Arlington, Va. – Americans for Prosperity (AFP) commented on a new report indicating that between 4 and 5 million people are improperly enrolled in fully subsidized plans through the Affordable Care Act (ACA), costing taxpayers $15 to $26 billion annually. The report, issued by Paragon Health Institute, found that the number of individuals with incomes between 100 and 150 percent of the Federal Poverty Level (FPL) enrolled in fully-subsidized ACA plans exceeds the total number of potentially eligible individuals.
The issue is partly attributed to significant enhancements of the subsidy program enacted in 2021 and lax enforcement measures. According to AFP, these findings highlight the risks associated with policies that allocate tax dollars to third parties for health coverage. Insurers reportedly have little incentive to prevent fraud since more enrollees result in more subsidies.
“This report should serve as a wakeup call to lawmakers that it’s time to fund patients, not insurance companies,” said Dean Clancy, senior health policy fellow at Americans for Prosperity. “Patients need more choices than what the status quo offers and taxpayers deserve a health care system that prevents fraud. Congress should provide every American with a Personal Option that puts people and families – not third-party middlemen – in control of health care.”
AFP commended House Ways and Means Committee Chair Jason Smith (R-MO), House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA), and House Judiciary Committee Chair Jim Jordan (R-OH) for requesting an investigation by the Biden administration into improper ACA enrollments.
One proposed reform aimed at reducing fraud by funding patients instead of insurance companies is H.R. 5608, the HSA ACCESS Act. Sponsored by U.S. Representatives Greg Steube and Kat Cammack, this bill would allow approximately 5 million people enrolled in ACA plans to allocate part of their cost-sharing reduction subsidies into tax-advantaged health savings accounts (HSAs). Enrollees who opt for this HSA option could use their funds to purchase medical items and services directly, including those not covered by insurance, thus enhancing access to necessary care.
By empowering Americans with control over their healthcare finances, policies like the HSA ACCESS Act aim to create more choices, reduce costs through increased competition, and protect taxpayers from fraud.
For additional information, please visit PersonalOption.com.
For media inquiries, please contact Geoff Holtzman at gholtzman@afphq.org.
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