Obamacare 'navigator' program cut further by Trump administration

Trump Administration Halts Billions In Insurance Payments Under Obamacare

Trump Administration Halts Billions In Insurance Payments Under Obamacare

Once again, the Trump administration has taken an axe to the Affordable Care Act, temporarily suspending a program that was set to pay out $10.4 billion to insurers for covering high-risk individuals previous year.

The announcement was made by Seema Verma, the administrator of the Centers for Medicare and Medicaid Services, and was precipitated by a New Mexico court ruling that suggested the calculations for the risk-adjusted premiums were flawed even despite a MA ruling that validated them.

President Donald Trump's administration has used its regulatory powers to undermine Obamacare after the Republican-controlled Congress past year failed to repeal and replace the law. The mandate was created to stabilize the health insurance market by encouraging younger and healthier Americans to sign up for insurance, and the repeal could consequently have the opposite effect.

America's Health Insurance Plans, the trade organization representing health insurers, issued a statement saying it was "discouraged" by the decision to freeze risk adjustment payments.

The decision comes after a March 2018 court ruling that found the formula for calculating risk adjustment payments was "arbitrary and capricious".

The administration argued in its announcement that its hands were tied by conflicting court rulings in New Mexico and MA.

"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. Another court in MA had upheld the program in January.

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CMS Administrator Seema Verma says the navigators just aren't cost effective. They are now deciding which exchanges they will participate in next year and what premiums they'll charge.

Insurance companies responded quickly on Saturday with their disapproval.

The court's ruling bars the agency from collecting or making payments under the current methodology, which uses a statewide average premium, said CMS, which is part of the Department of Health and Human Services.

CMS cites the late February court ruling in deciding to place a freeze on the $10.4 billion which it collected past year, and which ordinarily would be dispersed among high-risk insurers.

For the second time in days, the Trump administration is taking action to undercut the Obama-era Affordable Care Act. "This is one of several steps the Trump administration has taken to undermine the ACA". Frank Pallone called the cuts more "sabotage" from the administration. He warned of "turmoil" as insurers finalize their rates for 2019.

The risk-adjustment program doesn't involve taxpayer money. Small insurers often complain about risk adjustment payments because they end up paying their larger competitors, who tend to have the sickest patients.

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