If I have affordable coverage in my workplace, I'm not eligible to go into the marketplace. ... It’s illegal.
Department of Health and Human Services Secretary Kathleen Sebelius testified before Congress Oct. 30 for the first time since the federal health care marketplaces went online, answering questions about problems with the website and facing accusations that President Barack Obama lied to the American people about who could keep their health care plan. At the tail end of three and a half hours of testimony, Sebelius had a testy exchange with Rep. Cory Gardner, R-Colo., who asked the secretary why she wasn’t enrolling in the exchanges herself. "If I have affordable coverage in my workplace, I'm not eligible to go into the marketplace. ... It’s illegal," she said. The Twittersphere lit up after Sebelius’ remarks, questioning whether they were valid. Even the government’s own website instructs people with job-based insurance that "if you'd like to explore marketplace coverage options you can." So was Sebelius right and the Obamacare website wrong, or vice versa? Given the vast amount of misinformation circulating around the health care law and the insurance marketplaces, we thought it necessary to straighten this out. Employer insurance vs. Medicare We went right to the source on this one, asking the Department of Health and Human Services if Sebelius misspoke. It turns out she did. Individuals who have health insurance through their employer can sign up for the online marketplaces, it’s just not financially beneficial for most to do so. If an individual forgoes affordable insurance through work, he or she won’t qualify for subsidies to help pay for insurance on the government-run marketplaces. And plans purchased through an employer are typically cheaper because the company is paying a portion of the costs. A spokeswoman for the department said Sebelius meant to say, "Marketplace plans cannot be sold to a Medicare enrollee, and the secretary is a Medicare enrollee." While Sebelius receives health benefits from her government job, as of May, she is also 65 years old and therefore eligible for free Medicare Part A, which covers hospital visits. She can couple those benefits with her employer insurance, but according to guidelines released Oct. 4 by the Center for Medicare & Medicaid Services, "it is illegal to knowingly sell or issue a Qualified Health Plan to a Medicare beneficiary" on the government-run insurance marketplaces. That hasn’t always been clear, said David Lipschutz, a policy attorney at the Center for Medicare Advocacy. Nothing in the Affordable Care Act mentions whether Medicare enrollees are eligible for the health insurance marketplaces, he said, but the administration lately has cited a section of the Social Security Act also known as the Medicare Anti-Duplication provision that bars private insurance companies from offering coverage to Medicare enrollees. There are some exceptions. A small fraction of individuals who are not eligible for free Medicare Part A and those with end stage renal disease can still buy insurance on the exchanges and receive federal subsidies. Neither of those situations apply to Sebelius. Hypothetically, Sebelius could abandon her government health care plan and get out of Medicare Part A. But that would require her to revoke and forfeit her Social Security benefits for the rest of her life, something we can’t envision anyone volunteering to do. "It’s really not going to be an option to drop it in order to get into an exchange," said Andrea Callow, also a policy attorney with the Center for Medicare Advocacy. Our ruling It’s pretty clear Sebelius was wrong when she said "it’s illegal" for her to buy insurance on the exchange because she already has affordable insurance through her employer. Those inclined to do so certainly can, though the financial incentives to stay with the employer-based plan are quite convincing. We rate her statement Pants on Fire.
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