GAO report flags structural failures in Obamacare Marketplace fraud controls

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Obamacare Marketplace fraud controls

Highlights

GAO report finds ongoing structural gaps in Healthcare Marketplace enable unauthorized enrollment activities and plan switches, risking higher consumer copayments and loss of treatment access in 2024.
House committees cite potential improper Obamacare payments up to $27 billion annually, with GAO undercover testing showing fake identities consistently approved for subsidized coverage through late 2024 and 2025.
Confirmed complaints of unauthorized enrollments and switches surged over 450%, from 66,548 cases in 2023 to more than 300,000 by 2025, highlighting persistent system vulnerabilities.

GAO findings and congressional scrutiny

As reported by House Committee on Ways and Means, citing a Government Accountability Office review, structural gaps in the federal health insurance Marketplace continue to let unauthorized actors enroll consumers in coverage or switch their plans without consent. The report stems from requests by House committee leaders and expands on preliminary findings issued in December 2025.

GAO says the likely unauthorized changes in 2024 applications expose consumers to higher copayments and deductibles, as well as interruptions in access to treatment and medications. The investigation was requested by Ways and Means Committee Chairman Jason Smith, Energy and Commerce Committee Chairman Brett Guthrie, and Judiciary Committee Chairman Jim Jordan.

Smith says the report confirms inadequate safeguards in Marketplace enrollment, while Guthrie says committee scrutiny of ACA enrollment fraud has continued since June 2024. Jordan says the report validates longstanding concerns about fraud, improper enrollments and misuse of taxpayer funds in the program.

Broader payment risks and system vulnerabilities

House Republican leaders wrote to GAO in June 2024 seeking more detail on what they described as growing fraud in the Marketplace, and committee leaders followed up in November 2025 with questions about whether millions of enrollees may have been improperly enrolled. That follow-up cited potential improper payments of as much as $27 billion a year.

According to the text of the findings cited by the committees, GAO identifies systemic weaknesses that allow fake identities, deceased individuals and improper use of Social Security numbers to obtain Obamacare subsidies. In covert testing, GAO created fictitious identities using fake or never-issued Social Security numbers and still obtained subsidized coverage, with all fake applicants approved as recently as late 2024 and 90% continuing to receive coverage in 2025.

Confirmed consumer complaints of unauthorized enrollments and plan switches rose more than 450% in two years, from 66,548 in 2023 to more than 300,000 in 2025. The committees also say a 2024 CMS three-way verification call fix does not cover all transactions and still depends on identity checks that can be publicly available, leaving the system exposed to further abuse.

In our earlier article on the STOP Child Care Fraud Act, we covered how Senate Republicans proposed tighter verification, reporting, and oversight rules for the Child Care and Development Block Grant to curb misuse of federal child care funds. The measure, introduced by Senators Bill Cassidy and Tommy Tuberville, was framed as part of a broader push to reduce waste, fraud, and abuse across federally supported programs.

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