The IRS is plowing ahead with controversial plans to use its files to try to prod more people to sign up for Obamacare — but the tax agency has promised Congress it won’t break any privacy laws.
The letters are set to go out beginning next week, and are aimed at Americans who are paying the tax penalty rather than obtaining health insurance under the Affordable Care Act. The IRS says the 2010 law requires it to inform those individuals they could do better by signing up for the embattled program.
“In keeping with our commitment to taxpayer confidentiality, we will send the letters directly to taxpayers; under no circumstances will we share the identities of these taxpayers or any other protected taxpayer information with CMS or with any other entity,” IRS Commissioner John G. Koskinen told Congress on Oct. 31, in documents obtained by The Washington Times.
But congressional Republicans, already intent on repealing the health law, say tapping the IRS to boost Obamacare is dangerous, and risks disclosure of taxpayers’ secret information to others in the government.
According to congressional aides, the IRS is set to dispatch the letters in two batches before key enrollment deadlines.
It will send notices to 800,000 filers between Nov. 28 and Dec. 5 — ahead of the Dec. 15 deadline to buy a plan in time to be covered by Jan. 1. An additional 6.7 million Obamacare holdouts will see an IRS notice in January as the administration makes a last-ditch plea for sign-ups ahead of the final Jan. 31 deadline.
Draft versions of the letters warn recipients that they owed a penalty in 2015 and, unless they sign up now, will “likely owe a penalty for 2017 as well.”
Some versions of the letter even detail the potential costs — a minimum of $695 for an adult, with the chance for a much higher penalty “depending on your income.” Those with higher incomes must pay 2.5 percent of their earnings.
The letters say enrolling in an Obamacare exchange plan generally costs $75 per month or less once taxpayer-funded subsidies are taken into account.
The campaign is part of President Obama’s attempts to put his signature law on firmer footing by driving up enrollment, particularly among young, healthy people, who could stabilize premiums under the program, before he hands off his legacy item to President-elect Donald Trump.
The Obama administration had hoped to be turning the fate of the law over to Hillary Clinton, who had said she would defend and build on Obamacare.
Instead, the 2017 sign-up season will conclude under a Trump administration that’s vowed to unravel the exchanges as part of a broader push to repeal and replace the law.
This year marks the first time the IRS and the Centers for Medicare & Medicaid Services, which runs the federal exchange, have teamed up to promote the law.
House Majority Leader Kevin McCarthy, Majority Whip Steve Scalise and Ways and Means Chairman Kevin Brady, Texas Republican, objected to the letter campaign earlier this year, saying the IRS’ decision to collaborate with a health care agency was an improper use of its resources and amounted to harassment of taxpayers.
Rep. Steve King, Iowa Republican, said if the IRS is willing to collaborate with health agencies, it should also work with the Department of Homeland Security and the Social Security Administration more to root out illegal immigrants.