Networks Skip Report Feds Unable to Verify $2.8 Billion in ObamaCare Subsidies

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By Curtis Houck | June 16, 2015 | 9:13 PM EDT

The top English and Spanish networks refused on Tuesday evening to cover the findings of a federal audit report from the Department of Health and Human Services (HHS) Office of Inspector General (OIG) that concluded that just under $3 billion in ObamaCare subsidies have been unable to be properly verified that, according to the audit, puts taxpayer funding “at risk.”

While English-language networks ABC, CBS, and NBC partnered with Spanish-language networks MundoFox, Telemundo and Univision to ignore this story, the Fox News Channel (FNC) program Special Report devoted a one-minute-and-48-second segment to the IG’s findings.

Fill-in anchor Doug McKelway pointed out that the report comes as “we await a Supreme Court decision that could have a huge impact on ObamaCare” and revealed “just how much confusion the President’s health care law is causing with book keepers.”

In a live shot from the White House, correspondent Kevin Corke explained that the 39-page report contained “a number of recommendations about how to deal with a potential accounting gap between what the administration has been paying insurers under ObamaCare and what it may ultimately end up owing.”

Corke detailed how “[t]he problem actually lies in the healthcare.gov web site and its unfinished back end” where insurers are supposed to “communicate enrollee information with [the] federal government,” but have not been fully able to do so to the tune of “almost $2.8 billion in subsidies or tax credits to insurers in just the first four months of 2014.”

Here’s more from the Washington Free Beacon’s (and MRC alum) Elizabeth Harrington:

The Department of Health and Human Services (HHS) Office of Inspector General (OIG) released an audit Tuesday finding that the agency did not have an internal system to ensure that subsidies went to the right enrollees, or in the correct amounts.

“[The Centers for Medicare and Medicaid Services] CMS’s internal controls did not effectively ensure the accuracy of nearly $2.8 billion in aggregate financial assistance payments made to insurance companies under the Affordable Care Act during the first four months that these payments were made,” the OIG said.

“CMS’s system of internal controls could not ensure that CMS made correct financial assistance payments,” they said.

The OIG reviewed subsidies paid to insurance companies between January and April 2014. The audit found that CMS did not have a process to “prevent or detect any possible substantial errors” in subsidy payments.

The OIG said the agency did not have a system to “ensure that financial assistance payments were made on behalf of confirmed enrollees and in the correct amounts.”

Instead of covering this troubling development, ABC’s World News Tonight devoted one minute and 16 seconds over the course a tease and full report previewing game six of the NBA Finals and showing video of Cleveland Cavaliers star LeBron James when he was 16 years old.

DOUG MCKELWAY: As we await a Supreme Court decision that could have a huge impact on ObamaCare, new information on just how much confusion the President’s health care law is causing with book keepers. Correspondent Kevin Corke is at the White House tonight. Good evening, Kevin.

KEVIN CORKE: Hey Doug, good evening to you. The IG report, the Inspector General’s report, is 39-pages-long and in it are a number of recommendations about how to deal with a potential accounting gap between what the administration has been paying insurers under ObamaCare and what it may ultimately end up owing. Now, here’s how it works. The problem actually lies in the healthcare.gov web site and its unfinished back end. That’s the part of the website that allows insurers to communicate enrollee information with federal government, you know, offices, but the problem is it simply hasn’t been completed and so, that means we don’t know how bad is. I mean, the fact is it was even worse back when ObamaCare rolled out back in 2014 and just to give you an idea of the scope we’re dealing with here, the IG reported that the government doled out almost $2.8 billion in subsidies or tax credits to insurers in just the first four months of 2014, back when ObamaCare launched.

WHITE HOUSE PRESS SECRETARY JOSH EARNEST: The administration takes very seriously the mandate that we have to both be good stewards of taxpayer dollars but also make sure that those citizens across the country who qualified for subsidies that make their health care more affordable, that they get that tax credit.

CORKE: Meanwhile, the HHS is also weighing in on this. Communications Director Megan Smith saying, quote, “we are committed to continuing to improve our processes and will work with the inspector general to implement their recommendations.” Now, we are also told tonight, Doug, that the site review is ongoing and as for that back end fix? They say it is in the works. Back to you.

MCKELWAY: Kevin Corke on the North Lawn. Thank you, Kevin.

– See more at: http://newsbusters.org/blogs/curtis-houck/2015/06/16/networks-skip-report-feds-unable-verify-28-billion-obamacare-subsidies#sthash.tVCGMmep.dpuf

Obama Admin Making Billions In Obamacare Subsidy Payments Without Verifying Amounts

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SARAH HURTUBISE

Reporter

The Obama administration is making billions in payments to health insurers under Obamacare without calculating the exact amount companies are owed, according to a federal audit released Tuesday.

Obamacare’s premium subsidies are paid each month directly to insurance companies, to ease the burden of health coverage to eligible customers in the health law’s government exchanges. The payments add up: the federal government doled out almost $2.8 billion to insurers in just the first four months of 2014, when Obamacare launched.

The agency tasked with making the payments hasn’t yet made sure the calculations behind the billions are accurate. An inspector general audit of the Centers for Medicare and Medicaid Services has found that the administration did not confirm the exact amount it owed each insurer before paying up, putting the billions in federal taxpayer funds at risk.

The problem lies in HealthCare.gov’s unfinished back-end system. The portions of the website which allow insurers to communicate enrollee information with the federal government hasn’t yet been completed and was even less workable in 2014, when the outlays began.

“Because CMS has not developed the systems to obtain enrollment and payment information on an enrollee-by-enrollee basis, CMS cannot verify the accuracy of the nearly $2.8 billion it authorized for financial assistance payments during our audit period,” the Health and Human Services inspector general report concluded. “Without effective internal controls…a significant amount of Federal funds are at risk.”

That means sensitive information about the customers who are receiving the subsidies wasn’t up to date before CMS began to make the payments. Insurers instead estimated claims to the federal government, without exact data on the number of exchange enrollees and whether those customers were up-to-date on paying their portion of the premiums themselves.

The administration has said that HealthCare.gov’s back-end system went through a reboot before the start of the second open enrollment period, but still isn’t complete. Federal officials don’t expect the system to be fully finished until the end of 2015, according to The Wall Street Journal, potentially putting taxpayer dollars at risk for two years of Obamacare’s operation.

The audit examined only the first four months of 2014. The Congressional Budget Office estimates that federal spending on Obamacare subsidies will reach $726 billion between 2015 and 2024.

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Premium subsidies are paid in advance to insurers as a form of tax credit for customers. Even once insurers are able to submit current customer information to the federal government, the accuracy of each customer’s subsidy is only verified once individual enrollees file tax returns each April. (RELATED: Obamacare ‘Clawback’ To Hit Some Subsidy Recipients With Huge Tax Bill) 

CMS acting administrator Andy Slavitt said in a response to the audit that a series internal reviews was used to monitor accuracy and that the agency “takes the stewardship of tax dollars seriously.”

Read more: http://dailycaller.com/2015/06/16/obama-admin-making-billions-in-obamacare-subsidy-payments-without-verifying-amounts/#ixzz3dG58FQZY

Obamacare Co-ops Use Tax Dollars To Lobby For More Tax Dollars

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RICHARD POLLOCK

Health Republic Insurance of New York paid K Street lobbyists to help it secure $90 million in federal “solvency funds,” allowing the Obamacare health insurance co-op to stay afloat last year, according to congressional lobbying disclosure records.

Quarterly documents obtained from the clerk of the United States Senate by the Daily Caller News Foundation’s Investigative Group show Health Republic paid $180,000 to the lobbying firm of Alston & Bird. The payments were made from early 2014 through the first quarter of this year.

Alston & Bird did not merely lobby Congress, according to the documents.  They also lobbied federal officials at the Center for Medicare and Medicaid Services, which manages Obamacare.

Health Republic last year asked CMS to provide an additional $90 million in “solvency funds” to the co-op.  CMS officials approved the request last September, five months after Alston & Bird began their lobbying of agency officials.

Health Republic originally received $265 million in start-up funding in 2012, making it the largest of two dozen health insurance co-ops established under an Obamacare program designed to provide publicly funded competition for private sector health insurance firms. Healthcare reform advocates said the co-ops would offer lower premiums for comparable coverage.

Obamacare health insurance co-ops in Colorado and Michigan also retained lobbyists to influence Congress and executive branch officials, according to Senate documents.

Heading up Health Republic’s Washington lobbying is former U.S. Rep. Earl Pomeroy, a nine-term North Dakota Democrat, who manages the K Street firm’s health care lobby shop.

Bob Siggins, a former long-time congressional staff aide for the congressman and once his chief-of-staff followed Pomeroy to join Alston & Bird.  Siggins also lobbies for Health Republic, according to the documents.IR

Pomeroy claimed his lobbying on behalf of the federally funded co-op was “completely appropriate” and that the lobbying firm continues the work on the co-op’s behalf.

Federal law forbids a recipient of federal funds “to pay any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any federal action.”

CMS stated in its Dec, 13, 2011, final rule governing the co-ops that “no portion of the loans be used for propaganda purposes, attempts to influence legislation, or marketing.”

Federal rules also direct all co-ops to “to use any profits to lower premiums, improve benefits, or for other programs intended to improve the quality of health care delivered to its members.”

Obamacare co-ops like Health Republic rely almost exclusively on tax dollars.  The CMS awarded $2 billion to 24 proposed co-ops in 2012. The money was to be used for start-up costs and insurance capitalization.

Health Republic has filed its tax returns as a 501(c)(6) tax-exempt business league organization, but it and the other Obamacare co-ops also conform to the 501(c)(29) designation established specifically for them. Health Republic filed as a (c)(29) in 2011, but the IRS regulations for the (29) designation – which bar the co-ops from lobbying Congress – weren’t finalized until this year.

The (c)(6) designation permits lobbying, but the funds used for that purpose are not tax-deductible and may be subject to a special tax on the organization.

“If they rely 100% on federal taxpayer dollars, they are prohibited from using those funds to lobby agencies or members of Congress,” said Scott Amey, general counsel of the Project on Government Oversight, a non-profit government watchdog. “Lobbying cannot be paid for with taxpayer dollars.”

Aaron Albright, director of communications at CMS did not respond to repeated DCNF questions about the co-op lobbying.

The National Alliance of State Health CO-OPs, the Obamacare creation’s trade association, also did not respond to DCNF questions about the legality of co-op lobbying.

Many of the Obamacare co-ops have compiled less-than-stellar records, as was predicted by the White House Office of Management and Budget, which projected in 2010 that nearly half of the groups would fail.

The insurance commissioner in Vermont refused to license the Obamacare co-op there in 2013. And the Iowa-Nebraska co-op was dissolved under state receivership early this year.

Health Republic, however, claimed to be among the most successful Obamacare co-ops, capturing one-third of New York’s Obamacare exchange customers.

The co-op was founded by Sara Horowitz, a well-known liberal New York political activist who once worked with then-state senator Barack Obama at a New York think tank partly funded by billionaire George Soros.

Horowitz also was the only individual approved by CMS to launch Obamacare co-ops in three separate states. Her groups received $434 million from CMS to launch co-ops in New York, New Jersey and Oregon.

Despite the substantial federal funding, Health Republic executives discovered last year that they did not have enough capital on hand to meet New York’s capital reserve requirements.

Alston & Bird’s disclosure forms describe the firm’s lobbying of Congress and CMS on behalf of Health Republic for the solvency funds.

According to CMS officials, a request for solvency funds represents a co-op’s attempt to meet “state determined reserve requirements.”

If a co-op’s capital reserves are being depleted too quickly or fall rapidly to unacceptable levels set by insurance regulators, there may be a need for the additional funds.

It is unclear what went wrong at Health Republic last year.  However, Horowitz ran another non-profit health insurance company in New York called Freelancers Insurance, which she closed in 2014.

The New York Department of Financial Services ranked Freelancers among the poorest insurers in the state, placing 31st among 34 insurers in the number of complaints received by state officials in 2013, it’s last full year in operation. Freelancers also had the highest reversal rate for grievances filed by doctors, hospitals and other medical providers.

Thomas Miller, a health expert and resident fellow at the American Enterprise Institute said Health Republic’s decision to hire a high-priced lobbying firm indicates “they were pulling out all of the stops.”

The request for solvency funds is “a warning sign not only that they’re having trouble right now but it’s a preview of what would be a continuing chronic future.”  He said, “they’re simply throwing more good money after bad.”

Consumer Mutual Insurance of Michigan reported paying $13,000 in lobbying fees to MJ Capitol Consulting.  The Michigan co-op received $71 million in CMS funding and also sought solvency funding but did not get it.

The Colorado Health Insurance Cooperative received $72 million from CMS and paid $20,000 this year to Thorn Run Partners for unspecified lobbying on “issues relating to CO-OPs.”

Spokesmen for the Colorado and Michigan co-ops did not respond to DCNF calls.

Skyrocketing Medicaid signups stir Obamacare fights

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Some GOP governors are saying: “I told you so.”

BY RACHANA PRADHAN

Medicaid enrollment under Obamacare is skyrocketing past expectations, giving some GOP governors who oppose the program’s expansion under the health law an “I told you so” moment.

More than 12 million people have signed up for Medicaid under the Affordable Care Act since January 2014, and in some states that embraced that piece of the law, enrollment is hundreds of thousands beyond initial projections. Seven states have seen particularly big surges, with their overruns totaling nearly 1.4 million low-income adults.

The federal government is picking up 100 percent of the expansion costs through 2016, and then will gradually cut back to 90 percent. But some conservatives say the costs that will fall on the states are just too big a burden, and they see vindication in the signup numbers, proof that costs will be more than projected as they have warned all along.

Obamacare originally expanded Medicaid — which traditionally served poor children, pregnant women and the disabled — to all childless low-income adults with incomes up to 138 percent of the federal poverty level (about $16,250 for an individual) across the country. But the Supreme Court made expansion optional in 2012. And 21 states, mostly with GOP governors, have resisted.

“The expansion of Obamacare will cost our state taxpayers $5 billion,” Florida Gov. Rick Scott said in an interview with POLITICO last week, referring to the 10-year cost. “Name the health care program — I think the only one is Medicare Part D — that cost less than what they initially anticipated…Historically, if you look at the numbers, with the growth in Medicare costs, Medicaid costs, it’s always multiples.” A bitter critic of Obamacare, Scott at one point surprisingly backed expansion, but withdrew his support earlier this year. His state legislature is deeply split on Medicaid policy.

In some states that did expand, the take-up has been startling — the result, officials say, of significant pent-up demand for coverage. In Illinois, nearly 541,000 people had signed up as of December, far beyond the 199,000 adults the state had estimated would enroll in 2014. The numbers increased to nearly 634,000 as of April.

In Washington, 535,000 people had signed up as of March — already beating the state’s January 2018 goal. Officials’ projection for March had been just 190,365 newly eligible enrollees.

In Michigan, where the first-year enrollment projection was 323,000 people, sign-ups hit 605,000 before falling back to 582,000 earlier this month. Kentucky signed up nearly 311,000 new adults by the end of its 2014 fiscal year, more than double its initial projection of 148,000. And in February 2014, Minnesota forecast that 147,000 newly eligible adults would enroll by December, but actual enrollment that month was at nearly 194,000.

Supporters of Obamacare say the enrollment surge might lead to some budget bumps down the road, but that the historic decline in the uninsured is a major achievement. In addition, they say the expansion is providing significant health and economic benefits to states that more than offset costs.

States — and hospitals and doctors — are getting billions of dollars from the federal government to cover low-income people, letting them save money on other programs that had been fully or partly funded through state dollars.

“Can we afford not to do this?” asked Audrey Haynes, secretary of Kentucky’s Cabinet for Health and Family Services under Democratic Gov. Steve Beshear. Kentucky under Beshear has fully implemented Obamacare, and it’s seen the second largest decline in its uninsured rate, after Arkansas.

But the money remains a concern not just for foes of expansion like Scott, but for GOP governors like Utah’s Gary Herbert who are trying to come up with some way for their states to expand. Herbert met with HHS Secretary Sylvia Mathews Burwell in late April and later voiced worries that any form of expansion could mean Medicaid consumes an even bigger chunk of the state budget starting in 2017.

“We’re trying to cover as many people as we can afford,” said Herbert, a Republican who supports expansion but has not yet managed to find the right mix of ACA expansion and conservative variants to bring his legislature on board. “Is it 90,000 or 110,000 people? I don’t know what that’s going to work out to be right now.”

The enrollment surge underscores those fiscal fears.

“If you’re spending twice as much on this program than expected, that’s twice as much money that’s being added to the national debt,” said Nicholas Horton with the Foundation for Government Accountability, a conservative think tank that has sought to highlight how much expansion enrollment has gone beyond expectations. Even if the states don’t pay nearly as much as the federal government for Medicaid expansion, he said, “You’re still going to spend more money overall. That’s still taxpayer money.”

Colorado has repeatedly revised its average enrollment estimates to account for increases. Early on, officials had projected that for the fiscal year ending June 30, about 144,000 new adults would be covered in any given month. In November, they bumped the number to nearly 205,000. It currently stands at about 234,000.

Beyond the low-income adults that became newly eligible for Medicaid because of the health care law, states have long feared the budget impacts of the “woodwork effect” — people previously eligible for Medicaid who are only enrolling now because of the broader outreach surrounding Obamacare. Generally, even the states that have shunned Obamacare Medicaid expansion are seeing enrollment growth. The federal government does not cover as much of traditional Medicaid costs; on average, the feds’ share is 57 percent and the states pay the rest.

That “woodwork” phenomenon could create budget concerns for states if enrollment is significantly higher than projections, acknowledged Matt Salo, executive director of the National Association of Medicaid Directors. But even that outcome, he stressed, “still solves a health care problem.” These people are now insured, and that could lead to less cost-shifting and crisis care that was also a fiscal strain on states.

And for states that expanded under the ACA, he said, “you don’t do an expansion and hope no one comes.”

“Everything’s got to make sense in a budgetary environment,” Salo said. “But you balance that with, isn’t this what you were trying to accomplish?”

In California, a spokesperson for the Department of Health Care Services said enrollment for new low-income adults has been on par with projections, but as of March enrollment of those previously eligible for Medicaid was about 200,000 people higher than expected. Kentucky similarly had expected about 17,000 of the previously-eligible population to sign up, but enrolled nearly 37,000.

But Haynes points to a Deloitte report that shows the substantial economic benefits Kentucky has gained from expanding Medicaid. In 2014, 12,000 jobs were created, the report said. And had the state not expanded, it would have incurred nearly $100 million in costs between 2014 and 2021.

Some state officials say that even though enrollment ballooned in the first year, the trend may be leveling off. Michigan says while enrollment to date has exceeded estimates, the numbers have started to decline as it begins annual redeterminations to make sure beneficiaries are still eligible for coverage.

In Ohio, where John Kasich was among the first GOP governors to embrace the ACA expansion, officials expected 366,000 people to enroll in the first year; more than 485,000 did. The numbers as of March stood at nearly 528,000.

Ohio Medicaid spokesman Sam Rossi says in spite of the higher expansion enrollment, overall Medicaid enrollment remains below projections by roughly 27,000 people because the state hasn’t seen as much “woodwork effect” as it anticipated. He adds that total Medicaid general revenue spending as of March was below estimates by $330 million.

Nathan Johnson, the chief policy officer for Washington state’s Health Care Authority, said that in some ways the booming Medicaid enrollment growth isn’t surprising. But the exact reasons as to why projections were so off have yet to be identified.

“We still assume that it’ll more than break even in terms of the financial component, even after higher than expected enrollment,” he said. A recent report funded by the Robert Wood Johnson Foundation seeks to quantify the state’s savings from expansion, but it assumes Washington will only have 480,000 newly eligible enrollees in the current fiscal year — a figure that has already been exceeded.

Haynes, of Kentucky, has strong words for the states that are shying away from enacting the Obamacare coverage expansion. Every state is tight on money, and people who say they can’t give health care to the poorest individuals either don’t understand the issue or it’s “political fodder.”

“It is usually a political decision, not a policy and economic decision,” she adds. “[Expansion foes] can make up whatever they want, to dispute those facts. But it’s made up. These are the facts.”

Read more: http://www.politico.com/story/2015/05/skyrocketing-medicaid-expansion-obamacare-republican-governors-118011.html#ixzz3aXB0gd7U

FEDS COLLECT RECORD $472 BILLION IN TAXES IN JUST ONE MONTH …

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By Stephen Dinan – The Washington Times – Thursday, May 7, 2015

The federal government set a record tax haul in April, taking in nearly a half-trillion dollars in one month alone, according to Congressional Budget Office statistics released Thursday.

April is always a busy month with the tax deadline on April 15, but this year’s haul was historic, totaling $472 billion, far outstripping the previous monthly record, set last April, of $414 billion.

Spending, meanwhile, was a more modest $317 billion, leaving the government with a surplus for that one month of $155 billion — also a record.

Despite that good month, the government is likely to run a deficit when the entire fiscal year is taken into account. But it will probably be smaller than last year’s deficit, and will be the lowest since President Obama took office.

The good news surprised the budget counters at the CBO.

“Receipts for the first seven months of fiscal year 2015 totaled $1,892 billion, CBO estimates — $155 billion more than receipts in the same period last year. That increase is roughly $40 billion larger than what CBO expected when it published its March 2015 report,” the nonpartisan agency said in its report.

Both taxes and spending are growing rapidly, at 9 percent and 7 percent, respectively.

The CBO said the biggest spending increases are in Medicare, Medicaid and Social Security — the big entitlement programs that are essentially on autopilot, with costs increasing as more poor, disabled and elderly people become eligible. Combined, they are up some $81 billion compared to the same time period from fiscal 2014.

Defense spending is down, dropping by nearly 4 percent.

Read more: http://www.washingtontimes.com/news/2015/may/7/feds-set-tax-haul-record-472-billion-one-month/#ixzz3ZU8nWvSR

Follow us: @washtimes on Twitter

The Odd Connection between Obamacare and Foodstamps

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BY MICHAEL MINKOFF

Ever since Obamacare has been implemented, food stamp usage has increased, seemingly disconnected from the “improving” economy:

In most affected states, the enrollment increases were not huge, ranging from 1 percent to 6 percent over two years, according to an Associated Press analysis. The sole exception was Nevada, where enrollment shot up 14 percent.

The enrollment is climbing as Republicans try to cut the costs of the food program and at a time when food-stamp usage would normally be expected to decline. Eligibility rules have not changed.

West Virginia’s food-stamp enrollment increased 4 percent after a Medicaid expansion that was part of the health care changes. Enrollment jumped because people were “more engaged with our systems and more aware what they’re eligible for,” said Jeremiah Samples of the West Virginia Department of Health and Human Resources.

So Obamacare forces people to engage with the welfare system in at least one way, and some of those people are dipping into other welfare services while they’re there. Because why not?

Everyone knew Obamacare was going to be more expensive than anyone had predicted. But not even the most diehard opponent of Obamacare foresaw this. People would have said we were grasping at straws if we had predicted an up-tick in welfare enrollment correlated to Obamacare. Yet that is just what is happening.

So what’s the solution? The solution is obvious. Get the civil government out of the welfare business. They are really terrible at it. By that, I mean that they are really terrible at actually helping people. They are very adept at finding new ways to give “support” to people who would probably be better off without it in the long-term.

There probably isn’t a chance of abolishing Obamacare at this point. Everyone points to how well it’s working. No one seems to care that we can’t afford it. Well at least we’ll be able to eat some freshly minted food stamps when the economy collapses.

Read more at http://eaglerising.com/17753/the-odd-connection-between-obamacare-and-foodstamps/#w3Qf34zmPiFHcMZ2.99