Insurers warn of rising premiums after Trump axes Obamacare payments again

President Donald Trump speaks about health care from the White House in Washington. The Trump administration says it’s freezing payments under an Obamacare program that protects insurers with sicker patients

The Centers for Medicare and Medicaid Services (CMS), which administers ACA programs, said on Saturday that months-old conflicting court rulings related to the risk adjustment formula prevent them from making payments.

"We were disappointed by the court's recent ruling", CMS Administrator Seema Verma said in the agency's statement. It shuffles money from plans with healthier-than-average members to those with larger numbers of sicker, higher-cost members. "It moves us back to some extent to the status quo where people with pre-existing conditions found it very hard to get insurance".

"The federal government's decision to suspend payment transfers under the ACA's risk adjustment program could have a significant impact on premiums and place an additional burden on people in the community who can least afford it", CareFirst's president and CEO, Brian Pieninck, said in a statement. But another district court in MA upheld the formula.

The announcement came as insurers were awaiting an annual report that usually comes at the end of June, informing them of whether they owe money into the risk adjustment program or will be paid out for the previous year. The payments insurers expected this fall, based on their 2017 business, amounted to $10.4 billion.

The payments are meant to help stabilize health insurance markets by compensating insurers that had sicker, more expensive enrollees in 2017.

For the past five years, when insurance has been available through ACA marketplaces for people who do not have access to affordable health benefits through a job, federal health officials have started every spring working with navigator groups on plans for the coming enrollment season.

While imperfect, the risk adjustment program "has helped promote market stability over the past five years", Wehrle said. "And costs for taxpayers will rise as the federal government spends more on premium subsidies", AHIP said in a statement.


But CareFirst and Kaiser could ask to adjust their rates higher given the Trump administration's decision.

Levitt says the administration's announcement was "a little perplexing", given that the legal fight over the conflicting rulings in New Mexico and MA is still ongoing.

"Normally you would expect an administration to look for ways to minimize the uncertainty and minimize the effect as these cases play out", he says.

Tell the Republican Congress and administration to quit playing politics with our health.

"What you have to keep in mind is ultimately the intent of the administration", Whitlock says. Last month the Department of Justice decided not to defend the law in a court challenge in Texas, jeopardizing the part of the law that protects people with pre-existing conditions from being denied coverage, as NPR reported.

The Trump administration on Monday announced another nail in the coffin of Obamacare, declaring it would withhold the payment of risk-adjusted premiums to insurers. They assisted 42% of enrollees, the agency said.

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