(Washington, D.C.) – Citizens Against Government Waste (CAGW) expressed exasperation after the Government Accountability Office (GAO) released the final results of its 2015 undercover tests on the Affordable Care Act’s (ACA) fraud prevention capabilities. Amid naïve proclamations by President Obama that the ACA is “working exactly as it’s supposed to,” the GAO report reveals the sad reality that this law is uniquely prone to fraud and taxpayers have good reasons to worry.
GAO began “secret shopper” investigations in 2014 to test whether or not the federal healthcare exchange (marketplace) and select state marketplaces were able to detect and prevent falsified applications for subsidized health coverage from being accepted. Those tests found that 11 of 12 fictitious identities received coverage and after a call to the marketplace in 2015, 10 of those 11 were re-enrolled for the following coverage year.
On September 12, 2016, GAO released the final results of its 2015 testing, which covered the federal marketplace and state exchanges in California, Kentucky, and North Dakota. The results were similarly jarring.
All 10 fictitious identities that applied for taxpayer subsidies were approved, even after eight of the 10 failed the preliminary identity check. Investigators were able to obtain subsidies after they provided false proof of income, documentation of citizenship, and Social Security numbers that began with zeroes. The federal exchange made no effort to validate that information. GAO also created fake applicants for Medicaid coverage, and the results were not much better: seven of the eight fictitious applicants were approved for subsidized coverage.
Perhaps the most distressing revelation in this report is the following admission from federal and state marketplace officials: “The marketplace or Medicaid offices only inspect for supporting documentation that has obviously been altered. Thus, if the documentation submitted does not show such signs, it would not be questioned for authenticity.”
CAGW President Tom Schatz said, “The Congressional Budget Office estimates that subsidized health coverage through Obamacare will cost taxpayers $866 billion over the next ten years. The fact that there is still no reliable system in place to prevent rampant fraud is a bad omen for taxpayers. This damning report provides further justification for this flawed law to be completely overhauled and replaced.”
Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.
**** Heading to Single Payer:
The McKinsey Center for U.S. Health System Reform, which studies the ACA and its implications, showed in an Aug. 18 analysis that the percentage of counties in the U.S. with five or more participating insurance carriers remaining in the exchanges will likely shrink from 51 percent in 2016 to 31 percent in 2017, and the number of counties having only one carrier participating will likely grow from 2 percent in 2016 to 17 percent in 2017. Pinal County in Arizona found out in August that it will have no insurance carriers participating in ObamaCare exchanges in 2017.
This massive insurer exodus from Obamacare markets not only creates a shrinking pool of competition and narrower networks, but could also be setting the stage for something far more devastating: the inevitable push for a single-payer or public option to either be added to, or replace, ObamaCare.
In an Aug. 2 Journal of the American Medical Association article, President Obama, despite the overwhelming evidence that heavy-handed government control has not worked to make quality healthcare more affordable, called for adding a public option; more tax dollars to prop up the exchanges; more government bureaucrats and politicians making decisions on how healthcare is delivered to our nation’s citizens; and pharmaceutical price controls, which would destroy research and development and deny patients access to promising new therapies.
One need only to look at the Veterans Administration to understand what a government-run, single-payer healthcare system looks like. Horror stories of long waits for treatment, bureaucratic inertia, fraud, incompetence, cover-ups and politics abound.
Others in favor of a complete government takeover demand “Medicare for all,” also a single-payer system, ignoring the fact that on its current trajectory, the Medicare trust fund will be depleted in 2028, two years earlier than projected in 2015. Only massive tax hikes, budget cuts to other government programs, or more borrowing will save it.
These pro-single payer zealots want to emulate the disastrous single-payer systems adopted in other countries, where program costs exceeded expectations and rose faster than predicted, price controls were enacted, rationing became necessary and higher taxes were imposed to cover ballooning costs. Indeed, they are pushing hard for the United States to replicate these failed policies on an even grander scale.
They are ignoring the results so far of ObamaCare: numerous co-op failures costing billions of dollars, skyrocketing premiums and crippling deductibles across the country. With a slew of insurers exiting the ObamaCare exchanges, the nation’s healthcare system is now even more perplexing and costly.
With about two months left until the presidential election, it is time to start thinking critically about healthcare and why moving toward a propped-up ObamaCare or adopting a single-payer approach are not the answers to fixing the country’s broken healthcare system.
Creating an environment where a true market-based system can flourish and in which the purchasing power and healthcare decision-making stands with consumers, not with Washington politicians and bureaucrats, is the way to go.
Schatz is president of Citizens Against Government Waste.
