Unauthorized ACA Enrollments and Plan Switching Scheme


Key Takeaways:

  • Low-income consumers eligible for premium tax credits under the Affordable Care Act (ACA) are being targeted by unauthorized enrollments and plan switching schemes.
  • Consumers can face potential tax penalties if they received premium tax credits they didn't qualify for.
  • Unauthorized enrollments can result in disruptions in healthcare coverage, unexpected out-of-pocket costs, and loss of access to providers.
  • Reporting incidents to the Marketplace call center is crucial for seeking assistance in reversing unauthorized coverage changes.
  • Consumer protection and resources are available for victims of unauthorized enrollments.

The Affordable Care Act (ACA), also known as Obamacare, was a groundbreaking legislation aimed at making quality healthcare accessible and affordable for millions of Americans. However, with any complex system, there are opportunities for exploitation and abuse. Unauthorized ACA enrollments have become a growing concern, where individuals or entities engage in fraudulent practices to illegally enroll consumers in health insurance plans, often without their knowledge or consent.

Overview of the Alleged Money Making Scheme

At its core, this scheme involves deceptive tactics to enroll or switch ACA plans without consumer consent. Through misleading advertisements and coercive measures, individuals are tricked into unwittingly changing their healthcare coverage.

Bad acting insurance agents may convince consumers to switch their existing health insurance plans, often without fully disclosing the implications. This can result in consumers unknowingly enrolling in plans that may not meet their needs or preferences.

Additionally, these agents may exploit special enrollment periods (SEPs), which are designated times when individuals can enroll in or change their health insurance plans outside of the regular open enrollment period. By misrepresenting qualifying life events or providing false information, bad acting agents can fraudulently enroll consumers during these SEPs.

Impact on Consumers

The damages go far beyond mere inconvenience. Victims often find themselves without access to vital healthcare resources, including trusted doctors, specialists, and essential medications. The financial toll can be crippling, leaving families burdened with unexpected expenses.

Low-income consumers are particularly vulnerable, as they may be eligible for premium tax credits and other financial assistance programs. These low-income consumers are being targeted through Facebook, Google and TikTok ads, promising free money to pay for gas, groceries and rent, but instead these bad acting agents are enrolling them in unsuitable or unauthorized plans.

The consequences of unauthorized plan changes can be severe, including:

  • Disruptions in healthcare coverage
  • Unexpected out-of-pocket costs
  • Loss of access to preferred healthcare providers

Tax Penalties and Corrected Form 1095-A

Beyond the immediate impact on healthcare coverage, victims of unauthorized ACA enrollments and plan switching schemes may face tax-related problems down the line. The 1095-A form is a critical document used to reconcile premium tax credits and report healthcare coverage information to the Internal Revenue Service (IRS).

If consumers received premium tax credits for which they didn't qualify, they could find themselves liable to repay those funds to the IRS. This unexpected financial burden drives home the importance of prompt action in addressing unauthorized plan changes.

Consumer Rights and Choices

Empowering consumers to report unauthorized activities and helping with the reversal of unauthorized coverage changes are crucial steps towards rectifying the harm inflicted. Additionally, avenues for seeking compensation must be readily accessible.

Marketplace Call Center and Reporting Incidents

The Marketplace call center plays a crucial role in addressing unauthorized ACA enrollments. Consumers who suspect they have been victims of such activities should contact the Marketplace immediately to report insurance fraud.

By reporting unauthorized enrollments, affected consumers can initiate the process of disenrolling from unauthorized plans and potentially mitigating any associated financial or legal consequences.

The Marketplace call center can also provide guidance on the necessary steps to take, such as filing complaints with relevant authorities.

Impact on Legitimate Insurance Agents

Legitimate insurance agents suffer collateral damage, facing loss of commissions due to unauthorized plan switches. Insurance agents/brokers should report suspected fraudulent activities to CMS, the Marketplace, and the affected client’s Department of Insurance to uphold industry integrity.


Unauthorized ACA enrollments represent a significant threat to the integrity of the healthcare system and the well-being of consumers. By understanding the tactics employed, the potential consequences, and the available resources, individuals can take proactive measures to protect themselves from falling victim to these fraudulent activities.

Vigilance, education, and a commitment to consumer protection are crucial in combating unauthorized ACA enrollments. As the healthcare landscape continues to evolve, it is imperative for all stakeholders – consumers, healthcare providers, insurers, and regulatory bodies – to collaborate and implement robust measures to safeguard the rights and interests of those seeking affordable and accessible healthcare.


What are unauthorized ACA enrollments?

Unauthorized ACA enrollments and plan switching schemes involve deceptive advertisements and bad acting agents used to enroll individuals in or switch their Affordable Care Act (ACA) plans without their consent.

How widespread is this plan switching issue?

This scheme operates across multiple states. With potentially hundreds of thousands of affected individuals, it has prompted the initiation of a class-action lawsuit to address the collective grievances.

What should I do if I suspect an unauthorized ACA enrollment?

Immediately report the incident to the federal marketplace, your healthcare provider, and your state’s Department of Insurance.

Can unauthorized enrollments affect my eligibility for premium tax credits?

Yes, unauthorized enrollments can lead to inaccurate information being used to calculate your premium tax credits, potentially resulting in penalties during tax season.

What are the tax penalties associated with unauthorized enrollments?

Tax penalties may be imposed on individuals who fail to maintain ACA-compliant health insurance coverage or who incorrectly report their coverage status due to unauthorized enrollments.

How can I avoid falling victim to unauthorized enrollments and plan switching?

  • Do not fill out any forms promising monthly subsidies or benefits for gas, groceries, rent, or other expenses, as these are scams attempting to obtain your personal information.
  • Be extremely cautious of any unsolicited phone calls or emails claiming to be from the government, healthcare providers, or insurance companies.
  • Never provide personal information, such as your Social Security number, bank account details, or health insurance information, unless you have initiated the interaction and verified the organization is legitimate.

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Health Insurance Marketplace (For Consumer Reporting): Call 1-800-318-2596 and say “report fraud.”

NAIC Online Complaint Form: You can use the National Association of Insurance Commissioners’ (NAIC) Online Fraud Reporting System here to connect with the local Department of Insurance to file a report.

Department of Health and Human Services (HHS) Complaint: Report online at HHS Fraud Report