Fact Sheet

Myths About the Individual Mandate

February 18, 2008 |

Requiring individuals to purchase health insurance -- the so-called “individual mandate” -- is the subject of much debate. In its latest fact sheet, the Health Policy Program addresses some of the most popular myths about an individual mandate and explains why requiring individuals to purchase health insurance is a necessary component of any plan that seeks to cover all Americans.

  • Myth: If individuals choose to be uninsured, there are no consequences to society.

    Fact: The uninsured increase the price of premiums for the insured and drive uncompensated care costs that taxpayers and health care providers must absorb. They place undue strain on Emergency Departments and other sources of care that impact all of us.

  • Myth: An individual mandate would force families to forgo other necessities in order to buy health insurance.

    Fact: All existing mandate-centered reform plans include subsidies for low-income people to ensure affordability, and insurance reforms to make health insurance markets work for all Americans.

  • Myth: An individual mandate is not enforceable.

    Fact: Switzerland and the Netherlands have successfully enforced an individual mandate to purchase health insurance. Similarly, some American states have achieved close to 100 percent compliance with a mandate to purchase car insurance.

  • Myth: An individual mandate is not necessary to ensure that all Americans have health insurance coverage.

    Fact: Many Americans who are eligible for public insurance at little to no cost do not enroll, while others who could afford private health insurance choose not to buy. This suggests a mandate is necessary to approach 100 percent enrollment.

  • Myth: An individual mandate will stifle market competition.

    Fact: An individual mandate, coupled with insurance market reforms and subsidies, would make markets work more effectively and efficiently. By reducing the risk of adverse selection, an individual mandate would force insurers to compete based on price and quality, not underwriting and marketing.

For the full text of the fact sheet, please see the PDF attached below.

Issues:
An individual mandate, coupled with low-income subsidies and insurance market reforms, is a necessary component of any proposal that seeks to cover all Americans.

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