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The government may be paying incorrect subsidies to more than 1 million Americans for their health plans in the new federal insurance marketplace and has been unable so far to fix the errors, according to internal documents and three people familiar with the situation.
The problem means that potentially hundreds of thousands of people are receiving bigger subsidies than they deserve. They are part of a large group of Americans who listed incomes on their insurance applications that differ significantly — either too low or too high — from those on file with the Internal Revenue Service, documents show.
From their vantage point, consumer advocates have also been concerned about the possibility of inaccurate income information. They worry that some consumers who have innocently overstated their incomes should be getting higher subsidies — and perhaps better insurance — than they are receiving, while those who accidentally understated their income may get a nasty surprise during tax season next year when the IRS demands that they return any subsidy money they have improperly collected.
“The longer it takes and the more months . . . go by, the more serious the consequences of any error that may have occurred,” said Judy Solomon, vice president for health policy at the Center on Budget and Policy Priorities, which has been pressing its concern with administration officials.
“I have this sick feeling that there are these people out there who have made unintentional errors, and in a few years will be subject to massive tax bills,” said Jessica Waltman, senior vice president for government affairs at the National Association of Health Underwriters, a lobbying group for health insurance brokers.
originally posted by: BrianFlanders
originally posted by: guohua
a reply to: xuenchen
Some people may not know just how serious falsely reporting their income could be.
Some people may not know that you shouldn't have to buy health insurance out of fear of being punished if you don't.