Thursday, March 25, 2010

Health Care Concerns: Interstate Commerce Clause

As far as I can tell, 100% of the non-spamming readers of this site have law degrees. So I need your help with these two questions: does the government really have the power to force people to buy a private insurance plan, and is a tax on the uninsured an overreaching form of discrimination?

I was listening to an interview with the Attorney General of Virginia Ken Cuccinelli on NPR the other day, and his gripes with the new health care law seemed to be well-thought-out and well-articulated (unlike his gripes with homosexuals). Ken Cuccinelli is suing the government because he believes the law is unconstitutional because it compels all citizens to buy a product from a private marketplace. And honestly, I can't immediately think of a private good or service required by all individuals, not just car-owners or house-owners or business-providers.

Another worry of mine about the health care bill is the prospect for the private insurers in the exchanges to jack up prices. They will no longer be allowed to rescind policies or deny policies to people, but as far as I can tell, there's nothing that says they have to provide a policy at a low price. And, like so many Republicans have argued, there is nothing in the health care law to control costs of medical service. So rising insurance premiums will surely keep rising without any market control method of the size that only a government could provide. This was the rationale behind the extinct public option, after all. (Hell, it's the rationale behind single payer coverage too).

It was thought to be the news in California of Anthem Blue Cross's 39% rate hike that steeled the nerves of Democratic lawmakers and helped them finally pass the health care law. But what is the method by which this new law would be able to stop rate hikes like this? Increased competition? There are many health insurers with many plans in California already. It doesn't stop them from raising rates. The market for health insurance contains too much friction for people to be able to switch insurance policies. And because of measures that strengthen employer-based health insurance policies, the health insurance market should continue to operate opaquely.

I don't like the private-insurance-only health care bill, but only time will tell if it makes the country better or worse.