Due to administrative deficiencies as many as one-third or more of the 8 million Americans who signed up for Obama-care during its first open season should not actually qualify for its health insurance coverage or in some cases for subsidies. That is the devastating implication of a pair of recent reports by the Inspector General of the Health and Human Services Department (HHS).
They found, among other things, that the federal system for resolving inconsistencies between information provided by applicants and information from federal agencies on such matters as legal status, income and incarceration records was not fully functional during the sign-up period. Oops.
At this time last year it was increasingly apparent that HHS was not ready to roll out the first sign-up period for the Patient Protection and Affordable Care Act, and a number of experts, as well as most Republican legislators, urged President Obama to delay it. The new IG report suggests that this rejected advice would have saved the government considerable costs in correcting for a flawed process.
The reports found that a minimum of 2.9 million applications had at least one inconsistency and that of these, 2.6 million remain unresolved, even though presumably the applicants received the requested coverage. The total number of inconsistent applications is almost assuredly larger. HHS said it was unable to give a precise number, and the IG report lacked data from at least four states.
As a result, and based on incomplete records, as many as 1,295,571 applicants were not able to verify their claim to being legal residents of the United States as required by the ACA. Allowing for the rare erroneous record, that suggests that many illegal immigrants were able to sign up, against the law.
The largest other unverified claim was income. However, HHS pointed out in its response to the IG report that IRS income data available to claims processors would be at least two years out of date.
HHS said it is making progress correcting the administrative flaws pointed out by the IG.
But that misses the point. The health care exchanges were launched prematurely by an administration that could not wait to get things right. Now it must untangle the mess it made, at our expense.