Uncovering Widespread Fraud in Obamacare

Floor Speech

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Ms. FOXX. Mr. Speaker, I rise to include in the Record a copy of the article, ``Ghostbusting ACA Fraud: Millions Who Don't Use Their Health Insurance Expose Abuse in the Program'' and a document from the Committee on Ways and Means entitled ``Watchdog Report Uncovers Widespread Fraud in Obamacare.'' [From Paragon Health Institute, Oct. 1, 2025] Ghostbusting ACA Fraud: Millions Who Don't Use Their Health Insurance Expose Abuse in the Program (By Niklas Kleinworth, Liam Sigaud, and John R. Graham)

Individual coverage exchange plans created by the Affordable Care Act (ACA) have a glaring problem: nearly 12 million enrollees, or 35 percent of all exchange enrollees in 2024, do not use their benefits at all. For these enrollees, known as zero-claim enrollees, health coverage did not translate to health care. Many zero-claim enrollees are known as ``phantoms''--people who are enrolled but not practically in the market because they are enrolled in other coverage or are unaware of their exchange plan coverage. Large insurers benefit greatly from phantom enrollment, as they collect billions of dollars in taxpayer funds to cover individuals who cost them nothing.

Our analysis shows that these enrollees are not just healthy enrollees with no need for care. They are part of a larger story about how Biden COVID credits are driving perverse incentives. Insurers and middlemen are responding to these incentives, and unscrupulous brokers are enrolling anyone they can. Evidence shows millions of Americans fell victim to enrollment in fully subsidized plans without their knowledge or consent. This fraud harms patients who lose their health coverage or face penalties at tax time. It also harms taxpayers who foot the bill for these schemes.

This policy brief presents a state-by-state analysis describing how zero-claim enrollment corroborates much of Paragon's previous work on improper enrollment and fraud in the ACA exchanges. We also debunk claims that young, healthy enrollees without claims are serving to diversify the risk pool and improve the market. KEY TAKEAWAYS

Rising numbers of zero-claim enrollees--people who did not file a single medical claim--bolster evidence of rampant fraud in ACA exchanges. Many of these enrollees are phantoms--people unaware of their coverage or enrolled in other plans.

Biden COVID credits drove fraud by creating zero-dollar plans that are fully subsidized by taxpayers and require no enrollee contributions. Unscrupulous brokers enrolled many people without their knowledge and many others after manipulating information on applications to maximize subsidies.

The sharp increase in zero-claim enrollment from 2021 to 2024 is not explained by meaningfully higher enrollment among young, healthy beneficiaries.

Zero-claim enrollment numbers dwarf potential coverage loss estimates of not extending the COVID credits. This anomaly suggests that when the COVID credits expire on schedule at the end of 2025, they will likely have little to no negative effect on access to health care services or health.

To curb fraudulent enrollment that harms both patients and taxpayers, Congress must allow the Biden COVID credits to expire on time. ____ [From the United States House Committee on Ways & Means] Ways and Means: Watchdog Report Uncovers Widespread Fraud in Obamacare

Fraud prevention failures in Obamacare lead to insurance subsidies for fake enrollees.

Initiated by a Ways and Means, Energy and Commerce, and Judiciary request in 2024, the Government Accountability Office (GAO) led a covert operation resulting in fictitious applicants receiving Obamacare subsidies.

100 percent of the fake applicants were approved for subsidies in 2024.

18 out of 20 (90 percent) fake identities remain enrolled and subsidized in 2025, proving the system cannot detect fraudulent identities.

Marketplaces approved coverage even when required documents were never submitted or when GAO submitted fake documentation.

This includes fake proof-of-citizenship, validating concerns that taxpayers have been subsidizing illegal immigrants.

Monthly subsidies paid to health insurers on behalf of GAO's fake identities exceeded $12,300 per month.

Data analysis shows widespread systemic fraud with taxpayers on the hook for costs.

In 2023, one SSN was used to enroll in more than 125 different insurance policies, accumulating over 26,000 days of subsidized coverage--the equivalent of 71 years.

66,000 SSNs in 2024 had more than a year's worth of subsidized coverage, meaning multiple SSNs were being reused across different policies.

$21 billion in subsidies were paid out with no evidence of tax reconciliation for 2023--meaning 32 percent of all subsidies paid to enrollees with SSNs had no confirmation of repayment, or verification signaling likely massive improper payments.

Insurers collect subsidies for deceased individuals through unauthorized plan switches.

58,000 SSNs receiving subsidies matched Social Security death records.

At least 7,000 were dead before coverage even began, insinuating identities were used by fraudsters.

$94 million in taxpayer-funded subsidies were sent to health insurers on behalf of deceased individuals.

Bad actors engaged in unauthorized enrollment activity to chase commissions, resulting in:

160,000 likely unauthorized changes by three or more brokers in 2024.

CMS itself received 275,000 complaints in just eight months (January to August 2024) from Americans who were enrolled in or switched into plans without their consent.

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