Tax Preparers Help Boost Obamacare Numbers

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The Obama administration has found a new ally in its quest to help uninsured Americans buy individual health insurance under the Affordable Care Act, also known as Obamacare.

Tax return customers of H&R Block and Jackson Hewitt Tax Service are also getting free help applying for health insurance.

Says MarketWatch:

After taxpayers are done with their returns, H&R Block helps them estimate what their premiums would cost if they were to qualify for a premium subsidy tax credit to help lower insurance costs and to calculate how big a penalty they will have to pay if they lack insurance coverage. People who want to shop for insurance are connected with agents from GoHealth LLC, an online insurance broker who can help them compare plans and apply for insurance on HealthCare.gov. …

People who get their taxes done with Jackson Hewitt Tax Service can get help filling out an application for Medicaid and are given the option of calling a broker at GetInsured, a private health insurance exchange, for help filling out an application on HealthCare.gov.

Meanwhile, TurboTax has provided an online tool to walk people through a similar process, it explains in this blog post.

(Remember: Only those who buy individual health insurance through HealthCare.gov or one of the state online marketplaces are eligible for the premium subsidy, in the form of a tax credit.)

This new service from the tax preparers appears to be a win-win for both the customers and the tax prep companies.

  • You’ll find out if you’re eligible for the subsidy and how big it is. (You can also do that at HealthCare.gov or your state’s online marketplace, if it has one.)
  • You’ll find out how much of a penalty you’ll pay if you don’t have health insurance this year. Just about everyone is required to have health insurance in 2014 or pay a penalty — the larger of $95 or 1 percent of your annual adjusted gross income. The penalty will be deducted from next year’s tax refund.
  • The tax preparation firms stand to make a commission when people buy health plans.

Says CNBC:

“… it worked out for me,” said [Leah Beth] Brummett, a student and website sales employee who after a decade of going without health insurance signed up at Jackson Hewitt’s suggestion with GetInsured that day. She enrolled in an Obamacare plan with a sticker price of $280 per month — but after government subsidies, she’ll pay about $28 per month for coverage.

Bloomberg says the Urban Institute in Washington, D.C., found that “three-quarters of people who qualify for subsidies under Obamacare file federal income tax returns — and most use one of the big tax prep firms. That makes them an ideal target audience.”

Neither H&R Block nor Jackson Hewitt would disclose how many taxpayers they’ve helped to buy health insurance. But Stan Dorn, a senior fellow at the Urban Institute who has studied the issue, told Bloomberg, “My guess is certainly tens of thousands, maybe hundreds of thousands … .” 

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Comments & discussion

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  • Joseph Freitas

    So… They turned tax preparers into commissioned insurance sales people that never actually have to get licensed to produce insurance business. Yea… Do I even need to specify the pitfalls?

  • Don1357

    Obamacare is here and the deadlines for people to become a part of a required plan without penalty is coming swiftly upon us. While die-hard politicians are chattering away (the burning Rome syndrome) common folks are getting deeper into potential financial and legal problems. Those same politicians won’t be there to help them out of it, so until all of this mess gets straightened out, it seems prudent to me that someone help people get coverage they need, to avoid the pitfalls as soon as possible. Later, when their options are plainer, they can continue or withdraw and take the consequences, but they will at least know better what to expect, then, and won’t be surprised by unforeseen pitfalls.

  • Y2KJillian

    We’re using Cobra for the rest of this year, and are actually looking forward to using the ACA for the years after that before we’re old enough for Medicare. Tax preparers would be ideal to help people get started with this process, as you really do have to know exactly how much you’re making each year to find out how much you’ll pay for the ACA plans. Even a few dollars off can make a financial difference…Makes logical sense that the tax preparers could do this. Do they really need to be –what, certified? Licensed? Doesn’t the article say they just steer people to the exchanges where they can speak to the real sellers by phone?