Trump administration slashes more ObamaCare funds

Navigators say some of the work they do, like with Medicaid, isn't counted by the government.

The Centers for Medicare & Medicaid Services announced over the weekend that it was freezing billions of dollars in so-called risk adjustment payments for plans under the Affordable Care Act, also known as Obamacare, because of a court decision earlier this year that deemed the formula for determining these payments unlawful. No longer were insurers allowed to deny coverage or charge higher premiums for patients who suffered from costly preexisting conditions. It discourages companies from trying to save money by cherry-picking the healthiest people and kicking others to the curb. That's why Obamacare included several provisions to help insurers cover the costs of the sickest patients - among them, the risk adjustment program. About $10.4 billion was slated to be transferred a year ago. On Saturday the administration announced it was suspending a risk adjustment program. "It is not the bailiwick of community organizations" that are expressly forbidden under the navigator program's rules to recommend any particular health plans. It's the only remaining risk mitigation program in Obamacare.

For the past five years, when insurance has been available through ACA marketplaces for people who do not have access to affordable health benefits through a job, federal health officials have started every spring working with navigator groups on plans for the coming enrollment season. The CMS has appealed the decision, particularly because a MA court upheld such payments. Some companies that had expected hundreds of millions of dollars in risk-adjustment payments fear the funds may fall through, while others that had expected to owe hundreds of millions wonder if they may be off the hook. The mandate was created to stabilize the health insurance market by encouraging younger and healthier Americans to sign up for insurance, and the repeal could consequently have the opposite effect.

The agency believes that the majority of individuals that need an ACA-compliant health plan have the basic knowledge to purchase plans through the exchanges, based on ACA navigator utilization during 2018's open enrollment period. The administration is also pushing to broaden the definition of short-term insurance, which is also exempted from the ACA's rules.

"So much uncertainty put in the market at this point of time is very unnerving", said Ritu Agarwal, senior associate dean of research at the University of Maryland Robert H. Smith School of Business, who follows the health care system.

But combined with other recent actions by the Trump administration, the decision sets a negative tone, Hoagland said.

The president last fall also issued an executive order to try to make it easier for individuals and small businesses to buy health plans that cost less than ACA coverage because they cover fewer medical services and bypass the law's rules meant to protect people from old insurance practices in which companies had charged higher prices to women, older people, and those with preexisting medical conditions. The nonprofit insurer sued the government in 2016 claiming the risk adjustment program unfairly penalized smaller insurers.

Obamacare surges on, with the public continuing to approve of it and health insurers coming back to the markets after sitting previous year out.