Affordable Care Act Woes (Obamacare)

[D1984]

Also, just an FYI for anyone worried about what might happen if you don't buy insurance on the exchanges and then get in a car accident or have a burst appendix or heart attack or the like:

http://ccf.georgetown.edu/all/health-pl ... g-the-aca/

http://www.kaiserhealthnews.org/Feature ... plans.aspx

http://www.npr.org/blogs/health/2013/10 ... -cut-costs

The gist of it is this: Any health insurance policy deemed "short term" (which under the law is "anything less than 365 days" ) is NOT required to conform to the PPACA mandates (it may be required to conform to state laws and mandates but that was the case even before Obamacare). In other words, medical underwriting is still allowed, no community rating, no guaranteed issue, nothing about max out-of-pcoket being capped at $6K, no regs banning lifetime limits or requiring coverage of ten "essential services"  whether you wanted them or not, etc. The only bad thing is that one still technically owes the penalty since this is not "qualified coverage" but the penalty is--at least at this point--a tiger without any teeth.

Now, traditionally these "short-term" policies were from maybe 30 days to five or six months....basically just a "tide-me-over-between-jobs" option for people who didn't want to elect COBRA coverage because it was too expensive. Well, what happened is that BCBS and a few other insurers have started to offer policies that are issued and good for all of 364 days so as to just barely skirt the law's requirements. SInce these don't have to conform to the Obamacare regs and mandates, they may well be a LOT cheaper than an exchange policy, particularly if one is young and relatively healthy.

Of course, such coverage has to be re-underwritten and renewed every 364 days but that's the beauty of the thing when combined with Obamacare...if you are still healthy, great; go ahead and re-apply and renew your coverage for another year minus one day....OTOH, if you have a major medical issue within the year, you're covered for basically the whole year until the current policy term expires and then (since you know you'd fail underwriting at that paint and be denied coverage by the short-term insurer) you just go to the exchange and buy a policy there.

Now, why didn't the PPACA's authors think of this happening....can you say "adverse selection city"?

[smurff]

Fix it how? If it required a law to put the mandate itself in then logically it would require a law modifying it so that wages could be garnished, assets liened, property seized, etc. Good luck getting that sort of law through as long as the Rs control at least one house of Congress

Have you forgotten that the IRS is lawless?  That's a perennial complaint about the agency.  They've driven people to suicide with their collection tactics.  Unless the IRS does not want to collect the penalty money (fat chance), they'll find a way to get it--even if they have to "give it back" five years later after losing a lawsuit.

The thing about the IRS is that as long as there is already a provision within an existing law for a tax, penalty, or fee to be collected by them, they don't need another law allowing them to actually collect through the tax system.  (BTW, I don't know whether Obamacare has this provision--it's a complicated law with all kinds of counterintuitive stuff happening within it.)  They'll just make a regulation about it, publish it, and include it on Form 1040 or one of the Schedules.  Sure, there will be lawsuits and challenges to their authority, but unless someone figures out how to do these challenges in advance and do them successfully, those lawsuits will be AFTER the IRS collects the money.

[Reub]

Smurff is correct. The IRS will get their money from you, even if they have to wait for you to die to get it. With interest!

[RuralEngineer]

Not to derail, but this was absolutely priceless.

http://news.yahoo.com/healthcare-gov-su ... 41521.html

During her testimony at a congressional hearing regarding the "debacle" of the HealthCare.gov launch, Health Secretary Kathleen Sebelius said that while she acknowledges serious problems with the site, it "has never crashed. It is functional, but at a very slow speed and very low reliability, and has continued to function."

Cue the website crashing.

[D1984]

Reub,

IIRC, the law states that the debt from not paying the mandate penalty is only for ten years (although it rolls over so in year 11 if someone didn't pay the penalty fo that year then they would then owe the penalty--and interest--for years 2 through 11 as year one got dropped off but year eleven got added on).

smurff,

Weren't most of the IRS abuses where the IRS either:

A. Already clearly had the law on its side? In other words, something like "structuring" or "money laundering" where they could legally forfeit assets WITHOUT a trial and the accused (or technically, the property of the accused) was "guilty until proven innocent" (not saying I agree with such forfeitures or with their "guilty until proven innocent" doctrine--as I don't and if I were in charge of the government then forfeiting someone's property without a conviction would be illegal whether it was the IRS or any other agency doing it--but the law as written does currently clearly allow that).

B. Cases where the government had PAID refunds that were not due, (EIC fraud, false credits like the slavery reparations credit, bogus returns with income zeroed out based on a tax protetster's stating that "income" was different than what the IRS said it was, etc), sometimes even for more than the taxpayer would have owed in tax had he actually paid, and then the Service used some rather heavy-handed and aggressive methods to collect what it felt it was owed.

C. Cases where there was disagreement on an arcane technical detail of tax law (debt vs equity and the resulting deductibility of payments or lack thereof, substance over form, business purpose, constructive dividend payments, step transaction doctrine, eleven factor test, twenty factor test, etc) where the taxpayer argued one side and the IRS argued the other and the Tax Court sided with the IRS and then the IRS seized assets, garnished wages, and the like to collect?

D. Incidents like with Larken Rose or Nick Jesson bragging (on the public record and out in the open....even in a half page article in the NY Times if memory serves me correctly) that they paid nothing in taxes even if it was owed and then all but daring the IRS to do something about it (which the IRS more or less promptly did).

I'm not saying that the IRS hasn't ever unjustly gone after someone  (I agree that they have...for instance, levying fines and then seizing assets from one spouse for what the other spouse owed...or coming after employees even though it was the employer's fault for choosing not to withhold payroll taxes on them) but many of the "legitimate" lien/levy/garnishment/seizure cases do fit into one of the four categories above where at least on paper the IRS had some official right to try and collect.

PPACA, on the other hand, is pretty clear that the penalty cannot be collected through garnishments, levies, liens, seizures, etc and that no one can be criminally prosecuted for not paying it. I'm not saying that the IRS couldn't collect somehow (maybe suing someone and then getting a judgment and THEN collecting???...is that even legal under PPACA?) but this is not a simple case where they can (legally) just seize your bank account and say "prove you paid the penalty or that you had insurance if you ever want your ten thousand dollars back".

This is not just my opinion; several prominent tax lawyers and law professors share it as well: http://www.usatoday.com/story/news/nati ... s/3310355/

Finally, the IRS was skittish for a few years after the Roth hearings in 1997 (David Cay Johnston wrote extensively about this in Perfectly Legal); who knows if the recent fiasco with the Tea Party 501c4s and the undue scrutiny they received (and the resulting hearings and grillings before Congress) will make them less eager to act like such bullies again...at least for a few more years.

Of course, if Congress DOES change the law to actually put teeth into the penalty, all bets are off.

[smurff]

Of course, if Congress DOES change the law to actually put teeth into the penalty, all bets are off.

Congress can't sign such a law today, not with the criticism of the launch of Obamacare.  But in the future, when comes along the right mass news event--the kind of event that gets round the clock news media coverage, like:

another mass shooting,

bombing or similar terrorist event,

overseas attack against a large number of Americans (whether civilian or military),

a spree killing mass murderer moving across the country,

the death of a (young) major celebrity,

earthquake or serious weather event (hurricane/superstorm, snowmeggedon, derecho, a bunch of F4 or F5 tornadoes) affecting a major USA metro area--

Congress will do what they tend to do during those times:  quickly sign legislation they know they could not get away with if the public (via the news media) were paying attention.

[Rien]

Rights are politically-created ideas.

Very well said, I am going to steal that from you! 

[MediumTex]

Rights are politically-created ideas.

Very well said, I am going to steal that from you! 

I once had a history professor who reminded the class that if someone is thrusting a bayonet at you and you hold up a copy of the Constitution, the bayonet will go right through it.

He told us to always remember that during discussions about "rights".

[Bean]

Not to derail, but this was absolutely priceless.

http://news.yahoo.com/healthcare-gov-su ... 41521.html

During her testimony at a congressional hearing regarding the "debacle" of the HealthCare.gov launch, Health Secretary Kathleen Sebelius said that while she acknowledges serious problems with the site, it "has never crashed. It is functional, but at a very slow speed and very low reliability, and has continued to function."

Cue the website crashing.

My work's info session had this website listed for reference.  The entire auditorium erupted into laughter.

[Reub]

Comedian Jackie Mason Skewers Obama, ACA on Air:

http://www.newsmax.com/Newsfront/jackie ... /id/534736

"He's saying things that nobody believes. He was always lying every day of his life. Every time he talks, it was a lie. The only time he told the truth is when you didn't hear from him. This is becoming so ridiculous, that even the biggest liar can't top himself.

He looks at you straight in the face and tells you that if you want your plan, you got your plan, you keep your plan. Now, a month and a half later, you got no plan, you lost your plan, and he tells you you still got a plan," the comedian said."

[Rien]

http://www.youtube.com/watch?v=E9r93OxpE8g

As an outsider I am very curious how the US citizens will handle this. Will they simply bend over and "take" it? Or will this be the straw that breaks the camel's back? What is left of the freedom urge of the founders? I am just very very curious.

[Reub]

Unfortunately, it seems that politics is now just about "teams". If your "team leader" blatantly lies its fine because, well, he's on your "team".

[Benko]

Unfortunately, it seems that politics is now just about "teams". If your "team leader" blatantly lies its fine because, well, he's on your "team".

I would argue that they believe the end justifies the means; "by any means necessary"; Bill Ayers; Alinsky

"You Don't Need A Weatherman To Know" where all this leads.

[Jan Van]

As an outsider I am very curious how the US citizens will handle this. Will they simply bend over and "take" it? Or will this be the straw that breaks the camel's back? What is left of the freedom urge of the founders? I am just very very curious.

Of course they'll take it. What will they do? Start a protest movement like Occupy? That will get suppressed. Another Tea party? Marginalized. Only money talks over here...

[Reub]

Obama denies ‘you can keep it’ videotaped promises:

"President Barack Obama told his enthusiastic supporters Monday night that he never promised what video recordings show him promising at least 29 times.

The videos show Obama promising 300 million Americans that “if you like your health-care plan, you will be able to keep your health-care plan, period."

But that’s not what he really said, Obama announced Monday in a speech to about 200 Organizing for Action supporters, gathered at the St. Regis hotel in D.C."

“What we said was you could keep it if it hasn’t changed since the law was passed,”? he told Obamacare’s political beneficiaries and contractors."

http://dailycaller.com/2013/11/05/obama ... -promises/

This is why we need a new economic condition besides inflation, deflation, tight money, and prosperity..... Call it "falsification".

[ns2]

The headline on Drudge about the election in VA is probably too early to be trusted but if it holds up this could be significant....

CUCCINELLI 52.38%
MCAULIFFE 39.97%

Cuccinelli is a Republican candidate who was determined to make the election a referendum on Obamacare.

Mcauliffe is Democrat Machine politics in its purest form whatever democrat machine politics might currently be, but certainly enthusiastic about Obamacare.

The last thing I recall reading was that Mcauliffe would win handily.

So maybe not but we shall see.

[Pointedstick]

Cuccinelli's toast.

[ns2]

Cuccinelli's toast.

71% of the vote is in and Cucinelli's ahead still by 3% according to Drudge.

So I suspect your are right and he really is toast. In this kind of race your really need a lot bigger lead than that to win the home stretch against the political machine.

[Pointedstick]

I'll be extremely surprised if McAuliffe ends up conceding. Still, stranger things have happened.

[Pointedstick]

How did I know that Cuccinelli was going to lose?

Purple state + libertarian spoiler + views that alienate women and enrage/energize liberals = loser

[Jan Van]

[quote=Cuccinelli ]This blows! [/quote] 

[Reub]

How did I know that Cuccinelli was going to lose?

Purple state + libertarian spoiler + views that alienate women and enrage/energize liberals = loser

Do you think a libertarian candidate garnering 7% of the vote who was funded by an Obama bundler might have been the difference? Take this Democratic "plant" out of the equation and it's close to a landslide for the Republican.

http://townhall.com/tipsheet/katiepavli ... e-n1737981

Wait a minute! This is the same strategy that allowed Bill Clinton (McAuliffe's mentor) to defeat George H. W. Bush in 1992, using 3rd party candidate Ross Perot as the spoiler. Will coincidences never cease?

[Jan Van]

Or does it show that a more to the center republican might have done quite well? A rino as Tea partiers might say...

[Pointedstick]

Do you think a libertarian candidate garnering 7% of the vote who was funded by an Obama bundler might have been the difference? Take this Democratic "plant" out of the equation and it's close to a landslide for the Republican.

http://townhall.com/tipsheet/katiepavli ... e-n1737981

Wait a minute! This is the same strategy that allowed Bill Clinton (McAuliffe's mentor) to defeat George H. W. Bush in 1992, using 3rd party candidate Ross Perot as the spoiler. Will coincidences never cease?

Yes I agree, if conditions had been more favorable to Cuccinelli, or if he had been more successful in countering his opponent's tactics, he might have won.

[Benko]

Or does it show that a more to the center republican might have done quite well? A rino as Tea partiers might say...

Because running "center republicans" has worked out so very well in multiple recent presidential elections?

Beware non-conservatives trying to be helpful (see e.g. McCain).