Individual Mandate

The individual mandate regulation received substantial attention as part of the U.S. federal government’s Affordable Care Act (ACA) in 2010. It requires each citizen of the United States to provide proof of health insurance coverage (as part of filing federal income taxes) or be subject to a fine imposed by the federal government. This portion of the law was considered essential for mitigating insurers’ concerns of adverse selection resulting from the ACA’s guaranteed issue provisions, which do not allow insurers to refuse insuring individuals with preexisting conditions. If only those in poor health purchased insurance on the exchanges, premiums would increase rapidly (as occurred for 2017 premiums on ACA exchanges), leading to concerns of death spirals that would result in the dissolution of the individual ...