Federal audit faults California exchange for lax enrollment practices

Federal auditors found that California’s health insurance exchange was lax at times in verifying consumers’ eligibility for Obamacare coverage. The report issued by the Inspector General’s Office at the U.S. Department of Health and Human Services also cited the federally-run exchange and Connecticut’s insurance marketplace for similar deficiencies.

  • “The California marketplace’s process for verifying citizenship was incomplete,” federal auditors said in the report. California, in particular, fell short on verifying citizenship, resolving inconsistencies on eligibility, entering paper applications correctly and maintaining enrollee data, according to the report.

Auditors said lax internal controls may have limited the exchanges’ “ability to prevent the use of inaccurate or fraudulent information when determining eligibility of applicants for enrollment.”

  • The audit knocked Covered California for not verifying the citizenship of seven applicants through the Department of Homeland Security when Social Security information indicated they weren’t eligible or data was lacking.

During open enrollment, Covered California often needed to resolve inconsistencies on customer applications and get further documentation.

The audit found that in 19 of 25 applications it reviewed, Covered California didn’t resolve those discrepancies.

The federal review only covered the first three months of open enrollment, from October to December, and focused on a sample of 45 applicants in California.

The Covered California exchange agreed with some of the criticisms and disputed others in a response to the audit.

Covered California told auditors it “did not have the resources to resolve all inconsistencies as required” and in some cases reviews weren’t being completed within the normal 90-day period.

In a May 29 letter to federal auditors, Covered California’s executive director, Peter Lee, noted that the findings are based on a very small sample compared to the 1.4 million people who signed up in the state through mid-April.

“This sample was taken very early in the first open enrollment period and improvements have been ongoing to ensure program integrity,” Lee wrote. “Systems and processes have been and continue to be refined and improved.”

The exchange also said its efforts were hampered by the federal data hub frequently being offline in the fall.

*Modified from a latimes.com article

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