US cuts Obamacare subsidies for 189,000 with duplicate coverage

WASHINGTON - The Trump administration said on Wednesday it is cutting off Affordable Care Act subsidies for about 189,000 people it identified as having duplicate government coverage or being deceased, a move officials estimate will save taxpayers roughly $738 million this year.

U.S. Health Secretary Robert F. Kennedy Jr. said the Centers for Medicare & Medicaid Services identified enrollees in 2026 as holding subsidized coverage on the ACA federal marketplace, also known as Obamacare, while also enrolled in Medicare, Medicaid or the Children's Health Insurance Program. It also identified deceased people still on the subsidy lists.

"When the federal government pays a subsidy for a healthcare.gov plan, we have an obligation to check whether that payment is owed," Kennedy said at a press conference. "We certainly can't keep paying for people who are deceased."

The administration estimates the action will prevent $738 million in improper subsidy payments this year, a figure that exceeds $1.5 billion annualized, Kennedy said. The government expects to prevent more than 1 million months of improperly subsidized coverage by year's end.

The move builds on a broader crackdown against alleged fraud.

Vice President JD Vance in September said the administration was halting enrollment for more than 760,000 people believed to have been fraudulently signed up for Obamacare plans, an effort he estimated would save $2.2 billion. CMS Administrator Dr. Mehmet Oz said Wednesday's action is separate from the one announced last month.

The agency said it canceled duplicate subsidies for about 120,000 people who also had Medicaid, the federal and state health plan for low-income Americans, and 58,000 who also had Medicare, the U.S. health insurance for those age 65 and older, and roughly 11,000 deceased enrollees through July, with another 3,500 expected by month's end, CMS official Peter Nelson said. Those with Medicaid or Medicare kept coverage in one program.

Nelson said flagged enrollees or their estates receive 30 days to contest the finding before any subsidy stops.

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