IRS Enforcement Could Decide Success or Failure of Obamacare

Image: IRS Enforcement Could Decide Success or Failure of Obamacare IRS Commissioner Danny Werfel

Monday, 25 Nov 2013 07:07 AM

By Melissa Clyne

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For Americans who choose not to buy health insurance the tax man probably won’t be coming anytime soon, The Washington Post reports.

Politicians, pundits and the press have been crying foul about Obamacare’s myriad failures since its Oct. 1 launch, but it turns out much of the program’s success or failure will ultimately lie with the IRS, the agency responsible for fining Americans who don’t buy health insurance.

The lawmakers who drafted the Affordable Care Act, known as Obamacare, hog-tied the IRS in its ability to collect fines for the uninsured — $95 in 2014 or 1 percent of income, whichever is greater. The IRS is barred from usual penalties such as liens, foreclosures and criminal prosecution. Its only remedy is to garnish tax refunds for those who over paid their taxes, according to the Post.

“Most people who really want to game the system will probably get away with it,” writes Forbes contributor Howard Gleckman, who characterizes the tax as a “mouse.”

Enforcing compliance with the law is one of the IRS’ nearly four-dozen new responsibilities resulting from Obamacare. The 2,400-page legislation mandates that every American carry at least “minimum essential coverage.”

Health economists warn that if the young and healthy don’t participate, an “insurance death spiral” will result in skyrocketing costs and premiums to cover the sick and elderly.

Weak enforcement will sink Obamacare, according to health-care industry consultant Robert Laszewski, president of Health Policy and Strategy Associates.

“I now think there is little hope we are going to get enough younger healthy people to sign up, and that means that this law is in grave danger of financial collapse,” he warned.

IRS Commissioner Danny Werfel insists his agency is prepared to take on its new responsibilities, which also include helping distribute trillions of dollars in insurance subsidies.

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Obamacare Burdens Shift to States as Mandate Rollback Creates New Woes

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