Just as more insurers and consumers were entering the ACA individual market and things seemed to be stabilizing, the Trump administration struck a new blow against the health-care sector over the weekend, cutting off the multi-billion dollar risk adjustment payments that compensate insurers for taking on sicker and more expensive patients.
The payments were created to stop insurers from losing money on very sick patients, who cost the most to treat. It discourages companies from trying to save money by cherry-picking the healthiest people and kicking others to the curb.
Not only is the administration gutting the program, it's making them help people enroll in the plans Trump has concocted that don't comply with the consumer protection standards and other requirements of the law.
The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely referred to as "Obamacare", outside the Jackson-Hinds Comprehensive Health Center in Jackson, Mississippi, U.S. on October 4, 2013.
One of the most popular parts of the Affordable Care Act: the fact no one can be denied coverage, regardless of pre-existing conditions.
While imperfect, the risk adjustment program "has helped promote market stability over the past five years", Wehrle said. There is a high likelihood that the court's decision will be appealed- primarily after a different court in MA endorsed the payments.
The Centers for Medicare and Medicaid Services (CMS) will be offering $10 million in funding this year to groups that will help navigate 2019 enrollment for the Affordable Care Act, CMS said to a statement Tuesday.
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The cost of any increase in premiums that results from the risk adjustment payments may come from taxpayer dollars.
CareSource, which will offer insurance in 79 of Indiana's 92 counties in 2019, would have gone from being a net receiver of money from the pool to paying about $16 million a year to other insurers - that is, until the freeze went into effect.
The Florida group will need to make hard choices about who they serve during open enrollment period that begins in November. The administration is also pushing to broaden the definition of short-term insurance, which is also exempted from the ACA's rules.
"So much uncertainty put in the market at this point of time is very unnerving", said Ritu Agarwal, senior associate dean of research at the University of Maryland Robert H. Smith School of Business, who follows the health care system. Supporters of the health law called the move another sign of the administration's determination to undermine the ACA.
CMS said in a statement that the funds were being cut because people are more familiar with the exchange program, and that the programs enrolled less than 1% of participants a year ago.
Though insurers may eventually get the funds once the administration revises the formula, the move is sending shudders through the industry. The announcement comes in the midst of the annual rate-filing period when insurers announce their estimated premium prices and plans for coverage to state regulators.
Insurance Commissioner Al Redmer Jr. said that as of now he doesn't expect the latest decision to interrupt the state's rate-setting process. The agency has worked with insurers to address their concerns and to adjust the formula under both the Obama and Trump administrations. 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.