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More Resources on Access Initiatives in the States
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February 14: Expanding the Pool: Individual Mandates, Tax Benefits and Other Incentives
Current Proposals
Individual Mandates
- California Governor Schwarzenegger’s proposal includes an individual mandate. Penalties include possible garnishing of wages. At a minimum, California residents would be required to purchase a $5,000 deductible plan – with out-of-pocket expenses capped at $7,500 for individuals and at $10,000 for families.
More information on this proposal is available at
California Senate President Pro Tem Don Perata has sponsored SB 48, which would create the Health Insurance Connector, a health insurance purchasing pool. This
legislation establishes an employer mandate; businesses also have the option of providing coverage through the Connector for a fee. The bill also would require those
who are employed and those who are self-employed to maintain a minimum level of coverage for themselves and their dependents.
- Illinois The Adequate Health Care Task Force Hybrid Model plan has an individual mandate and an income tax penalty for noncompliance. This plan also requires employers to provide coverage to their employees and penalizes employers for noncompliance.
Further details of this plan are available at
- Iowa State Senator Jack Hatch’s proposal includes an individual mandate but there is no penalty for noncompliance.
Further information about this plan is available at
- New Jersey State Senator Joseph Vitale’s plan includes an individual mandate. Residents would be required to prove that they have coverage on their income tax returns. Under this proposal, the state also would offer a state-sponsored plan; low-income residents’ premiums would be based on a sliding scale of income.
Further information about this plan is available at
- New Mexico One of the Health Coverage for New Mexicans Committee’s proposals includes an individual mandate. No penalties. This proposal is a market-based approach that provides vouchers to individuals to purchase coverage.
Further details of the Committee’s work is available online at
- Pennsylvania Governor Edward G. Rendall’s proposal includes an individual mandate for individuals above 300% FPL as well as for full-time students at 4-year colleges and universities (as a condition of their admission to the school). The plan also calls for a study to examine the feasibility of an individual mandate for all of the state’s residents.
More information on this proposal is available at
- Washington State Representative Eileen Cody’s proposal, HB 1569, has an individual mandate. No penalties.
- The Blueprint for Coverage in New York is a proposal of the United Hospital Fund and The Commonwealth Fund to bring universal coverage to New York. This plan would expand eligibility for the Family Health Plus and provide subsidies for moderate income residents to buy into the program. This proposal would create a new purchasing entity for individuals to obtain health insurance at group rates and would establish an individual mandate.
More information on the Blueprint proposal is available at
- Oregon Health Policy Commission proposes building on improvements in existing system structures, programs and efforts. Encourages use of value-based purchasing to improve quality and cost effectiveness. Includes requirement for individuals to have health coverage, subsidies for low-income individuals and expansion of Medicaid.
Tax Incentives
- Federal President Bush proposed in his State of the Union address to allow individuals to get a standard tax deduction of $7,500 for their coverage; families would get a standard tax deduction of $15,000 for their policies. Those who do not itemize on their tax returns would still be able to take advantage of this tax deduction. This plan would also cap the amount of pre-tax wages that could be spent on health coverage. Individuals and families with more expensive plans would have to make up the difference using income after taxes.
Further details on this plan are available at
- Minnesota Governor Tim Pawlenty's plan enhances tax breaks for individuals and employers. In order to withhold money on a pre-tax basis for employee health insurance, all employers with more than 10 employees would be required to establish a “Section 125 plan” – based on Section 125 of the Internal Revenue Code. However, employers will not be required to offer or contribute to health insurance coverage for their employees. The initial set-up cost of a 125 plan is estimated at about $300 and employers would realize some savings by not paying payroll taxes (Social Security, Medicare and unemployment taxes) on the amounts that employees pay for health insurance premiums through the Minnesota Health Insurance Exchange, which would connect employers, employees, MinnesotaCare recipients and individuals to more affordable coverage options. Governor Pawlenty’s Healthy Connections initiative will require legislative approval and will be included in his budget proposal later this month. The program will cost $31 million for the next two-year budget cycle and $88 million when fully implemented in the next biennium.
More information on this proposal is available at
- Oregon SB 329 requires certain persons to participate in program. Requires uninsured individual with income greater than 250 percent of federal poverty guidelines to pay premiums. Denies a state income tax exemption credit to individuals who fail to pay premiums.
Additional Resources
Cost of Individual Coverage
Individual Mandates
Tax Credits
Overviews
NCSL Resources
Both these pages have a number of links to other NCSL resources on health care access.
Other
 Access 2007 Series Webcast
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