IRS Rules on Obamacare Without
Congress to Penalize Business

By Michael Reagan

The Obama administration has been issuing so many decrees lately that it‘s difficult to keep track of the latest outrage.

Particularly when each fresh glaring consequence — including the encouragement of a “children’s crusade” that is currently invading our southern border — overshadows the last.

But it‘s important that we not allow new lawlessness to distract us from the mother of all White House lawlessness: the continuing rewriting and interpretation of Obamacare to suit their whims.

Now the Obama administration is using the coercive power of one of its favorite bureaus — the Internal Revenue Service — to force businesses to provide health insurance for employees regardless of previous management decisions or whether or not the business can bear the expense.

You may recall that Obamacare put into effect an employer “mandate” — that all companies are required to give health insurance to their employees. But the law also understood that some companies could not afford full insurance, so it allowed them to opt out and pay a fine to the federal government. The current fine is $3,000 per employee per year.

Now, the IRS has decided to reinterpret Obamacare and fine employers an excise tax of $100 per day for each employee who obtains health insurance on an individual basis from a healthcare exchange. The “tax” totals up to a grand sum of $36,500 per year per employee affected — enough money to bankrupt many firms that are just holding on in Obama‘s economy.

It‘s important not to confuse this new fine with the existing fine for companies with more than 50 employees that failed to provide any health insurance. That fine was actually part of the law passed by Congress. This new fine is something the Obama administration cooked up on its own without any congressional consent.

The existing fine for not providing insurance is bad enough at a maximum penalty of $3,000 per employee. The new fine is much more pernicious because it penalizes companies that have been trying to do the right thing by their employees for years, while the fines for businesses that do nothing are far less.

The companies affected by the edict previously gave their employees tax-free cash contributions so they could purchase coverage on their own that was uniquely suited to their individual situation. To use a word from the left, it empowered employees to take responsibility for their own care and make their own decisions.

Andrew Biebl, a tax partner at CliftonLarsonAllen in Minneapolis, explains that the idea of giving workers money to buy their own insurance preceded Obamacare by many years. “For decades, employers have been assisting employees by reimbursing them for health insurance premiums and out-of-pocket costs. The new federal ruling eliminates many of those arrangements by imposing an unusually punitive penalty.”

Obamacare‘s one-edict-fits-all philosophy eliminates personal choice in favor of collective coercion.

Supporters of Obamacare have the gall to accuse employers who utilized the previous option of conspiring to “dump” employees on the Obamacare exchanges. But if Obamacare is such a boon for the nation, how can helping your employees buy Obamacare coverage be “dumping?”

Particularly when using taxpayer dollars to subsidize purchasing the very same healthcare insurance is described as a breakthrough in social justice?

The IRS justifies the new rule by claiming that giving employees money to purchase a plan could result in the purchase of a plan that is substandard. But that disingenuous reasoning purposely ignores the fact that Obamacare eliminated so-called substandard plans and in fact the only plans available on the exchanges supposedly have Obamacare‘s gold seal of approval.

Working hand-in-glove with this new rule are Obama administration bureaucrats who desperately want to keep companies purchasing Obamacare insurance, regardless of the damage soaring insurance premiums may do to the company’s bottom line.

So forcing demand for insurance purchases is only part of the plan. The other part is manipulating the law so that the insurance companies don’t price the plans high enough to cover their costs during an off-year election when control of the Senate hangs in the balance.

As The New York Times reports, “The goal is to keep premiums from rising in an election year.” That’s the real reason for the IRS ruling: politics.

In spite of what you may have read or heard from wavering politicians, there is no “fixing” or “reforming” Obamacare.

It’s is the worst of all possible worlds: socialized medicine combined with an industrial policy dictated by unelected and ill-informed bureaucrats. It removes individual choice. It dictates business planning.

And it patches over the holes with billions of tax dollars.

I want you to know that we at the League of American Voters consider Obamacare the No. 1 public enemy for America’s future. We will continue to fight it.

I strongly encourage you to join with us at the League. Your support is vital for us to continue this fight to stop Obamacare and his liberal agenda. Please take a moment and
Go Here Now to support us.

Michael Reagan is chairman of the League of American Voters.