Kaiser Health News looks at the expanded role that the Internal Revenue Service will have if Democrats’ pass their health care legislation. Most notably, both the House and Senate bills would require Americans to submit proof of insurance with their federal tax returns, or else they will face a tax for not complying with the mandate to be paid to the IRS. While the article mainly focuses on the logistical challenges posed by the new responsibilities given to the IRS, it doesn’t explore another potential problem — tax non-compliance.
The individual mandate won’t affect most Americans, who are already covered either through existing government programs or through their employers. Those most inclined to be uninsured by choice — and thus likely to be most resistant to the mandate — are the so-called “young invincibles” who have low health care costs and can’t justify paying the expensive monthly premiums. In fact, according to Census Bureau, 8 million of the uninsurerd are between 18 and 24 years old and 10 million are between 25 and 34. Members of this subgroup are also more likely to work on their own, or do cash intensive jobs such as bartending or waiting tables, where it’s easier to float below the radar and avoid filing tax returns. Though it’s difficult to quantify, it would seem that individuals in this position would be less likely to file tax returns after Obamacare is implemented if doing so meant the added burden of presenting proof of health insurance, or facing an additional tax penalty.