Saturday, November 07, 2009

Criminal Penalties For No Insurance Possible Under Pelosi Bill

From a letter from the the non-partisan Joint Committee of Taxation from Rep David Camp to explain penalties for not carrying insurance under the Pelosi Bill (H.R. 3962):
Americans who do not maintain “acceptable health insurance coverage” and who choose not to pay the bill’s new individual mandate tax (generally 2.5% of income), are subject to numerous civil and criminal penalties, including criminal fines of up to $250,000 and imprisonment of up to five years.
Is this what American's want, criminal penalties including jail time?

If not, I'd suggest you call, fax, or e-mail your Congressman today.



Anonymous said...

It's called a tax, Wes. Just like your income and social securtity tax, if you don't pay them or attempt to avoid paying through fraudulant behavior, you can go to jail or be fined. What did you expect? For them to nicely ask people who break the law for the money they owe?

Named Just Bob said...

I ran a search on HR bill for both "2.5%" and "250,000" neither search found anything related to criminal penalty for not paying.

Named Just Bob said...

I did find reference to a tax of "2.5 percent" on those individuals who do not maintain acceptable insurance throughout the year. The criminal penalties are from the IRS tax code when you further assume that the person is obligated to pay, does not pay. Those who produce fraudulent tax returns are familiar with these criminal penalties already. Let's not build more fear about this bill than already is.

DrWes said...


I'll refer you from the press release from Dave Camp, ranking member of the House Ways and Means Committee which states: "When confronted with this same issue during its consideration of a similar individual mandate tax, the Senate Finance Committee worked on a bipartisan basis to include language in its bill that shielded Americans from civil and criminal penalties. The Pelosi bill, however, contains no similar language protecting American citizens from civil and criminal tax penalties that could include a $250,000 fine and five years in jail.

"The Senate Finance Committee had the good sense to eliminate the extreme penalty of incarceration. Speaker Pelosi’s decision to leave in the jail time provision is a threat to every family who cannot afford the $15,000 premium her plan creates."

Anonymous said...

This is not just a 'tax'. This is a violation of our basic liberties. If you are independently wealthy and are not part of the FICA system with a salary, you will be considered a criminal for not paying money to the government for health insurance that you may or may not want. Our founders must be rolling over in their graves knowing that US citizens are required to pay money to the government to avoid being labeled a criminal. I thought that this is the reason why this country was founded.

Anonymous said...

First, I don't believe the bill creates a $15,000 minimum premium. Second, a 2.5% tax penalty for failing to carry health insurance amounts to $1,250 for an adjusted gross income of $50,000 per year--and anyone with that high an AGI can afford the penalty.

aconn said...

It's not that the bill per se creates a $15,000 premium, but rather the bill requires you to buy insurance with certain features. According to the CBO, that will cost $15,000 in 2016.

Anonymous said...

You only have to pay 1,250 to the government so you won't be a criminal. Oh, right, well our projections were wrong and next year it will be only 2,000. Oops, we did it again...only 5,000 not to be a criminal. How about this? You give the government all of your money and we will take care of you and not lock you up. Government for the government by the government.

Maureen said...

Of course, the irony is that prisoners receive health care at the government's expense!

Anonymous said...

Dr. Wes,

Whoa! You're quoting Dave Camp? For goodness sake. He is the LEAD on the recently submitted REPUBLICAN health care bill. And I think it is fair to say that the republicans would rather have their Mother face "death panels" than have this bill pass. I don't think your post is playing fair. ESPECIALLY since you are the guy who says the devil is in the details. I'm really disappointed with this post. I know you are not in favor of this bill and can present arguements worth discussing. But THIS is not worthy of the serious, thoughtful, doctor I know you to be.

Anonymous said...

Dr. Wes,

I am sick to death of these arguments that, to put it kindly, play with the facts. This guy says the CBO projects insurance costs under health reform to be $15,000 in 2016. Has anyone considered what the same coverage will cost in 2016 without any reform? Give me those numbers and we can talk. Meanwhile, my brother-in-law's insurance through his employer for his family of four will have his insurance costs increased by 37% NEXT year. Any of you guys ready to suggest how much that same employer based insurance will increase by 2016? His insurance presently costs him just over $1000 per month. My guess is that his insurance WITHOUT HEALTH CARE REFORM will cost well over $15,000/yr. Any concerns about that?

And as far as the penalties that are attached, I'm suggesting that those are the same sort of penalties that occur if you don't file taxes or file fraudently. Now perhaps you don't think we should be obliged to pay income taxes. BUT if you accept that we should ALL pay our share of taxes and tax cheats drive you nuts, then kindly be rational and accept the need for penalties if YOU CHEAT ON YOUR TAXES.

Anonymous said...

For the record....

SPECIAL MYTHBUSTER: 'Reform Could Likely Mean Jail Time for Americans Who Don't Buy Insurance'
Congressional DeskNovember 08, 2009As debate heats up on the House floor on historic health insurance reform, House Republicans are pulling out all the stops to scare the American public about the Affordable Health Care for America Act, including speeches today saying that Americans who don´t buy health insurance could face jail time. Below are the facts.

MYTH: "Reform Could Mean Jail Time for Americans Who Don´t Buy Insurance"

FACT: Reform includes a shared responsibility requirement, for those who don´t already have insurance to either purchase affordable health insurance or pay a fee of 2.5 percent of their income so they are not driving up everyone else´s health costs.

Under the bill, the only people who would face the fee for not purchasing insurance are those who can truly afford to purchase such insurance.

For those who can afford insurance but for some reason do not purchase it, they simply pay the fee – a fee designed to cover their costs when they use the health care system. For a small number of people who might refuse to pay the fee, it is important to remember that, in the majority of cases, the IRS – which will enforce the insurance requirement – uses the CIVIL process to settle delinquent penalties and taxes.

It would only be in extremely rare circumstances that criminal prosecutions of any kind would be pursued. Indeed, in 2008, there were 156 million individual tax returns filed in the United States. Out of all of those 156 million returns, there were only 100 criminal prosecutions for willful failure to pay taxes – and only for the most egregious examples of those who willfully defraud the system.

Finally, our bill is designed to ensure that the shared responsibility requirement is never imposed on those who cannot afford to purchase health insurance. Some of the key provisions are:

under our bill, there are generous affordability credits to help people purchase health insurance on the Health Insurance Exchange – with the credits on a sliding scale according to someone´s income;

there is a hardship exemption for those who cannot afford insurance even with affordability credits;

and, the lowest-income Americans will actually qualify for Medicaid. Print Email

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Anonymous said...

Did you ever figure that the reason health care costs continue to escalate is because of the dislocation of prices and lack of transparency by government intervention? No, never let this enter the argument. We must just accept what is for it's own sake and build on that. Health care does need reform. Patients need to understand the full costs of their care. The more money that the government puts into the health care system the more expensive it will get. This is a self fullfilling prophecy. Insurance companies no longer monetize risk--they are now the payer of health care. Your money disappears from your check and you expect the government to give it back to you. Surprise, the money is gone. It has gone to buy the votes to ensure that some politician is re-elected.

Anonymous said...

For those who can afford insurance but for some reason do not purchase it, they simply pay the fee – a fee designed to cover their costs when they use the health care system.

There cannot be an assumption that one without insurance cannot pay for their healthcare and are burdening the system when they use it. Yet this is the assumption in this bill - if you don't have insurance, you're going to increase the cost to everyone else - that might be true for some, but certainly not all...especially for routine medical care.