IRS finalizes penalties for Obamacare "individual mandate"
August 28th, 2013
02:38 AM ET
8 months ago

IRS finalizes penalties for Obamacare "individual mandate"

(CNN) - The Internal Revenue Service has issued finalized rules for the individual mandate portion of the Affordable Care Act, President Obama’s healthcare plan.

The individual mandate penalty has long been one of the contentious components of health care reform, with lawsuits questioning the constitutionality of the law reaching the Supreme Court.

Under the new rules, individuals choosing not to carry insurance are subject to a penalty of $95 per person each year, or 1% of household income, whichever is greater, beginning in 2014. Over time, the penalty increases, so that by 2016 the penalty is $695 per person, or 2.5% of household income. Subsequent years will be calculated based on a cost-of-living formula.

The IRS also specified what constitutes the minimum level of coverage under the new law.

Several exceptions exist to the individual mandate, including those people who lack insurance while temporarily unemployed, or those individuals whose health care is supplied by a temporary staffing agency.

Those who qualify for Medicaid, but live in a state that has opted out of the new expanded program, such as Texas, Pennsylvania, or Wisconsin, will also be exempt from the penalty.

The individual mandate penalty goes into effect on January 1, 2014.


Filed under: Health care • IRS
soundoff (32 Responses)
  1. The Great Pontificator

    This is so stupid it's not even funny. I know of someone who had to get their own insurance. The cheapest plan they could find, and a horrible plan at that, was 600-700 dollars per month. So any fool who can do basic math can see that rather than paying 600 or 700 dollars a month, just pay the 95 per year penalty fee. These people still have to be covered though. So what happens is that the cost of covering all these people is spread to those who do pay for insurance, thus driving insurance costs up even more. The effects of this are what is being counted on to drive private insurance out and pave the way for the blessed single payer national (socialist) insurance. I know people who post here think that is great, but it really isn't.

    August 28, 2013 04:35 am at 4:35 am |
  2. Rob

    When is someone going to finalize the punishment for all the IRS employees that targeted political for Obama;s party gain. Guess that is just one of the many crimes this administration will sweep under the rug. Of course they will punish people for not buying into the train wreck Obama and the dems created against the will of the people

    August 28, 2013 05:42 am at 5:42 am |
  3. ghost

    There should be a penalty for those companies that cut workers hours to avoid providing health insurance. And it should be very severe. It is time for the greed to stop. CLINTON 2016

    August 28, 2013 05:44 am at 5:44 am |
  4. king

    i wonder if these backward teapartiers will decide to take the penalty instead of getting healthcare. you know their hatred is that high so i put nothing past them. the problem is they still have to pay the penalty plus thousands of dollars out of their own pocket. i guest their hatred breeds stupidity beyond an average person comprehension

    August 28, 2013 06:37 am at 6:37 am |
  5. Gurgyl

    Gop needs to know it is the Law. Lex loci.

    August 28, 2013 06:58 am at 6:58 am |
  6. Scott

    Just another way for Obama and the Democrats to stick it to the average working guy. This is so wrong on so many levels.

    August 28, 2013 07:26 am at 7:26 am |
  7. the hippies were right

    Individual Mandate? This is so wrong! Every individual should be free to date woman also! The conservatives aren't gonna like this law.

    August 28, 2013 07:46 am at 7:46 am |
  8. What's in that tea anyway?

    @Fair is Fair,

    You must be twisted like a pretzel....You are a conservative that believes that people should "pull themselves up by their bootstraps", you know that "rugged american independence".....yet you continue to support the GOP / Tea troll philosophy; a person shouldn't be required to get insurance....big gubmit, blah blah blah...... Ok, again, please explain your twisted logic for people that walk into an emergency room, have no insurance and no ability to pay, ultimately leaving the rest of us with insurance to cover those charges? How is that a good thing? And if you have nothing but your usual rhetoric which makes no sense anyway, don't bother answering (because I already know you can't) It just amazes me that people that actually graduated high school remain in the GOP/Tea lunacy. Well do your usual approach... Just go back hating progress, using the twisted logic with no antidotes, and finding excuses for remaining in the "stupid party" Not my words, blame Jindahl.

    August 28, 2013 08:11 am at 8:11 am |
  9. GSMITH

    President Obama is a thief. Stealing our money because we have to purchase an item we may not want. President Obama you are a disgusting SOB and I hope some day you suffer what you are doing to this Country.

    August 28, 2013 08:13 am at 8:13 am |
  10. Econ301

    The Great Pontificator

    So any fool who can do basic math can see that rather than paying 600 or 700 dollars a month, just pay the 95 per year penalty fee. These people still have to be covered though. So what happens is that the cost of covering all these people is spread to those who do pay for insurance, thus driving insurance costs up even more.

    --------------------------

    So you mean the it'll be just like before ACA except now they eventually pay $695 a year (when fully phased in) instead of $0 dollars a year?

    You think that before ACA we were not heading towards socialism, when people who paid for insurance were paying 100% for people who didn't, instead of now where we are paying 70%.

    August 28, 2013 08:18 am at 8:18 am |
  11. Rudy NYC

    The Great Pontificator

    This is so stupid it's not even funny. I know of someone who had to get their own insurance. The cheapest plan they could find, and a horrible plan at that, was 600-700 dollars per month. So any fool who can do basic math can see that rather than paying 600 or 700 dollars a month, just pay the 95 per year penalty fee.
    ------------------
    Interesting. Conservatives were all for the idea when the Heritage Foundation promoted it. The individual mandate isn't the real problem. The real problems are the mandates put on the health insurance providers: a cap on profits; no longer refuse for pre-existing conditions; kids on parents' policy until age 26, cannot drop people when they sick or reach certain ages, no more lifetime caps on benefits paid out, etc.

    Anyone who's paying $600/month for individual health care is the real fool. Since I don't believe people are that stupid, I'm not going to beileve your story. Another factor that can increase your premium is your state not participating in the ACA at all. Blame your governer and state legislature.

    August 28, 2013 08:19 am at 8:19 am |
  12. RandyIA

    @Gurgyl

    Gop needs to know it is the Law. Lex loci.
    ======================
    I keep hearing this, but I also keep hearing the left support Obama when he delays portions of of. Exactly how does that work?

    August 28, 2013 08:20 am at 8:20 am |
  13. Econ301

    GSMITH
    President Obama is a thief. Stealing our money because we have to purchase an item we may not want. President Obama you are a disgusting SOB and I hope some day you suffer what you are doing to this Country.

    ---------------–

    Every President ever has been buying things some people don't want. Did you want that Bridge in the middle of nowhere?
    Did you want all those bombs and tanks? All of them?

    Seriously grow up.

    The cost of living in society is not always getting what you want.

    August 28, 2013 08:27 am at 8:27 am |
  14. What's in that tea anyway?

    Wasn't the individual mandate an idea hatched by the Heritage Foundation in the '90s...yes, yes, I believe it was. Not exactly a liberal organization to say the least......Think the head of that organization is NOW "Sen Waterloo" himself Jim Demint. How ironic is that? I couldn't have dreamed of a better ending to his political career than to now try and lead the misled GOP/Tea sinking ship...perfect symmetry for the party of non-ideas, non solutions...not even their own. Not only a party that couldn't spell logic, or truth, or pragmatism, but the inability to remember its own ideas.

    August 28, 2013 08:30 am at 8:30 am |
  15. Vince

    American picked him twice. It's the law. Get over it. Move on.

    August 28, 2013 08:37 am at 8:37 am |
  16. kirk

    Well I understand Smith your used to paying nothing then of course paying your own way us a sin.why pay for something your used to getting for free, ibcantctell you Fuzhou number if times I have been in the er for me or my kids and someone is there to have a scratch looked at I wish I could afford to have every little thing looked after by a doctor, sad thing us I pay for his so I can't afford mine, enough

    August 28, 2013 08:40 am at 8:40 am |
  17. What's in that tea anyway?

    You really have to work hard as a GOP/Tea mush mind because you have to forget truth, history, facts and ideas developed by your own party.....finally you have to have hypocrisy that's as big as Texas to think that today's problems weren't created if not exascerbated by Lil Dubya's, foreign policy follies or his unfunded Medicare part B (mission accomplished).....Texas is a big state – LOL Ok GOP / Tea Trolls continue to stamp your little feet like children hating to take the medicine for the ills you caused upon this country.....That will get you back to the White House for sure ...LOL

    August 28, 2013 08:42 am at 8:42 am |
  18. Rudy NYC

    GSMITH

    President Obama is a thief. Stealing our money because we have to purchase an item we may not want.
    --------------------
    Hello. There are already laws on the books that make yiou purchase things. Let's skip auto insurance, okay. There are laws that say you must where shoes and clothing in public, which means you most likely will go to a store and purchase some. There are laws that say you must feed your kid, which means you most likely will go to a store and purchase food.

    As far as whether or not you want it, everyone needs health care at some point in their lives. No one is forcing you to buy broccoli. You can survive and live a long life without broccoli. You are far less likely to survive and live a long life without health care. If you are like most people the US, you probably wouldn't even be alive today if not for health care, especially if you were born in a hospital.

    Conservatives always brag about their "values", how they believe that people should pull their own weight and not look for handouts from others. I say you should show some of your "values" and have health care when you go see a doctor or visit an emergency room, instead of relying on the benevolent innocence of those with health care who are paying higher costs support those who wish to get by on someone else's nickel.

    August 28, 2013 08:46 am at 8:46 am |
  19. bill pike

    the penalty has already been given before obamacare-socialism. We have seen this admin. head us down a road called big government, let the government take care of you, food stamps for everyone, debt, and SOCIALISM which only has one more detour before COMMUNISM. All our founders warned us about obamaists but here we are. Glad I am in my older years and won't see us totally destroyed by socialsist-we lost the war from within.

    August 28, 2013 08:53 am at 8:53 am |
  20. RandyIA

    @Vince

    American picked him twice. It's the law. Get over it. Move on.
    ========================================================
    And again I say. I keep hearing this, but I also keep hearing the left support Obama when he delays portions of it. Exactly how does that work?

    August 28, 2013 08:55 am at 8:55 am |
  21. GSMITH

    It seems Democrats do not know what the word Freedom means, please look it up in the dictionary. Freedom is not punishing someone for not buying a service or product. Obama is a Socialist Anti-American and no matter what the law says it is not enforceable.

    August 28, 2013 09:08 am at 9:08 am |
  22. The Real Tom Paine

    -GSMITH

    It seems Democrats do not know what the word Freedom means, please look it up in the dictionary. Freedom is not punishing someone for not buying a service or product. Obama is a Socialist Anti-American and no matter what the law says it is not enforceable.
    *************
    We are have been punished already by having to cover people who are NOT insured. Freedom is about meeting your obligations within the society, not about bailing out whenever you please. The SCOTUS has decided the Individual Mandate is constitutional, so take the matter up with Justice Roberts.

    August 28, 2013 09:37 am at 9:37 am |
  23. The Real Tom Paine

    All this ranting about a loss of freedom because your employer is obligated to offer you health insurance is nonsense. A real, free society involves everyone particpating and doing their part to ensure that the society remains free, NOT by opting out because they object to something. The people ranting about freedom are doing their best to destroy it by refusing to live up to those obligations and ideals. Its not about impulsively running around like a child, its about duty and serving your community by doing what needs to be done: whether you like it or not is irrelevant. There are plenty of things I object to, but I won't destroy our free society because of my own selfishness.

    August 28, 2013 09:44 am at 9:44 am |
  24. Rudy NYC

    GSMITH

    It seems Democrats do not know what the word Freedom means, please look it up in the dictionary
    --------------------
    It seems conservatives don't recognize their own personal "values", such as taking personal responsiblity for paying for their own health care. As one Repubilcan famously said, people can get free health care at the emergency room.

    August 28, 2013 09:51 am at 9:51 am |
  25. Anonymous

    Freedom is not punishing someone for not buying a service or product.

    You either don't have health insurance to cover your own needs and can therefore insist you are losing your freedoms or you do have health insurance covering your own needs and are upset others are getting the same health care you are getting. Which is it? Those who don't have health insurance use Emergency Rooms as their personal health care insurance. Ultimately we all pay for their free cost through our own higher health insurance rates and our own medical treatments being offered by the same facilities that treat the uninsured for free because these facilities are then forced to raise the cost of our treatment to cover the cost of the free treatments being offered to the uninsured.

    August 28, 2013 10:07 am at 10:07 am |
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