Sunday, 22 July, 2018

Health care premiums could rise following Trump administration's

The Trump administration is taking another swipe at Obamacare by suspending payments to insurance companies President Trump has long promised to end his predecessor's namesake health care initiative
Johnnie Parks | 10 July, 2018, 21:25

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 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.

The Risk adjustment formula is a key component of Obamacare, allowing for market stabilization.

"As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold", CMS Administrator Seema Verma said in the agency's statement.

The flurry of activity is the result of a surprise announcement Saturday by the administration that it had suspended $10.4 billion in funding that is supposed to be paid to insurers to help them provide coverage to particularly sick and costly enrollees.

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

Trump tweeted dozens and dozens of times about Obamacare and its demise a year ago as he pushed the Senate to repeal the law.

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"The federal government's decision to suspend payment transfers under the ACA's risk adjustment program could have a significant impact on premiums and place an additional burden on people in the community who can least afford it", CareFirst's president and CEO, Brian Pieninck, said in a statement. Many agree-Democrats and Republicans-that a person with a pre-existing condition needs health insurance coverage and should not be denied on that fact.

The administration argued in its announcement that its hands were tied by conflicting court rulings in New Mexico and MA. Donald Trump's move to gut Obamacare guarantees it.

"I think insurers are going to be watching very closely what the administration says in court, and whether this is a sign of further steps to undermine the law, or a good faith effort to try to comply with the judge's order", he says.

The administration cited a federal court ruling in New Mexico that found that the administration did not properly justify its formula for dispensing the funds.

It could encourage more insurers to bow out of the Affordable Care Act.

The main insurance trade associations in Washington have been organizing calls with their member companies and trying to coordinate a response. 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.

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