A new GAO undercover investigation reveals that the Affordable Care Act’s exchanges are profoundly vulnerable to fraud.
- Across plan years 2024 and 2025 GAO created 20 fictitious identities and submitted 24 applications. The exchanges enrolled 23 of 24 fictitious applications.
- The exchange frequently did not request documentation and approved coverage even when documentation was not submitted, not credible, or internally inconsistent.
- For plan year 2025, 19 of 20 fictitious applicants received subsidized coverage, and coverage for 18 fictitious enrollees remained as of September 2025. The only one not to receive subsidized coverage was because a broker would not return the fictious applicant’s messages.
- Under the ACA, individuals who receive advance premium tax credits (APTC) must file a federal tax return and reconcile their subsidy (which is based on estimated income) with their actual income. GAO reported “we could not identify evidence of reconciliation in tax data for over $21 billion in APTC” for enrollees with Social Security numbers in the 2023 plan year.
- That means nearly one-third of APTC paid to individuals with Social Security numbers was not matched with a tax return showing reconciliation. In practical terms, CMS has no confirmation that tens of billions of dollars in payments were correct.
- GAO found over 66,000 SSNs showed more than 366 days of coverage in a 2024, including one SSN with “over 26,000 days… across over 125 insurance policies” in 2023.
- Subsidies for the deceased: More than 58,000 SSNs receiving subsidies matched Social Security death records.
The GAO investigation confirms problems that Paragon’s research has quantified. Specifically, Paragon estimates 6.4 million improper exchange enrollees in 2025—at a cost to taxpayers of $27 billion in 2025.
