California Insurance Mandate: Another Reason to Leave

Tomorrow is a deadline that's largely escaped notice, but to those who are affected the financial penalties are significant. [bold added]

Californians who do not receive health insurance through their jobs or public insurance programs have until Friday to sign up for health coverage for 2020 — or face a tax penalty....California for the first time is requiring all residents to buy insurance or pay a tax penalty of $695 per adult and $347.50 per child under 18, or 2.5% of one’s annual income, whichever is higher.

It's been widely reported that Congress repealed, effective 2019, the individual mandate in the Affordable Care Act (ACA). However, that's technically not what happened; the language for the ACA's mandate was left in place while the penalties for not buying insurance were reduced to zero.

The California penalties are the same as Obamacare's (graphic from visitorscoverage.com)

The elimination of penalties at the Federal level will result in some healthy, uncovered people to choose to remain uninsured. California has reinstated the penalty at the State level and will provide subsidies to push uninsured Californians on to the rolls.

The ACA was a hoped-for step on the way to the progressive dream of universal coverage under a single-payer system. The election of Donald Trump and Republican control of Congress in 2017-2018 not only halted that effort but partially reversed it.

California Democrats, which hold the governorship and super-majorities in the state legislature, tried to pass universal health insurance in 2017. But that effort died in committee in 2017 primarily due to cost estimates in the hundreds of $billions, and no serious attempt has been made to resurrect the bill.

But back to the California version of the ACA mandates and penalties: we'll see if the populace views the benefits as being worth the costs, or whether some productive individuals will just have another reason to leave the formerly Golden State.

My betting is on the latter.