Midwest Voices

Barb Shelly

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Federal Judge Henry E. Hudson of Virginia stated the obvious today in his ruling that the individual insurance mandate in the new health care reform law was unconstitutional.

“The outcome of this case has significant public policy implications,” Hudson wrote. “And the final word will undoubtedly reside with a higher court.”

Undoubtedly. A Michigan judge has already ruled that the insurance mandate was constitutional. More than a dozen lawsuits are floating around out there. Eventually they’ll all filter into a challenge to the Affordable Care Act before the U.S. Supreme Court.

Veering from the legal to the practical, most all health policy experts agree that there’s really no way to ban health insurers from discriminating against people who are older, work in hazardous occupations or have a “preexisting condition” without getting healthy people into the insurance pool. The mandate that everyone purchase insurance or pay a tax penalty was a way to make that happen.

It may not be the only way, however.

Congress might be able to achieve the desired result by creating incentives — and disincentives — that make it more advantageous to purchase health insurance than to go without it.

An example is this idea put forth by Kansas Insurance Commissioner Sandy Praeger:

Consumers would eligible for medical insurance without regard to their health status only as long as they continuously paid into a policy. If they dropped their coverage, they would have to pay a penalty and have their medical history evaluated before resuming coverage. And insurers at that point would have some leeway to raise premiums on the basis of preexisting conditions.

As Praeger has noted, that kind of approach puts the choice on the individual, so it’s no longer a mandate. But there are consequences for dropping coverage.

It’s impossible to predict how the insurance mandate would fare in the Supreme Court. But it’s not too soon to start thinking about fallback positions. And Praeger’s idea is a good place to start.

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