text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``No Subsidies Without Verification 
  Act of 2014''.
  
  SEC. 2. FINDINGS.
  
      Congress finds the following:
              (1) On July 5, 2013, the Department of Health and Human 
          Services released more than 600 pages of a final rule to 
          implement the provisions of the Patient Protection and 
          Affordable Care Act and the health care provisions of the 
          Health Care and Education Reconciliation Act of 2010 (commonly 
          referred to as ``Obamacare'' or the ``ACA'').
              (2) Such final rule included an announcement that the 
          Federal Government would no longer verify that each applicant 
          for premium tax credits or cost-sharing reductions for coverage 
          offered through an Exchange established under the Patient 
          Protection and Affordable Care Act are actually qualified for 
          such credits or reductions. Instead, the Administration would 
          rely on self-attestation and sample audits of a sample 
          population to ``protect'' the integrity of this new $1 trillion 
          entitlement program.
              (3) The Department of Health and Human Services later 
          announced a change in such policy and stated it would extend 
          the sample population to 100 percent. This change, though 
          announced, was never made to the final rule, meaning there was 
          no guarantee to the American people that applicants would be 
          verified.
              (4) It is estimated that not verifying eligibility for such 
          credits and reductions could likely equate to approximately 
          $250 billion in fraudulent payments through payments of such 
          Obamacare premium tax credits and cost-sharing reductions.
              (5) The final rule provides that the Department of Health 
          and Human Services will offer to perform this verification 
          procedure for States that are establishing a State-based 
          Exchange, but will be unable to do so until 2015. As a result, 
          such States will not be required to randomly verify employer-
          sponsored coverage until 2015.
              (6) In order to protect taxpayers after the Department of 
          Health and Human Services failed to implement a new rule that 
          it would ensure Congress and taxpayers that verification of 
          eligibility would be performed, the House of Representatives 
          advanced legislation, H.R. 2775, the No Subsidies Without 
          Verification Act. This legislation would have provided the 
          force of law to ensure that verification would occur prior to 
          the issuance of any Obamacare premium tax credit or cost-
          sharing reduction.
              (7) On September 12, 2013, this legislation was passed in 
          the House of Representatives with bipartisan support by a 235 
          to 191 vote margin.
              (8) On September 10, 2013, the Obama Administration issued 
          a Statement of Administration Policy to H.R. 2775 that stated 
          ``the Administration strongly opposes House passage of H.R. 
          2775 because the goal of the bill is already being accomplished 
          while the text of the bill would create delays that could cost 
          millions of hard-working middle-class families the security of 
          affordable health coverage and care they deserve''.
              (9) The Statement of Administration Policy also stated that 
          ``H.R. 2775 is unnecessary because the Secretary of Health and 
          Human Services has already put in place an effective and 
          efficient system for verification of eligibility for premium 
          tax credits and cost sharing reductions.''.
              (10) On October 16, 2013, the Senate removed the 
          verification mechanism of H.R. 2775 and replaced it with 
          language that required a report to Congress by the Secretary of 
          Health and Human Services no later than January 1, 2014.
              (11) On January 1, 2014, the Department of Health and Human 
          Services submitted a mandated report to Congress entitled, 
          ``Verification of Household Income and Other Qualifications for 
          the Provision of Affordable Care At Premium Tax Credits and 
          Cost-Sharing Reductions''.
              (12) This report to Congress states, ``In accordance with 
          statute and applicable implementing regulations, when a 
          consumer submits an application for insurance affordability 
          programs (which include APTCs, CSRs, Medicaid, the Children's 
          Health Insurance Program (CHIP), and the Basic Health Program 
          (BHP)), the Exchange verifies information provided by the 
          consumer on the application as a component of making an 
          eligibility determination. The processes for verifying 
          information in order to determine eligibility for enrollment in 
          a qualified health plan (QHP) through the Exchange and for APTC 
          under section 36B of the Internal Revenue Code (the Code) and 
          CSRs under section 1402 of the ACA are specified in the ACA and 
          its implementing regulations. Pursuant to both statute and 
          applicable regulations, the Exchanges have implemented numerous 
          processes to carry out the verification of information provided 
          by applicants.''.
              (13) Beginning in 2014, Federal subsidies have been made 
          available to help individuals purchase health insurance through 
          an Exchange through premium tax credits and cost-sharing 
          reductions. On April 2014, the Department of Health and Human 
          Services delayed implementation of income verification systems 
          in order to increase sign-ups for health care plans through the 
          healthcare.gov website.
              (14) Various reports indicate that the internal portions of 
          the healthcare.gov website are yet to be finalized, thus 
          leaving the Department of Health and Human Services unable to 
          perform the verification it stated it was performing. The Obama 
          Administration is operating a new Federal entitlement program 
          that fails to prevent fraudulent subsidy claims before 
          administered. In doing so, the Department of Health and Human 
          Services has created a new ``pay and chase'' program that 
          places taxpayers at financial risk of fraudulent claims.
  
  SEC. 3. DELAYING PROVISION OF ACA PREMIUM AND COST-SHARING SUBSIDIES 
                UNTIL ELIGIBILITY VERIFICATION PROCESS FOR SUCH SUBSIDIES 
                IS COMPLETE.
  
      (a) In General.--Notwithstanding any other provision of law, in the 
  case of an individual with respect to whom a premium tax credit under 
  section 36B of the Internal Revenue Code of 1986 or reduced cost-
  sharing under section 1402 of the Patient Protection and Affordable 
  Care Act (42 U.S.C. 18071) is being claimed, no such credit or 
  reduction shall be allowed before the first date of the first coverage 
  month beginning on or after the date on which the process to verify, in 
  accordance with section 1411 of the Patient Protection and Affordable 
  Care Act (42 U.S.C. 18081), the household income and coverage 
  requirements of such individual for purposes of determining eligibility 
  for, and the accurate amount of, such credit or reduction, 
  respectively, has been completed. For purposes of the previous 
  sentence, the verification process described in such sentence with 
  respect to an individual shall not be treated as complete unless a 
  manual or electronic review has been completed of applicable 
  information required to be submitted by such individual under section 
  1411(b) of such Act (42 U.S.C. 18081(b)) and any inconsistency of such 
  information with records of the Secretary of the Treasury, Secretary of 
  Homeland Security, or the Commissioner of Social Security has been 
  resolved.
      (b) Treatment of Individual Mandate.--Notwithstanding any other 
  provision of law, no penalty shall be imposed under section 5000A of 
  the Internal Revenue Code of 1986 with respect to an individual for any 
  month--
              (1) with respect to which a premium tax credit under 
          section 36B of the Internal Revenue Code of 1986 is being 
          claimed for such individual; and
              (2) that begins before the date on which the verification 
          process described in subsection (a) has been completed, in 
          accordance with such subsection, with respect to such claim for 
          such individual.
      (c) Application Provisions.--
              (1) Effective date.--Subject to paragraph (2), the 
          provisions of this section shall apply to coverage months 
          beginning on or after the date of the enactment of this Act.
              (2) Treatment of individuals currently receiving 
          subsidies.--
                      (A) Suspension of certain subsidies.--In the case 
                  of an individual with respect to whom a premium tax 
                  credit under section 36B of the Internal Revenue Code 
                  of 1986 or reduced cost-sharing under section 1402 of 
                  the Patient Protection and Affordable Care Act (42 
                  U.S.C. 18071) has been claimed before the date of the 
                  enactment of this Act and for whom such a credit or 
                  reduction has been allowed before such date, such 
                  allowance shall be suspended until the coverage month 
                  described in subsection (a) with respect to such claim 
                  for such individual.
                      (B) Special enrollment period.--
                              (i) In general.--The Secretary of Health 
                          and Human Services shall take such steps as are 
                          necessary to establish a special enrollment 
                          period of 45 days, beginning on the date of 
                          completion of the verification process 
                          described in subsection (a), with respect to an 
                          individual described in clause (ii), for such 
                          individual to enroll in qualified health plans 
                          offered through Exchanges established under 
                          title I of the Patient Protection and 
                          Affordable Care Act.
                              (ii) Individual described.--For purposes of 
                          clause (i), an individual described in this 
                          clause is an individual--
                                      (I) who is enrolled in a qualified 
                                  health plan described in clause (i) 
                                  before the date of the enactment of 
                                  this Act;
                                      (II) to whom the suspension under 
                                  subparagraph (A) applies;
                                      (III) who terminated enrollment in 
                                  the qualified health plan during such 
                                  period of suspension; and
                                      (IV) who, after the completion of 
                                  the verification process described in 
                                  subsection (a) with respect to such 
                                  individual, seeks to enroll in such a 
                                  qualified health plan.
target: No Subsidies Without Verification Act of 2014 - Disallows the health plan premium assistance tax credit or cost-sharing reduction under the Patient Protection and Affordable Care Act before the first date of the first coverage month beginning on or after the date on which the process to verify an individual's household income and coverage requirements of such individual for purposes of determining eligibility for, and the accurate amount of, the credit or reduction, respectively, has been completed. Requires for such verification: (1) completion of a manual or electronic review of the information required of an applicant for enrollment in a plan, and (2) resolution of any inconsistency of such information with records of the Departments of the Treasury or Homeland Security (DHS) or the Social Security Administration. Exempts individuals from the penalty for not maintaining minimum essential coverage for any month with respect to which a premium tax credit is being claimed and that begins before the date on which the verification process has been completed. Suspends, until the coverage month beginning after eligibility verification has been completed, the premium tax credit and reduced cost-sharing in the case of individuals for whom the subsidy was allowed before enactment of this Act. Provides a special enrollment period for an individual who terminated enrollment in a qualified plan during the period of suspension.
feat_title: No Subsidies Without Verification Act of 2014