The Health Care Conversation

Here's a recent conversation I had with a Facebook friend who is positively apoplectic about the Supreme Court's decision on health care. I thought I would copy and past some portions of it as it speaks to some of the comments I have received here thus far. His comments are in blue.

Mark, you're missing the point. The Court didn't say that Congress has the power to tax people for not buying insurance because insurance is important and necessary. The Court said Congress can simply tax people for not doing whatever Congress wants them to do. The point is that if Congress can tax us for not having insurance, it can tax us for not exercising or not eating enough green vegetables.

 I disagree. In looking at the brief, it's very clear throughout the entire opinion that this ties to health care and shared responsibility. For example, 


A tax on going without health insurance does not fall within any recognized category of direct tax. It is not a capitation. Capitations are taxes paid by every person, “without regard to property, profession, or any other circumstance.”  The whole point of the shared responsibility payment is that it is triggered by specific circumstances—earning a certain amount of income but not obtaining health insurance. The payment is also plainly not a tax on the ownership of land or personal property. The shared responsibility payment is thus not a direct tax that must be apportioned among the several States.


To me, this says that the health care market is unique and sets up a precedent that Congress cannot tax people for not doing whatever it is they want them to do. Roberts details that further. 


Congress’s ability to use its taxing power to influence conduct is not without limits. A few of our cases policed these limits aggressively, invalidating punitive exactions obviously designed to regulate behavior otherwise regarded at the time as beyond federal authority.


And the fact that everyone should have decent health care doesn't give Congress or the Court the right to trample to trample the Constitution and invent new powers for Congress to achieve a desired end. I agree that those who benefit from receiving health care should pay for it. But that doesn't mean that the federal government, having gotten in the business of providing and paying for health care, has broad power to compel people to buy health insurance.


From the brief... 


None of this is to say that payment is not intended to induce the purchase of health insurance. But the mandate need not be read to declare that failing to do so is unlawful. Neither the Affordable Care Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS. And Congress’s choice of language—stating that individuals “shall” obtain insurance or pay a “penalty”—does not require reading §5000A as punishing unlawful conduct.


Further 


The Act, however, bars the IRS from using several of its normal enforcement tools, such as criminal prosecutions and levies. §5000A(g)(2). And some individuals who are subject to the mandate are nonetheless exempt from the penalty—for example, those with income below a certainthreshold and members of Indian tribes. §5000A(e).


So, it's not "broad or new power." In fact, Roberts points out (as does the law), that it is limited power. Roberts also goes to great lengths to point out in the commerce clause section and necessary and proper section that the Constitution does indeed limit the power of the federal government. So, no trampling here certainly. I'd also urge you to read pgs 41-43 of the brief and take note of Roberts reference to Benjamin Franklin's letter to M. Le Roy regarding the Constitution and taxes. 


What if we moved away from an insurance-based model and simply expected that people were going to pay hospital and doctor bills on their own? The cost of healthcare is ridiculously inflated by the comprehensive insurance model, which keeps larding benefits into plans. The government can tax people to put money into a pool available on a means-tested basis for those who can't pay for major health problems. Let people take back ownership for their own health care costs, decisions and priorities. 


The issue I have here is inelastic demand. If services and products were directly available to the public without insurance in the way, what's to stop the supplier from charging a high price. In many health care markets, demand is inelastic because people aren't going to leave the market when the price goes up. The suppliers will know that they have their customers trapped and will undoubtedly act to increase profit. So, these markets would not allocate resources efficiently and consumer surplus would erode. Believe me, I'd love to remove insurance from the equation. My wife and I pay nearly 800 dollars a month for our family! But that would lead to higher prices unless the government got involved and put price controls in place. That also would be detrimental as it would erode market efficiency. 


Don't forget that the Democratic Congress and the Administration argued loudly and repeatedly that revenue in re: the individual mandate was NOT a tax. The Court has declared that it is, so therefore it is constitutional. It's bizarro-world. Again, what practical limits are there now on Congress' power to force people to do whatever it happens to decide is in the people's best interest?


These practical limits are pointed out extensively in the brief as I have listed above. You and I have different sensitivities when it comes to the federal government so we will likely have to agree to disagree here. My hope is that you take some solace in Roberts' words, though:) 


Enumerated powers is effectively a dead doctrine, and now the federal government can do anything that the constitution and Court precedent have not explicitly forbidden. Think about that, and what that might mean when a political party and/or President you don't like get back in power.


Well, this speaks to our differing views on government. Yes, government is indeed bigger today but so is the private sector. I don't see a problem with that. We have a 15 trillion dollar economy and a global marketplace that is in a constant state of change every single day. In my view, having less government in light of these facts (and regardless of who is in power), would be detrimental.


That's it so far. Likely the conversation will continue...