Republicans may not be very good at governing, but they are world-class at exploiting racism. It is a proud tradition dating back more than half a century.

In the 1960s, Richard Nixon yelled about “soft-on-crime” Democrats to get into the White House. Reagan pushed his stories about the welfare queen driving to pick up her check each month in a new Cadillac. The senior Bush used Willie Horton, a convicted murderer in Massachusetts who was given a furlough from prison on which he committed a series of brutal crimes. 

Donald Trump’s foray into national politics began by inventing a Kenyan birth certificate for President Obama. His last campaign centered on pet-eating migrants, along with schools that turn children from boys into girls during recess. 

Anyhow, with the economy and Trump’s Iran War both going badly, the Republicans are again doubling down on racism. This time, the cry is “fraud,” which they insist is massive in Medicare, Medicaid, and in the Affordable Care Act (ACA) exchanges. 

Not only is the latest round of accusations almost completely evidence-free — pretty much the norm for most Republican claims — it doesn’t even make any sense. In contrast to claims that people might cheat on things like TANF, food stamps, or small business loans, beneficiaries of these programs get no direct benefit from cheating, other than possibly getting health care provided for which they were not entitled.

This takes an even more bizarre twist in the claims being pushed now by HHS Secretary RFK Jr. and Dr. Mehmet Oz, the Director of the Centers for Medicare and Medicaid Services. RFK Jr. claims that 1 million people have insurance on the exchanges without identifying Social Security numbers. Dr. Oz claims that 40 percent of the people in the ACA exchanges never filed a claim.

Dr. Oz’s evidence of fraud isn’t quite the slam dunk he seems to believe. According to the Employee Benefit Research Institute, 20 percent of the people with employer-provided insurance don’t file any claims in a year. 

Since the average period people have a policy in the exchanges is just 8 months, we would expect 30 percent of beneficiaries never to file a claim, if its population were the same as it is for employer-provided insurance. But we know that the age distribution in the exchanges skews younger, which means that they would be less likely to file claims than people getting employer-provided insurance. This means there is nothing obviously suspicious about Dr. Oz’s factoid.

But beyond the questionable status of these claims, the question is, who is committing fraud? If there is a fake policy in someone’s name, and they never even file a claim, how are they benefiting?

There are intermediaries who match people to plans in the ACA exchanges. These people get between $15 and $30 per member per month. That does provide an incentive to push phony policies, although it’s not clear anyone will get too rich this way. One hundred phony policies would get someone between $1,500 and $3,000 a month. We would want to crack down on this fraud, but $36K a year is not exactly big bucks.

The real bucks would be in the hands of the insurers. The average plan in the exchanges costs around $600 a month, or $7,200 a year. Insurers don’t have to worry about paying out much in premiums on fake plans. That means they can pocket the full $7,200 paid by the government. If they have an agent who gave them 100 fake plans, they can pocket $720,000 a year. A thousand agents getting them fake plans at this rate would net them $720 million, which is real money even for a large insurance company.

It’s not clear how big a problem fake plans are, but it is clear that the main beneficiaries are the big insurance companies. And while we can’t expect insurance company CEOs making tens of millions of dollars a year to be very sharp, if their companies are pulling in hundreds of millions of dollars a year from fake policies, surely they have some idea. 

This means that if RFK Jr., Dr. Oz, and the rest of the Trump administration are serious about cracking down on fraud in the ACA exchanges, we should be looking to see some of the CEOs of the major insurance companies doing a perp walk. And Republicans do know about insurance companies defrauding the government, since Senator Rick Scott was involved with the largest Medicare fraud at the time when he was CEO of HCA. 

Locking up insurance company CEOs may not be the fraud that the Trump administration want us to envision, but it is likely the fraud that would be closer to reality, even if all the perps are white.