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This site is dedicated to the Honorable people, those who did not cross the picket lines at Northwest Airlines, commonly referred to as SCABair. Now that Delta and NWA are one carrier, Delta now picks up the moniker of SCABair, because they employ the same SCABS that NWA did.
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What a mess...
Obama administration may use obscure fund to pay billions to ACA insurers
By Amy Goldstein
The Obama administration is maneuvering to pay health insurers billions
of dollars the government owes under the Affordable Care Act, through a
move that could circumvent Congress and help shore up the president’s
signature legislative achievement before he leaves office.
Justice Department officials have privately told several health plans suing over the unpaid money that they are eager to negotiate a broad settlement, which could end up offering payments to about 175 health plans selling coverage on ACA marketplaces, according to insurance executives and lawyers familiar with the talks.
The payments most likely would draw from an obscure Treasury Department fund intended to cover federal legal claims, the executives and lawyers said. This approach would get around a recent congressional ban on the use of Health and Human Services money to pay the insurers.
The start of negotiations came amid an exodus of health plans from the insurance exchanges that are at the heart of the law. More than 10 million Americans have gained coverage through the marketplaces since they opened in 2014.
But many insurers are losing money on their new customers, who tend to be relatively sick and expensive to treat. As a result, some smaller plans have been driven out of business and a few major ones are defecting from exchanges for the coming year.
The administration’s efforts reflect the partisan thorns that still surround the sprawling law a half-dozen years after its passage. The payouts that officials want to salvage were part of an ACA strategy to help the marketplaces flourish early on. But Republican opponents in Congress branded them an insurance industry “bailout” and restricted the use of HHS funds.
A settlement probably would rely on Treasury’s Judgment Fund, a 1950s creation that is allowed as much money as it needs to satisfy valid claims against the government. The fund’s website shows that it has been used for a few hundred claims against HHS in the past decade. Taken together, they amounted to about $18 million — a fraction of what the insurers are owed.
In the administration’s waning months, officials are continuing their upbeat portrayal of all aspects of the law. Behind the scenes, they think that making these payments to insurers — $2.5 billion for 2014 and an as-yet-undisclosed sum for 2015 — is crucial to the exchanges’ well-being.
“It’s a legacy item for the White House,” said Dan Mendelson, president of the health consulting firm Avalere and an adviser on the payout effort. “It’s more than just a lawsuit. It’s really about the future . . . and stability of these markets.”
GOP lawmakers are already beginning to cry foul. “It’s an end run on the clear . . . intent of Congress,” said Rep. H. Morgan Griffith (Va.).
The money in question involves one of three strategies to help coax insurers into the marketplaces by promising to cushion them from unexpectedly high expenses for their new customers. This particular strategy, known as “risk corridors,” was for the marketplaces’ first three years, when it was unclear how many people would sign up and how much medical care they would use. Read the rest of the article here
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