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TRUMP ADMINISTRATION SAYS ACA ENROLLMENT ABUSE COST BILLIONS - BUT THE $10 BILLION ANNUAL FIGURE IS AN ESTIMATE, NOT THE GOVERNMENT'S FORMAL IMPROPER-PAYMENT MEASURE
The Trump administration has identified real problems in the Affordable Care Act Marketplaces, including unauthorized enrollments, duplicate Medicaid or CHIP coverage, tax-credit reconciliation failures and criminal broker schemes that generated hundreds of millions of dollars in unwarranted subsidies. A June 2026 HHS analysis also estimated that improper, phantom and fraudulent enrollment peaked at 5.6 million people in 2025. But the widely cited claim that abuse cost taxpayers about $10 billion every year from 2021 through 2024 came from an administration estimate reported by Fox News, not from CMS's formal improper-payment measurement. The official payment-error data are much lower and measure a different universe, while HHS's 5.6 million figure is a modeled estimate rather than a count of 5.6 million people individually proved to have committed fraud.
Updated and fact-checked through Sept. 13, 2026.
The $10 Billion Annual Figure Is a Trump Administration Estimate
Fox News reported on June 26 that a Trump administration official estimated that abuse of the ACA Marketplace system had cost taxpayers about $10 billion per year from 2021 through 2024. The official linked that estimate to the rapid growth of subsidized enrollment and to what the administration describes as weakened eligibility safeguards during the Biden years.
That figure should be attributed to the administration. It is not the same thing as an audited CMS finding that $10 billion in fraud was proved in each of those years, and HHS's public June analysis does not present a year-by-year accounting establishing that precise historical loss.
The $10 billion claim is a policy and enforcement estimate from the Trump administration, not the government's formal improper-payment rate and not a tally of criminal fraud convictions.
The Government's Formal Improper-Payment Numbers Are Far Lower
CMS and the IRS separately measure improper payments in the premium-tax-credit program. For benefit year 2022, the combined estimate was about $925.66 million in improper payments out of approximately $56.98 billion in total premium-tax-credit payments and claims, an error rate of 1.62%.
For benefit year 2023, the combined estimated improper-payment amount rose to about $1.13 billion out of $75.30 billion, or 1.50%.
The CMS component of those measurements covers advance premium tax credits administered through the federally facilitated Exchange. State-based Exchanges were not included in that CMS measurement, which limits direct comparison with broader national enrollment estimates.
The official improper-payment data do not validate a $10 billion annual fraud figure. They measure a different population and use a different methodology.
An 'Improper Payment' Is Not Automatically Fraud
CMS repeatedly warns that improper-payment estimates are not fraud-rate estimates. A payment can be improper because documentation is missing, a required verification step was not completed, the wrong amount was paid or an administrative requirement was not followed.
Some improper payments do represent money that should not have been paid. Others are classified as technically improper even though the recipient was eligible and the dollar amount was correct.
For benefit year 2022, most of CMS's measured advance-premium-tax-credit error rate was classified as technically improper rather than a monetary loss caused by an ineligible enrollee.
Calling every improper payment 'fraud' materially overstates what the government's own payment-integrity statistics mean.
HHS's 5.6 Million Figure Is a Modeled Estimate, Not 5.6 Million Proven Fraudsters
The June 26 HHS analysis estimated that improper, phantom and fraudulent ACA enrollment peaked at 5.6 million people in 2025 and that about 2.6 million potentially improper or phantom enrollments remained in 2026.
The report defines improper or fraudulent enrollment to include cases in which people allegedly misstated income to obtain subsidies and uses 'phantom' enrollment for people who may have been enrolled without realizing it, including through unauthorized broker activity.
But the 5.6 million estimate is not a case-by-case adjudication. HHS says it derived the figure by comparing observed enrollment with a historical baseline and estimated transitions from other coverage sources, then treating the unexplained residual as suspected improper, phantom or fraudulent enrollment.
The administration's estimate is evidence of a suspected program-integrity problem. It is not proof that 5.6 million identified individuals knowingly committed fraud.
More Than 1 Million Enrollments Without a Social Security Number Are Not Automatically Illegal
HHS says its remaining 2.6 million estimate includes more than one million enrollments without a Social Security number.
That is a useful verification signal, but the absence of an SSN does not by itself establish ineligibility or fraud. states that applicants must provide an SSN if they have one, while certain lawfully present immigrants may not have or be eligible for an SSN and can use immigration documentation for eligibility verification.
Marketplace applications can also include non-applicant household members who are not always required to supply Social Security numbers.
A missing SSN can justify additional verification. It is not, standing alone, proof that an enrollee is nonexistent, undocumented or fraudulently insured.
ACA Enrollment Really Did Surge During the Biden Years
The enrollment increase that triggered the current scrutiny is real. More than 21.4 million people selected or were automatically re-enrolled in Marketplace plans during the 2024 open-enrollment period, up dramatically from pre-pandemic enrollment levels of roughly 10 million annually.
But the increase had multiple documented drivers. Congress expanded premium tax credits through the 2021 American Rescue Plan and later extended them through the Inflation Reduction Act. Many lower-income consumers became eligible for benchmark plans with little or no monthly premium.
Millions of people also moved from Medicaid or CHIP into Marketplace coverage as states resumed eligibility redeterminations after the pandemic continuous-enrollment period. Increased outreach and easier enrollment also contributed.
HHS's own 2026 analysis estimates that about 6.1 million of the post-2019 enrollment increase can be explained by transitions from Medicaid, off-Exchange coverage, small-group employer coverage or being uninsured.
Enrollment growth was not evidence of fraud by itself. A substantial share resulted from deliberate federal subsidy expansion and shifts from other forms of coverage.
Unauthorized Enrollment Was a Real and Large Consumer-Protection Problem
The strongest evidence supporting the administration's concern comes from consumer complaints and broker-enforcement data rather than from the $10 billion headline figure.
From January through August 2024, CMS received 183,553 complaints from people saying they had been enrolled in federally facilitated Marketplace coverage without consent. It also received 90,863 complaints that consumers' plans had been changed without authorization.
Between June and October 2024, CMS suspended 850 agents and brokers from Marketplace participation based on reasonable suspicion of fraudulent or abusive conduct involving unauthorized enrollments or plan switches.
Unauthorized enrollment was not hypothetical. CMS documented a major wave of complaints and took enforcement action before the Trump administration returned to office.
The Data-Matching Problem Also Grew Sharply
CMS has reported that the number of applications containing information that did not match federal data sources rose from 2.6 million in 2020 to 6.3 million in 2022.
A data-matching issue can arise when income, citizenship, immigration status or other application information cannot immediately be confirmed against available government data. It can require additional documents from the consumer.
A mismatch can indicate a false statement, but it can also result from stale data, irregular income, missing records or other non-fraud explanations.
The rise in data-matching issues supports stronger verification, but a mismatch is an investigative or administrative flag rather than proof of fraud.
Federal Prosecutors Have Proven Serious ACA Enrollment Fraud
Separate criminal cases show that some Marketplace abuse was organized, intentional and extremely costly.
In April 2026, AP of South Florida agreed to plead guilty to major fraud against the United States for a scheme that prosecutors said fraudulently enrolled thousands of vulnerable consumers in fully subsidized ACA plans. DOJ said the federal government awarded about $141.5 million in unwarranted subsidies. AssuredPartners, the company's former parent, separately agreed to pay $107 million to resolve civil False Claims Act allegations and was not criminally charged in that resolution.
In another case, Cory Lloyd and Steven Strong were each sentenced to 20 years in prison in February 2026. Prosecutors said their scheme sought more than $233 million in fraudulent ACA subsidies, of which the government paid at least $180 million, while the defendants collected millions in commissions.
These cases establish that large-scale criminal ACA enrollment fraud occurred. They do not prove that every questionable or improper enrollment in the national statistics was criminal.
CMS Says It Ended Subsidies or Coverage for Nearly 1.5 Million People
CMS reported in January that program-integrity actions during 2025 ended premium subsidies or coverage for nearly 1.5 million people on the HealthCare.gov platform who were found ineligible for financial assistance or enrolled without authorization.
The total included about 550,000 people identified through periodic matching as simultaneously enrolled in Medicaid or CHIP and subsidized Marketplace coverage, hundreds of thousands affected by failure-to-file-and-reconcile rules, and roughly 250,000 unauthorized enrollments that were canceled.
CMS estimated those actions produced nearly $10 billion in savings on an annualized basis.
That nearly $10 billion figure is projected future annualized savings from stopping or canceling subsidies. It is not the same figure as the separate claim that $10 billion was fraudulently lost in each Biden-era year.
The 'Nearly 3 Million Removed' Claim Also Needs Precision
HHS says Trump administration program-integrity efforts stopped about 1.5 million people from receiving subsidies they did not qualify for and that another 1.4 million were removed or blocked through February 2026, for a total of roughly 2.9 million.
The first group is tied to identifiable administrative actions such as Medicaid or CHIP matching, tax reconciliation and unauthorized-enrollment cancellations. The second group includes people HHS estimates were blocked or left coverage after policy changes, including the end of year-round enrollment for certain low-income applicants.
HHS also points to high cancellation rates among zero-premium and broker-assisted plans as evidence that the system is shedding improper enrollments, while acknowledging that the exact reason for each cancellation is unknown.
Describing all 2.9 million people as proven 'fraudsters' is inaccurate. The number combines direct eligibility actions with broader estimates and inferences about enrollment behavior.
Biden-Era Policy Changes Did Reduce Some Verification Friction
The Trump administration is correct that several Biden-era policies made enrollment or subsidy retention easier.
Among them were a monthly special-enrollment pathway for people with projected incomes at or below 150% of the federal poverty level, a longer period for resolving some income inconsistencies, rules allowing self-attestation in certain cases when IRS tax data were unavailable, and a two-year rather than one-year failure-to-file-and-reconcile standard before advance tax credits were cut off.
At the same time, the largest change in affordability came from enhanced premium tax credits enacted by Congress in the American Rescue Plan and extended by Congress in the Inflation Reduction Act. Those laws intentionally reduced consumer premiums and expanded the population able to obtain heavily subsidized coverage.
It is fair to say Biden-era rules reduced some verification barriers. It is misleading to attribute the entire enrollment surge or every zero-premium plan to administrative weakening rather than to congressionally enacted subsidy policy.
The 2025 Marketplace Integrity Rule Was Only Partly Implemented
CMS finalized the Marketplace Integrity and Affordability Rule in June 2025. It tightened income verification, eliminated the low-income monthly special-enrollment period, changed tax-credit reconciliation rules, added special-enrollment verification and strengthened the standard for terminating brokers who violate Marketplace requirements.
But the rule did not take effect exactly as written. In August 2025, a federal judge in Maryland stayed several provisions after finding that challengers were likely to succeed on claims that parts of the rule conflicted with the ACA or were arbitrary and capricious.
In June 2026, the same court vacated multiple provisions on the merits, including several verification and enrollment changes. The administration appealed and issued a new 2027 Marketplace rule with revised versions of some policies.
The administration has restored some safeguards, but it is inaccurate to imply that every 2025 integrity provision has been fully operative and judicially upheld.
The Legal Fight Continued Into 2026
The replacement 2027 Marketplace rule triggered another lawsuit by cities, physicians and small-business advocates.
On July 16, a federal judge granted a stay preventing challenged provisions from taking effect while the case proceeds. The court again questioned whether CMS had adequately supported some of its assumptions about fraud and whether certain changes were consistent with the ACA.
Critics argue that strict documentation rules can cause eligible consumers to lose subsidies because of paperwork, irregular income or outdated government data. The administration argues that the same checks are necessary to prevent taxpayer-funded coverage from going to people who are not eligible.
Program integrity is a legitimate government objective, but the specific verification tools remain subject to statutory and administrative-law limits.
The Strongest Defensible Conclusion
The Trump administration has identified a real ACA Marketplace integrity problem. Unauthorized broker activity generated hundreds of thousands of consumer complaints, federal prosecutors have proved large criminal schemes involving hundreds of millions of dollars in subsidies, and CMS has ended or canceled large numbers of subsidies and policies after finding eligibility or authorization problems.
The administration's June HHS analysis also offers a serious estimate that improper, phantom and fraudulent enrollment peaked at 5.6 million people in 2025 and that about 2.6 million questionable enrollments may remain.
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But the most dramatic numbers require careful labels. The claim of roughly $10 billion in annual Biden-era abuse is an administration estimate, not CMS's formal improper-payment measure. Official combined premium-tax-credit improper-payment estimates were about $926 million for benefit year 2022 and $1.13 billion for benefit year 2023, and those measures are not directly comparable with HHS's broader modeled enrollment estimate. Likewise, missing Social Security numbers, data mismatches, cancellations and zero-premium coverage are not automatic proof of fraud.
The strongest verified conclusion is that significant ACA enrollment fraud and unauthorized enrollment occurred and that stronger program-integrity controls can prevent real taxpayer losses. What the public record does not support is collapsing every irregular enrollment into criminal fraud or treating the administration's $10 billion annual estimate as an audited historical loss. The accurate story is a mix of proven fraud, administrative error, unauthorized broker activity, legitimate enrollment growth and an ongoing legal fight over how aggressively the government may verify eligibility without wrongly stripping coverage from eligible people.
