Congressional Republicans appear to be moving full speed ahead in repealing the Affordable Care Act’s individual mandate, prompting debate among California health care experts on how the state could continue encouraging residents to buy health insurance — including imposing a state-level requirement to purchase coverage.
The elimination of the individual mandate, which requires people to buy insurance or pay a tax penalty, is included in the GOP tax bill that is expected to reach President Trump’s desk by Christmas. Repealing the mandate is projected to lead to 1.7 million fewer Californians with health insurance over the next decade, with experts predicting that some young, healthy people may choose to drop coverage if it is not required. Under the Affordable Care Act, California has lowered its uninsured rate to a record 7 percent.
“I am committed to protecting those gains,” said State Sen. Ed Hernandez (D-West Covina), chair of the Senate health committee. “All options are on the table if federal enforcement of the individual mandate ends.”
California, which moved more quickly and agressively than most states in implementing the health care act, could take a number of steps to mitigate the impacts of federal repeal. But some actions would be costly and require a difficult-to-muster two-thirds majority in the state legislature.
Covered California executive director Peter Lee, in the agency’s most recent board meeting Dec. 7, floated the idea of a state-level mandate if Congress repeals the federal mandate. A state mandate remains a somewhat far-fetched idea, as it would need approval by a two-thirds majority in the state legislature — difficult enough under normal circumstances but especially now, given that several Democratic lawmakers have recently resigned over sexual harassment allegations.
“It’s a policy idea that people are mulling over and examining, but it might be politically challenging,” said Laurel Lucia, a health policy analyst and director of the health care program at UC Berkeley Center for Labor Research and Education. “It’s always difficult to pass a new tax, regardless of what kind of tax.”
Massachusetts is the only state to have enacted a state mandate, in 2007, as part of the state’s broader health care reform package under then-Gov. Mitt Romney. The mandate, paired with state subsidies to help lower-income individuals buy health plans, lowered the Massachusetts uninsured rate from nearly 10 percent to 5 percent in its first year.
“The individual mandate, while never all that politically popular, did bring in some younger healthier people into the pool in those early years,” said Paul Hattis, a public health professor at Tufts University School of Medicine who specializes in health policy.
The individual mandate remains one of the most controversial components of the Affordable Care Act, with the American public more or less split on whether it should be repealed. The majority, 55 percent, support eliminating the mandate as part of the GOP tax plan, according to a Kaiser Family Foundation poll released in November. Their views are split along party lines. 73 percent of Republicans and 58 percent of independents supporting a repeal of the mandate as part of the GOP tax legislation. 59 percent of Democrats oppose a repeal.
California has flirted with a state mandate before. In 2008, the idea was included in a large health reform proposal under Gov. Arnold Schwarzenegger — modeled after Massachusetts’ plan, with government subsidies and a prohibition on denying coverage for people with pre-existing conditions — that cleared the Assembly but died in the Senate health committee.
A state mandate would be more effective if paired with additional financial assistance to help people afford health coverage, experts said. Rising premiums and high deductibles remain a major obstacle for hundreds of thousands of Californians who buy insurance through the exchange.
“When people can afford coverage, they want to enroll, generally, and there’s still affordability issues in the individual market,” Lucia said. “The state could also look at ways to make coverage through Covered California more affordable, increasing the premium subsidies for those who are eligible, and expanding the number of people eligible based on income.”