A group of Republican senators introduced a bill Friday to bar the government from paying any award or settlement to the growing number of health insurers suing for funds owed to them under one of the Affordable Care Act's risk programs.
The bill, titled the “HHS Slush Fund Elimination Act,” would prohibit the administration from using any federal funds to pay insurers who are suing to collect promised payments under the controversial ACA risk-corridor program, which was meant to protect insurers from extreme losses during the early years of the public health insurance exchanges.
“We are going to repeal and replace Obamacare but, in the meantime, the last thing Americans need is for the Obama Administration to sneak in one last bailout on its way out the door," said Sen. Ben Sasse (R-Neb.), who introduced the bill along with Sens. Marco Rubio (R-Fla.), John Barrasso (R-Wyo.) and Mike Lee (R-Utah).
Risk corridors, which sunsets this year and is also part of the Medicare Part D prescription drug program, limits how much insurers can lose or gain on the exchanges. Under the program, profitable plans make payments to the government and plans with higher-than-expected medical claims receive payments. In the past two years, Congress has passed laws that require the program to be budget-neutral, so if the government doesn't bring in enough funds through the program, it can't cover the payments requested by less profitable plans.
In September, the CMS said it would not pay insurers the funds requested for 2015 because any collections would go toward paying off the 2014 risk-corridor requests. Insurers are still owed more than $2.5 billion to cover 2014 losses. Highmark and Blue Cross and Blue Shield of North Carolina are among the insurers suing to recover those payments.
In the memo, the CMS said the U.S. Justice Department is “vigorously defending” the risk corridor lawsuits brought by insurers, but said the agency is also willing to discuss resolving those suits. Several Republicans have written to HHS Secretary Sylvia Mathews Burwell demanding information on how the CMS is handling the risk corridor program and the litigation surrounding it.
In October, the DOJ asked the U.S. Court of Federal Claims to dismiss two of the lawsuits. The Obama administration claims the payments aren't due until the end of the three-year program.