The President Barack Obama administration is focused on making sure that as many people as possible sign up for Obamacare-subsidized health insurance plans, because if they do, it will be harder for for Republicans to repeal Obamacare. And the subsidies will help buy votes for Democratic candidates in the upcoming congressional elections.

They are deliberately encouraging billions of dollars of waste, fraud and abuse in order to achieve this political objective. The new final rules for subsidy eligibility read:

“For eligibility determination for insurance affordability programs that are effective before Jan. 1, 2015, … the exchange may accept the applicant’s attestation regarding enrollment in an eligible employer-sponsored plan … without further verification.”

On top of that, although the subsidies themselves are supposed to be tied to income, the administration also ruled that, for the most part, exchanges need not verify that applicants are earning the amount of money they claim. Exchanges now only have to audit a “statistically significant sample” of applicants; for everyone else, “the exchange may accept the attestation of projected annual household income without further verification.”

As the Wall Street Journal observed, “21 percent to 25 percent of Earned Income Tax Credits flow to people who aren’t eligible, according to the Treasury inspector general. The same error rate for Obamacare would amount to as much as $250 billion in improper payments in its first decade.”

You can say they will fix it in a couple of years, but it will still cost the taxpayers $50 billion in that time period. This is a price Democrats seem willing to pay to gain political advantage.

 

John Forman
Albert Lea