Sting Operation Suggests Obamacare Subsidies Have Reached a Half Million Illegal Immigrants Through Back Door

By Rachel Alexander Published on February 20, 2016

In 2009, President Obama assured Congress that illegal immigrants would not be eligible for Obamacare subsidies. Administration officials repeated it again in 2014 when his executive orders expanded amnesty for younger illegal immigrants. Many Americans didn’t believe him, and now they appear to have been proven right.

If a recent Congressional report is correct, more than 500,000 people together received $750 million in tax credits as of June 2015, people “who were later determined to be ineligible because they failed to verify their citizenship, status as a national, or legal presence” and dropped from coverage. Also according to the report, the IRS estimates that 50 percent of participating taxpayers — 1.6 million individuals — received excess credits.

This information and more may be found in the recent Congressional report, “Affordable Care Act Premium Tax Credits: HHS and IRS Lack Plan to Recover Improperly Spent Taxpayer Dollars,” authored by the Committee on Homeland Security and Governmental Affairs and found on their website and linked to here.

The Government Accountability Office essentially performed a sting operation to discover the waste, applying for Obamacare with 12 fictitious identities. Eleven of the 12 were granted subsidies, even though only seven provided documentation. All 11 were automatically re-enrolled the next year. Eventually, coverage was terminated for six of the fake identities for failing to provide documentation, but the sting operation was able to get coverage for five of the six reinstated, and even obtain increases in the tax credit amounts.

Republicans on the committee found there was little or no screening process to verify that those applying for the Obamacare subsidies were truly eligible.

IRS officials claim they will attempt to recoup the money, but since the federal government has a woeful record at collecting wrongly distributed funds. Committee Chairman Sen. Ron Johnson (R-Wis.) skeptically calls it “pay and chase,” and says the IRS plan to recoup the funds is “ineffective and insufficient.”

The IRS says it is only going to attempt to collect money from individuals who file taxes, but many illegal immigrants don’t file each year. Also, there are no plans to try to recoup excess subsidies doled out to individuals who understated their incomes.

Compounding the problem is a requirement that larger employers must offer all employees healthcare. Los Banos Enterprise explains:

Farm labor contractors say they’re stuck in a Catch-22. The Affordable Care Act doesn’t cover undocumented immigrants, but contractors will get fined if they don’t offer them coverage. Contractors aren’t supposed to hire undocumented workers, but the president and Congress can’t agree on what to do about the massive number of immigrants living and working here illegally.

There were hints along the way that President Obama intended to find a way to cover illegal immigrants. His HHS Secretary, Sylvia Burwell, said in 2014 that DREAMers — the children of parents who were brought into the country after they were born — should be able to access Obamacare. She suggested changes were coming, “And I think everyone probably knows that this administration feels incredibly strongly about the fact that we need to fix that.”

Taxpayer-funded healthcare for illegal immigrants has been expanding incrementally as proponents get bolder. Illegal immigrants are eligible for emergency medical treatment and pregnancy coverage. California, New York, Massachusetts, Illinois and Washington already fund health insurance for DREAMers. The District of Columbia not only funds DREAMers’ health insurance, but their parents’ coverage too.

There are various ways being proposed to include illegal immigrants in Obamacare. A bill has passed the California Senate that would allow illegal immigrants to purchase Obamacare. An estimated 2.5 million out of 38 million residents of California are illegal immigrants. Surprisingly, only about 1 million of those lack health insurance.

Rep. Diane Black (R-Tenn.) has sponsored a bill that would reverse pay and chase, requiring eligibility verification before receiving Obamacare cost reductions and tax credits. It doesn’t appear to be going anywhere in the House, perhaps due to the fact that Obama would never sign it.

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