The Justice Department said due to an accounting error, a proposal to fully fund the ACA's risk corridors program made its way into HHS' budget. The proposed funding has since been removed, according to Inside Health Policy.
The temporary risk corridors program aimed to shield payers from losing money on mispriced products during the first years of the ACA's individual exchanges. The program, which ran from 2014 to 2016, stated plans earning more than 3 percent of premium revenue had to pay into a pool. That pool would then be redistributed to plans posting more than 3 percent losses.
Here are three things to know about HHS' budget edit concerning risk corridors.
1. In HHS' budget proposal released Feb. 12, the agency requested a mandatory appropriation to the ACA's risk corridors program of roughly $11.5 billion. The budget proposal also requested $812 million to possibly cover the cost of exempting the risk corridors program from sequester.
2. However, in a updated HHS budget submitted Feb. 19, language calling for the appropriations was deleted, according to the report. HHS blamed the mistake on an accounting error.
3. The initial budget, which included the funding, drew considerable surprise from conservative lawmakers who have long opposed the funding, and insurers who are suing HHS over the risk corridors program. Specifically, two insurers pointed out HHS' first budget didn't correspond with a DOJ ruling stating the federal government is not obligated to fund risk corridors, according to Inside Health Policy.