Perhaps the most surprising element of the U.S. Supreme Court's upholding of Obamacare's individual health insurance mandate was the grounds upon which Chief Justice John Roberts upheld it: that the fine imposed for not buying government-approved health insurance was not a fine at all, but a tax.
But that conclusion wasn't so shocking to at least one conservative watchdog: Grover Norquist's Americans for Tax Reform (ATR).
It might surprise you to know that we did not have any problem, at all, with what Justice Roberts said about the tax component of Obamacare, Ryan Ellis, tax policy director for ATR, tells Sunshine State News. We don't agree with the mandate or believe it's constitutional, but we've been calling it a tax since 2009.
Beginning in January 2014, most Americans will have to purchase a government-approved health insurance plan (i.e., one included in a federal or state-based exchange); those who do not will be charged a heavy fine, which for most people will amount to 2.5 percent of their adjusted gross income.
Justice Roberts, who wrote the Supreme Court opinion upholding the constitutionality of the individual mandate, said that even though the law itself refers to the fine as a penalty and never a tax, that imposition is effectively a tax imposed by the government on those who are not health insured.
It was misrepresented that the court ruled that 'the individual mandate was a tax'; you probably heard that a million times, but it's not true at all, it's not what he said, Ellis explains. A mandate is not a tax; a mandate is when the government says 'Do this, or else.' The 'or else' in this case is the tax.
Ellis predicts that most uninsured Americans will probably go ahead and pay the fine, which will be significantly lower than the cost of purchasing health insurance. For example, someone making $100,000 annually, who for whatever reason does not want to purchase insurance that can cost him or his family between $5,000 and $10,000, will probably opt to pay the $2,500 tax (2.5 percent of his income) and effectively save himself between $2,500 and $7,500.
Incidentally, the individual mandate is one of several taxes that violates the president's oft-repeated pledge not to raise taxes a single dime on families making less than $250,000 a year.
One ironic likely side effect of the individual mandate, Ellis notes, is that millions of Americans who might be spurred to finally purchase health insurance will probably elect to enroll in high-deductible health plans and health savings accounts, which ideological liberals tend to oppose.
Liberals want people, when they walk into the doctor's office, to have no extra cost for anything, Ellis explains. For some reason, they think that's the only way people can handle it, that people cannot approach health care like they would any other commodity or service they're purchasing.
We [on the right] disagree: If someone is smart enough to purchase a tablet device and choose between an iPad and a Kindle Fire, then they're smart enough to do the same thing with health care, like they do with groceries.
There are millions of consumer decisions that people make every year. Health care shouldn't be any different.
Reach Eric Giunta at egiunta@sunshinestatenews.com or at (954) 235-9116.
