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Life Health > Health Insurance > Your Practice

The single word that could make or break Obamacare

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Obamacare—is it a penalty or a tax? Both basically have the same meaning in this case, but President Obama said the decision to call the mandate a penalty was purposeful. Why? Research in behavioral analytics found that shame is better at achieving compliance than a fee. A penalty gives the impression that something must be done and that failing to do so is wrong. The purpose of the mandate is to get Americans to buy health insurance. Referring to the mandate as a tax would leave people less inclined to buy insurance.