In Health Care Reform Debate, White House Looks Beyond Individual Mandate

White House Weighs Health Care Without The Individual Mandate

WASHINGTON -- Health care reform advocates are growing more confident in the idea that the Affordable Care Act can remain viable even if the Supreme Court strikes down the provision that requires individual citizens to purchase health insurance.

Though conversations inside the White House have been kept secret, several Democratic sources said that administration officials now believe that the law can stand without the individual mandate. Last week, Bloomberg News reported that President Barack Obama told campaign donors that he might have to take a second bite at the health care reform apple after the court issues its decision in late June.

"Our hope and our expectation is that the Supreme Court will affirm the health care law, and if they don’t we will speak to that after," David Axelrod, senior adviser to the Obama campaign, said on a conference call Monday in response to a question from The Huffington Post. "But now is not the time to speculate on that. We believe the law is constitutional."

Yet the administration has privately considered alternative reform ideas, despite publicly insisting that such considerations would be premature. One aide put it this way: "When the decision comes down, we will be ready."

Increasingly, the focus has turned to what would happen should the court rule the individual mandate unconstitutional but declare that it is severable from the rest of the law.

The White House has argued that the provision is intertwined with the rest of the law's reforms to insurance markets. That argument was driven out of the sincere belief that the Affordable Care Act worked best when the free-rider issue was effectively eliminated; more customers needed to be forced to buy insurance in order to prevent insurers from discriminating against people with pre-existing conditions.

But as the Supreme Court's ruling draws near, talk of the mandate's necessity has been replaced with conversations over the other options in the policy cupboard. Those include penalizing people who show up for emergency coverage after their surgery and tax incentives for buying insurance.

"As someone who believes the court is going to uphold fully, I do believe there is plenty of time -- and plenty of options to develop and for Congress to enact -- [for] alternative inducements should it be necessary," said a top health care reform advocate, who asked to speak anonymously for fear of getting ahead of the post-Supreme Court political process.

Health care reform advocates have also revisited a RAND study that shows that if the individual mandate were removed from the law, the effect on premium prices for consumers would be "only modest," even though roughly 12.5 million fewer people would receive insurance coverage and costs for the federal government would rise.

"[T]he RAND team predicts that these relatively modest premium increases will not be enough to trigger catastrophic failure of the exchanges," the study concluded. "Why? Because of insurance subsidies, many enrollees will perceive little or no change in the amount of their contribution even when premiums increase. This reduces the chance of a large-scale exodus from the market."

A recent Urban Institute survey, meanwhile, showed that if the mandate were instituted as designed, it would affect between 2 percent and 5 percent of the total population -- a figure that falls far short of what news coverage would suggest.

Discussions are also taking place among Democrats about what would happen if the court were to throw out the entire law. Because insurance companies are already implementing many of the law's reforms, some predict that they would simply continue to do so.

"[The Affordable Care Act] is also really important to the health and well-being of the American people," said Axelrod. "It is already helping people all over this country, and has improved the position of people relative to their insurance companies, and the kind of policies they are getting and the return they are getting for the premiums they are paying."

Among the provisions considered likely to withstand a complete gutting by the Supreme Court is the one allowing people to remain on their parents' insurance up until the age of 26. The provision is highly popular and relatively cheap for insurers.

More uncertain is the fate of some of the more further reaching elements of health care reform, including the closing of the Medicare Part D coverage gap and the outlawing of discrimination against children with pre-existing conditions. Should those provisions fall, it's unclear whether or not they could be re-implemented -- or whether or not such legislation would even be able to pass Congress.

"If the insurance reforms go out, it is a different story," said one leading Democratic health care reform operative, "because they would have to legislate the reforms again."

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