CMS, Treasury Dept. announce special election period for ACA, tax guidance

For our agents contracted to sell individual plans available on the Health Insurance Marketplace, take note of these two important announcements as you advise your clients on how their plan purchases will affect their filings this year and next.

Shortly after the 2015 ACA open enrollment officially closed on February 15, CMS announced a special enrollment period for individuals and families who were unsure of the tax implications for not having coverage last year. Soon after, the Treasury Department announced it will not require individuals who have already filed their 2014 tax returns this year to resubmit documents after the Department of Health and Human Services (HHS), which oversees the Marketplace, reported February 20 that it had sent erroneous information to 800,000 individuals who purchased plans in the federal exchange’s first year of operation.

According a press release from CMS, the special enrollment period will run from March 15 to April 30. In the press release, CMS states consumers may be required to pay a fee when they file their 2015 returns next year if they do not purchase a plan during this time.

CMS also lists eligibility criteria for the special enrollment period for consumers in the 37 states that have a federally facilitated Marketplace. Here’s who is eligible:

  • Consumers not currently enrolled in coverage through the federally facilitated Marketplace for 2015.
  • Consumers who can attest that when they filed their 2014 tax return, they paid the fee for not having health coverage in 2014.
  • Consumers who can attest they first became aware of or understood the implications of the Shared Responsibility Payment in connection to preparing their 2014 returns after the 2015 open enrollment ended.

The Shared Responsibility Payment refers to the fee individuals who did not have coverage in 2014 must pay when they file their returns this year; 2015 is the first year this part of the Affordable Care Act goes into effect. Agents may direct their clients to a new health coverage tax exemption tool on the Marketplace website to determine eligibility for many possible exemptions from the Shared Responsibility payment, CMS states in the press release.

Following the announcement that the government sent incorrect tax reports to 800,000 individuals, the Treasury Department announced February 25 that those who had already filed their 2014 returns will not have to resubmit corrected information. The Associated Press (AP) reports “The decision amounts to a reprieve from paperwork headaches for an estimated 50,000 early filers” of the 800,000 who were affected by the miscommunication.

According to AP, those who have yet to file their tax returns are encouraged to wait until they receive correct information from HHS.

The healthcare.gov blog published an explanation of the error February 20.