On Sebelius’ & Holder’s Defense of Obamacare

The economic argument for a mandate is unfounded. As a class, the uninsured pay their way, because there are enough high-earning uninsured who pay extra taxes (by taking cash remuneration instead of health benefits) to cover the cost of uncompensated care. If Congress eliminated the employer-based monopoly on health benefits, and gave individuals a tax credit or deduction instead, the IRS could easily calcuate the value of tax credits or deductions that residents of each state did not claim, and transfer those funds to states to pay for uncompensated care. (I wrote a Health Policy Prescription on this a few years back, which I intend to update soon.)

In any case, the fact that hospitals themselves give charity care, or that state and federal governments command it, is not an argument for a mandate. If legislators cannot tolerate the idea that society rely on private, (nominally) religiously affiliated, (nominally) non-profit hospitals to provide uncompensated care, then they should fund the care through a straight tax, plain and simple.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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