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Some individual mandate discussion

Just because I think it's good to keep posting reminders of how the Affordable Care Act will work, here's Tim Noah on the individual mandate:

The individual mandate will be phased in between 2014 and 2016. The new law says that if you don't buy health insurance, you'll have to pay a fine of either $695 or 2.5 percent of your income, whichever is higher. People who don't earn enough to pay income tax or who, if forced to purchase health insurance, would end up spending more than 8 percent of their annual income, are exempt.

What if your failure to obtain health insurance means you owe the penalty but you nonetheless refuse to pay it? That's where things get tricky. The IRS can't throw you in jail, because the health reform law explicitly states (on Page 336): "In the case of any failure by a taxpayer to timely pay any penalty imposed by this section, such taxpayer shall not be subject to any criminal prosecution or penalty with respect to such failure."

It does appear, however, that the IRS can deduct the penalty from tax rebates you'd otherwise get. It's all very civil.

In case you want to dig deeper on this, the Center for American Progress and Jonathan Gruber have released a paper on why the individual mandate is needed and Austin Frakt has a good discussion of how the individual mandate has (or, in some cases, hasn't) worked in Massachusetts,

By Ezra Klein  |  April 9, 2010; 9:07 AM ET
Categories:  Explaining health-care reform  
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Next: A post that will help your parents yell at you

Comments

"reminders"???? There has been no setting forth of how it will actually work, how you will now secure the services of your doctors who are going to be working under a whole new set of rules, how you will pay them, how you will secure and prove you have insurance that is acceptable to Barack Obama, and so on. What you have written comes as news to me as it must to many people. Not in the category of "reminder."

Posted by: truck1 | April 9, 2010 9:34 AM | Report abuse

Can we also have "Some Public Plan Option Discussion"? I am so confused by what the role of this OPM-contracted pseudo-public non-profit multi-state option will be in the new system...

Posted by: ajh2003 | April 9, 2010 9:56 AM | Report abuse

No Stupak blog Ezra? Obamacare just claimed it's first congressional victim. I'd think you'd be all over that.

Posted by: RobT1 | April 9, 2010 10:17 AM | Report abuse

i'm actually optimistic that the individual mandate will work.

who knows maybe its because its friday.

Posted by: visionbrkr | April 9, 2010 10:47 AM | Report abuse

I see this health care legislation as breaking the log jam. Our compassion which rightfully allows free emergency care for everyone is at odds with denial of non-critical care for those who cannot afford it. As we procede it will be obvious the real problem is affordability but we had to take this first step however oblique. This insane reaction from the right where folks are ready to fight another civil war to preserve another inhumanity shows we have learned nothing.

Posted by: BertEisenstein | April 9, 2010 10:56 AM | Report abuse

I hadn't picked up on the exclusion from the mandate of those not earning enough to pay federal income taxes. That is a little less than one-half of all households. Are that many people really exempt from the mandate? If so, then don't they have major incentives to game the system?

Posted by: Ken36 | April 9, 2010 11:13 AM | Report abuse

Yes, but what's to stop the IRS from just making lack of health insurance and lack of paying the fine a red flag for a full audit? Go through one of those and paying the fine might look pretty attractive.

Posted by: AuthorEditor | April 9, 2010 11:55 AM | Report abuse

My 12 year old daughter has to write a report on the ACA (this is impressive because we live in Italy). With her permission I quote her view that it was stupid because it wasn't complete and, in particular, because the penalty for not buying insurance is so low.

I converted $ 847 to Euros and she said "dad that's my allowance ... which you haven't paid in months." Thanks for reminding her Barack.

I did explain that it is the larger of 847 and 2.5% of payroll income (ok I said income -- she's 12). Her view is that it is insane to let people game the system that way.

I note again that she is 12 and that only people roughly her age (such as Ezra Klein) seem to be able to grasp this point.

Posted by: rjw88 | April 9, 2010 3:42 PM | Report abuse

Yes I know I overstated the penalty which is min $695 not $847. No idea where I got the idea it was $847.

Posted by: rjw88 | April 9, 2010 3:45 PM | Report abuse

rjw88-- Ask you daughter how she would feel about taking $695* and flushing it down the toilet. Because that's what the mandate penalty is. And you still don't have health insurance.

*Actually I'm guessing you would pay 2.5% of income because $695 is only up to $27800 for a family of 4. I'm assuming you aren't a single parent with three kids working at Walmart in Italy.

Posted by: bmull | April 9, 2010 5:44 PM | Report abuse

Fellow liberals-progressives: Via SCOTUS, corporations now have essentially unlimited power to try to buy even more federal government. Question: If this mandate is upheld, then what in the US Constitution keeps government from mandating that we buy other things from corporations buying government? Answer: Nothing. This mandate allegedly derives from VERY broad constitutional power to tax or regulate interstate commerce. If upheld, it therefore gives bought-by-corporations government VERY broad constitutional power to mandate that we buy whatever these corporations sell. Government mandating that we buy from corporations buying government? A future Bush or Cheney (or Palin?) with virtually unlimited constitutional power to tax or regulate interstate commerce now can mandate that we buy whatever his or her corporate buddies sell? Wow! What a country! -------- State "opt out" clauses make unconstitutional laws less unconstitutional? Future government dominated by religious conservatives - modern Republicans - can now use such power to further their agenda, like mandating buying and using explicit context filters for computers and TVs (to save America's children) and outlawing women crossing state lines to get abortions by including state "opt out" clauses? -------- Still think this mandate OK or this state "opt out" clause makes it OK? Beware of what you wish for - you just might get it. There is NO end to this VERY dangerous slippery slope. This mandate violates our rights, at least one of which must be implicitly covered by the 9th Amendment. Where are the true civil libertarians?

Posted by: Keefanda | April 9, 2010 6:58 PM | Report abuse

Ezra - you have no idea whether the process of collecting the fines will be "civil" or not.

The Dumbo will be out of office anyway, and we'll have this repealed.

It's unconstitutional.

Posted by: easttxisfreaky | April 9, 2010 9:16 PM | Report abuse

Keefanda - Mark Levin.

Posted by: easttxisfreaky | April 9, 2010 9:19 PM | Report abuse

To follow up my April 9, 2010 6:58 PM message: Any argument for the need of the individual mandate is useless. Why? Obama and the Democratic Party were being stupid when they dealt away the public option to the corporations. Give the corporations what they want, guaranteed business forever with individual mandates to buy whatever they sell no matter how bad it is and no public option way out, eh? NOTE: In Massachusetts, 82% of all who voted for Obama in 2008 and then for Brown in 2010 want a public option, and 86% of all who voted for Obama in 2008 but stayed home in 2010 want a public option.

So many in 2008 turned out to reverse The Reagan Destruction, to take up where FDR and Johnson left off. Instead, with corporate deals, voucher systems, mandates, and no public option, they got ROCKEFELLER REPUBLICANISM.

Obama and the Democratic Party think that those so very many who turned out in 2008 for freedom from corporate pillaging will turn out in 2010 and 2012 after being so betrayed? Obama and the Democratic Party, in spite of their claims, have yet to heed THE MESSAGE OF MASSACHUSETTS: Stop dealing away to the corporations what people desperately want and need, kick the corporations out the door, and again meet the needs of the people with strong government services (like Medicare for all who want it) and strong laws and regulations (like on all banking) - or witness SIGNIFICANT staying-home and/or protest voting.

Posted by: Keefanda | April 10, 2010 6:54 AM | Report abuse

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