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The federal Obamacare website Healthcare.gov is failing to verify the eligibility of applicants receiving tax credits, according to a new report by the Health and Human Services’ Office of Inspector General (HHS OIG).

In order to be eligible for a Qualified Health Plan (QHP), Healthcare.gov is required by law to verify the personal information of an applicant. However, according to the OIG, the verification process is failing to verify Social Security numbers, failing to verify citizenship, failing to verify household income, and failing to resolve inconsistencies related to eligibility requirements.

As a result, this means that it is not possible to tell if individuals received the correct tax credit (APTC) or cost sharing reductions, or if they were eligible at all. As the report notes:

“Without properly verifying an applicant’s eligibility and properly resolving and expiring inconsistencies, the Federal marketplace cannot ensure that the applicant meets eligibility requirements for enrollment in a QHP and for insurance affordability programs and that the amounts of the APTC  and cost-sharing reductions are determined correctly.”

While HHS OIG points out that the existence of these control deficiencies does not necessarily mean that individuals improperly received QHPs or subsidies, other reports have found that billions of dollars have been distributed without due diligence:

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

 

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

 

  • A May 11, 2015 report by the Treasury Inspector General for Tax Administration (TIGTA) found that the IRS was failing to verify whether individuals had even bought health insurance before distributing tax credits.

 

The chaos behind Obamacare’s enrollment and subsidies should not be surprising given the system was integrated with many key features missing. In fact, the CEO of Healthcare.gov acknowledged in February that the website’s back-end will not be completed until after President Obama leaves office.