The ObamaCare End-Around: Escalate the Fines for Not Signing Up at the Beginning

Well there seems to be a built-in fall back that the White House can take if the individual mandate in ObamaCare is declared unconstitutional.

Medicare's coverage for doctor visits is voluntary and carries a separate premium, yet more than nine in 10 older people sign up. The reason is simple: Those who opt out when they first become eligible face a lifelong penalty that escalates the longer they wait.

The same kind of penalty could be incorporated into the health care overhaul to replace its current mandate that all those who can afford a policy must get one. It would be a stiff nudge to enroll healthy people who are potentially reluctant. That's needed to help keep premiums affordable because the law takes away the ability of insurers to turn away sick people.

In other words if the person buys health insurance at 26 (when they come off of their parents plan) they will face no fine. But if they choose to go without health insurance and then decide to buy it at 36 they could face a huge penalty for non-compliance 10 years ago. This seems perfectly legal because Medicare has it the same trick in it and that wasn't declared unconstitutional.

One bad thing jumps right out at me though. Why would you sign up at age 36 or 46 or any time thereafter if you failed to do so at 26? I mean you would be on the hook for big penalties so there will be a financial disincentive to signing up later on. So if you could not afford to pay for health insurance at 26 (like many people who are just starting a career) you are screwed later on when you actually have the money to buy health insurance.

So the choice is to either have less money at 26 or pay a big fine later on. So you could possibly go your whole life without health insurance because you could not afford to buy in at 26. What this does is create messed up behavior like people not wanting to accept their companies insurance because they cant afford to pay the fine when they are enrolled. Then you will have some companies dropping their insurance because their employees cannot afford to pay the fine to sign up.

The funny part is that the only people that will take this one in the face is 20 somethings that voted Obama into office. They have to make the choice to buy a product that they statistically don't need for the sole purpose of making things cheaper for older people. Then they might even get penalized for waiting to make the decision to buy the thing when they can actually afford it. I wonder if this is the hope and change that they voted for?