The idea that Affordable Care Act marketplaces are riddled with fraud has become a major talking point among Republicans, as lawmakers in Congress argue about whether to extend the enhanced tax credits that are helping offset the cost of health care marketplace coverage for low- and middle-income people. Those ACA subsidies expire at the end of the year and have become a flash point in the government funding showdown.
“The tax credits go to some people deservedly. And we think the tax credits actually go to a lot of waste and fraud within the insurance industry,” said Vice President JD Vance during a recent interview on CBS News. “We want to make sure that the tax credits go to the people who need them.”
Key to the Republican argument of widespread fraud is a report published in August by the Paragon Health Institute, a Republican-aligned think tank. The report focuses on “phantom enrollees” in the ACA marketplaces.
Paragon president Brian Blase said these “phantom enrollees,” who don’t use any medical care in a year, exceed the percentages of “what you would expect in a normal, functioning health insurance market.”
Blase and his team say they have quantified the percentage of zero-claim enrollees in the ACA marketplace by analyzing Centers for Medicare & Medicaid Services data released in August.
This highlights one of the central issues with the CMS data: It tracks the number of plan enrollments rather than individual …