aside Courts May Come To The Rescue To Save Obamacare One More Time

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Sen. McConnell

The courts may be coming to the rescue of Obamacare again. The republican President Donald Trump has stated that he would like to just allow Obamacare/ Affordable Care Act/ ACA to implode. And the US Congress appears to be following the president’s lead even though, there is a bipartisan group of about 43 US Congressional representatives as well as several state governors who want to take action to stabilize the insurance markets to save Obamacare.

While all sensible peoples agree that Obamacare requires fixing, many of the current problems have been as a result of republicans deliberately not honoring commitments required by the 2010 Affordable Care Act. The president has been thinking out-loud about continuing  with these tactics. But the courts may be in a position to block the president from moving in this counter productive way.

If Obamacare implodes because the president and republican lawmakers refused to act, then they will own all the negative consequences.

Image result for photos of the senate working on skinny obamacareHere’s the rest of the story…

On July 30, 2017, Paul Demko of Politico penned the following report, “Lawsuits could force feds to pay Obamacare insurers.”

“A pending court decision could force the Trump administration to pump billions of dollars into Obamacare insurers, even as the president threatens to let the health care law “implode.”

“Health insurers have filed nearly two dozen lawsuits claiming the government owes them payments from a program meant to blunt their losses in the Obamacare marketplaces. That raises the prospect that the Trump administration will have to bankroll a program the GOP has pilloried as an insurer bailout.”

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MCCAIN

“Insurers are owed more than $8 billion in payments, and the tab is likely to grow. Insurers say spending restrictions Republicans forced on the “risk corridors” program during the Obama administration, aside from being illegal, are partly to blame for severe turbulence in some Obamacare marketplaces.”

“(The Obama administration) repeatedly assured us it was there and it would be a clear obligation of the government,” said Tom Policelli, CEO of Minuteman Health, which is among the insurers suing the government over the shortfall. “Even the federal government is subject to the rules.”

Image result for photos of the senate working on skinny obamacare“The fiscal hit to the feds could be huge if the insurers win. And it would be one more embarrassing setback for Republicans, who likely saw their best shot at dismantling Obamacare slip away in the Senate’s failed repeal vote early Friday morning. President Donald Trump, meanwhile, has threatened to pull billions in funding from a separate Obamacare subsidy program he’s labeled a “bailout” for insurers.”

“The courts have so far split on whether the government must pay risk corridor funding since the first lawsuits were filed last year. In November, Land of Lincoln Health, a now-defunct nonprofit startup in Illinois, lost its case in the Court of Federal Claims seeking more than $70 million. But in April, Oregon-based Moda Health was awarded more than $200 million.”

Image result for photos of the senate working on skinny obamacare“Both cases have been appealed and will be considered together by the same three-judge panel in Washington. Legal briefs in the combined cases are expected to be finished in September, but it’s not clear when a decision will come.”

“The decision could set a precedent that other judges will rely on when deciding similar lawsuits still winding through the system.”

“The legal issue that all of them would be raising would be identical,” said Nicholas Bagley, a professor at the University of Michigan Law School who has written extensively about the lawsuits. “Has a promise been made, and has the federal government reneged on that promise?”

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“If insurers do prevail, more are expected to seek federal payments through the courts. They would likely file similar lawsuits or join a class action brought by Health Republic Insurance of Oregon, a now-shuttered nonprofit that said federal underpayments contributed to its collapse in 2015. The issue could ultimately wind up before the Supreme Court, which has already twice saved Obamacare from potentially fatal legal challenges.”

“The one thing I know you don’t do is leave money on the table,” Bagley said. “It’s a question of how.”

“The risk corridor program was one of three established by Obamacare to protect insurers entering the fledgling marketplaces under new rules requiring them to accept patients regardless of medical condition. Insurers making more money than expected in the markets were required to pay into the program, while those with big losses would receive payments.”

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“Many companies badly underestimated the cost of these new customers, who turned out to be sicker than expected. They racked up at least $10 billion in losses in the first two years, according to McKinsey. That meant far fewer insurers paid into the risk corridors program than qualified for payments. In 2014, the first year of the Obamacare marketplaces, insurers received just 12.9 percent of the nearly $3 billion they sought from the program.”

“The insurers say the federal government has an obligation to use taxpayer dollars to provide payments they’re owed. But Republican lawmakers, who contend such payments would amount to a bailout, have blocked the federal government from filling the shortfall.”

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“We’re going to follow the law, and the law says you’re not supposed to spend taxpayer money to bail out these companies,” Sen. Marco Rubio, who led GOP opposition to risk corridors funding, said during a Facebook Live event last month.”(Reinsurance/ risk corridors is commonly used by insurance industry and it is what keeps costs down for auto and home insurance policies. It is not a bailout.)

“The Obama administration fought the lawsuits but also discussed potential settlements with insurers, a prospect that made Republican lawmakers irate. Any talk of settlements ceased when Trump took office, meaning the courts will almost certainly settle the dispute.”

Image result for photos of the senate working on skinny obamacare“The program’s funding restraints forced many insurers to raise premiums higher than expected in the (2017) Obamacare marketplaces. The shortfall has been especially tough on small insurers and Obamacare co-ops, nonprofit health insurers seeded with federal loans to compete with legacy providers. Many were counting on the risk corridor funding and didn’t have the resources to absorb the financial blow when the money didn’t come through. About two-thirds of the 23 Obamacare co-ops have shut down.”

“The whole system was to attract insurers like my client, Land of Lincoln, to participate in the first place,” said Daniel Albers, an attorney representing the failed co-op. “The Republicans want to say it’s a bailout. It’s not a bailout.”

Image result for photos of the senate working on skinny obamacare“Legal experts who support Obamacare say the health care law doesn’t explicitly prevent the government from making payments to insurers. Instead, they say the statute only provides the formula for determining which insurers pay into the program and which ones get paid.”

“Nowhere does it say they have to balance out,” said Tim Jost, emeritus professor at the Washington and Lee University School of Law.”

“At least one observer is betting that insurers will ultimately receive risk corridor payments they’re owed. Juris Capital this month agreed to pay $10.5 million to the estate of HealthyCT, a defunct nonprofit insurer. In return, it will receive up to $31 million if HealthyCT wins its lawsuit.”

9 comments

  1. Dear Suzanne,

    I wonder when even they get weary of DDT. i suspect that this will come to a head after the US Congress members gets their tax reform/ tax cuts plan passed and signed by the president.

    Hugs, Gronda.

  2. DDT is trying to run the country like he ran his companies, but screwing over everyone. In the case of his companies, it was the contractors who were screwed out of money he owed them after they had completed their work. In the case of our country, he is screwing over insurance companies who already paid out claims and are now left holding the bag, or in come cases filing bankruptcy claims. And in the long run, it is We The People who are on the short end of the stick, for if he forces ACA to fail by refusing to uphold the obligations of the federal government, we will not have any health care. His approval rating this week is between 35% and 39%, depending on which poll you choose. I do not understand how it is not in the single digits.

    Hugs, my friend!

  3. Dear Jill,

    Let’s hope the courts can make the republicans do what is the right thing to do. Letting Obamacare should not be allowed to implode and hopefully they will not get away with continuing to sabotage Obamacare.

    The president is a horrible example to follow and that is what republican lawmakers are doing.

    Hugs, Gronda

  4. Gronda, you have been relentless on raising the issue that Republican Senators have gone out if their way to stiff the insurance companies. These are legal commitments and both Marco Rubio and Donald Trump are dead wrong to call them bailouts. In so doing, they are screwing Americans to win a political point.

    It should be noted it is not uncommon for the Trump to renege on a deal as this is s modus operandi got his business practices. It was so bad, one contractor said “word on the street is get your money upfront,” when dealing with a Trump business. That is a direct quote. Keith

  5. Dear Keith,

    I can only pray that the courts teach the president and the republican lawmakers, a lesson.The contractual obligation to the insurers needs to be honored as their executives acted on the legislators commitments by joining the Obamacare marketplace. And some would not have if they knew that they would have to go to court to fight for what they were promised.

    Hugs, Gronda

  6. Single Payer. The ONLY logical option. The main reasons the Republicans who represent either an antisocial McCarthyist syndrome or are heavily subsidized by the 1%,Big Pharma and Insurance lobbyists, ( which the same goes for the corporate Dems afraid to piss off their similar donors, and they make a lot of mouth movements about how it would be too expensive, that waits would be terrible, or that we would have no choice in doctors are lying. There are a lot of variables at play, many of which would be negotiating drug prices, making college education/medical school more affordable, lifting the cap on medical school attendants, and making certain more doctors were not choosing specialty medicine instead of D.O, General Practice,Pediatrics,Gerontology, and Integrative Practitioners, by ensuring they would not be unable to live with their school debts while starting out on lower salaries, and also making it more enticing and affordable for some of the needed specialities like Research medicine, Environmental Medicine, Neuropsychiatry, and many more Immunologists-
    Who truly cover a LOT of the increasing American Maladies. We need to get regular working and middle class people fretting about their healthcare costs to understand the mechanics and benefits of single payer-
    People of all political leanings (especially middle aged men who often resist going in for checkups, for a number of reasons, then waiting until they are well passed high risk and showing advanced illness- which is then costly and often having poor prognosis. In addition to this, people who have diagnosed conditions, who half way manage conditions because they fear maintenance costs with ongoing visits and tests to monitor, and again,they go in when its extra expensive or too late-
    And this is often the mentality of people with workplace provided insurance- or even low cost subsidized care.. they dont want to use the care for cost, because they feel fine in the beginning, or because they have fear of what might be found- but well care, prevention and education would save us all millions- for each prehypertension case caught and reversed, for each diabetes risk mitigated, and for obesity and behavioral management that would prevent all the disease that goes with them, single payer for all with strong preventive care would help a lot of Americans financially and physically.
    Goodbye Private Insurance, Goodbye million dollar big Pharma CEO salary… 💖

  7. Dear MedusaBotanica,

    WELCOME!

    If the US Congress were to consider Medicare for all, it would be a win for every party involved in healthcare delivery. In Florida the insurance companies are still involved in the administration of Medicare. More peoples would have access to affordable higher quality health insurance. This would reduce the costs to businesses which would amount to a cut to companies’ expenditures. Then if Medicare administrators were granted the power to negotiate on drug costs with big pharma, then even more savings could be possible.

    Republicans could possibly even garner enough savings for their planned dream tax cut bill..

    But this would be too sensible.

    Thanks for stopping by and Hugs, Gronda

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