Last December the GAO issued a report stating that they had found evidence the Affordable Care Act was rife with fraud. GAO investigators had created fake identities and then signed up for benefits to see whether or not these applications would be approved. Nearly all of them were.
To perform covert testing of federal Marketplace enrollment controls, we created 20 fictitious identities and submitted applications for individual health care coverage in the federal Marketplace...
Our covert testing of enrollment controls in the federal Marketplace suggests weaknesses have persisted since our tests in plan years 2015 through 2016. All four of our fictitious applications received subsidized coverage through the federal Marketplace in late 2024. Additionally, although our work is ongoing, as of September 2025 18 of our 20 fictitious applications for plan year 2025 were receiving subsidized coverage.
With that in mind, an anti-fraud task force led by Vice President Vance has been looking into ACA enrollment. Today, Vance announced plans to remove about 760,000 people from the rolls, saving the government more than $2 billion dollars.
Tuesday’s enforcement action, directed by the Vance-led White House Task Force to Eliminate Fraud, represents one of the largest administrative purges targeting individual insurance exchanges since the Trump administration’s crackdown on fraud began last year.
Vance and Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, or CMS, are set to announce they are canceling subsidy payments for allegedly unauthorized and fraudulent enrollments in the ACA, also known as Obamacare, for 760,000 individual accounts, according to administration officials. They say those cancellations would amount to saving an estimated $2.2 billion in taxpayer funds.
Officials said those enrollments include people who are unaware that they are enrolled in the program, are ineligible for the program because they have employer-provided healthcare or earn an annual income greater than 400% above the federal poverty level.
In short, this appears to be rampant fraud. The backstory here is that under the Biden administration Democrats passed bills to expand eligibility for Obamacare insurance subsidies. At the time, this was said to be an emergency based on the pandemic. The result was that enrollment in the ACA jumped from around 10 million people to roughly double that number. It turns out people are eager to accept free money.
But the cost of that expanded eligibility was significant which is why Democrats initially only put it in place for two years (in 2021) and then expanded it for three additional years (in 2022). What they did not do was make it permanent because they had no way to pay for all that spending at a time when government spending was running rampant and concern about inflation was rising.
The result was that the free money was set to run out at the end of 2025. And as you may recall, that's when Democrats, led by Chuck Schumer, began shutting down the government to demand that President Trump extend those subsidies indefinitely. All of the language you heard about Trump raising premiums and cutting people off from healthcare was really just the plan Democrats had put in place themselves running out of money as they intended.
You may also remember that news outlets did a terrible job placing the blame for the expiration of benefits where it belonged. In fact, the Washington Post is still doing a terrible job describing what happened in its story published today.
About 19 million people are enrolled in health plans offered through the ACA’s exchanges, HHS officials said in June. Enrollment in the program, which shot up under President Joe Biden, has shrunk by more than 1 million people since President Donald Trump took office and is expected to fall by millions more this year...
Democrats and some health policy experts have argued that Trump’s polices, including ending coronavirus-era subsidies that widely lowered the cost of ACA coverage, have forced people off the program and put them at risk of losing access to care.
Again, Trump didn't end "coronavirus-era subsidies" as this article claims. Those subsidies were set to end in 2025 by Democrats who didn't want to admit how expensive this was. All Republicans did was refuse to continue to subsidize the expansion, something Democrats had claimed was a COVID-era emergency, not a permanent expansion. Most people reading the Post's coverage won't get that from the text.
In any case, the 760,000 fraudulent enrollments may be just the tip of the iceberg for this program. Some have suggested the rate of fraud is much higher.
Brian Blase, the founder of the Paragon Health Institute, a conservative think tank that has driven attention on ACA enrollment fraud, welcomed the administration’s move.
The think tank estimated earlier this year that about 6 million ACA enrollees were fraudulent, a number that includes “phantom enrollees” either unaware they’d signed up or fabricated by brokers.
Hopefully this is just the start of efforts to weed out fraud.
