Individual Mandate Fails ObamaCare


The architects of ObamaCare knew they had a problem. They wanted to get people to buy a product they weren’t convinced they needed. When a business faces that problem they usually resort to a marketing campaign to change the public’s mind. When the government faces the same problem, they make you pay a tax for failing to purchase their product.

I’m referring to The Individual Mandate tax that compels every American to purchase health insurance, if not provided by their employer, or pay a penalty to the IRS. This is the first time in the history of our country that the government has been able to compel the citizens to purchase something or pay a penalty.

On June 28, 2012, in a 5 to 4 decision, the Supreme Court ruled that the law was constitutional insofar as the Individual Mandate was concerned; but not because they agreed that Congress could compel individuals to purchase a product.

Chief Justice John Roberts, a conservative, sided with the four liberal justices to form the majority opinion. However, he did not agree with the reasoning of the government that they had the authority to impose a mandate to purchase insurance thus denying their argument this is embodied in the Commerce Clause. Instead, he concluded they were in fact imposing a tax, as Republicans had argued, and the Constitution did give them the authority to impose taxes.

Justice Roberts wrote, “Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness. Simply put, congress may tax and spend. The federal government may enact a tax on an activity that it cannot authorize, forbid or otherwise control.”

The four other conservative justices had strong dissents. Justices Anthony Kennedy, Samuel Alito, Clarence Thomas, and Antonin Scalia opposed the decision. In his dissent, Kennedy wrote: “In our view, the entire act before us is invalid in its entirety.” He believed the majority opinion constituted a rewriting of the law. He said, “What Congress calls a penalty, we call a tax. In short, the court imposes a tax when Congress deliberately rejected a tax.”


Response to The Individual Mandate

The response of the public to this mandate has been unimpressive. The tax in 2014 was only $95 or a maximum of $285. But in 2016 the tax will be $695 or a maximum of $2,085. Will this higher tax have a greater impact? Perhaps.

A Gallup poll taken after the start of the second enrollment period in 2014 indicated The Individual Mandate was the most unpopular part of ObamaCare. Only 37% of Americans approved of this mandate. It remains even more unpopular than the law itself, which has never enjoyed majority support.

People are forced to make a difficult choice – purchase an expensive health insurance policy that they probably won’t need or pay the Individual Mandate tax. Ironically, the risk of not having health insurance has been mitigated by the fact that ObamaCare allows them to purchase health insurance after they get sick yet not be denied treatment for a pre-existing condition. Thus far, many have chosen to pay the tax instead of purchasing the insurance. (For a third alternative see ObamaCare Spurs Growth in Healthcare Sharing Ministries.)

The impact of those choosing the tax instead of the insurance has been far fewer people with health insurance than the architects of ObamaCare expected. The Congressional Budget Office March 2010 estimates figured 26 million uninsured by 2015 and 23 million uninsured by 2019. But the March 2015 estimates figured 35 million uninsured in 2015 and 26 million in 2019. This last estimate is hugely optimistic and has little chance of being achieved under the current law.

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