Insurer Scores A $200M Court Win After GOP Move To Block O'Care Payments

[DonViejo]

Source: Talking Points Memo



By TIERNEY SNEED Published FEBRUARY 10, 2017, 2:02 PM EDT

An Oregon-based insurer scored a $214 million court victory this week in a case brought after congressional Republicans in 2014 hobbled the federal government's ability to fund an Affordable Care Act program.

The program, known as risk corridors payments, sought to blunt some of the risk insurers were taking on in the first three years of Obamacare's implementation. The program shifted money from insurers that over-performed on expectations to those that underperformed. However, GOP lawmakers inserted an amendment in must-pass legislation barring the government from drawing funding for the program from elsewhere in the Department of Health and Human Services to make up any shortfalls between the money collected from insurers and the money owed. (Florida's GOP Sen. Marco Rubio, pictured above, led the charge against the risk corridors program.) As a result, insurers, on average, have received around 12 percent of the payments they have been owed.

A U.S. Court of Claims ruled Thursday that the feds had "breached the contract by failing to make full risk corridors payments as promised," and handed over to the Oregon insurance company Moda the $214 million summary judgement:

There is no genuine dispute that the Government is liable to Moda. Whether under statute or contract, the Court finds that the Government made a promise in the risk corridors program that it has yet to fulfill. Today, the Court directs the Government to fulfill that promise. After all, “to say to Moda, ‘The joke is on you. You shouldn’t have trusted us,’ is hardly worthy of our great government.” Brandt v. Hickel, 427 F.2d 53, 57 (9th Cir. 1970).

Read more: http://talkingpointsmemo.com/dc/risk-corridors-to-lawsuit

[tenorly]

1. They should hit up Narco Rubio for some of that yeyo money.

I'm sure he and his in-laws are good for it.

[Phoenix61]

2. Rubio has got to go

[yallerdawg]

3. All part of shafting the little people.

If the insurers don't fund "the risk," premium increases do!

So, rising costs underfunded the program (of course) and premiums had to rise (of course).

If it wasn't screwing US so badly, you could call this a successful plan.

[Yupster]

4. Are we now in favor of insurance company bailouts?

I thought we were against them?

[yallerdawg]

5. The ACA guaranteed a specific profit margin for insurers after medical costs were covered.

The Republicans - well aware of what they had designed and supported for decades and how Romneycare actually worked - knew exactly how to sabotage the ACA.

Through a variety of tweaks, the Republicans screwed over the insurers and guaranteed they would need higher premiums on usjust to break even until the funds became available through the recovery program. Many insurers have dropped out - they don't believe they can make a profit under these conditions, especially with a now uncertain future for ACA.

It is not a bailout when you honor your agreements and contracts.

[Hortensis]

6. As yallerdog says. This is fulfilling a

contracted agreement designed to lessen the risk of entering the ACA's new, uncharted markets. Insurance companies have a legal fiduciary duty to their shareholders to perform adequately. This was meant to help them do that if the projections they entered with turned out to be wrong.

And of course those trying to destroy the ACA chose to renig on this provision, then claim the ACA couldn't work, as evidenced by insurance companies withdrawal.

[Yupster]

7. Is there some limit to how much we're on the hook for every year?

Id there a limit to the law, or is this just a bottomless pit of payoffs to insurance companies?

Are they not the bad guys any more?

[Hortensis]

8. Yes, there are limits, and this is only for the rollout,

until experience data are available. And they were never all completely bad guys, but working within a bad system where all had to compete with bad guys certainly encouraged bad practices.

Forgive me if I should recognize that you're joking/provoking, Yupster. I certainly suspect it.