Saturday, March 27, 2010

Individual Mandate Not Enforceable?

It appears as if there is no enforcement mechanism for the Individual Mandate. Combined with forcing companies to cover 'preexisting conditions' (which make no sense and is not insurance) there could be a serious problem for health insurance companies. People do not have to sign up for insurance, but can force the companies to pay their medical bills by signing up after the diagnosis of something serious.

"However, it turns out that the Democrats who crafted this bill significantly – and I mean significantly – hamstrung the ability of the IRS or any other federal agency to enforce or collect on this mandate. Here is what the federal Joint Committee on Taxation had to say about this issue in a report released earlier this week:

Individuals who fail to maintain minimum essential coverage in 2016 are subject to a penalty equal to the greater of: (1) 2.5 percent of household income in excess of the taxpayer’s household income for the taxable year over the threshold amount of income required for income tax return filing for that taxpayer under section 6012(a)(1);67 or (2) $695 per uninsured adult in the household. The fee for an uninsured individual under age 18 is one-half of the adult fee for an adult. The total household penalty may not exceed 300 percent of the per adult penalty ($2,085). The total annual household payment may not exceed the national average annual premium for bronze level health plan offered through the Exchange that year for the household size…

The penalty applies to any period the individual does not maintain minimum essential coverage and is determined monthly. The penalty is assessed through the Code and accounted for as an additional amount of Federal tax owed. However, it is not subject to the enforcement provisions of subtitle F of the Code. The use of liens and seizures otherwise authorized for collection of taxes does not apply to the collection of this penalty. Non-compliance with the personal responsibility requirement to have health coverage is not subject to criminal or civil penalties under the Code and interest does not accrue for failure to pay such assessments in a timely manner.

According to a footnote in the report, “subtitle F of the Code” is the portion of the tax code which grants the IRS the authority to assess and collect taxes. In other words, as the law is written the federal government has no legal authority to enforce this mandate, nor will it have any recourse to collect any penalties that go unpaid!"


  1. This all sounds about right to me, of course a much better system then subsidizing health insurance companies would be to just let people enroll in say medicare- which would take a huge burden off of busineses, cost much less and give us all much better outcomes.... your starting to sound like a single payer advocate.

    The mandate is just a tax, its the same as saying “in addition to their other income taxes, everyone needs to pay a $X annual ‘health responsibility tax.’” Then I could also adopt a legal definition of adequate health insurance, and say “everyone who has adequate health insurance gets a $X tax credit.” Wham, bam, mandate.

    I found this also tooling around the internet, I don't know what your views on health care system were in 2003, but here's what the heritage foundation had to say about it then when conservatives actually had to pretend to care about our disaster of a system:

    "But as part of that [social] contract, it is also reasonable to expect residents of the society who can do so to contribute an appropriate amount to their own health care. This translates into a requirement on individuals to enroll themselves and their dependents in at least a basic health plan – one that at the minimum should protect the rest of society from large and unexpected medical costs incurred by the family. And as any social contract, there would also be an obligation on society. To the extent that the family cannot reasonably afford reasonable basic coverage, the rest of society, via government, should take responsibility for financing that minimum coverage.

    The obligations on individuals does not have to be a “hard” mandate, in the sense that failure to obtain coverage would be illegal. It could be a “soft” mandate, meaning that failure to obtain coverage could result in the loss of tax benefits and other government entitlements."

    hmmm, that kind of "reform" should sound familiar, even if you are flying around the right-wing information cocoon. In my view it just goes to show how right-wing Obama and the democrats are.

  2. @Ian Spencer Dubrowsky - This is not a subsidy to insurance companies, it is actually the opposite. The government is forcing insurance companies to pay for peoples health care who did not have a policy with them before; an obvious and significant money loser.

    Medicare is bankrupting our country already, adding more people to it would seem to be a bad idea.

    I am not a single payer advocate; I am a government get out of the way except for enforcing contracts advocate.

  3. haha right, trillions on military adventures and corporate subsidies, yet its giving people healthcare that's bankrupting us? that's quite the contradiction. I would say the current system is bankrupting us.

    And no you don't seem to understand the policy, the government is forcing insurance companies to cover people, at which point if people can't pay the government gives them a subsidy or tax credit (which is really just another form of subsidy) that goes to the insurance companies. An insurance company actually wrote an earlier version of the law that was passed,spent millions lobbying for it, funding right-wing activism in order to push the policy more and more to the "right" which really just means in their interest- Don't take it from me, take it from your fellow travlelers at the Heritage foundation.

    If the government wanted to get out of the way it would just let people enroll in Medicare, if people don't want to do that then they shouldn't have to. The government is in the way of people now because it protects the interests of insurance companies instead of people's health- which is more and more evidently becoming a major drag on our entire economy.

    like you keep throwing this rhetoric at me about "government getting out of the way", what you mean by that and why you believe that is not at all clear though, I don't know why you think anyone else would find that engaging

  4. >"Medicare is bankrupting our country already, adding more people to it would seem to be a bad idea."<

    No it isn't. There are so many other expenditures that we could examine that contribute to our deficits that to claim that it's Medicare, is completely bogus. First of all Medicare serves the needs of the people. Those who are retired can't take part in employer based insurence, and the cost of individual policies would bankrupt them. The very notion that under the Ryan budget plan, on others, people would get a voucher for around $6,000 to shop for a plan of their own, is absurd. You're telling elderly people to sift through a maze of policies that can only complicate their lives, rather than make life easier. On top of that it'll cost them more then the current system. How can they do that on a fixed income??

    Here's an idea, which I'm sure you wouldn't like but seems to make sense to me. Everyone pays a medicare tax which comes out of their paychecks. It amounts to $2 to $6 dollars. On top of that, they have several hundred a month taken out to pay for their employer based coverage.

    Why not increase the Medicare tax by about 400%? Now each person is paying about $8 to $24 to cover Medicare. By adding 400% to the Medicare fund, we could now afford to cover the nation with excellent coverage including dental and vision. If you had that, you could drop your current coverage, and put around $400 to 800/mo. into your pocket allowing you to spend that money on anything you choose which is great for the economy. You have complete coverage and money in your pocket as well. You might say...raise my taxes??? Are you crazy??? But if that raise is offset by your savings on healthcare, you come out hunreds or even thousands of dollars ahead. If raising your Medicare tax meant you could be completely covered, and drop your current provider and put the amount you are paying them, into your pocket...would you do it? If not..why not?


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