Like my co-conspirators, I believe the Necessary & Proper Clause provides the strongest basis for the constitutionality of the individual mandate. I”m inclined to agree with Ilya nad Randy, rather than Orin, but I believe it’s a close call.
The constitutional argument, as has been rehearsed in this space before, is that that mandate is a “necessary and proper” means of facilitating some of the regulations of health insurance markets contained in the recent health care reform legislation that are themselves constitutional exercises of the commerce power. But is the individual mandate, as enacted, really a “necessary” part of health care reform? I am not so sure.
An individual mandate is intended to mitigate the economic effects of other regulatory measures contained in the health care reform legislation, such as the prohibition on insurers excluding coverage for preexisting conditions, and prevent insurance premium increases due to adverse selection. The fear is that healthy people will rationally decline to purchase coverage until they are sick, and that this will cause health insurance premiums to increase, which will cause more health people to opt out, and so on. By requiring all Americans to purchase health coverage, the mandate prevents adverse selection and keeps healthier (and cheaper to ensure) people in the insurance pools. At least that is how it works in the theory.
A sufficiently stringent individual mandate could well eliminate the adverse selection problem, but that is not what Congress enacted. Instead, Congress enacted a mandate that does not solve the adverse selection problem. For many Americans, the penalty for failing to purchase health insurance will remain substantially below the cost of purchasing a federally approved health insurance policy. This is one of the reasons no one expects health care reform to achieve universal coverage. This is also why the […]