Connecticut considers $9,600 tax for people without health insurance

Republicans may have gutted the Affordable Care Act (ACA) individual mandate in the 2017 Tax Act, but now some states, including Connecticut, are considering implementing a penalty tax on high-income people who choose to not purchase health insurance.

At the suggestion of a Yale University economist, Connecticut is weighing a fine of up to 9.6% for high-income individuals without health insurance. For a person who earns $100,000, that’s a fine of $9,600.

“It’s really twisting people’s arms to get them to do what they want,” FOX Business’ Gerri Willis said during an interview on Friday.

Under ObamaCare, individuals without insurance had to pay a 2.5% fine. In 2017, 60,000 individuals and families in Connecticut paid the federal tax penalty of $695, or 2.5% of taxable income. The repeal of the mandate will go into effect in 2019, although large portions of the healthcare law will remain intact.

The logic behind the mandate is that rational actors will choose to get coverage, instead of paying $9,600 and receiving nothing. Another option for Connecticut residents is to put that money in a health-savings account.

Other states that are considering establishing their own individual mandate rule include Maryland, California, Hawaii, Minnesota, New Jersey, Rhode Island, Vermont and Washington, as well as the District of Columbia, according to a report by the Wall Street Journal.