Nonpartisan Gov’t Watchdog Warns Obamacare Marketplaces Still “Vulnerable to Fraud”

Undercover Testing Shows Eligibility Determination and Enrollment Processes Still Lack Real Safeguards

WASHINGTON, D.C. – The nonpartisan Government Accountability Office (GAO) today released two undercover reports of the Obamacare marketplace with testing results for the 2015 and 2016 coverage years.

In the 2015 coverage year analysis, GAO found that “the federal Health Insurance Marketplace (Marketplace) or selected state marketplaces approved each of 10 fictitious applications GAO made for subsidized health plans.” Additionally, for eight additional fake applications, GAO was approved for subsidized insurance in all but one case.

GAO summarized its 2016 findings by saying, “As previously reported for the 2014 and 2015 coverage years, GAO’s undercover testing for the 2016 coverage year found that the health-care marketplaces’ eligibility determination and enrollment processes remain vulnerable to fraud.”

“As if Obamacare’s recent headlines were not damning enough, we find out today that the Obama Administration continues to fail the test when it comes to enrollment verification,” said Senate Finance Committee Chairman Orrin Hatch (R-UT). “Continuing to leave taxpayers vulnerable, years after the system was implemented, is a disgraceful way for the administration to leave our healthcare system. That the administration has been aware of this since 2014, and has failed to employ proper safeguards, is just the latest incompetence in the health law’s implementation. It is no surprise examples like this have become the legacy of Obamacare.”

“This report unfortunately tells us more of what we already know — that the Obamacare federal exchanges have been riddled with problems since day one,” said House Ways and Means Committee Chairman Kevin Brady (R-TX). “The fact that the exchanges are so susceptible to fraud is just further proof that the President’s health care law is not working as promised — and wasting billions of taxpayer dollars in the process. House Republicans have proposed a better, simpler way to help individuals and families access quality, affordable care and also protect taxpayer dollars.”

“When a fire is raging, the first thing you do is grab a hose – but there is no urgency by the administration to address the inferno of fraud. It’s déjà vu all over again as it seems the situation only continues to get worse, and we all are paying the price,” said House Energy and Commerce Committee Chairman Fred Upton (R-MI). “The nonpartisan watchdog reports underscore that there is still tremendous weakness in how the federal marketplace operates and immediate action must be taken to ensure all avenues for fraud are impossible.”

GAO has issued eight recommendations to CMS to strengthen their oversight over the federal marketplace.

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