A government watchdog group has filed a lawsuit against the Department of Health and Human Services (HHS) after the agency failed to turn over Obamacare records despite the expiration of time limits imposed by the Freedom of Information Act.
Cause of Action Institute, a D.C.-based nonpartisan government accountability organization, filed the lawsuit on March 13 after HHS failed to turn over a variety of Obamacare-related records, including documents about its controversial risk corridors program. That program is designed to transfer money between insurance companies that participate in the Obamacare marketplaces.
The Centers for Medicare and Medicaid Services (CMS), a subsidiary of HHS, previously released a memorandum saying that funding for the risk corridor program would not be available in 2015 due to low enrollment numbers and funding shortfalls.
"The memorandum, however, appears to invite insurers to sue CMS and then settle with the Department of Justice (‘DOJ') to obtain funding, which would constitute an end-run of a provision enacted by Congress in 2014 to prevent shifting funds into the risk corridors program and a violation of DOJ guidance regarding ‘backdoor bailouts,'" Cause of Action said in a press release. "Obtaining risk corridor funding through the DOJ Judgment Fund would be an illegal misuse of appropriated taxpayer money."
Cause of Action also seeks information on attempts to market Obamacare to individuals who declined health insurance coverage using information retrieved from those individuals' federal tax returns.
A fact sheet released by CMS spoke of its intent to "conduct outreach to individuals and families who paid the fee for being uninsured, or claimed an exemption from that fee, for 2015."
Tax information may only be used to determine subsidy eligibility, Cause of Action noted, not to market Obamacare to individuals who chose not to enroll in it.
Additionally, Cause of Action is requesting records on Obamacare's reinsurance program, which transfers money within the health insurance industry to providers that cover high-risk individuals.
"In 2014, HHS was supposed to collect $10 billion in payments to health insurers who enroll high-risk individuals and an additional $2 billion in contributions to be deposited directly to the U.S. Treasury," the group said. "Unfortunately for taxpayers, it appears when HHS collected less money than required by the ACA, the agency violated the law by allocating all funding to health insurers, depriving taxpayers of billions of dollars."
John Vecchione, president and CEO of Cause of Action Institute, said it appears the Obama administration disregarded the law to paint Obamacare in a better light.
"It appears that senior Obama administration officials acted against taxpayers' interests and disregarded the law to make Obamacare appear more successful," Vecchione said. "As Congress continues its efforts to repeal and replace the ACA, it’s more important than ever for HHS to be transparent and forthcoming about Obamacare’s failures and missteps in implementation."
HHS declined to comment on the lawsuit.