Did Obamacare Enrollees Game the System on the Taxpayer’s Dime?

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Early in the Obamacare enrollment saga, policy experts cautioned that the government’s official signup figure could not be seamlessly equated to the total number of Americans covered by policies purchased through the insurance exchanges set up under the Affordable Care Act.

That warning has proved to be correct, at least to a degree. Government documents provided to The Associated Press by the Department of Health and Human Services show that millions of enrollees entered incorrect data on their applications. Errors in income and citizenship status — which impact an enrollee’s eligibility for subsidized insurance coverage and, more broadly, participation in the exchanges — mean that total enrollments could drop slightly. To be clear, in some cases, the errors may be simply due to the fact that the information enrollees provided is more up-to-date than what is contained in official records, meaning that inconsistent data will cause only very few individuals to lose coverage, as government officials told reporters. The administration expects that the problems will be resolved by summer.

Already, a system has been put in place to “turn off” benefits for ineligible enrollees, the officials said. In the event that an enrollee underestimated annual income — and as a result received too generous a subsidy, which comes in the form of a tax credit — could owe the Internal Revenue Service money next year.

“The Marketplace checked to see that consumers are who they said they were, matching Social Security numbers, income and tribal status, among a host of other data points — all to ensure that folks are eligible for coverage and, in many cases, entitled to financial assistance to help them afford their plan … But, while most information the applicant provided lined up, sometimes a name or data point didn’t match up right away with existing records,” Centers for Medicare & Medicaid Services spokeswoman Julie Bataille wrote in a recent blog post.  “For example, a consumer might have recently changed jobs, but the latest IRS tax return data and other data available to the Marketplace didn’t reflect that change in income,” Bataille added. “In such cases, the law requires us to double and triple check this data in another way.”

Still, even if the situation is easily resolved, the fact that the paperwork 2.2 million enrollees — or more than one in every four that signed up for private health coverage through the system — contains seriously enough inconsistencies that coverage could be canceled or subsidies need to be repaid suggest there was a serious failing in the system. That is the argument Republican lawmakers have made. “A 25 percent error rate is simply unacceptable when it comes to proper use of scarce taxpayer dollars. Even worse, today’s announcement once again illustrates how the President’s bloated health care law has left American families and taxpayers in financial limbo,” said Senator Orrin Hatch of Utah, the ranking  Republican on the Senate Finance Committee, said in a press release.