Looking for a little extra cash? If you’re interested in defrauding taxpayers, it might be as easy as writing down a number on a form.
The number is your income. The form is the Obamacare application.
If you do not have “affordable” employer-sponsored health insurance and your income is between about $31,800 and $94,200 for a family of four (that is, between 138 percent and 400 percent of the federal poverty level), you qualify for an insurance subsidy through Obamacare.
But when you apply for coverage in the Obamacare insurance exchange, it’s up to you to report your income accurately. It turns out that the IRS won’t be checking everyone’s Obamacare applications.
Heritage health care expert Chris Jacobs ran the numbers to show what a difference a little fraud can make. He took a hypothetical family of four with $90,000 in income who were eligible for coverage through the exchange. If this family were honest, they would receive a subsidy of $2,997 to help cover their insurance premiums.
But if that same family put down $35,000 as their income instead, they would receive $10,175 from taxpayers. Even if they were caught, they would have to pay back only $2,500 of their ill-gotten subsidy, due to a loophole in Obamacare.
Will anyone be checking? It’s doubtful, Jacobs writes:
Supporters of the law claim this scenario will not happen, due to the penalties associated with misrepresenting information on application forms and tax documents. But with government auditors noting the exchanges have missed critical deadlines, and Obamacare anti-fraud investigations being cancelled, will the federal government really have the resources necessary to enforce the law, much less ensure taxpayer funds are not being abused?
Congress should not expose taxpayers to this kind of liability. It’s another reason to defund Obamacare.