On August 3rd, Missouri voters passed Proposition C with over 70% of the vote. That was a mistake, and now Missourians will literally pay the consequences.
Proposition C reads as follows:
Shall the Missouri Statutes be amended to:
-Deny the government authority to penalize citizens for refusing to purchase private health insurance or infringe upon the right to offer or accept direct payment for lawful health care services?
-Modify laws regarding the liquidation of certain domestic insurance companies?
It is estimated this proposal will have no immediate costs or savings to state or local governmental entities. However, because of the uncertain interaction of the proposal with implementation of the federal Patient Protection and Affordable Care Act, future costs to state governmental entities are unknown.
Yes – For the Proposition
No – Against the Proposition
Supporters of Proposition C presented it as a referendum on the recently passed Patient Protection and Affordable Care Act, or health care reform. In reality, it only addressed a component of health care reform – the individual mandate.
The individual mandate is one of the least popular components of health care reform. It makes it a legal requirement that every American purchase health insurance (federal subsidies are available for those who cannot afford to do so). However, it is an important foundation for most of the popular components of reform.
For example, health care reform makes it illegal for an insurance company to drop or deny coverage to individuals with pre-existing conditions. In other words, people will not lose their health insurance just for getting sick. This is a provision that most people across the ideological spectrum agree with. It also doesn’t work without the individual mandate.
Suppose Proposition C actually went into effect. Health insurance companies would still be required to provide coverage for people with pre-existing conditions, but Missourians would no longer be required to purchase insurance.
To understand why this is a problem, imagine a similar scenario in the car insurance industry. What if drivers were not required to purchase car insurance, but insurance companies could not deny coverage to anyone, even if someone were to apply for insurance the day after being in a car accident? People would take advantage of the system, waiting until they had a car accident to purchase car insurance. Similarly, if Proposition C were to go into effect, people would simply wait until they got sick to purchase health insurance.
All forms of insurance work the same way. A large pool of people pays into the system, covering each individual’s risk. This works well for health insurance if enough healthy people pay into the system to cover the costs of those who become sick. As the proportion of sick to healthy people in the insurance pool rises, the average risk for each individual in the pool rises, and costs go up. If people wait to purchase health insurance until they get sick, 100% of the people in the pool will be sick. The result is astronomically high premiums – the kind that the Missouri Hospital Association warned of as it encouraged Missourians to vote No on Proposition C.
Fortunately, Proposition C will probably be struck down in the courts due to the supremacy of federal law over state law. Still, the costs of Proposition C will be high. It forces the state of Missouri to go to court with the federal government, wasting countless state resources on court costs.
In the mean time, we are left to wonder why Republicans have been so supportive of Proposition C. Disagreeing with health care reform is one thing, but putting a reckless proposition on the ballot that could cause Missourians’ premiums to skyrocket, just to score some cheap political points? Disgraceful.
To find out about the upcoming elections and how to register to vote, visit www.sludems.com
