HHS Scales Back ACA’s Health Insurance Income Verification Process

Last week, HHS in a final rule said it will roll back requirements for state and federal health insurance exchanges to verify the income and insurance status of people applying for coverage, Reuters reports.

Background

Under the Affordable Care Act, individuals with annual incomes ranging between 100% and 400% of the federal poverty level who do not have access to affordable coverage through their employer are eligible for subsidized coverage through the exchanges. Prior to the final rule, exchanges were expected to verify applicants' income status and conduct random checks to determine their access to employer-sponsored coverage.

Final Rule Details

Under the final regulation, federally operated exchanges still will verify such information beginning in 2014, but states operating their own exchanges can wait until 2015 to do so (Morgan, Reuters, 7/7). In addition, exchanges will only have to audit a statistically significant sample of applicants whose self-reported income differs from federal records, as opposed to reviewing all such cases. For applicants not included in the sample, "the Exchange may accept the attestation of projected annual household income without further verification," the rule states.

Individuals caught falsifying their income or insurance status on the exchange applications can face up to a $25,000 fine. Individuals who misrepresented their incomes would also have to pay back any ill-gotten subsidies via their tax returns (Kliff/Somashekhar, Washington Post, 7/5).