Question

What does the Individual Mandate require in terms of health insurance?

A) It mandates that all employers must provide health insurance to their full-time employees.
B) It requires individuals to purchase health insurance coverage.
C) It encourages voluntary health insurance enrollment.
D) It imposes penalties on individuals for not seeking health insurance.

Answer 1

The Individual Mandate requires individuals, who do not receive health care through their employer or a government program, to have health insurance or pay a fine. It aims to reduce adverse selection and ensure a balanced insurance pool.

Step-by-step explanation:

The Individual Mandate requires individuals, who do not receive health care through their employer or through a government program (such as Medicare), to have health insurance or pay a fine. The goal of the individual mandate is to reduce the adverse selection problem and keep prices down by requiring all consumers, even the healthiest ones, to have health insurance. This ensures that there is a mix of healthy and sick individuals in the insurance pool to help spread out the costs. Without the individual mandate, only the riskiest individuals might opt for insurance, leading to higher prices for everyone.