This week, as part of the reconciliation bill, Congress may vote on bailing out health-insurance companies losing money from their participation in the Affordable Care Act exchanges. With an $18 trillion national debt, Congress should stand firm and say no to the bailouts.
Insurance companies were relying on payments from the federal government to constrain their losses as part of a device known as “risk corridors.” Risk corridors allow the government to bear a portion of the costs if they become too high. Section 1342 of the Affordable Care Act states that the secretary of HHS can reimburse insurance companies if the costs of covering sick people exceed the premiums received. However, the act did not provide an appropriation for these funds. In order for risk-corridor funds to be distributed, Congress has to appropriate them.