Paragon Health Institute estimates 6.2 million Affordable Care Act exchange enrollees may be improperly receiving subsidized coverage, as federal officials acknowledge ongoing fraud risks in the program.
By yourNEWS Media Newsroom
A conservative health policy group is raising new concerns about Affordable Care Act enrollment integrity, warning that millions of people may be receiving subsidized Obamacare coverage despite questions about their eligibility.
The Paragon Health Institute, led by former Trump economic adviser Brian Blase, estimated in a new report that 6.2 million people enrolled through ACA exchanges in 2025 may not qualify for the subsidized coverage they received. The group said that figure represents about one-quarter of all ACA exchange enrollees and could cost taxpayers as much as $25 billion this year.
The analysis is based on federal enrollment figures and Census Bureau data. Paragon argues that the number of people receiving subsidized ACA coverage is significantly higher than the number who appear eligible based on reported income levels.
“Obamacare enrollment over the last few years has been inflated by improper and phantom enrollees, and those enrollees are expensive to the taxpayer,” Blase told The Washington Post.
Blase said the issue may be especially severe in states that did not expand Medicaid, including Florida and Texas, because applicants in those states can have an incentive to report income levels high enough to qualify for ACA subsidies.
“The problem is more severe in states that did not expand Medicaid, because in those states there’s incentives to overestimate income and claim a subsidy,” Blase said.
The report comes as the Trump administration intensifies its review of waste, fraud and abuse across federal programs. President Donald Trump has long criticized Obamacare, and the new findings are likely to add to the debate over the program’s cost, oversight and eligibility rules.
Federal officials have also acknowledged enrollment concerns. A spokesman for the Centers for Medicare & Medicaid Services told the Post that the agency estimated as many as 4.4 million ACA enrollments in 2024 may have been improper.
The Government Accountability Office has also warned that the ACA marketplace continues to face fraud risks. In a December report, the watchdog agency stated, “For example, we were able to get subsidized insurance for fake enrollees.”
Some critics of Paragon’s estimate have disputed the scale of the problem, but they have also acknowledged that improper enrollment has occurred.
“There is clear evidence that, in 2024, rogue brokers improperly enrolled or switched the enrollment of a few hundred thousand people without their permission,” Jason Levitis of the Urban Institute told the Senate Finance Committee.
The Trump administration has already moved to tighten eligibility rules and expand oversight of the program. In an April interview with Blase, CMS Administrator Mehmet Oz praised Paragon’s “pioneering work” on ACA fraud and abuse.
“I like using a scalpel, but there are some times you have to use a meat cleaver because the whole system is in such shock that you need to be able to fix it,” Oz said.
Blase said the administration is beginning to address obvious program-integrity problems.
“The Trump administration has come in and is trying to clean up some of the obvious stuff,” Blase said.
The White House fraud task force is also expected to review ACA enrollment practices as part of a broader effort to protect taxpayer funds.
The Paragon report places renewed attention on how subsidized ACA coverage is verified, how brokers enroll consumers and whether federal safeguards are strong enough to prevent ineligible or nonexistent enrollees from receiving taxpayer-backed insurance benefits.