Main Builder of Obamacare Wants Bigger Penalty for Those Not Choosing Coverage

The penalty for those choosing not to have health insurance this year is 2.5% of taxable income, or $695, whichever is more. The penalty is about what someone would pay for a bronze plan on the health care exchange, the plan with the minimum amount of coverage. So yes, that doesn’t sound like a lot, and that’s one of the major flaws of the ACA, according to Jonathan Gruber, one of the main architects of the law. “That’s something I think, ideally, we would fix,” he tells the Hill. “…I wish the mandate penalty was stronger.”

There are not enough young and healthy people in the insurance marketplaces; about 1 million fewer people have signed up than expected. This comes in the wake of the Obama administration’s announcement this week that exchange premiums are expected to rise an average of 25%. Those hikes are unlikely to affect the majority of ACA beneficiaries, however, thanks to tax credits and cost-sharing subsidies. Still, the risk pool remains a problem.

The Hill: “Gruber said stricter penalties would prevent what he described as ‘individuals who are essentially free-riding on the system’—echoing concerns that are frequently raised by insurance companies.”

Source: The Hill