Howard Gleckman of Tax Vox writes about the complicated IRS tax credit scheme the Baucus Healthcare Plan creates in order to subsidize the requirement that all Americans have insurance:
Still, these subsidies are the key to health reform. The government can’t make insurance companies sell to all comers unless everybody is required to buy. Otherwise, healthy people won’t purchase coverage until they need it, and this adverse selection will drive premiums through the roof. However, if government is going to force people to buy insurance, it must provide enough of a subsidy so they can afford coverage. Hence, the banana.
Gleckman rightly questions whether the already overburdened IRS will be able to handle these new chores:
Is running all this through the Internal Revenue Service the most efficient solution? Somehow I doubt it. The Service is understaffed and overwhelmed as it is. Baucus would require the agency to verify income, citizenship, and changes in marital status; and share some individual tax information with insurance exchanges. It would also have to impose excise tax penalties on those people who refuse to buy coverage. It isn’t a job I’d be anxious to take on.
2 responses so far ↓
1 Backdoor Taxes Part Deux // Sep 30, 2009 at 9:29 am
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2 IRS Failed to Answer 22 Million Taxpayer Calls // Oct 7, 2009 at 7:26 pm
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