Is mandating health coverage legal
Knowing the risks and costs to insurance companies would skyrocket, this mandate is intended to keep them in business by forcing low-risk consumers to buy.
Restricting costs, mandating employer coverage and requiring minimum benefits further drive a wedge between the consumer and the real cost of health care.
Many argue that health insurance itself is a moral hazard, since it reduces the risks of pursuing an unhealthy lifestyle or other risky behavior.
State policymakers also want to protect future state budgets from rising demands for government services due to aging residents lacking retirement savings.Here’s a taste of what’s been proposed and what’s passed in a few places: California’s Secure Choice, four years in the making, will be an Automatic-IRA plan, better known as an Auto-IRA.Its prime beneficiaries: the roughly 6.3 million private-sector employees — nearly two-thirds minority — who work there for companies without retirement plans.Premiums have predictably spiked since passage of the Act, consistent with economic theory about moral hazard.
Thanks to the aging of the baby boom generation, the phrases “too little” and “retirement savings” has become almost one word — toolittleretirementsavings. But the real issue is that about half of private-sector employees (55 million workers; many at small businesses) aren’t covered by an employer-sponsored retirement plan.In a competitive market, however, insurance companies charge higher rates to riskier customers.