Nearly all inconsistencies for those who enrolled for healthcare through the Affordable Care Act’s federal exchanges were unable to be resolved due to Centers for Medicare and Medicaid Services systems not being fully operational.

A new report from the Department of Health and Human Services Office of the Inspector General, officially released Wednesday but dated June 2014, finds that on the state-based marketplaces, consistency results varied while in the federal marketplaces, 2.6 million of 2.9 million, or 89%, of inconsistencies went unresolved. The field research on which the report is based was conducted between October and December 2013.

The inconsistencies most commonly included information on citizenship (44% of all inconsistencies) and income (33%). Some applicants had multiple inconsistencies, according to the data.

However, the report notes that incorrect information does not necessarily indicate an applicant provided inaccurate information or is inappropriately enrolled in a qualified health plan or receiving financial assistance through insurance affordability programs inappropriately.

Applicant information is self-submitted and applicants must meet certain requirements to be eligible to select a health plan, including being a United States citizen or national, not being incarcerated, and meeting applicable residency programs. To be eligible for an affordability program, the applicant must meet requirements related to household income, not be eligible for other minimum essential coverage and provide self-attested information on family size.

Information is typically verified through a federal data hub, where information from multiple federal agencies is sent and received. However, sometimes the information cannot be verified, resulting in an inconsistency, the report says.

On July 5, 2013, the Obama administration said it was abandoning the verification process, opting instead for an “honor system.”

“Sadly, the most consistent part of the health law’s implementation has been the millions of inconsistencies without a system in place to address them,” says House Energy and Commerce Committee Chairman Rep. Fred Upton (R-Mich.). “Vital portions of the exchanges still sit incomplete, generating serious questions about the system’s ability to process inconsistencies or handle next year’s open enrollment period. The reports underscore the perils of the administration’s incompetence, the reckless rollout, and the systemic disregard for taxpayer dollars.”

Upton’s committee further found that as of May 27, 2014 more than 4 million inconsistencies existed.

"It's not news that healthcare.gov had tech and data issues at the outset, but we’ve come a long way since then," says CMS Spokeswoman Alicia Hartinger. "CMS is working expeditiously to resolve inconsistencies to make sure individuals and families get the tax credits and coverage they deserve and that no one receives a benefit they shouldn't.  We are actively reaching out to consumers to provide additional information that supports their application for coverage and verifying their information every day."

The agency says that any consumer with an inconsistency has been contacted via postal mail twice, e-mail and phone with more outreach planned.

Unresolved Questions

“Without the ability to resolve inconsistencies in an applicant’s eligibility data, the marketplace cannot ensure that an applicant meets each of the eligibility requirements,” the report says. It adds that CMS will verify applicant’s information once the eligibility system is operational, but does not give a timeline and recommends that CMS develop and make public a plan on how and by what date the federal marketplace will resolve inconsistencies.

The inspector general notes that CMS concurred with the recommendation. Since the draft report, CMS says the marketplace has an interim annual process in place to resolve issues related to citizenship and immigration status, income and employer-sponsored minimum essential coverage. CMS plans to replace this manual process with an automated system later this summer.

CMS further states that former HHS Secretary Kathleen Sebelius outlined in January 2014 the additional time to verify consumers' information in a letter to Congress and "as such the information in this report is out of date."

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