The Internal Revenue Service (IRS) yesterday issued final regulations regarding penalties under the Affordable Care Act (ACA) for those who fail to maintain "minimum essential coverage."

Those who fail to maintain minimum essential health insurance coverage in 2014 will pay a fine of $95 or 1 percent of houshold income, whichever is larger. The fine increases to $325 and 2 percent in 2015, and to $695 and 2.5 percent in 2016. Taxpayers claiming children as dependents will also be liable for a "shared responsibility payment" if their dependents fail to obtain coverage.

Both the ACA mandate that individuals buy health insurance and the penalty structure for those who do not go into effect on Jan. 1, 2014.

Exempt from the mandate are those who have lost insurance temporarily because they are between jobs, those who oppose health insurance on religious grounds, and those who belong to Native American tribes.

The final regulations adopt a "one-day rule" for determiniming whether an individual has "minimum essential coverage" for the month, to wit:

The proposed regulations provide that, for any calendar month, an individual has minimum essential coverage if the individual is enrolled in and entitled to receive benefits under a program or plan that is minimum essential coverage for at least one day during the month.

The IRS, however, in its published regulations retained the right to review the "one-day rule" if it turns out that individuals are able to game the system by purchasing health insurance for one day for consecutive months.

Moves are underway in Congress to delay the individual mandate for one calendar year, but few expect this effort to succeed given the Democratic dominance in the Senate. On July 2, the administration indeed did delay for a year the business mandate to provide health insurance to employees or pay a penalty.