Penalizing the Non-Participant: National Health Care Reform IS Massachusetts Health Care Reform
Andrew had a contemporaneous post on Massachusetts health care reform, which includes the stick of a tax penalty on those who refused to participate. Note that the stick gets bigger from 2008 to 2009. Note also that Mass’ reform has not accomplished its goals, though the author provides little to bolster her conclusion that national health care reform would fix everything that ails the health care system of Massachusetts and the rest of the country.
Now, from HR3200:
SEC. 59B. TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE.
(a) Tax Imposed- In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of–
(1) the taxpayer’s modified adjusted gross income for the taxable year, over
(2) the amount of gross income specified in section 6012(a)(1) with respect to the taxpayer.
(A) IN GENERAL- The tax imposed under subsection (a) with respect to any taxpayer for any taxable year shall not exceed the applicable national average premium for such taxable year.
So the penalty equates to the premium you “should” be paying. Let’s see, pay a tax penalty or pay a premium. If I chose the penalty, will I dodge this experience?
By the way, HR3200 exempts the following groups from the penalty.
(1) DEPENDENTS- Subsection (a) shall not apply to any individual for any taxable year if a deduction is allowable under section 151 with respect to such individual to another taxpayer for any taxable year beginning in the same calendar year as such taxable year.
(2) NONRESIDENT ALIENS- Subsection (a) shall not apply to any individual who is a nonresident alien.
(3) INDIVIDUALS RESIDING OUTSIDE UNITED STATES- Any qualified individual (as defined in section 911(d)) (and any qualifying child residing with such individual) shall be treated for purposes of this section as covered by acceptable coverage during the period described in subparagraph (A) or (B) of section 911(d)(1), whichever is applicable.
(4) INDIVIDUALS RESIDING IN POSSESSIONS OF THE UNITED STATES- Any individual who is a bona fide resident of any possession of the United States (as determined under section 937(a)) for any taxable year (and any qualifying child residing with such individual) shall be treated for purposes of this section as covered by acceptable coverage during such taxable year.
(5) RELIGIOUS CONSCIENCE EXEMPTION-