MONTPELIER — State officials are warning Vermonters who obtained health insurance through Vermont Health Connect to be on the lookout for important tax documents that should arrive in the mail by next week.
More than 25,000 1095-A forms have been mailed to Vermonters. The form has the financial information customers provided when signing up for health insurance coverage on the state’s online marketplace.
But Chief of Health Care Reform Lawrence Miller said some customers may experience problems because not all change of circumstance requests have been processed by the state. Another batch of changes is expected to be processed by Feb. 20, so some customers may received a corrected 1095-A.
“There will be some that get corrections but that doesn’t necessarily slow anybody down in completing their taxes,” Miller told reporters Thursday. “People may find that they’ve got a discrepancy … and need some help.”
Customers could also be required to pay back subsidies if their incomes changed during 2014, or could receive payments from the federal government, depending on whether their income went up or down.
Miller said 36 percent of the 37,239 Vermonters on the exchange had no federal subsidy. Ten percent of customers had only a federal subsidy, and 54 percent received a federal subsidy as well as additional premium assistance from the state.
Everyone who receives a 1095-A form in the mail will need to fill out IRS Form 8962. The 1095-A form includes the financial information needed to do so. Even those that didn’t receive tax credits as part of their coverage must complete the form if they purchased a bronze, silver, gold or platinum plan on the exchange, according to officials.
Customers with questions will see a “substantially faster” connection to the VHC call center than the IRS. Miller said the IRS “received inadequate funding to fully staff its’ call center” and wait times of at least 20 minutes are expected.
“That will be a bigger challenge for folks if they need to call the IRS help center,” he said.
Tax preparation software and accountants and tax preparers should be prepared to help complete required tax forms related to health care.
“Those people have been prepared and folks should expect a relatively smooth experience,” Miller said. “My hunch is, while this seems very new and very complicated, for the majority of people as they go through their taxes, it will be smooth.”
State officials said whether or not customers will owe money back for subsidies received or receive subsidies after-the-fact depends on how close their actual income was compared to what they estimated. That information is unclear to the state until forms are completed and filed.
“No way of knowing. This is the first year its’ been done. It’s hard to know what happens to people’s income over the course of a year. You would tend to assume, that if people based their financial information on their income from last year, most people would have seen a slight increase in their income,” Miller said. “It depends on what they estimated.”