While most people haven't given much thought to their upcoming 2015 tax year filing, state Medicaid and Children's Health Insurance Program (CHIP) agencies have been thinking about them a lot -- specifically the creation, mailing and outreach of the new IRS 1095-B health insurance tax form. Under the Affordable Care Act (ACA), they are responsible for sending the 1095-B tax form to all enrollees who received Medicaid or CHIP insurance coverage in 2015.
The ACA requires Americans to have a basic level of health insurance -- also referred to as minimum essential coverage (MEC). Consumers need to receive this completed 1095-B tax form in January 2016 so they can prove that they and their family members received MEC during each month of the year in 2015 when filing their taxes.
With a New Tax Form Comes New Questions
Since this will be a new tax form for consumers, it can be expected that many will have questions and be confused as to why they received it. The IRS has already provided some information to help explain what the form is and who needs to file it, but state Medicaid and CHIP agencies need to be prepared for an influx of additional questions about what the 1095-B tax form is, why consumers need it, what the information provided means to them, and what to do if the information isn't correct.
Compounding the potential confusion from receiving this form is that, due to variations in health insurance coverage among households, it is possible that a single household could receive three different 1095 health insurance tax forms in January. Besides the 1095-B tax form for government-sponsored coverage and other forms of MEC, they could also receive the 1095-A tax form which is sent by all state-based marketplaces (SBM) and the Federally-Facilitated Marketplace (FFM), also known as Healthcare.gov, to individuals who enrolled in a qualified health plan (QHP). Additionally, they could also receive the 1095-C tax form which is sent out by applicable large employers to all employees with MEC to confirm each month of health insurance coverage.
Preparing for Consumer Inquiries
The rollout of the ACA has generated many questions from consumers and led to high volumes of inbound inquiries to both SBM and FFM contact centers, especially during the open enrollment periods, which overlap with tax preparation season. The distribution of the 1095-B tax form will likely generate its own share of inquiries and will also have a peak period. Based on our experience supporting six SBMs with the distribution of the 1095-A tax form during the last tax period, MAXIMUS estimates more than 25 percent of consumers who receive the 1095-B forms will call the Medicaid or CHIP contact centers with have questions regarding 1095-B forms. In many cases, the SBM call centers also handle calls related to CHIP and Medicaid.
In order to ensure that consumers have what they need to understand the 1095-B tax form, why they need them for their tax filing, and how to address any information discrepancies, Medicaid and CHIP agencies should consider a few key strategies:
Plan for volume: Contact centers must be able to quickly and efficiently scale up to support an increase of incoming calls when the forms are delivered, as well as an even higher surge of inquiry calls in March and April, when most consumers are preparing to file their taxes.
Provide resources: Consumer-facing channels should contain informational resources about the 1095-B tax form that provide self-help for finding answers to their questions. Making this information readily available through websites, social media channels and integrated voice response systems helps consumers address frequently asked questions on their own, which allows trained call center representatives to focus on those with more complex needs.
States should also ensure that the informational materials they provide comply with literacy best practices from the Centers for Disease Control (CDC): the information needs to be accurate, accessible and actionable. The MAXIMUS Center for Health Literacy also provides advice to help ensure that materials are written in plain language and formatted in ways that help readers find and understand key messages.
Train and educate: As with the 1095-A tax forms, Medicaid and CHIP agencies should consider training in-person assisters (IPAs) to answer questions about the 1095-B tax form and direct citizens to additional resources. Many people still want a face-to-face interaction when they have questions, especially with anything related to their health coverage and taxes, and the IPAs can serve a valuable role in ensuring a smoother process for consumers.
Getting Started Now
There will be a significant effort needed to ensure that state Medicaid and CHIP agencies successfully complete the 1095-B process, including delivering tax forms to enrollees by January 31, 2016 and helping them understand the forms. The time is now to consider the best and most efficient ways to support this process, from training contact center support and assisters, creating forms, fulfilling mail services and processing returned mail.
As Americans adjust to receiving health insurance coverage under the ACA, both states and consumers are adapting to new rules and regulations for this evolving process. Receiving a tax form to verify insurance coverage is certainly another one of the new changes. Government health insurance program administrators, such as Medicaid and CHIP agencies, must work to develop a consumer-oriented process that is as positive and efficient as possible for both states and consumers.