HHS to probe up to two million ObamaCare enrollees for subsidy eligibility
posted at 10:41 am on June 16, 2014 by Ed Morrissey
So much for that victory lap from Barack Obama over having signed up eight million people into ObamaCare. Even while Obama himself lauded the achievement, insurers warned that 20% of those sign-ups would not end up being legitimate enrollments due to non-payment of the premiums. We then discovered that three out of every four enrollees already had health insurance before ObamaCare. Two weeks ago, the AP reported that as many as two million Medicaid enrollees through Healthcare.gov may not be eligible for coverage.
If that 8 million figure looked shaky before this weekend, the New York Times drives a stake through its heart with its report on another eligibility-verification issue. Two million enrollees in exchange plans submitted subsidy-eligibility documentation that differed from other government records, prompting an initial probe of “hundreds of thousands” covered in the exchanges. Many may have to repay the federal government if they cannot establish a legitimate eligibility, and may end up losing their insurance plan altogether:
The Obama administration is contacting hundreds of thousands of people with subsidized health insurance to resolve questions about their eligibility, as consumer advocates express concern that many will be required to repay some or all of the subsidies.
Of the eight million people who signed up for private health plans through insurance exchanges under the new health care law, two million reported personal information that differed from data in government records, according to federal officials and Serco, the company hired to resolve such inconsistencies.
The government is asking consumers for additional documents to verify their income, citizenship, immigration status and Social Security numbers, as well as any health coverage that they may have from employers. People who do not provide the information risk losing their subsidized coverage and may have to repay subsidies next April. …
Since June 1, the government has notified hundreds of thousands of people that “the information in your application doesn’t match what we found in other records.” Accordingly, the notice says, “you need to follow up as soon as possible and provide more documents to make sure the marketplace has the correct information.”
“If you don’t send the needed documents,” it says, “you risk losing your marketplace coverage or help you may be receiving to pay for such coverage.”
Just how may of those eight million enrollees remain? One million? Fifty thousand? A minyan? What?
This is a direct result of HHS’ failure to produce the necessary enrollment systems by deadline. The original concept for Healthcare.gov and the state exchanges was an instant eligibility verification system that would integrate the application process with IRS data. That fell by the wayside despite having 42 months and $400 million to build the federal system, plus hundreds of millions if not billions going to states with their own exchanges. Critics warned that going live without those verification checks built into the system would create massive fraud.
It looks like that prediction was even more accurate than first thought. Two million mismatches is 25% of the Obama administration’s claimed success from the open-enrollment period, and HHS has paid $4.7 billion in subsidies already. More than 80% of those private-plan enrollments included subsidy payments, which makes the potential fraud level high indeed.