WASHINGTON (CN) – At a partisan slug fest Tuesday over the federal health care law, House Republicans blasted waste, fraud and abuse, while Democrats focused on the human cost of repealing the Patient Protection and Affordable Care Act without a replacement.
The hearing came just days after Mike DeBonis of the Washington Post obtained secret recordings from a GOP retreat in Philadelphia, revealing that the party is wrestling internally with pressure to replace Obamacare.
Rep. Tom MacArthur, R-N.J., can be heard in the recordings as warning that repealing the law too quickly would “pull the rug out from under” 20 million Americans. Rep. Pete Sessions of Texas meanwhile worried that middle-class families would not be able to afford to pay premiums under a replacement plan that utilizes tax credits.
Repealing so-called Obamacare has become a cornerstone of the Republican platform, and party loyalists in the House Oversight and Government Reform subcommittee wasted no time Tuesday afternoon attacking its flaws.
Recent reports by the inspector general have identified problems with payment controls, assuring accurate eligibility for plan applicants and a need for improved management, according to testimony by Vicki Robinson with the Department of Health and Human Services.
Robinson told the Subcommittee on Health Care, Benefits and Administrative Rules that the Centers for Medicare and Medicaid Services lacked controls to correctly calculate financial assistance payments, and lacked a mechanism to ensure that only enrollees who paid their premiums received tax credits.
She noted that states also misspent establishment grants meant to establish health insurance exchanges.
“Generally, states allocated more costs to the establishment grant than they should have under federal grant rules,” Robinson’s written testimony says. “For example, one state misallocated $28.4 million in costs to the establishment grant.”
The inspector general also found that CMS did not always verify Social Security numbers, citizenship and household income when determining eligibility for financial assistance.
“These deficiencies may have limited the Federal marketplace’s ability to prevent inaccurate or fraudulent information from being used to determine eligibility of applicants,” Robinson’s testimony says.
Rep. Jim Jordan, an Ohio Republican who chairs the subcommittee, zeroed in on a 2016 study by the Government Accountability Office, which found health insurance marketplaces are vulnerable to fraud. John Dicken with the GAO told Jordan during an exchange about an undercover experiment where marketplaces initially approved coverage and financial assistance for 15 fictitious applicants.
“Wow, so they’re batting 1,000 and ripping off the taxpayer,” Jordan said.
Dicken also noted, however, that Obamacare plans have a 70-80 percent satisfaction level among enrollees.
“To varying degrees, QHP enrollees expressed satisfaction with specific aspects of their plan,” the witness’s written testimony says, using the abbreviation for qualified health plan.
Coverage, choice of providers and plan affordability are the aspects members like most.
Flawed as the health care law might be, Rep. Raja Krishnamoorthi, D-Calif., cited a Jan. 5 Commonwealth Fund study in saying its repeal could hit the economy hard.
Repeal could result “in a $140 billion loss in federal funding for health care in 2019, leading to the loss of 2.6 million jobs (mostly in the private sector) that year across all states,” the study states (parentheses in original).
“A third of lost jobs are in health care, with the majority in other industries,” the study continues. “If replacement policies are not in place, there will be a cumulative $1.5 trillion loss in gross state products and a $2.6 trillion reduction in business output from 2019 to 2023. States and health care providers will be particularly hard hit by the funding cuts.”
Repeal could also hit entrepreneurs.
Jonathan Siegal is one such individual. The subcommittee invited Siegal, a private citizen, to share his entrepreneurial-success story, which he credits to the Affordable Care Act.
Siegal lost his job in 2012 but said he received a “decent severance package” that enabled him to purchase health insurance for his family at $2,000 a month through COBRA, short for Consolidated Omnibus Budget Reconciliation Act.
With the Affordable Care Act set to take effect in 2014 after his COBRA coverage ran out, the New Yorker said he had peace of mind when he took a former colleague up on an offer to co-found a small market-research firm.
Siegal testified that he would not have had the courage to start his own business without Obamacare.
His current monthly premium is about $600 less than it was with COBRA, but he said he is frightened now – mostly for his wife of 30 years who has multiple sclerosis, and his 26-year-old son.
“The ACA has thus helped me go out and start my own business, protected my wife from the potential financial burdens of MS and assured me that my children, whatever else may happen to them or to us, need not go without health insurance or health care,” Siegal’s written testimony says, abbreviating the Affordable Care Act.
“All of this is now in question because of the possible replacement of the ACA with insurance options that seem unwise, inadequate and discriminatory. I fear for my health insurance coverage, and even more for my spouse and my children.”
The medicine Siegal’s wife takes costs $30,000 per year on the open market, he told the subcommittee during the question-and-answer portion of the roughly two-hour hearing.
“The prospect of not having insurance, especially for my wife, is frightening,” he said, noting how expensive private-market insurance in New York was before Obamacare.
“If the Affordable Care Act is repealed, I’m not sure how I would get insurance, and if I could get it for my wife,” he said.
“I have not slept very well since the election, to be honest with you.”