Highmark sues feds over $223M in ACA payments

Highmark, the insurance arm of Pittsburgh-based Highmark Health, is suing the federal government, claiming the U.S. failed to pay the insurer nearly $223 million in payments owed under the Affordable Care Act's risk corridor program.

The risk corridor program is designed to temporarily level the financial playing field for payers by limiting both unexpectedly high gains and losses associated with participating in a new insurance market. Insurers that saw greater profits paid into a pool to compensate insurers with higher losses. The three-year program, which runs through 2016, fell short by more than $2.5 billion in its first year because so many insurers experienced losses in the individual market.

Due to the shortfall, HHS said insurers initially would only receive 12.6 percent of the money claimed under the risk corridor program for 2014. In its suit, Highmark is seeking the full amount it is owed for that year, according to The Wall Street Journal.

Regarding the suit, which was filed Tuesday, Highmark Health CEO David Holmberg told WSJ that, "All we're asking is for the federal government to do what they promised."

Highmark filed suit in the U.S. Court of Federal Claims in the District of Columbia. There is at least one other suit concerning risk corridor payments pending in that court. In February, Health Republic Insurance Co. brought a $2.5 billion claim against the federal government, and that suit is seeking class-action status.

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