Obamacare’s broken religious exemption

We well know that the Obama administration will not grant a religious exemption for its contraception/abortion mandate, but, for some, it actually does provide an exemption to the entire mandate (124 Stat. 246, here):

[Applicable individual] shall not include any individual for any month if such individual has in effect an exemption under section 1311(d)(4)(H) of the Patient Protection and Affordable Care Act which certifies that such individual is a member of a recognized religious sect or division thereof described in section 1402(g)(1) and an adherent of established tenets or teachings of such sect or division as described in such section.

Section 1402(g)(1) is a provision of the tax code that governs groups exempt from paying Social Security tax. It applies, for example, to the Amish. Some have suggested that the exemption would apply to Muslims; Snopes says that’s not clear (although, for some reason, they rate the claim “false” rather than “undetermined”).

But I want to point out that, in any case, the exemption is drafted incorrectly. (Maybe it’s silly to point out flaws in the law when the entire thing is an atrocity, but never mind that.)

The Social Security provision prevents people claiming benefits after obtaining an exemption from paying the tax (1402(g)(1), here):

Such exemption may be granted only if the application contains or is accompanied by . . .

(B) his waiver of all benefits and other payments under titles II and XVIII of the Social Security Act on the basis of his wages and self-employment income as well as all such benefits and other payments to him on the basis of the wages and self-employment income of any other person . . .

But as far as I can determine, there is no such provision in Obamacare. The guaranteed availability provision applies to everyone, not only to “applicable individuals” (124 Stat. 156):

Subject to subsections (b) through (e), each health insurance issuer that offers health insurance coverage in the individual or group market in a State must accept every employer and individual in the State that applies for such coverage.

Thus, to claim a religious exemption to the mandate, one must forego claiming Social Security benefits, but one can still exploit guaranteed issue.

This is wrong in both directions. On the one side, it allows exactly the sort of free rider the mandate was supposed to prevent: a person belonging to an exempt sect can remain outside the mandate until he or she becomes sick, and then obtain insurance. On the other side, persons with a religious objection to health insurance cannot receive the exemption unless they also waive the Social Security benefits toward which they have been paying their entire lives.

This is a good example of why it’s a good idea to read a bill before you pass it.

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