Individual mandate tax for Obamacare attacked by HouseIn a new development for President Obamas signature legislation, the House of Representatives passed legislation yesterday which would reduce the Obamacares individual mandate tax to $0. The vote passed by 90 votes, with 250 representatives voting for the reduction and 160 voting against.
Whats also interesting is the number of swing voters with 27 Democrats voting for the tax reduction, 27 more than the number of Republicans who voted for Obamacare when it passed. Only one Republican, Paul Broun of Georgia, voted against the measure with 223 Republicans voting for the bill.
What does the White House think? The administration has continued to argue that Obamacare is doing exactly what it was supposed to do, mainly, helping millions of Americans stay on their parents plans until age 26. But the three paragraph statement offered by the White House did not specifically address the issue proposed by the vote. The President has also noted that if the legislation somehow does make it to his desk, he would veto it.
What will come of the individual mandate tax?
Experts note that unlike other efforts by Republicans to derail Obamacare this action seems to have bipartisan support. Not only did it pass the House of Representatives by a wide margin, there is also some talk the Senate will actually take a vote, pass the bill, and give Obama that chance to make good on his word to veto it.
What is the individual mandate?
If youre as confused as many Americans you may not understand the Federal health law's individual mandate, which was one of the key building blocks of the insurance overhaul. Under the mandate most Americans are required to purchase health insurance or pay a tax. This proposal has been attacked by conservatives since its inception, although it did survive a constitutional challenge.
Whats surprising, however, is that many Americans remain unaware that the mandate exists. But it does, and it will require you to get medical coverage either through your job, public programs such as Medicare or Medicaid, or an individual policy that you purchase. So if you are one of the more than 57 million people younger than 65 who now do not have insurance its time to get to work.
The goal of the individual mandate tax
The goal of the mandate was to reduce the costs of healthcare for everyone. Experts suggest without the mandate and the accompanying individual mandate tax there would be very little incentive for healthy individuals to purchase insurance coverage. And we all know what happens when only the sick buy insurance coverage--- prices skyrocket.
Individual mandate tax insufficient incentive
So while the idea of the individual mandate tax may be noble, others suggest the mandate will be ineffectual because the individual mandate tax penalties are set so much lower than the cost of coverage. For instance, if you do not get coverage you can expect to pay up to $95 per adult and $47.50 per child, or 1 percent of family income, whichever is greater for the first year. The fine will increase over time, however, and will rise as high as $695 per adult and $347 per child (up to $2,085 for a family) or 2.5 percent of family income, whichever is greater by 2016.