Sunday, 2 December 2012

ObamaCare's Unenforceable Tax

In the Daily Dispatch, Reason magazine Senior Editor Jacob Sullum writes:

Last week, the Republican-controlled House of Representatives voted to repeal the Patient Protection and Affordable Care Act, aka ObamaCare. It was the 33rd such vote taken by the House and, since Democrats control the Senate, no more likely to be successful than the first 32.

The day before the vote, however, the House Ways and Means Committee heard testimony that highlighted another, more promising way to override the health care law: Americans can refuse to comply with its command that they obtain government-approved medical coverage, which the Supreme Court has deemed a mere suggestion even though it is essential to the legislation’s goals. Furthermore, if ObamaCare objectors take a simple precaution, they can opt out without paying the prescribed penalty.

ObamaCare requires insurers to take all comers and charge them the same rates, regardless of health. Those rules create two problems that reinforce each other: They raise premiums, and they encourage people to delay buying medical coverage until they’re sick. 

As more healthy people go without insurance, rates rise further to make up the difference, which encourages more people to go without insurance, which increases rates further still. To avoid such a “death spiral,” ObamaCare commanded young, healthy people to “maintain minimum essential coverage” as defined by the government, thereby subsidizing the medical expenses of older, sicker people.

Read the full column here.

Related:

Reason on health care and the Supreme Court.

Rachel Ward Carrie Fisher

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