Covered California Sends Out 100,000 Inaccurate Tax Forms; About 1 In 8 Get Wrong Info

SACRAMENTO, Calif. (AP) - California's health exchange apologized Thursday for sending about 100,000 incorrect tax forms last month to people who purchased private coverage, a mistake that could delay tax filings or force households to amend their taxes.

Covered California acknowledged that it sent out inaccurate coverage information on 1095-A forms and is in the process of sending out revised forms, said spokesman James Scullary. In all, the state sent out 800,000 forms for the first time this year.

"We certainly apologized for any inconvenience," Scullary said. "It's all a new process and this is the first year there's a connection between health care and taxes."

The mistake brings another headache for people struggling to understand the new tax penalties. The federal health care reform law requires most people to have insurance or face a tax penalty that increases each year.

The penalty for a person who makes $40,000 a year will increase from $299 in 2014 to nearly $600 in 2015. And a family of four with that same income would see fines increase from $500 to nearly $1,000.

The exchange said many of the mistakes on the tax forms were related to number of months a household had coverage. For example, the 1095-A form may have stated that a family had coverage from April through September, but the family was covered from April through October.

The state sent email and postcard notices to people who received the incorrect forms to let them know they would be receiving new forms. All updated forms should be sent out in the next few weeks, Scullary said.

Anyone who received a wrong tax form but has already filed their tax return is being advised to consult a tax professional.

Consumers have complained about poor customer service, difficulty making changes, as well as trouble getting or dropping coverage since the online marketplace launched in October 2013.

As part of the state's implementation of the federal Affordable Care Act, Covered California offers sliding-scale subsidies for private coverage to lower-income and middle-class people with no access to health care on the job, and directs the poor to county social service offices for Medi-Cal.

California reported this week that it was falling 300,000 short of its goal to sign up 1.7 million people for private insurance in the second year of the expansion.

Copyright 2015 The Associated Press.