Why not use tax preparers as a portal to health exchanges?
As issues with the HealthCare.gov website continue to arise, people need a better way to buy insurance. Health insurance purchases should be part of filing tax returns, Gleckman explains.
What if we bought individual health insurance through our tax preparers? At first, the idea seems bizarre, but give me a minute to explain.Skip to next paragraph
Howard Gleckman is a resident fellow at The Urban-Brookings Tax Policy Center, the author of Caring for Our Parents, and former senior correspondent in the Washington bureau of Business Week. (http://taxvox.taxpolicycenter.org)
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Given the well-known problems of HealthCare.gov and many of the state health exchanges, people seeking insurance coverage need a better way to buy. And commercial alternatives to government sites seem an obvious portal to Affordable Care Act coverage.
You can buy directly through insurance company websites, but the Obama Administration worries that would make it impossible to compare policies offered by different carriers in the way you could on a well-functioning exchange. For instance, if I go the Blue Cross site, I’m not likely to learn much about Kaiser Permanente’s offerings. On the other hand, commercial online health insurance marketplaces allow for comparison shopping, but raise issues of privacy (and perhaps even fraud from fake sites).
Or, you could make your purchase of health insurance a relatively seamless part of filing your tax return.
It actually makes a lot of sense. After all, the Affordable Care Act subsidies are tax credits and the information you need to figure out your subsidy amount is based on the income tax you pay. The penalty you’d owe for not buying insurance is a federal tax. Tax preparers already have—and are legally required to protect—nearly all the personal information they’d need to help figure the subsidy.
Brian Haile, Jackson Hewitt’s senior vp for health policy, predicts more people could end up buying through their connection with tax preparers than any other portal. “It’s a no-brainer,” he told me, “The Affordable Care Act is a series of amendments to the Internal Revenue Code and we help customers with their taxes. We can make this far more accessible for folks.”
I’m hardly the first person to think of this. My Urban Institute colleague Stan Dorn has been exploring this idea since 2011—long before the HealthCare.gov site crashed. And now tax prep outfits are taking steps in this direction.