Submitted by: Phil Bulfinch
Feds Can’t Verify $2.8 Billion in Obamacare Subsidies
CMS does not know if subsidies went to ‘confirmed enrollees, in the correct amounts’
BY: Elizabeth Harrington
June 16, 2015 1:10 pm
June 16, 2015 1:10 pm
The
federal government cannot verify nearly $3 billion in subsidies
distributed through Obamacare, putting significant taxpayer funding “at
risk,” according to a new audit report.
The Department of Health and Human Services (HHS) Office of Inspector General (OIG) released an audit Tuesday finding that the agency did not have an internal system to ensure that subsidies went to the right enrollees, or in the correct amounts.
“[The
Centers for Medicare and Medicaid Services] CMS’s internal controls did
not effectively ensure the accuracy of nearly $2.8 billion in aggregate
financial assistance payments made to insurance companies under the
Affordable Care Act during the first four months that these payments
were made,” the OIG said.
“CMS’s system of internal controls could not ensure that CMS made correct financial assistance payments,” they said.
The OIG reviewed subsidies paid to insurance companies between January and April 2014. The audit found that CMS did not have a process to “prevent or detect any possible substantial errors” in subsidy payments.
The
OIG said the agency did not have a system to “ensure that financial
assistance payments were made on behalf of confirmed enrollees and in
the correct amounts.”
In
addition, CMS relied too heavily on data from health insurance
companies and had no system for state-based exchanges to “submit
enrollee eligibility data for financial assistance payments.”
The government does “not plan to perform a timely reconciliation” of the $2.8 billion in subsidies.
The audit was released as the country awaits a Supreme Court ruling that could make all federal subsidies invalid, since the majority of states did not set up their own health insurance exchange.
Eligible
individuals enrolled in Obamacare can receive different types of
subsidies, including advance premium tax credits (APTCs) and advance
cost-sharing reductions (CSR), which can be used towards premiums or
out-of-pocket health care costs.
According
to the OIG, the government still does not have a complete system for
approving subsidies distributed though Obamacare. CMS used an “interim
process” to distribute subsidies for 2014, and is planning a “permanent
process” to be finished by late 2015. The final system is supposed to
approve enrollment and payment data “on an enrollee-by-enrollee basis.”
“Without
effective internal controls for ensuring that advance CSR payments are
reconciled in a timely manner, a significant amount of Federal funds are
at risk,” the OIG said.
The
report noted that multiple agencies within CMS oversee subsidy
payments, including the Center for Consumer Information and Insurance
Oversight (CCIIO), the Office of Financial Management (OFM), the Office
of the Actuary (OACT), and the Office of Information Systems (OIS).
In response to the audit, CMS said they issued a regulation to change their accounting methods. “CMS
takes the stewardship of tax dollars seriously and implemented a series
of payment and process controls to assist in making manual financial
assistance payments accurately to issuers,” they said.
This entry was posted in Issues and tagged Government Spending, Government Waste, HHS, Inspector General,Obamacare. Bookmark the permalink.
(I must be crazy…)
Phil Bulfinch
Atlas Ag Management LLC
Orilla de Rancho Cielo
PO Box F
Pala, CA 92059
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