September 22, 2026
4 min read
CMS said it is taking action to combat alleged fraud in the Affordable Care Act program.
One expert told Healio the move could further strain the nation’s healthcare system.
In a press conference Tuesday, Vice President JD Vance and CMS administrator Mehmet Oz, MD, announced CMS is canceling 315,000 “unauthorized enrollments,” removing coverage for more than 760,000 people believed to be fraudulently enrolled in the ACA.
“We are announcing $2.2 billion in American taxpayer money that we’re saving by doing this amazing common sense and what should have been an obvious thing: We’re actually making sure that people receiving Obamacare subsidies are actually entitled to receive them,” Vance said.
CMS is also seeking additional verification for 419,000 other beneficiaries, Vance said.
“We’re going to make sure that they’re, first of all, legal residents of the United States of America and, second of all, we’re going to make sure that they actually meet the income threshold requirements in order to receive these Obamacare benefits,” he said.
Oz said CMS will be taking action to prevent improper or fraudulent enrollments upfront: a temporary national moratorium.
“It has never been done before. There will be no new brokers for Obamacare in this country for the next 6 months,” he said. “We do not feel at all conflicted about that decision because most of the fraud — a disproportionate amount of the fraud — is taking place from these individuals. So, if you have an active exchange agreement, you can keep in the system for now. We’ll see about you. But the folks who are thinking of coming on down and taking advantage, they’re not going to be in.”
According to a press release from CMS, the organization will also now require identity proof from all existing brokers and agents, require applications with brokers or agents to include a social security number or other verifiable documentation, require electronic consumer authorization before a broker or agent can act on a consumer’s enrollment, and update the system to prevent brokers and agents “from being added to applications that consumers should be completing on their own.”
Vance and Oz pointed to “weakened guardrails” during the COVID-19 pandemic as the impetus for the fraud.
“The prior administration decided not to enforce the weakened guardrails,” Oz said. “About 35% of current people on the Obamacare system — more than a third — have never used the program. They haven’t bought a prescription medication. They hadn’t seen a doctor. That’s just not possible.”
Arthur L. Caplan, PhD, professor emeritus and founding head of the division of medical ethics at NYU Grossman School of Medicine, told Healio that this “fraud effort represents the administration’s efforts to rein in cost and address the healthcare affordability issue,” but it is misguided.
“The administration continues to chase fraud as the problem, whereas it’s pretty obvious that cost is the problem. Premiums are too high — people have had to drop out of the program. Coverage is not what it should be,” Caplan said. “The administration continually focuses on fraud as the way to save money, but it is the dramatic increases in the costs of the program premiums related to the escalating costs from last year of healthcare that is the real core issue.”
He explained that seeking to cut fraud is a worthy goal, “but it’s become politicized at this point.”
“The Republicans, if you will, see fraud everywhere. The Democrats see high prices and inadequate coverage as a result everywhere,” he added. “I think it would be nice in this area if they could get to some consensus and attack both.”
He also questioned pandemic-related fraud as the root of the issue and the moratorium decision.
“Fraud was a problem during COVID. There were plenty of people who tried to rip off the government, but I don’t think the ACA was particularly fraud-prone, if you will, at that time,” he said. “In order to chase down fraud, you don’t have to put a hold on the program and put people’s health and lives at stake. I don’t consider that necessary, and it seems to me it’s morally dubious given the vulnerability that you’re creating for new enrollees who need coverage … Continue to enroll people who need the program and then continue your investigations. It’s not like you have to put the whole thing on hold.”
But regardless, Caplan said that the healthcare system will pay the price for CMS’s decisions.
“Anything that cuts coverage for poor Americans means more strain on public facilities, emergency rooms, any place that people will go when they can’t go to a physician themselves,” he said. “It will strain our charitable safety net within the system, which involves, primarily, emergency care.”
Arthur L. Caplan, PhD, can be reached at [email protected].
Disclosures:
Caplan reports no relevant financial disclosures.
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