July 01,2014

Press Contact:

Aaron Fobes/Julia Lawless (202) 224-4515

Hatch Statement on Appalling HHS IG Findings on Obamacare Subsidies

WASHINGTON – U.S. Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance Committee, today issued the following statement regarding a new report from the Department of Health and Human Services (HHS) Office of Inspector General (OIG) entitled “Marketplaces Faced Early Challenges Resolving Inconsistencies With Applicant Data,” which details the Administration’s inability to establish protections for taxpayers in healthcare marketplaces that ensure subsidies are appropriately administered:

“When Obamacare was passed its chief architects told us they would have to pass the bill to find out what was in it.  Today's report confirms what we knew was not included: safeguards to protect hard-earned taxpayer dollars from an incompetent bureaucracy.  As today’s report shows, the federal marketplace was not able to resolve 2.6 of 2.9 million data inconsistencies.  A nearly 90% failure rate is absolutely preposterous and disgraceful.  But sadly, this too will likely fall on deaf ears for an Administration that continues to pour scarce taxpayer dollars down the bottomless well of Obamacare. It seems like almost every day new evidence proves Obamacare to be a bureaucratic and administrative nightmare that wastes taxpayer dollars and risks the security of taxpayer information.  It is time Democratic leaders in Washington put the concerns of American families ahead of their need to protect a failed political legacy."

Findings of the report include:

  • The marketplace was unable to resolve nearly 90% of inconsistencies, even if the applicant submitted appropriate documentation. 
  • Most inconsistencies related to citizenship and income, the first and most basic qualification criteria.
  • Without the ability to resolve inconsistencies in an applicant’s data, the marketplace cannot determine if the applicant is eligible for enrollment.  This should be step one in the enrollment process, but there is no confidence this is being done properly. 
  • Both Federal and state based marketplace websites continue to have problems, resulting in applicants not being able to enroll online.  These problems generated a backlog of paper applications for several states.
  • The Federal Data Hub created additional problems for states who attempted to appropriately process applications. 

o   The Data Hub was frequently inoperable, which meant states could not verify applicant data.

o   Federal data sources accessed through the Hub were frequently inaccurate, thus creating more inconsistencies.

o   One state marketplace reported that the Data Hub identified a set of infants and children as incarcerated, according to Federal data sources.

CMS concurred with OIG’s findings and recommendations.  However, CMS placed part of the blame for these failures on consumers who are inexperienced with the enrollment process.

In June, Senators Hatch and Grassley outlined how the Administration put politics ahead of operational realities, resulting in the botched rollout of HealthCare.gov in their report, “Red Flags: How Politics and Poor Management Led to the Meltdown of HealthCare.gov.”