The Hubs for Medicare & Medicaid Services alleged in an announcement made over the weekend that it was stopping the resolution after a state district law court in New Mexico concluded in February that the expenses incurred based on faulty regulations.
In listing examples of the kinds of groups eligible to apply for the money that remains, the CMS did not mention the grass-roots nonprofits that have done most of this work.
A former CMC head during the Obama government, Andy Slavitt, indicated on Twitter that because in the long-run there will be the eventual payment of the finances, no insurers need to pull-out from the markets or act out of context or feat at the moment.
Risk adjustment payments are meant to reduce the incentives for insurers to cherry-pick healthy consumers and weed out those with chronic illnesses and other preexisting conditions whose health costs are higher. Known as the risk adjustment program, it allocates insurance premium dollars to plans that enrolled higher risk and less healthy members from plans that enrolled lower risk and healthier members.
One of the great ironies of the Affordable Care Act is that progressives wanted to stick it to the insurers and instead have enriched them with new business. The reality is sick people do rack up more health care costs.
She noted the Trump administration views state flexibility as important, and is committed to granting as much of it as possible.
But in January, in a separate case, a federal district judge in MA upheld the government formula used to calculate the payments. "As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold". The mandate requires people without insurance from their employer or a government program to obtain health coverage or pay a penalty. The Florida group will need to make hard choices about who they serve during open enrollment period that begins in November. The Maryland Insurance Administration has a hearing scheduled for July 31. President Trump is imposing another uncertainty tax on consumers looking for health care.
America's Health Insurance Plans, the main health insurance industry trade group, said in a statement that it is "very discouraged" by the Trump administration's decision to freeze payments.
State officials, with bipartisan support from both Gov. Larry Hogan and the General Assembly, asked the federal agency this spring for permission to establish a reinsurance program that would create a $462 million fund for insurers to cover the most expensive claims. "We're now in the midst of the 2019 rate-filing process and it's not clear how the risk-adjustment program will be operating", said Cori Uccello, senior health fellow at the American Academy of Actuaries. The administration could just as easily have listened to a judge in MA who ruled the opposite way or awaited the results of an appeal. The insurers have requested average rate increases for 2019 that range from 18.5 percent to 91.4 percent, depending on the type of plan.