The individual health care mandate won't work.
As almost every American today knows, the individual mandate is a central feature of the health care law recently upheld by the Supreme Court. The mandate requires most Americans to carry "minimum essential" health care coverage. President Obama and the law's supporters claim that this measure will radically reduce the number of uninsured Americans.
It won't.
Even before the Court's decision, the Obama Administration projected that 4 million Americans would pay the penalty tax of the new law, rather than acquire health insurance. In the wake of the Supreme Court's decision, it is clear that the health care mandate will not increase insurance coverage by anywhere near the numbers forecasted by President Obama. There are three reasons the individual mandate won't work as touted.
First, many uninsured Americans will pay the tax rather than purchase health care insurance because the tax will be substantially less than the premiums they would have to pay for insurance. Indeed, the Court's opinion, written by Chief Justice Roberts, is virtually an invitation to Americans to pay the cheaper tax rather than the more expensive premiums for insurance coverage.
In the words of the Chief Justice: "Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes." And, the Chief Justice further notes, "for most Americans the amount due will be far less than the price of insurance." Thus, in a highly public way, the nation's highest judge legitimated the choice of paying the tax rather than buying insurance.
The second reason the mandate will fail is that, even when Americans eschew insurance coverage, the IRS has limited authority to enforce the resulting tax. Congress' misgivings about the mandate were so great that, when it passed the law, it specifically prohibited the IRS from proceeding against taxpayers' assets if they refuse to pay the tax. The IRS can withhold the mandate tax from a taxpayer's refund. If, however, there is no such refund, the IRS is powerless to enforce the tax.
Thus, many Americans will neither purchase insurance nor pay the tax -- and nothing will happen to them.
In theory, Congress could give the IRS full authority to enforce the individual mandate tax. In practice, this is unlikely.
If stronger IRS enforcement authority is unlikely, the third reason the mandate will fail is that enforcement of the mandate by other government agencies is permanently off the table as a result of the Court's decision. That decision, while sustaining the individual mandate as a constitutional exercise of Congress's taxing power, rejected the mandate as an exercise of Congress's authority under the Commerce Clause. Under the Constitution, the Commerce Clause is the national legislature's prime source of regulatory authority.
Suppose, for example, that a future Congress, more supportive of the individual mandate than is the current Congress, decides on stronger enforcement of the mandate through federal criminal law. Suppose, for example, that this future Congress wants to declare the willful failure to obtain insurance a federal misdemeanor.
Under the Court's decision, this future Congress could not proceed in this fashion since such a criminal law would be an exercise of the Commerce Clause power and the Court has held that the mandate is not a valid exercise of that power.
At the end of the day, the individual mandate will disappoint its proponents as many Americans will pay the tax rather than obtain insurance -- and many Americans won't even bother paying the tax because they will face no consequences from nonpayment. Future generations will look back on us and wonder what the fuss was about.
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Mortgage lenders have to report mortgage interest payments to the federal government with a copy to the mortgagor. This one requirement adds a certain amount of cost to doing business and it is passed along to borrowers. What will be the cost of this new requirement to in some way report insurance?
If you don't have insurance, you will not be getting an insurance confirmation from your carrier. States do not require auto insurance companies to provide a notice of coverage to the regulators, but they do require a notice when insurance is cancelled. Do you have any idea how many people simply lie on their tag renewals and list a false insurer when they don't want to pay for minimum auto coverage? Obviously, the state will never get a cancellation notice for something the driver never had in the first place.
How many additional IRS agents will be required to enforce the mandate and where will their pay come from? This whole mandate enforcement thing is going to be a cluster foobis of the first order.
The only thing that will change is we will have large new taxes on medical devices, drugs and insurance that will be passed through to inflate medical cost even further, and we will have a lot of 20-30 year olds whose insurance is now being paid for by parents that will become the burden of the taxpayer.
Obamacare will become another huge entitlement that does nothing to change cost drivers, in fact lights a fire under them.
Sure the US would probably behave similarly to Massachusetts if the national health care law was identical to the Mass health reform law, but it's not even close.
It's not to burn uninsured people, it's to protect insured people from getting burned by those who refuse to take care of themselves....when they have the means.
Uninsured ER charges are far less than insurance billings. Try consulting an uninsured ER patient and checking. The difference between an insured billing and an uninsured's charge can be as high as 65%. Common sense should indicate avoiding middleman insurance processing costs reduces cost of service. No insurance has zero relation to Medicaid--contracts and otherwise. That's why it's termed no insurance, which means, er, none. Zero. Zip. There is private insurance, there is Medicaid/Medicare, then there is no insurance. Get your head out of your statistics, however sourced, which by your conclusions, are flawed, and and try doing bona fide research. Unless, of course, the intent is to mislead by asserting flawed conclusions, rather than inform. A caveat willfully overlooked is there is upwards of 30 million uninsured, who know your assertions are bunk.
There's got to be something seriously wrong with this picture.
A Democratic President faced with a Republican Congress that refuses to allow the IRS to take civil actions to collect from people who fail to pay the penalty tax for not getting health insurance still has the power to instruct the Department of Justice Tax Division to make prosecution of willful failure to pay cases a priority.
Some people still couldn't be able to afford care and they'd be reliant on charity or out of luck but for everyone else prices would go way down.
Nope it's a side show. Just as the GOP not expanding Medicaid is a joke. If hospitals, clinics and doctors continue to be required to treat ever more unisured, they'll close or go bankrupt. Or raise prices for the insured, which will lead to ever larger premium increases for less care for the insured.
States like Vermont that go Medicare for all and use ALL the available money from the Federal Gov. will lower the premiums by broadening the base of paying customers.
The end result is that those states with quality and affordable medical infrastrurcture will attract the high paying quality jobs and those that don't the lower paying ones.
Does that mean that the ACA should not have been attempted? People have waited decades for SOMETHING in the way of healthcare reform, and every year, premium rates have been going up and up, so that coverage became more and more unaffordable for more and more people...a really sweet setup for insurance companies, but not such a good deal for us.
The longer we had to wait for something to be done, the less of a chance there was of something actually being done. Now that it IS actually done, we can put it into effect, and start working the "bugs" out of it...just like we did with Social Security and Medicare.
I don't think the mandate is the most efficient way to deal with costs, but there's no point in misrepresenting its role.