The Journal penned a July 12 editorial entitled, The Rising Costs of the Non-Affordable Care Act. Based on updated CBO estimates, the cost of the ACA’s coverage provisions will be $2.7 trillion over the next decade. And that assumes that the enhanced Obamacare subsidies to health insurers expire after 2025 as they are slated to do and as we strongly recommend happen. Extending them would cost another $400 billion and create a host of other problems, including more small employers dropping coverage. The Journal referenced Paragon’s report and our findings on how rampant fraud is one reason why costs have increased:
The Administration also revised regulations that eliminated multiple-income verification requirements, making it easier for people to qualify for subsidies. According to a new paper by Paragon Health Institute, millions of enrollees misreport their incomes and receive more subsidies than they should.
The number claiming income between 100% and 150% of the federal poverty line—those who are eligible for subsidies that fully cover premiums and most cost-sharing—exceed the number of potential enrollees in nine states. Paragon Health estimates the cost of the fraudulent enrollment at between $15 billion and $20 billion this year alone. Ouch.
The Paragon Pic below shows those nine states and the percentage of sign-ups who report income between 100 percent and 150 percent of FPL compared to the number of people we estimate are eligible for exchange plans in that income category.
A New York Post editorial also cited The Great Obamacare Enrollment Fraud as well as the letters by the Chairs of three powerful U.S. House Committees—Energy and Commerce, Ways and Means, and the Judiciary—to government watchdog agencies to open an investigation into the fraud and causes of it. The New York Post editorial concludes:
Paragon’s researchers offer several recommendations to curb the “waste, fraud and abuse” — such as reversing Biden policies that enable “widespread fraudulent enrollment, particularly the “continuous open-enrollment period for people” claiming income below the threshold.
Yet none of its suggestion are as important as allowing the Biden-era “enhanced subsidies” to simply expire next year. These subsidies already total nearly $40 billion a year — part of $2 trillion in annual federal outlays for health care.
And they’re clearly an invitation for fraud.
Senator Grassley, one of Congress’s most aggressive conductors of oversight, has also taken notice of Paragon’s findings, citing our work in a letter to HHS Secretary Becerra and Chiquita Brooks-LaSure, the administrator of the Centers for Medicare and Medicaid Services (CMS). In two weeks, Paragon will be releasing a follow-up report that provides more detail on the perpetuation of the fraud.
