BOOM: CMS bows to my will* again, implements SEP verification requirements

*(OK, not really; I'm not the only one who was suggesting this, but it some people really do seem to think that I have dictatorial control over CMS...)

Some Guy, 11/22/15:

I guess the question here is just how much verification the HHS Dept. and/or the assorted state-based exchanges are doing of these claims. In cases like getting married/divorced, giving birth, becoming a citizen or getting out of jail, I would imagine the verification should be pretty easy. However, the "Tax Penalty Ignorance" exception was pretty much based on an honors system, and I don't know how easy/difficult it is for the feds to "verify" that your income has increased/decreased least, not until you file your taxes the following year, which could be up to a year after the claim is made.

...So, what's the solution to this, assuming the problem is widespread? Well, I can think of some obvious tweaks to the rules, almost all of which involve simply reducing grace periods:

  • Shorten the 90-day Payment grace period down to 30 or 60 days.
  • Shorten the 95-day Residency Documentation data matching grace period down to 30 or 60 days.
  • Shorten the 3-month Individual Mandate grace period to 1 or 2 months.
  • Shorten the 60-day grace periods for having a baby, getting married, etc. down to 30 days.

​Beyond that, I'd imagine it's just a matter of tightening up the verification of any/all of the above, assuming that it's not being checked very thoroughly at the moment.

...After all of the above, I guess my real question is this: DOES CMS/Healthcare.Gov actually verify SEP eligibility at all? I've never needed to use one, so I don't know what happens when you try to do so. Does it require you to upload a copy of your marriage certificate, the birth certificate for your newborn, a termination notice, change of address form, etc etc? I have no idea. How about the state-based exchanges?

I don't imagine that there would be any way of proving fraud for dropping your coverage at any time after signing up as long as you've paid the minimum number of monthly premiums, but signing up during the off season should have some sort of verification process.

CMS, 1/12/16:

...Andy Slavitt...acknowledged the problems and said the administration would tighten the rules for special enrollments — and terminate coverage for those who found to have signed up improperly.

"There are some [special enrollment periods] that we need to clarify because they're subject frankly to abuse," Slavitt said...the administration would spell out its plans in the next week, and stressed that people who want coverage need to get it by the Jan. 31 deadline for the regular signup period.

CMS, 1/19/16:

Enforcing the Rules: Finally, we will take steps to make sure that consumers understand and comply with the rules. We will conduct an assessment of plan selections that are made through certain special enrollment periods to evaluate whether consumers properly accessed coverage. Our program integrity team will pull samples of consumer records nationally and may request additional information from some consumers or take other steps to validate that consumers properly qualified for these special enrollment periods. The findings from the assessment will help us to inform future policy and operational improvements to enhance program integrity. Additional details will be provided in the coming weeks.

 We will also emphasize more strongly to applicants that the law requires that consumers provide accurate information to the Marketplace, and they may be subject to penalties under federal law if they intentionally provide false or untrue information.

It sounds like this is likely to be make the biggest difference of the above. I figured they'd require everyone to upload a scanned copy of their documentation (marriage certificate, employment termination notice, jail release notice, etc), but apparently they're gonna go with more of a "random IRS-style audit" sort of thing, which I suppose could work as well.

And finally, CMS, just moments ago:

The New Special Enrollment Confirmation Process

Today, we are announcing another step that will enhance program integrity and contribute to a stable rate environment and affordability for consumers: a new Special Enrollment Confirmation Process in the 38 states using the platform. Under the new process, all consumers applying through the most common special enrollment periods will need to submit documentation to verify their eligibly to use an SEP. This represents a major overhaul of the SEP process. You can read more about the Special Enrollment Confirmation Process here.

Special enrollment periods are an important way to make sure that people who lose health insurance during the year or who experience qualifying life changes have the opportunity to enroll in coverage. We are committed to making sure that special enrollment periods are available to those who are eligible for them. But it’s equally important to avoid misuse or abuse of special enrollment periods.

This change in’s special enrollment period process does not restrict anyone’s access to a special enrollment period who is rightfully able to enroll in coverage. But consumers will need to be sure to provide sufficient documentation to establish their eligibility. If an individual doesn’t respond to our notices, they could be found ineligible to enroll in Marketplace coverage and could lose their insurance.

As we begin work to implement the new process, CMS will solicit feedback from consumer advocates, insurers and other stakeholders over the next few weeks on verification requirements, processes and acceptable documentation. We welcome feedback and suggestions, which can be sent to


OK, the link in CMS's blog post gives some additional details:

Once the new Special Enrollment Confirmation Process is implemented, all consumers enrolling through the most common SEPs will need to submit documentation to verify their eligibility to use an SEP. The Special Enrollment Confirmation Process will be accompanied by other improvements to the SEP application process, described below. Today’s announcement represents a major overhaul of the SEP process.

...Document Submission by Consumers: Beginning in the next several months, all consumers who enroll or change plans using an SEP for any of the following triggering events will be directed to provide documentation:

  • Loss of minimum essential coverage,
  • Permanent move,
  • Birth,
  • Adoption, placement for adoption, placement for foster care or child support or other court order, or
  • Marriage.  

These SEPs represented three quarters of consumers who enrolled or changed plans using an SEP in the second half of 2015. 

We will provide consumers with lists of qualifying documents, like a birth or marriage certificate. Consumers will be able to upload documents to their account or mail them in.

Here's another suggestion: Whip up an app for that!

...develop a smartphone app similar to the apps many banks already provide for taking photos of checks; the app recognizes watermarks and scans for the routing number/etc, then electronically deposits the check. I have to imagine something similar could be arranged for here to improve the process.

They're also adding clarification text to the SEP enrollment portion of the website, and are adding a new "I understand that I might have to provide proof" checkbox to the SEP website form, which should help a bit, but really, uploading the documentation should help resolve any "gaming" issues (whether serious or minor) quite a bit.