Senate Majority Chief John Thune, a Republican from South Dakota, throughout a information convention following the weekly Senate Republican coverage luncheon on the Capitol in Washington, Nov. 19, 2025.
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As lawmakers’ debate over Reasonably priced Care Act enhanced premium subsidies continues, Republicans have pointed to experiences of fraud within the medical insurance market as a motive they should not lengthen the tax break.
GOP lawmakers cited a Dec. 3 report from the U.S. Authorities Accountability Workplace, a nonpartisan congressional watchdog, on fraud tied to ACA subsidies.
Democrats’ proposal to increase the ACA enhanced credit “is rampant — and I say rampant — with fraud and abuse,” Senate Majority Chief John Thune, R-S.D., said on the Senate flooring Thursday.
Some well being coverage specialists say the scope of the fraud is not as extreme as lawmakers have instructed, and that it might be higher to enhance the ACA’s safety measures quite than minimize enhanced subsidies altogether.
“It truly is trivial, the scope of fraud,” stated Michael Gusmano, a professor of well being coverage at Lehigh College. “It is only a scare tactic to justify the discount of the federal authorities’s position in subsidizing medical insurance,” he stated.
He pointed to at least one discovering for example: In 2023, greater than 58,000 Social Safety numbers of deceased individuals additionally obtained a premium subsidy, in response to the GAO. That amounted to simply 0.4% of all Social Safety numbers that obtained a premium tax credit score that 12 months, the GAO discovered.
Republicans cite ACA fraud as obstacle
Senate Democrats proposed to increase enhanced ACA subsidies — attributable to expire at year’s end — for 3 extra years. These subsidies decrease insurance coverage premiums for ACA enrollees.
About 22 million individuals, or 92% of ACA enrollees, obtain the subsidies, in response to KFF, a nonpartisan well being coverage analysis group. KFF estimates recipients’ insurance coverage premiums will greater than double in 2026 with out them, on common.
Republicans proposed a plan that will enable the improved ACA subsidies to run out. They might as a substitute subject funds of as much as $1,500 to shoppers with health savings accounts.
Each measures failed within the Senate on Thursday.
Home Speaker Mike Johnson, R-La., stated Tuesday that he won’t call a vote to increase enhanced ACA subsidies, making it a close to assure that they’ll expire as scheduled.
Republican lawmakers cited fraud as a key motive to not lengthen the subsidies.
“We are going to by no means have a aggressive market when that market is riddled with fraud,” Sen. Invoice Hagerty, R-Tenn., said Thursday.
The GAO report outlined varied channels of fraud involving ACA subsidies obtainable via the federal market, which is utilized by about 30 states. The remaining function their very own marketplaces.
“Once you have a look at [the] info of this report, the depth of the negligence turns into simple,” Rep. Jefferson Van Drew, R-N.J., chairman of the Home Judiciary Subcommittee on Oversight, stated throughout a hearing Wednesday on ACA subsidy fraud.
The report comes as President Donald Trump and Republicans have just lately lashed out over fraud in different profit packages.
For instance, President Trump has just lately said he doesn’t want Somali immigrants within the U.S., calling Minnesota, the place there’s a giant Somali inhabitants, “a hub of fraudulent cash laundering exercise.” Most of the alleged perpetrators of a collection of fraud scandals tied to social security internet packages in that state, estimated to probably value more than $1 billion, are Somalis.
The late Sen. John McCain (R-AZ) leaves the Senate Chamber after a vote on a stripped-down, or ‘Skinny Repeal,’ model of Obamacare reform on July 28, 2017 in Washington, DC. McCain was certainly one of three Republican Senators to vote in opposition to the measure.
Zach Gibson | Getty Pictures Information | Getty Pictures
Republicans have additionally tried to dismantle the ACA since its early days. This 12 months, a multibillion-dollar GOP package deal of tax cuts generally known as the “massive lovely invoice” made a number of administrative tweaks to the ACA; greater than 3 million individuals are expected to lose coverage over the next decade in consequence.
In 2017, a Republican measure to repeal and exchange the ACA failed after a dramatic “no” vote from three GOP defectors, together with the late Sen. John McCain of Arizona.
GAO report discovered pretend individuals bought ACA subsidies
By means of covert testing, the GAO submitted fictitious functions by way of the federal ACA market in 2024 and 2025.
The federal market accepted all 4 pretend functions the GAO submitted in 2024, collectively amounting to $2,350 per 30 days in premium subsidies that had been paid on to insurers, the report stated.
In 2025, the GAO submitted one other 20 fictitious functions; 18 of them had been accepted and nonetheless lively as of September 2025, the report stated. Their mixed premium subsidies paid to insurers had been greater than $10,000 per 30 days, it stated.
The findings counsel “enrollment management weaknesses,” the GAO wrote.
Nonetheless, the findings cannot be generalized to the universe of ACA enrollees and are in keeping with the outcomes of comparable testing performed in 2014 via 2016, in response to the GAO.
Subsidies have been obtainable since 2014, within the early days of the Reasonably priced Care Act, also referred to as Obamacare. The subsidies, referred to as premium tax credit, had been enhanced in 2021, making the credit score extra priceless and obtainable to extra households.
“My foremost takeaway from the report is that fraud has been a constant downside for the federal Market, as we’d count on for any federal program the place substantial subsidy {dollars} are concerned,” Kaye Pestaina, director of KFF’s program on affected person and client safety, wrote in an e-mail.
“It isn’t small, however the GAO report doesn’t point out that that is an outlier when in comparison with fraud in different federal packages,” she wrote.
Fraud tied to Social Safety numbers
In 2023, greater than 58,000 Social Safety numbers of deceased individuals additionally obtained a premium tax credit score, in response to the GAO.
It is unclear what number of of these individuals might have legitimately certified for the subsidies after which subsequently died, Gusmano stated.
Moreover, there have been situations of Social Safety numbers getting used greater than as soon as to use for advantages. The GAO discovered greater than 29,000 Social Safety numbers with greater than one year of insurance coverage protection with ACA subsidies in 2023, and about 66,000 in 2024.
Speaker of the Home Mike Johnson, R-La., discusses rising medical insurance premiums as Home Majority Chief Steve Scalise, R-La., left, and Home Majority Whip Tom Emmer, R-Minn., look on throughout a press convention within the Capitol Constructing in Washington, Dec. 10, 2025.
Heather Diehl | Getty Pictures
Nonetheless, the uncooked numbers are deceptive, stated Gusmano of Lehigh College. They masks that the numbers symbolize a small share of general subsidy recipients, he stated.
For instance, along with the info about lifeless people amounting to 0.4% of all Social Safety numbers that obtained a premium tax credit score in 2023, circumstances of a number of makes use of of Social Safety numbers amounted to 0.2% of all numbers in 2023 and about 0.4% in 2024, GAO discovered.
“I do not suppose they’ve uncovered large fraud and abuse,” Gusmano stated. “Some issues look instantly like scary numbers in case you ignore the denominator.”
Even for many who suppose the fraud is substantial, an affordable response could be to make reforms to the system to cut back waste quite than enable the improved subsidies to run out, Gusmano stated.
“The concept you get right down to zero when it comes to any form of downside with any system, if we utilized that to any program, public or personal, they’d all must shut down,” he stated. “That is a deeply problematic customary.”
Senate Minority Chief Chuck Schumer, a Democrat from New York, throughout a information convention following the weekly Senate Democrat coverage luncheon on the US Capitol in Washington, DC, on Dec. 2, 2025. Likelihood is growing that Obamacare subsidies will expire on the finish of the month and set off a spike in medical insurance premiums as a impasse in Congress deepens on the difficulty.
Graeme Sloan/Bloomberg by way of Getty Pictures
The damaging monetary penalties for households and impacts on public well being of not extending the subsidies far outweigh the losses from fraud, specialists stated.
The typical subsidy recipient would see their out-of-pocket premium funds enhance to about $1,900 in 2026 from almost $900 in 2025 if enhanced subsidies disappear, in response to KFF. Many households would lose help altogether. About 4.8 million individuals are expected to drop their well being protection subsequent 12 months if enhanced subsidies expire, in response to the City Institute.
I do not suppose they’ve uncovered large fraud and abuse.
Michael Gusmano
professor of well being coverage at Lehigh College
Nick Fabrizio, a well being coverage knowledgeable and affiliate instructing professor at Cornell College’s Jeb E. Brooks Faculty of Public Coverage, stated the U.S. ought to lengthen the subsidies for 2026.
Nonetheless, in contrast to the Democrats’ proposal, an extension ought to be tied to reforms to throttle again the scope of fraud within the federal market and to place a lid on ballooning prices within the broader health-care system, he stated.
“We’re in a type of conditions the place now we have to increase the subsidies,” he stated. “We have now no different alternative. However now we have to stabilize the system. … We have now to fulfill someplace within the center.”
ACA fraud threat will increase as program grows
A big governmental program is certain to have some degree of fraud or corruption, Fabrizio stated.
The GAO report notes that fraud dangers are prone to enhance because the ACA subsidies develop, and that the Facilities for Medicare & Medicaid Companies hasn’t up to date its fraud threat evaluation since 2018, earlier than enhanced ACA subsidies grew to become obtainable.
For instance, CMS estimated that the premium tax credit score totaled about $124 billion in 2024, greater than double the $53 billion in 2018, in response to the report.
That development might warrant further fraud controls, it stated.
“There may be fraud in each insurance coverage program that I’ve ever studied,” stated Gerard Anderson, a professor of well being coverage and administration on the Johns Hopkins Bloomberg Faculty of Public Well being. “If there’s cash to be made performing some degree of fraud, individuals will benefit from it.”
Anderson stated he thinks the federal government ought to tweak some parameters of the ACA subsidy system.
For instance, enhanced subsidies enable sure low-income ACA enrollees to get medical insurance with $0 premiums. CMS has recognized such zero-premium plans as a possible pathway to fraud; insurance coverage brokers can enroll individuals in plans with out their information and gather a fee from insurers within the course of.
Implementing even a small premium would scale back such fraud, Anderson stated.
“I believe it is best to all the time tweak the parameters of the system,” he stated. “It is applicable to make revisions as a result of you’ll be able to’t anticipate the whole lot that is going to occur.”
