Dec 10, 2019

The ACA heads back to the Supreme Court

Illustration: Sarah Grillo/Axios

A group of insurers will make their case to the Supreme Court today for billions of dollars in Affordable Care Act payments.

Driving the news: The court will hear oral arguments in a long-running dispute over the ACA’s risk corridors program. Insurers say they’re owed billions of dollars from that program; the government says it doesn’t have to pay.

Why it matters: The implications for the ACA are modest, but it's a lot of money for these insurers — about $12 billion, all told.

Risk corridors were designed to even out the ACA’s early days. Insurers with a better-than-expected experience in the exchanges paid in, and that money was then paid out to insurers that had a worse-than-expected launch.

  • The amount the program was supposed to pay out exceeded the amount insurers had paid in. The assumption, at the time, was that the Department of Health and Human Services (HHS) would make up the difference itself.
  • But then Congress passed an appropriations rider saying HHS couldn’t use its own money to cover risk-corridors payments, leaving billions of dollars unpaid.

Insurers sued, claiming HHS had essentially reneged on a promise, only after insurers put themselves on the line in a new marketplace under the expectation that this safety net would be there.

The other side: The government argues that “Congress did not expose the federal fisc to that massive liability” — that it never intended to create an open-ended expense “based on criteria that depended largely on the insurers’ own business judgments.”

Go deeper: The return of the ACA wars

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SCOTUS seems to side with insurers in ACA risk corridor case

Photo: Grant Faint/Getty Images

The Supreme Court appeared to side with insurers over their claim that the federal government owes them $12 billion in Affordable Care Act risk corridor payments, AP reports.

Between the lines: The program was included in the ACA to help protect insurers participating in its new marketplaces from financial losses, but Congress inserted provisions into spending bills limiting those payments.

Go deeperArrowDec 11, 2019

Government funding bill deal will repeal key ACA taxes

Photo: Yasin Ozturk/Anadolu Agency via Getty Images

Congress is expected to soon announce a deal to repeal the Affordable Care Act's health insurance, medical device and "Cadillac" employer health plan taxes — and to raise the smoking age to 21, according to a senior House Democratic aide familiar with talks.

Why it matters: The decision is a colossal win for the health care industry.

Go deeperArrowUpdated Dec 16, 2019

Cigna's big divestiture on its life and disability insurance business

Photo: Julia Rendleman/Getty Images for Eventive Marketing

Cigna finally pulled the trigger on selling its life and disability insurance business, netting $5.3 billion after taxes from New York Life.

The big picture: Health insurers have been divesting products that have less to do with actual medical care and instead combining with companies that sell drug benefits

Go deeperArrowDec 19, 2019