The Centers for Medicare and Medicaid Services responded to doubts over whether health insurance exchanges (now formally referred to as “marketplaces”) would verify incomes consumers applying for health-insurance subsidies, which come in the form of: (1) advances on tax credits for premiums; and (2) reduced cost-sharing.
Marketplaces will always use data from tax filings and Social Security data to verify household income information provided on an application, and in many cases, will also use current wage information that is available electronically.” [Unnumbered document dated Aug. 5, 2013.]
The agency caught heat after announcing in a final rule that state marketplaces could allow applicants to self-attest their revenue levels (apparently leaving the door wide open to fraudulent applications), but the government hastened to say this circumstance would arise rarely. For it to happen, the application filer would have to project income that is 10 percent below the applicant’s tax return and Social Security data . Then data from credit watchdog Equifax would be requested, and the individual would be asked provide a reasonable explanation for the discrepancy. Only if Equifax data was unavailable, and the individual failed to provide an explanation, would the exchange have an option of granting coverage without additional documentation, CMS’ Center for Consumer Information and Insurance Oversight wrote.
This dispensation applies only to the 16 states and the District of Columbia that have no federal involvement in running an exchange. In the other 34 states with a federal presence, exchanges will require full income verification, because, CCIIO said, there are sufficient resources to do so. The regulatory relief is for 2014 only, and federal anti-fraud laws remain in effect, CCIIO asserted.