42 U.S.C. § 18081 — Procedures for determining eligibility

Page 9130 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 18081 1 See References in Text note below. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2021 AMENDMENT Pub. L. 117–2, title II, § 2305(b), Mar. 11, 2021, 135 Stat. 40, provided that: ‘‘The amendment made by this sec- tion [amending this section] shall apply to plan years beginning after December 31, 2020.’’ PART B—ELIGIBILITY DETERMINATIONS § 18081. Procedures for determining eligibility for Exchange participation, premium tax credits and reduced cost-sharing, and indi- vidual responsibility exemptions (a) Establishment of program The Secretary shall establish a program meet- ing the requirements of this section for deter- mining— (1) whether an individual who is to be cov- ered in the individual market by a qualified health plan offered through an Exchange, or who is claiming a premium tax credit or re- duced cost-sharing, meets the requirements of sections 18032(f)(3), 18071(e), and 18082(d) of this title and section 36B(e) of title 26 that the in- dividual be a citizen or national of the United States or an alien lawfully present in the United States; (2) in the case of an individual claiming a premium tax credit or reduced cost-sharing under section 36B of title 26 or section 18071 of this title— (A) whether the individual meets the in- come and coverage requirements of such sec- tions; and (B) the amount of the tax credit or reduced cost-sharing; (3) whether an individual’s coverage under an employer-sponsored health benefits plan is treated as unaffordable under sections 36B(c)(2)(C) and 5000A(e)(2) of title 26; 1 and (4) whether to grant a certification under section 18031(d)(4)(H) of this title attesting that, for purposes of the individual responsi- bility requirement under section 5000A of title 26, an individual is entitled to an exemption from either the individual responsibility re- quirement or the penalty imposed by such sec- tion. (b) Information required to be provided by appli- cants (1) In general An applicant for enrollment in a qualified health plan offered through an Exchange in the individual market shall provide— (A) the name, address, and date of birth of each individual who is to be covered by the plan (in this subsection referred to as an ‘‘enrollee’’); and (B) the information required by any of the following paragraphs that is applicable to an enrollee. (2) Citizenship or immigration status The following information shall be provided with respect to every enrollee: (A) In the case of an enrollee whose eligi- bility is based on an attestation of citizen- ship of the enrollee, the enrollee’s social se- curity number. (B) In the case of an individual whose eli- gibility is based on an attestation of the en- rollee’s immigration status, the enrollee’s social security number (if applicable) and such identifying information with respect to the enrollee’s immigration status as the Secretary, after consultation with the Sec- retary of Homeland Security, determines ap- propriate. (3) Eligibility and amount of tax credit or re- duced cost-sharing In the case of an enrollee with respect to whom a premium tax credit or reduced cost- sharing under section 36B of title 26 or section 18071 of this title is being claimed, the fol- lowing information: (A) Information regarding income and family size The information described in section 6103(l)(21) of title 26 1 for the taxable year ending with or within the second calendar year preceding the calendar year in which the plan year begins. (B) Certain individual health insurance poli- cies obtained through small employers The amount of the enrollee’s permitted benefit (as defined in section 9831(d)(3)(C) of title 26) under a qualified small employer health reimbursement arrangement (as de- fined in section 9831(d)(2) of such title). (C) Changes in circumstances The information described in section 18082(b)(2) of this title, including informa- tion with respect to individuals who were not required to file an income tax return for the taxable year described in subparagraph (A) or individuals who experienced changes in marital status or family size or signifi- cant reductions in income. (4) Employer-sponsored coverage In the case of an enrollee with respect to whom eligibility for a premium tax credit under section 36B of title 26 or cost-sharing re- duction under section 18071 of this title is being established on the basis that the enroll- ee’s (or related individual’s) employer is not treated under section 36B(c)(2)(C) of title 26 as providing minimum essential coverage or af- fordable minimum essential coverage, the fol- lowing information: (A) The name, address, and employer iden- tification number (if available) of the em- ployer. (B) Whether the enrollee or individual is a full-time employee and whether the em- ployer provides such minimum essential cov- erage. (C) If the employer provides such min- imum essential coverage, the lowest cost op- tion for the enrollee’s or individual’s enroll- ment status and the enrollee’s or individ- ual’s required contribution (within the meaning of section 5000A(e)(1)(B) of title 26) under the employer-sponsored plan. (D) If an enrollee claims an employer’s minimum essential coverage is unaffordable, the information described in paragraph (3). Page 9131 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 18081 2 So in original. Probably should not be capitalized. If an enrollee changes employment or obtains additional employment while enrolled in a qualified health plan for which such credit or reduction is allowed, the enrollee shall notify the Exchange of such change or additional em- ployment and provide the information de- scribed in this paragraph with respect to the new employer. (5) Exemptions from individual responsibility requirements In the case of an individual who is seeking an exemption certificate under section 18031(d)(4)(H) of this title from any require- ment or penalty imposed by section 5000A of title 26,1 the following information: (A) In the case of an individual seeking ex- emption based on the individual’s status as a member of an exempt religious sect or divi- sion, as a member of a health care sharing ministry, as an Indian, or as an individual eligible for a hardship exemption, such infor- mation as the Secretary shall prescribe. (B) In the case of an individual seeking ex- emption based on the lack of affordable cov- erage or the individual’s status as a tax- payer with household income less than 100 percent of the poverty line, the information described in paragraphs (3) and (4), as appli- cable. (c) Verification of information contained in records of specific Federal officials (1) Information transferred to Secretary An Exchange shall submit the information provided by an applicant under subsection (b) to the Secretary for verification in accordance with the requirements of this subsection and subsection (d). (2) Citizenship or immigration status (A) Commissioner of Social Security The Secretary shall submit to the Com- missioner of Social Security the following information for a determination as to whether the information provided is con- sistent with the information in the records of the Commissioner: (i) The name, date of birth, and social se- curity number of each individual for whom such information was provided under sub- section (b)(2). (ii) The attestation of an individual that the individual is a citizen. (B) Secretary of Homeland Security (i) In general In the case of an individual— (I) who attests that the individual is an alien lawfully present in the United States; or (II) who attests that the individual is a citizen but with respect to whom the Commissioner of Social Security has no- tified the Secretary under subsection (e)(3) that the attestation is inconsistent with information in the records main- tained by the Commissioner; the Secretary shall submit to the Sec- retary of Homeland Security the informa- tion described in clause (ii) for a deter- mination as to whether the information provided is consistent with the informa- tion in the records of the Secretary of Homeland Security. (ii) Information The information described in clause (ii) is the following: (I) The name, date of birth, and any identifying information with respect to the individual’s immigration status pro- vided under subsection (b)(2). (II) The attestation that the individual is an alien lawfully present in the United States or in the case of an individual de- scribed in clause (i)(II), the attestation that the individual is a citizen. (3) Eligibility for tax credit and cost-sharing reduction The Secretary shall submit the information described in subsection (b)(3)(A) provided under paragraph (3), (4), or (5) of subsection (b) to the Secretary of the Treasury for verification of household income and family size for purposes of eligibility. (4) Methods (A) In general The Secretary, in consultation with the Secretary of the Treasury, the Secretary of Homeland Security, and the Commissioner of Social Security, shall provide that verifications and determinations under this subsection shall be done— (i) through use of an on-line system or otherwise for the electronic submission of, and response to, the information sub- mitted under this subsection with respect to an applicant; or (ii) by determining the consistency of the information submitted with the infor- mation maintained in the records of the Secretary of the Treasury, the Secretary of Homeland Security, or the Commis- sioner of Social Security through such other method as is approved by the Sec- retary. (B) Flexibility The Secretary may modify the methods used under the program established by this section for the Exchange 2 and verification of information if the Secretary determines such modifications would reduce the admin- istrative costs and burdens on the applicant, including allowing an applicant to request the Secretary of the Treasury to provide the information described in paragraph (3) di- rectly to the Exchange or to the Secretary. The Secretary shall not make any such modification unless the Secretary deter- mines that any applicable requirements under this section and section 6103 of title 26 with respect to the confidentiality, disclo- sure, maintenance, or use of information will be met. (d) Verification by Secretary In the case of information provided under sub- section (b) that is not required under subsection Page 9132 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 18081 (c) to be submitted to another person for verification, the Secretary shall verify the accu- racy of such information in such manner as the Secretary determines appropriate, including del- egating responsibility for verification to the Ex- change. (e) Actions relating to verification (1) In general Each person to whom the Secretary provided information under subsection (c) shall report to the Secretary under the method established under subsection (c)(4) the results of its verification and the Secretary shall notify the Exchange of such results. Each person to whom the Secretary provided information under subsection (d) shall report to the Sec- retary in such manner as the Secretary deter- mines appropriate. (2) Verification (A) Eligibility for enrollment and premium tax credits and cost-sharing reductions If information provided by an applicant under paragraphs (1), (2), (3), and (4) of sub- section (b) is verified under subsections (c) and (d)— (i) the individual’s eligibility to enroll through the Exchange and to apply for pre- mium tax credits and cost-sharing reduc- tions shall be satisfied; and (ii) the Secretary shall, if applicable, no- tify the Secretary of the Treasury under section 18082(c) of this title of the amount of any advance payment to be made. (B) Exemption from individual responsibility If information provided by an applicant under subsection (b)(5) is verified under sub- sections (c) and (d), the Secretary shall issue the certification of exemption described in section 18031(d)(4)(H) of this title. (3) Inconsistencies involving attestation of citi- zenship or lawful presence If the information provided by any applicant under subsection (b)(2) is inconsistent with in- formation in the records maintained by the Commissioner of Social Security or Secretary of Homeland Security, whichever is applicable, the applicant’s eligibility will be determined in the same manner as an individual’s eligi- bility under the medicaid program is deter- mined under section 1396a(ee) of this title (as in effect on January 1, 2010). (4) Inconsistencies involving other information (A) In general If the information provided by an appli- cant under subsection (b) (other than sub- section (b)(2)) is inconsistent with informa- tion in the records maintained by persons under subsection (c) or is not verified under subsection (d), the Secretary shall notify the Exchange and the Exchange shall take the following actions: (i) Reasonable effort The Exchange shall make a reasonable effort to identify and address the causes of such inconsistency, including through ty- pographical or other clerical errors, by contacting the applicant to confirm the accuracy of the information, and by tak- ing such additional actions as the Sec- retary, through regulation or other guid- ance, may identify. (ii) Notice and opportunity to correct In the case the inconsistency or inability to verify is not resolved under subpara- graph (A), the Exchange shall— (I) notify the applicant of such fact; (II) provide the applicant an oppor- tunity to either present satisfactory doc- umentary evidence or resolve the incon- sistency with the person verifying the information under subsection (c) or (d) during the 90-day period beginning the date on which the notice required under subclause (I) is sent to the applicant. The Secretary may extend the 90-day pe- riod under subclause (II) for enrollments occurring during 2014. (B) Specific actions not involving citizenship or lawful presence (i) In general Except as provided in paragraph (3), the Exchange shall, during any period before the close of the period under subparagraph (A)(ii)(II), make any determination under paragraphs (2), (3), and (4) of subsection (a) on the basis of the information contained on the application. (ii) Eligibility or amount of credit or reduc- tion If an inconsistency involving the eligi- bility for, or amount of, any premium tax credit or cost-sharing reduction is unre- solved under this subsection as of the close of the period under subparagraph (A)(ii)(II), the Exchange shall notify the applicant of the amount (if any) of the credit or reduction that is determined on the basis of the records maintained by per- sons under subsection (c). (iii) Employer affordability If the Secretary notifies an Exchange that an enrollee is eligible for a premium tax credit under section 36B of title 26 or cost-sharing reduction under section 18071 of this title because the enrollee’s (or re- lated individual’s) employer does not pro- vide minimum essential coverage through an employer-sponsored plan or that the employer does provide that coverage but it is not affordable coverage, the Exchange shall notify the employer of such fact and that the employer may be liable for the payment assessed under section 4980H of title 26. (iv) Exemption In any case where the inconsistency in- volving, or inability to verify, information provided under subsection (b)(5) is not re- solved as of the close of the period under subparagraph (A)(ii)(II), the Exchange shall notify an applicant that no certifi- cation of exemption from any requirement or payment under section 5000A of such title will be issued. Page 9133 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 18081 3 So in original. Probably should be ‘‘provide’’. (C) Appeals process The Exchange shall also notify each per- son receiving notice under this paragraph of the appeals processes established under sub- section (f). (f) Appeals and redeterminations (1) In general The Secretary, in consultation with the Sec- retary of the Treasury, the Secretary of Home- land Security, and the Commissioner of Social Security, shall establish procedures by which the Secretary or one of such other Federal of- ficers— (A) hears and makes decisions with respect to appeals of any determination under sub- section (e); and (B) redetermines eligibility on a periodic basis in appropriate circumstances. (2) Employer liability (A) In general The Secretary shall establish a separate appeals process for employers who are noti- fied under subsection (e)(4)(C) that the em- ployer may be liable for a tax imposed by section 4980H of title 26 with respect to an employee because of a determination that the employer does not provide minimum es- sential coverage through an employer-spon- sored plan or that the employer does provide that coverage but it is not affordable cov- erage with respect to an employee. Such process shall provide an employer the oppor- tunity to— (i) present information to the Exchange for review of the determination either by the Exchange or the person making the de- termination, including evidence of the em- ployer-sponsored plan and employer con- tributions to the plan; and (ii) have access to the data used to make the determination to the extent allowable by law. Such process shall be in addition to any rights of appeal the employer may have under subtitle F of such title. (B) Confidentiality Notwithstanding any provision of this title 1 (or the amendments made by this title) 1 or section 6103 of title 26, an employer shall not be entitled to any taxpayer return information with respect to an employee for purposes of determining whether the em- ployer is subject to the penalty under sec- tion 4980H of title 26 with respect to the em- ployee, except that— (i) the employer may be notified as to the name of an employee and whether or not the employee’s income is above or below the threshold by which the afford- ability of an employer’s health insurance coverage is measured; and (ii) this subparagraph shall not apply to an employee who provides a waiver (at such time and in such manner as the Sec- retary may prescribe) authorizing an em- ployer to have access to the employee’s taxpayer return information. (g) Confidentiality of applicant information (1) In general An applicant for insurance coverage or for a premium tax credit or cost-sharing reduction shall be required to provide only the informa- tion strictly necessary to authenticate iden- tity, determine eligibility, and determine the amount of the credit or reduction. (2) Receipt of information Any person who receives information pro- vided by an applicant under subsection (b) (whether directly or by another person at the request of the applicant), or receives informa- tion from a Federal agency under subsection (c), (d), or (e), shall— (A) use the information only for the pur- poses of, and to the extent necessary in, en- suring the efficient operation of the Ex- change, including verifying the eligibility of an individual to enroll through an Exchange or to claim a premium tax credit or cost- sharing reduction or the amount of the cred- it or reduction; and (B) not disclose the information to any other person except as provided in this sec- tion. (h) Penalties (1) False or fraudulent information (A) Civil penalty (i) In general If— (I) any person fails to provides 3 correct information under subsection (b); and (II) such failure is attributable to neg- ligence or disregard of any rules or regu- lations of the Secretary, such person shall be subject, in addition to any other penalties that may be prescribed by law, to a civil penalty of not more than $25,000 with respect to any failures involv- ing an application for a plan year. For pur- poses of this subparagraph, the terms ‘‘negligence’’ and ‘‘disregard’’ shall have the same meanings as when used in section 6662 of title 26. (ii) Reasonable cause exception No penalty shall be imposed under clause (i) if the Secretary determines that there was a reasonable cause for the failure and that the person acted in good faith. (B) Knowing and willful violations Any person who knowingly and willfully provides false or fraudulent information under subsection (b) shall be subject, in ad- dition to any other penalties that may be prescribed by law, to a civil penalty of not more than $250,000. (2) Improper use or disclosure of information Any person who knowingly and willfully uses or discloses information in violation of subsection (g) shall be subject, in addition to any other penalties that may be prescribed by law, to a civil penalty of not more than $25,000. Page 9134 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 18082 4 So in original. Probably should be ‘‘on’’. 1 So in original. Probably should be ‘‘employees’’. (3) Limitations on liens and levies The Secretary (or, if applicable, the Attor- ney General of the United States) shall not— (A) file notice of lien with respect to any property of a person by reason of any failure to pay the penalty imposed by this sub- section; or (B) levy on any such property with respect to such failure. (i) Study of administration of employer responsi- bility (1) In general The Secretary of Health and Human Serv- ices shall, in consultation with the Secretary of the Treasury, conduct a study of the proce- dures that are necessary to ensure that in the administration of this title 1 and section 4980H of title 26 (as added by section 1513) 1 that the following rights are protected: (A) The rights of employees to preserve their right to confidentiality of their tax- payer return information and their right to enroll in a qualified health plan through an Exchange if an employer does not provide af- fordable coverage. (B) The rights of employers to adequate due process and access to information nec- essary to accurately determine any payment assessed on employers. (2) Report Not later than January 1, 2013, the Secretary of Health and Human Services shall report the results of the study conducted under para- graph (1), including any recommendations for legislative changes, to the Committees on Fi- nance and Health, Education, Labor and Pen- sions of the Senate and the Committees of 4 Education and Labor and Ways and Means of the House of Representatives. (Pub. L. 111–148, title I, § 1411, Mar. 23, 2010, 124 Stat. 224; Pub. L. 114–255, div. C, title XVIII, § 18001(a)(6)(B), Dec. 13, 2016, 130 Stat. 1342.) Editorial Notes REFERENCES IN TEXT Sections 36B(c)(2)(C) and 5000A(e)(2) of title 26, sec- tion 6103(l)(21) of title 26, and section 5000A of title 26, referred to in subsecs. (a)(3) and (b)(3)(A), (5), were in the original ‘‘sections 36B(c)(2)(C) and 5000A(e)(2)’’, ‘‘section 6103(l)(21)’’, and ‘‘section 5000A’’, respectively, and were translated as if they had been followed by ‘‘of the Internal Revenue Code of 1986’’, to reflect the prob- able intent of Congress. This title, referred to in subsecs. (f)(2)(B) and (i)(1), is title I of Pub. L. 111–148, Mar. 23, 2010, 124 Stat. 130, which enacted this chapter and enacted, amended, and transferred numerous other sections and notes in the Code. For complete classification of title I to the Code, see Tables. Section 1513, referred to in subsec. (i)(1), means sec- tion 1513 of Pub. L. 111–148. AMENDMENTS 2016—Subsec. (b)(3)(B), (C). Pub. L. 114–255 added sub- par. (B) and redesignated former subpar. (B) as (C). Statutory Notes and Related Subsidiaries CHANGE OF NAME Committee on Education and Labor of House of Rep- resentatives changed to Committee on Education and the Workforce of House of Representatives by House Resolution No. 5, One Hundred Eighteenth Congress, Jan. 9, 2023. EFFECTIVE DATE OF 2016 AMENDMENT Amendment by Pub. L. 114–255 applicable to applica- tions for enrollment made after Dec. 31, 2016, see sec- tion 18001(a)(7)(F) of Pub. L. 114–255, set out in a note under section 36B of Title 26, Internal Revenue Code. VERIFICATION OF HOUSEHOLD INCOME AND OTHER QUALIFICATIONS FOR THE PROVISION OF ACA PRE- MIUM AND COST-SHARING SUBSIDIES Pub. L. 113–46, div. B, § 1001, Oct. 17, 2013, 127 Stat. 566, provided that: ‘‘(a) IN GENERAL.—Notwithstanding any other provi- sion of law, the Secretary of Health and Human Serv- ices (referred to in this section as the ‘Secretary’) shall ensure that American Health Benefit Exchanges verify that individuals applying for premium tax credits under section 36B of the Internal Revenue Code of 1986 [26 U.S.C. 36B] and reductions in cost-sharing under section 1402 of the Patient Protection and Affordable Care Act (42 U.S.C. 18071) are eligible for such credits and cost sharing reductions consistent with the re- quirements of section 1411 of such Act (42 U.S.C. 18081), and, prior to making such credits and reductions avail- able, the Secretary shall certify to the Congress that the Exchanges verify such eligibility consistent with the requirements of such Act [Pub. L. 111–148, see Ta- bles for classification]. ‘‘(b) REPORT BY SECRETARY.—Not later than January 1, 2014, the Secretary shall submit a report to the Con- gress that details the procedures employed by Amer- ican Health Benefit Exchanges to verify eligibility for credits and cost-sharing reductions described in sub- section (a). ‘‘(c) REPORT BY INSPECTOR GENERAL.—Not later than July 1, 2014, the Inspector General of the Department of Health and Human Services shall submit to the Con- gress a report regarding the effectiveness of the proce- dures and safeguards provided under the Patient Pro- tection and Affordable Care Act for preventing the sub- mission of inaccurate or fraudulent information by ap- plicants for enrollment in a qualified health plan of- fered through an American Health Benefit Exchange.’’ § 18082. Advance determination and payment of premium tax credits and cost-sharing reduc- tions (a) In general The Secretary, in consultation with the Sec- retary of the Treasury, shall establish a pro- gram under which— (1) upon request of an Exchange, advance de- terminations are made under section 18081 of this title with respect to the income eligi- bility of individuals enrolling in a qualified health plan in the individual market through the Exchange for the premium tax credit al- lowable under section 36B of title 26 and the cost-sharing reductions under section 18071 of this title; (2) the Secretary notifies— (A) the Exchange and the Secretary of the Treasury of the advance determinations; and (B) the Secretary of the Treasury of the name and employer identification number of each employer with respect to whom 1 or more employee 1 of the employer were deter-