Obamacare Insurance Markets Still Vulnerable to Fraud, Experts Say


By Maggie Fox

The Obamacare health insurance exchanges are still easily tricked by fraudulent applications, with fake Social Security numbers and bogus immigration details, more than a year after the weakness was first pointed out, officials say.

A Government Accountability Office sting also found that many people were double-covered by private insurance and Medicaid after signing up on the exchanges, and that others were allowed to mistakenly go without coverage.

“Our undercover testing for the 2015 coverage year found that the health care marketplace eligibility determination and enrollment process remains vulnerable to fraud,” Seto Bagdoyan of GAO’s Forensic and Investigative Service wrote in testimony prepared for a hearing Friday of the House Energy and Commerce Committee’s health subcommittee.

“We created application scenarios with fictitious applicants claiming to have impossible Social Security numbers; claiming to be working for an employer that offers health insurance, but not coverage that meets ‘minimum essential’ standards; or already having existing qualified health-plan coverage,” Bagdoyan writes.

“We made four of these 10 applications online and the other 6 applications by phone.”

These and other phony applications all got through.

“The federal marketplace or selected state marketplaces approved each of our 10 fictitious applications for subsidized qualified health plans,” Bagdoyan wrote. “We subsequently paid premiums to put these policies into force.”

They all got federal subsidies, too.

And GAO’s Carolyn Yocom submitted testimony saying the Health and Human Services Department doesn’t have enough checks to make sure people can move smoothly between Medicaid coverage and private insurance on the exchanges.

“In addition, we found that some individuals had duplicate coverage,” Yocom wrote.

“While some amount of duplicate coverage is permissible under federal law — and may be expected during the transition from exchange to Medicaid coverage — we found that duplicate coverage was also occurring under other scenarios, such as when individuals do not end their subsidized exchange coverage after being determined eligible for Medicaid.”

It’s more ammunition for the Republican-controlled House, which has been seeking to show the 2010 Affordable Care Act is poorly designed, riddled with problems and too expensive. Republicans continue to promise to try to repeal the law.

The non-partisan GAO has been warning of the flaws.

In 2014, the accountability office warned that 11 out of 12 fake applications for subsidies got through the verification process.

NBC News

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