Trust, Don't Verify: Obamacare Exchanges Do Not Have to Check Applicants' Claims

By Susan Jones | July 8, 2013 | 7:45am EDT

Draft of application for Affordable Care Act. (AP Photo)

( - In a Friday "document dump," the Health and Human Services Department announced it will not require the new state health insurance exchanges to verify consumers' incomes to see if they qualify for health insurance subsidies.

Nor will HHS require the state exchanges to verify whether consumers can get affordable insurance through their employers.

Instead, the federal government will rely on what consumers tell them -- until 2015, when it plans to have stronger verification systems in place, the Washington Post reported.

Individuals making up to about $45,000 and families of four making up to about $94,000 annually will be eligible for sliding-scale subsidies to purchase health insurance in the new exchanges.

"We believe it is an ideal approach to provide flexibility in the case of many verifications," HHS said on page 345 of its 606-page final rule.

According to the Washington Post:

After encountering “legislative and operational barriers,” the federal government will not require the District and the 16 states that are running their own marketplaces to verify a consumer’s statement that they do not receive health insurance from their employer.

“The exchange may accept the applicant’s attestation regarding enrollment in eligible employer-sponsored plan . . . without further verification,” according to the final rule.

The federal government will, however, conduct an audit for the states where it is managing the new insurance Web portal.

The rule also scaled back states’ responsibilities to double-check the income levels that consumers report, which determine any tax subsidy they receive.

While initial regulations had proposed an audit of each consumer who reported an income significantly lower than what federal records indicated, the final rule scaled that back to an audit of a statistically significant sample of such cases.

For individuals who are not part of that sample, “the Exchange may accept the attestation of projected annual household income without further verification,” it said.

The Obama administration announced on July 2 that it is giving businesses an extra year to provide the required health insurance coverage to their full-time employees without risk of incurring tax penalties.

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