At a July press conference, President Obama claimed "the average American family is paying thousands of dollars in hidden costs" because uncompensated health care for the uninsured drives up the price of medical coverage. In an interview with ABC's George Stephanopoulos on Sunday, by contrast, he said uncompensated care costs the average family $900.
According to a 2008 report from the Henry J. Kaiser Family Foundation, both of those estimates are way off. The foundation's analysis indicates that the true annual cost per family is more like $200, with uncompensated care accounting for "less than 1 percent of private health insurance costs."
These numbers are important because the president's main justification for requiring every American to buy health insurance, a central element of his reform plan, is that uninsured people unfairly impose costs on their fellow citizens. That rationale not only has a weak empirical basis, it conceals the real motivation for the individual insurance mandate, while dodging moral and constitutional questions about it.
During the presidential campaign, Obama castigated his Democratic rival, Hillary Clinton, for saying the federal government should force everyone to buy health insurance. Five months into his presidency, however, Obama said he supported "making every American responsible for having health insurance coverage."
In a speech this month, he argued that "the young and the healthy" cannot be permitted to "take the risk and go without coverage" because "such irresponsible behavior costs all the rest of us money," since "we pay for these people's expensive emergency room visits."
The problem with this argument is not just that the cost of such uncompensated care seems to be much lower than the president claims. It's also his assumption that everyone who goes without insurance is a freeloader.
What about the young and healthy (or middle-aged and wealthy) person who decides insurance is not worth his money but pays all his medical expenses out of his own pocket? His choice does not impose costs on anyone, but under Obama's plan he would still be punished for it.