(Adds comment from White House spokesman)
By David Lawder
WASHINGTON, July 1 Online insurance marketplaces
created under President Barack Obama's signature healthcare law
are struggling to verify whether Americans who applied for
government subsidies to purchase health insurance are actually
qualified to receive them, a federal watchdog agency said on
The Department of Health and Human Services Office of the
Inspector General said in two reports that some "internal
controls" were ineffective in verifying eligibility at the
marketplaces run by the federal government, California,
Connecticut and some other states.
Applicants for subsidies must enter income data, Social
Security numbers and other information into the online systems.
The maximum household income allowed for a subsidy is four times
the federal poverty level, or about $94,200 for a family of
"The deficiencies in internal controls that we identified
may have limited the marketplaces' ability to prevent the use of
inaccurate or fraudulent information when determining
eligibility of applicants for enrollment in qualified health
plans," the inspector general said.
The reports mark the second potential setback in two days to
the 2010 healthcare law. The U.S. Supreme Court on Monday
limited its mandate to provide universal contraception coverage
The HHS inspector general's findings, dismissed by the White
House as based on 'outdated information,' prompted fresh
complaints from Republicans in Congress, whose attention in
recent weeks had been redirected to other issues in the runup to
November's mid-term elections.
"When Obamacare was passed, its chief architects told us
they would have to pass the bill to find out what was in it,"
said Senator Orrin Hatch, the top Republican on the Senate
Finance Committee. "Today's report confirms what we knew was not
included: safeguards to protect hard-earned taxpayer dollars
from an incompetent bureaucracy."
The California marketplace had difficulties verifying
citizenship and lawful presence, while the federal marketplace
had difficulty verifying Social Security numbers, the inspector
A companion report found that the federal and some state
insurance marketplaces could not, in their early months of
operation, resolve most inconsistencies between applicants'
self-supplied information and data received through other
federal sources, most commonly citizenship and income levels.
The federal marketplace was unable to resolve 2.6 million of
2.9 million inconsistencies as of the first quarter of 2014,
because of systems not fully operational from October through
December last year.
White House Press Secretary Josh Earnest dismissed the
inspector general reports as being based largely on "outdated
information" from late 2013, when the Obamacare website was
struggling to function properly.
He said more work needs to be done to resolve
inconsistencies, such as slight variations on a person's name
between federal databases, but these do not necessarily indicate
problems with applications that have been submitted.
"We are confident the vast majority of these inconsistencies
will be reconciled," Earnest said.
On Monday, the Supreme Court ruled 5-4 that owners of
private companies can object on religious grounds to an
Affordable Care Act provision that requires them to provide
insurance covering certain kinds of birth control for women.
(Reporting by David Lawder, with; additional reporting by Jeff
Mason; Editing by Gunna Dickson)