ObamaCare Made My Lie..!

[Duaine]

Let me stipulate that I do not condone fraud in any form. Moreover, I assume all Weekly Standard readers are law-abiding citizens who would neither commit fraud themselves nor encourage others to do so. My purpose is to inform such readers just how tempting fraud on the Obamacare health insurance exchanges will be in light of the recently announced delays in employer reporting and employer mandates.

Obamacare creates many grossly unfair situations.
NEWSCOM

There are three types of fraud worth considering, each reflecting different motivations and degrees of risk tolerance among the hypothetical individuals considered.

The Dishonor System | The Weekly Standard

 

[Ann H]

That is a very interesting article. They detail the motivation for a person near poverty level to lie, but how about those near the 400% mark?

 

[bedlamins]

If Pete, Mike or Dan, had the intellectual horsepower to pull this kind of stunt off they wouldn't be janitors and groundskeepers. Point is well taken, however. The system is wide open to be gamed.

 

[RayNY]

bedlamins, don't underestimate the power of free money. To someone making that little amount of money, a $15,000 subsidy is like hitting the lottery, you best believe that's enough motivation to figure out how to get it.

 

[bedlamins]

I agree with that but the article was putting a lot of stock into these individuals having a very in depth knowledge of the law and its loopholes. I'm skeptical that your average groundskeeper or janitor would have that.

However, as we have seen in this country for years, many people can squeeze out a living off the government by finding every angle, cracked door, subsidy, tax credit, and otherwise.

 

[VolAgent]

I agree with that but the article was putting a lot of stock into these individuals having a very in depth knowledge of the law and its loopholes. I'm skeptical that your average groundskeeper or janitor would have that.

However, as we have seen in this country for years, many people can squeeze out a living off the government by finding every angle, cracked door, subsidy, tax credit, and otherwise.

They probably won't put as much conscious thought into it, but they will find ways to game the system. Where the article most overestimates the people who will game the system is thinking about the consequences. I doubt much thought will be given to that, just how to best game the system.

 

[Duaine]

Looking for a little extra cash? If you're interested in defrauding taxpayers, it might be as easy as writing down a number on a form.

The number is your income. The form is the Obamacare application.

If you do not have "affordable" employer-sponsored health insurance and your income is between about $31,800 and $94,200 for a family of four (that is, between 138 percent and 400 percent of the federal poverty level), you qualify for an insurance subsidy through Obamacare.

But when you apply for coverage in the Obamacare insurance exchange, it's up to you to report your income accurately. It turns out that the IRS won't be checking everyone's Obamacare applications.

Heritage health care expert Chris Jacobs ran the numbers to show what a difference a little fraud can make. He took a hypothetical family of four with $90,000 in income who were eligible for coverage through the exchange. If this family were honest, they would receive a subsidy of $2,997 to help cover their insurance premiums.

But if that same family put down $35,000 as their income instead, they would receive $10,175 from taxpayers. Even if they were caught, they would have to pay back only $2,500 of their ill-gotten subsidy, due to a loophole in Obamacare.
Will anyone be checking? It's doubtful, Jacobs writes:

Supporters of the law claim this scenario will not happen, due to the penalties associated with misrepresenting information on application forms and tax documents. But with government auditors noting the exchanges have missed critical deadlines, and Obamacare anti-fraud investigations being cancelled, will the federal government really have the resources necessary to enforce the law, much less ensure taxpayer funds are not being abused?
​

Congress should not expose taxpayers to this kind of liability. It's another reason to defund Obamacare.

 

[Ann H]

A few things to note -

The maximum clawback (which was amended in the repeal of the 1099 provision), is now the following amounts:

Less than 200% of FPL - $600
At least 200% but less than 300% of FPL - $1500
At least 300% but less than 400% of FPL - $2500

This is the amount for married taxpayers. It is half that amount for single taxpayers.

The amendment can be found here - http://www.gpo.gov/fdsys/pkg/PLAW-112publ9/pdf/PLAW-112publ9.pdf

As far as I know, there is no clawback on CSR (cost sharing reductions).

The exchange subsidy app includes a statement about willful mistatement. The IRS usually considers a mistatement of 20% or more of income to be fraudulent, and it opens a whole series of criminal charges and collection activities.

The IRS cannot go use collection methods to collect on the individual mandate penalty, but it doesn't say that for the clawback of excess subsidies.

 

[AllenChicago]

A few things to note -
.
.
The exchange subsidy app includes a statement about willful mistatement. The IRS usually considers a mistatement of 20% or more of income to be fraudulent, and it opens a whole series of criminal charges and collection activities.

The IRS cannot go use collection methods to collect on the individual mandate penalty, but it doesn't say that for the clawback of excess subsidies.

No wonder 15,000 new IRS agents were hired. The powers in charge of the ACA looked at their own personal financial decision track-record and made the determination that there will be a LOT of cheaters!

The IRS said that they decided not to enforce the penalty-tax...not that they were prohibited by law from enforcing it. But as we know, government can be against something today, and all for it tomorrow.

I hope health insurers have modified their refund software appropriately. The way it stands now, if a policy owner/payor cancels his/her plan before a certain date each month, the owner/payor gets a 100% refund of the premium. If the software isn't modified, or coded correctly, word will spread like wildfire that full refunds (which includes the govt subsidy!) are being sent to applicants who cancel before the xx of each month.


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