Income-Verification Provision Won’t Disrupt Obamacare

A woman looks at the HealthCare.gov insurance exchange internet site October 1, 2013 in Washington, DC.
National Journal
Catherine Hollander
Add to Briefcase
See more stories about...
Catherine Hollander
Oct. 17, 2013, 4:35 p.m.

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 »
TWO MONTHS AFTER REFUSING AT CONVENTION
Cruz to Back Trump
1 days ago
THE LATEST
WHO TO BELIEVE?
Two Polls for Clinton, One for Trump
1 days ago
THE LATEST

With three days until the first debate, the polls are coming fast and furious. The latest round:

  • An Associated Press/Gfk poll of registered voters found very few voters committed, with Clin­ton lead­ing Trump, 37% to 29%, and Gary John­son at 7%.
  • A Mc­Clatchy-Mar­ist poll gave Clin­ton a six-point edge, 45% to 39%, in a four-way bal­lot test. Johnson pulls 10% support, with Jill Stein at 4%.
  • Rasmussen, which has drawn criticism for continually showing Donald Trump doing much better than he does in other polls, is at it again. A new survey gives Trump a five-point lead, 44%-39%.
NO SURPRISE
Trump Eschewing Briefing Materials in Debate Prep
1 days ago
THE DETAILS

In contrast to Hillary Clinton's meticulous debate practice sessions, Donald Trump "is largely shun­ning tra­di­tion­al de­bate pre­par­a­tions, but has been watch­ing video of…Clin­ton’s best and worst de­bate mo­ments, look­ing for her vul­ner­ab­il­it­ies.” Trump “has paid only curs­ory at­ten­tion to brief­ing ma­ter­i­als. He has re­fused to use lecterns in mock de­bate ses­sions des­pite the ur­ging of his ad­visers. He prefers spit­balling ideas with his team rather than hon­ing them in­to crisp, two-minute an­swers.”

Source:
TRUMP NO HABLA ESPANOL
Trump Makes No Outreach to Spanish Speakers
1 days ago
WHY WE CARE

Donald Trump "is on the precipice of becoming the only major-party presidential candidate this century not to reach out to millions of American voters whose dominant, first or just preferred language is Spanish. Trump has not only failed to buy any Spanish-language television or radio ads, he so far has avoided even offering a translation of his website into Spanish, breaking with two decades of bipartisan tradition."

Source:
$1.16 MILLION
Clintons Buy the House Next Door in Chappaqua
2 days ago
WHY WE CARE

Bill and Hillary Clinton have purchased the home next door to their primary residence in tony Chappaqua, New York, for $1.16 million. "By purchasing the new home, the Clinton's now own the entire cul-de-sac at the end of the road in the leafy New York suburb. The purchase makes it easier for the United States Secret Service to protect the former president and possible future commander in chief."

Source:
×