MOORLACH UPDATE — Health Insurance Mandate Penalty — June 25, 2019

The Book of Proverbs in the Old Testament, written mostly by King Solomon, is replete with exhortations to not oppress the poor. Consequently, I followed up on the observation I made in my last UPDATE (see MOORLACH UPDATE — Half Empty Reserve Concerns — June 24, 2019).

Yesterday afternoon, on the Senate Floor, I asked if 82% of the lower salaried taxpayers in the state paid for the Affordable Care Act mandate penalty in 2014. I did not receive a direct response. We were told the lower-paid residents would receive a supplement to offset their medical insurance costs.

I guess our lower-earning residents, like those just starting their careers, will have to do more math. Which is less expensive? Paying health insurance premiums and, hopefully, receiving some form of state subsidy, or just paying the mandate penalty?

Giving Medi-Cal to undocumented residents is unbelievable just by itself. But, forcing poorer legal residents to underwrite, by restoring the Affordable Care Act mandate penalty in California, it is oppressive. The trailer bill to do this was approved on a party-line basis, with one Democrat abstaining.

The Associated Press covers the topic in the KCRA Channel 3 piece below.

California Legislature OKs health insurance mandate

By Adam Beam

The California Legislature voted Monday to tax people who refuse to buy health insurance, bringing back a key part of former President Barack Obama’s health care law in the country’s most populous state after it was eliminated by Republicans in Congress.

The tax now heads to Democratic Gov. Gavin Newsom, who proposed a similar plan in January – an indication he will likely approve it.

The federal Affordable Care Act required everyone to buy health insurance or pay a penalty. The U.S. Supreme Court upheld the law, ruling the penalty was a tax.

In 2017, Republicans in Congress eliminated the penalty – beginning this year – as part of an overhaul of the federal tax code.

The bill passed by Democrats in California would reinstate the tax, effective Jan. 1. No Republicans voted for it. One Democrat in the state Assembly – Rudy Salas Jr. – voted against it.

The penalty won’t apply to everyone, including people living in the country illegally. Lawmakers on Monday also approved a bill that would expand government-funded health insurance to low-income young adults living in the U.S. illegally.

People in prison and those who are members of an American Indian tribe are also exempt, mirroring what had been in the federal law.

Democrats say the plan is part of their efforts to make sure everyone in California has health insurance.

If the bill becomes law, California would join Massachusetts, New Jersey, Vermont and Washington, D.C., next year as the only governments in the U.S. to penalize people who don’t buy health insurance.

It would also make California the only state to use money it gets from the penalty to help people who earn as much as six times the federal poverty limit pay their monthly health insurance premiums.

That means a family of four earning up to $150,000 a year would be eligible.

“These new subsidies will impact almost 1 million Californians and help them get the health care access that they deserve,” said Democratic Assemblyman Phil Ting of San Francisco.

Republican state Sen. John Moorlach said in 2014 that 82% of Californians who paid the penalty for not having health insurance had taxable incomes of $50,000 or less.

“This trailer bill will take money away from people making $30,000 to $50,000 a year and give it to people making between $75,000 and $130,000 a year,” GOP Assemblyman Jay Obernolte said. “That makes no sense.”

The state has already extended government health benefits to children living in the country illegally. The plan approved Monday would extend that coverage to people as old as 25.

While the proposal easily passed the Legislature, it brought a rebuke from Democratic Sen. Maria Elena Durazo from Los Angeles. She criticized the bill for not providing health care coverage to people 65 and older living in the country illegally.

“We’ve missed an opportunity to create fairness and inclusion,” she said.


This e-mail has been sent by California State Senator John M. W. Moorlach, 37th District. If you no longer wish to subscribe, just let me know by responding with a request to do so.

Also follow me on Facebook & Twitter @SenatorMoorlach