Thursday, March 29, 2012
By Ezra Klein - March 28, 2012
Bloomberg on line
Of all the arguments being waged over the Affordable Care Act -- or, as the Obama campaign now likes to refer to it, “Obamacare” -- the one dominating the Supreme Court this week is perhaps the most conceptually trivial.
The individual mandate requires consumers to purchase health insurance in order to eliminate the problem of free riders -- people who don’t purchase insurance until the point when they get sick or injured, or never purchase insurance and end up passing the costs of care they can’t afford onto the rest of us. Detractors argue that it unconstitutionally infringes on personal liberty by forcing Americans to purchase health insurance. But compare it to three ways of addressing the free- rider problem in health care that are clearly, indisputably, constitutional:
-- Single payer: The federal government increases income taxes and, in return, guarantees everyone government-provided health-care insurance. There is no option to opt out of the taxes. This is how most of Medicare works, though the insurance only kicks in after you turn 65.
-- Late-enrollment penalty: The single-payer approach only holds for “most of” Medicare because the Medicare Prescription Drug Benefit works a bit differently. For every month that you don’t enroll after becoming eligible at age 65, your premium rises by one percentage point.
-- Tax credits: Under various health-care proposals -- including the plan of Republican Representative Paul Ryan of Wisconsin -- the tax code is changed to give families a tax credit for purchasing private health insurance. Families that chose to go without insurance, or simply can’t afford it, would not receive the tax credit.
Click here to read more Ezra.