U.S. Officials Move to End Duplicate Health Care Coverage

The Obama administration is moving to end duplicate coverage for tens of thousands of people who are enrolled in Medicaid and simultaneously receiving federal subsidies to help pay for private health insurance under the Affordable Care Act.

In the last few days, consumers around the country have received letters warning, in big black type: “People in your household may lose financial help for their marketplace coverage.”

The unsigned letters from the federal insurance exchange tell consumers that they “should immediately end marketplace coverage with premium tax credits for each person” in the household who is also enrolled in Medicaid or in the Children’s Health Insurance Program.

If they fail to act, the administration says, it will unilaterally cut off any financial assistance they receive to help pay insurance premiums, deductibles and other out-of-pocket medical costs.

The action, supervised by Sylvia Mathews Burwell, the secretary of health and human services, comes more than nine months after congressional investigators from the Government Accountability Office said they had discovered the potential for duplicate coverage, with double payment.

The potential is significant because low-income people can switch back and forth between Medicaid and subsidized private coverage as their circumstances change.

The Affordable Care Act created the online marketplaces, where consumers can obtain subsidies for health coverage, and it expanded Medicaid to cover millions of adults without children. The Congressional Budget Office estimates that the subsidies and the expansion of Medicaid together cost about $100 billion this year.

State officials administer the Medicaid program, but federal officials run the insurance exchanges for most states. “It is often difficult for the two levels of government to exchange information in real time because they use different computer systems,” said Sara Rosenbaum, a professor of health law and policy at George Washington University.

The Obama administration identified people who were receiving both Medicaid and tax-credit subsidies by comparing records of the federal marketplace with enrollment files maintained by state Medicaid agencies. A similar exercise in the spring found 88,000 people with “dual enrollment,” but the administration did not take action against them.

Eligibility for the two programs can change because of changes in family size, household income or other factors. Information in federal and state files may, in some cases, be out of date. State agencies do not always notify the federal marketplace when they find a person eligible for Medicaid. Indeed, beneficiaries are supposed to notify the marketplace, according toHealthCare.gov.

Republicans in Congress say that in its desire to increase enrollment, the administration has been lax in verifying consumers’ eligibility for subsidies.

“Federal officials have a legal and ethical duty to be good stewards of federal dollars,” said Representative Joe Pitts, Republican of Pennsylvania and chairman of the Energy and Commerce subcommittee on health.

But Judith Solomon, a vice president at the Center on Budget and Policy Priorities, a liberal-leaning research and advocacy group, said it was not right to view consumers with Medicaid and tax credits as “double dippers.”

“In all likelihood,” she said, “they are not using both forms of coverage. People may not realize they have both and may not know how to stop the marketplace coverage. There’s really no advantage to double dipping here. It’s not like you get money in your pocket from either of these programs. They are vendor payment programs.”

Most people who obtain insurance through the exchanges also receive subsidies to help pay the premiums, and in most cases, the Treasury pays those subsidies directly to insurance companies. Many of the same companies have contracts with state Medicaid agencies to manage care for Medicaid beneficiaries, and from 2014 to 2016, the federal government pays the full cost of coverage for newly eligible beneficiaries.

Thus, the federal government may be paying twice for the same person if the person is in both Medicaid and a subsidized insurance policy bought through the marketplace.

“We really don’t want this to continue because it’s basically money going down the drain,” said Ms. Solomon, a strong supporter of the health law.

Medicaid beneficiaries generally have less income than residents of the same state who buy insurance in the marketplace. Medicaid provides many services that commercial insurers do not cover, and people usually pay less under Medicaid than they would for the same services under a subsidized private health plan.

In states that expanded eligibility, Medicaid has also been more successful than the exchanges in signing up people for insurance.

The Senate majority leader, Mitch McConnell, Republican of Kentucky, questioned the administration’s plans for a marketing campaign to promote enrollment under the Affordable Care Act this fall. In a letter to Ms. Burwell on Friday, he asked how much would be spent on the campaign and where the money would come from.

Mr. McConnell suggested in the letter that the money might be better spent combating the Zika virus than “propping up the failed Obamacare exchanges.”

Administration officials said that expanding insurance coverage and preventing the spread of Zika were both high priorities for President Obama.

Source Link