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Tuesday, February 19, 2013

Weights of money and health insThis article in the LA Times describes how H&R Block is already helping its patrons identify how much of a tax credit they may be eligible to receive under health care reform.  Most of the patrons who are quoted in the article are surprised to learn just how little the insurance will cost them.

H&R Block seems to think that 2012 income is somehow going to be key to determining if someone is eligible for the credit.  While the IRS may very well look at that, it’s worth pointing out that the actual eligibility for the credit will be finally determined after-the-fact based on the individual’s income for the year in which the credit is received.  Therefore, while 2012 income is informative, it is far from dispositive.

Furthermore, employers should be aware that these information efforts are taking place.  Employees may already start contacting HR departments to ask about the information they are receiving and asking how the employer’s plan compares.  One concern with this is that, to the extent an employer has many low-paid workers who are healthy, they may opt to go to the exchange rather than take the employer’s plan.  If the employer desires to keep those individuals enrolled in its plan to help with its experience rating, the employer may need to be proactive in advertising the benefits of its offerings to those employees.

What do you think?  Is it a good idea for H&R Block to provide this type of information?

Related Link

Washington Post – How H&R Block plans to capitalize on Obamacare

Disclaimer/IRS Circular 230 Notice

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