After months of saying there would be no extension to this year’s open enrollment, guess what? Obamacare was extended.
But only for a select group of people.
People who received tax credits under Obamacare to help them afford health insurance in 2014 were required to file a 2014 tax return in order to prove they received the right amount of subsidy credit on their monthly insurance costs. If people failed to file a tax return, they became ineligible for further tax credits starting in 2016.
So, those who did not file a tax return in 2014 are now responsible for paying the full cost of insurance beginning this year. For many, that makes health insurance unaffordable. But now the government is going to give them a second chance to file their taxes.
If this group of individuals files their 2014 taxes before March 31, 2016, they are still eligible to buy health insurance in the special open enrollment period. Without the tax credit, many people would find coverage unaffordable, and would be likely to forgo coverage altogether.
It is unclear exactly how many people are eligible for the new special enrollment period. The Centers for Medicare and Medicaid Services (CMS) said it “believes there are only a relatively small number of consumers who will qualify.” CMS reported last month that at least 43,000 had lost their credits because they failed to file a 2014 tax return.
Yet the Department for Health and Human Services released data in early January revealing 316,000 households did not file taxes in 2014. While some households might not have made enough taxable income to file, tax filing is required for anyone who receives a tax credit for health insurance. An additional 147,000 households filed an extension to file their 2014 taxes, but never followed through. The number of qualifying households may be bigger than analysts anticipate.
There is also a second group of people who are eligible for the special open enrollment period. This group had Obamacare coverage in 2014, dropped it in 2015, and tried to sign up again in 2016. They were blocked from receiving a tax credit on their healthcare plan because they had not filed their 2014 return.
It is unclear how big this second group is, but Tim Jost, a professor at Washington and Lee University and an expert on the health law, said he expects the total number of people eligible for the new special enrollment period to be “well under” 100,000.
What should a consumer do who is eligible for this new extension?
Check out sites like HealthCare.com. You will be able to browse plans that are eligible for subsidies and those without. Once there, you can choose to enroll directly or connect with a licensed agent.
But only if you pay your taxes. And can prove you did.