Consumers who bought healthcare through federal and state exchanges received almost $11 billion in assistance in fiscal year 2014, according to a report by the Treasury Department’s Inspector General for Administration.
The report, available online, acknowledges that during the first quarter 2015 they received incomplete information from the exchanges. In addition, there were some programming errors in the computer systems the agency uses to spot fraudulent and incorrect claims for.
Some these problems have been fixed or soon will be, according to the Inspector General’s interim report. (Some lines in the report are redacted, to protect information they believe could be used to file fraudulent PTC claims.) A final report will be issued later in 2015.
As of March 26 this year, the processed nearly 1.4 million that claimed about $4.4 billion in PTCs. Taxpayers claimed more than $240 million in additional PTCs, and reported receiving more than $572 million in excess PTC payments, which are subject to refunds.
The PTC was created through the Affordable Care Act to help cover premiums for consumers who buy through exchanges. It is refundable, meaning that individuals who owe little or no income can still receive the credit.
Exchanges are responsible for determining the amount an individual is eligible to receive. They do so by pulling data from various federal agency databases, including Homeland Security and Social Security, as well as from state files.
Consumers can direct to their company or use them to reduce their liability.
“Because incomplete or unreported data from the exchanges,” according to the Inspector General’s report, has been unable to verify that all taxpayers claiming the PTC are actually eligible to purchase the exchanges. The agency is also unable to ensure that all taxpayers who received a tax properly reported that information on their .
They expected the exchanges to start providing data in June 2014, but the information did not start flowing in until October. Even then, the federal exchange did not include 1.7 million of the 4.2 million enrollments.
In addition, they did not receive data for individuals in six of the 15 state exchanges as January 20, 2015. For 10 state exchanges they did receive data, but not in for them to validate the data prior to the start of the filing season. The agency needs to validate the state exchange data to use it to verify, the report noted.
On top of the problems obtaining information from the exchanges, the report says, the computer software they used to load the exchange information into its return processing systems did not function properly.
The software problems included mistakenly flagging 260,000 for PTC “errors” that didn’t exist, unnecessary delays in issuing refunds to some taxpayers, and allowing some PTC claims that should have been denied.
The report did not detail the reasons for the delayed delivery, or the non-delivery, exchange information to the .
It said the agency is in the process of correcting the software issues for the 2016 season.
The report included a response from management. It said the agency has “implemented a combination vigorous preprocessing and real-error controls” which have addressed some of the issues raised in the report.
The response noted that about 1.3 million PTC errors were spotted and fixed so they could be processed, and 200,000 with other problems were sent back to taxpayers for correction. “We are pleased with the overall success of these efforts,” adding it to make additional fixes before the 2016 filing season.