Complexity Is One Reason Americans Fear Obamacare

Obamacare is very complex and hard to understand, so it's not surprising that many Americans fear the worst from a federal bureaucracy they don't trust. One of the biggest concerns some Americans have with Obamacare is that it will be a law; that will mandate most of us to buy at least a minimum level of health insurance for ourselves and tax dependants by 2014. The "individual mandate" can be satisfied by obtaining coverage through employer-sponsored insurance, an individual insurance plan including those to be offered through the new health insurance exchanges, a grandfather health plan.

Reports from the Congressional Budget Office indicate that out of an estimated 322 million Americans in 2014,  eighty percent will have the mandated coverage. That leaves about 54 million without coverage and violating the law. According to the program, those individuals will owe a financial penalty known as the "shared responsibility payment" which will be a percentage of the insurance premium and household income. Luckily, for the rich, it will have a cap. 

And it will all be assessed and be collected by the IRS. Which is even scarier than being mandated to buy insurance. But, what happens if you are cited for not having coverage, and a fine is actually enforced that you can not pay? Will the feds then bring back debtors prison since the IRS is the entity who is responsible for collecting this debt and have the power to send a person to prison for not paying their taxes.

The Kaiser Family Foundation estimates that 40 percent of the uninsured would qualify for an exemption from the individual mandate for a variety of reasons. Their income could be too low or the cost of insurance could exceed 8 percent of their income, or they could qualify on religious or hardship grounds. Others include members of American Indian tribes, people with incomes below the tax filing threshold, and people who lacked insurance for less than three months during a year. You can also be exempt from the individual mandate if your an undocumented immigrants, religious objectors and or incarcerated

Approximately 48 million people will be covered by government sponsored coverage such as Medicare or Medicaid, or similar federally recognized coverage. That would reduce the pool of mandate violators to about 32 million Americans. Many of those people would qualify for subsidies set up under the law, which are meant to encourage people to buy insurance and help them pay for it. Some of them would do what the law says and buy health insurance.

Also, anyone without insurance who wants to apply for either an exemption or a subsidy, will have to determine where they reside on a kind of income-insurance matrix that measures the relative affordability of insurance, family size, regional cost of living, and other variables that will change every year.

Complexity, may be the real reason Obamacare spooks people. For starters, the law could end up remaking the whole healthcare system, which accounts for about one sixth of the U.S. economy, in ways nobody can predict. The U.S. healthcare system was a mess before Obamacare, with soaring costs and millions of families that couldn't afford care. But that doesn't mean that shaking things up will automatically improve it. Changing things merely for the sake of change often makes things worse, and people are right to be skeptical.

Pending in front of the U.S. Supreme Court is the contention that the individual mandate is not a valid exercise of Congress's legislative powers.  The parties' arguments have centered around three constitutional provisions as a basis for the individual mandate:  the Commerce Clause, the Necessary and Proper Clause, and the Taxing Power. The main constitutional provision at issue is Congress's ability to regulate interstate commerce. Article I, Section 8 of the U.S. Constitution in pertinent part provides that "Congress shall have Power to regulate Commerce with foreign Nations, and among the several States, and with Indian Tribes."

The Supreme Court's existing Commerce Clause cases establish that Congress can regulate any economic activity that Congress rationally concludes is in the stream of or substantially affects interstate commerce. The text of this constitutional provision speaks to Congress's ability to regulate commerce among the states and does not distinguish between economic activity and inactivity.

The argument is that a decision to not purchase health insurance constitutes inactivity, which is not connected to interstate commerce, and therefore is not subject to regulation under Congress's commerce power. Instead, maintain that the individual mandate compels people to enter the stream of commerce, which they argue is an unprecedented use of Congress's commerce power. They maintain that the federal government is one of limited enumerated powers, with all remaining legislative powers residing in the states, which retain the general police power to regulate for the general welfare.

If the Court upholds the individual mandate, this provision of the law will take effect in 2014.  If the Court invalidates the individual mandate, it will then consider whether the mandate is severable from the remainder of the law, which could impact whether the ACA's other provisions, particularly those related to expanding access to affordable health insurance coverage, survive and how they are implemented.  Within the broader context of Congress's legislative powers, the Court's decision may clarify, reaffirm, or reverse course on existing constitutional doctrine, with potentially significant effects on Congress's power to regulate interstate commerce and the constitutional balance of legislative power between the federal government and the states more generally.

What's best for the American people? Changes are always more intimidating when they're poorly understood, and that is certainly one reason that Obamacare is so controversial and highly divisive. Polls show that Americans are about evenly split on their view of the law, with many Republicans strongly opposed to it and many Democrats strongly in favor. At the same time, only about one third of the U.S. say they feel they understand the law.

Everyone facing this healthcare bureaucracy is justified to believe and say, "I'll believe it when I see it." While the passage of this law, and the date it goes into effect, we've been left to ponder over a monstrosity set of new rules from a government that seems hell bent on not doing us any favors. The government ought to first prove its worth and effectiveness, and only then ask citizens to take this leap of faith and accept more complexity. It's hard to believe we need to make the system even more confusing in order to simplify it.