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Brady Opening Statement: Joint Hearing on the Verification of Income and Insurance Information Under the Affordable Care Act

June 10, 2014

Then-Speaker Nancy Pelosi famously warned Congress and the American People about the Affordable Care Act, “we have to pass the bill so that you can find out what is in it.”  Over four years later, the American people continue to learn and continue to be surprised.
Today the Health and Oversight subcommittees will hear testimony about yet another surprise.  

Today, 8 months after the start of open enrollment and well over a month after the extended open enrollment ended, the income and eligibility verification system is not completed.  

And the burden and the cost of that failure will fall on the American people.  That is simply unfair and unacceptable.
What we will hear today from our distinguished panel is troubling.  Potentially, millions of Americans are currently receiving the wrong tax credits and cost sharing subsidies, including some people that are completely ineligible to receive any at all.
As required by the Affordable Care Act, individuals who receive subsidies overpayments must repay the government.  

Americans who tried to do the right thing could be hit with unexpected tax bills from the IRS next April.  For many, this could mean thousands of dollars.
While the costs of the law’s failures fall on the individual, the blame for this mess falls squarely on the White House.  

Time after time, Republicans on this committee raised concerns with Administration witnesses sitting in those chairs – including cabinet officers and IRS commissioners – and we said the website, the Exchanges, the eligibility verification systems – none of it was ready to go.  

But the White House pushed ahead, focusing on the advertising campaign launching, instead of the steps to make the system actually work.  

As a result, according to the Washington Post, “[P]iles of unprocessed ‘proof’ documents are sitting in a federal contractor’s Kentucky office” while incorrect subsidies continue to be paid.  

Because the system isn’t ready, these inconsistencies have to be resolved manually, one by one – and there are over 1 million related to income alone.  And the contractors have not even started.
As we will hear, for the verification system to work as designed, a massive amount of reporting data is required from employers.  Data the government has never collected before.

The amount of the data is so massive that around this time last year, the White House gave up and delayed reporting requirements for 2014, after legitimate complaints from business about the costs of compliance.  

We are not here to revisit the controversy that decision set off, but it is important to understand that decision meant very plainly and very clearly that for 2014 there is not a working verification system.
In order to effectively manage the Affordable Care Act, the Administration either needs the employer reporting information or they don’t.  Why else would you impose such a high cost on employers?

The information is needed to enforce the so-called firewall that prohibits individuals with an offer of affordable employer insurance from receiving tax credits.  And yet it does not exist for 2014.
All that is left is for the American people to verify their eligibility for themselves.  They need to understand the rules around the offer of affordable health insurance.  

They need to know it is on them to notify the government if they received a raise, or had a child, or lost a loved one.  If they don’t understand this, they could be hit with a tax bill for thousands of dollars.  That is not fair.

Democrats and Republicans passed a law last October that stated very clearly that before any tax credits went out, the Secretary of HHS had to certify to Congress that the verification system was working.  Clearly, Secretary Sebelius erred in sending that certification.
It wasn’t working then, and it isn’t working today.  And the burden and cost of that failure will fall on the American people.  It isn’t fair and it isn’t right.