Fact Checked

What is a Health Insurance Mandate?

Toni Henthorn
Toni Henthorn

A health insurance mandate is a compulsory requirement that forces health care consumers, insurance companies, health care providers, and employers to provide or participate in health care coverage. The individual health care mandate in the United States calls for each citizen to buy or obtain health insurance to cover his health care expenditures. The Patient Protection and Affordable Care Act (PPACA) enacted by the United States Congress in 2010 also compels companies with more than 50 employees to provide adequate health care coverage for their workers. Furthermore, state and federal mandates direct and extend the benefits in the individual policies to include a range of provider types, covered services, and patient categories, some of which had not been covered before PPACA was passed. Patient advocates, consumer groups, and vendors commend the health insurance mandate as a way to ensure comprehensive, nondiscriminatory care for all citizens while opponents criticize the additional costs that health care mandates can impose.

Although the health insurance mandate has increasingly become a fixture in state and federal health insurance regulations, it is also a contentious issue. Supporters of mandates argue they increase the quality and scope of health care coverage. Patients with such health issues as infertility, mental disorders, developmental delays, and substance abuse problems have received essential care for these conditions where, before mandates, they may not have had covered benefits. Health insurance companies can no longer refuse coverage for pre-existing conditions, set lifetime caps on personal health expenditures, or establish discriminatory pricing of policies based on gender, age, health, or lifestyle risk factors. In addition, mandates also help to defray the burdensome costs of unreimbursed emergency room care for uninsured patients who have conditions that lower-cost preventative care could have avoided.

Health insurance.
Health insurance.

Opponents of the health insurance mandate argue that nearly every health insurance mandate ultimately increases the cost of an insurance policy. Depending on the structure of a mandate, it can increase the premium for a health care policy between one and five percent per mandate. Special interest groups, providers, and vendors all lobby lawmakers to include or exclude a given benefit or service, and as they do, the basic health insurance package often becomes expanded to include such benefits as breast reduction, contraception, erectile dysfunction drugs, chiropractic care, and abortion. Since every citizen under the regulations of PPACA must pay for a policy that covers every mandated basic service, each policyholder ultimately pays for services that he does not need or want. Those who oppose these mandates argue they still shift the costs of unreimbursed health care to current insurance consumers by requiring that everyone pay for coverage for services that some will never use.

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