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July 27, 2015 at 08:23 AM
(Bloomberg View) — While the Patient Protection and Affordable Care Act (PPACA) — Obamacare — is still a long way from providing insurance to every American who needs it, the program is apparently pretty good at covering people who don’t exist.
See also: GAO: HealthCare.gov lets fake people re-enroll
Eleven out of 12 fictitious people obtained coverage, plus federal subsidies to help them pay for it, in a test of Obamacare’s anti-fraud measures conducted by the U.S. Government Accountability Office (GAO). And all 11 of those nonpeople were automatically re-enrolled for the following year. Some even got bigger subsidies.
Given that the subsidies for Americans buying health insurance on state and federal exchanges are projected to reach $100 billion annually by 2025, the potential for fraud that the GAO has uncovered is intolerable.
How could it happen? To qualify for subsidized Obamacare coverage, you need to be a citizen or legal immigrant, with income below 400 percent of the federal poverty level. Supposedly, the government verifies each applicant’s Social Security number, citizenship status and other information. Yet when the GAO investigators made their fake applications using bogus or incomplete documents, or no documents at all, they were able to sign up, obtaining about $30,000 in annual federal subsidies.
The weak link, the GAO concluded, was phone registration. People who call in to sign up don’t need supporting documentation. The U.S. Centers for Medicare & Medicaid Services (CMS), which is responsible for the exchanges, is supposed to request that information later, but those requests weren’t always clear. And when the GAO’s fictitious applicants provided no documents, they got subsidies anyway.
