VectorInspiration / Getty Images
VectorInspiration / Getty Images
Some insurance brokers are enrolling people in the Affordable Care Act without consent, probably because of fees. This can put consumers at risk by paying insurance-related subsidies. The damage can be hundreds or even thousands of dollars.
Consumers’ first hint that something is wrong is big: letters from the IRS or tax refund delays.
While this practice does not appear to be widespread, the Department of Health and Human Services has begun to call for changes to some monitoring rules that affect brokers. They start in 2023.
“This is without the consumer’s knowledge,” because HHS, according to its proposal, “observed some cases where agents, brokers, and web brokers provided inaccurate consumer household income forecasts.” There is a problem in the registered situation “, so I would like to change it. Or I agree. “
This change is part of a 400-page draft rule that governs the federal health insurance market and several states that use the federal platform on their own exchanges. The new broker clause aims to prevent fraudulent applications by making it clear that applicants must prove that the income forecasts stated are correct.
It also means that brokers and services that help people register for coverage use “disposable” email addresses that disappear after a set number of days, or list the broker’s phone number on behalf of the consumer. Is forbidden.
Tara Straw, Head of Health Insurance and Market Policy, has a proposal to “tell me that there have been quite a few incidents in this regard,” and previous actions have been a problem for people to be fraudulently registered. He said it wasn’t enough to hold back. Center on budget and policy priorities.
A spokesperson for Centers for Medicare & Medicaid Services said in an email that the agency was unaware of a wide range of issues, but due to the frequency of such cases and the unprotected registration of agents or brokers. A person who refuses to provide data on how to obtain the required personal information.
Nonetheless, legal, policy and registration experts say it is a recurring issue. From a homeless shelter in North Carolina, agents allegedly registered hundreds of people in a plan by the federal government to pay full premiums using suspicious estimates (often referred to as the “Zero Premium Plan”) in 2015. Many citations starting with examples of their annual income.
Jody Ray, who oversees a Florida organization that helps people get insurance, said her employees last year had a client trying to help county health insurance get federal ACA insurance. I found out that they were, but who signed them up.
In another example, a partner organization found that agents enrolled people with work-based coverage on a subsidized ACA plan, and director of the University of South Florida program Florida Covering Kids & Families. Ray said. Such double registration is not permitted by law and may leave employees on the hook to repay the subsidy.
“It’s going to hurt consumers,” Ray said. Ray reports the results of this type of investigation to state regulators.
She emphasized that the brokers and the majority of others who support people’s registration are honest and carefully protect consumer information, but a few who do not create distrust among the general public. Said. Groups like her, often referred to as navigators and assistants, have no incentive to forge their registrations because they are not paid a fee, she said.
But agents, brokers, and web-based services do.
“The motivation for profits is very important to keep in mind why this happens,” said Straw, who said insurers pay fees even for non-premium plans.
The proposed changes indicate that government estimates indicate that at least 42% of people serviced by the federal health insurance market are likely to be eligible for the Zero Premium Plan based on their income.
This may be one of the reasons for the growing concern for consumers registered without consent. With no monthly bills, consumers have little way of knowing that they are participating in the plan.
“There are more zero-dollar premium plans available,” said Sabrina Collet, a researcher at Georgetown University’s Center for Health Insurance Reform. A malicious person could say, “Basically, you could forge your email address or phone number, or forge someone’s income and say you’re eligible for a zero-dollar plan, and that person never. do not know”.
Regulators have seen “some cases consumers have done for months” unaware that they are registered according to the proposed HHS rules. By that time, insurance companies may have been subsidized for hundreds or even thousands of dollars. This is also known as a tax credit and may require the policyholder to repay if the actual income exceeds the subsidy threshold.
Under the ACA, sliding-scale subsidies are available to help low- and middle-income earners buy insurance. Those who underestimate their annual income can repay all or part of these subsidies, but there is a limit to the amount of repayment for those in the low income range.
Consumers have some reliance. For example, if they sign up for compensation without consent, they can sue the federal exchange to retroactively revoke their compensation. However, it’s only 60 days since I discovered the fraudulent registration.
“Fixing the backend is complicated,” Straw said.
Health insurance markets and insurance companies that can lose customers due to such practices “need to be more aggressive at the front end.” For example, “If you notice 12 people with the same address or the same phone number, ask a question,” she said.
Christine Speidel, an associate professor at Villanova University Law School and director of a federal tax clinic that helps low-income taxpayers with IRS-related concerns, is better at preventing problems than solving them after the fact. I agree that you are.
“If there is a fraudulent registration and it is discovered more than a year later, it’s a defeat situation. Insurance companies are screaming and taxpayers are complaining that they may be hooked. I saw some recent incidents of this kind, but previously dealt with some that people didn’t know they were registered in the press.
Agents who violate the rules set by the federal exchange may be barred from selling insurance through it or face civil fines, formerly known as American health insurance plans. Kristine Grow, a spokesman for AHIP, an industry group, said. The state can also revoke the agent’s license.
“Insurance without consent is a scam, and health insurance companies are helping consumers protect against this type of scam,” she said.
Consumers seeking help when buying insurance say that the problem of fraudulent application is “often from an unlicensed person”, so the person selling the insurance has a license. You need to make sure that you are. A health insurance company that represents a broker.
She added that this group supports additional protection for consumers.
HHS is collecting comments on the proposed rules until January 27th.
KHN (Kaiser Health News) is a national news room that produces detailed journalism on health issues. This is an editorial independent operating program. KFF (Kaiser Family Foundation).
