The conscientious objector in the case is Catholic Charities of Sacramento. The nonprofit organization, which is part of the Roman Catholic Church, argued that because Catholic doctrine condemns contraception, Catholic Charities qualifies for the exemption written into the law.

But the court saw it differently, ruling that the exemption applies only to churches, not to affiliated organizations. As the New York Times reported: “[T]he State Supreme Court ruled that the organization did not meet any of the criteria defining a religious employer under the law, which was passed in 1999. Under that definition, an employer must be primarily engaged in spreading religious values, employ mostly people who hold the religious beliefs of the organization, serve largely people with the same religious beliefs, and be a nonprofit religious organization as defined under the federal tax code.”

The executive director of the California Catholic Conference, Ned Dolejsi, said the court does not grasp the relationship between Catholic Charities and the Church. As the Times quoted him: “Every Catholic Charities is part of the Catholic diocese in the area where it is. Officially and formally, Catholic Charities of Sacramento is part of the Catholic Church in Sacramento, answerable to the local bishop and providing the services the church provides as a religious organization.”

How comforting is it that legislatures formulate criteria for who qualifies as a religious employer, and courts decide who meets those criteria? Is Catholic Charities sufficiently part of the Catholic Church to qualify for exemption from an intrusive law? Some judges will let you know. Nineteen other states have similar mandates, and a challenge is underway in New York, brought by Catholic and Protestant plaintiffs.

This sort of thing is not supposed to happen in a free society. Yet it does, because state legislatures have become bazaars at which providers and users of medical services and products lobby to have those things incorporated by mandate into employer-provided medical plans. The politicians are happy to oblige. Besides birth control, state mandates include “treatment” for drug and alcohol use, infertility services, hair transplants and toupees, marriage and pastoral counseling, and Viagra. States have enacted more than a thousand such mandates nationwide.

The motives of the parties are easily discerned. The providers anticipate more business if people don’t have to pay for their products and services out of pocket. The users prefer that someone other than themselves foot the bill. Unrepresented in the lobbying frenzies are people who neither want the products and services nor want to pay for other people’s use.

Insurance once meant the pooling of resources against financial ruin from possible but unlikely catastrophes. Today people expect medical insurance to cover volitional acts, such as taking birth-control pills, or events that are not diseases and often are volitional, such as pregnancy. In other words, insurance has become a way to have other people pay your bills. That’s one reason the health-care system is such a mess. Insurance relieves us of the need to be cost-vigilant. The chief consideration is: “Does my insurance cover that?” If the answer is yes, there is no need to inquire further about necessity or price. This perverse system guarantees that demand will increase and prices for services will be bid higher than they would have been. This, in turn, makes medical insurance more expensive, discouraging more employers from offering it. (Special tax treatment rigs the system in favor of employer-based plans.)

Insurance by Force

Coercion is the key. There is nothing to stop insurance companies from offering any coverage customers want. But if insurers wish to stay in business, premiums would have to reflect the cost of the services, including administrative overhead. People who don’t want coverage for contraception or alcoholism programs or hair transplants would buy basic, and cheaper, policies. Anyone who wanted that coverage would have to pay for it.

Advocates of insurance mandates point out that the per capita cost is lower when it is spread among more people. That may be true, although the stimulated demand and price rise might wipe out the savings. But it is also true that when everyone is forced into the pool, some people’s moral or religious convictions are violated. Hence, Catholics pay for contraception even if they have no intention of taking advantage of the mandate. Do we really want to run roughshod over some people’s consciences just so other people won’t have to pay the full price for their choices?

Violation of conscience is nothing new in the welfare state. The U.S. Supreme Court has ruled that legislatures may pass laws against using a substance (such as peyote) even when it is part of religious observance. The courts have not been consistent, however. In 1972 the Supreme Court struck down a Wisconsin law that compelled parents to keep their children in school until age 16 even though the Amish conscientiously objected. Self-employed Amish are exempt from paying the Social Security payroll tax, but not so Amish who work for others. Moreover, Amish employers are compelled to withhold the tax for their employees, despite their conviction that Social Security violates their “take care of our own” ethic. By the same token, the Amish request for exemption from child-labor laws has not been honored.

Even the narrow exceptions make a larger point: The state does not take seriously an individual’s moral objection to compulsory “benefits.” Before an exemption is considered, the authorities have to be satisfied that the objection is rooted in established religious doctrine. An individual with “merely” personal philosophical convictions against compulsion, however well-grounded in reason, has no standing. How odd for a country founded on the principles of individualism.

None of this should be surprising. The point of the welfare state is to compel universal participation. If the state required payment from only those who wanted the benefits, it would be indistinguishable from a private organization. For the system to “work,” everyone must take part—whether he wants to or not. But this means that conscience cannot intrude. Occasionally, the government will yield, but only in carefully defined cases that cannot be readily broadened into a full recognition of the individual’s right to personal integrity.

In other words, freedom of conscience must always take a backseat to the ambitions of social engineers.

It is important to recognize that what we call “health insurance” has little to do with health and nothing to do with insurance. We do not face a “health insurance crisis.” We face the consequences of a set of economic and social problems rooted in a futile effort to make the distribution of health care—unlike the distribution of virtually every other good and service in our society—egalitarian.

The typical contractor of homeowner’s insurance is the homeowner. He buys insurance to protect himself from costly loss caused by events outside his control, such as fire, not to defray the recurring expense of maintaining it. The ideal outcome for both the buyer and the seller of home and automobile insurance is for the policyholder to never make use of his policy.

The typical contractor of health insurance is not the insured person but his employer. Neither party is free to negotiate the terms of the policy. The employee cannot bargain for a lower premium in exchange for a high deductible or for choosing to be not covered for alcoholism or schizophrenia. The employer is not free to decline coverage for state-mandated medical services. In New York State, for example, the Women’s Wellness Act mandates group health-insurance plans to cover contraceptives including abortifacients, and the Infertility Coverage Act mandates that they cover infertility treatments, including selective fetal reduction (abortion of multiple fetuses conceived by artificial means).

The economic survival of an insurance company depends in large part on collecting more in premiums than it pays out in claims. To bring about that outcome the insurer employs certain methods, some complicated, some very simple. Although embarrassingly obvious, some of these simple measures need to be mentioned because they are absent from what we mislabel “health insurance.” For example, a person cannot buy a policy to protect himself from a loss caused by his own actions, such as burning down his own home. But so-called health insurance protects the individual from the medical consequences of his own actions, for example, injuring himself by smashing his car while drunk. Not surprisingly, all the participants in the complex scheme we call “health insurance” are unhappy with the result.

In the case of genuine insurance, there is a direct relationship between the dollar value of the protection purchased and its cost to the insured. The premium for a life-insurance policy with a face value of $100,000 is less than for a policy for a multiple of that amount. In health insurance no such relationship exists between premium paid and compensation received. Moreover, the health-insurance company, acting on its own behalf, can write a contract with a “cap” on claims, that is, for the maximum amount it will pay the insured, regardless of the health-care cost he incurs. The insured person, who typically does not act on his own behalf but is “provided” insurance as an important part of his job benefit, has no reciprocal options.

The sole rational purpose of true insurance is to protect the insured from an unanticipated economic loss so large as to jeopardize his economic well-being. No one sells or buys insurance to cover the cost of maintaining his property. Home insurance does not pay for plumbing repairs; automobile insurance does not pay for replacing worn-out windshield wipers. Yet people demand precisely this kind of reimbursement from so-called health insurance.

“Health Insurance”: The Illusion of Equality

If health insurance is not insurance, what is it? It is a modern version of the illusion that all men are equal—or, when ill, ought to be treated as if they were equal. When religion was the dominant ideology, death was (supposed to be) the great equalizer: once they departed the living, prince and pauper were equal. Today, when medicine is the dominant ideology, health care is (supposed to be) the great equalizer: everyone’s life is “infinitely precious” and hence deserves the same protection from disease. Of course, prince and pauper did not receive the same burial services, and rich and poor do not receive the same medical services. But people prefer the illusion of equality to the recognition of inequality.

Actually, the ruled have always longed for “universal health care,” and the rulers have always supplied them with a policy that the masses accepted as such a service. In the Middle Ages, universal health care was called Catholicism. In the twentieth century, it was called Communism. In the 21st century, it is called Universal Health Insurance. What we choose to call “health insurance” is, in fact, a system of cost-shifting masquerading as a system of insurance. We treat a public, statist political system of health care as if it were a system of private health insurance purchased for the purpose of obtaining private medical care.

Everyone knows but no one admits that health insurance is not really insurance. In fact, Americans now view their health insurance as an open-ended entitlement for reimbursement for virtually any expense that may be categorized as “health care,” such as the cost of birth-control pills or Viagra. The cost of these services is covered on the same basis as the cost of medical catastrophes, such as treatment for the consequences of a brain tumor. Such distorted incentives produce the perverted outcomes with which we are all too familiar.

From a public-health point of view, the state of our health is partly, and often largely, in our own hands and is our own responsibility, even if we have a chronic illness, such as arthritis or diabetes. It is an immoral and impractical endeavor to try to reject that responsibility and place the burden for the consequences on others.