My friend Grayson Levy has an interesting post at the Future of Capitalism asking whether proposed health-insurance mandates, and therefore the penalties for not showing proof of acceptable insurance, would apply to expatriates. Grayson, who lives in Israel, has good reason to be concerned. He has looked extensively into the issue and has seen no indication thus far that expats would be exempted from the requirement.
An exemption would seem to be the way to go on this, but even an exemption does not solve the problem. Providing documentation for eligibility would be somewhat cumbersome, and raises the tricky question of whether the U.S. government would accept insurance from some countries and not from others. An exemption could also serve as as a possible loophole for non-expats trying to get out of the mandate. I wonder if the IRS has enough staff to handle this one.