Healthcare reform needs more work

January 29, 2011 Commentary Print Print
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Despite the many useful reforms the recently passed healthcare bill includes, it is fundamentally flawed in that it forces individuals to buy and maintain insurance.

Of course, there are many arguments in favor of President Barack Obama’s healthcare reform.

Strong among them are the provisions to eliminate refusal of coverage for pre-existing conditions, and the provision allowing children to remain on their parents’ insurance up to age 26.

 

Another strong point is the closing of the Medicare “doughnut hole,” a gap that denies coverage to anyone whose drug expenses fall within a certain range.

These provisions make the bill strong, it’s true; however, nothing in the bill can make up for the penalties it would impose on anyone who does not have or obtain health insurance.

The government is allowed quite a bit of latitude by the Constitution.

It can raise and fund a standing army, enact and enforce taxes to support its operation, and make decisions relating to overall public welfare.

But nowhere is there a precedent, law, or constitutional amendment giving the government power over individual economic choices.

Under the new healthcare reforms, individuals who fail to obtain healthcare face tax penalties.

No matter how well constructed the reforms are, or how many useful provisions they hold, this boils down to the government having the power to penalize its citizens for choosing not to buy a product.

The argument for the penalties runs something like this: all individuals who don’t have health insurance create a burden on the system when they incur healthcare costs.

Tax penalties would cover those costs, while encouraging the individual to fix the issue by obtaining healthcare.

But that doesn’t make sense. Individuals and businesses incur many of those same debts and taxpayer burdens when they declare bankruptcy.

If the government created a mandatory insurance subsidy to prevent or control bankruptcies, it would be decried as government interference with an individual’s right to economic freedom.

The mortgage system has been shown in the past few years to be spectacularly flawed.

If the government stepped in and established a subsidy program to prevent defaults and crashes, that might be a good thing.

But if the program were mandatory for every mortgage holder, and came with tax penalties for non-enrollment, there would be screams of “nationalization,” and government interference in the free market.

The healthcare reforms are a good thing. Like any bill, there are advantages and problems.

But while everything else within this bill can be repaired or altered, the mandatory enrollment has to be dropped.

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