Fake Identities Still Approved for Obamacare Subsidies, Watchdog Warns of Systemic Failures

By Nicholas Ballasy | Just the News

"We were able to get subsidized insurance for fake enrollees. We also found some issues with enrollees' Social Security numbers that could indicate identity fraud. The program's fraud risks were last assessed in 2018, even though the program and its risks have since evolved,” the GAO reported

A newly released report from the Government Accountability Office reveals that “fraud risks in the advance premium tax credit (APTC) persist,” despite earlier warnings and reforms. 

The APTC is a “subsidy that the government pays to insurance companies to make premiums more affordable for eligible Americans under the Affordable Care Act.” CMS paid nearly $124 billion in APTC in 2024 alone, covering about 19.5 million enrollees. 

“So far, we’ve found that fraud risks have persisted since we first reported on this (2014-2016),” read the GAO’s summary of the findings in the report.

“For example, we were able to get subsidized insurance for fake enrollees. We also found some issues with enrollees’ Social Security numbers that could indicate identity fraud.  The program’s fraud risks were last assessed in 2018, even though the program and its risks have since evolved,” the GAO added.

Fraud Tests with Fake Identities Are Still Getting Approved

As part of its investigation, GAO submitted “fictitious applications” to the federal marketplace for plan years 2024 and 2025. 

“The federal marketplace approved coverage for nearly all of GAO’s fictitious applicants in plan years 2024 and 2025, generally consistent with similar GAO testing in plan years 2014 through 2016,” the GAO said.

All four fake applicants in 2024 were approved, and the federal government paid roughly $2,350 per month in premiums for each one. 

For 2025, 18 out of 20 fictitious identities remain actively covered as of September, collectively receiving over $10,000 per month in subsidies. 

These tests demonstrate that fraudulent enrollments with invalid Social Security numbers can still gain approval and receive taxpayer-funded subsidies.

GAO said the current findings are similar to earlier tests that were conducted from 2014–2016.

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