Health Insurance Mandate Without Price Control Can Increase Cost


The government is trying to bring affordable health insurance coverage to “almost” every American, but lawmakers are skeptical in trying to limit what insurer's charges and have been rejecting restrictions on how much insurers can charge. This is creating fears that we the consumer will be forced to pay the outrageous health insurance premium increases of recent years.

The legislators' unwillingness to control premium costs comes in the face of the fact that these lawmakers will be requiring that most Americans have some sort of health insurance. This is an extraordinary mandate. It will be the first time that the federal government has required consumers to buy a single industry's product.

"We are about to force at least 30 million people into an insurance market where the sharks are circling," said California Lt. Gov. John Garamendi, a Democrat who served as the state's insurance commissioner for eight years. "Without effective protections, they will be eaten alive."

Skyrocketing premiums along with millions of new customers who will literally be forced to buy policies would mean a much higher cost for taxpayers to cover government subsidies for low income people.

“If the government is going to require people to buy an insurance policy, they have to guarantee it is affordable," states Jamie Court, president of Consumer Watchdog. "It is unconscionable not to." These ever climbing premiums will eventually increase the competition and possibly restrain costs however, it would take a long time and there is no guarantee.


Some of these experts think that an insurance mandate is imperative for a “healthcare overhaul.” With everyone in the system, the nation's medical bill might be able to be spread more largely and this could possibly alleviate pressure on those who have insurance to pay for those who can’t pay. The botom line is that all of the major healthcare bills would penalize people who do not get health insurance.

Democrats seem to be shying away from regulating premiums while the Republicans that controlling what insurers charge would be meddling too much in the private sector.

Lawmakers are not considering any proposals to regulate what doctors; hospitals, drug makers and other healthcare providers charge either. This is a strategy used by some European countries to control healthcare spending.

Senior House Democrats have proposed the most far-reaching government regulation of the insurance industry. Their bill, which is still being debated, seeks to control insurance premiums in part by limiting how much companies can spend on non-medical expenses such as marketing and dividends to shareholders.

The House bill also features a new government insurance program or what is being called "public option" that advocates believe could possibly offer consumers a lower priced alternative to private plans and, in turn, pressure insurers to rein in premiums.

Los Angeles Times
The Associated Press

Written by Tyler Woods Ph.D.
Tucson, Arizona
Exclusive to eMaxHealth