The individual health insurance coverage mandate is such a vital component of the year-old health reform law that, if removed, alternatives would be needed, says the American Academy of Actuaries. Mandates serve to help attract low-risk individuals, which is necessary to prevent adverse selection to keep the health insurance markets viable.

“To make the provisions that and eliminate exclusions for pre-existing conditions work, health insurance markets must attract a restrict rating balanced cross-section of risks,” says Cori Uccello, senior health fellow for the American Academy of Actuaries. “This means finding a way to encourage the enrollment of low-risk individuals. The individual coverage mandate may be the best tool available to achieve that.”

Uccello said that a newly released U.S. Government Accountability Office report provides a significant examination of possible alternatives to the mandate, should it be declared unconstitutional or repealed through legislative efforts.

She said some of these alternatives should be explored as possible methods to strengthen and improve the mandate even if it is not eliminated.

Alternatives include:

  • Late-enrollment penalties
  • Increasing the time between open-enrollment periods
  • Auto-enrollment features
  • Limiting the ability to upgrade to more generous benefit plans during open enrollment

Get more: Coverage of the individual mandate under PPACA

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