The IRS just updated its federal income tax filing statistics through March 14, 2014. Interestingly, total refunds as compared to this time last year appear to be up in both number (+2.3%) and amount (+4.2%).
The resulting rise in “cash on the street” partly explains the recent uptick in marketplace enrollment that HHS has reported two weeks ago and updated last Monday. Given the late start to the tax season this year, our projections indicate that HHS will achieve the federal enrollment goal of six million only if HHS allows folks to enroll through April 15th. During this two-week period alone, about $36 BILLION (note the big “B”!) in tax refunds flow to the public for returns filed in the lead-up weeks to the April 15th deadline. Based on experience to date, that injection of liquidity would make a huge difference in consumer’s willingness to sign up for new insurance plans.
So what will HHS do? We’ll just have to wait for April Fool’s Day to find out!