WASHINGTON -- Sen. Chuck Grassley of Iowa today questioned whether the federal agency in charge of implementing the Affordable Care Act appreciates the consequences of whether health care plans participating in the program are subject to key anti-fraud protections.
"I'm alarmed that the Obama administration doesn't understand the capacity for fraud in the new health care program," Grassley said. "The head of the agency in charge doesn't seem to appreciate that the billions of dollars in subsidies for individuals going to health insurers to join Obamacare are federal tax dollars. Those dollars should be subject to anti-fraud laws. Why wouldn't they be?"
At a Finance Committee hearing today, Grassley asked Health and Human Services Secretary Kathleen Sebelius to explain her letter to a House member that qualified health plans and other programs related to the federally facilitated marketplace and other programs under the Affordable Care Act are not considered federal health care programs. Grassley questioned whether that would mean Obamacare programs are not subject to federal anti-kickback statutes and the federal False Claims Act, one of the government's most effective tools against fraud, especially health care fraud in recent years.
Sebelius argued that the federal exchanges offer plans from private insurers that should not be subject to anti-fraud protections designed for taxpayer-funded federal programs. After Grassley pointed out that Medicare Advantage also offers plans from private insurers and is subject to those anti-fraud provisions, Sebelius argued that the exchanges were different from Medicare Advantage because of the direct payments from the government to the insurers. However, after the hearing, Grassley questioned whether Medicare Advantage and Obamacare should be treated differently for federal anti-fraud protections, since both involve direct payments from the government to private health care plans.
Adding to the confusion, the department put out guidance this week saying it "has broad authority to regulate the Federal and State Marketplaces" and "discourages" providers from giving premium support and other help to enrollees. The guidance is available here.
"I intend to do everything I can to get to the bottom of whether the federal agency in charge of Obamacare will apply every available anti-fraud protection to this program," Grassley said.
Grassley is the Senate author of the 1986 whistleblower amendments strengthening the federal False Claims Act, making it more effective than ever in exposing fraud against the government.
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