As Congress debates the future of enhanced premium subsidies for Obamacare, a critical report from the General Accounting Office (GAO) has surfaced, highlighting significant fraud and systemic issues within the Affordable Care Act (ACA) marketplace.
Released on Wednesday, the report unveiled that bogus identities, invalid Social Security numbers, and instances involving deceased individuals are frequently approved for taxpayer-funded subsidies. Strikingly, all applications submitted by investigators with false or invalid Social Security numbers were accepted for coverage in 2024.
Rep. Brett Guthrie, chairman of the Energy and Commerce Committee and a key figure behind the GAO investigation, remarked, “Republicans are raising concerns about the flaws in Obamacare’s structural integrity. The failed Democratic policies have not only exacerbated injustices but also harmed patients and increased costs for American taxpayers.” He emphasized that the troubling findings underscore the urgency of Republican efforts to secure and enhance federal health programs, ensuring that Americans have access to affordable and quality healthcare.
The recent government shutdown, which concluded just before Thanksgiving, was largely attributed to Democrats’ reluctance to negotiate on expiring Obamacare premium subsidies. These subsidies, originally enacted without any Republican support in 2021, were scheduled to end at the close of 2025.
Initially, these subsidies were intended for households with incomes ranging between 100% and 400% of the federal poverty level. However, Democrats have since raised the income limits, boosted subsidies, and in some cases, reduced premiums to zero.
The fraud findings stood out particularly among enrollees claiming incomes between 100% and 150% of the federal poverty line, qualifying for zero-premium plans. Critics suggest these zero-premium options provide an opening for unscrupulous individuals to sign up vulnerable victims without their knowledge.
According to a joint study, in nine states, enrollment numbers surpassed the eligible population within that income bracket. The GAO’s investigation demonstrated that all fictitious applications submitted were approved in late 2024, and 18 out of 20 of these fake applicants continued receiving subsidies in 2025. The ACA Marketplace was granting coverage approvals even in cases where no documentation was requested or when false documents were provided.
Further oversight identified 66,000 Social Security numbers that were eligible for subsidies for over a year in 2024, including instances of coverage spanning 71 years for a single plan year. The Centers for Medicare and Medicaid Services (CMS), which oversees the ACA marketplace, reportedly does not prevent new applications from using the same Social Security number.
Additionally, 58,000 Social Security numbers that received benefits in 2023 matched records from the Social Security death database, resulting in $94 million in taxpayer-funded subsidies being paid to health insurance companies for deceased individuals.
Judiciary Committee Chairman Jim Jordan expressed frustration: “For years, we were assured we could keep our plans, our doctors, and that premiums would decrease. None of that transpired. This new report reaffirms our belief that Obamacare has led to higher premiums and fewer healthcare options for hardworking Americans, while fraud has benefited insurance companies.”
CMS did not offer any comments regarding the report.
On the Democratic side, warnings have surfaced that without extending the expanded subsidies, millions could experience significant premium hikes and potential loss of coverage.
Predictions indicate that ACA premiums could rise by an average of 20% in 2026, while earlier analyses by Paragon highlighted that expiring subsidies would only account for 3.3% of projected premiums for that year. Since the implementation of Obamacare, premiums for these plans have reportedly increased nearly twice as fast as those for employer-sponsored insurance.
