HHS, GAO Officials Testify on ACA Fraud at House Subcommittee Hearing

Officials from HHS and the Government Accountability Office (GAO) testified before a House Oversight and Government Reform subcommittee about waste, fraud, and abuse under the Affordable Care Act (ACA). Vicki Robinson, from the Office of the Inspector General (OIG) in HHS, and John Dicken, director for healthcare issues at the GAO, presented their findings as part of the larger debate surrounding the law’s potential repeal.

Representative Jim Jordan, R-Ohio, chairman of the subcommittee on Health Care, Benefits and Administrative Rules, started the hearing by listing the ACA’s shortcomings, including “soaring” insurance premiums, a lack of competition within exchanges, and unfulfilled promises by the Obama administration. Countering this grim picture was subcommittee ranking member Representative Raja Krishnamoorthi, D-Illinois, who argued that millions of Americans gained coverage and consumer protections under the ACA, and called Republican moves to repeal the law without a replacement “foolhardy and reckless.”

Nonetheless, the goal of the hearing was to understand the ACA’s impact on insurance markets and lessons from the law’s implementation as Congress debates its repeal. The first to testify was Vicki Robinson, who summarized her office’s goals as combating waste, fraud, and abuse by promoting efficiency. She said that they had found a number of vulnerabilities in federal payment controls, eligibility verification processes, and overall program management when the ACA was implemented.

For instance, Robinson testified that most states did not properly allocate funds for the establishment of exchanges, and that Marketplace plans did not always verify applicants’ identity, income, or citizenship status when determining eligibility and subsidies. They found that CMS had not sufficiently managed its contractors, which continued to the initial problems with the Healthcare.gov website rollout. She concluded that ensuring program integrity will require the “vigilance and sustained focus” that remains a priority for the OIG.

Next to testify was John Dicken, who summarized some GAO findings on how the ACA has impacted insurance markets. His office found that exchange plans were largely concentrated among a small number of issuers in many states, so that while most consumers had at least 6 plans to choose from, some areas were limited to plans from a single insurer. Insurance premiums also varied widely by state, and were set to increase by an average 25% in 2017. However, plan satisfaction levels were comparable between Marketplace enrollees and those with employer-sponsored insurance.

Finally, citizen Jonathan Siegel delivered moving testimony on how the ACA allowed him to start his own small business after being laid off without worrying that his family would be left uninsured. He voiced concerns about the potential impact of repeal on costly patients like his wife, who has multiple sclerosis, along with low-income people who would lose coverage if Medicaid expansion is rolled back.

Krishnamoorthi and committee ranking member Representative Elijah Cummings, D-Maryland, pointed to Siegel’s story as example of why Congress should “mend the ACA, not end it,” but some of the hearing’s attendees disagreed. Jordan pressed Dicken to discuss the findings of an undercover test, later outlined in a GAO report, that had 15 fictitious people apply during the open enrollment period, and Dicken confirmed that all 15 initially received subsidized coverage. The GAO has since recommended that HHS develop a fraud risk assessment, he said.

Combined with the monopolies in some insurance markets, Jordan worried that this type of fraud was driving up the ACA’s cost to taxpayers. He vowed to work with his colleagues in Congress to fulfill the promise of ACA repeal that he said voters had chosen.