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Health Law Open Enrollment Should Coincide with Tax Filing, Group Says

By John Reichard, CQ HealthBeat Editor

April 1, 2014 -- The open enrollment period to sign up for coverage under the health law should be rescheduled so that people who opt out and face a tax penalty will better understand the consequences, an advocacy group urged last week.

"Fully aligning the open enrollment period with the tax filing period would significantly increase enrollment," Families USA said in a set of 10 recommendations aimed at boosting future enrollment totals.

The change "would enable professional tax preparers to play a much larger role in enrollment efforts, and it would help people have a better understanding of the tax consequences they would experience if they don't enroll in health insurance," according to the recommendations.

Open enrollment for 2015 runs from Nov. 15 through Feb. 15. Many of the people who remain uninsured this year aren't aware they face a tax penalty when they file taxes next year, the group noted.

When they find out – presumably after Feb. 15 in many cases – it will be too late for them to avoid having to pay another penalty in 2016 for failing to have coverage in 2015.

Making the change would allow the affected group to avoid a second penalty, Families USA said. "If the administration creates a special enrollment period for the tax filing period between Feb. 15 and April 15, 2015, this time could be used to educate uninsured consumers and increase enrollment," the group said.

It may be too late to do more, but Families USA also encouraged the Department of Health and Human Services (HHS) to also consider starting enrollment after Nov. 15 and ending at or around April 15.

Failure to comply with the individual mandate in the health law (PL 111-148, PL 111-152) this year could result in penalties of up to $285 per family or 1 percent of taxable income. In 2015, it would be $975 per family, or 2 percent of taxable income.

In other recommendations, Families USA, which supports the health law, said HHS and the states should allocate more administrative funds to increase the number of navigators and others who help people get enrolled.

"Three out of four consumers would like in-person help with applying for health insurance," the group said. It noted an Urban Institute study that found almost half of the uninsured who did not plan to buy insurance in an exchange but who were aware of the option to do so would be more likely to do so if they had in-person help.

Also, a "substantial" public education campaign is needed to make people aware they can get financial help to reduce their cost of health insurance, the group said. "Survey research shows that about seven in 10 uninsured adults do not know about this financial assistance," the group said, adding the problem is especially acute in communities of color.

HHS also should allow states to indefinitely extend streamlined Medicaid enrollment by using information from other public programs they are enrolled in to help them apply for coverage, Families USA urged. This authority is now set to expire in 2015.

Also, applications should be provided that can be completed in languages other than English and Spanish. And HHS should assure that Medicaid eligibility assessments "are transferred to state agencies within 24 hours, and state agencies should process those applications quickly."

Other obstacles should be removed that keep people from completing applications. For example, employees who are offered coverage by their employer that is considered too skimpy or costly under the health law can get subsidized coverage from exchanges instead.

But the employer must complete an "Employer Coverage Tool" document in order for employees to qualify. This document should automatically be provided to the employee when they receive an offer of coverage. "This step has prevented many people from completing the enrollment application," Families USA said.

In other recommendations, the group said health plans should be banned from imposing premium surcharges for tobacco users, HHS should ensure that exchanges offer low-deductible silver plans and the agency should exclude from the marketplaces plans that charge excessive premiums.

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