GAO Probe Focuses on Healthcare.gov Fraud

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The nonpartisan Government Accountability Office (GAO) reported to Congress last Thursday that it has concluded an undercover investigation into the fraud detection capabilities of the federal health exchange website, www.healthcare.gov.

The GAO’s Director of Forensic Audits, Seto Bagdoyan, told the Senate Finance Committee that his investigators submitted applications for eighteen fictitious individuals last year. Of those eighteen, eleven successfully enrolled in a subsidized health insurance plan. And of those eleven, six were flagged as suspicious and terminated but five were able to get their policies reinstated after calling the exchange’s customer service hotline. All of the fake applicants that maintained coverage through 2014 were re-enrolled this year despite missing information or falsified documentation.

The results of the investigation will be included in a larger report that will be released later this year. However, politicians on both sides of the aisle are not waiting to use the findings to attack or defend one of the most high-profile elements of President Obama’s health reform law. The Republican Chairman of the Finance Committee, Sen. Orrin Hatch, said that the investigation “calls into question the legitimacy of the health law’s enrollment numbers and challenges the integrity of the website’s security checks.” Democratic Senator Ron Wyden countered that the report “is not about any real-world fraud . . . Not one of them was a real person who filed taxes or got medical services. No fast-buck fraudster got a government check sent to their account.”

The report also found that the agency responsible for supervising the exchange, CMS, is not required to detect fraud, and has a limited ability to do so. CMS further asserted that there has not been a significant level of fraud on the exchange. More than ten million people signed up for coverage on the federal exchange during the last open enrollment period. In that same time, CMS suspended enrollment for about 226,000 applicants who did not sufficiently document their citizenship or immigration status.

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