Cato Surpises me on the Medical Care Mandate

Not surprisingly, Ilya Shapiro of the Cato Institute does not like the Affordable Care Act's mandate that every American purchase health insurance and has reviewed the sordid history of federal intervention over the last hundred years in his recent opinion Obamacare Premise is Just Wrong.

Indeed, it wasn’t until the New Deal that the Supreme Court allowed Congress to regulate wholly local economic activity. Using the power to make laws that are “necessary and proper” to the enforcement of broader regulations, the court said, the federal government could regulate certain types of local economic activity (wheat-farming, in one particular case) that had, in the national aggregate, a “substantial effect” on interstate commerce. 

But to my surprise he has no problem mandating physicians and hospitals to care for the uninsured for free.

There are plenty of commodities that we all consume: food, shelter, clothing, mortuary services. Many others may lead to large and unexpected costs: a car totaled in an accident, a house destroyed by fire or flood. And the only reason why the impecunious uninsured can slough the costs of their emergency care onto the taxpayer is because the Emergency Medical Treatment and Active Labor Act requires hospitals to provide care regardless of legal status or ability to pay.

I support EMTALA – I wouldn’t want to live in a society that lets people die in the streets – but it cannot justify the individual mandate.

Think about it: if all Congress had to do to get more power was to pass a law creating an economic or other policy problem, then there would be no constitutional limit on federal authority. Instead, Congress could rub Aladdin’s lamp to wish for more wishes whenever a majority of its members thought it wise to do so.

Huh? He supports EMTALA? How can a small-government,  free market think tanker so distrust the free market!? One would think that the mere threat of people dying in the street would propel some free market solution, after all the free market solves everything-- the invisible hand should be able to at least start an IV.  But no, mandating private citizens and private corporations is okay only when they are doctors and hospitals, but mandating private citizens to buy insurance infringes on rights.  Okay.  

To use Cato's analogy, if a supermarket accepts food stamps then they should be required to provide free food to anyone regardless of their ability or willingness to pay.  We wouldn't want to live in a society that lets people die from starvation. If a homebuilder accepts federal financing for home loans then it follows that they should be required to provide housing to anyone, allowing squatters into a new home whenever that person feels the need. We wouldn't want to live in a society that let's people die from exposure.   


EMTALA naturally leads to universal health care, one way or another.  Either it's mandated by government up front or costs rise to the point that every health care entity goes bankrupt and is taken over by government out of necessity.  It's been a long time coming as we've seen health care go from 8% of our GDP to nearly one-fifth. What's the breaking point, 0ne-third, one-half?   Should we finally do something when health costs take up 50% of every dollar our nation produces?

I get that it's squeamish to think of individuals being denied necessary care and I certainly am not advocating EMTALA be repealed (although it would make an interesting thought experiment), but that does also does not mean that we can ignore the ignoble ramifications of requiring the unfunded mandate associated with it.  EMTALA was signed into law by President Reagan when the uninsured represented a fraction of what they do now, but Cato is loathe to admit EMTALA's effect of removing the moral hazard from individuals regarding health care may have had a fundamental role in the burgeoning number of uninsured today. If the the law had not been so lenient toward those irresponsible enough to eschew health insurance maybe we wouldn't now have 40 million uninsured.

In effect, EMTALA is a form of universal health care-- nobody can be denied, nobody will die in the streets-- but it's the worst kind: with no cost controls, no personal responsibility, no oversight.  Shapiro is one of the few commentators these days who even recognize the existence of EMTALA but he still offers no solution.  

Solutions short of the ACA's individual mandate have been offered, such as funding EMTALA care with federal funds, and while this still would not not furnish adequate comprehensive care and preventive services at least we could continue a reasonable dialog.