Fraud concerns raised regarding the Affordable Care Act

Reported by: Terri Hendry
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Updated: 7/29/2014 9:16 pm
CARSON CITY, Nev. ( & KRNV) -- The non-partisan Government Accountability Office is raising fraud concerns. It says undercover federal agents were able to purchase taxpayer-subsidized health insurance using fake identities and false information.

The preliminary report said agents were successful in 11 out of 12 attempts.  You can read the report here.

News 4 provided Nevada officials with a copy of the report and asked if Nevada's Exchange faced similar verification problems. Nevada Health Link Spokesman C.J. Bawden acknowledged this issue has been on the radar in Nevada from the very beginning, and notes Nevada has already taken steps to make sure this potential was addressed. "Absolutely, here in Nevada we've been able to put together multiple levels to identify income and to make sure individuals are who they say they are."

Bawden said the individuals can obtain both Medicaid and health care coverage using Nevada Health Link. He said there is a very stringent process in place for Medicaid verification. "They have entire teams put in place to do audits on individuals and they have investigative units as well."

Bawden said those who apply for coverage under the Affordable Care Act must provide proof of income. "If a person ever puts an income that was less than 20% of what they made the year before, then we make them prove that income either by tax returns or pay stubs."

He also said there is process to verify identities. "If we can't verify their name or social security number, they have to provide the information within 90 days or their coverage is terminated."

Bawden said the worst case scenario in Nevada would be for someone to obtain coverage for 90 days, but in some cases, the IRS might be able to recover the subsidy.

The Silver State Exchange has had its share of problems, but Bawden said this is not among them. "This would be very low on the scale of everything that's been talked about."

On the national level, this issue was discussed in the House Ways and Means Committee. GAO Audits and Investigations Chief Seto Bagdoyan said the GAO has not drawn any sweeping conclusions and a full assessment will take several months.

Bagdoyan noted that in the real world, it may be difficult for fraud artists to profit from the Affordable Care Act, since subsidies are paid directly to insurance companies. But some Republican lawmakers said the question was one of whether the government was being a "good steward of taxpayer dollars."  

The Obama Administration is taking this report seriously. Work is underway to strengthen the verification process.
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