Income Verification for Health Care Reform Subsidies Part of Government Shutdown Deal

As part of the bipartisan agreement to re-open the federal government and raise the debt ceiling, the Department of Health and Human Services must submit two reports to Congress regarding income verification for individuals who receive government subsidies to purchase health insurance. The first report, due by January 1 of 2014, must detail “the procedures employed by [the insurance exchanges] to verify eligibility for credits and cost-sharing reductions.” The second report, due July 1, 2014, must outline how effective said procedures have been in preventing “the submission of inaccurate or fraudulent information by applicants.”

Neither of these requirements is especially outside the scope of what was required by the law previously and do not change the obligations or reporting requirements for employers. As many of our members are aware, employers with over 50 full-time employees or equivalents will be required to provide insurance to their full-time employees as of January 1, 2015, or risk paying a fine. However, subsidies will be available to individuals who meet certain income guidelines as of January 1, 2014. These income verification measures are designed to prohibit individuals from falsifying their income in order to receive a subsidy that they are not legally entitled to.

MSEC staff are available to assist members with questions about this and other aspects of health care reform. Members can also visit our Health Care Reform Learning Zone for information.