The Trump administration indicated that it plans to continue the Affordable Care Act’s cost-sharing subsidies while they are part of ongoing litigation, one administration official said Monday, in what may be the clearest statement on the issue so far.
The precedent that the cost-sharing subdues would be funded while the lawsuit is being litigated remains the policy of the current administration, according to the official, who spoke on conditions of anonymity.
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On June 21, 2017, health insurers have to decide whether they will sell coverage on the Obamacare marketplaces. “It will give us the first indication of what the ballpark rate increases are, what counties have insurers and which ones don’t,” says Robert Laszewski, an industry consultant who works with insurers that sell on the marketplace. “Insurers will have to make a statement.” The number of insurers selling on the marketplace fell significantly this year. There are 960 counties on Healthcare.gov that had just one health insurer selling coverage in 2017. That was a big increase from the 180 counties in the same situation in 2016.
Another insurer sued the U.S. government to recoup unpaid payments under the ACA’s risk-corridor program, but it’s looking less and less likely that the feds will ever pay up.
Sanford Health Plan, the insurance arm of Sioux Falls, S.D.-based Sanford Health, sued the federal government, demanding it pay nearly $9 million in overdue risk-corridor payments for 2014 and 2015. The CMS so far has paid Sanford Health Plan just 15.1% of the amount it owes, according to the complaint filed last week in the U.S. Court of Federal Claims.
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Given by a drop-off in enrollment after President Trump took office, total sign-ups for Obamacare health plans fell this year for the first time, a new report released by the Trump administration Wednesday indicates.
A total of 12.2 million Americans enrolled in a plan through one of the healthcare law’s marketplaces during the 2017 open enrollment period, according to the report, which provides a final tally of this year’s signups.
The 2017 final figure, which updates a preliminary report released last month, was down from 12.7 million in 2016.
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Spending on prescription drugs for health plans created under the Affordable Care Act increased last year at a rate more than three times that of other commercial plans and most government-run plans managed by Express Scripts Holding Co.
Express Scripts, the largest manager of prescription drug plans for U.S. employers, on Tuesday said year-over-year spending per person for individual insurance plans sold on the Obamacare exchanges where it manages the pharmacy benefit rose 14% in 2016, driven by higher drug prices and utilization.
Express Scripts said per-capita spending for other commercial plans it manages, mostly for employers, rose just 3.8% last year, despite an 11% increase in list prices for brand-name drugs.
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Anthem Inc. and other U.S. health insurers complained to the White House for more than a year that they were losing money on people who waited to sign up for Obamacare coverage until they were sick.
They pleaded with the Obama administration to stem their losses by tightening up on the enrollment rules. When their pleas went unmet, UnitedHealth Group Inc, Humana Inc, and Aetna Inc pulled out of most of the government subsidized health insurance market.
But now that the new Trump administration and Republican lawmakers control the future of healthcare, the industry is getting a new hearing.
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The United States Court of Federal Claims just ruled that the federal government failed explicitly to appropriate money for an ACA program known as “Risk Corridors” to stabilize the ACA exchanges, and therefore sent the United States an $8 billion bill to make these payments to insurers. It is unlikely that this decision will result in much money actually being sent to insurers or in many insurers returning to the ACA markets. Many of the insurers owed money have already gone out of business. Others have, quite literally, written off any chance of recovering any of this money. Insurers are instead likely to see the money as a bit of a windfall that will not affect business decisions one way or the other as to whether and how to remain in the ACA marketplace.
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The Trump administration proposed new rules on Wednesday to stabilize health insurance markets roiled by efforts to repeal the ACA, by big increases in premiums and by the exodus of major insurers. The move came a day after Humana announced that, starting next year, it would completely withdraw from the public marketplaces created under the ACA. The proposed rules, backed by insurance companies, would tighten certain enrollment procedures and cut the health law’s open enrollment period in half, in hopes that a smaller but healthier consumer base will put the marketplaces on sounder financial footing and attract more insurance companies in states with limited choices.
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Molina Healthcare’s stock tumbled after hours Wednesday after the health insurer posted a fourth-quarter loss that was attributed to parts of Obamacare — a big problem for one of the health insurers that has had success in the program.
However, the company didn’t lose money because it had sicker-than-expected enrollees. In fact, medical costs for its Obamacare enrollees were $120 million lower than Molina thought. Instead, Molina got slammed because it had healthier members and had to pay $325 million into an Obamacare program called risk adjustment, which pools money from insurers in a given state and redistributes it to those who had higher-cost enrollees.
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The new administration should issue two new rules for the 2018 enrollment season:
- It should let online brokers complete enrollments for people who qualify for subsidies. No need to redirect these applicants to HealthCare.gov.
- It should stop imposing user fees to prop up its unnecessary website and finance ad campaigns.
These two changes would set loose an army of insurance carriers, traditional brokers and private online exchanges, all competing to enroll people in subsidized coverage.
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