by Katherine Restrepo
Director of Health Care Policy, John Locke Foundation
…Until the Obamacare marketplaces are scheduled to open for enrollment.
Yesterday’s Kaiser Health News article on applicants seeking to qualify for premium assistance tax credits on the health insurance marketplaces:
Under regulations released in July, all the exchanges or marketplaces must first check the income level that an individual reports on his or her application against a federal database that contains data on the applicant’s federal income tax returns as well as Social Security and current wage data.
But if an individual projects their income up to 10 percent higher than shown in electronically available data such as a prior tax return, there will be no questions asked. If there is more than a 10 percent discrepancy, the exchanges will ask for more information, such as a pay stub. If an applicant is unable to provide such data, the regulations allow the exchanges in 2014 to rely on the individual’s “self-attestation” to determine the subsidy. This applies only when someone overestimates their income, according to a spokeswoman for Health and Human Services.
Due to the loosened information reporting requirements under the employer mandate delay, it is expected that more workers living under 100% of the Federal Poverty Level (FPL) will game the system to receive marketplace subsidies in states that have NOT opted for Medicaid expansion. Under Obamacare, states have the option to expand Medicaid to childless adults up to 138% FPL. While a number of these citizens remain ineligible for Medicaid, they will also not qualify for premium assistance tax-credits distributed to workers earning annual household incomes from 100-400% FPL.
You can read more detailed examples of probable fraud in Chris Conover’s “The Dishonor System” here. It’s a must-read!