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How the health insurance box on Md. tax forms will work

The Maryland tax form section that will ask filers if they have health insurance.

The Maryland tax form section that will ask filers if they have health insurance.

Beginning Jan. 27, Maryland tax filers will be able to check a box saying whether they have health insurance and, if they do not, whether they would like to receive information about their eligibility for free or reduced coverage.

The Maryland Easy Enrollment Health Insurance Program came out of an attempt to replicate the Affordable Care Act’s individual mandate. Instead of a mandate, the program offers tax filers the opportunity to find out about health insurance options available to them.

“The premise is very simple,” Heather Forsyth, the Maryland Health Benefit Exchange’s director of consumer assistance, eligibility and business integration, told lawmakers at a briefing on the program Tuesday. ”We want to reduce the rate of uninsured Marylanders … increase stability in the market… and make it easier to enroll in coverage.”

The health exchange and Maryland Office of the Comptroller have been working since the legislation passed last year to figure out how to incorporate the question into this year’s tax forms.

The tax forms were settled on as a natural place for the question because most people file them. Additionally, the forms include the same income information that can be used to determine eligibility for Medicaid or for tax subsidies that can make exchange-purchased insurance cheaper, or nearly free in some cases.

About 6% of Marylanders are uninsured, just under 400,000 people. A little more than 162,000 of those people are eligible for free or reduced coverage, Forsyth said.

For those who file tax returns, they could find out that they are eligible for that free or reduced coverage. The forms authorize the comptroller to pass along some of their information so the exchange can determine their eligibility for subsidies or Medicaid. Then the exchange reaches out to see if they want to pursue applying for coverage.

The data collected on the tax forms could also give the state a better idea of who does not have insurance. Through the forms, officials can collect information on the income, region and in some cases race of Maryland’s uninsured population. (Race is an optional question on state tax forms.)

With the uninsured population, they may also be able to determine the value of tax credits that are unused by people who choose to go without insurance.

Most of this information will be done online. Eighty-two percent of filers last year completed their forms online directly or through a third-party preparer, said Debora Gorman, deputy director of the comptroller’s revenue administration division.

For electronic filers who want their information sent to the exchange, it will happen once they file. The first day of tax filing this year is Jan. 27.

This year has been the first phase of putting health insurance on the tax forms. The second phase, for next year’s forms, will likely collect more data.

But some tax preparers are raising questions about what that will look like, Gorman said. They have some concerns about asking clients about health information, like whether they are pregnant.

“It’s not typically the type of information that a tax preparer would be asking their client,” she said. “This is a new world for them.”


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