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Experts and lawmakers at hearing split over whether fraud or price growth is driving rising premiums
Summary
Witnesses at a House subcommittee hearing agreed the ACA exchange program shows integrity weaknesses but differed on whether fraud or rising provider prices are the main cause of premium growth; proposed fixes ranged from fraud controls to site‑neutral billing and antitrust enforcement.
Lawmakers at a House subcommittee hearing heard sharply different prescriptions from federal auditors, nonprofit researchers and academic economists about what is driving rising premiums on the ACA exchanges and how Congress should respond.
GAO emphasized program‑integrity weaknesses—covert testing that enrolled fake applicants, data matches to deceased individuals, and high counts of multiple policies per Social Security number—while Paragon researchers argued the COVID‑era subsidy expansion exacerbated improper enrollment. Paragon testified that tens of billions in federal spending may have gone to ineligible enrollees.
By contrast, Yale health economist Professor Zach Cooper told the committee that the main driver of premium growth is higher provider and hospital prices, not enrollment fraud. Cooper said the subsidies protect roughly 22,000,000 people and that enrollment in exchange plans is associated with reduced mortality. To address cost pressures, he recommended policy options including site‑neutral billing to reduce facility price differentials and increased funding for antitrust enforcement to deter consolidation.
Witnesses and members also discussed administrative tools to limit improper enrollment, such as mandatory action prior to auto‑reenrollment and modest confirmation fees. Witnesses noted a Trump‑era CMS rule that included a $5 confirmation payment was stayed by courts; reconciliation proposals discussed in the hearing would require enrollees to take action before auto‑reenrollment beginning in 2028.
Members pressed for more prosecutions and stronger enforcement of broker misconduct; witnesses said prosecutions have occurred but pointed to incentive structures—brokers paid per enrollment and insurers receiving subsidies on plan changes—as a root problem.
The hearing did not produce legislation. Members entered studies and press releases into the record and the committee requested additional written materials from witnesses. Lawmakers signaled continued interest in pairing near‑term integrity steps with long‑term reforms to bring down health‑care prices.
