NPR

Republicans Spurn Once-Favored Health Mandate

Orrin Hatch of Utah is one of four Republican lawmakers still in the Senate who supported a 1993 GOP bill requiring an "individual mandate." (Getty Images)

For Republicans, the idea of requiring every American to have health insurance is one of the most abhorrent provisions of the Democrats' health overhaul bills.

"Congress has never crossed the line between regulating what people choose to do and ordering them to do it," said Sen. Orrin Hatch (R-UT). "The difference between regulating and requiring is liberty."

But Hatch's opposition is ironic, or some would say, politically motivated. The last time Congress debated a health overhaul, when Bill Clinton was president, Hatch and several other senators who now oppose the so-called individual mandate actually supported a bill that would have required it.

In fact, says Len Nichols of the New America Foundation, the individual mandate was originally a Republican idea. "It was invented by Mark Pauly to give to George Bush Sr. back in the day, as a competition to the employer mandate focus of the Democrats at the time."

The 'Free-Rider Effect'

Pauly, a conservative health economist at the University of Pennsylvania's Wharton School, says it wasn't just his idea. Back in the late 1980s — when Democrats were pushing not just a requirement for employers to provide insurance, but also the possibility of a government-sponsored single-payer system — "a group of economists and health policy people, market-oriented, sat down and said, 'Let's see if we can come up with a health reform proposal that would preserve a role for markets but would also achieve universal coverage.' "

The idea of the individual mandate was about the only logical way to get there, Pauly says. That's because even with the most generous subsidies or enticements, "there would always be some Evel Knievels of health insurance, who would decline coverage even if the subsidies were very generous, and even if they could afford it, quote unquote, so if you really wanted to close the gap, that's the step you'd have to take."

One reason the individual mandate appealed to conservatives is because it called for individual responsibility to address what economists call the "free-rider effect." That's the fact that if a person is in an accident or comes down with a dread disease, that person is going to get medical care, and someone is going to pay for it.

"We called this responsible national health insurance," says Pauly. "There was a kind of an ethical and moral support for the notion that people shouldn't be allowed to free-ride on the charity of fellow citizens."

Republican, Democratic Bills Strikingly Similar

So while President Clinton was pushing for employers to cover their workers in his 1993 bill, John Chafee of Rhode Island, along with 20 other GOP senators and Rep. Bill Thomas of California, introduced legislation that instead featured an individual mandate. Four of those Republican co-sponsors — Hatch, Charles Grassley of Iowa, Robert Bennett of Utah and Christopher Bond of Missouri — remain in the Senate today.

The GOP's 1993 measure included some features Republicans still want Democrats to consider, including damage award caps for medical malpractice lawsuits.

But the summary of the Republican bill from the Clinton era and the Democratic bills that passed the House and Senate over the past few months are startlingly alike.

Beyond the requirement that everyone have insurance, both call for purchasing pools and standardized insurance plans. Both call for a ban on insurers denying coverage or raising premiums because a person has been sick in the past. Both even call for increased federal research into the effectiveness of medical treatments — something else that used to have strong bipartisan support, but that Republicans have been backing away from recently.

'A Sad Testament'

Nichols, of the New America Foundation, says he's depressed that so many issues that used to be part of the Republican health agenda are now being rejected by Republican leaders and most of the rank and file. "I think it's a sad testament to the state of relations among the parties that they've gotten to this point," he said.

And how does economist Pauly feel about the GOP's retreat from the individual mandate they used to promote? "That's not something that makes me particularly happy," he says.

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Transcript

RENEE MONTAGNE, host:

And when it comes to health care bill, one of the biggest issues dividing Democrats and Republicans, is whether everyone should be required to have health insurance. Most Democrats say they should, Republicans disagree.

But as NPRs Julie Rovner reports, that wasnt always the case.

JULIE ROVNER: For months now, Republicans have been hammering away at the proposed requirement that every American have health insurance. Here was Utah Republican Orrin Hatch, during the Senate floor debate in December.

Senator ORRIN HATCH (Republican, Utah): Congress has never crossed the line between regulating what people choose to do and ordering them to do it. The difference between regulating and requiring is liberty.

ROVNER: And here is Iowas Chuck Grassley during the Senate Finance Committees consideration of the measure, last fall.

Senator CHUCK GRASSLEY (Republican, Iowa): For the first time in the history of our country - 225 years - the federal government saying, you have got to buy something. Thats never been before.

ROVNER: Their opposition to making health insurance mandatory, however, is ironic. The last time a major health overhaul was debated when Bill Clinton was president, the Republican alternative bill featured the exact requirement both senators are now berating, and both Hatch and Grassley were co-sponsors of that bill. So whats changed since then: politics, mostly.

Len Nichols of the New America Foundation says the individual mandate was actually created by Republicans and only later embraced by Democrats.

Dr. LEN NICHOLS (Health Policy Program, New America Foundation): It was invented by Mark Pauly to give to George Bush, Senior, back in the day, as a competition for the employer mandate focus of the Democrats at the time.

ROVNER: He is referring to health economist Mark Pauly of the Wharton School at the University of Pennsylvania. Pauly says it wasnt him alone, he was actually part of a small group of conservative health economists and lawyers who cooked up the idea in the late 1980s.

Dr. MARK PAULY (Chairman, Health Care Systems Department, Wharton School): In some ways it was kind of like a Judy Garland/Mickey Rooney movie.

ROVNER: Except instead of putting on a show...

Dr. PAULY: A group of economists and health policy people, market-oriented, sat down and said, let's see if we can come up with a health reform proposal that would preserve a role for markets, but would also achieve universal coverage. And I think the individual mandate was derived, mostly, from the power of logic.

ROVNER: That logic being that even the most generous subsidies or enticements, he says, could only get you so far.

Dr. PAULY: There'd always be some Evel Knievels of health insurance, who would decline coverage, even if the subsidies were very generous, even if they could afford it, quote unquote, "if you really wanted to close the gap, that's the step you would have to take."

ROVNER: Now one of the key justifications for requiring everyone to have at least catastrophic health insurance is what economists call the Free-Rider Effect. If you're in an accident or you come down with a dread disease, you're going to get taken to the hospital and someone's going to pay. And that was something that appealed to Republicans, at least back then, says Pauly.

Dr. PAULY: We called this responsible national health insurance, so there was a kind of an ethical and moral support for the notion that people shouldn't be allowed to free-ride on the charity of their fellow citizens.

ROVNER: Now the Republican bill introduced in 1993 did differ in some substantial ways from the bills now pending in Congress. For example, that bill included caps on damage awards in medical practice lawsuits, which the Democrats' bills dont.

But the bills also have tremendous amounts in common. The Republican bill from 1993 also called for purchasing cooperatives, similar to the Democrats' health exchanges. And the Republican bills even propose to boost federal research on how effective medical interventions are; thats another effort Republicans have recently criticized.

Len Nichols, of the New America Foundation, says he's depressed that so many issues that used to be part of the Republican health agenda are now being rejected by Republican leaders and most of the rank and file.

Dr. NICHOLS: I think it really is a sad testament to the state of relations among the parties that they've gotten to this point.

And how does economist Pauly feel about the GOP's retreat from the individual mandate they used to promote?

Dr. PAULY: That's not something that makes me particularly happy.

ROVNER: Nor, does it make happy, those who are still hoping for a bipartisan solution to the health care problem.

Julie Rovner, NPR News, Washington.

MONTAGNE: You're listening to MORNING EDITION from NPR News. Transcript provided by NPR, Copyright NPR.

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