Obamacare abused by brokers to sign up millions for healthcare without their consent or knowledge. As a result, insurance companies reaped windfall profits, at the expense of taxpayers.
In exchange for gift cards, millions of Americans were unwittingly signed up for Obamacare by brokers who scalped their vital information and enrolled them in plans where premiums were paid by the American people, a research group says.
“The government was sending massive checks to insurance companies who were making windfall profits on behalf of people who didn’t use any health care,” Brian Blase, president of Paragon Health Institute, a healthcare policy group told Just The News.
A 2021-2022 expansion of Affordable Care Act subsidies, passed through budget reconciliation, made coverage fully subsidized for individuals claiming incomes in a specific range. Paragon Health Institute investigated and estimated that by 2025, at least 6.4 million more people were enrolled in these zero-premium plans than were actually eligible.
Zero premium means the enrollee did not pay for the plan — it was paid via subsidies funded by taxpayers.
In 2024 40% of people in fully subsidized plans used no healthcare services at all
According to Blase, unscrupulous brokers and enrollment agents exploited the system by advertising cash gift cards and free coverage, collecting personal information from callers, and enrolling them — often without their knowledge or consent, including fictitious individuals.
Many of the enrollees never realized they had coverage because the government paid the full premium directly to insurers, which in turn paid substantial commissions to the enrolling entities. In 2024, 40% of people in fully subsidized plans used no healthcare services at all—2.5 times higher than typical rates—resulting in significant government payments to insurers for largely unused coverage.
Making matters worse, the insurance companies aren’t even providing value, says Blase. “85% of all the [insurance company] revenue now comes from the taxpayer, so they don’t have incentives to offer products that are low-priced, that appeal to patients.”
“Their primary client now is the United States Treasury, and they’re so dependent on the federal government for their revenue source, that’s why insurance companies are spending hundreds of millions of dollars lobbying Congress to continue this gravy train of these enhanced Obamacare subsidies.”