After 3 days of Health Care Reform Supreme Court Hearings, a central components debated is the constitutionality of forcing an individual to purchase health insurance. Certainly it would be costly if one could just opt out at any time and then come back in you would be left with a high risk pool.
The same analogy would hold true with auto insurance where only the risky drivers would only participate making it impossible to afford coverage. Just imagine buying a health plan on the way to the hospital? Coining this alternative as “ambulance-care” would be more fitting than “ObamaCare”.
Of course there are Individual Mandate penalties. So how does the penalty work?
In 2014, the penalty for being without health insurance is $95 per adult and $47.50 per child (up to $285 for a family) or 1.0% of family income, whichever is greater.
In 2015, the penalty for being without health insurance is $325 per adult and $162.50 per child (up to $975 for a family) or 2.0% of family income, whichever is greater.
In 2016, the penalty for being without health insurance is $695 per adult and $347.50 per child (up to $2,085 for a family) or 2.5% of family income, whichever is greater.
As of now, there are no known method to enforcing the penalty if you don’t buy insurance and you don’t pay the penalty. In fact, the law specifically states that no criminal action or liens can be imposed on you but I am certain that will change. I would also think that if a large numbers of people continue to choose not to enroll and the cost of premiums increase, the chance to revise the low penalties and increased enforcement are inevitable.
In conclusion, the Supreme Court ruling set for June is worth watching but only for legal wonks. With average health insurance single rates costing $600/month wouldnt you pay the penalty and just opt out?