Vitter Seeks Answers From IRS on Congress’s Obamacare Contradiction

Congress's forms to IRS don’t match claims made to D.C.-based Obamacare exchange

Sen. David Vitter (R., La.) / AP
February 18, 2016

Sen. David Vitter (R., La.) is demanding answers from the IRS after Congress was issued tax forms designating it as a large employer despite its registering as a "small business" through the Washington, D.C., health care exchange.

The Republican senator sent a letter to IRS Commissioner John Koskinen inquiring whether it was a violation of the Internal Revenue Code for Congress to declare to the IRS that it was a large employer while declaring to the D.C. government that it was a small business.

Congress’s efforts to comply with Obamacare regulations have been dogged by controversy since the bill’s passage in 2010. An amendment to the Affordable Care Act required congressional employees to sign up for coverage through the health care exchanges but offered no provision for subsidies.

The Office of Personnel Management (OPM) used a federal regulation in 2013 to deem Congress a "small business," thereby making its employees eligible for subsidies, despite the fact that Congress has more than 12,000 workers and dependents.

Vitter’s letter suggested that the contradiction in paperwork means Congress is flouting the law.

"You also know that in the ACA the term ‘large employer’ is defined as an employer with 50 or more full-time employees. And yet, as described above, Congress has registered as a small employer, creating a conflict that is a cause of great concern," Vitter writes in his letter.

"Given that Congress has registered itself with DC Health Link as a small business, yet has declared to the Internal Revenue Service it is a large employer, it would appear that it is misrepresenting itself to either the DC Health Link or to the IRS … it cannot be both a small employer and a large employer. It is utterly absurd that Congress is trying to be both."

The form referenced by Vitter in the letter is addressed from the U.S. Senate Disbursing Office to the U.S. Senate. On page 2, under the "Instructions for Recipient," the form describes the Senate as an "Applicable Large Employer subject to the employer shared responsibility provision in the Affordable Care Act."

However, when the Obamacare markets opened, applications were submitted to the Washington, D.C. Health Benefits Exchange Authority—now known as DC Health Link—on behalf of Congress that listed it as a small business.

Judicial Watch, a government watchdog, obtained the applications through a Freedom of Information Act request and discovered that the documents submitted on behalf of the Senate listed the Senate Disbursement Office as its address and that it employed 50 or fewer full-time workers. The first name on the application additionally read "Twenty" while the last name read "Congress." The House portion was filled out in exactly the same manner.

A coalition of 10 watchdog groups, led by Citizens Against Government Waste (CAGW), have filed an ethics complaint calling for an investigation into whether members of Congress and their staff committed fraud when applying to the health insurance exchange.

"As open enrollment approached in 2014, members and staff realized that by enrolling as individuals, they would no longer receive generous taxpayer-funded contributions to help pay their insurance premiums as they had for decades under the Federal Employees Health Benefits Program," CAGW said in a press release at the time. "They would instead only qualify for subsidies if their household income was less than 400 percent of the federal poverty level, just like millions of other Americans that had to purchase insurance in the individual market."

Vitter told the Washington Free Beacon that Congress’s efforts to obtain subsidies for its employees are "absurd."

"Congress can’t have it both ways—it cannot be both a small employer and a large employer, and we all know which it is," Vitter said. "It’s utterly absurd that Congress was allowed to claim to be a small business just to keep the taxpayer-funded Obamacare Exemption, but is now telling the IRS that it’s a large employer."

"Our ongoing mission is to maintain and uphold the government’s credibility in the eyes of all Americans, and to make Washington live under Obamacare just like the rest of the country has been forced to accept," he said.

The IRS said in an email that they are reviewing the letter and will respond accordingly.