And before you go all authoritarianism on me, you can't have it both ways. Either you have to allow insurance companies to deny pre-existing conditions, or you have to force people to buy insurance. If you don't do either then people wait until they're sick to buy insurance, and then insurance companies go out of business. Socialist healthcare systems like in Europe do the second one by basically buying insurance for everybody through tax receipts (I didn't say that the insured had to directly pay the premium).
Such shallow thinking. How about forcing a penalty after needing treatment without insurance or the ability to pay it?
What happens if you have no insurance for 20 years, and never get sick. Then you sign up for insurance and pay your bills for 5 years. Then you get sick. What is the fine, and what happens if the person doesn't have the money to pay it at this point?
Why wait 20 years to charge them for 20 years of premiums?
The most sensible solution would be to just have the government buy insurance for anybody who does not do so, and then tax them for it. That is what happens if you don't mow your lawn - the local government will just mow it for you and send you a bill, and put a lein on your house if you don't pay it.
However, for whatever reason the government choosing your insurance policy turned people off, so instead we have a tax that people without insurance have to pay. The problem is that the tax is way too low, so for those who are young and healthy it just makes sense to pay the tax.
You do not need to force insurance purchased or allow preexisting condition exclusions. You can simply penalize the people who do not have coverage when they need it and also do not have the ability to pay for their treatment. You can also mandate as part of that penalty that they maintain coverage for a certain period of time.
If the penalty is less than the total of all the unpaid premiums, then there is no incentive to buy insurance, and the insurer loses money on the patient (since the premiums are calculated as the amount of money needed to cover losses on average, plus a profit).
What you propose is like a retirement plan where you tell people to save up for retirement, and then if they fail to do so and have no money you fine them, except they have no money so you can't fine them, and you still have to pay for their retirement. If you want people to invest in the future you have to give them incentive to do it when they can actually do it (whether investment is for retirement, or future health problems, or whatever).
The thing is, the people who say they don't want/need insurance are more than happy to sign up for it once they get an expensive medical condition, so what they usually really want is to have the benefits of insurance without actually paying for it.
What people want is to not pay for something until they need it. They don't want to buy new tires for their car until their old ones need replaced, They do not want to buy another gallon of milk until the other is almost empty. Can you blame them for not wanting to be forced into buying something they do not need at the moment?
This is INSURANCE. The whole point of insurance is that you don't know when you'll need it, so you pay money now so that in the event you need it you know you'll have it. I "waste" money on fire insurance every month. My house will probably never burn down, and thus I'll probably never get anything back. However, if my house does burn down, then I get a new house for very little money.
The only way to allow people to not buy health insurance is if we as a society refuse to provide care for them when they get sick unless they can pay the full bill themselves. If we were all sociopaths that system would work just fine, and people WOULD buy insurance because they would understand the consequences if they didn't. They would call 911 with chest pains, the call center would be set up to do an automatic insurance/credit check, and the guy on the phone would tell them that if they'd like an ambulance they need to get somebody else to provide a credit card number if the credit check isn't good. That isn't the society most voters want to live in.
The thing is, the insurance available to those people who do not want it, is more or less the same as not having insurance for all practical purposes. I had a Health Savings Account and a catastrophic plan. The catastrophic insurance cost me $5 a week or $20 a month and covered any major medical like a broken bone, cancer, heart attach and so on.
And such issues don't cost that much money to treat or are incredibly rare, which is why regular insurance plans don't cost that little. What was your plan if you got diabetes or kidney failure? Is that when you sign up for the $110/month plan and stick everybody else with the bills since you didn't pay the $80/month they paid for the previous 20 years when you weren't sick?
Everything else was out of pocket which you will find that medical bills are dramatically cheaper when you are paying cash or cash equivalent at the time of service. That's where the HSA came in handy, the $95 Hemoglobin A1c with fasting glucose levels out the door cost me $22 total when paying cash at the local hospital.
You have a very nice local hospital. Most would have given you a steep discount and charged you only $50. However, no insurance company would pay the $95 - there is a good chance they might not even pay the $22 (though as I said you got a decent deal). Usually the hospital cash discounts are actually more expensive than what the insurance company pays, because the insurance company can basically shut the hospital down if they don't like the rate. I don't have a bill that just covers A1C, but a bill I recently paid included a $71 (list price) A1C test in a set of tests that cost $286 total, and the cost to me and the insurance was $47. That is pretty typical - insurance companies only pay 20% of the list price for most things. When the hospital cuts 60% off the bill for a cash customer they love to go on about the deal they got, even though they paid twice what most people pay.
Outside of getting that checked for a physical, I don't spend much more than $1.5-2k a year in medical with many years being less that $1000. Now I have to purchase insurance that costs $110 a month and carries a $3000 deductible.
You're missing the point of insurance. You're not paying for your current medical condition. You're paying for when you do (or don't) get diabetes, or kidney disease, or cancer.
I pay more than your health insurance bills every year for fire insurance on my house (a rather modest one at that). I spend $0 on repairs caused by fire. Sounds like I'm getting ripped off! Except, if my house burns down when I'm age 55 I won't be homeless for the rest of my life, or dependent on my fellow taxpayers for welfare or charity.
But yes, we can have preexisting condition coverage and not mandatory insurance if we treated it just like we treat every other crime and not penalize someone until they actually do something wrong.
Not buying insurance IS the thing they actually did wrong. An involuntary action can't be right or wrong - it just "is." So, getting sick can't be the thing that somebody does wrong. The time to pay for illness is BEFORE you're sick, not after.
Plus, lots of people may go through live for 70 years and never get sick, and then get hit by a truck and die on the scene. The way insurance works is that they pay for it all their life and never get a dime. Then some other poor kid gets leukemia at the age of 6 and the insurance company pays $20k/yr on medical bills for the next 40 years. It all works out, since the insurance costs are based on statistics. However, it doesn't work out when people only want insurance when they "need" it.
Would it make sense for me to not pay for fire insurance for 20 years, then have a fire, and have society come along and spend $150k building me a new home, and then try to fine me for it? What happens if I don't have $150k, or even the total of 20 years worth of premiums? Plus, the insurance company is out more than 20 years worth of premiums - they're out the premiums from all the other people who didn't pay and whose houses didn't burn down (but which they apparently have to repair anyway).
Insurance premiums are based on most people paying and never collecting for most types of insurance. If you only charge people who do collect, then you'll have to charge them a LOT more.