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ObamaCare on the honor system

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ObamaCare includes subsidies for those who are not offered what the commissars deem “affordable” coverage by their employers.  But if the employer mandate – and all of its associated reporting functions – are delayed until the Democrats managed to slither through the 2014 midterm elections, how is eligibility for those subsidies going to be computed?

The answer, quietly buried deep inside the Federal Register by this shockingly dishonest and inept Administration on Friday: the honor system.  Courtesy of Avik Roy at Forbes, I give you Fraud-a-Palooza 2014, in which the supposedly brilliant centrally-planned top-down health insurance system imposed upon us by our betters will simply take people’s word for whether they’re eligible for subsidies or not:

“We have concluded that the…proposed rule is not feasible for implementation for the first year of operations,” say the Centers for Medicare and Medicaid Services. “The exchange may accept the applicant’s attestation regarding enrollment in an eligible employer-sponsored plan…without further verification, instead of following the procedure in §155.320(d)(3)(iii).”

And it’s not just there. The feds will also allow people to gain means-tested subsidized coverage on the exchanges without having to…test their means. “For income verification, for the first year of operations, we are providing Exchanges with temporarily expanded discretion to accept an attestation of projected annual household income without further verification.”

Presumably, since the IRS knows your income, it could claw back these excess subsidies afterwards, if it chooses to. But the IRS’ record of impartiality is, shall we say, contested.

Just imagine how vigorously the IRS’ impartiality would be contested if they tried to “claw back” millions of dollars in subsidies from low-income people.  Wait until the first group of politically-attractive citizens begins complaining that their application for subsidy was denied for some nefarious reason. 

This all reminds me of the so-called “Obamaphone,” which was also running on the honor system until last year, when auditors discovered hundreds of millions of dollars in fraud.  ObamaCare will make that look like chump change.


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