Letter to Sylvia Mathews Burwell, Secretary of the U.S. Department of Health and Human Services, and Marilyn Tavenner, Administrator of the Centers for Medicare and Medicaid Services - Incorrect Tax Information Goes to Government Health Insurance Policyholders

Letter

February 23, 2015

The Honorable Sylvia Mathews Burwell
Secretary
U.S. Department of Health and Human Services
200 Independence Avenue, SW Washington, DC 20201

The Honorable Marilyn Tavenner
Administrator
Centers for Medicare & Medicaid Services
200 Independence Avenue, S.W. Washington, D.C. 20201

Dear Secretary Burwell and Ms. Tavenner:

I am troubled by recent reports that the Department of Health and Human Services (HHS) sent incorrect tax information to 800,000 policyholders who enrolled in health plans through HealthCare.gov. I am writing to request information regarding HHS' actions to address this error, what steps are being taken to ensure it does not happen again, and how the Administration will ensure that taxpayers are not penalized as a result of HHS' error.

As you know, taxpayers need accurate information from HealthCare.gov in order to complete their tax returns and receive tax refunds from the IRS. I am concerned that HHS' error will place an undue burden on taxpayers in New Hampshire and across the country by delaying their ability to file and receive tax refunds until corrected forms are issued by the Treasury Department. In addition, the IRS indicated that about 50,000 affected people who have already filed tax returns may need to file amended returns. Given that the IRS projects that it will assist less than half of the taxpayers who reach out, these taxpayers may be left with little recourse and possibly an unexpected tax bill.

I am unsatisfied with the Administration's insufficient response to this error, which does not fully reflect the practical effect that the Administration's mistake will have on taxpayers. While the Administration claims taxpayers will have "ample time" to file before the April15 tax deadline, the delay in receiving tax refunds could cause hardships for those who rely on early refunds to help cover household costs.

Many New Hampshire families rely on tax refunds to help pay for everyday necessities, like home heating oil. Given this winter's cold temperatures and high home heating costs, Granite Staters need their refunds now - not in April. Even if the Department is able to send corrected forms by early March, as it has claimed it will, the delay could cause additional economic hardship for New Hampshire families who would otherwise be able to file now and use early refunds to help cover home heating expenses.

Therefore, I respectfully request a response that explains:

1. What is the root cause of the Department's error?

2. What steps will the Department take to ensure that similar mistakes do not occur again?

3. How will the Administration ensure that taxpayers are not penalized or inconvenienced by the Department's error?

In addition, please provide my office with a breakdown by state of the number of taxpayers impacted. Thank you for your attention to this matter. I look forward to your timely response.

Sincerely,

Kelly A. Ayotte
United States Senator

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