Last weekend, the administration announced it is freezing payments by an ACA program meant to stabilize premiums. The so-called "risk adjustment" program takes payments from insurers with healthier customers and redistributes that money to companies with sicker enrollees. But the Trump administration is hanging its decision to withhold subsidies to insurers on court decisions from New Mexico and MA which say the way those payments are handed out is too vague. The president's campaign has taken aim at the remaining fig leaves of reform in the health care legislation voted into law in 2010. But here too the insurers have threatened higher premiums, even as the insurers pocket tax-credit subsidies that increase with premiums.
This provision, called "guarantee issue", remains one of the most popular among consumers, according to numerous opinion polls.
More than 20 million people have coverage through former President Barack Obama's law.
But making guaranteed issue work is another story. "It enables the country to move away from a market where plans compete to avoid covering or charge more to people with preexisting health conditions, to one where competition is based on quality, affordable care for everyone".
In announcing a more than 70 percent funding cut from a year ago, the Centers for Medicare and Medicaid Services said in a notice that the marketplace navigator groups should be able to "stretch their funding further" with less demand for in-person assistance because the marketplace is more familiar to most Americans.
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Now that the risk adjustment payments are on hold, some state regulators fear that insurers could become less willing to participate in certain communities.
Some have said CMS is being deliberately disruptive because of its hostility to ObamaCare, and that government programs should not be at the mercy of a lone federal judge.
Citing two conflicting federal court cases on the use of statewide average premiums in its decision, CMS said it can not collect or redistribute funds for risk-adjusted payments. The government asked the court to reconsider its ruling.
That's bad news for the chronically ill, the disabled, the elderly and all others whose health care costs can run considerably higher than average.
The ambiguity involved in the conflicting New Mexico and MA rulings may mean the suspension of payments will indeed be temporary.
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Nonetheless, the timing is problematic.
So the suspension of risk adjustment payments could throw the rate-filing process into chaos, said Cynthia Fox, director of health reform and private insurance at Kaiser Family Foundation. "It's just choosing not to exercise them", he said. "This comes at a time when the market was looking really strong for 2019, and insurers were coming off a very profitable year". A spokeswoman for ConnectiCare said the insurer is "monitoring developments" related to risk adjustment payments and plans to file its 2019 small group and individual plan rates next week.
The navigators, Fann added, were needed more in 2013 and 2014 when the marketplaces were in their first years and millions of people who hadn't bought insurance before were considering the health law's new options.
Over the previous year, the White House has issued a number of executive orders and undertaken administrative actions to undercut the program popularly known as Obamacare.
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