End the Mandate

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by Ron Paul: Why
Governments Hate Gold

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administration’s terrible healthcare reform bill is now law, but
the debate over how — and whether — the federal government
should be involved in providing healthcare services is not over.
It is not too late for America to correct its course and stop the
march toward a government-run, "single payer" healthcare

Polls show
that a large majority of Americans don’t want Obamacare. Congress
should seize the opportunity to repeal the very worst aspect of
this new legislation, namely the mandate that forces every American
either to purchase health insurance or face an IRS penalty. This
mandate represents nothing more than an unconstitutional, historically
unprecedented gift to the insurance industry. I introduced the "End
the Mandate Act” (HR 4995) expressly to prevent the administration
from ever putting this provision into effect.

Instead of
mandating the same failed entitlement healthcare schemes that are
bankrupting Europe, Congress should fundamentally re-examine the
case for free-market healthcare. Our current model, based on employer-provided
health insurance, did not arise based on market preferences. On
the contrary, it makes no sense to couple health insurance with
employment. But federal wage and price controls instituted during
World War II left employers with no alternative to attract workers
in a tight labor market other than offering extra benefits such
as health insurance and pensions. Over time these nonwage benefits
became the norm, especially since employers could deduct the cost
of health insurance premiums from their income taxes while individuals
could not. The perverse consequence is that employees lose both
their paychecks and their health insurance when they lose their

As reliance
on third-party health insurance grew, patients became detached from
the true costs of their doctor visits. In the 1970s the Nixon administration,
along with the late Senator Edward Kennedy, championed the cause
of health maintenance organizations (HMOs). Congress accepted the
faulty premise that HMOs would reduce costs through centralized
management of patients, when in fact the opposite was true: more
bureaucracy would only lead to higher costs, less accountability,
and worse patient care.

In recent years
Congress has only intensified the problem with more laws and more
regulations, especially with the disastrous Medicare prescription
drug benefit. The drug benefit was another example of naked patronage
to a politically-connected industry, and it exponentially worsened
the federal government’s balance sheet. Obamacare will be the
last nail in the coffin of our bankrupt entitlement system.

More laws are
not the answer. Instead, we need to allow a market system to operate
that reflects consumer choices while rationally pricing services.
In a market system patients likely would pay cash for basic services,
while maintaining relatively high-deductible catastrophic insurance
for serious illnesses and accidents. The cost of most routine medical
care would drop if the patient paid the bill on the spot, especially
if doctors no longer needed to employ large staffs solely to deal
with insurance and billing.

Let me repeat:
we need a system in America where patients pay cash for basic services,
and carry insurance only for serious illnesses and accidents. “Health
maintenance” is the responsibility of each of us individually.
We cannot continue to collectivize the costs of healthcare and expect
things to get better.

is bad for your health. Congress should end the Obamacare mandate
and allow market-based medicine to flourish.

the Ron Paul File

15, 2010

Dr. Ron
Paul is a Republican member of Congress from Texas.

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