Press Release

New E&C Report Sounds Alarm Over Obamacare Exchange Stability


09.13.16

Report Highlights Billions of Taxpayer Dollars At Risk - Comes Ahead of Joint #SubHealth & #SubOversight Hearing TOMORROW


WASHINGTON, DC – The House Energy and Commerce Committee, chaired by Rep. Fred Upton (R-MI), today released a new report chronicling the failures of state exchanges established under Obamacare. The report entitled, “Implementing Obamacare: A Review of CMS’ Management of the State-Based Exchanges,” was released ahead of Wednesday’s hearing examining the committee’s oversight and the future outlook of the health care law.

The executive summary of the report explains, “By 2017, at least five of the original SBEs [state-based exchanges] will have closed, leaving only 12 remaining. These five SBEs alone represent hundreds of millions in wasted taxpayer dollars. … Neglecting to limit the dollars granted to SBEs and inadequate oversight of documented wasteful spending has cost the American taxpayer millions of dollars. Six years into the implementation of PPACA, it is time that the administration strengthen its measures to account for the significant waste of taxpayer dollars, and improve oversight on the SBE program.”

Among the report’s findings are:

  • CMS is not confident that the remaining SBEs will be sustainable in the long term.
  • As of September 2016, every SBE still relies upon federal establishment grant funds – 20 months after SBEs were to be self-sustaining by law.
  • The Government Accountability Office issued two reports in CMS oversight of the SBEs. All of the 6 recommendations for how CMS can improve its oversight of the SBEs remain “open,” indicating that CMS has not implemented a single one.
  • CMS eased the transition for failed SBEs to join HealthCare.gov by allowing them to keep user fees collected by insurance carriers intended to pay for the use of HealthCare.gov.

To help address these and other concerning findings, the report includes five recommendations:

“Taxpayer dollars are going down the drain at an alarming rate, and yet the administration treats the hundreds of millions of dollars squandered as acceptable. There needs to be zero tolerance for such waste,” said full committee Chairman Fred Upton (R-MI) and Oversight and Investigations Subcommittee Chairman Tim Murphy (R-PA). “Mismanagement and lax oversight have come to define the state exchanges, and the marketplaces that Americans have come to rely on are on shaky ground. In the wake of this marketplace mess, we’ve got five thoughtful recommendations that will go a long way toward protecting taxpayers.”

Click here to access a copy of the report.

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Press Release