The Government Accountability Office (GAO) has recently revealed findings of substantial fraud within the Affordable Care Act (ACA), commonly known as Obamacare. The comprehensive audit uncovered various irregularities, including the issuance of subsidies to deceased persons, applicants without proper documentation, and fictitious enrollees. These revelations have raised serious concerns regarding the structural integrity of the healthcare program and its susceptibility to fraudulent activities.
Senate Finance Committee Chairman Mike Crapo (R-ID) has pointed to structural weaknesses, which were exacerbated by temporary subsidy increases during the COVID-era, as a key reason for the rampant fraud. According to Crapo, these issues have caused fraudulent activities to proliferate, leaving taxpayers to foot the bill for criminals and unscrupulous insurance brokers.
In a striking display of the program's vulnerabilities, the GAO successfully enrolled fake identities into the system, with every fraudulent applicant in 2024 being approved for coverage. By 2025, 18 of these 20 fictitious enrollees remained covered. These findings were part of a controlled test conducted by the GAO to assess the robustness of the program's fraud prevention measures.
The Centers for Medicare & Medicaid Services (CMS) paid an average of over $2,350 per month in premium tax credits for these fictitious enrollees in 2024. The GAO report highlighted incidents where coverage was approved even when applicants submitted falsified income proofs or Social Security numbers, and in some cases, when no verification documents were submitted at all.
Investigators discovered that in 2024 alone, 66,000 Social Security numbers were used to obtain insurance coverage for more than one year, including one number that was associated with 125 separate policies in 2023. Furthermore, approximately $94 million in subsidies were issued for individuals recorded as deceased, with federal records later confirming that at least 58,000 of these Social Security numbers matched death data.
Identity misuse, however, was only one facet of a broader problem identified by the GAO. The report also found that nearly 160,000 applications were likely altered by brokers without the enrollee’s consent in 2024, leading to more than 270,000 complaints from Americans who stated they were enrolled or switched into plans against their will.
These unauthorized changes have had significant consequences for patients, causing disruptions in medication access and allowing brokers to siphon off improper fees. House Ways and Means Chairman Jason Smith has expressed frustration over the "smoking gun" findings, which he says prove billions in improper payments and the subsequent harm to patients facing higher healthcare costs and denied or delayed care.
In 2024, the ACA program distributed approximately $124 billion in premium tax credits across 19.5 million enrollees. However, congressional and external estimates suggest that improper enrollments could be costing taxpayers up to $27 billion annually.
The GAO has also found that the fraud risk assessments for the ACA have not been updated since 2018, despite changes to the program. The report urges federal officials to implement a comprehensive anti-fraud strategy to prevent further waste of taxpayer dollars.
