Fresh problems for “Obamacare”: The largest health insurer in Texas wants to raise its rates on individual policies by an average of nearly 60 percent, a new sign that President Barack Obama’s overhaul hasn’t solved the problem of price spikes.
Texas isn’t alone. Citing financial losses under the health care law, many insurers around the country are requesting bigger premium increases for 2017. That’s to account for lower-than-hoped enrollment, sicker-than-expected customers and problems with the government’s financial backstop for insurance markets.
The national picture will take weeks to fill in. With data available for about half the states, premium increases appear to be sharper, but there are also huge differences between states and among insurers. Health insurance is priced locally.
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Yesterday, the New York Times detailed the highly irregular manner preceding the administration’s decision to make the CSR payments once Congress refused to grant the White House’s request for an appropriation. Despite strong disagreements over the legality of these payments among IRS employees, top political appointees with the administration, including then-Attorney General Eric Holder and Treasury Secretary Jack Lew, signed off.
At a congressional deposition, David Fisher, an IRS financial risk officer at the time, testified that the process behind the authorization of the CSR payments was unusual. Moreover, he testified that the “cost-sharing reduction payments are not linked to the Internal Revenue Code, as far as I could tell, directly anywhere. There is no linkage to the permanent appropriation, nor is there any link to any other appropriation that was indicating what account these funds should be paid from.”
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The not-for-profit insurers that are planned to form the backbone of the Obamacare exchanges, including the Blues health plans, reported yesterday that they lost a lot of money in the first quarter of 2016. It was the same day that United Healthcare announced that it was pulling out entirely from the California exchanges–a state that many Obamacare acolytes held up as a model for the law’s successful execution.
In statutory filings that they posted this month, the not-for-profit health plans showed an average negative net margin of -2.5% during the first quarter of 2016. AIS Health Plan Week revealed the data on 41 not-for-profit plans. Credit Suisse reported on those results in a report issued yesterday. The total net losses among the 41 health plans approached a whopping $1.5 billion for the quarter.
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House Republicans say that the Obama administration is ignoring subpoenas for documents related to ObamaCare spending they call illegal.
“Your refusal to provide the requested documents and information raises serious concerns about the Department’s willingness to be accountable for the lawful execution of laws passed by Congress,” Upton and Brady write to HHS Secretary Sylvia Mathews Burwell.
A federal district judge ruled this month, in a lawsuit brought by House Republicans, that the Obama administration lacks the authority to pay cost-sharing subsidies to health insurers if Congress has not appropriated the funds. Some civil servants in the administration may agree.
The House Ways and Means Committee released a deposition Tuesday of David Fisher, former chief risk officer for the Internal Revenue Service. In it, Mr. Fisher recounts a series of events in late 2013 and early 2014 regarding the source and legality of Obamacare cost-sharing subsidies to insurers.
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The American people have become familiar with ObamaCare’s failings: higher premiums, fewer choices and a more powerful federal health bureaucracy. Yet another important piece of health-care legislation, signed into law last year, has gone almost unnoticed.
The Medicare Access and CHIP Reauthorization Act, known simply as Macra, was enacted to replace the outdated and dysfunctional system for paying doctors under Medicare. The old system, based on the universally despised sustainable-growth rate formula, perennially threatened to impose unsustainable cuts in physicians’ fees.
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UnitedHealth Group Inc. is leaving California’s insurance exchange at the end of this year, state officials confirmed Tuesday.
The nation’s largest health insurer announced in April it was dropping out of all but a handful of 34 health insurance marketplaces it participated in. But the company had not discussed its plans in California.
UnitedHealth’s pullout also affects individual policies sold outside the Covered California exchange, which will remain in effect until the end of December.
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Two recently filed lawsuits illustrate continuing difficulties the administration faces in implementing the Affordable Care Act, particularly under the constraints imposed upon it recently by Congress. Specifically, the suits illustrate the legal difficulties for the administration created by Congress’ limiting of “risk corridor” payments—made to insurers with high claims costs—to amounts contributed to the risk corridor program by insurers with low costs. Last year, CMS announced that it would have only $362 million in contributions to pay out $2.87 billion in requested payments, and so would only pay out 12.6 cents on the dollar for payment claims.
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