Senate Democrats for Health Care Fraud

 As previously noted, the Senate is expected to vote this week on a resolution offered by Sen. Mark Warner (D-VA) that would nullify the Trump Administration’s Marketplace Integrity rule finalized in June. In addition to taking action to restrict taxpayer funding of sex-change modification procedures, the rule also includes several provisions designed to prevent fraud.

The common-sense program integrity provisions included in the rule, and which the Warner resolution would strike down, include:

1. Requiring people who do not actively enroll themselves every year, and are instead auto-enrolled into the same plan, to pay a $5 monthly premium—a means of deterring fraudulent “ghost enrollees” who keep receiving “free” (i.e., zero-premium) coverage. Enrollees could avoid this modest charge just by going back to the Exchange and confirming their name, identity, and estimated income for the upcoming plan year.

2. Where permitted by state law, allowing insurers to condition enrollment on payment of past-due premiums from prior coverage, so enrollees do not game the system by continually enrolling in and dropping coverage.

3. Requiring subsidy recipients to file their tax returns every year, so they reconcile the amount of subsidies they received during the year (based on projected income) with the subsidies they should have received (based on actual income). Most of us have to file our taxes every year—but many subsidy-eligible households do not have income tax liability, and the Biden Administration permitted them to file and reconcile their subsidies every other year.

4. Requiring verification for special enrollment periods, most of which currently operate via self-attestation (aka the “honor system,”) allowing enrollees to game the system by signing up for coverage immediately upon getting sick.

5. Requiring income verification when the IRS believes the subsidy applicant has income less than the poverty level—the Congressional Budget Office notes that 2.3 million applicants this year alone have fraudulently claimed they have income just above poverty (the threshold to qualify for subsidies)—or when the IRS finds no tax data available.

6. Allowing slightly more flexibility regarding the ranges for determining plan actuarial value (e.g., the definition of bronze, silver, gold, and platinum plans).

7. Eliminating subsidy eligibility for “Dreamers” remaining in the country under DACA, a Biden-era policy that a federal judge had previously struck down last December.

8. Establishing standards for terminating fraudulent agents or brokers for cause.

9. Removing a continuous special enrollment period based on income, whereby households who qualify for “free” (i.e., zero-premium) coverage can sign up any day of the year.

10. A more accurate measure of measuring health expenses to adjust plan thresholds (e.g., out-of-pocket maximums, etc.) for inflation every year.
    
    It’s also worth noting that a federal judge in August struck down the first six of these reforms, meaning they have not yet gone into effect. (A Centers for Medicare and Medicaid Services breakout of which elements of the Marketplace Integrity rule are and are not in effect this open enrollment season is available here.)
    
    Ironically enough, Senate Democrats have introduced legislation increasing penalties for fraudulent actions by agents and brokers—yet appear ready to oppose a rule by the Trump Administration that would effectively accomplish much of those same objectives. At some point one has to ask: Is there any fraud restriction Democrats actually will support?
    
    https://juniperresearchgroup.substack.com/p/senate-democrats-for-health-care