Millions of U.S. consumers would gain access to health insurance while their premium expenses would decline if all states implemented their own health care mandates, according to a study from The Commonwealth Fund and Urban Institute. Massachusetts and New Jersey have mandates and, if every state followed their lead, nearly four million consumers would have health insurance and premium costs would decline by an average of almost 12 percent, according to a news release from The Commonwealth Fund.
“These mandates would replace the Affordable Care Act’s penalty for not having health insurance, a fee that Congress eliminated, effective 2019,” it states. Currently, the Affordable Care Act requires most Americans to have an insurance plan or face a financial penalty in an effort to “stabilize insurance markets by encouraging healthy people to purchase and stay enrolled in a health plan,” The Commonwealth Fund reports.
The Congressional Budget Office expects premiums will rise and more consumers will lose their health insurance when the penalty is eliminated in January 2019. However, according to The Commonwealth Fund and Urban Institute Study, if states take the reins and create their own mandates:
Millions more consumers would have health insurance. In fact, enacting state individual mandates across the country in 2019, when the federal penalties are lifted, would lower the number of uninsured by 3.9 million—or 11.4 percent.
If all states enacted their own mandate, health care premiums would decline an average of 11.8 percent. The impact on premium rates would differ across states, for example, premiums would decline by more than 20 percent and Colorado, the District of Columbia, Kentucky, Nevada, North Dakota, Washington, and West Virginia would see declines of more than 15 percent.
The study also shows uncompensated care costs for health care providers would significantly decline. “When patients are uninsured and can’t pay their medical bills, state and federal governments, as well as physicians, hospitals and community health centers, absorb the costs of this uncompensated care,” according to the news release. “As more people gain coverage mandates, demand for uncompensated care would fall by $11.4 billion nationally.
States can also enact comparable mandate penalties to those at the federal level to mitigate any negative effects of eliminating the penalties under the Affordable Care Act. The study’s authors, Linda Blumberg, Matthew Buettgens and John Holahan from the Urban Institute note that there are significant challenges to getting state-level mandates off the ground.
“Some states, for example, do not have state income taxes, and new financial structures would have to be developed to collect individual mandate penalties,” they report. “Other state political environments are not conducive to enacting individual mandate legislation, even in states where governors and state policymakers generally support the [Affordable Care Act.]”
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