will be enrolled in a policy and will pay for it, including the surcharge, whether they like it or not.
The Germans impose hefty fines, that after a multi-step process of late fees, can climb to as much as $12,000. In the Netherlands, after a series of fines go unpaid, a bailiff may come to collect. Then the government may pick a health plan on a citizen’s behalf and deduct the cost of the premium from their pay with the help of their employer. If after six months a citizen still fails to pay, their insurance premiums spike.
It seems to work. Switzerland, for example, has virtually no uninsured citizens, according to a report of international health systems by the Commonwealth Fund. So why don’t we model enforcement of the law’s individual mandate after these other countries?
Robin Osborne, who heads The Commonwealth Fund’s International Health Policy and Practice Innovations Program, says the goal may have been to move the U.S. into the law’s new requirements more gently.
Unfortunately (or fortunately, depending on your POV), I think there's precisely zero percent chance that the ACA's penalty will ever be made any harsher than it currently is. The Democrats lost control of the House of Representatives based in no small part on this issue alone; even if they retook the House and Senate, no matter how many of my other suggestions they take, I find it hard to believe they'd be willing to touch that one again, especially if doing so increased the non-compliance penalty.
Even so, the fact that Republican Senator Orrin Hatch is finally realizing how vital the penalty is says quite a bit about where things stand.