Democrats spent four years insisting Obamacare was working better than ever.
Dr Oz just told a different story from the White House podium.
What he said Biden ordered his\agency to do with your tax dollars is the secret Democrats hoped would never come out.
Biden Created a $25 Billion Phantom Enrollment Crisis at CMS
Dr. Mehmet Oz, the Trump-appointed administrator running the Centers for Medicare and Medicaid Services, went before reporters and said something no Obama or Biden official ever admitted.
Obamacare enrollment sat around nine million people for years – 2015, 2016, 2017, 2018, right through 2020.
Then it exploded past 20 million.
The population didn't change and the number of uninsured Americans didn't suddenly surge. What changed was that Biden's CMS was "told to take the guardrails off."
Oz didn't use passive voice. He didn't blame a bureaucratic process or call it an oversight. He said his own agency was given instructions – from above – to stop verifying whether enrollees belonged on the rolls.
"Because there wasn't an earnest desire to keep track of whether you were appropriately on it or not, but more importantly, just get the number to where we all feel good about ourselves," Oz said, "we had massive increases of people joining the program."
A sitting federal administrator just accused the previous administration of deliberately corrupting an enrollment system to manufacture headline numbers.
Democrats called rising Obamacare enrollment a triumph. Oz is saying a significant chunk of that triumph was fraud dressed up as success.
Obamacare ACA Fraud Ran on Taxpayer Subsidies and Broker Commissions
The Paragon Health Institute released a new study that puts hard numbers on what Oz described.
Approximately 6.2 million Obamacare sign-ups in 2026 – nearly 27% of all ACA exchange enrollments – are improper.
Taxpayers are projected to pay up to $25 billion in fraudulent subsidies this year alone, nearly a quarter of total ACA subsidy spending.
Paragon's data found that in 2024, 35% of exchange enrollees filed zero medical claims during their entire enrollment period – the same red flag Oz cited Tuesday as his primary indicator of phantom enrollment.
Oz described exactly how the fraud works. Brokers – paid on commission for every sign-up – enroll people who already have Medicaid into ACA plans without those people's knowledge. The broker collects the commission. The insurer collects the fully subsidized premium. The enrollee never files a claim because they didn't know they were signed up.
Separately, Oz said his agency found individuals enrolled in ACA plans in two states simultaneously, collecting fully subsidized coverage in both.
"These are people who have Medicaid, and someone – often a broker – dishonestly enrolling them in Affordable Care Act, or they're in two states at once getting full insurance paid for by us in multiple states at once," Oz said. "They're extremely concerning."
Paragon's analysis found the fraud is especially concentrated in states using the federal HealthCare.gov platform, where 56% of sign-ups claimed the lowest income bracket qualifying for maximum subsidies.
The GAO flagged the same vulnerability in December, noting investigators obtained subsidized coverage for entirely fake enrollees – the same problem first documented in GAO undercover work going back to 2014.
This was known for over a decade. Nothing was done because the previous administration preferred large enrollment numbers to honest ones.
The Trump administration tried to implement a corrective rule shortly after taking office, a court blocked it on procedural grounds, the administration rewrote the rule, and implemented it roughly two weeks before the briefing – the same relentless approach Trump brought to the border.
DOJ has been making cases. In November 2025, federal prosecutors convicted a brokerage firm president and a marketing company executive in a $233 million enrollment fraud scheme.
Before that, Florida executive Dafud Iza pleaded guilty to enrolling ineligible consumers through falsified applications, costing taxpayers at least $133.9 million in fraudulent subsidy payments.
Paragon's Brian Blase broke down the Obamacare problem: excessive subsidies, zero-premium plans, weak verification, automatic re-enrollment, and broker incentive structures that rewarded sign-ups regardless of eligibility combined to create "a perfect storm for improper and phantom enrollments."
Democrat politicians are already positioning the expected enrollment drop as proof Trump is kicking people off their coverage.
"If you care about the ACA, then you'll want us to take the fraud out," Oz told reporters.
Democrats celebrated rising enrollment numbers for years as proof the program worked. The audit they buried is happening anyway – and the bill is $25 billion.
Sources:
- Ireland Owens, "Obamacare Enrollment Fraud May Cost Taxpayers Billions In 2026, New Study Shows," Daily Caller, June 3, 2026.
- Nick Gilbertson, "Oz Says 35 Percent of Obamacare Enrollments 'May Not Be Legit,'" Breitbart, June 2, 2026.
- Brian Blase et al., "The Persistent Obamacare Enrollment Fraud," Paragon Health Institute, June 3, 2026.
- Brian Blase, "Testimony Before the House Committee on the Judiciary," Paragon Health Institute, December 15, 2025.
- Sens. Boozman and Cornyn, Letter to DOJ on ACA Subsidy Fraud Investigation, U.S. Senate, 2026.