America Still at Risk for Socialized Medicine

In 2012 the Supreme Court ruled that the individual mandate in the Affordable Care Act - Obamacare - was constitutional. This was not surprising: after all, since the 1930s the federal government has mandated that Americans buy retirement benefits through Social Security.

Now there is another legal challenge to the ACA on its way through the court system. Ben Barr at wyliberty.org explains:

Today, two U.S. Courts of Appeal issued contradictory rulings on a key aspect of the Affordable Care Act. At issue in both cases was whether tax credits would be available for individuals purchasing health insurance outside of a state-run exchange.

Two federal appeals courts have ruled on this, one giving states and only states the right to hand out tax credits, the other giving the nod to the IRS.

It is a blessing for our country to have an active judicial system functioning as a check and balance on the other two branches of government. Under European parliamentary systems, power is for the most part concentrated to the national parliament.

At the same time, the focus on legal battles can also distract from a more principled debate over what role government should or should not have in our economy. This latest ACA battle is a case in point.

If the Supreme Court eventually settles the issue by ruling that only states can give out tax credits, then we would end in the awkward situation where Congress mandates that every American buy health insurance but only states can make sure those who cannot afford it get some help buying it.

What, then, happens if a state does not provide tax credits and people cannot afford to buy health insurance? Will Congress eliminate the federal mandate, or change the funding mechanism?

At that point, a change in the funding mechanism would mean a dedicated tax to pay for the ACA. Such a tax would bring America a big step closer to having her own version of the British National Health Service.

Is that what America wants? Hopefully not. However, given the history of government entitlement programs – including Social Security – it is unfortunately more likely with a permanent expansion of ACA funding than a repeal of the law itself. The only way to avoid that is through a lively, vigorous health care debate on principled grounds.