Trump Administration Freezes Payments Required By The Affordable Care Act
Trump Administration Freezes Payments Required By The Affordable Care Act
Justin Sullivan Getty Images North America
11 July, 2018, 05:22
But since the Trump Administration removed the fine for not buying health insurance, Republicans argue that the removal of the threat of that "tax" now makes the law unconstitutional. The federal Centers for Medicare & Medicaid Services - known by the abbreviation CMS - will temporarily stop so-called "risk-adjustment payments" used to steady Obamacare health insurance premiums.
At stake is more than $10 billion in "risk adjustment" payments - a feature of the 2010 health law that requires insurers with healthier consumers to reimburse plans that end up with costlier, sicker patients, so the market balances out.
The Trump administration's decision to freeze billions in payments to health insurers with plans under Obamacare that cover a higher number of sicker patients could cause health care premiums to rise in 2019.
"People spin the administration's decision as Trump trying to do harm, but it's exactly the opposite", he added.
The move sent shock waves through the insurance industry, which claimed that such market disruption could have near-immediate consequences for insured populations. "That will increase competition, and competition will help keep prices down".
However, the trade group America's Health Insurance Plans (AHIP) said in a statement that the recent move would lead to uncertainty and increase premiums, putting the burden on small businesses and consumers.
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The president last fall also issued an executive order to try to make it easier for individuals and small businesses to buy health plans that cost less than ACA coverage because they cover fewer medical services and bypass the law's rules meant to protect people from old insurance practices in which companies had charged higher prices to women, older people, and those with preexisting medical conditions.
"This decision comes at a critical time when insurance providers are developing premiums for 2019 and states are reviewing rates".
This is distinct from the debate over ObamaCare's cost-sharing payments, which the Trump Administration cut off a year ago after a federal judge barred the subsidies that Congress had not appropriated.
Similarly, past year the Trump administration ended Obamacare's cost-sharing reduction payments to health insurers. In 2013, CMS finalized a risk adjustment methodology for states that uses the statewide average premium in order to maintain a budget-neutral program. On the same day, Minuteman Health, Inc. filed a similar complaint in district court in MA. But another district court in MA upheld the formula. The CMS, which noted that a federal court in MA found its formula fair, has asked the New Mexico court to reconsider its decision and said it is seeking a quick resolution to the legal issue. The CMS has asked Judge Browning to reconsider his ruling and is awaiting a decision.
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