Supreme Court to hear $12B ACA insurance funding dispute

Morgan Haefner - Print  | 

The Supreme Court agreed to hear a challenge led by health insurers seeking billions in government payments related to the ACA insurance exchanges, according to Politico.

In their challenge, the insurance companies argue they are owed billions in risk corridors payments. Risk corridors payments, which expired in 2016, aimed to protect insurers from large deficits as they enrolled sicker members into their new individual exchange policies. While the program intended to ensure insurers whose customers were more expensive than expected received payments while insurers with lower costs paid into the program, more insurers ended up needing payments than anticipated.

Republicans blocked the federal government from making the risk corridors payments, arguing it was a bailout for insurance companies. The insurers sued and collectively argue they're owed more than $12 billion in risk corridors payments.

The Supreme Court's action will only affect three small insurers, but its ultimate decision may dictate the future of other similar cases, according to Politico.

In May, the Department of Justice said health insurers shouldn't receive the payments. Should the Supreme Court side with insurers, the Trump administration could be forced to pay billions to insurers under the ACA, a law it is trying to dismantle, according to the report.

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