IRS may have to enforce proposed insurance mandate

Under the new healthcare legislation that has been proposed, the Internal Revenue Service would be charged with ensuring that American citizens had health insurance Kaiser Health News and USA Today report. Citizens who fail to comply with the mandate would be financially penalized by the tax collecting organization. 

The IRS also would be in charge of divvying up $140 billion in annual subsidies to help those who likely will struggle with such a mandate, such as small businesses and lower-income individuals and families, according to the Congressional Budget Office. Overall, the CBO anticipates that the IRS--which has a yearly budget of $11.5 billion--will need as much as $10 billion to cover the costs of its new role in the first decade alone, money that has yet to be accounted for in any of the proposed healthcare legislation. 

Furthermore, critics of the healthcare overhaul point to the IRS's failure to fulfill its current duties as reason to be skeptical (in 2005, the IRS failed to collect $290 billion in taxes). "It's hard to see how the IRS could take on the huge responsibility it would be given under the pending healthcare legislation without some real glitches, or worse," Sen. Charles Grassley (R-Iowa) said. 

Mandating healthcare coverage is not without precedent at the state level; Massachusetts in 2007 began such a program, lowering the number of uninsured in the state from 7 percent to 4 percent. The state's Department of Revenue had the job of ensuring that citizens were covered, and were not given any extra funding or manpower to do the job. In 2008, only 45,000 residents (1.3 percent of filers) were forced to pay a no-coverage penalty. 

To learn more:
- check out this Kaiser Health News/USA Today story