Doh! Obamacare Website Botches Subsidies for 800,000
Policy + Politics

Doh! Obamacare Website Botches Subsidies for 800,000

iStockphoto/The Fiscal Times

Obamacare’s first tax filing season is not off to a great start.

Health officials confirmed Friday that the  at least 800,000 Obamacare enrollees received the wrong tax information, which will likely delay their tax returns by several months and potentially affect the amount of tax credits they receive for health coverage.

The errors were found in the new 1095-AS forms that are sent to consumers enrolling in coverage through the federal exchange. The forms are supposed to detail what, if any, federal subsidies consumers received in 2014 to put toward their monthly premiums and determine whether those subsidies were correct. However, the federal government used the wrong formula to calculate the subsidies on about 20 percent of these forms.

Related: Obamacare Enrollees Could Get Hit With Surprise Costs

This means that nearly one million people could receive subsidies that are either too high or too low.

Now the administration is contacting these people to tell them to delay filing their tax return while the issue is being resolved.

The screw up is unwelcome news for the administration, which has been basking in some rare good news after it reported that 11.4 people signed up for coverage on the state and federal exchanges. That figure, which does not include people who paid their premiums, is expected to climb in the coming months during a special 6-week enrollment period created for uninsured people who may have been unaware of the tax penalty for not having health coverage.

Related: How Obamacare Rates with Consumers One Year Later 

It’s also not likely to bode well on Capitol Hill, where Republicans are clamoring to attack the law. Unsurprisingly, GOP lawmakers quickly jumped on the news. 

“This is beyond embarrassing for President Obama and is an unfair blow to taxpayers who are once again left holding the bag for this administration’s incompetence,” Rep. Diane Black(R-TN) said in a statement.

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