The Constitutionality of the Individual Mandate for Health Insurance

Once President Barack Obama and Democrats in Congress have passed a health care reform bill, conservative groups are likely to challenge parts of it as unconstitutional, arguing that it oversteps Congress\u27s powers. A key target will be the individual mandate, which is designed to coax uninsured persons into purchasing insurance. The term “individual mandate” is misleading for two reasons. First, the law would not actually require all individuals to purchase insurance. The mandate would not apply to dependents, persons receiving Medicare or Medicaid, military families, persons living overseas, persons with religious objections, or persons who already get health insurance from their employers under a qualified plan. Second, it is not actually a mandate. It is a tax, which people would not have to pay if they purchased health insurance. The House bill imposes a tax of 2.5% on adjusted gross income if a taxpayer is not part of a qualified health insurance program. The Senate bill imposes what is called an “excise tax” — a tax on transactions or events — or a “penalty tax” — a tax for failing to do something (e.g., filing your tax return promptly). The tax is levied for each month that an individual fails to pay premiums into a qualified health plan