A recent report from the Government Accountability Office (GAO) has shed light on rampant fraud and systemic failures within the Affordable Care Act marketplace.
This revelation comes at a time when Congress is embroiled in a dispute over the future of Obamacares enhanced premium subsidies.
According to the Western Journal, the GAO report, published on Wednesday, disclosed that fictitious identities, invalid Social Security numbers, and even deceased individuals were effortlessly approved for taxpayer-funded subsidies. Astonishingly, every single application investigators submitted using fabricated or invalid Social Security numbers in 2024 was approved for coverage.
"Republicans have sounded the alarm on the flawed structural integrity of Obamacare and how Democrats failed policies to temporarily prop up the program have exacerbated fraud, hurt patients, increased the burden on American taxpayers," stated Rep. Brett Guthrie, a Republican from Kentucky and chairman of the Energy and Commerce Committee.
Guthrie further emphasized the importance of the GOP's efforts to strengthen, secure, and sustain federal health programs. He believes these efforts are crucial to ensure access to quality health care at prices Americans can afford.
The recent government shutdown, which ended just before Thanksgiving, was largely due to Democrats refusal to compromise on the expiring Obamacare premium subsidies. These subsidies, passed without a single Republican vote in 2021, are set to expire at the end of 2025.
Originally, these subsidies were limited to households earning between 100 percent and 400 percent of the federal poverty level. However, Democrats removed the upper income cap, increased the subsidy amounts, and in some cases, reduced premiums to zero.
Fraud is particularly rampant among enrollees reporting incomes between 100 percent and 150 percent of the federal poverty level, who qualify for zero-premium plans. Critics argue that zero-premium plans create opportunities for fraudsters to sign up unsuspecting victims without their knowledge.
A joint report from the Foundation for Government Accountability and the Paragon Health Institute revealed that in nine states, the number of sign-ups at that income level exceeded the number of eligible residents.
The GAOs undercover investigation found that 100 percent of the fictitious applications it submitted were approved in late 2024, and 18 out of 20 fake applicants were still receiving subsidized coverage for 2025. ACA marketplaces approved coverage even when no documents were requested, or fake documents were submitted, including those related to the applicants citizenship status.
The government watchdog also discovered 66,000 Social Security numbers with more than a years worth of subsidized coverage in 2024, including one number used for the equivalent of 71 years of coverage in a single plan year.
The Centers for Medicare and Medicaid Services, which manages the ACA marketplace, does not block new applications using the same Social Security number, as per the report.
Moreover, 58,000 SSNs receiving benefits in 2023 matched Social Security death data, resulting in $94 million in taxpayer-funded subsidies being sent to health insurers on behalf of deceased individuals.
Judiciary Committee Chairman Jim Jordan expressed his disappointment, stating, For years, we were told we could keep our plan, keep our doctor, and premiums would go down. None of it happened. This new report confirms what we already knew: under Obamacare, hardworking Americans saw their premiums skyrocket and their healthcare choices shrink, all while fraud benefited insurance companies.
Democrats, on the other hand, caution that without extending the expanded subsidies, millions of Americans will face steep premium hikes and loss of coverage.
ACA premiums are projected to rise by 20 percent on average in 2026, but Paragons earlier analysis found that the expiring subsidy would account for just 3.3 percent of those premiums.
The group also discovered that Obamacare plan premiums have grown nearly twice as fast as employer-sponsored plans since the ACA took effect. This revelation underscores the urgent need for a comprehensive review and reform of the current system to ensure that it serves the best interests of the American people.
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