Obamacare loopholes are letting some people wait until they get sick and need expensive care to use late enrollment periods to enroll, or drop coverage while abusing a "grace period" for payment — driving up costs for everyone.
A top health official said Monday the administration plans to crack down on customers who try to game the system by taking unfair advantage,
Politico reports.
"There are some [special enrollment periods] that we need to clarify because they're subject frankly to abuse," Andy Slavitt, acting administrator of the Centers for Medicare and Medicaid Services, said during J.P. Morgan healthcare conference Monday in San Francisco, Politico reports.
"There may be bad actors and others out there who are abusing those."
According to Politico, lax rules let more than 900,000 people sign up for coverage outside the standard enrollment season — for instance, when they change jobs or move — without sufficient proof they're eligible.
It's unknown exactly how many are exploiting the system, but insurers claim latecomers run up much higher medical bills and then drop their Obamacare coverage, contributing to double-digit rate increases and financial losses, Politico reports.
Insurers also complain about people who exploit a three-month "grace period" that lets them get the subsidized coverage even if they've stopped paying for it.
Slavitt said the agency has created an enforcement task force to ensure people are being honest, and that it's cut off coverage for some consumers who didn
't have legitimate reasons for enrolling outside the deadline,
The Wall Street Journal reports.
"It's still a small minority of enrollees," Larry Levitt, senior vice president for special initiatives at the Kaiser Family Foundation, tells Politico. "It's overstating it to say people can simply sign up whenever they want."
"The trick is to limit these special-enrollment periods to people who truly find themselves in unforeseen circumstances, but without making the burden of documentation so great that it discourages people who really qualify."
But according to Politico, UnitedHealth Group, the country's largest insurer is threatening to pull out if the problems aren't addressed, while others warn the marketplaces will unravel without reforms.
"Unless some fundamental flaws are corrected, we believe there is a grave risk that the federal exchange will not operate as a viable, competitive market in 2017," Aetna wrote to the Obama administration about proposed marketplace rules for 2017, Politico reports.
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