NCPA - National Center for Policy Analysis

Health Insurance Marketplaces Will Not Be Required to Verify Consumer Claims

July 9, 2013

The Obama administration announced Friday that it would significantly scale back the health law's requirements that new insurance marketplaces verify consumers' income and health insurance status. Instead, the federal government will rely more heavily on consumers' self-reported information until 2015, when it plans to have stronger verification systems in place, says the Washington Post.

  • The delay comes after a recent announcement that the federal government would postpone for one year a requirement that employers with 50 or more full-time workers provide health coverage.
  • The verification systems are meant to determine who qualifies for new benefits under the Affordable Care Act.
  • The law includes tax subsidies to purchase health insurance for Americans who earn less than 400 percent of the poverty line, about $45,000 for an individual.
  • Those earning less than 133 percent of the poverty line -- about $15,000 -- will qualify for Medicaid coverage in the District and 23 states that have decided to expand the program.

The federal government also needs to know who receives health insurance coverage from an employer. Consumers who receive affordable health insurance from their company under a policy that costs less than 9.5 percent of their income do not qualify for tax credits under the Affordable Care Act.

New regulations published Friday scaled back the federal government's role in determining whether information submitted to new health marketplace is accurate.

  • 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 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.

Source: Sarah Kliff and Sandhya Somashekhar, "Health Insurance Marketplaces Will Not Be Required to Verify Consumer Claims," Washington Post, July 5, 2013.


Browse more articles on Health Issues