Economic Analysis: Price is a function that is primarily made up of cost and demand. As demand goes up, prices go up. As costs go up, price goes up. The “individual mandate” requires the entire population to purchase a product, thus increasing demand. In addition, it applies a series of new regulations on companies such as requiring companies to lose money on patients that will excessively use their services, putting new standards on doctors, putting new standards on procedures and reporting… in addition to hundreds of other additional requirements. As you increase regulations on entities, there are direct and indirect costs associated with it, increasing the cost of doing business.
“Obamacare” as it has been coined does not address the issues that have caused healthcare costs to increase, but rather has and will continue directly adding to the problem. Prices have been rising through decades of regulatory expansion on the industry and through increasing the insurance pool and raising demand. Obamacare does not decrease demand nor decrease costs, btu in fact does the opposite.
America’s Health Insurance Plans, the group that represents the healthcare industry, responded to the ruling by saying, ““major provisions, such as the premium tax, will have unintended consequences of raising costs and disrupting coverage unless they are addressed.”
The group continued to elaborate by citing the Urban Institute study that demonstrated how the increase in demand and the increase of costs will lead to higher prices. Single policyholders between 18 and 34 will see a $1,400 increase per year. Those between 35 and 44 can be expected to see a $800 increase per year. These additional price increases will go on top of the price increases that have already occurred as a result of the law’s passing.
Real healthcare reform would address the underlying cause of price increase and address regulatory cost increases and regulatory demand increases.
In addition to the direct impact on healthcare, the ruling illegally expands the power of the Federal Government by giving them a “loophole” to classify every mandate as a tax, regardless of whether it is or not. The Supreme Court’s history has been filled with instances of hypocrisy, admitting to their rulings not being based on law but rather political opinions, making decisions that are not only against the law but morally objectionable, and oftentimes at the expense of the liberty of the people.