Des Moines Sun

U.S. Senator Chuck Grassley from Iowa is urging the Centers for Medicare & Medicaid Services (CMS) to address alleged fraud within the Affordable Care Act (ACA) marketplace. According to Grassley, taxpayers paid approximately $20 billion in improper subsidies in 2024, a figure that could rise to $27 billion in 2025.

Grassley has criticized the Biden administration for not responding to his inquiries about efforts to reduce waste and fraud in the ACA marketplace. "The Biden administration’s failure to adequately oversee these subsidies has had expensive consequences," he wrote.

In 2021, changes were made under the Biden administration that increased premium tax credits for higher-income earners and reduced cost sharing through 2025. This policy allowed individuals with incomes between 100% and 150% of the federal poverty level to qualify for fully subsidized health insurance plans, raising concerns about program integrity.

Reports suggest fraudulent enrollments have occurred due to vulnerabilities exploited by insurance agents and brokers. The Trump Department of Justice indicted Cory Lloyd and Steven Strong earlier this year for their involvement in a $161 million ACA enrollment fraud scheme targeting vulnerable individuals.

Grassley's letter highlights another type of fraud involving targeted internet advertisements that misled consumers into enrolling with false income information. Insurance agents allegedly manipulated income data to maximize federal marketplace plan subsidies.

To facilitate congressional oversight, Grassley has requested detailed information from CMS on measures taken against such fraud schemes, including estimates of fraudulent enrollments and coordination with the IRS for recouping excess payments.

Grassley concludes his letter seeking responses by July 21, 2025, emphasizing accountability within CMS and its efforts against improper activities related to ACA enrollments.