Once again, the Trump administration has taken an axe to the Affordable Care Act, temporarily suspending a program that was set to pay out $10.4 billion to insurers for covering high-risk individuals previous year.
The federal court ruling prevents the agency, which administers the Obamacare risk-adjustment program, from making further collections or payments, including those for the 2017 benefit year, until the litigation is resolved, the agency said. The payments insurers expected this fall, based on their 2017 business, amounted to $10.4 billion.
Health insurers say it is a move that could drive up premium costs and create marketplace uncertainty.
It has also scaled back the advertising budget for Obamacare healthcare plans during the open-enrollment period by about 90 percent. America's Health Insurance Plans said it was "very discouraged" by the CMS' decision, which comes as insurers determine their premiums for 2019 and states review those proposals.
CMS provided a timeline, noting that after the February 28 decision by the New Mexico federal court, it filed a motion for reconsideration, and on June 21 the court held a hearing on it. CMS is waiting for the court's ruling, it said.
"This decision will have serious consequences for millions of consumers who get their coverage through small businesses or buy coverage on their own". "It will undermine Americans' access to affordable coverage, particularly those who need medical care the most". CMS has made no public statements regarding policy changes for the risk-adjustment payments as of yet.
The Kaiser Foundation says the program "encourage insurers to compete based on the value and efficiency of their plans rather than by attracting healthier enrollees". In June, the administration said it wouldn't defend central portions of Obamacare in federal court, claiming that key provisions should be invalidated and that the individual mandate is unconstitutional. The move brought a sharp response from health insurers warning of market disruptions and higher costs.
FILE PHOTO: A man fills out an information card during an Affordable Care Act outreach event hosted by Planned Parenthood for the Latino community in Los Angeles, California September 28, 2013.
Trump continues to attack Obamacare even as almost a dozen insurers have started to warm to the program with at least a dozen states seeing an increase in the number of insurers participating in the healthcare exchange. Last year, the administration halted important subsidies for insurers.
These moves are prompting some insurers to request premium hikes for 2019 in the double digits.
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