Recently, a fedeal appeals court struck down a key component of the health care law — the provision requiring all citizens to acquire coverage. And while the court didn't declare the entire Affordable Care Act unconstitutional, as previous courts did, the decision was certainly a game changer for those in the health insurance industry.
Pete Villemain, president and owner of Employee Benefit Services, says there are two ways the decision could go from here. One, the ACA could stay in place, with the individual mandate removed.
According to Alex Forrest of AC Forrest Insurance Group, that would cause problems for insurance companies.
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"Because insurance is essentially the pooling or sharing of risk, you have to broaden the pool as much as possible. Otherwise you wind up with adverse selection, which is basically the idea that the only people who want to share risk are those who have the greatest risk or know theyll have claims," he said.
Basically, Forrest said that the lack of an individual mandate would lead to the collapse of the very system the bill created.
"If that happens, it's great," Villemain said. "Health care reform is a detriment to the insurance industry."
Timothy G. Wiedman from the division of Economics and Business at Doane College in Nebraska believes that the court did the right thing when striking down the mandate.
"A person cannot be forced to enter into a private contract simply because he or she was born on American soil," he said. "In fact, being forced into a contract is called 'duress' and it renders a contract voidable under the law. This decision will go to the Supreme Court and will be affirmed."
The other option is the bill heads to the Supreme Court, which strikes the entire ACA down as unconstitutional. The Justice Department is reviewing the court's decision and will appeal to the Supreme Court. But experts seem divided on how the court will decide.
Villemain hopes the Supreme Court will agree with the circuit court, and even take the decision a step further.
"I hope the Supreme Court will take it on and I hope that they strike down the entire health care bill," he said. "But I dont think they're going to uphold that decision because I don't think they want to get that involved in policy making. My wish is that they say they agree with the appellate court, but at that point Congress needs to look at the whole health care bill and realize that it doesn't work without the individual provision, and then completely re-do the whole bill."
Wiedman believes the entire bill needs to be rewritten as well, especially if the individual mandate is removed, as the 11th Circuit believes it can be.
"It is hard to see how ObamaCare could be financially viable without the individual mandate," he said. "Thus, the entire law could be thrown out and we would be back at square one. A new cast of characters in Congress would have to revisit health care reform, and I believe that their approach toward cost control would be quite different. I would expect to see a free market approach to emerge … that allows competition across state lines."
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