Current exchange plan users who ignore advice to update their exchange application information could end up owing money to the Internal Revenue Service (IRS) in 2016.
Officials at the Center for Consumer Information and Insurance Oversight (CCIIO) — the arm of the U.S. Department of Health and Human Services (HHS) responsible for running the Patient Protection and Affordable Care Act (PPACA) exchange system — talk about the dangers facing exchange users who fail to update their information in a new 2015 renewal and re-enrollment process slide deck.
The information affects consumers enrolling in coverage through the HHS HealthCare.gov system.
Low-income consumers have a strong financial incentive to buy through the public exchange system to qualify for new PPACA premium and cost-sharing subsidies available only through the exchange system.
Some high-income consumers may use the public exchange system to support the exchange system, for reasons of convenience, or because they prefer the qualified health plans (QHPs) available through the exchange system to off-exchange products.
If current QHP users have incomes over 500 percent of the federal poverty level (FPL), or have sidestepped the exchange subsidy eligibility verification process by refusing to let the exchange system use IRS income information, they can also go through an automatic re-enrollment process, officials say.