Lawmakers dodge vote to impose tax penalty on those without health insurance

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A bill to require Californians to enroll in health insurance or pay a penalty was pulled from the Senate floor May 29. But expect a resurrection of the plan as part of the budget process.

It’s a move that allows legislators to avoid a politically dicey vote on what is essentially a tax on those who don’t purchase healthcare, but get the mandate anyway. You might call this aversion to voting for any new taxes the Newman Syndrome, in honor of former Sen. Josh Newman, who lost his seat in a recall election after he voted to support an increase in the state gas tax.

But the author of the mandate penalty bill, Democratic Sen. Richard Pan of Sacramento, also said the penalty is “a key part of the governor’s budget to fund subsidies” and would take effect sooner that way. The aim: replace a federal mandate that everyone to have health insurance or pay a federal tax penalty. Last year the requirement was canceled by the Trump administration as way to gut Obamacare.

Some states have already adopted their own replacement mandate, but California has been slow to do so. Concerns about imposing a fee on those who can’t afford insurance were eased by another bill by Pan, which would provide state-funded subsidies to middle-income families who haven’t been able to afford care. That bill did move out of the Senate this week, but its funding is contingent on the state adopting—and collected— a state mandate penalty.

If California does not adopt a mandate, experts say the state could see a significant rise in the number of uninsured people. Since 2013 the state’s uninsured rate has decreased from 20 percent to 7 percent. That means about 3.4 million people are uninsured, the majority of them are undocumented immigrants.

—Elizabeth Aguilera