Vitter Legislation Would End Congress’ Obamacare Exemption

Follows ethics complaint about possible fraud

Sen. David Vitter / AP
July 22, 2015

Sen. David Vitter (R., La.) introduced legislation today tackling an exemption to the Affordable Care Act that allows members of Congress to avoid purchasing insurance through one of health care exchanges created under the law and to receive taxpayer-funded subsidies.

The legislation follows an ethics complaint filed by a coalition of watchdog groups calling for an investigation into whether Congress committed fraud on applications submitted to the Washington, D.C., health insurance exchange.

Vitter’s bill would make the president, vice president, political appointees, and members of Congress purchase health insurance through an exchange. The legislation would also ensure that these individuals cannot receive a federal subsidy.

"To put it plainly, Congress passed a bad law and then exempted itself from having to live under it. Washington’s Obamacare Exemption is a pathetic, yet telling example of today’s political environment in which D.C.’s elite abuses its bureaucratic power for personal gain while the rest of America has no such relief," Vitter said in a statement. "It’s time that Congress leads by example and do what we have required of millions of Americans and end the Washington Obamacare exemption."

Sen. Vitter, who chairs the Senate Small Business and Entrepreneurship Committee, released a report on July 20 after a months-long investigation into actions taken by Congress and individuals who submitted the applications.

On October 2, 2013, the Office of Personnel Management (OPM) deemed Congress a "small business" despite Congress employing over 12,000 people. Watchdog groups note that senators worked with the Obama administration and OPM before the regulation seeking guidance on how to apply in the Small Business Health Options Program (SHOP).

The SHOP exchange allows businesses that employ 50 or fewer full-time employees flexibility in selecting health insurance options, including the ability to determine how much to contribute to employees’ premiums, and offers taxpayer-funded subsidies.

Later, when the Obamacare markets opened, individuals submitted applications to the Washington, D.C., Health Benefit Exchange Authority on behalf of the entire House and Senate. After these applications were turned in, government watchdog group Judicial Watch filed a Freedom of Information Act request seeking to obtain the documents.

The documents Judicial Watch received were partially redacted and did not contain the name of the individuals who submitted them on behalf of the House and Senate.

The unredacted portion of the documents showed the application submitted for the Senate claimed that he or she employed 50 or fewer full-time workers, listed the address of the Senate Dispersing Office, and claimed to be a "state/local government" entity. Additionally, the first name on the application read "Twenty" and last name "Congress." The House of Representatives portion was filled out identically.

Vitter, through his investigation, sought more information concerning how Congress worked with the Obama administration to legally exempt itself from the Affordable Care Act, including the the identities of those who submitted the applications to the health insurance market.

However, Vitter himself was blocked from receiving any additional information that was not already made public in one way or another.

On April 23, 2015, after numerous failed attempts to obtain additional information through requests, Vitter held a committee meeting that included deliberation and a vote on issuing a subpoena to receive the nine pages of applications submitted on behalf of the House and the Senate without any alterations, omissions, or redactions.

The committee shot the issuance of a subpoena down by a 5-14 vote. Sens. Vitter, Marco Rubio (R., Fla.) Tim Scott (R., S.C.), Cory Gardner (R., Colo.), and Joni Ernst (R., Iowa) voted in favor of issuing the subpoena for the unredacted applications. Sens. Rand Paul (R., Ky.), Jim Risch (R., Idaho), Deb Fischer (R., Neb.), Kelly Ayotte (R., N.H.), Mike Enzi (R., Wyo.), Jeanne Shaheen (D., N.H.), Maria Cantwell (D., Wash.), Ben Cardin (D., Md.), Heidi Heitkamp (D., N.D.), Ed Markey (D. Mass.), Cory Booker (D., N.J.), Chris Coons (D., Del.), Mazie Hirono (D., Hawaii), and Gary Peters (D., Mich.) opposed the subpoena.

A coalition of ten watchdog groups, led by the Council for Citizens Against Government Waste, recently filed an ethics complaint calling for an investigation into whether the applications submitted to the health insurance exchange in Washington, D.C., were fraudulent.

The complaint, filed to the Senate Ethics Committee, claimed that members and their staff might have violated laws by claiming to be a "small business" on the insurance applications in order to qualify for taxpayer-funded subsidies.

"By pushing for OPM to issue the regulation that ostensibly allows them to ‘be a small business’ and participate in the D.C. SHOP, members of Congress and their staff have found a clever, but potentially illegal way to get access to government financial assistance to help pay for their health insurance premiums," the complaint read.

"Members of Congress have tried to keep this special carve-out for themselves quiet. After all, they are supposed to participate in Obamacare like any other citizen who purchases their health insurance in the individual market."