The deal struck this week to reopen the government and avert default left the Affordable Care Act mostly untouched, with the single Obamacare provision that made it into the agreement unlikely to do much harm to the law.
The Health and Human Services secretary will now have to personally vouch to Congress that proper safeguards are in place to insure subsidies for buying health insurance go to only those who qualify. She’ll have to provide a report by Jan. 1 detailing how that will happen, and within seven months the HHS inspector general’s office will be required to produce its own report on how the verification systems are working.
Other than adding a few more reports, the provision barely changes the Affordable Care Act, and is a far cry from the delay, defund, or repeal cries Republicans sounded just weeks ago.
Under Obamacare, people earning one to four times the federal poverty level can get a subsidy to help pay for the health insurance plans, which they’re now required to hold. The insurance marketplaces, or exchanges, opened for business — some successfully, some not — on Oct. 1, and income-verification measures are already in place.
The exchanges compare applicants’ reported income with IRS and Social Security data, as well as wage information available through Equifax, a credit-reporting agency. If that doesn’t substantiate what an applicant says, the exchange will ask for additional information or documentation.
In July, the administration announced that in 16 states and Washington, which are running their own exchanges, they would make an exception for one year only. When an applicants’ projected income is more than 10 percent below what the IRS or Social Security data indicate, and there’s no Equifax data to support it, and the individual can’t provide a reasonable explanation for the change, states can choose not to audit them.
Instead — in 2014 only — the state exchanges have the option of auditing a statistically significant sample of this group rather than each member. Everyone applying for insurance would still be subject to perjury charges for lying.
It wasn’t immediately clear what the impact of Wednesday’s agreement would be on HHS’s decision to grant states that reprieve in 2014. Statistical verification is used by the IRS to verify claims, and the law did grant HHS flexibility in its implementation timeline, so it’s not clear the July decision would need to be changed.
HHS did not comment on the new provision.
Republicans have long raised concerns that Obamacare will encourage fraud, and the administration’s July announcement renewed those criticisms. “Remember ‘liar loans,’ the low- or no-documentation mortgages that took borrowers at their word without checking pay stubs or W-2s?” The Wall Street Journal editorial board wrote at the time. “Obamacare is now on the same honor system, with taxpayers in tow.”
The House GOP passed a bill last month that would tighten verification procedures by requiring the HHS inspector general to certify that a program to consistently and accurately verify income is in place before HHS can provide any subsidies. That had the potential to be seriously disruptive, as Judy Solomon, vice president for health at the left-leaning Center on Budget and Policy Priorities, pointed out: It wasn’t clear how the inspector general would audit something that did not yet exist, so the subsidies could have been delayed.
“While the bill may sound innocuous, it would effectively blow up the operations of the new exchanges by preventing subsidies from starting on January 1,” she wrote.
What ended up in the final agreement that lawmakers passed on Wednesday was significantly weaker and unlikely to change the Affordable Care Act’s implementation. The reports may provide Republicans an additional chance to scrutinize or criticize, but it won’t stop the ACA train from pulling out of the station.
What We're Following See More »
By the narrowest of margins, the Senate voted 51-50 this afternoon to begin debate on the House's legislation to repeal and replace Obamacare. Sens. Lisa Murkowski and Susan Collins defected from the GOP, but Vice President Pence broke a tie. Sen. John McCain returned from brain surgery to cast his vote.
"Republicans who interviewed Jared Kushner for more than three hours in the House’s Russia probe on Tuesday said the president’s son-in-law and adviser came across as candid and cooperative. 'His answers were forthcoming and complete. He satisfied all my questions,' said Rep. Mike Conaway (R-Texas), who’s leading the House Intelligence Committee’s investigation into Russian meddling in the 2016 election, including possible collusion between Moscow and the Trump campaign."
"A U.S. appeals court on Tuesday blocked a gun regulation in Washington, D.C., that limited the right to carry a handgun in public to those with a special need for self-defense, handing a victory to gun rights advocates. The U.S. Court of Appeals for the District of Columbia Circuit's 2-1 ruling struck down the local government's third major attempt in 40 years to limit handgun rights, citing what it said was scant but clear guidance from the U.S. Supreme Court on the right to bear arms."