On Saturday, the administration said it would suspend a program that was set to pay out $10.4 billion to insurers for covering high-risk individuals under Obamacare a year ago, saying that a recent federal court ruling prevents the money from being disbursed. Another federal judge upheld the risk adjustment formula in a separate case filed in MA. Last year, in addition to reducing money to navigator groups, the Administration cut funding for promotion of the law by $90 million.
One of the great ironies of the Affordable Care Act is that progressives wanted to stick it to the insurers and instead have enriched them with new business. But a month later a federal judge in New Mexico said it was. The administration could just as easily have listened to a judge in MA who ruled the opposite way or awaited the results of an appeal. It is clear that the target is not the individual mandate-which in fact funnels millions of dollars from paying customers to the insurers' coffers-but the health care legislation itself. These are people who are not going to go to an insurance agent or broker.
The president last fall also issued an executive order to try to make it easier for individuals and small businesses to buy health plans that cost less than ACA coverage because they cover fewer medical services and bypass the law's rules meant to protect people from old insurance practices in which companies had charged higher prices to women, older people, and those with preexisting medical conditions.
Navigator groups that have helped people sign up for health insurance since Obamacare coverage began in 2014 said the funding cuts will be hard to absorb. In other words, the Trump Administration position in court is in favor of making the payments. "The administration has said they were disappointed with the New Mexico ruling, and they want to work it out", said Greg Fann, consulting actuary for Axene Health Partners and fellow of the Society of Actuaries.
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These plans, however, aren't required to have the same consumer protections as ACA policies. The administration is also pushing to broaden the definition of short-term insurance, which is also exempted from the ACA's rules. The counselors, known as navigators, help consumers find an affordable health plan on the ACA exchanges.
Signaling the administration's long-term objectives, Andrew Bremberg, who oversees domestic policy at the White House, told reporters a year ago, "The president still firmly believes that Congress must act to repeal and replace Obamacare, but before that can be done, this administration must act to provide relief". The government uses a similar approach with Medicare private insurance plans and the Medicare prescription drug benefit.
America's Health Insurance Plans, another large industry group, declined to comment. That's because many ACA customers will qualify for federal government premium subsidies, which are still alive and well in Obamacare. The latest administration action could disrupt the Affordable Care Act, the health care law that has withstood President Donald Trump's efforts to completely repeal it. Until now, the grants have been used only to help people choose and buy ACA health plans or to help steer people with low incomes toward Medicaid. The other half are covered by expanded Medicaid.