Tax Experts Team Up with Covered California To Urge the Uninsured To Get Health Care Coverage

More Than 18,000 Californians Have Taken Advantage of Limited Special-Enrollment Opportunity; Consumers Are Encouraged to Sign Up by April 30

SACRAMENTO, Calif. — Covered California, state revenue agencies and tax preparers reminded uninsured consumers Tuesday that they still have time to sign up for health coverage to minimize tax penalties for tax year 2015.

The advice came as Californians continue to file their 2014 taxes in advance of the April 15 filing deadline, with some tax filers learning they are paying a penalty because they lacked health insurance in 2014.

Covered California has responded by creating a special-enrollment opportunity for consumers who were unaware of the tax penalty. The opportunity allows them to enroll in health coverage through April 30 and thereby minimize even steeper tax penalties taking effect for 2015.

Ordinarily, only consumers who experienced life events such as divorce, a new child or a loss of employer-provided health insurance would be able to sign up outside of open enrollment, which ended Feb. 15, 2015.

“The Affordable Care Act is clear: All who can afford health insurance must buy it, and the good news is that it is more affordable than ever before,” said Covered California Executive Director Peter V. Lee. “It’s important for Californians without health coverage to sign up now to avoid the increasing tax penalty they will face in 2015 if they remain uninsured.”

Lee said that more than 18,000 consumers have taken advantage of the special-enrollment opportunity since it began Feb. 23.  

California State Board of Equalization Chairman Jerome Horton, as well as representatives from the California Tax Education Council, H&R Block and Intuit, joined Lee in the reminder to consumers to enroll now or risk going without health coverage for all of 2015 and paying the full penalty unless they’re eligible for an exemption.

“I urge all uninsured Californians to sign up for health care through Covered California before the April 30th deadline. All California businesses should encourage their employees to do the same to avoid tax penalties and the high cost of not being insured,” said Horton.

Under the Affordable Care Act, consumers must verify on their tax return that they had health insurance throughout the tax year or face a penalty.

“Health care and taxes now go hand in hand,” Lee said. “Our state partners and tax preparation professionals will play a vital leadership role in communicating with consumers about health care issues. It’s a role in keeping with their mission to provide excellent services to individual clients, employers, and local and state governments.”

The tax penalty, or “shared responsibility payment,” will increase for tax year 2015. Those who can afford insurance but choose not to buy it face a penalty of $325 per adult in a household or 2 percent of their income, whichever is greater.

More details and examples of the tax penalty can be found here.

Officers at Intuit and H&R Block also underscored the importance of consumers knowing their options under the health law.

“Intuit is glad to partner with Covered California to raise awareness to help people avoid unnecessary tax penalties in 2015 and secure affordable health coverage for the year ahead,” said David Williams, chief tax officer for Intuit. “We continue to help Californians understand if they are eligible to enroll for health insurance during this special-enrollment period through TurboTax and the tax professionals that use Intuit software."

“H&R Block has updated its tax software systems, tax professional training and website content to reflect this special-enrollment eligibility opportunity for our impacted tax clients,” said Mark Ciaramitaro, H&R Block vice president of health care and tax services.

H&R Block, with more than 1,000 offices in California, also is reaching out to affected eligible clients through email.

The customer outreach for Intuit — whose products include do-it-yourself TurboTax and professional tax products Intuit Tax Online, Lacerte and ProSeries — include banner notifications about the special-enrollment period on the TurboTax Enrollment Guide and a blog and frequently asked questions about special-enrollment periods overall, with a highlight of California’s new special-enrollment period.

The California Tax Education Council (CTEC), a state-mandated nonprofit organization that registers close to 40,000 unlicensed tax preparers, also stands ready to help consumers in this new era of health care.

“It is complex. Hiring a tax professional might be the best option for many Californians. Just be careful. Most are honest professionals, but there have been reports of scammers playing up the penalty issue to their benefit,” said Margy Dunn, chair of CTEC. “People who need help finding a legal tax preparer can contact CTEC.”

Although the opportunity for consumers to enroll because of not being aware of the tax penalty ends April 30, enrollment is available year-round for Californians who have moved to another part of the state, lost their source of health coverage, added family members or experienced other significant life events. More information on the criteria for enrolling in Covered California and Medi-Cal year-round can be found at www.CoveredCA.com.

Consumers can sign up online, and more than 28,000 Certified Insurance Agents, Certified Enrollment Counselors and county eligibility workers stand ready to help them enroll in person, confidentially and at no cost for the enrollment services. Consumers also can call Covered California’s Service Center, at (800) 300-1506, where a representative will help them.

Lee reiterated that plans offered through Covered California provide good access to the care consumers need from physicians throughout California. And the vast majority of consumers enrolled received a subsidy to help them pay for coverage.

Approximately 800,000 California households received federal subsidies to make health care more affordable in 2014, with the estimated average amount received being more than $5,200 per household per year, or about $436 per month.

“The assistance provided through the Affordable Care Act helped bring health coverage within reach for more than a million people, and it changed lives across the state,” Lee said. “We want consumers to know there is broad access to physicians and hospitals across the plans offered by the exchange,” Lee said. “More than 61,000 unique physicians are available — or more than 75 percent of all licensed, active non-hospital physicians.”

About Covered California

Covered California is the state’s marketplace for the federal Patient Protection and Affordable Care Act. Covered California, in partnership with the California Department of Health Care Services, was charged with creating a new health insurance marketplace in which individuals and small businesses can get access to affordable health insurance plans. Covered California helps individuals determine whether they are eligible for premium assistance that is available on a sliding-scale basis to reduce insurance costs or whether they are eligible for low-cost or no-cost Medi-Cal. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget. Small businesses can purchase competitively priced health insurance plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.

Covered California is an independent part of the state government whose job is to make the new market work for California’s consumers. It is overseen by a five-member board appointed by the governor and the Legislature. For more information about Covered California, please visit www.CoveredCA.com.