Trump freezes Obamacare payment program

[Swordsmyth]

The Trump administration is freezing a critical Affordable Care Act (ACA) insurance payment program that discourages insurers from cherry picking healthier enrollees by compensating them for sicker ones.
The move could rattle insurance companies at the very moment when they’re deciding whether to continue selling ACA plans and setting premiums for 2019. It’s not immediately clear what this means for ACA enrollees, if anything.
The news comes after (https://www.wsj.com/articles/trump-administration-expected-to-suspend-aca-program-related-to-insurer-payments-1530930606)the Wall Street Journal reported they might suspend the program:

The suspension of some payouts under the program, known as risk adjustment, could come in the wake of a recent decision by a federal judge in New Mexico, who ruled that part of its implementation was flawed and hadn’t been adequately justified by federal regulators, people familiar with the plans said.
“We were disappointed by the court’s recent ruling. As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold,” said the Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma in a statement released (https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2018-Press-releases-items/2018-07-07.html) on Saturday. “CMS has asked the court to reconsider its ruling, and hopes for a prompt resolution that allows CMS to prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.”

CMS argues the ruling prevents it from making further collections or payments in the risk adjustment program, including amounts for the 2017 benefit year which amount to $10.4 billion, until the litigation is resolved.


Ending the risk adjustment program or temporarily freezing payments could unnerve insurers who thought they were in for a relatively calm ACA season. CMS added in its statement that it will issue guidance shortly on how insurers should treat the news, in terms of financial losses.
Georgetown health policy expert Edwin Park said (https://twitter.com/EdwinCPark/status/1015612549725745152) should the risk adjustment program end, insurers over the long run “would be forced to sharply raise premiums or reconsider participation.”

More at: https://thinkprogress.org/trump-might-end-obamacare-payment-program-rattling-insurers-ahead-of-key-market-decisions-0ae9d3c61c52/

[oyarde]

Tax money not being spent is a good thing. Apply it to the debt.

[oyarde]

Govt should not be involved in health care .

[spudea]

I thought these were already ended last year, but I do remember insurers suing so maybe that kept it going until this recent court decision.

[Swordsmyth]

The Trump administration will resume a program that pays billions of dollars to health insurers, just weeks after sending insurers into a panic by abruptly suspending the payments.
The federal Centers for Medicare and Medicaid Services (CMS) late Tuesday said it has adopted an interim final rule that will allow the agency to provide $10.4 billion in “risk adjustment” funding to insurers to help them provide coverage to particularly sick and costly enrollees.


In a statement, CMS said that “taking immediate action to allow for the continued operation of the risk adjustment program is imperative to maintain stability and predictability in the individual and small group health insurance markets.”
The administration’s surprise suspension of the risk adjustment payments earlier this month set off a round of warnings of rising premiums and condemnation from Democrats who said it was further GOP “sabotage” of the health-care law.
This final rule makes no changes to the program, and essentially just restarts it after a short pause.
“This rule will restore operation of the risk adjustment program, and mitigate some of the uncertainty caused by the New Mexico litigation,” CMS Administrator Seema Verma said in a statement.
“Issuers that had expressed concerns about having to withdraw from markets or becoming insolvent should be assured by our actions today. Alleviating concerns in the market helps to protect consumer choices,” Verma said.
The administration cited as its reason for stopping the payments a court ruling from a federal judge in New Mexico finding that the administration had not fully justified its formula for dispensing the funds.
Experts said the payment freeze should not have a significant long-term impact, as it was resolved in only a couple weeks.
The risk adjustment program does not involve taxpayer funds. Instead, money is collected from insurers that have healthier enrollees overall and then given to insurers with sicker, more expensive enrollees to help cover their costs.

http://thehill.com/policy/healthcare/398713-trump-admin-restarts-key-obamacare-payments