The Heritage Foundation and the Individual Mandate-1
The great irony of the Affordable Care Act, as many have noted, is that it is based on policy proposals made by the conservative Heritage Foundation 20 years ago. Heritage created the plan, including the individual mandate, as a market-bassed alternative to government provided health care. In an excellent article in Forbes online, Avik Roy details the history of the idea, starrting with a bill signed into law by Ronald Reagan:
"It all started with a piece of legislation passed in 1986 by a Democratic House and a Republican Senate and signed by Ronald Reagan, called the Emergency Medical Treatment and Active Labor Act, or EMTALA. (EMTALA was passed as part of a larger budget bill called the Consolidated Omnibus Budget Reconciliation Act, or COBRA, which is best known for allowing those who have lost their jobs to continue buying health insurance through their old employer’s group plan.)
EMTALA, one of the great unfunded mandates in American history, required any hospital participating in Medicare—that is to say, nearly all of them—to provide emergency care to anyone who needs it, including illegal immigrants, regardless of ability to pay. Indeed, EMTALA can be accurately said to have established universal health care in America—with nary a whimper from conservative activists."
Passage of EMTALA gave rise to the notorious "free rider" problem, in which people would intentionally go without health insurance, knowing that federal law required hospitals to care for them anyway.
What's more, as Roy points out, "most proposals for universal health care that were to the right of government-run single-payer were based upon forcing employers to sponsor private-sector health coverage for all of their employees. For example, under the Comprehensive Health Insurance Plan proposed by Richard Nixon in 1974, 'every employer would be required to offer all full-time employees the Comprehensive Health Insurance Plan. Additional benefits could then be added by mutual agreement.' "
"There are five obvious, and large, problems with an employer mandate. The first is that an employer mandate massively drives up the cost of hiring new employees, discouraging new hiring and increasing unemployment. The second is that forcing employers to pay for health costs increases the costs of running a business, and these increased costs are passed onto consumers in the form of higher prices for goods and services.
The third problem is that an employer mandate does nothing to address the health needs of the unemployed. The fourth is that the employer-based system insulates consumers from the value of the health care they are paying for, giving them no incentive to economize, thereby driving up the cost of health insurance. The fifth is that the employer-based system leads to “job lock,” whereby people are afraid to leave their jobs if they fall ill on the job, because switching plans could mean higher premiums or denial of coverage.
Hence, some conservatives, seeking a more market-oriented path to universal coverage, began endorsing an individual mandate over an employer mandate. An individual mandate would address the “free rider” problem caused by EMTALA, by requiring people to buy their own insurance. In addition, moving to a more individual-based system from the employer-based one would significantly increase the efficiency of the health-insurance market.
With these considerations in mind, in 1989, Stuart Butler of the Heritage Foundation proposed a plan he called “Assuring Affordable Health Care for All Americans.” Stuart’s plan included a provision to “mandate all households to obtain adequate insurance,” which he framed explicitly as a way to address the “free rider” problem and employer mandates. Butler wrote:
"Many states now require passengers in automobiles to wear seatbelts for their own protection. Many others require anybody driving a car to have liability insurance. But neither the federal government nor any state requires all households to protect themselves from the potentially catastrophic costs of a serious accident or illness. Under the Heritage plan, there would be such a requirement.:
"This mandate is based on two important principles. First, that health care protection is a responsibility of individuals, not businesses. Thus to the extent that anybody should be required to provide coverage to a family, the household mandate assumes that it is the family that carries the first responsibility. Second, it assumes that there is an implicit contract between households and society, based on the notion that health insurance is not like other forms of insurance protection. If a young man wrecks his Porsche and has not had the foresight to obtain insurance, we may commiserate but society feels no obligation to repair his car. But health care is different. If a man is struck down by a heart attack in the street, Americans will care for him whether or not he has insurance. If we find that he has spent his money on other things rather than insurance, we may be angry but we will not deny him services—even if that means more prudent citizens end up paying the tab.
A mandate on individuals recognizes this implicit contract. Society does feel a moral obligation to insure that its citizens do not suffer from the unavailability of health care. But on the other hand, each household has the obligation, to the extent it is able, to avoid placing demands on society by protecting itself…
A mandate on households certainly would force those with adequate means to obtain insurance protection, which would end the problem of middle-class “free riders” on society’s sense of obligation."
In the early 1990's Congressional Republicans looking for an alternative to Hillary Clinton's government-heavy health care proposal embraced the individual mandate proposed by Heritage:
One such bill, the Health Equity and Access Reform Today Act of 1993, or HEART, was introduced in the Senate by John Chafee (R., R.I.) and co-sponsored by 19 other Senate Republicans, including Christopher Bond, Bob Dole, Chuck Grassley, Orrin Hatch, Richard Lugar, Alan Simpson, and Arlen Specter. Given that there were 43 Republicans in the Senate of the 103rd Congress, these 20 comprised nearly half of the Republican Senate Caucus at that time. The HEART Act proposed health insurance vouchers for low-income individuals, along with an individual mandate.
Newt Gingrich, who was House Minority Leader in 1993, was also in favor of an individual mandate in those days. Gingrich continued to support a federal individual mandate as recently as May of last year."
It would seem that 1990s conservatives weren’t concerned with the constitutional implications of allowing Congress to force people to buy a private product. “I don’t remember that being raised at all,” Mark Pauly told Ezra Klein last year. “The way it was viewed by the Congressional Budget Office in 1994 was, effectively, as a tax…So I’ve been surprised by that argument.”
While Heritage disagrees with Obama's version of the individual mandate, it's hard to deny that the foundation was the driving force behind the idea and that it was the preferred position of Republicans in Congress until Obama endorsed it.