Vice President JD Vance said Tuesday that the Trump administration has recovered $2.2 billion in fraud tied to the Affordable Care Act, arguing that widespread abuse of the program has directly driven up the cost of health care for Americans.
Speaking at a press conference in the South Court Auditorium of the Eisenhower Executive Office Building, Vance said the effort stems from tightening verification of who actually qualifies for Obamacare subsidies. He said the Biden administration had loosened eligibility rules while failing to confirm enrollees actually qualified, even as brokers were financially incentivized to sign people up.
“You have a system where, on the one hand, brokers are paid money to feed patients into the system, while on the other hand, the government isn’t even checking whether the people enrolled are actually eligible for the program. What do you have? Of course—rampant, rampant fraud,” Vance said.
The administration said it has already ended enrollment for 750,000 people it believes were fraudulently signed up, and plans to conduct additional verification on roughly 419,000 more enrollees. That review will check whether individuals are legal U.S. residents and whether their income actually falls within the thresholds required to receive Obamacare benefits.
Vance framed the $2.2 billion recovery in terms of children’s health spending, noting that the average American child receives about $4,000 a year in health benefits. “That means that we are saving 550,000 American children’s worth of healthcare that was going to fraudsters and now will go to the essential services for which it was meant to go,” he said.
Fraud and Rising Costs
Asked directly whether the fraud is contributing to higher health care costs, Vance said it is, for two reasons. First, he argued fraud diverts resources away from doctors, nurses and brokers who are honestly providing care. “That absolutely makes things more expensive,” he said, adding that it is “a huge insult” to health workers “working their fingers to the bone.”
Second, he pointed to broader inflationary pressure. “When you take $2 billion… and you take that money out of the system and put it into fraud—that raises costs for everybody,” Vance said. He connected the issue to inflation during the Biden administration, which he called “the worst inflation in 48 years,” saying government spending funneled to fraudulent claims added pressure to prices nationwide.
Oz Warns Fraud Could “Destroy” the Program
CMS Administrator Dr. Mehmet Oz, who joined Vance at the briefing, said unchecked fraud threatens the viability of the ACA marketplace itself. “You cannot run an insurance business if you have no idea who’s coming in. You can’t rate how sick they are. You have no idea if they’re real,” Oz said.
Oz pointed to state-level programs allowing small employers to use ACA-style choice plans, citing Georgia and Indiana as states where the model has already been implemented, with Connecticut next in line. “Small employers will not use Obamacare if they think that one-third of the people are fraudulent, because they don’t want to join a club that’s going to sink,” Oz said.
Oz also said a legal group he described as “Soros-funded” and aligned with the Democratic Party has sued the administration roughly 150 times over its verification efforts, and recently won a suit blocking officials from checking the tax returns of ACA enrollees. He said that ruling means someone with no income—or a billionaire—could potentially qualify for subsidies. “That’s how you destroy a system,” Oz said.
Vance responded by criticizing the funding behind such legal challenges. “I struggle to understand the mindset and the psychology of a person who makes billions of dollars in the greatest country in the history of the world, and decides to use that money… to ensure that we’re unable to check the eligibility criteria for programs that American people depend on,” he said. “It’s just a sick, sick use of charitable dollars.”
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