Despite Congress’ efforts to use riders to neutralize a provision of the Affordable Care Act (ACA or Act), the Federal government (Government) owes certain insurers $12 billion. On April 27, 2020, the Supreme Court of the United States (SCOTUS) ruled 8-1 that congressional riders added to appropriations bills that funded the Centers for Medicare & Medicaid Services (CMS) in 2014, 2015, and 2016 did not, in fact, override the Government’s payment obligations pursuant to the ACA’s “Risk Corridors” provision at Section 1342 of the Act (Section 1342).
The Risk Corridors program provided a formula to determine whether health plans participating in the ACA’s healthcare exchanges incurred gains or losses at the end of each of the first three years of Obamacare. Section 1342 states that profitable plans “shall pay” a sum to the Secretary of the Department of Health and Human Services (Secretary), while the Secretary “shall pay” a sum to eligible unprofitable plans. Continue Reading