Oversight Report on Obamacare Navigator Program Reveals Mismanagement and Lax Oversight

December 16, 2013

Top HHS Officials Admit They Lacked Navigator Contingency Plan for Healthcare.gov Crash

WASHINGTON – The House Oversight and Government Reform Committee today released a new staff report on the Obama Administration’s Navigator and Assister program in conjunction with today’s field hearing in Dallas, Texas. The report explains how the Administration’s serious mismanagement of these outreach programs exposes Americans to fraud and poses a threat to the safety of consumers’ personal information.

The Navigator program was created by ObamaCare as an outreach program to encourage and facilitate enrollment in health insurance exchanges. The Assister program was created by the Administration with dubious legal authority as a way around ObamaCare’s clear statutory prohibition on using federal exchange establishment funds on Navigators.

Months before the launch of ObamaCare on October 1, the Oversight Committee initiated an investigation into potential problems with the Navigator and Assister program. The Committee released a preliminary staff report in September that highlighted the significant risks for fraud, abuse, and misinformation due to the lack of background checks, inadequate training standards, and weak Administration oversight plan for Navigators and Assisters.

The new report makes clear that U.S. Department of Health and Human Services (HHS) officials lacked a contingency plan for the Navigator and Assister program after HealthCare.gov failed, leaving consumers open to the risk of identity theft due to confusion surrounding enrollment for health exchanges.

Key Findings:

- Navigators Were Unprepared for Website Crash and Lacked a Contingency Plan: In a Committee briefing, Gary Cohen, a top HHS official admitted that Navigators lacked direction in the early days because “it took a while to know what was happening.” Also during the briefing, another HHS official, Mandy Cohen, stated that “it seems like in hindsight,” there should have been contingency plans for the website’s failure. HealthCare.gov “War Room” meeting notes, obtained by the Committee, show confused HHS officials struggling to advise Navigators about how to respond to the inoperable website. [4-5]

- Mountain Project, Inc., a Navigator grantee organization in North Carolina, has been collecting and mailing paper applications on behalf of applicants, in violation of Navigator rules and procedures: According to the Navigator Standard Operating Procedures Manual, “[navigators] may not mail applications for consumers.” Neither Mr. Gary Cohen, nor Ms. Cohen, nor Ms. Gottlich – the three HHS briefers – were aware of the report, despite the fact that Chairman Issa’s November 7, 2013 letter to Secretary Sebelius regarding problems with the Navigator and Assister programs discussed it at length. [3]

- During the November 21, 2013 committee staff briefing, Mr. Cohen stated that he did not anticipate tax fraud to be an issue, despite numerous questions from the Committee in letters to Secretary Sebelius, at a congressional hearing, and in a transcribed interview: Mr. Cohen admitted there is a need for better training on the issue through the ongoing education process, and he did not ruling out requiring Navigators to report tax fraud in the future. To date, however, the Administration has not taken the necessary steps to prevent this type of tax fraud. [5-6]

- Lax Oversight at HHS Fails to Ensure Organizations Report Navigator Misconduct. HHS officials responsible for the navigator program did not learn of the below incidents from internal oversight procedures, but rather from news reports:

Navigators from the Urban League of Dallas were captured on video, encouraging applicants to lie on their health insurance application so the applicants could qualify for tax subsidies. Navigators were also recorded advising an applicant to lie about her smoking habits to obtain a lower monthly premium. It was later discovered that two of the so-called navigators involved in the incident were assisting consumers with their applications even though they had not completed their training and certification requirements. The navigator organization in question fired one navigator, and suspended two others. [2]

One self-identified Navigator gave a television interview in which she told viewers blatantly incorrect information: that applicants’ credit scores could impact their eligibility for certain plans. [3]