Obamacare exchanges are failing to provide adequate enrollment information to the IRS for the payment and verification of tax credits, according to a new report released by the Treasury Inspector General for Tax Administration (TIGTA).

In order for the IRS to properly administer Obamacare, exchanges are required to provide monthly enrollment data, known as “Exchange Periodic Data.” As part of the law, Obamacare enrollees may elect to have their estimated tax credit sent directly to their insurance provider as partial payment for monthly premiums. But because this is only an estimate based on expected income, the IRS relies on Exchange Periodic Data to ensure that individuals have received the proper tax credit, or if they were eligible at all.

However, as the report notes, both the federal exchange and many of the 15 state exchanges have failed to provide this data:

“The IRS did not receive the required Exchange Periodic Data from all of the Exchanges as of the start of the filing season (January 20, 2015).  For example, the IRS did not receive Exchange Periodic Data for approximately 1.7 million (40 percent) of the approximately 4.2 million Federal Exchange enrollment records and did not receive the Exchange Periodic Data from six of the 15 State Exchanges.”

The report did not say which of the 15 state exchanges had failed to provided Exchange Periodic Data.

This is not the first time watchdog groups have raised concerns over Obamacare tax credits. In the past few months, at least four reports have found flaws in the system:

  • A August 2015 report by the Health and Human Services Office of Inspector General (HHS OIG) found that the federal exchange is failing to verify Social Security numbers, citizenship, and household income of Obamacare applicants. As a result, the exchange is unable to verify whether applicants are properly receiving tax credits.


  • A July 16, 2015 audit by the Government Accountability Office (GAO) found that 11 of 12 fake ‘test’ applicants received coverage for the entire 2014 coverage period despite many using fraudulent documents, and others providing no documentation at all. From these 11 applicants alone, Healthcare.gov paid $30,000 in tax credits.


  • A June 16, 2015 report released by the HHS OIG found that $2.8 billion worth of Obamacare subsidies and payments had been made in 2014 without verification.


  • A May 11, 2015 report by TIGTA found that the IRS was failing to verify whether individuals had even bought health insurance before distributing tax credits.


HHS OIG is continuing to evaluate the effectiveness of Obamacare tax credit controls, according to the latest TIGTA report. However, TIGTA issued no recommendations in the report because it was intended to provide interim information only.