Implementing the Affordable Care Act: Education, Enrollment and the taxpayer

February 28, 2013 : Kathy Pickering

The Patient Protection and Affordable Care Act is kicking into high gear in 2013 with significant implications for Americans, their health care – and their annual tax return. The Tax Institute at H&R Block this month has launched a series of conversations aimed at helping policymakers, state administrators, businesses and taxpayers understand their roles and responsibilities going forward because the new law created some of the biggest tax law changes in decades.

Kicking off these conversations in Washington, D.C. with our partner Bloomberg Government, we had a robust conversation about what the consumer knows now and needs to know down the road about the Affordable Care Act, expectations that the landmark health care law is indeed still a work in progress and how consumers will navigate the new health exchanges that are being established.

The Tax Institute at H&R Block conducted a survey last fall and what’s remarkable is that we discovered that three out of four taxpayers do not know what will be necessary to be eligible for health insurance under the new law – and that it can start with the tax return that they will file this year. Consumers, taxpayers, businesses, and the uninsured all face unique and unprecedented challenges to understand and benefit from the law.

Not surprisingly, most people are familiar with one of the law’s most prominent features: the mandate for having health insurance. However, a significant minority, 44 percent of respondents age 18-34 were not aware that they may face a tax penalty if they fail to obtain insurance coverage. What many taxpayers do not also realize is that they may be eligible for tax credits, or subsidies to help purchase that coverage.

While there are groups, like Enroll America, that are focused on enrollment, there’s also a real need to educate taxpayers on the implications to the tax return, and that’s where H&R Block is uniquely positioned to help. There is no time to waste, the 2012 tax return deadline is less than two months away and the exchanges open for business on Oct. 1. This conversation must expand and quickly.

As former Senator Blanche Lincoln noted during our conversation: “I just think it’s really critical that we all know that we have a tremendous amount to gain if we get it right as we come through these changes, and that it’s going to take every one of us to deploy it – to deploy that information.”

I found one idea for outreach particularly intriguing for engaging consumers about the rapidly coming changes in health care, suggested by Paul Keckley, executive director of the Deloitte Center for Health Solutions. He highlighted the benefits of using mobile applications to engage consumers about the coming changes in health care. He noted that moments of opportunity to enroll the uninsured, or begin the process, could be accomplished through mobile applications when they get care from a clinic or emergency room. “We believe mobile apps touch a substantial number in this population,” Keckley said.

At H&R Block, we are also doing our part with our team of tax professionals conducting personal reviews on a daily basis for clients, including showing them how they may qualify for assistance to pay for health insurance and noting how their tax return this year could serve as the baseline for that subsidy.

Additionally, in the coming weeks, our team from The Tax Institute at H&R Block will be hitting the road for Florida, California and Illinois. This is part of our effort to draw attention to these issues and engage policymakers, state administrators, businesses and taxpayers on what they need to know, highlight how the health care law will affect them and help make this transition as seamless as possible.

We look forward to seeing you on the road – and let us know how we can help!

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Kathy Pickering

Chief Tax Officer

Kathy is the chief tax officer at H&R Block. With more than a decade of experience in tax operations and 25 years in information technology, Pickering is responsible for the strategic direction and management for a team of the nation's top experts on tax issues. Prior to joining H&R Block, Pickering worked with Sprint PCS, Olsten Health Services and various consulting firms where she focused on implementing accounting and financial systems, and leading Enterprise Resource Planning (ERP) software implementations, such as JD Edwards and PeopleSoft software.

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