If the health care law is implemented without the individual mandate insurance premiums would rise by as much as 25%, according to a new report by the Urban Institute Health Policy.

Without the individual mandate — the requirement for most Americans to have health insurance or face a penalty — the analysis reveals costs would rise and fewer individuals would be uninsured.

Eliminating the Individual Mandate: Effects on Premiums, Coverage, and Uncompensated Care full report examines what would happen if the mandate was cut from the Patient Protection and Affordable Care Act.

Co-authors of the report, Matthew Buettgens and Caitlin Carroll, estimate the effects of the Patient Protection and Affordable Care Act and the individual mandate by using the Urban Institute’s Health Insurance Policy Simulation Model (2011) which simulates decisions of businesses and individuals in response to policy changes such as new health insurance options, subsidies for the purchase of health insurance, Medicaid expansions and insurance market reforms.

If the individual mandate was nixed the report highlights other main points:

  • Private coverage would fall 11 million, covering 4 million fewer people than it would have without reform
  • It’s estimated that between 40 and 42 million would remain uninsured as opposed to 26 million
  • Uncompensated care spending would be much higher due to the increased number of the uninsured.

The paper updates a previous report published in January 2010 and incorporates more recent data as well as a revised model reflecting the latest available regulations and trends in state implementation decisions.

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