The Wall Street Journal Editorial Board: The Phantom Patients of Obamacare
WASHINGTON, D.C.— The Wall Street Journal Editorial Board highlighted new analysis from Paragon Health Institute that reveals, under the Biden Administration’s pandemic-era Obamacare COVID credits—also known as enhanced Premium Tax Credits—taxpayers are footing the bill for nearly 12 million “phantom” enrollees who have never used their coverage.
WORD ON THE STREET
Excerpts from the Wall Street Journal:
“Obamacare really is a gift that keeps on giving—for insurers. The law forces Americans to buy pricey plans with benefits they don’t need. And now the Paragon Institute reports that taxpayers are subsidizing insurance for nearly 12 million people who never use their coverage.
Democrats in 2021 sweetened subsidies for buying insurance on the Obamacare exchanges. Enrollment has since doubled while taxpayer costs rose by 150 percent. Spending on Obamacare subsidies has increased faster than Medicaid or Medicare since 2020, if you can believe it. Democrats tout this blowout of government-subsidized healthcare as a triumph.
Here’s the wild part: More than a third of all enrollees generated no medical claims last year, according to Paragon’s analysis. That includes 40 percent of those in plans that are fully subsidized. Between 2021 and 2024, the number of enrollees who didn’t use their health coverage more than tripled to 11.7 million from 3.5 million.
As Paragon explains, tens of billions of dollars in subsidies for these 11.7 million enrollees ‘went to insurers and middlemen without funding a single medical service.’ … Insurance brokers have been fudging incomes of people in order to enroll them in government-subsidized plans for which they aren’t eligible, often without their knowledge. The Biden Administration facilitated such fraud by easing income verification and eligibility checks.
This is why Republicans in their tax bill strengthened income verifications for Obamacare plans. Democrats claim such measures will cause millions of people to lose coverage. But many of them don’t need or use their insurance. Some are enrolled in employer plans or Medicaid. The subsidies pad the profits of insurers.
Forgive us for being old-fashioned, but why should taxpayers subsidize insurance for healthy people who don’t need or use it?”
BACKGROUND
Obamacare subsidies exploded under Democrats, costing taxpayers more while delivering less coverage. Instead of funding care for the vulnerable, billions are wasted on “phantom” enrollees who never use their coverage. The One Big Beautiful Bill reflects House Republicans’ commitment to restoring accountability, strengthening oversight, and ensuring every dollar goes to helping those who need it most.
Key Takeaways from the Paragon Health Institute analysis cited in the WSJ:
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The number of Obamacare individual market enrollees with no medical claims more than tripled from 2021 to 2024. Nearly 12 million enrollees had no medical claims during 2024.
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A staggering 40 percent of enrollees in 94 percent actuarial value silver plans and bronze plans had no medical claims in 2024.
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The rise in phantom enrollees is absent in the small-group market, strongly suggesting it was driven by Biden’s COVID credits.
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Tens of billions in federal subsidies are flowing to insurers and brokers for phantom enrollees—people without a single doctor visit, prescription filled, or service received.
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This surge mirrors Paragon’s findings on improper enrollment, showing taxpayer dollars wasted on coverage for people not using the program.
