By Steve Mintz on November 22, 2013
What should we make of the ethics of the Affordable Care Act? In evaluating President Obama’s signature legislation, we need to consider if the the ends of having universal coverage justify the means of forcing people to obtain coverage. Here are some of the means used to accomplish the goal of health insurance for all Americans:
• Mandating coverage for individuals even if they want to exercise their right not to buy insurance.
• Mandating coverage for all businesses with 50 employees or more even if they want to exercise their right not to provide such insurance.
• Imposing a penalty on those who do not enroll.
• Delegating the power to collect such a penalty to an inefficient agency, the IRS.
• Forcing people into one of the plans sold through insurance exchanges that might offer less coverage than a person currently has and/or higher deductibles.
Other considerations in evaluating the ethics of mandatory health insurance include:
• Subsidies will be provided to those who qualify, further taxing the U.S. Treasury at a time when our national debt is out of control.
• Relying on the honesty of enrollees in providing the information that qualifies them for subsidies.
• Relying on a system to monitor compliance that has proven over time to be broken and overly bureaucratic, not to mention headed by incompetent people.
• Creating a system that is ripe for fraud.
There are other factors I could list. The one that irks me the most is that Congress banned the IRS from using any of its usual techniques to force people to pay the penalty for failing to obtain health insurance. In other words, if you don’t voluntarily pay the penalty it’s unlikely the IRS will come knocking at your door. The only way to monitor payment of the penalty is when a person gets a tax refund and the penalty could potentially be deducted from the refund.
To be fair, there are benefits of Obamacare, not the least of which are coverage for people with pre-existing conditions and no lifetime cap. It seems somehow un-American to turn someone down from what could be a financially devastating occurrence without the help of insurance coverage. After all, we are supposed to be the caring society that treats others the way we want to be treated.
However, I believe the most ethical approach in these instances is for those with high-risk, pre-existing conditions to pay a higher premium than a person in the same plan acquired through an insurance exchange. It’s right to charge at-risk patients more than those who are healthy. We do this with car insurance all the time.
We also need to remember that many people do not need to enroll in an insurance exchange if, for example, they already are covered under Medicare. These people may be the most at-risk patients and the most costly to treat, so it’s good that they have coverage without the need for enrolling in the exchange.
The bottom line is that the various government agencies that run this country have proven, over the years, to be inefficient, incompetent, and ripe for fraud. The National Security Agency doesn’t seem to know the extent of its own spying. I mean, Angela Merkel — really?
Both the IRS and the U.S. General Services Administration have been caught squandering taxpayer money on lavish trips, parties and Star Trek spoofs. Medicare has more fraud ingrained in the system than occurred in the Enron scandal.
I’m not confident that we can rely on a government to implement and monitor the new health care law when it can’t run its own shop. It is alarming to think what will happen when the other shoe falls and the net costs to administer and monitor the system far exceed the overly-excessive estimates of new revenues into the government from Obamacare.
• Steven Mintz is a professor in the Orfalea College of Business at Cal Poly San Luis Obispo. He writes an ethics blog at www.ethicssage.com.