The individual mandate, an idea inspired by conservative intellectuals but ultimately embraced by Democratic lawmakers as an essential part of the Affordable Care Act, will soon be dead. The provision would be eliminated under the tax bill passed on Wednesday.
Left behind would be a policy structure that relied on the mandate to push the young and healthy to buy health insurance and thus strengthen the marketplace for millions of Americans. The Affordable Care Act, which adopted the mandate as a central provision, will remain the law, and President Trump far overstated matters when he said that “we have essentially repealed Obamacare.” But the loss of the mandate — the best-known and least liked part of the health care law — will cause substantial changes.
The magnitude of the consequences is uncertain, but most experts believe the mandate’s elimination will usher in an era of higher insurance prices and lower health coverage rates. The economists at the Congressional Budget Office estimate that as many as 13 million more Americans could become uninsured in 10 years and that insurance premiums will rise by an additional 10 percent each year. The impact won’t start to become clear until 2019, when the provision’s penalties for remaining uninsured officially expire.
The mandate was devised by conservative health care experts at the Heritage Foundation in the late 1980s, who conceived it as a necessary part of a market-based system for providing health insurance in America. The mandate was intended to encourage individual responsibility: More families should be able to choose their own health plans in a market, but they would be expected to have some sort of coverage so they wouldn’t burden their neighbors if they became sick or injured.
“Society does feel a moral obligation to insure that its citizens do not suffer from the unavailability of health care,” Stuart Butler, then Heritage’s director of domestic policy studies, said in a 1989 lecture that was published in a book. “But on the other hand, each household has the obligation, to the extent it is able, to avoid placing demands on society by protecting itself.”
It attracted interest across the political spectrum, becoming a favored policy prescription of some Republicans opposed to President Bill Clinton’s health care overhaul plan in the early 1990s. It was discussed in economics and policy journals. And it later became the basis for a bipartisan health care bill that attracted co-sponsors from both parties but never made it to a vote.