a national transaction application that has to dip into numerous other federal data sources
This statement alone is scarier, than whatever was leaked by Mr. Snowden. Surprisingly, the President's cheerleaders — normally so suspect of government's invasions into our privacy — ignore this implication.
It needs to verify you are who you say you are, that you are eligible under the law for various subsidies, that you are covered by the regs. For this I believe it has to dip into social security and IRS databases.