Religious Objection Not the Only Problem With Obamacare Contraception Mandate
By Paul Theroux • Saturday February 11, 2012 1:42 PM PDT • 14 Comments
A debate in the media is currently swirling around the objection of Catholic and other religious institutions to a new requirement to pay for insurance plans that cover contraception for their employees. However, this narrow focus has obscured the larger problem of government insurance mandates in general.
One of the primary justifications for the Obamacare (and Romneycare) individual mandate is that there is a “free-rider” problem: people without insurance get into an accident and get brought into the emergency room. The hospital treats them and ends up eating the cost. Therefore, the argument goes, individuals need to be mandated to have insurance to cover these costs. However, the main reason so many people don’t have health insurance in the first place is because it’s too expensive. Why? Because the government has made affordable health insurance illegal.
Many people—especially young healthy people—really only want an insurance plan that covers “catastrophic” costs: if they get cancer, or are in an accident, etc. However, the government likes to pretend to be compassionate by mandating on both the state and federal level that health insurance pay for all kinds of elective or routine expenses: acupuncture, substance abuse treatment, wigs and hairpieces, contact lenses, in vitro fertilization, chiropractors, mammograms, etc. There is nothing necessarily wrong with any of these treatments, but it is a problem when the government requires every plan to pay for these things when many people would rather have less expensive, less comprehensive plans. These mandates make insurance less affordable. If the “free-rider” emergency room situation is the argument for the individual mandate, why would the government mandate that everyone’s insurance cover all sorts of treatments and procedures that have nothing to do with emergency room care?
The new contraception rule will make the cost problem worse. What about people who are not sexually active, don’t believe in contraception, or would rather pay for it out of their own pocket, rather than through insurance? They will have no choice now but to pay higher premiums, or go without insurance entirely. If the insurance is through their job, the employers will be faced with the higher premiums and will either drop coverage or pay the higher premiums at the expense of lower wages.
Demonstrating that they have completely crossed into fantasyland, the administration argues that this regulation will not result in higher costs to anyone. Contraception is a multi-billion dollar a year industry, yet we are supposed to believe these costs will be completely invisible? They argue that the savings from covering fewer childbirths will more than offset the extra expense of handing out free birth control. If that is true, why doesn’t health insurance already cover free birth control? Their argument makes no sense on even the most basic level.
To enforce the silly expectation that premiums won’t rise, the government will likely try to use price controls to prevent insurance companies from raising premiums. The inevitable result will be that insurance companies will look to cut costs in other ways that will be even more harmful to their customers, or they will get out of the health insurance business entirely, further reducing choice and competition in the marketplace.
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Update: Peter Schiff has posted a video blog on this issue making some of the same points, as well as several other good points.
Tags: Healthcare, Politics, Price control, Regulation, Religion 
Makes sense to me. thanks.
richard | Feb 12, 2012 | Reply
While it is true that mandates raise the price of health insurance, I suspect that other forms of government intervention (licensing, FDA regulation, the patent system, etc.) are to a great extent responsible for the high prices of any given treatment or other utilization. If the latter type of intervention was drastically curtailed, we would find that most health care could be paid for out of pocket and that little insurance was even necessary.
D. Saul Weiner | Feb 12, 2012 | Reply
I am not sure that I entirely concur. You need uniformity of benefits at some level to assure an even spread of insurance risk. The more volatility you add to the mix by giving choices, low or intermediate service models for example, the more difficult you make it to correctly price a product. It strikes me that there are other significant drivers of health care cost such as poverty, litigation risk, fraud that should clearly be addressed without compromising access to a broad array of necessary medical services.
Stephen R. Sottile | Feb 13, 2012 | Reply
As usual, Peter Schiff nails it top to bottom. Great video.
Speedmaster | Feb 13, 2012 | Reply
Not cover mammograms? Then why not cut out prostate exams as well? No contraceptive cover? Do you not realise that a woman has to have a pap test to get the pill or other other contraception, thus checking for cancer? I suggest then, we also stop Viagra and similar drugs for men who want an erection- not being able to get one is not life threatening. Even that Pos-t vac device is available through insurance providers. I agree with a lot of what you say, but I feel you’ve overlooked some important realities.
Dawn Hutchinson | Feb 13, 2012 | Reply
Dawn, it is not a question of you or me or anyone else deciding what should be “cut” or “stopped”. The point is that the decision about what treatments are covered should be made by the policyholder at the time they buy the coverage. Just like when we buy auto insurance, we weigh the costs and benefits and decide whether or not it is worth getting coverage for collision, theft, towing, bodily injury liability, etc.
Paul Theroux | Feb 13, 2012 | Reply
Thank you for clarifying that! I understand what you mean. I’ve always thought that any insurance being mandatory is bound to fail, as you stated, because not everyone can afford it. When I was still employed, the cost of insurance was almost 20% of my take home pay. I recently sold my car, because I couldn’t afford auto insurance, after over a year of being unemployed. I’m using the money ($500) to go back out West to warmer climate. Homeless, no car, soon no phone. Insurance of any kind is not an option, even though I do have health concerns. They have not been addressed since I became unemployed.
Dawn Hutchinson | Feb 13, 2012 | Reply
As always, the process is inflamed by special interests. Here in Arizona last year we had a bill to allow people to buy health insurance out of state. The majority of citizens wanted this, but it was defeated after extensive lobbying from the “special health problems” lobby who had previously lobbied to get their special health problems on the mandatory list for insurance coverage in-state, and who realized that when hordes of people bought cheaper insurance from out of state, they were going to lose their personal slush fund paid for by others.
Henry Bowman | Feb 13, 2012 | Reply
My own experience has been that prescription laws considerably increase the cost of health care for much the same reason as any sort of monopoly increases costs. Without these laws people could take care of their own without so many expensive visits to the doctor. This does require obtaining a certain degree of knowledge, but this is not beyond the ability of anyone willing to learn to take care of their own health.
Jerome Bigge | Feb 13, 2012 | Reply
P T
This is part of the larger issue of attempting to use insurance (the transfer of risk) a risk-spreading mechanism ot serve as a cost-spreading mechanism to(bureucratically)establish a new entitlement (under the guise of an “insurance benefit”) and thus impose obligations on others to provide it through premium charges.
R Richard Schweitzer | Feb 15, 2012 | Reply
It’s high time we examined healthcare as a Second Amendment issue. Just as a rifle aids an individual in defending both himself and the state from attack by a violent lunatic, a syringe full of penecillin defends the sick person, and those he avoids infecting, from attack by hostile microbes.
The fundamental human right of self-defense, ia abdridged by every statute or regulation that denies us the right to self-treatment.
Yet, only the sickest people actually require a professional caregiver to treat them for catastrophic, incapacitating, life-threatening illness.
It as absurd to force someone with acne, to pay $170 for “surgery”, that consists of rubbing zits with medication that costs 10 cents (which the person could do himself). Yet that is precisely how costs have been driven to astronomical levels.
The medical profession wrongfully embraced Statism as a means of increasing profit. We must attack the statist idea at its root, by asserting self-care as an individual right, if we are to return control of care (and spending) to patients.
As for catastrophic-care insurance, its’ availability varies by state. Those states that allow competition between health insurers, have seen remarkable cost cuts, when patients pay for ordinary medical needs out of Health Savings Accounts and catastrophic care from insurance. Don’t plan on that reaching Utah anytime soon: Blue Cross has a monopoly there, and has artificially inflated the price of HSAs and catastrophic care insurance. This denies Utah residents the right of self-defense against disease...but sure makes for some great executive compensation and a lot of PAC money for politicians.
Bob Schubring | Feb 15, 2012 | Reply
Where can I find a listing of SPECIFIC problems with the obamacare program? Where in the bill does it venture from health care provision to subjegate people to rules that infringe on individual rights. For example,does it create tax liabilities through non health care transactions in order to pay for this program. How far does it stray from health care provision through non health care issues. If I sell something like a house, will there be imposed taxes to support obamacare. Where is there a step by step assessment of this bill to find “what it really says and dictates to the average US citizen.” W. Buss, MD
William Buss, MD | Mar 12, 2012 | Reply