Multiple health insurers won lawsuits against the federal government this week to recover unpaid cost-sharing reduction payments.
Three similiar cases were before Judge Margaret Sweeney in the U.S. Court of Federal Claims. Sweeney on Friday ruled that the federal government owes Maine Community Health Options the CSRs that it failed to pay in 2017, which the insurer said amounts to $5.7 million.
She also ruled in favor of Community Health Choice and Common Ground Healthcare Cooperative, which was granted class-action status in April 2018. Common Ground estimated it is owed $12 to $13 million in unpaid CSRs for 2017 and $60 million for 2018, while Community Health alleged it is owed $11.2 million for 2017.
And on Thursday, Judge Thomas Wheeler of the same court similarly ruled that the federal government must reimburse L.A. Care Health Plan for about $6 million in unpaid 2017 CSR payments.
Both judges determined that the government violated its statutory obligation to pay the CSRs—a type of subsidy that insurers use to reduce deductibles and copayments for low-income individuals who buy coverage on the Affordable Care Act exchanges. The Trump administration abruptly quit making those payments in October 2017, prompting insurers to raise premiums to make up for the loss.
At the time, the National Association of Insurance Commissioners said ending the CSRs would cost insurers $1 billion in 2017 alone.
"The government promised to make full and advanced CSR payments both in statute and through contract for which it is now liable. L.A. Care should not be left 'holding the bag' for taking our Government at its word," Wheeler concluded in his opinion.
Last year, Judge Elaine Kaplan ruled in favor of Montana Health Co-op and Sanford Health Plan in the first two CSR cases to be decided. Montana Health's case is pending on appeal in the U.S. Court of Appeals for the Federal Circuit.