The importance of the individual mandatePick your favorite system. Socialized medicine in Britain. Single-payer in Canada. Multi-payer with a government floor in France.
Private plans with heavy public regulation in Sweden, Germany and elsewhere. None of these plans are "voluntary." In some, there's an individual mandate forcing you to pay premiums to insurance companies. In some, there's a system of taxation forcing you to pay premiums to the government. In all of them, at least so far as I know, participation is required except in very limited and uncommon circumstances.
Holding the price of insurance equal, insurance is gamble on both sides. From the insurer's perspective, it's a better deal to insure people who won't need to use their insurance. From the customer's perspective, it's precisely the reverse.
Right now, the insurer sets the rules. It collects background information on applicants and then varies the price and availability of insurance to discriminate against those who are likely to use it. Health-care reform is going to render those practices illegal. An insurer will have to offer insurance at the same price to a diabetic and a triathlete.
But if you remove the individual mandate, you're caught in the reverse of our current problem: The triathlete doesn't buy insurance. Fine, you might say. Let the insurer get gamed. They deserve it.
The insurers, however, are not the ones who will be gamed. The sick are. Imagine the triathlete's expected medical cost for a year is $200 and the diabetic's cost is $20,000. And imagine we have three more people who are normal risks, and their expected cost in $6,000. If they all purchase coverage, the cost of insurance is $7,640. Let the triathlete walk away and the cost is $9,500. Now, one of the younger folks at normal cost just can't afford that. He drops out. Now the average cost is $10,600. This prices out the diabetic, so now she's uninsured. Or maybe it prices out the next normal-cost person, so costs jump to $13,000.
This is called an insurance death spiral. If the people who think they're healthy now decide to wait until they need insurance to purchase it, the cost increases, which means the next healthiest group leaves, which jacks up costs again, and so forth.
Kill the individual mandate and you're probably killing the bill, too. The mandate is what keeps average premium costs low, because it keeps healthy people in the insurance pool. It's why costs have dropped in Massachusetts, not jumped.
It's why every other country with a universal health-care system -- be it public or private -- uses either a mandate or the tax code. http://voices.washingtonpost.com/ezra-klein/2009/12/draft_1.html