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76 Ohio St. L.J. Furthermore 1 (2015)

handle is hein.journals/furth76 and id is 1 raw text is: Gambling for Health Care JACK L. MILLMAN* TABLE OF CONTENTS I. INTRODUCTION I..........1 II. BACKGROUND TO THE PROBLEM...................................2 III. ONE ABSURD SOLUTION TO AVOID THE GAP ...................... 3 IV. PRACTICAL CONSIDERATIONS AND POLICY CONCERNS ... ............ 5 V. CONCLUSION.................................................... 8 I. INTRODUCTION Gamble. Win a little. Maybe lose a little more. Obtain free health insurance? It is an absurd tax planning technique that should actually work-at least in theory. And, it perfectly illustrates the nonsensical system now in place in the states that have refused to expand Medicaid coverage as envisioned when the Affordable Care Act was enacted. In those states, the very poor tend to be already covered by Medicaid, while those with higher incomes qualify for the exchange-based credits. A middle group-those too poor to be covered by the Affordable Care Act but not impoverished enough to qualify for their state's Medicaid coverage-is left out in the cold. Oddly, gambling may provide this group a way to obtain subsidized health care coverage. In this Paper I argue that certain low income taxpayers could prepare to gamble in the upcoming year in order to inflate their estimated Adjusted Gross Income (AGI) and qualify for thousands in health insurance related tax credits-thus making their insurance affordable. Tax planning strategies usually do not involve increasing one's AGI via gambling, but states' refusal to expand Medicaid, combined with the Affordable Care Act, has created a situation where millions of adults' best opportunity to obtain health insurance may come through gambling. I do not advocate that most eligible taxpayers should actually attempt this strategy for reasons detailed below, but instead discuss it to illustrate the current problems with the law. One possible objection to this strategy is the downside economic risk these already poor Americans would have to bear in order to get the health insurance subsidy. Another possible objection concerns the risk that the IRS may disallow attempts to avoid the economic downside anyway, resulting in the poor getting stuck with losses twice. Others may have moral objections. They might argue that it violates the spirit of the Affordable Care Act. I would respond that * Staff Editor, New York University Law Review; J.D., New York University School of Law, expected 2016. I would like to thank Professor Catherine Sharkey for being my Furman Program mentor, Professor David Kamin for providing feedback and helping develop the idea for this article, and Kevin Benish, Kyle Lachmund, Joanna Langille, and Susan Navarro Smelcer for their helpful comments and edits on earlier drafts.

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