STUMP » Articles » Obamacare Watch: Tax Pain Is Not Enough? » 21 March 2015, 17:46

Two items, with very little commentary.

LifeHealthPro has come up with their own Obamacare Tax Watch:

Just how miserable are Patient Protection and Affordable Care Act (PPACA) tax problems making consumers?

We tried to get a rough-and-ready way to answer that question by developing a new consumer tax pain tool, a Form 1095-A Pain Index.

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We tried to create a ruler for measuring how much 1095-A pain consumers are feeling, when compared with the usual Form 1040 pain, by looking at consumers’ posts on three tax-related message boards: Intuit’s TurboTax message board, H&R Block’s The Community message board, and the message board for The Tax Book.

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When we looked at the ratio of 1095-A and 1095-related message board posts to posts including the term 1040, we found that, over the past year, board users started 1,044 discussions about 1095 forms, compared with 12,638 discussions about 1040 forms.

During the past year, message users have been about 8.3 percent as likely to start a thread about 1095-family forms as about the 1040.

In the past week, that percentage has increased to 12 percent.

The PPACA tax pain percentage is bigger and has increased more on the H&R Block board.

On the TurboTax board, the PPACA tax pain percentage has increased to 11 percent for the past week, from 7.7 percent for the past year.

On TheTaxBook.com board, the pain percentage fell to 10 percent for the past week, from 16 percent for the year.

On the H&R Block board, the pain percentage rose to 54 percent for the past week, from 15 percent for the year.

LifeHealthPro is an insurance industry media outfit, which I use for my day job quite a lot.

The WSJ has its own story — the tax pain/penalty is not so much that non-enrollees are signing up for Obamacare.

Major tax-preparation firms say many customers are paying the penalty and not getting health insurance. It is still early, since the special enrollment period launched Sunday, but research also suggests that many people who lack health insurance will pay the penalty and not get covered this year.

Only 12% of uninsured people would buy policies if informed of the penalty, according to a survey of 3,000 adults polled through Feb. 24 by McKinsey & Co.’s Center for U.S. Health System Reform.

At H&R Block Inc., “our analysis indicates that a significant percentage of taxpayers whose household members were not covered for at least a portion of 2014 are opting” to pay the penalty, said Mark Ciaramitaro, a vice president of health-care enrollment services at the tax-preparation firm.

I find that interesting. Of course, the 2014 tax year penalty is the just a phase-in — it’s supposed to increase over the years.

Maybe people will change their minds over time, once the tax/penalty/fee/whatever tops out at 2.5% of their modified adjusted gross income in 2016 for the 2016 tax/penalty/fee/whatever. Or maybe the health insurance premiums (even with subsidies) are higher than that tax/penalty/fee/whatever even if you include out-of-pocket health expenditures.

Huh, fancy that. Rushed-through legislation may not be the best way to make policy.