Good thing the Senate Republicans have confirmed all those federal Judicial positions. Oh, wait...

Hat Tip To: 
David Snow

Presented without comment:

Nicholas Bagley in The Incidental Economist, December 1st, 2015:

Did Marco Rubio Kill Obamacare?

A simmering dispute over the risk corridor program has broken into the presidential campaign, with Senator Rubio crowing that an arcane budget move has “kill[ed] Obamacare” and “saved the American taxpayer $2.5 billion.” On account of that move, health plans are set to receive only pennies on the dollar from the risk corridor program, which was supposed to cushion them from big losses.

...The administration has vaguely said that it will “use other sources of funding for the risk corridors payments, subject to the availability of appropriations.” But the budget bill limits the administration’s power to dip into other funds, and a Republican-controlled Congress isn’t likely to appropriate money for a program that’s been decried as an insurer bailout.

But there’s another option, one that hasn’t received much attention. When Congress creates an entitlement directly in legislation, the person who’s supposed to get the entitlement can file a lawsuit in the Court of Federal Claims to recover what she’s owed.

...The same principle holds (1) where Congress vests a federal agency with the power to obligate the United States to make certain payments and (2) the agency welches on those obligations. Here, the ACA instructs HHS to create a risk corridor program requiring the government to pay health plans a given amount of money. If the past is any guide, plans should be able to sue if HHS doesn’t pay them in accordance with the program. That’s so whether or not Congress has appropriated money to fund the program.

Nick Budnick in the Portland Tribune, February 25th, 2016:

Health Republic Insurance Company of Oregon, a Lake Oswego-based insurer that is phasing down its operations, on Wednesday filed a $5 billion class action lawsuit on behalf of insurers it says were shorted by the federal government under an Obamacare program.

The lawsuit, filed in the United States Court of Federal Claims, focuses on a program that was intended to offset insurer losses in the early years of the implementation of the Patient Protection and Affordable Care Act.

Instead, payments to insurers under the “risk corridor” program amounted to 12.6 percent of the amount expected for 2014, and are expected to be similarly low for 2015.

Federal law and regulations "are unequivocal about the payments the Government must make," according to the lawsuit. "The law is clear: the Government must abide by its statutory obligations."

Bob Herman in Modern Healthcare, May 17, 2016:

Health insurer Highmark is suing the federal government to recover money owed under the risk-corridor program for plans sold on the Affordable Care Act's insurance exchanges.

The lawsuit, filed in the U.S. Court of Federal Claims, argues Highmark is owed at least $223 million in risk-corridor payments. The ACA established risk corridors and two other risk-mitigation programs to help insurers weather the uncertain environment in the first few years of expanded health coverage.

However, Republicans in Congress stymied the risk-corridors program, calling it an insurance industry bailout, thereby allowing HHS to pay only 12.6% of risk-corridor payment requests for 2014. The same will hold true for 2015 risk-corridor payments. Medicare Part D has its own version of risk corridors.

HHS has reiterated its desire to make health plans whole, but so far has not been able to pay out anything beyond what has been appropriated.

Jeff Manning in The Oregonian, June 1, 2016:

Moda Health Plans on Wednesday became the third insurer in the country to sue the federal government, saying the company could have averted nearly-fatal fiscal problems if the government delivered $180 million in financial assistance it had promised.

The Portland insurer filed the complaint in the U.S. Court of Claims in Washington, DC, arguing it was counting on the $180 million as part of the Affordable Care Act.

...Government officials devised the Risk Corridor program as a way to encourage insurance industry participation despite the unknowns. Moda says the Centers for Medicare and Medicaid Services pledged to Moda $89.4 million for 2015 and $101.8 million in 2016.

...Executives didn't realize until October that Congressional Republicans had managed to quietly kill off the Risk Corridor program. They inserted a provision into a 2014 spending bill that ended up limiting the payments.

Sen. Marco Rubio helped kill the federal financial assistance Moda was counting on.

Led by Sen. Marco Rubio, the Republicans claimed credit for averting a $2.5 billion taxpayer bailout of the insurance industry and pounding a stake into the heart of the Affordable Care Act.

Instead of the $191 million it was counting on, Moda received just $11.2 million.

"We would have been fine if that money had shown up," Gootee said. "We wouldn't have gone through any of what we went through over the past six months."

Mitch Greenlick, an influential state legislator, said Moda fell victim to partisan politics. "I just can't believe what Rubio instigated and the federal government did -- essentially reneging on those promises,"said OGreenlick, D-Portland, who was briefed on the complaint. "The insurance companies were left holding the bag. It just about put Moda out of business."

JUNE 2ND, 2016:



Plaintiff Blue Cross and Blue Shield of North Carolina (“Plaintiff” or “BCBSNC”), by and through its undersigned counsel, brings this action against Defendant, the United States of America (“Defendant,” “United States,” or “Government”), and alleges the following:


1. BCBSNC brings this action to recover damages owed by Defendant for violations of the mandatory risk corridor payment obligations prescribed in Section 1342 of the Patient Protection and Affordable Care Act (“ACA”), and its implementing federal regulations, as well as Defendant’s breaches of its risk corridor payment obligations under express or implied-in-fact contracts, Defendant’s breaches of the covenant of good faith and fair dealing implied in Defendant’s contracts with BCBSNC, and Defendant’s taking of Plaintiff’s property without just compensation in violation of the Fifth Amendment of the U.S. Constitution.

2. Congress’s enactment in 2010 of the ACA marked a major reform in the United States health care market.

3. The market reform extended guaranteed availability of health care to all Americans, and prohibited health insurers from using factors such as health status, medical history, gender, and industry of employment to set premium rates or deny coverage.

4. The ACA introduced scores of previously uninsured or underinsured citizens into the health care marketplace, creating great uncertainty to health insurers, including Plaintiff, that had no previous experience or reliable data to meaningfully assess the risks and set the premiums for this new population of insureds under the ACA.

5. Congress, recognizing such uncertainty for health insurers, included three premium-stabilization programs in the ACA to help protect health insurers against risk selection and market uncertainty, including the temporary risk corridors program, which mandated that health insurers be paid annual risk corridor payments based on a statutorily prescribed formula to provide health insurers with stability as insurance market reforms began.

And so it goes.