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CA Legislature Approves Tax On People Without Health Insurance

The idea of a health insurance mandate like the one that was part of the Affordable Care Act under President Obama is about to make a comeback in California after Republicans in Congress eliminated the federal penalty as part of an overhaul of the federal tax code which took affect in January of this year.

The state Legislature has passed a bill which requires Californians to buy health insurance or face a fine if they refuse to do so, and the measure is now awaiting Governor Gavin Newsom's signature before becoming law.

The state Assembly and Senate approved the tax on Monday. The revenue from penalties will reportedly be used to pay for health insurance subsidies meant to encourage more people to get health insurance, and to cover the cost of providing health care to illegal immigrants. Newsom proposed a similar plan back in January.

Republican Assemblyman James Gallagher Yuba City said he is opposed to the idea penalties.

"The idea that we should mandate under threat of a fine or penalty that you purchase health insurance, or any product/service for that matter, runs counter to our American values and any concept of personal freedom. And the idea that it is 'necessary' to bring down the costs of healthcare and premiums is just laughable at this point."

Gallagher claims the penalty will be $695 per adult plus $347.50 per child, up to a maximum of $2,085 or 2.5 percent of a household's modified adjusted gross income over their tax filing threshold, whichever is higher. But the penalty won't be more than the average cost of a bronze plan on the California health insurance exchange.

If the bill becomes becomes law, California would be the fourth state to require health insurance.


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