Report Uncovers Stonewalling of Illegal Obamacare Payments

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Posted by Alexander Hendrie on Thursday, July 7th, 2016, 9:53 AM PERMALINK

The Obama administration has been illegally funding Obamacare “Cost Sharing Reduction” (CSR) payments for years over the objections of IRS officials, according to a report released today by the House Ways and Means Committee and the House Energy and Commerce Committee. Since Congress launched its investigation, multiple agencies have refused to provide information, selectively applied the law, and even pressured one witness not to testify.

Key findings:

-The administration initially submitted a CSR appropriations request for Fiscal Year 2014, but later withdrew it and began making payments illegally. As the report notes, Obamacare created CSR payments, but they have never been appropriated for. The Constitution explicitly makes clear that the power of the purse lies with Congress and the Executive cannot spend taxpayer money without Congressional approval.

-CSR payments were created as one way to artificially hide the true costs of Obamacare through a web of government spending programs. CSR payments would be given to an insurance company based on the income of an enrollee and the plan they purchased. Assuming certain criteria were met, the insurance company would receive federal dollars as an incentive to keep co-payments, deductibles, and other out of pocket costs low.

-After officials from the Obama Department of Health and Human Services (HHS) withdrew the CSR appropriations request, the administration begun illegally shifting funds from a separate appropriation. The administration has refused to provide the legal memorandum that led to this decision even in the face of Congressional subpoenas.

-IRS officials expressed concern that this method of funding CSR payments was illegal so were briefed on the memorandum. As the report notes in an interview with one IRS official at the meeting, they were not permitted to take notes or keep a copy of the memo:

“We were given a memo to read. We were instructed we were not to take notes and we would not be keeping the memo, we’d be giving it back at the end of the meeting.”

-Following this meeting, IRS officials continued to have concerns that the CSR payments violated federal law and raised concerns with IRS Chief John Koskinen. As the report notes, these concerns were heard, but ignored:

“The IRS officials’ concerns that this course of action violated appropriations law were noted, but not addressed or ameliorated by OMB’s legal memorandum.”

-Shortly thereafter, DoJ and Treasury officials officially approved the decision to use an unrelated appropriation to make CSR payments.

Since Congress launched its investigation, multiple Obama government agencies have undertaken a concerted effort to hide the truth by refusing to provide, or unlawfully redacting documents, refusing to answer questions or allow witnesses to testify, and selectively applying the law. In at least one case, the Obama administration pressured a witness into not revealing information, and in another case the administration prevented a witness from answering questions.

As the report notes:

  • The Department of the Treasury improperly withheld and redacted documents without any valid legal basis to do so.
  • The Department of Health and Human Services improperly withheld documents without any valid legal basis to do so.
  • The Office of Management and Budget improperly withheld documents without any valid legal basis to do so.
  • The Department of the Treasury failed to search for records responsive to the committees’ subpoenas.
  • Treasury used regulations and Testimony Authorizations to prohibit current and former IRS employees from providing testimony to Congress about the source of funding for the CSR program.
  • Treasury officials selectively enforced the law by allowing witnesses to answer certain questions prohibited by the authorizations without objection
  • HHS counsel prevented witnesses from answering substantive questions regarding the CSR, citing the need to protect “internal deliberations” and “confidentiality interests”
  • Witnesses were instructed not to reveal the names of White House and DoJ officials involved in decisions regarding the cost sharing reduction program.
  • The Department of the Treasury pressured at least one witness into following the restrictions set forth in his Testimony Authorization after the witness questioned Treasury’s ability to limit his testimony.
  • OMB prevented a witness from answering factual questions regarding the dates or times of a meeting or conversation, refusing to invoke a legal privilege to justify withholding the information from Congress.

 

Photo Credit: 
https://www.flickr.com/photos/charlesfettinger/

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