I do my family’s federal taxes by Valentine’s Day as we have two kids in daycare, and the refund is a nice means of forced savings that pays for a couple of months of day care with psychologically bucketed “Extra” money. People who are anal retentive or OCD(ish) tend to file early as well as people who know they qualify for Earned Income Tax Credit and need the money immediately tend to file early. Individuals who know they have a complex tax situation may start the process early. But most people who know they have a relatively simple return and don’t need the money immediately don’t file their taxes in the first week of February. They instead wait until the Final 4 is over before filing.
This is important as Obamacare enrollment pace is picking up. The early anal retentives or known needers are filing for insurance but more and more people who are not chronically ill are beginning to get on board:
The rate of enrollment in Covered California health plans has also increased. As of Nov. 19, 79,891 Californians had selected a health plan. Compared with the first week of October, during which about 700 people a day selected a health plan, the enrollment rate nearly quadrupled by the second week of November, to about 2,700 plan selections per day.
It is looking like California is seeing a November activity rate that is at least three if not four times higher than October’s rates.
One big difference on the timing of filing for taxes and buying health insurance on line is that most people who file a tax refund expect either to break even or to get money back. People looking to buy health insurance are expecting to spend some money. Getting money for free is a motivator while spending money is a depressor of action. Using this logic, we should expect to see more early Medicaid sign-ups as the cost to the individual is effectively nil while Exchange insurance costs money which will lead to delay and surge.