Risk Adjustment Freeze

2018 MIDTERM ELECTION

Time: D H M S

Holy guacamole. I've noted repeatedly that unlike last fall, when average rate increases of 20-30% or more were commonplace for ACA individual market policies (due mainly to Trump cutting off CSR reimbursement payments), the preliminary rate requests for 2019 are actually averageing quite a bit lower than originally expected; of the 20 or so states I've crunched the numbers for so far, the weighted average for unsubsidized premium hikes is hovering around the 10% mark.

At first glance, it may sound like Democrats have been overplaying their hand when it comes to the "individual mandate repeal/short-term plan expansion is causing massive hikes!" attack. However, the rate increases from deliberate sabotage are happening...they're just being partly cancelled out by other factors, including:

Over the weekend, CMS dropped a big bombshell on everyone: In response to a federal judge siding with a small insurance carrier in New Mexico in a lawsuit over the formula for the ACA's Risk Adjustment (RA) formula, the Trump Administration has decided not to transfer any RA funds for the 2017 calendar year to anyone until...well, I'm not sure exactly, but for the foreseeable future.

Pretty much expert on how the RA program (and the law) has indicated that this is completely unnecessary; there's several responses at CMS's disposal which wouldn't require throwing the entire industry into a panic (yet again). Regardless, this is where we're at.