Vice President Vance said Sunday that subsidies offered under the Affordable Care Act (ACA) fuel waste and fraud in the insurance industry, as Republicans refuse Democratic demands to extend the tax credits ahead of open enrollment next month.
“The tax credits go to some people deservedly. And we think the tax credits actually go to a lot of waste and fraud within the insurance industry. So we want to make sure that the tax credits go to the people who need them,” Vance told Margaret Brennan on CBS News’s “Face the Nation.”
The tax credits, first offered during the pandemic and extended by the 2022 Inflation Reduction Act, expire at the end of this year. According to the health care policy research group KFF, premiums for millions of people will more than double next year if the subsidies are not extended.
The impact could be felt even soon. With open enrollment for the ACA marketplace in most states scheduled to start Nov. 1, insurers are set to increase premiums unless Congress acts in the coming weeks.
The vice president’s claims of waste and fraud echo conservative arguments regarding the subsidies. Last month, a group of 35 right-leaning organizations sent a letter to President Trump, urging him to allow the credits to expire.
“Making the Biden COVID credits permanent would be tremendously expensive, increase premiums in the long-term, and encourage widespread fraud,” the letter said.
Via authority granted by the ACA, the Department of Health and Human Services conducts fraud oversight through the Center for Medicare and Medicaid Services (CMS). According to KFF, allegations of fraud in ACA enrollment have mostly centered on agents, brokers, web brokers and other third parties.
From January 2024 through August 2024, CMS received over 180,000 complaints of third party entities fraudulently enrolling consumers in the Healthcare.gov marketplace, and 90,000 complaints regarding third parties switching consumers’ plans.
In its Marketplace Integrity and Affordability report published in June, CMS said the “widespread availability of $0 premium plans created the incentive and opportunity for fraudulent and improper enrollments at scale, either by the enrollee’s own doing or by a third party without the enrollee’s knowledge.”
While Republicans say they don’t want to see insurance premiums spike for millions of people who rely on ObamaCare, they have not put forward an alternate plan to deal with the coming cliff.
House Speaker Mike Johnson (R-La.) said Monday sought to blame Democrats for putting a deadline on the subsidies in the first place.
“The Covid-era Obamacare subsidy that they’re all talking about that’s supposedly the issue of the day doesn’t expire until the end of December. And by the way, it is the Democrats who created that subsidy, who put the expiration date on it,” he told reporters at a press conference.
They put an end date on it because they knew it was supposed to be related to Covid, and it’s become a boondoggle.”
