NCPA - National Center for Policy Analysis

Government Report: Getting Fraudulent Health Care Subsidies is Easy

July 24, 2014

On January 1, 2014, former HHS Secretary Kathleen Sebelius wrote a letter to President Obama certifying that the health care exchange would verify applicants' information in order to determine whether applicants were eligible for tax credits and cost-sharing reductions.

But Peter Suderman at reports that, if there was a system in place, it doesn't work.

Investigators from the Government Accountability Office (GAO) attempted to determine whether it was possible to fraudulently apply for Obamacare subsidies. The investigators created false names and Social Security numbers, claimed legal residence and submitted health insurance applications with incomes that were too high to qualify for subsidies.

Yet, the majority of their attempts were successful, and the GAO is still paying its monthly premiums on these accounts. Applications were made online and over the phone, and of the six telephone attempts made by investigators, five were accepted. (The only rejection took place when the GAO investigator refused to supply a Social Security number at all.)

These results, says Suderman, would indicate that there is, in fact, no verification system in place to determine whether Americans are actually eligible for Obamacare subsidies. The Associated Press has written that the inability of individuals to access subsidy funds directly may limit the potential for fraud.

Source: Peter Suderman, "Government Watchdog Report Shows How Easy It Is to Fraudulently Access Subsidies Under Obamacare,", July 23, 2014.


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