Trump administration freezes Obamacare payments, citing court decision

Grant Boone
July 10, 2018

"Suspending the Risk Adjustment Program is the Trump administration's latest attempt to do administratively what they couldn't do legislatively: dismantle the Affordable Care Act", he said. Initially, the decision could affect $10.4 billion in payments tied to the 2017 benefit year, .

Under the risk adjustment program, insurers with healthier patients pay those with sicker patients.

Many Trump followers often cheer cuts to Obamacare, not knowing that the Affordable Care Act and Obamacare are one in the same.

Risk adjustment is a key aspect of market stabilization under the ACA, also known as Obamacare.

"As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold", she said.

America's Health Insurance Plans (AHIP), the trade organization representing health insurers, decried the suspension of the payments.

CMS plans to appeal the court's ruling, as the U.S. District Court for the District of MA ruled to uphold the payments.

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Similarly, past year the Trump administration ended Obamacare's cost-sharing reduction payments to health insurers. "And costs for taxpayers will rise as the federal government spends more on premium subsidies".

The administration argued in its announcement that its hands were tied by conflicting court rulings in New Mexico and MA. The ruling from New Mexico US District Court Judge Thomas Browning, says the federal government has been using an "arbitrary and capricious" method to determine payments.

The move is expected to add to premium increases next year.

"We were disappointed by the court's recent ruling", said CMS Administrator Seema Verma. "It moves us back to some extent to the status quo where people with pre-existing conditions found it very hard to get insurance".

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.

"Republicans are doing a bang up job ensuring they are properly blamed for health care rate hikes this fall", Matt House, a spokesman for Senate Democratic Leader Chuck SchumerCharles (Chuck) Ellis SchumerAn end game on Supreme Court nominations Liberals forget Constitution as Supreme Court battle fires up Anti-Trump protesters sing national anthem outside rally MORE (N.Y.), said in a Monday tweet".

It could also encourage more insurers to bow out of Obamacare. "This is one of several steps the Trump administration has taken to undermine the ACA". Eventually, experts say, some insurers could simply get fed up and exit ObamaCare markets, leading to fewer choices for consumers.

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