Is the individual mandate enforceable?

Great Debates
#1

Listening to various pundits and reading various sources I get the impression that the individual mandate isn’t really enforceable.

As I understand it, the law gives collection responsibility to the IRS but apparently doesn’t have any penalties for failing to pay the penalty (or tax or whatever the hell it is) and doesn’t allow liens.

About the only thing the IRS can do is withhold the money from any refund that is due. If so, then anyone who doesn’t receive a refund gets off scot-free. If your refund is lower than the penalty then you end up paying only part. You can, of course, change your deductions to make sure there’ll be no refund for them to withhold.

However, I’m also hearing that the IRS is hiring thousands of new agents to enforce the penalty.

So what’s the truth here? Is the mandate at all enforceable?

If it’s not, how will it affect the insurance companies that are now faced with having to take all applicants at any time, including people who wait till they’re sick to apply?

#2

The ACA allows for (and I expect insurers to adopt) a yearly “Open Enrollment” period. So, if you wait until you get sick, you could conceivably wait for a year to buy insurance.

#3

I apologize for responding to only ask about this point, but what exactly is the evidence that this is the case? I see the claim made here that 16,000 agents will be needed to enforce “Obamacare” but it offers no proof of this dubious assertion. It is also debunked by factcheck.org.

#4

I’ve heard time and time again that the only way the mandate can be enforced is by taking it out of any tax refund you may have otherwise been entitled to.

I don’t know if that’s accurate but that seems to be the common wisdom.

#5

I don’t have any evidence, that’s why I’m asking. I’m trying to discover the truth. Thank you for the factcheck link.

#6

Do you have a cite for that?

#7

I have no idea what the actual plans are but it would be easy enough to have an item on the tax return: “Do you have health insurance?” If “no” then the penalty/tax for being uninsured applies. Enforcement is the same as for any other item that might be falsified on a tax return, subject to being audited and then punished according to tax fraud regulations.

#8

You’re welcome. And I apologize for seeming to imply you believed this was a known fact. I did not mean to do so.

#9

Sure, in the act itself (PDF) item 6, Section 1311 on page 72.

Or in this article from the Health Affairs blog.

I am gobsmacked this has gotten so little press compared to “people will just sign up when they get sick”. I guess lies make for better press and sound bites.

#10

Surely you’re not just figuring this out now? :slight_smile:

#11

How do you like that? The media sure has been getting that wrong.

#12

The mandate’s tax, or penalty, or personal responsibility fee, or whatever you want to call it, is pretty much unenforceable. I believe this was done to make a very unpopular policy palatable. The last thing supporters of the ACA need are martyrs being hauled off to jail or having liens placed on their homes. Presumably, if the ACA became more popular, they’d change the law to allow normal IRS enforcement.

#13

During a “plans for your tax return” discussion at a party, one guy complained about his returns being taken for years by the government because of some debt (specifics forgotten). I asked him why he didn’t just change his deductions so that he would pay less all year and either get no return or maybe owe a bit. He:smack::smack::smack::smack:

#14

So tell me, did he ever decide to follow your advice to become a tax cheat? I don’t make this statement lightly, not that I’m some kind of moral paragon, mind you, but isn’t that what it boils down to?

In this article from Slate.com, IRS Commissioner Doug Shulman says

It seems that, at least in April of 2010, the IRS felt it would have to, at least in part, rely on the honesty of the American people to get the mandate.

#15

How exactly is it cheating to purposely not overpay?

#16

A cheat in the context of knowingly owing money to the government and manipulating his tax return to avoid paying it. Since doing so in a way that in and of itself (altering deductions) isn’t illegal, perhaps tax cheat isn’t the right term. But he’s still not paying off his debt.

#17

kayaker, I’d like to apologize for my statements up-thread. It was stupid of me to suggest that you would advise someone to possibly break the law. For all I know, you made some flippant remark to some guy, and he took it seriously. It was inappropriate of me.

#18

We’re cool. I have no idea the specifics of the guy’s situation, but couldn’t understand why he created a need for a refund that he then didn’t receive.:slight_smile:

#19

They have, but this seems to have even worse consequences. So not only must a purchase a product from a private company on the market, if I get dissatisfied with the service I’m receiving from the private company that I’m forced to buy from, I can’t change to a different private company and buy from them until next year???

That’s ridiculous. You decide to give your business to the local grocery store and it goes to shit: terrible service, dingy aisles, rotten produce. Should you have to wait for a year to go to a different grocery store down the street? That’s the whole point of the market to allow free competition.

#20

That’s just the thing though, the court ruled that Congress cannot compel the purchase of health insurance. So it’s not actually the law that you have to have health insurance, and if Congress really thought people who neither paid the penalty nor had health insurance were cheats, they’d have the courage to go after them properly.

Given the way the law is written, the mandate to have health insurance is equivalent to the Florida law that “unmarried people may not live together and commit lewd acts.”, or the Florida law that says it is illegal for single women to parachute on Sunday.